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Mr. Cash: I am intrigued by that answer. The fact that the court may, under clause 46(5), make
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the exercise of its power under subsection (3)—subject to such terms and conditions as it thinks fit—does not include the power to be able to impose what would effectively be the indemnity that is referred to in the arrangement that we are proposing, which is an entitlement to an indemnity for someone who suffers loss by reason of the exercise by the court of its powers under clause 46.
I am glad to say that another note is being passed to the Minister, and I hope that it comes to his rescue on this occasion. Where the court finds that it has to make an entry, it does not take that decision for a frivolous reason; it takes it because, having listened to the arguments, it has come to the conclusion that that is necessary. If that is necessary, and loss is incurred by someone under schedule 8(1), and if the power to impose conditions is not enough to provide an indemnity but the court thought that the matter was important enough to do that in any case, why should not the person be able to obtain the indemnity that he would, otherwise, have been able to get? That is illustrated by a glance at the other entitlement provisions, such as a mistake in the cautions register, a mistake whose correction would involve rectification of the register, and a mistake in an official search. My point is that there is a category within which clause 46 falls that is not dissimilar to those that are set out in the indemnity provisions relating to entitlement.
I am open to further persuasion, and I suspect that another note is making its way to the Minister that might help me to understand the matter better. However, I will not withdraw the amendment until the Minister has had a chance to read the note in front of him.
Mr. Wills: It will not take long to read.
I am advised, by people who are in a far better position than I am to know the facts of the matter, that the court will require an undertaking in damages from the applicant, and that, if there is a mistake, an indemnity is payable. I hope that the hon. Gentleman can add that to the reassurances that I have already given him, and that he will withdraw the amendment.
Mr. Cash: That just goes to prove the beauty of our democratic system. As a result of pursuing the matter a little further as we reach the dying moments of the Committee, the Minister has said something that provides me with enough reassurance to be able to withdraw the amendment, although I had told my troops—or, rather, troop—that we would press the matter to a Division. However, we might return to it on Report, because I shall seek further advice on the question. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 8 agreed to.
Schedule 9 agreed to.
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Schedule 10
Miscellaneous and general funds
3.15 pm
Mr. Cash: I beg to move amendment No. 75, in page 66, line 19, leave out paragraph 3.
This important provision relates to the manner in which rules will apply with regard to implied covenants. The amendment is probing. Why does the Minister consider the provision to be necessary? We suggest that it should be omitted, with a view to finding the reasons for its inclusion.
Mr. Wills: As always, I am delighted to respond to the hon. Gentleman's probing. Paragraph 3 of schedule 10 fulfils an important function in the conveyancing process. As the hon. Gentleman said, it relates to implied covenants. An obligation to deduce title to land in accordance with a contract of sale comes to an end on completion of the sale. The establishment that there has been a breach of implied covenants for title is the only way in which a transferee can attempt to remedy defects in title that emerge after completion.
Rule 77A(2) of the Land Registration Rules 1925 currently provides that a person will not be liable for a breach of most implied covenants in respect of matters set out on the register of title. I hope that the hon. Gentleman is paying attention to this important point.
Mr. Cash: He is paying great attention, and can hear with both ears.
Mr. Wills: I am anxious to reassure the hon. Gentleman about this important point and he will not be reassured if he is not fully engaged.
Mr. Cash: I was seeking advice from the Clerk with respect to the termination of our proceedings, which is coming. I listen with great and avid interest—as ever—to what the Minister is saying.
Mr. Wills: That was the only moment during our proceedings when I saw the hon. Gentleman's attention flag for even a second. I thought that I should bring him back to the task that faces us all.
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I mentioned the provision in the Land Registration Rules 1925. The Bill addresses that by inserting a new subsection into section 6 of the Law of Property (Miscellaneous Provision) Act 1994. That insertion does not exactly replicate existing law but the differences are not material. As a consequence, the law is made clearer, more coherent and more accessible. The rule-making powers in schedule 10 are fairly limited in scope but are, nonetheless, important. They are designed purely to ensure that everyone knows when implied covenants have been given in relation to a transaction and whether the statutory form of covenant has been modified in any way.
There is no intention—I suspect that the hon. Gentleman may fear that there is—to tinker with the precise wording of implied covenants that have been developed and refined over the centuries. I hope that that reassurance will enable the hon. Gentleman to withdraw the amendment.
Mr. Cash: Having heard the Minister's exposition from beginning to end, I am glad to assure him that I will withdraw the amendment. However, as we are reaching the end of our proceedings, I should tell the Minister that there are further points on which I may correspond with him or table further amendments on Report. However, subject to that, I am grateful to the Minister for his explanations, and I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 10 agreed to.
Schedules 11 to 13 agreed to.
Question proposed, That the Chairman do report the Bill, as amended, to the House.
Mr. Wills: It is my happy lot to say thank you, Mr. Illsley, for chairing the Committee. I wish to thank in particular my officials, as well as all other members of staff who have assisted during the Committee's proceedings.
Mr. Cash: I would like to thank the Minister and all other members of the Committee, as well as you, Mr. Illsley.
Mr. Sanders: May I echo the comments of the Minister and the hon. Member for Stone, and offer my thanks to all concerned with the Committee?
Question put and agreed to.
Bill, as amended, to be reported.
Committee rose at twenty-one minutes past Three o'clock.
The following Members attended the Committee:
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Illsley, Mr. Eric (Chairman)
Barnes, Mr.
Cash, Mr.
Clarke, Mr. Tony
Dobbin, Jim
Doughty, Sue
Garnier, Mr.
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Hoban, Mr.
Marsden, Mr. Gordon
Mole, Mr.
O'Brien, Mr. Stephen
Sanders, Mr.
Stringer, Mr.
Wills, Mr.
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