Schedule 5: Land Registry Network
Access to network
237.Paragraph 1 Amendment of entries in the register simultaneously with the execution of conveyancing documents is likely to be a feature of electronic conveyancing. Electronic conveyancers will therefore need to be given appropriately regulated access to the land registry network. Paragraph 1 therefore provides for a person who is not a member of the land registry to have access to the land registry network but only by means of a network access agreement made with the registrar. If, however, an applicant meets the criteria laid down in rules, the registrar must enter into an agreement with him (and paragraph 4 provides for appeals against refusal of access). That agreement may allow him to communicate with other users of the network and with the registrar; and post and retrieve information. It may allow him to input information into the system to make changes to the register or cautions register, and to issue official copy documents and search results. The network may also be used for such other purposes as the registrar sees fit. Rules may regulate how the network access agreements are used to confer authority to carry out the functions of the registrar. It is envisaged that different levels of access could be given to different categories of users depending on the role they play in the conveyancing process, e.g. different levels of access for estate agents, mortgage lenders or conveyancers. Rules made under this paragraph are subject to greater Parliamentary scrutiny than land registration rules are generally (see section 128) and the Lord Chancellor must also consult before making the rules. Under paragraph 11, the Lord Chancellor must have specific regard to confidentiality of information held on the network, competence of the users and the adequacy of insurance arrangements for potential liabilities.
Terms of access
238.Paragraph 2 The network access agreement referred to in paragraph 1 will define the nature of the transactions that a particular user may undertake through the network and such other terms as the registrar sees fit, including charging for access. Rules may regulate the terms on which access is authorised under paragraph 2. These rules are subject to greater Parliamentary scrutiny than land registration rules generally and the Lord Chancellor must also consult before making the rules. Rules may require that a user use the system for the transactions for which he is authorised to use it. The rules may also enable network transactions to be monitored (e.g. for chain management) or for such other purpose as has been specified in rules. The rules may specify terms for the regulation of the use of the network.
Termination of access
239.Paragraph 3 deals with two situations, the termination of the network access agreement by the user and the termination by the registrar. The user can terminate the agreement at any time by notice. Rules may make provision about the termination of the agreement by the registrar covering the grounds of termination, the procedure to be adopted when termination occurs and a system of suspension of termination pending an appeal (the right of appeal is dealt with in paragraph 4). The paragraph indicates that the basis for termination might include failure to comply with the terms of the agreement, failure to meet conditions laid down in rules made under this paragraph or ceasing to meet the qualifying criteria specified in rules made under paragraph 1. The registrar may have contractual remedies against a party to a network access agreement which he can pursue without terminating the agreement itself. He will be also able to provide education and training in the use of the network, to assist in developing standards. Rules made under paragraph 3 are subject to greater Parliamentary scrutiny than land registration rules generally and the Lord Chancellor must also consult before making the rules. In making rules about the termination of network access agreements, the Lord Chancellor must have specific regard to confidentiality of information held on the network, the competence of the users and the adequacy of insurance arrangements for potential liabilities.
Appeals
240.Paragraph 4 A person who is aggrieved by the registrar’s decision in respect of an application for a network access agreement or its termination may appeal to the adjudicator (for the role of the adjudicator see Part 11 and Schedule 9). This would be expected to involve handling disputes as to whether the registrar acted properly when deciding that an applicant did not meet the criteria for the level of access sought or in relation to the termination of an agreement. The adjudicator may substitute his own decision for that of the registrar and give directions to give effect to his determination. There is a further right of appeal on a point of law from the adjudicator’s decision (see section 111). Rules will govern how the appeals procedure works.
Network transaction rules
241.Paragraph 5 The Lord Chancellor may make rules covering the procedure to be followed throughout a transaction being undertaken through the network, including provisions about the supply of information to the registrar relating to unregistered interests, including overriding interests (compare section 71 and see paragraph 6 below). These network transaction rules will be of great practical importance as they will specify how electronic conveyancing is to be conducted.
Overriding nature of network access obligations
242.Paragraph 6 The network transaction rules made under paragraph 5 are likely to require an authorised conveyancer to provide specified information about a dealing, and, in particular, information about interests whose priority is protected without the need for registration. The rules are likely to require the disclosure of other information that a registered proprietor might not wish to have disclosed, such as the fact that a right to determine a registered estate in land has become exercisable. In addition, where the transaction is part of a chain, the conveyancer might have to disclose information about the transaction itself that the client regards as confidential. In these circumstances, the situation may arise where a conveyancer could be required to act contrary to the client’s wishes. Where conflicting obligations do arise, paragraph 6 provides that the obligation under the network access agreement prevails and discharges the other obligation to the extent that they conflict.
Do-it-yourself conveyancing
243.Paragraph 7 puts the registrar under a duty to provide assistance to enable do-it-yourself conveyancers to conduct their own conveyancing notwithstanding the introduction of a land registry network. That duty will only relate to the procedural and practical aspects of the conveyancing transaction. As now, the registrar will not provide legal advice. It is envisaged that the registrar will carry out the electronic transactions on their directions, and that this service will be available from district registries.
Presumption of authority
244.Paragraph 8 Under the present law, a conveyancer does not have implied authority to sign a contract for the sale or purchase of an interest in land on behalf of his or her client. This means that currently a conveyancer acting for one party to a conveyancing transaction would be entitled to see the written authority from the other party to his conveyancer to sign on his or her behalf. Paragraph 8 has been included to avoid the need for the exchange of paper-based authorities before contracts can be concluded electronically. Where an authorised network user purports to make a disposition or contract on behalf of a client which has been authenticated by the user as agent and contains a statement that the user is acting with the client’s authority, this will be deemed to be the case so far as any other party to the document is concerned. It is likely to be a requirement of rules under paragraph 5 that conveyancers should get authority in the appropriate way. The sanction for failure to do so would be the possibility of the network access agreement being terminated for failure to comply with its terms (it being a condition of such an agreement that those who are granted access comply with the rules for the time being in force under paragraph 5).
Management of network transactions
245.Paragraph 9 The terms of a network access agreement may, as envisaged by paragraph 2, require the network user to provide monitoring information. In relation to a transaction which is part of a chain, this would probably require the user to provide the registrar with details as soon as they were available of the fact that the transaction that the client was intending to enter into was part of a chain. Thereafter, he or she would need to disclose that a particular conveyancing step had occurred, for example that local searches had been completed or a mortgage offer received. Paragraph 9 enables the registrar, or the person to whom he had delegated “chain management” responsibilities, to use the monitoring information to manage network transactions. In particular, he may disclose such information to persons authorised to use the network, for example other conveyancers involved in the chain, and authorise further disclosure if he considers it necessary or desirable to do so. The “chain manager” will not have any direct coercive powers but will be able to identify the link in the chain that is causing delay and will then be able to encourage that party to proceed with due despatch.
Supplementary
246.Paragraph 10 provides that the registrar may provide, or arrange the provision of, education and training in relation to the use of a land registry network.
