1PB48636 (c ) THU.09.MAY.2013 @ 1423a @ at BLACKPOOL County Court HHJ BUTLER Judgment PDF @ TUE.15.JAN.2013 @ TMB & LAMB @ [Void Mortgage & Orders] @ Page1to40

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IN THE BLACKPOOL COUNTY COURT Claim No. 1PB48636

The Law Courts

Chapel Street

Blackpool

FY1 5RJ

Tuesday, 15th

January 2013

Before:

HIS HONOUR JUDGE BUTLER

Between:

THE MORTGAGE BUSINESS PLC

Claimant

-v-

MRS TILLY LAMB

Defendant

______________________

Counsel for the Claimant: MISS MAYOH

Lay Representative for the Defendant: MR FERGUS

______________________

JUDGMENT APPROVED BY THE COURT

Transcribed from the Official Tape Recording by

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Designated Civil Judge for LANCASHIRE His Honour Judge Philip BUTLER judgment & proceedings PAGE # 1 of 40

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JUDGMENT

1. THE JUDGE: In this case, the defendant Mrs Tilly Lamb seeks permission to appeal

against the decision of DJ McQueen given on 12th

July 2012, whereby he refused

permission. In effect, he refused permission to adduce and rely upon the defence, but

before doing that, he had refused an application to set aside a previous possession

order made by DJ Bury.

2. The case is complicated and I will have to just say a little about it in a moment, but in

simple terms, the respondent has applied for an adjournment of the permission

application after about an hour and a half of argument because only at that point was it

possible with the assistance of Mr Fergus, the defendant’s lay representative, after a

fair amount of debate, to appreciate - certainly I speak for myself - the very interesting

and intricate point that arises in this case. It is right to say that that point does not

seem to have been articulated fully or properly by the lay representative Mr Easeman

who appeared for Mrs Lamb before the district judge.

3. Faced with what to her was a case she had not been prepared to meet, Miss Mayoh,

counsel for the respondent, has applied for an adjournment. However, this is a matter

which has been running for some while and in relation to which there has been a

hearing before the district judge, there has been provision of a skeleton argument on

the respondent’s side and there has been some disclosure of internet material and

authorities on behalf of the claimant, which at the very least make clear that the

argument or objection was that the relevant mortgage or charge by way of legal

mortgage upon which the respondent relies in order to seek possession of the

defendant’s home was challenged in terms of its enforceability by reference to the

registration legislation. It seems to me that even if the precise point was not in issue,

the respondents were in a position to instruct their counsel and counsel is in a position

to be able to deal with the arguments that have been raised.

4. I bear in mind also that this is a matter where I have ordered that there be an oral

hearing of the application for permission to appeal. Albeit that my order on

30th

October said that the appeal itself would be heard thereafter subject to permission,

it has turned out that the estimate of the hearing was somewhat optimistic. I ordered it

be 2 hours 30 minutes, including 30 minutes’ judicial reading time. That is a two hour

hearing. In fact, unfortunately, today the hearing was delayed because of the appeal

this morning which went over. I did not have the opportunity for the full 30 minutes’

judicial pre-reading time, which no doubt will, I hope, explain why for the first 20

minutes or so I had some difficulty following the point that was being made but,

ultimately, we have got there. It is clear, therefore, that the 2 hour estimate was

inadequate and, indeed, as I speak, it is 4.35pm and all I have time for, having refused

the application to adjourn, is a decision on the permission application and, plainly, the

appeal itself, if I give permission, must then be heard at a later date. However, it is

clear in any event that 2 hours would not have been long enough for this matter and it

is going to be 2 hours by the time I finish speaking.

5. Let me as briefly as possible, because it may be that the parties will wish to obtain a

transcript for their own benefit, explain why, as I am, I am going to grant permission to

appeal to Mrs Lamb in this case. On 20th

July 2007, according to the evidence

submitted by the respondent, an offer was made of a mortgage to the appellant Mrs

Lamb and her former partner or husband, as I understand it sadly deceased. That offer



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was in a sum approaching a quarter of a million pounds to be secured against 14

Westminster Close, Simonstone in Lancashire and, on the respondent’s case - the

lender’s case - the offer was made and accepted; a mortgage deed was entered into;

signed, that is to say by the borrowers in the presence of a witness; presented to the

lender; dated by the lender 10th

August 2007, even though it may have been signed by

them a few days earlier; and duly registered. Arrears ultimately have allegedly arisen.

According again to the evidence put forward by the respondent, attempts to resolve the

matter were ineffective and on 2nd

November 2011 possession proceedings were

issued.

6. Things then went awry procedurally. There was a hearing listed for 14th

December

2011. As I understand it, and it is not a matter circuit judges normally delve into, the

possession proceedings were pursued under the procedure set out in CPR 55 which

relates to possession claims on mortgaged residential property. It is an accelerated

procedure in which what happens is the hearing is listed and a judge decides whether

there is any arguable defence. If not, there is a possession order; if so directions are

given.

7. On the date of the hearing, it seems that some evidence was lodged to indicate that a

gentleman by the name of Mr Allen might have purchased the property, with or

without notice of the charge was unclear, and the matter seems to have been adjourned.

It came before DJ Bury on 6th

February 2012 and he made an order for possession in

the absence of the defendant.

8. It now appears not to be disputed but that on the day before that and possibly after the

court closed for official business a draft defence was submitted on behalf of Mrs

Lamb. It appears between pages 34 and 40 of the 63-page bundle lodged by her in

these appellant proceedings and I will come to that in detail, but in simple terms it

raises certain procedural issues. It complains about the absence of an allocation

questionnaire but, more substantially, it raises a number of issues as to enforceability.

It makes the point that the relevant mortgage deed when signed was undated. It says

that it is not accepted that the loan is valid or secured and although there is reference

rather bizarrely to 14th

Century statutes, of much more importance is the reference to

the recent legislation about land registration and documentary execution. The defence

specifically pleads reference to section 2(3) of the Law of Property (Miscellaneous

Provisions) Act 1989 and it is said that the document is a nullity, essentially, as I

understand it, because it has not been signed by both parties. There is reference to the

Land Registration Act 1925 but, oddly, there is no reference to the statute that is now

said to be vital, which is the Land Registration Act of 2002. Whether this defence in

its current draft form may require amendment if permission is granted is another

matter, but it certainly sets out a defence to the effect that the respondents have no

right of possession because the document upon which they seek to rely is a nullity for

want of registration. Well, that defence was not before the court, but when the

appellant made an appeal against the decision of DJ Bury, it was appreciated that what

she was really doing procedurally was seeking to restore the application because she

had not been present and she had reasons for not being present.

9. The matter came on that application to set aside before the court on 26th

April 2012.

DJ Bury was the judge. There is nothing wrong with DJ Bury having been the judge.

