1. This case is an appeal against a decision of the Keeper in terms of Section 25 of the Land Registration (Scotland) Act 1979. The appellants had sought rectification of the Register under section 9 of the 1979 Act. Having been unsuccessful they appealed to the Tribunal. The case has been concluded in their favour, without the Tribunal being required to take a decision. This note deals with a motion for expenses by the appellants against the Keeper, failing whom, Mr Brydie, the interested party. Expenses are sought from 27 September 2012. This is intended to cover both the expense of the initial application for rectification to the Keeper and the subsequent appeal to the Tribunal. No motion for expenses is made on behalf of the Keeper. All parties made written submissions.
2. The case concerns a small strip of ground in Arncroach, Fife. The appellants applied for registration of title of this ground in their name in 2012. The Keeper proceeded to do so but excluded indemnity, and recorded the fact that there was competition with a prior title registered in name of the Interested Party in 2007. The interested party’s title had been registered following the granting of an a non domino disposition. The Keeper excluded indemnity for the interested party’s title, which we understand to be her standard practice in registering a non domino titles. The interested party intimated his interest in the land to the appellant’s solicitor by letter dated 27 September 2012. This appears to have followed upon a grant of planning permission over certain subjects belonging to the appellants and including the strip. Thereafter, the appellants sought rectification of the Register by the Keeper under section 9 of the 1979 Act, we think, in December 2012. The appellants sought to have the interested party’s title cancelled. The application for rectification was contested by the interested party. After some correspondence the Keeper indicated that she was unable to adjudicate on the matter and in March 2013 declined to rectify the Register.
3. The appellants appealed to the Tribunal on 12 December 2013. At this point they also expressly sought rectification of their own title so that it should not exclude indemnity or rank behind the interested party’s title. The appellants’ position was that they had a habile title, supported by prescriptive possession, which was to be preferred to the interested party’s title. The Keeper made certain explanatory averments in her answers but essentially adopted a neutral position. The interested party provided a detailed response and, amongst other things, contested the issue of possession. This was in the context of prescriptive possession as opposed to the concept of “proprietor in possession” in terms of Section 9(3) of the 1979 Act. The appellants and interested party lodged productions with their initial pleadings. Both these parties adjusted and lodged further productions with their adjustments. On 30th June a hearing was fixed for 14 and 15 October 2014. The Keeper, as is normal in such cases, indicated that she would not be represented at the hearing. Following certain correspondence the Tribunal’s clerk confirmed to parties on 9th September that it was not appropriate to have the case disposed of by means of written submissions. On 29th September there was a proposal from the interested party to end the dispute. There was detailed correspondence but the position which emerged by 3 October 2014 was that the interested party would concede rectification in favour of the appellants, leaving it to the Tribunal to determine expenses. There was further correspondence in order to agree and ensure a mechanism to rectify the Register, which included correspondence with the Tribunal’s clerk and the Keeper. This involved the Keeper’s office producing a clean title for the appellants with full indemnity, and closing the interested party’s title. The Keeper managed to produce, commendably quickly in our opinion, an appropriate land certificate for the appellants on 10 October 2014. The hearing was thereupon discharged.
4. We were not addressed upon whether we are able to award the expense of the section 9 application process before the Keeper. This consisted of the application and correspondence between the Keeper and the appellants, but we understood that the interested party had been asked to make comments upon the application, and had done so.
5. Looking at the matter without the benefit of argument, we are not satisfied that we have power to make such an award. The Lands Tribunal Act 1949, section 3 provides:
“(5) Subject to the following provisions of this section, the Lands Tribunal [for Scotland] may order that the costs of any proceedings before it (emphasis added) incurred by any party shall be paid by any other party and may tax or settle the amount of any costs to be paid under any such order or direct in what manner they are to be taxed.”
The Lands Tribunal Rules of 2003 apart from giving us a general discretion to deal with expenses do not add to the 1949 Act in the context of proceedings under the 1979 Act. We do not think the section 9 application process can be described as having been “before” us in the 1949 Act sense. It is an application to the Keeper. The subsequent section 25 appeal is a full merits or open appeal from anything done, or omitted to be done by the Keeper. Procedurally it is akin to a first instance proceeding. It is not a limited review of earlier proceedings in which a first instance process might more loosely be said to have been brought “before” an appellate body. Furthermore, had the Keeper made the rectification we are not aware of any mechanism by which the expenses of the successful party would have been routinely recoverable. The section 9 jurisdiction relates to rectification, not compensation dealt with elsewhere in the Act. The cost of the application is more akin to extra-judicial expenses than judicial expenses of the Tribunal proceedings. So we do not think we have jurisdiction to award the expenses of the section 9 application in a section 25 appeal.
6. The appellants submitted that the Keeper should bear their expenses on the basis that she was substantially responsible for the litigation. It was submitted that she had granted to the interested party a land certificate on the basis of a “highly suspect” a non domino disposition, and moreover had lost the majority of the records lying behind the granting of that certificate. Further, she had not rectified the Register in the light of detailed affidavits and supporting information which showed that the appellants had a good title and that the interested party did not.
7. The background correspondence in this case indicates that the interested party had obtained a substantial amount of title information at the time of the 2007 registration. Search reports were obtained. His solicitors sought to persuade the Keeper to accept an a non domino disposition on the basis that the strip had previously belonged to his family and had been erroneously conveyed and reconveyed. It was further stated that the current proprietor could not be traced. A formal application for first registration dated 5th April 2007 was submitted. Amongst other things this stated, under certification, that there was no party in possession or occupation of any part of the subjects adversely to the interested party’s interests. This was a position which we infer would have been contentious if it had been known to the appellants at the time. The Keeper was persuaded to register the title, albeit without indemnity. This process was undoubtedly prejudicial to the appellants. But in our view without the wisdom of hindsight the process was unremarkable from the perspective of the Keeper.
