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The Earl of Caithness: I am grateful to the noble Baroness for taking away the point. There is potential for confusion and further litigation in due course. The noble Baroness said that my noble friend's amendment was a partial interpretation. I am sure that with the help of her officials the Minister can provide a full interpretation.

Baroness Buscombe: I thank the Minister for her response and also for the support of my noble friend the Earl of Caithness. I appreciate the Minister's reassurance that she will take away and consider the

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points that I have made. Further, I am grateful to the Minister's very helpful offer of more consultation between the stages of the Bill.

The point was raised at Second Reading by my noble friend Lord Kingsland and I repeat it now, not least because a number of extremely experienced and able members of the Chancery Bar have already questioned the meaning and definition of the term "physically present". If we are unable to clarify this term prior to the passing of the Bill we are in danger of seeing more litigation than is really necessary. That would be unfortunate. Therefore, I shall return to those who are supporting us. The Minister said that she will consult with others. Let us see if we can come up with some solution to the point. On that basis I have pleasure in begging leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 16 and 17 not moved.]

Schedule 1 agreed to.

Clause 13 [Appurtenant rights and charges]:

Viscount Bridgeman moved Amendment No. 18:

    Page 8, line 13, after second "estate" insert "or interest"

The noble Viscount said: In moving Amendment No. 18 I shall speak also to Amendment No. 19. These are technical amendments. The purpose of the clause is to facilitate the registration of the benefit of, among other matters, appurtenant easements. I refer noble Lords to Note 68 on page 473 of the report.

Section 1(1) of the Law of Property Act 1925 describes the fee simple and the lease as estates. Section 1(2) describes easements and so on as "interests" and as held "for an interest equivalent to" a fee simple or a lease. It is therefore not strictly correct to use the word "estate" to include easements and other matters within Sections 1(1) and (2) of the Law of Property Act 1925. For the avoidance of doubt, the appropriate course is to extend the provision to refer to registration of "interests" which are appurtenant to, or burdens on, a registered estate. I beg to move.

Baroness Scotland of Asthal: As the noble Viscount has said, Amendments Nos. 18 and 19 tabled by the noble Baroness both make amendments to Clause 13. As such, I shall take them together.

The clause relates to the scope of rules which may be made to ensure that a register contains information not only about the registered estate but also unregistered estates which subsist for its benefit.

The amendments have been tabled to ensure that the rules can provide that the register contains information not only about unregistered legal estates but also about unregistered legal interests. That is highly desirable in view of the underlying objective of the Bill to ensure that the register contains as much of the information about the property as possible.

I hope, however, that I can reassure the noble Viscount, Lord Bridgeman, that the clause as originally drafted achieves this aim. The definition of legal estate contained in Clause 129(1) of the Bill refers to the definition in the Law of Property Act 1925.

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Section 1(4) of that Act defines "legal estates" to be the estates, interests and charges which are authorised to subsist or to be conveyed or created at law.

I am pleased to say that the clause as drafted already ensures that the rules have their wider scope. Therefore, I invite the noble Viscount to withdraw the amendments.

Viscount Bridgeman: I am most grateful to the Minister for that guidance. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 19 not moved.]

Clause 13 agreed to.

Clause 14 agreed to.

5.15 p.m.

Clause 15 [Right to lodge]:

Baroness Buscombe moved Amendment No. 20:

    Page 8, line 32, leave out "Subject to subsection (3),"

The noble Baroness said: In moving Amendment No. 20, I shall speak also to Amendments Nos. 22 and 108. These amendments are designed to retain permanently the ability of the holder of a registrable interest to enter a caution against first registration. Paragraph 3.58 of the report justifies the removal of this possibility on the basis that such a caution should not be,

    "a substitute for first registration",

and registerable estates should be registered. However, the discussion at paragraphs 2.9 and 2.13 of the report accepts that compulsory registration is triggered by the making of a disposition. That is likely to continue to be the case because it is--as the report says--"not easy" to devise an alternative system.

Pending a further review of mechanisms for ensuring comprehensive registration, as recommended in paragraph 2.13 of the report, the right course is to allow an owner who has not made a disposition triggering registration to enter a caution, so that he is told of any application for registration made by anyone else and affecting his land. Forcing an owner to apply for voluntary registration in order to avoid the risk of trouble arising from a mistake by someone else is a "heavy-handed" and "disproportionate" measure, such as paragraph 2.11 of the report deprecates.

We have received very strong support for the amendment from the Charities' Property Association. It is deeply concerned to highlight the possible impact on endowed charities of the abolition of cautions against first registration. It states:

    "It is possible that the Law Commission will recommend compulsory registration of all land. Currently, there is only encouragement of voluntary registration of land which means that there will continue to be unregistered land for the foreseeable future".