A judge who has made an order in the absence of parties can and, indeed, ideally

should be the person who decides whether to set it aside, but for some reason not really



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clear to me, the defendant Mrs Lamb either decided or had been advised to make a

complaint that DJ Bury should not be dealing with the case. Unfortunately for her,

that complaint appears to have come to his attention at a point at which he had already

provisionally decided, it seems, to grant her the application she sought. There is

certainly a suggestion, if no more, that DJ Bury, being the very fair judge that in fact

he is, (which is why it was extremely ill-advised to make the complaint) was going to

find for Mrs Lamb but when he realised that she had made a complaint against him, he

could not carry on. He had to recuse himself and, accordingly, the application came

before DJ McQueen on 12th

July 2012.

10. That was, of course, unfortunate for Mrs Lamb because DJ McQueen is an equally fair

judge but since he had not been the judge who had originally made the order in

absence, he was perhaps less sympathetic to Mrs Lamb as a new litigant. He had

before him the application, effectively an application to set aside together with an

application for permission to rely upon the defence and, indeed, permission to file a

counterclaim. He dismissed those applications.

11. I have his transcript of judgment before me. It is detailed. It lasts for nearly six pages

and, in simple terms, what he said was, first of all, he had to consider the application to

set aside in the context of CPR 39.5 by analogy. He was right. He was bound by the

decision of London Borough of Hackney v Findlay [2011] EWCA Civ 8, which

required him so to do. So he applied the proper test and he realised in doing so that

under 39.5 before he could allow the matter to go forward and the order to be set aside,

he would have to consider, among other things, the three tests in 39.3. They include

consideration of whether the person in question has acted promptly; whether they have

a good reason for not attending; and whether they have a reasonable prospect of

success. Now, 39.3 refers to trials, but the Court of Appeal in that case says that it

applies by analogy. What DJ McQueen did was to come to the conclusion that he

accepted that she had acted promptly; he accepted her good reason, and I say no more

about it; but he did not accept that she had a reasonable prospect of success at trial. He

looked at her defence and he came to the conclusion that there was nothing in it, no

reasonable prospect of success, and, in effect, that is the point that the appellant now

appeals. She says that she did have a reasonable prospect of success. Her defence was

at the very least reasonably arguable.

12. Looking at the points in the defence, there is nothing in the point about allocation

questionnaires. That is a misunderstanding by reference to CPR 26 which does not

apply in these cases. But as to the substance of it, the case was argued on her behalf

by Mr Easeman. He is described as “McKenzie Friend” but if he argued it on her

behalf, he was her lay representative. I had Mr Easeman in front of me when the

matter came before me on a previous occasion, 10th

September 2012. Mr Easeman

was an articulate gentleman but, if he will forgive me for saying so, he did not make

the case as clear as Mr Fergus, who is the person who has appeared today, has done to

me. Mrs Lamb, I was told, although obviously an intelligent lady, is not a person who

was able to argue the case without assistance and, therefore, she has had assistance and

I am happy to allow Mr Fergus to represent her. I say that even though Mr Fergus

very frankly has conceded in the argument that he has a personal interest not in this

case but in the issues which arise because he is himself an appellant before a judge in

the Lambeth County Court where a similar point has arisen. He tells me that HHJ

Blunsden in Lambeth, as, I suppose, surprised at the point as I was and as unable



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without further enquiry to deal with the full merits on appeal, has adjourned his matter

for research purposes, apparently saying that he might well, if granting permission,

seek to refer the matter directly to the Court of Appeal. That indicates how interesting

and serious the case may be. So even though Mr Fergus has that interest in the matter,

I did not find that he was being unhelpful. I did not find that he was seeking to present

his own case. He was assisting Mrs Lamb and it is plain to me, from looking at Mrs

Lamb and her slightly distracted and detached attitude, that she is certainly not a

person who would have been able to argue this case as well as has been done on her

behalf by Mr Fergus.

13. Now, Mr Easeman before the district judge seems to have stressed, not as was stressed

before me today section 27 of the Land Registration Act 2002, but section 2 of the

Law of Property (Miscellaneous Provisions) Act 1989. In simple terms, as I

understand it now, the argument goes that the mortgage deed upon which the

respondent relies, which is the document signed by Mr Hellak and Mrs Lamb, the

document dated 10th

August 2007 by the respondents, the deed undoubtedly that they

executed in the presence of a witness, which on traditional analysis is the mortgage

deed - it describes itself as “This mortgage deed” - and which asserts that thereby the

borrower charges the relevant property and which includes a request for an entry on

the Register, is not in fact the mortgage. That, having regard to the provisions of

section 27 of the Land Registration Act 2002, perhaps inadvertently and

unintentionally, Parliament has introduced a provision which makes this document of

itself no longer the mortgage. The argument carefully put by Mr Fergus, and I hope I

understand it in substance, is that the reality is that a mortgage is only now created and

enforceable at law once it is properly and duly registered and that which must be

properly and duly registered is a contract to create a mortgage contract, and the

contract by reason of section 2 of the 1989 Act should be signed not only by the

borrowers, but by the lender. It is not a deed of course: it is a contract, so it has to

have both parties as signatories to it.

14. The sophisticated argument, and I put it that way because I am not prepared to take the

view that it is anything other than an honest argument - it may turn out to be false but

the argument is sophisticated - goes along these lines. When the respondents

registered this bit of paper, they were not registering a mortgage. They were not

registering a document, a disposition, caught by section 2 of the 1989 Act because of

the amendments to the law made by section 27 of the 2002 Act, a point which appears

not to have been appreciated even at the highest echelons of the Court of Appeal in

cases subsequently decided. Therefore, since they have not registered at the Land

Registry a contract signed by both parties, that which has been registered is a nullity.

If the document at the Registry or registered at the Land Registry is a nullity and the

registration is therefore ineffective, then they have no right to enforce at law the

purported mortgage. They have no right to possession or to seek an order from the

court. They may have a right to recover the debt, but they do not have an ability or

right to enforce by action for possession.

15. It is not, says Mr Fergus, just another clever way for debtors to avoid their debt. It is

he says a serious point which someone has identified which has found its way on to the

internet and generated a very substantial amount of confusing and contradictory

material closely typed, but, essentially, at its root there is an argument that the effect of

section 27 of the 2002 Act is to render mortgage deeds of this kind not themselves the



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mortgage capable of registration, but merely a contract for a future mortgage which

requires to be signed by both parties (and this is not).

16. Well, I do not believe the district judge had that argument fully put before him by Mr

Easeman. The way the district judge dealt with the argument was to say this: he

understood there was a section 2 argument; he understood that there was an argument

that because this document was not signed by both parties, it could not be relied upon;

but he did not, it seems, have section 27 of the 2002 Act put to him. He dealt with the

point about the absence of date and, in accordance with previous conveyancing

practice, and I think rightly, he said that the fact that there was no date on the

document was not of itself a problem. The deed could be perfected by the addition of

the date because it did not need further signature. He is probably right about that. I

defer to a former solicitor judge who is used to conveyancing. There is nothing in that

point, but he said this at paragraph 9:

“There then appears to be an argument with regard to section 2 of the Law

of Property (Miscellaneous Provisions) Act 1989. I have before me the case

of Helden v Strathmore Ltd [2011] EWCA Civ 542, which makes it clear to

me that section does not apply to this particular mortgage. It was not a

charge for the future. Even if it were signed technically three or four days

before completion took place, that was to enable the matters to be perfected

on the day and authority was effectively given to the solicitors to do that, so

again I find no compelling reason as to why that argument should succeed at

trial.”