8. It is unfortunate that some of the documents relating to this first registration have been lost – apparently only 13 out of 36 sheets had been archived - as the Keeper accepts. However we are unable to conclude that this has had a material bearing upon the proceedings. We were not given much idea of what items of importance might have been lost. For example, the Form 1 “Application for First Registration” which contains the representations made on behalf of the interested party was available and was produced shortly before the hearing was due to take place. We thus infer the more important documents had not been lost. So we do not think the appellants’ criticisms of the Keeper regarding the 2007 registration have weight in the present context.
9. We note that the appellants make no criticism of the Keeper regarding the conduct of the litigation before the Tribunal. As we have indicated, the Keeper adopted a neutral position and made various explanatory averments. This is normal practice and is helpful. It was helpful in the present case.
10. The real complaint relates to the fact that the Keeper did not rectify in favour of the appellants in the section 9 application. We do not think it has been argued, let alone decided, that the Keeper has, as it were, a duty in expenses to “get it right” in a rectification application. That would seem to be a bold proposition. The question is perhaps more whether the Keeper has a duty to take an obvious and clear cut decision so as to avoid the necessity of the section 25 appeal. This is potentially a point of some importance, and we were not addressed with argument on the matter. As it is, it is unnecessary for us to decide it as we do not think there are grounds upon which to criticise the Keeper’s actions at the section 9 stage. The appellants’ argument implies that the Keeper was, in effect, bound to rectify the Register because of what may have appeared a strong case in terms of the numerous affidavits and other documents produced for the appellants. But as appears from a letter from the Keeper to the appellant’s’ solicitor of 18th March 2013, the interested party had responded and contested the issue of possession. There was accordingly an issue of fact between the parties. To resolve it would have meant taking a view on credibility and reliability of factual evidence for one or other of the parties. The Keeper’s office is not geared up to determine disputes such as the factual dispute which had emerged. It follows there is no question of abrogation of responsibility. Accordingly we refuse the appellants’ motion for expenses against the Keeper.
11. The appellants sought expenses against the interested party. On the face of it, expenses should follow success and the appellants were successful in their appeal. We were referred to familiar authority to the effect that expenses should fall upon the party which has caused the litigation.
12. The interested party made a detailed written submission. In summary, he maintained that the appellants did not include him in detailed correspondence with the Keeper; the appellants had proceeded to the Tribunal without seeking a resolution of the issue by negotiation; and there was no substantive response to various suggestions he had made to resolve the situation in his letter of 27 September 2012. Various inaccuracies were pointed out in the appellants’ submission for expenses; he had not delayed until 2 days before the hearing in seeking a resolution as was being suggested; it was also maintained that the appellants did not follow correct procedures in that they did not forward productions to him prior to the hearing.
13. We are satisfied that this is not a case where circumstances are such as to depart from the normal rule that expenses follow success. Extra-judicial settlements are, of course, to be encouraged, particularly at an early stage. A successful party may be refused expenses where an action is unjustifiably raised without prior warning, giving an opponent no time to consider his position. These are usually cases where some aspect of the conduct of the successful party has been found wanting and has had some impact upon matters. However this is not such a case.
14. The interested party’s letter of 27 September 2012 was sent prior to the application for rectification. It suggested several methods of resolving the title situation, albeit without making a specific proposal. The inference was that both sides would have to compromise since the interested party indicated that he was confident of his position and was happy to defend it. There was a brief reply to the letter, but no discussion of a compromise. The fact the appellants did not want a compromise would have been self-evident from their subsequent prosecution of the section 9 application. That was, as it were, their substantive reply to the letter. The interested party proceeded to contest the rectification before the Keeper, and we infer his representations did influence the Keeper’s position. It must have been apparent to him that if the Keeper refused to rectify, as indeed she did, the appellants would require to take proceedings to the Tribunal if they wanted to vindicate their position. The interested party then chose to defend those proceedings until shortly prior to the hearing. The only inference therefore is that the litigation was rendered necessary by the interested party’s continued defence. The appellants no doubt adopted a robust approach, but there was no reason for them to discuss a compromise where this would have fallen short of their full remedy as the outcome of the case demonstrates. While a letter or email from the appellants’ solicitor to the interested party stating that they were proceeding to seek rectification might have been a professional courtesy in the light of the 27 September 2012 letter, if one was not sent, its absence does not seem likely to have affected matters.
15. There was a short period between the overtures, resolution and discharge of the hearing as narrated in paragraph 3 above. As experienced litigators are no doubt well aware, the expenses meter continues to run during this period. In the context of discussions involving not only the main parties, but also the Keeper and Tribunal’s clerk with the object of redrawing two sets of titles, we do not have any adverse comment upon the length of the period. As we have indicated, the Keeper produced a fresh land certificate expeditiously.
16. It does appear that the appellants did not forward their proof productions to the interested party, as had been requested by the standard letter from the Tribunal. However the appropriate number of copies was given to the Tribunal directly and timeously. The Tribunal’s clerk informed the Interested Party on 29th September 2014 that they had been received, but proposed not forwarding them on account of the present situation; i.e. on account of the proposed resolution. The interested party could have sought them had he wished. As it happened, the bundles included amongst other things existing productions being re-lodged in proof format. We do not think this matter is material to the issue.
17. We therefore allow the appellants their expenses from the interested party in respect of the Tribunal proceedings. We do not award expenses prior to that.