However, for many endowed charities, such as members of the Charities' Property Association, this could have a negative impact, particularly because

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cautions against first registration are to be abolished. In effect, the Bill will not provide them with the same level of protection against squatters for their unregistered land in contrast to the extra protection for registered land being conferred by Part 9 of the Bill.

In some cases the land that endowed charities own is unregistered because it has been owned for hundreds of years and full legal documentation does not exist. It would therefore, we suggest, be extremely expensive and very complicated for endowed charities to register it.

Currently, endowed charities with unregistered land can register a caution against first registration, as can others, by lodging a plan with the Land Registry and a statutory declaration for a fee of £40. The cautioner would then be notified of any application by a third party--such as, for example, a squatter--to register the land. Clause 15 and Schedule 12 remove that right.

This is a very important and fundamental point with regard to the Bill. On that basis, I beg to move.

Lord Goodhart: I rise to support the noble Baroness because my name is attached to some of the amendments in the group. I originally was inclined to the view that the Law Commission proposals on this matter were correct. But, having read the letter from the Charities' Property Association, a copy of which I also received, I was very impressed by its argument. Therefore, I support retaining the right of a landowner to register a caution against first registration over his own land.

I shall not add to the noble Baroness's comments except to say that, as between Amendments Nos. 107 and 108, I prefer Amendment No. 108 because paragraph 16 of Schedule 12 will still be necessary even if the other provisions which Amendments Nos. 20, 22 and 108 seek to delete are removed.

Baroness Scotland of Asthal: Amendments Nos. 20, 21, 107 and 108 deal with the rights of an owner, or anyone else prescribed by rules, to lodge a caution against first registration. I hear what the noble Baroness, Lady Buscombe, says in relation to how that will impact, particularly on charities.

Amendment No. 20 tabled by the noble Baroness would remove the qualification of the right of a person to lodge a caution against first registration set out in subsection (3). I shall therefore consider at the same time Amendment No. 22, which would delete subsection (3). That qualification stops the owner of a freehold estate or a leasehold estate with a term of more than seven years from lodging a caution as a substitute for applying for registration itself.

One of the fundamental aims of the Bill is to extend registration as far and as soon as possible. One of the ways in which it does that is to clarify and extend the benefits which come from registration and to ensure the sharpest possible distinction between registered and unregistered land. Those benefits form a package, and the way for the owners of land to achieve them is to have their land registered. Registration, however,

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not only provides benefits to the individual owner but also provides collective benefits. For example, problems can and do arise with the boundaries between registered and unregistered land, and the proprietors of unregistered land who continue in that state can be creating difficulties for their neighbours. The opening of the information contained on the register has provided much valuable material to the general public.

The Bill therefore seeks to maximise the advantages to the owner of registration. The amendment would do something to reduce the effectiveness of those measures. It would, in effect, enable a measure which is needed to provide a necessary safeguard for the interests of third parties to be used, as a side wind, to avoid some of the need for registration. That is undesirable. The overall aim should be that the person with an unregistered legal estate which is registrable should register it rather than using other means to protect his or her interests.

I would seek to reassure the noble Baroness, Lady Buscombe, that the new prohibition will not apply immediately. Under the transitional arrangements in paragraph 13 of Schedule 12, the new provision will have effect two years after the rest of the clause is brought into force. That will give landowners time to arrange to register their estates in land in the relatively rare circumstances where they feel that protection by a caution against first registration is warranted.

I hear what the noble Baroness says about it not being fair to require registration, particularly in relation to charities. But requiring registration in order to get the benefits is not being heavy handed, given the considerable benefits that we genuinely believe will accrue to those who register their interests. All owners have the opportunity to benefit from this system, which will make the dealings in their property quicker, surer and cheaper. Registration is not expensive and cautions have been useable for this purpose only since 1998.

Although we understand the concern, we genuinely believe that the reality will not be either as onerous or as burdensome as many fear. For the reasons I have already given, cautions against first registration under Clause 15 must not be used as an alternative to substantive legislation. To allow otherwise would be fatally to compromise our ambition of a complete register. However, we do intend to modify the application of the new rules in the early days of the new system so as to allow landowners the chance to make a protective entry in relation to their own land. That concession in paragraph 14 will run for a period of two years. The amendment would remove it. Similar considerations apply in relation to the Crown to paragraph 15.

As to paragraph 16, nothing in the repeals made by the Bill affects the validity of any caution against dealings against first registration lodged under Section 53 of the Land Registration Act 1925 or any enactment replaced, directly or indirectly, by that Act. The paragraph ensures that cautions against first registration under the 1925 Act are treated in a similar

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manner to cautions under the Bill. We believe that they will assist the general move towards the desirable goal of total registration of title. We think that the first instinct of the noble Lord, Lord Goodhart, to be supportive of the Law Commissioners was the right one. We regret that he has been tempted away from our shores but we hope to entreat him back.

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