In effect, he found there was no reasonable prospect of success.

17. Then he dealt with the Mr Allen point, saying that if this was a valid legal charge, a

valid mortgage properly registered, then Mr Allen would take subject to it, and that too

seems to me to be an unremarkable point.

18. So what the judge did, effectively, was to say that the substance of the defence was one

with no reasonable prospect. Therefore, there was no justification for setting aside the

possession order or for making the other orders that were asked for.

19. Now, the difficulty is this. I have also been shown the case of Helden v Strathmore

[2011] EWCA Civ 542, a decision of Lord Neuberger MR, Smith LJ and Elias LJ,

decided in May 2011, and it is absolutely right to say, as the district judge did, that at

paragraphs 27 and 28 of that judgment the Master of the Rolls described a case being

put in a very similar fashion to that before me with the sole exception of the 2002 Act

as being “hopeless”. He described it as proceeding on a fundamental

misunderstanding of the reach and purpose of the section, section 2, a

misunderstanding which was not uncommon. He made the point that section 2 is

concerned with contracts for the creation or sale of legal estates or interest in land and

not with documents which actually create or transfer such estates. A contract for a

mortgage in the future, he said, would be within the reach of section 2. An actual

mortgage would not. They held in that case that the document in Mr Helden’s case

was an actual disposition. Accordingly, section 2 did not apply and the reference to

section 53 of the Law of Property Act in that very same case was not relevant.



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20. Now, the district judge applied that case and he applied it because he took the view,

based on that case, that the mortgage deed to which I have referred was indeed not a

contract for a mortgage in the future but an actual mortgage. If it is an actual

mortgage, it is not within the scope of section 2 and the question of the signatures does

not arise and we are then back to simple registration of a mortgage. If, however, it is a

contract to create a mortgage in the future, as Mr Fergus submits on behalf of Mrs

Lamb, then it is caught by section 2. Now, as the matter was put to the district judge

by Mr Easeman, he was bound by the decision of the Court of Appeal. Indeed, I

would be bound by the decision of the Court of Appeal in Helden to hold that the case

is hopeless and therefore has no reasonable prospect because if it is simply based upon

section 2 and if one understands the Master of the Rolls to be saying that a document

such as the mortgage deed I have before me dated 10th

August is the “actual

mortgage”, then there is nothing unusual or remarkable about this case and the district

judge would have been correct.

21. Let me just quote for completeness section 2 of the 1989 Act. It says this at subsection

(1):

“A contract for the sale or other disposition of an interest in land can only be

made in writing and only by incorporating all the terms which the parties

have expressly agreed in one document or, where contracts are exchanged,

in each.

(2) The terms may be incorporated in a document either by being set out in it

or by reference to some other document.”

Pausing there, the mortgage deed may be said to be a document which incorporates the

mortgage conditions. It says it does. It is also a document which purports to be a

disposition of land but if in fact it is not that but a contract for a mortgage in the future,

it is caught by section 2 and section 2 subsection (3) says that such a document, that is

to say a document caught by section 2, must not only incorporate all those terms but

must be signed, “By or on behalf of each party to the contract”.

22. So if this document is caught by section 2, then under section 2(3), on the face of it, it

does not comply with the requirement for signature by both parties. If it is a contract

for a mortgage in the future caught by section 2, it does not comply. If it is an actual

mortgage, it is not within section 2 at all and it is perfectly valid as a mortgage deed. It

is the mortgage in itself.

23. Now, no reference appears to be made to the 2002 Act in Helden v Strathmore Ltd.

Mr Fergus’ point, in effect - he does not make it this way but I make it for him as a

lawyer - is that Helden v Strathmore Ltd is distinguishable and does not cover this case

because it does not deal with the argument that is being put forward. It has been

suggested on the internet that it is per incuriam. Well, that is not right in my

judgment. If I understand a per incuriam judgment to be one which has not taken into

account matters brought to the court’s attention, this is a case in which the court did

not have brought to its attention the relevant statute and, allowing for the fact that the

judges are highly experienced, they are not expected to know all the law and if they

have not got the point taken before them, they can only decide it on that case.

However, it means that if they did not decide it, if it really is a different point, if it is

distinguishable, then DJ McQueen was not bound by it and I would not be bound by it



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and HHJ Blunsden in Lambeth would not be bound by it. That is the real question in

this case.

24. What does section 27 say? Section 27 says:

“(1) If a disposition of a registered estate or registered charge is required to

be completed by registration, it does not operate at law until the relevant

registration requirements are met.

(2) In the case of a registered estate, the following are the dispositions which

are required to be completed by registration.”

And among them is:

“(f) the grant of a legal charge.”

The appellant’s argument is, therefore, that at best this mortgage deed is not an actual

mortgage but a contract for a mortgage and it is a disposition which is required to be

completed by registration but only if it satisfies section 2 of the 1989 Act. My

question was: why does the registration of this mortgage deed, which took place some

time later, it is conceded, not complete the mortgage and make it enforceable; to which

the argument is that that would be all very well if it had been signed by both sides.

Under section 27, then it would have been a disposition, registration would have

completed it and it would have been operative at law, but it is not signed by both sides,

and since it is not, therefore, it is argued, an actual mortgage, section 2 is in play. So

one way or another, says the appellant, this is a matter where the respondents are

unable to satisfy the combined requirements of these rather convoluted statutes.

25. Whether this was intended, if it is right, is unclear. Westlaw Statutes, which I was able

to consult in the short adjournment, makes this point by reference to the High Court

Chancery case of Thompson v Foy, which no doubt the respondents will wish to have a

look at. Thompson v Foy [2009] EWHC 1076 (Ch) was a decision in which it was

held. (Section 27 of the 2002 Act was considered in that case):

“First, section 27(2)(f) identifies the disposition as the grant of a legal

charge.”

It is right, if one looks at it, the disposition is the grant of a legal charge.

“It is the disposition which is the grant of the legal charge, not its

completion by registration.”

In other words, it is arguable that the registration does not create the charge. It merely

completes it and “completion” is the word used in section 27, not “creation”.

“Secondly, the language of section 29 of the Act contemplates that the time

of disposition and the time of registration may be different.”

26. So that was a slightly different point and a different case, but there is at least some

argument that section 27 of the 2002 Act may be relevant to these issues. It may,

however, be that that it is the registration that creates the mortgage is wrong and that it

is only the registration that completes the mortgage, completes the disposition, the



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disposition being made by the charge and then the only question is whether that

mortgage deed document is the charge or a contract for a mortgage.

27. In granting permission to appeal, I remind myself of the test under rule 52 of the CPR.

I should only grant permission to appeal if I am persuaded by the appellant that there is

a real prospect of success. By “real prospect of success” under rule 52.3(6)(a) is meant

a real prospect of successfully showing that the district judge was wrong. That is rule

52.11(3)(a). I am satisfied, although it is a difficult point, that there is here an

undecided issue, an undecided issue which meant that the district judge may have been

wrong, and there is a real prospect therefore of showing he was wrong because “real

prospect” means something that is not fanciful - not fanciful: realistic; it does not mean

it is bound to succeed - and that he was wrong because he did not have the argument

put before him by Mr Easeman then representing the appellant and that he did not

appreciate that the point was that Helden v Strathmore Ltd was either wrongly decided

or at the very least did not cover the point he was deciding. If he had come to that

view, he might have taken a different view.

28. I bear in mind that DJ Bury without the benefit of any of these arguments may have

been minded to grant the application to set aside, which means that the exclusion of the

past 12 months might not have happened. I bear that in mind when considering

whether anything I have done today, whether by refusing the adjournment or granting

permission, may be thought to be prejudicial to the interests of the respondent.

29. So permission is granted to appeal, the test being whether the decision to refuse the

original application is wrong and exceeded the generous ambit within which

reasonable disagreement is possible. I am not deciding the case because I would have

allowed the application. The district judge might, if he had understood the argument,

had it put to him and considered it, then have said that he still did not think that the

point was a good one. He might have said that he did not think that Helden v

Strathmore Ltd could be distinguished. If he had gone about it that way, I probably

would not have given permission to appeal at all and then the appellant would have

been left with the question of whether to take separate proceedings or to apply to the

Divisional Court for a judicial review but, as it is, he did not address it. I think,

therefore, that there is a real prospect of showing that he is wrong, that the argument

that this section 27 of the 2002 Act arises is not fanciful, albeit novel and albeit that

even a judge as highly experienced as the Master of the Rolls, as he then was, Lord

Neuberger, did not appreciate the point. Equally, there is a case cited to me dated from

2001, but that is a case in which Mummery LJ took a similar view but before the

coming into effect of the 2002 Act, so by definition the Court of Appeal did not have

to consider in that case of Eagle Star v Green & Challis [2001] EWCA Civ 1389 the

precise point. That is not to say that the reasoning of Mummery LJ, a highly

experienced Court of Appeal judge, on the point is not still reliable, and it may not be

the case that the 2002 Act has made a difference.

30. It may also be that this is a case which will have to go to the Court of Appeal or the

Supreme Court in due course. Unlike HHJ Blunsden, I do not immediately think that

upon granting permission to appeal I should order that this case be transferred

immediately to the Court of Appeal. It seems to me that that would be premature,

bearing in mind that the appeal may reveal arguments which answer the point. Further

research may indeed reveal that there are authorities which are binding on this court.



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31. It is worth bearing in mind the case of Pepper (Inspector of Taxes) v Hart [1992]

UKHL 3. Pepper v Hart is the case which says that reference may be made to those

things that are said in Parliament when acts are passed. It is very far from clear that

the argument being suggested to me was intended by the Government when this Act

was brought into force. On Westlaw there is a quote from the speech at the report

stage of the bill by the Parliamentary Secretary to the Lord Chancellor’s Department,

Baroness Scotland, who referred to the Government’s purposes in relation to section

27. There is nothing in what she said indicating that the Government consciously

realised or intended to alter the conveyancing law relating to mortgages, nor that they

had any view that they were in any way altering the operation of section 2 of the 1989

Act or section 52 of the Law of Property Act. Indeed, she specifically refers to the

requirements for transfers under section 52 and although she talked about compulsory

registration of title, she did not, as I say, say anything to indicate that the Government

intended to make the sort of change that this case would suggest they may have made

inadvertently.

32. The appellant has an uphill task, I should have thought, but it may be there are other

cases. It may be that HHJ Blunsden will make his decision before I make mine. If

indeed he does make his decision in a way that either involves permission to Mr

Fergus with a direction that the matter go to the Court of Appeal and that appears

before this appeal comes on, I will stay the appeal pending the decision of the Court of

Appeal in this case. Similarly, if the respondents are able to find that any other cases

have already been decided and either sent to the Court of Appeal or referred or

appealed to the Court of Appeal, there may be an application for a stay. There is no

point whatever in a series of circuit judges around the country making different

decisions, especially when those circuit judges are not chancery lawyers and who have

put before them arguments by unrepresented parties.

33. However, I am not going to send this to the Court of Appeal. It seems to me that now

the point has been identified, it is one that can be properly determined and I am more

than happy to determine the actual question, which is whether DJ McQueen was wrong

to refuse to set aside the possession order in this case.

34. The stay of execution on the possession order will remain in accordance with my

previous order which was made on 10th

September 2012. That is to say the execution

of the warrant will remain suspended, but it does anyway because the order says it will

be suspended until the determination of the application for permission to appeal or, if

granted, the appeal or further order. Since I have not yet determined the appeal, I

would not dream of removing the stay, so Mrs Lamb lives to fight from her home

another day.

35. Time is not available today but, in any event, it is clear to me that these are matters that

may one day have to come to the attention of the Supreme Court of the United

Kingdom. I am certainly not prepared to rush at such a case in which my judgment

may be one of those which is considered and, accordingly, I will direct that the hearing

of the appeal itself shall be listed on the first available date with an estimate of one full

day. Both parties may, if they wish, submit further skeleton arguments and may cite to

the court any further authorities. I will not entertain authorities that contain editorial

material from the internet. When authorities are cited to the court, they are to be cited

either in the published public version or in the version on the internet which is the

handed-down version without interpolation. Interpolation is a matter for submissions.



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36. I will not permit any further evidence to be lodged in this case by either side. This is

plainly a legal point, not a point for evidence. If evidence is ever required, it will be

following the grant of the appeal and the return of this case to the district judge for the

giving of directions for trial. The appeal will consist of a hearing upon the law, no

further evidence; and skeleton arguments, if so advised, and law reports, if required, to

be lodged with the court not later than four days before the hearing. I make it clear, if

I can find the precise rule, that neither today nor on any future occasion in this matter

will I permit any evidence to be adduced which was not before the district judge at the

time of his decision on 12th

July 2012. The rule to that effect is 52.11(2):

“The appeal court will not receive evidence which was not before the lower

court unless otherwise ordered.”

I do not otherwise order and I will not otherwise order.

MR FERGUS: Is that the CPR?

THE JUDGE: CPR 52.11. We will deal with this matter on the point of law which Mr

Fergus has very articulately brought to my attention. It is extremely interesting. If

section 27 of the 2002 Act has had the effect which he indicates, then this is a matter

of considerable importance to mortgage possession cases of residential property. I

make no decision about it. I am going to look in some detail at the authorities when I

have the opportunity. I will retain the skeleton argument and all the documents that

have been disclosed to me so far for the next hearing.

If either of the parties have any dates within the next six months when they know they

will not be available to attend the one day hearing, they should inform the diary

manager within seven days of today. Otherwise, the court will simply find a date

which is the first available and it will list the case. The hearing notice will be sent out.

If, of course, the hearing notice is for a date that has subsequently become

inappropriate, then the parties will be able to apply.

I should say for the record I have put the detailed 6-page chronology on the file, but I

do not think, Miss Mayoh, you have seen it, so I will ask the court clerk if she will...

Have you got one now?

MISS MAYOH: Yes.

THE JUDGE: You have it.

MISS MAYOH: Yes, I have it. Yes, thank you.

THE JUDGE: All right. Thank you, I will keep that on the file and this interesting case will

be heard. Now, if Mrs Lamb, you are able to obtain legal representation, I am sure that

will be extremely good but, equally, Mr Fergus seems to be entirely on top of the point

for obvious reasons and so you may either attend on the next occasion with him to

assist you. Can I urge you against changing your representative though because, in a

sense, you have succeeded today because Mr Fergus has been able to articulate the

point in a way that Mr Easeman was not? It would be unfortunate if you were not to

have the assistance of Mr Fergus, who knows the point, or a legal representative who



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knows the point. People have failed, as indeed it seems to me you may well have done

before the district judge, for lack of a proper argument being properly put.

Miss Mayoh, I am grateful for your assistance. As I say, if there are to be any skeleton

arguments on both sides or any further authorities cited, they are to be lodged with the

court not later than three days before the hearing date ultimately set and if either party

learns of a decision by any other court of first instance which is thought to be likely to

bring this matter to the attention of the Court of Appeal before we can resolve it

ourselves, they should inform me and make such applications as may be appropriate.

Very good. Thank you very much indeed and thank you to—

MR FERGUS: Sorry, could I just clarify, when you said about when you are going to list

this matter for the first available date and if either party has any dates when they are

not going to be available, does that include either party and their representative or—

THE JUDGE: Yes. It is you too. If she wants you to come, then you too. So if you know

already there are some dates but, if not, write a letter, send an email. Mrs Lamb knows

how to do that. There are a lot of emails here to the court. Send within seven days to

the court the list of days when you cannot do it. Obviously, public holidays we are not

here anyway and I have said six months just to give us the maximum room for

flexibility. The courts are very busy at the moment. They are not helped by cases of

this type which take longer than they would if all sides were represented. That is not

your fault. What I am saying is effectively 1st February to 1

st July.

MR FERGUS: Should that letter be addressed to the court manager or to yourself?

THE JUDGE: The court manager or diary manager.

MR FERGUS: Diary manager.

THE JUDGE: Whoever you have been sending things to previously. The diary manager is

called Miss Darwen, D-A-R-W-E-N, but if you send an email to Preston County Court

saying that this is for her attention, it will find her.

MRS LAMB: To be at Preston then?

THE JUDGE: Well, it is a Preston case. The only reason we are here is because the courts

in Preston are closed or going to be closed for three months for building work to be

done, so Preston cases are taken in Burnley, Blackpool and Lancaster until then.

MRS LAMB: It started in Burnley.

THE JUDGE: Appeals are taken in Preston.

MRS LAMB: All right.

THE JUDGE: You might end up in Burnley if that is where we happen to be sitting.

Hopefully, in six months the work will be done, but the hearing notice will tell you

where it is. I make no bones; I apologise to you for the fact that that is an uncertainty,



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but it is forced upon us because we simply do not have the court to use in Preston at

least until Easter, starting next week.

MR FERGUS: One other thing I would like to clarify, where you made reference to “the

court of first instance”, would the County Court be the court of—

THE JUDGE: That is what I mean. I mean a circuit judge in the County Court or a High

Court judge in the High Court, but these things will not get to a High Court judge. I

mean the circuit judge. I am not too interested if other district judges make decisions.

It is only if it gets to a circuit judge, who may refer it to the Court of Appeal or against

whom an appeal goes to the Court of Appeal. As I say, it is not a point likely to go

away, so if someone else gets in first, there is no point in costs being incurred by you if

the point is the same point. Thank you. I will rise.

[Hearing ends]


Apple Transcription Limited 151-2381-1/ma 0845 604 5642 v.3

IN THE BLACKPOOL COUNTY COURT Claim No. 1PB48636

The Law Courts

Chapel Street

Blackpool

FY1 5RJ

Tuesday, 15th

January 2013

Before:

HIS HONOUR JUDGE BUTLER

Between:

THE MORTGAGE BUSINESS PLC

Claimant

-v-

MRS TILLEY LAMB

Defendant

______________________

Counsel for the Claimant: MISS MAYOH

Lay Representative for the Defendant: MR FERGUS

______________________

TRANSCRIPT OF PROCEEDINGS UP TO JUDGMENT

Transcribed from the Official Tape Recording by

Apple Transcription Limited

Suite 104, Kingfisher Business Centre, Burnley Road, Rawtenstall, Lancashire BB4 8ES

Telephone: 0845 604 5642 – Fax: 01706 870838

Number of Folios: 156

Number of Words: 11,202


Apple Transcription Limited 1 151-2381-1/ma

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[The quality of the recording was poor;

the transcriber has endeavoured to provide as accurate a transcript as possible.]

THE JUDGE: Good afternoon, Mrs Lamb. I understand you have Mr Fergus, is that right,

who is with you, let me be clear, in order to argue your case or simply to provide you

with assistance while you argue it yourself?

MRS LAMB: To argue the case.

THE JUDGE: You are here to argue the case as a lay representative?

MR FERGUS: As a lay representative.

THE JUDGE: Can I ask how you have come into it because Mr Easeman was doing that in

the past, was he not?

MR FERGUS: Yes. I am not entirely familiar with all the issues of this case. I know it

goes back some time, but Mr Easeman is basically no longer available and Mrs Lamb

finds it really difficult to deal with the situation and finds it difficult to speak to people

and she finds it difficult to deal with people, so she is not able to articulate the

arguments that she is relying on herself.

THE JUDGE: All right. You say you are not entirely familiar. Are you happy that you are

going to be able to deal with it for her?

MR FERGUS: Yes. I am happy that I can deal with the issues that would need to be

addressed in order to receive permission to appeal, which is what the application is for

today.

THE JUDGE: All right. You can sit or stand as you wish. The microphone there in front

of you, I do not think it amplifies but it records, so it might be an idea if you swap

places with Mrs Lamb so that you are closer to the mike.

MR FERGUS: Would be it possible to turn it?

THE JUDGE: Well, you could but it does not always operate as well with that, but try that

if you want. All right. You stand or sit as you wish. Miss Mayoh, you are for the

respondents in the matter.

MISS MAYOH: Your honour, yes.

THE JUDGE: Can I just apologise to all parties in court for the delayed start? I am afraid

that we had eight small matters plus a substantial appeal this morning. The eight small

matters we managed to get rid of by eleven o’clock but, unfortunately, the appeal went

part heard beyond lunchtime. I am conscious that at ten to three we do not realistically

have the two hours that have been set aside for the case and I am also a little

concerned, having regard to the additional things that have been filed most recently on

Mrs Lamb’s behalf, as to the time estimate. Can I ask now before we start whether if

we went over until tomorrow morning you would be able to come?



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MR FERGUS: It would be difficult for me to come because I have got my train booked. I

have got my train booked for London.

THE JUDGE: Train, sorry. What about you, Miss Mayoh, are you available?

MISS MAYOH: It is booked as a holiday. I think I am available in the morning.

THE JUDGE: I am concerned, you see, that this is not a straightforward matter, in the sense

that there is a lot of detail presented on Mrs Lamb’s behalf which needs to be looked at

and certainly experience teaches in cases of this kind, whichever way it goes, that if

one does not have the amount of time normally available within the normal hours,

especially when one has done the solid work beforehand, there comes a point when the

judgment is not as clear as it might be and so I certainly hold open the possibility of

going over to tomorrow at least for judgment because I think it is unlikely, unless

things are shortened, that we will get to judgment. I think we better see how we get

on. What I do not want to do is to adjourn the case to another date. I appreciate all

parties have waited a long time for this and it is not your fault, either of you. It is the

fact that the case before you went on longer than it had been hoped it would.

MISS MAYOH: I understand your honour’s concerns.

THE JUDGE: Well, let us proceed [inaudible] and see where we get to. Now, Mr Fergus,

given that Mrs Lamb is the appellant or the person seeking permission, the normal

procedure is for her to make her submissions first and then for the other side to reply,

if they wish to do so on permission. If you would prefer to hear Miss Mayoh’s

response first in order to focus it, you may. I hope you have had the opportunity of

looking at the skeleton argument that has been presented on behalf of The Mortgage

Business by Miss Mayoh. You have got that, have you?

MRS LAMB: Excuse me, I am supposed to give you this to begin with. Could I give it you

now?

THE JUDGE: Just pass it to [inaudible].

MRS LAMB: It is a document for permission to appeal if things do not go my way and I

need to give it to you now.

THE JUDGE: No. Well, I cannot do that. You do not need to give it to me now, actually.

If I refuse you permission to appeal, there is no further appeal in law from that. If I

give you permission to appeal and then refuse the appeal, I cannot give you

permission. You have to go to the Court of Appeal in London in order to get

permission because it would be what is called a second appeal. I would not worry too

much about what is going to happen if you lose. I think the question is to focus on the

matters on which you say you ought to win and we will worry about the further

hearings, if any, thereafter.

MRS LAMB: I just thought it was something about reasons for not granting—

THE JUDGE: Yes. Well, I have not decided it yet, you see, so I cannot give you reasons

for refusing until I have refused and I have not refused yet and, even if I did, I repeat, I



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am sorry, the procedure is that you can appeal to me from the district judge and you

can appeal from me to the Court of Appeal but I can not give you permission to go to

the Court of Appeal. Only the Court of Appeal can give you permission to go to the

Court of Appeal. So if you were to be in that position, you would have to go to that

court. If I grant the permission, of course, what I am granting is the permission to

allow you to defend the claim so it then goes back to the district judge or one of them

to make the necessary directions about how the case shall proceed.

MR FERGUS: Yes because we have not had a trial on this matter, have we?

THE JUDGE: No. What you have had is you had the application. Let me state, so you

know what I know and you can correct me. You sit down, Mr Fergus.

MR FERGUS: Can we just give you this chronology? This is our chronology of events

surrounding this matter, so it may be useful for everyone to have a copy.

THE JUDGE: Yes, it is and that is why I am a bit worried about the time it may take. Let

me tell you what I know and we can go to this certainly in a moment. You stay seated,

if you wish. The Mortgage Business issued these proceedings on 2nd

November and

the matter is brought on for a first hearing on 14th

December and on 6th

February it

comes before DJ Bury and Mrs Lamb was not in attendance and he made an order. So

that is the basic starting point of the case. What you say is or you said or she said was

that there had been a defence which had been filed at court the night before,

6th

February, and which had obviously not got in front of the judge and you said that if

he had seen that defence, he would not have made the order for possession and so you

applied or you appealed, as it was, but the proper procedure is to apply to set aside the

order. So your application was treated, as it should be, as an application to set aside

the order and it came back before DJ Bury on 26th

April but, unfortunately, Mrs Lamb

had either of her own volition or been advised to complain that DJ Bury was going to

be a judge in his own court and she had made a complaint about that and because of

that complaint, he had no alternative but to step back from the case.

Now, the difficulty with that was, of course, the rule is that the judge who has made

the order can decide on whether to set it aside, so he was acting perfectly properly to

hear it and, ironically, it is said on your behalf, Mrs Lamb, that in reality he was

minded to grant your application and had it not been for your complaint against him so

he had to step back, he might well have made the order you wanted, leaving The

Mortgage Business either to take it on the chin and deal with it or themselves to

appeal.

Having unfortunately taken that measure which removed the judge who was with you,

it had to be heard then by DJ McQueen and that is the judgment that you seek to set

aside. That judgment is set out in a transcript, a copy of which I have seen, and he was

given that document, the document of the kind that you were referring me to, and,

essentially, he has taken the view that, first of all, the business of allocation

questionnaires was a procedural error on your advisor’s part. In other words, there was

no need for an allocation questionnaire because of the rules but, more importantly, he

came to the view that nothing in your defence amounted to a defence. That is the

decision that you appeal or apply to appeal. So you have to satisfy me that there is a

real prospect of showing that he was wrong about that and if I give you permission on



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that basis, then you would have to persuade me that he was actually wrong about that

and, if you do that, the case goes back either to him or to one of the other district

judges to recommence from the point at which the defence would have been filed,

which is he would give various directions as to what should be done. That would be

the procedure.

Now, that is what I have read and I have seen, therefore, that what you say is that, first

of all, orders should not have been made. He should have allowed you to file your

defence and you say that he was wrong in his view that there was nothing in that

defence and I think it was still said on your behalf that there was the point about lack

of allocation questionnaires.

MR FERGUS: Can I clarify something, if I may?

THE JUDGE: Yes.

MR FERGUS: Is it accepted that a defence was filed or is it disputed that a defence was

filed?

THE JUDGE: Miss Mayoh, I think it is accepted, is it not, that a defence document had

arrived at court but had not been seen by the district judge on 6th

February, but it was

before the judge on 12th

July?

MISS MAYOH: That is correct, sir.

THE JUDGE: Yes. All right. So it is accepted that that defence was filed. Now, in the

absence of a proper trial bundle because I know that you filed a bundle with your

appellant’s notice but it has not been, I think, subsequently updated, I can only work

from the documents I have got. The defence in question is at page 24 of Mrs Lamb’s

appeal bundle and, apart from the point about the allocation questionnaire, it refers to

the fact that the documentation was undated. It says that that, accordingly, is fatal. It

is said that the property has been purchased by somebody else anyway. It is implied

that the deed is not valid. It is said that the documents incorporating the terms were

not executed in accordance with the regulations, or rather the provisions of the Act,

and that despite the fact that the mortgage was registered and that the advance was

made and has been enjoyed, nevertheless, it is a nullity and accordingly, they cannot

obtain possession on it and notwithstanding that the money was advanced, the

repayments such as have been made have to be repaid. The essence of it is it is said

that the mortgage was not valid and what has been registered is not properly registered.

So, now, can you encapsulate for me - never mind all the [inaudible] - in simple terms

what you say is the basic reason why the lender should not be able to enforce the

security?

MR FERGUS: I can encapsulate it. Can you just give me a minute?

THE JUDGE: Your voice is dropping a bit. You will have to speak up a little, please.

MR FERGUS: If you can just give me a minute, I will.



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THE JUDGE: Yes, absolutely. If you are going to persuade me the judge was wrong to say

your defence had no merit, you are going to have to persuade me of what that merit is,

so I can see that he got it wrong. While you are doing that, Miss Mayoh, I have two

bundles here. I have the 50 pages which were filed with the appellant’s notice and

then I have got the subsequent 63 page bundle which has been filed. Now, I am

working from the 63 page one myself. Is that what you have? There is a spare copy in

the file bundle, I think, Kathy.

MISS MAYOH: No, I do not have a bundle of any sort.

THE JUDGE: All right. Pass me the court file for a moment.

MISS MAYOH: I have the 50 pages that were filed with the appellant’s notice.

THE JUDGE: At some point - let me hand it down to you - Mrs Lamb—

MRS LAMB: Do you have the 33-page document that was sent five days ago?

MISS MAYOH: Yes.

THE JUDGE: Well, five days ago... I am just thinking about it at the moment. That is the

63 pages filed a long time ago. Give that to Miss Mayoh.

MISS MAYOH: Thank you.

THE JUDGE: Then a few days ago there were yet further documents—

MISS MAYOH: Yes, I have got that.

THE JUDGE: —which are here and which contain some authorities with some

interpolation. I will come to the authorities in detail in due course but...

MR FERGUS: It is not entirely easy to encapsulate briefly what our argument is as to why

The Mortgage Business has no possessionary rights but, in doing so, we are relying on

the Land Registration Act 2002, section 27(1).

THE JUDGE: All right.

MR FERGUS: The Land Registration Act 2002, subsection 27... Sorry, section 27(2)(f)

—

THE JUDGE: Yes.

MR FERGUS: —and the Law of Property Act (Miscellaneous Provisions) 1989, section

2(3) in particular.

THE JUDGE: Yes.

MR FERGUS: And we are also relying on the Law of Property Act 1925, section 52(2)(f).



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THE JUDGE: All right. What do you say the effect of that is because the other side say, do

they not, there is a mortgage deed here signed by Mrs Lamb and I think her late

husband, the other signatory, and they have registered that at the Land Registry? You

say, as I understand it, by reference to those statutes that the relevant contract has not

been registered or has not been registered properly.

MR FERGUS: I think what we are saying is the Land Registration Act 2002 section 27(1)

says the mortgage... well, word for word—

THE JUDGE: Read it please. Do not assume I know it. I do not. I do not know all the

law. The law is what?

MR FERGUS: Word for word, it says:

“If a disposition of a registered estate or registered charge...”

We would take the registered charge as the mortgage:

“... is required to be completed by registration, it does not operate at law

until the relevant registration requirements are met.”

THE JUDGE: Yes.

MR FERGUS: If we go to the Law of Property Act 1925, section 52(2)(g), it says:

“Conveyances to be by deed

1) All conveyances of land or of any interest therein are void for the purpose

of conveying or creating a legal estate unless made by deed.”

THE JUDGE: Yes, all right.

MR FERGUS: I think I have got that wrong. The Law of Property Act 1925, section 52(1)

says the conveyance should be made by deed but section 52(2)(g) says:

“This section does not apply [referring to subsection (1)] to...

(g) conveyances taking effect by operation of law.”

All right? So basically, what we are saying is often mortgage companies come in and

say that the mortgage has to be made by deed—

THE JUDGE: Yes.

MR FERGUS: —when in fact it does not. This says if it operates at law, i.e. it is not a

mortgage of equity, it is a mortgage at law which means that it is governed by statute,

in that case it can be by contract. It does not need to be by deed.


MR FERGUS: All right. So going back to the Law of Property Act 2002, Disposition of

The mortgage does not take effect until the relevant registration requirements are met.



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THE JUDGE: Yes.

MR FERGUS: The relevant registration requirements that should have been met are under

the Law of Property (Miscellaneous Provisions) 1989 section 2(3), which says that the

mortgage must be signed by both parties; all right? Now, we know Eagle Star

Insurance Company Ltd v Green & Anor [2001] EWCA Civ 1389 and Target Holdings

Ltd v Priestly 79 P&CR 305 and also Helden v Strathmore Ltd [2011] EWCA Civ 542

say that the deed... Now, obviously, you have read some of our earlier submissions we

have made, so we refer to the deed as the contract by deed because we say it is a deed

and a contract at the same time. It is a deed that is contained... it is a contract

contained in a deed.


MR FERGUS: All right. The deed needs to be signed by both parties, but they say section

2 of the 1989 Act does not apply because the deed is not a contract for the mortgage.

It is a contract of the mortgage.

THE JUDGE: Yes.

MR FERGUS: All right. We say they are wrong in that.

THE JUDGE: Hang on. You say the Court of Appeal is wrong?

MR FERGUS: We say they are wrong in that.

THE JUDGE: Well, I am bound by the Court of Appeal. I cannot find the Court of Appeal

to have got it wrong.

MR FERGUS: All right. I am not sure what the rule is but, obviously, if... Well, we say...

All right, there are two things. We say they are wrong in that because obviously none

of the case law actually takes into account or mentions the 2002 Act; all right? So we

say that is a whole statute that has been ignored.

THE JUDGE: It is a bold submission to make about a Court of Appeal in which I think the

judgment was given by Staughton LJ, who is an extremely experienced commercial

and property lawyer, and your suggestion is that that case has been wrongly decided?

MR FERGUS: My suggestion is the 2002 Act—

THE JUDGE: Neuberger, rather, not Staughton.

MR FERGUS: My suggestion is that the 2002 Act should have been taken into account

and it was not. It is an entire statute and we are basically relying on the 2002 Act to

highlight that a deed is not a contract out of, but it is a contract for the mortgage, and

that is one of the foundations that all these judgments rest upon: that the deed, which,

as I said before, we referred to as a contract by deed, is of the mortgage. All right?

So, in other words, they are saying the deed is the mortgage. Now, what we are saying

is even if before 2002 this was the case, the consequence of the 2002 Act meant that it



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could not be... the paper could not be the mortgage because the mortgage only took

place—

THE JUDGE: What do you say the mortgage consists of them?

MR FERGUS: The mortgage is electronic. The mortgage becomes electronic. The

mortgage is in the future. All right? When you sign the deed, it does not create the

mortgage. The mortgage does not come into effect until the relevant registration

requirements are met and those relevant registration requirements are not only because

it is for a future deed... a future mortgage, it needs to be signed by two parties, but also

because the actual mortgage is created electronically and it does not come into effect

or does not come into existence until it is registered electronically.

THE JUDGE: What then do you say should have to be registered that has not been

registered in this case? There is a contract or a document somewhere that has not been

electronically registered.

MR FERGUS: No, we are not... I think a lot of people are confusing that and I would

have preferred to go through the full argument, but you said you wanted—

THE JUDGE: Yes. Go on. I have to see if the district judge was wrong. Somebody in

2007, as I understand it, advanced the better part of a quarter of a million pounds

against the security of 14 Westminster Close. As I understand it, that is undisputed, is

it not?

MR FERGUS: Yes. That is... I am not sure whether that is disputed or not but, basically,

we are not arguing that there was not a loan made. We are not arguing that there is not

a balance outstanding. What we are arguing is that the lender, Mortgage Business, do

not have any rights of possession.

THE JUDGE: Yes. You are saying it was not secured against the property?

MR FERGUS: Yes.

THE JUDGE: Therefore, they cannot exercise the right to recover possession. Now, they

say that something was registered. Now, I am not quite sure at the moment whether

you are saying that that which was registered was the wrong document or that nothing

was registered. I am trying to work out what it is you say the mortgage consists of in

this case.

MR FERGUS: Do you have this document?

THE JUDGE: I have got a lot of those computer-generated documents but they do not

impress me. I am afraid I have got to have, not something that somebody has made up

on the internet: I have to have authorities to explain to me. You say Helden v

Strathmore Ltd is wrongly decided. I understand the point about that, but what I need

to know is when... Go back to square one. When Mortgage Business start their

proceedings, they say to the court, “We have the benefit of a mortgage deed” signed,

they would say, by the relevant persons who charged the property, the owners of the

property. That exists and they say they have registered it at the Land Registry and they



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refer to the title registration, do they not? Now, ordinarily, let us be frank, when

people come before the court, the judge looks at the Part 55 procedure: whether they

have verified the existence of the mortgage; they have shown the deed exists; and they

establish that it has been registered. Now, in this case it would appear that DJ Bury

was satisfied as to that. Where DJ Bury you say was misled was he did not know there

was a defence, but he was initially satisfied that the normal requirement of a mortgage

possession claim had been satisfied and you seem to be saying, if I understand you

correctly, that either there is not a mortgage deed and so there was no charge of the

property or there was a mortgage deed but it has not been registered in the proper

manner, either of which would give you a defence on the face of it because if there is

no deed, they cannot pursue their possession proceedings and if there is a deed but they

have not registered it, then they cannot rely on it because it cannot be enforced for

want of registration under the relevant statute. I understand that.

What I do not understand is exactly what is being said should have been but was not

registered electronically because the assertion by them is that there is a mortgage deed,

am I right, a document signed by two people, and that has been registered at the Land

Registry by whatever means it is normally done and has been accepted as such?

MISS MAYOH: Yes.

THE JUDGE: Fine. Now, do I have in the bundle a copy of the mortgage deed that you

rely upon?

MISS MAYOH: I have a copy.

THE JUDGE: All right. Well, let us see whether it is disputed that is the deed because that

may be the heart of the case. Let me see it first. Yes, all right. That is the document

that they say is the mortgage deed which has been registered. Show it to Mr Fergus

[inaudible]. We can copy it if necessary.

MR FERGUS: All right.

THE JUDGE: All right. Now, what do you say is wrong with that? That is the basis of

their case. They stand or fall on the existence of that because everything else follows

from that. What is wrong with it?

MR FERGUS: Well, the basis of what they are saying... They are saying this is the

mortgage, basically, which needs to be registered.

THE JUDGE: They are saying that is the mortgage deed, yes, signed by Mrs Lamb and the

other borrower at the time, witnessed by a solicitor’s representative. That, they say, is

the document - the deed.

MR FERGUS: Yes.




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MR FERGUS: All right. We are saying this is... As I understand it, they are saying this is

the mortgage: this is a charge and this is the mortgage; the charge and the mortgage are

the same thing.

THE JUDGE: Well, a charge and a mortgage are the same thing.


THE JUDGE: The full term is “Charge by way of legal mortgage”.

MR FERGUS: All right. So they are saying basically, “By signing this, you executed a

mortgage”. When you sign this, you execute the mortgage and the mortgage comes

into effect. That is basically what they are saying, so this is the mortgage. That is

what they are saying.

THE JUDGE: All right, yes.

MR FERGUS: What we are saying is this may have been the case prior to 2002, but as a

result of the Land Registration Act 2002 this no longer becomes the mortgage because

the mortgage only comes into effect and comes into existence once the relevant

registration requirements have been met and those registration requirements are that

the mortgage is created electronically - it is registered electronically. We are saying

there is a huge difference in Mrs Lamb’s case, that the gap in between the signing of

the deed and in between the mortgage being created by completion of electronic

registration is six months, so this highlights the fact that this cannot be the mortgage.

This cannot be the charge. Therefore, this becomes a contract for the mortgage and

not a contract of the mortgage. This is not the mortgage. The mortgage is electronic.

This is paper. The mortgage only comes into effect in—

THE JUDGE: Well, why did it not come into effect on that argument six months later when

it was registered?

MR FERGUS: Because the requirements have not been met. The signatures of both

parties on a contract for the disposition, as opposed to the Eagle Star, Target Holdings

and Helden cases, went on the premise that this is a contract of mortgage and not a

contract for mortgage. Basically, they said section 2 does not apply to contracts of, but

it does apply to contracts for.

THE JUDGE: So you say if that were a contract of mortgage, if it was not a mortgage there

and then, it is all right, but because it is a contract for a mortgage, it is not because

there is no registration?

MR FERGUS: We are not entirely saying that either but we are accepting all right, prior to

2002, people could stand up and argue and say, “This is the mortgage” but subsequent

to 2002, there was no way this could be argued as the mortgage. It is like saying the

egg is a chicken. The egg is not a chicken. All right?

THE JUDGE: Yes, all right. So the law has been changed and nobody realised it had been

changed.



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MR FERGUS: Yes. There is no case law. There are no cases that anybody can cite that

take into account the Land Registration Act 2002 and its effect when combined with

the Law of Property (Miscellaneous Provisions) Act 1989 and the statutory

requirements that—

THE JUDGE: You say section 27 of that Act is—

MR FERGUS: Of the Land Registration Act.

THE JUDGE: Section 27. So you say there is no registered mortgage?

MR FERGUS: That is indeed what we say and we go a little bit further than that. I want to

[inaudible] a little further than that. We would also like to point out that Eagle Star

and Target Holdings—

THE JUDGE: Now, actually, the case, where do I find that in your documents? Do you

have a copy of it?

MR FERGUS: Yes.

THE JUDGE: It is one of the things in this bundle?

MR FERGUS: I think you should have Target Holdings in there.

THE JUDGE: Yes.

MR FERGUS: You should have Eagle Star. Helden is not in there because Helden

actually rests upon Target Holdings, so if Target Holdings is wrong, then so is Helden.

THE JUDGE: I know of Helden. I have not got it in front of me. I can pull it off the

internet. Eagle Star and—

MR FERGUS: I will probably have a copy.

MISS MAYOH: I have a copy, if I can hand it forward.

THE JUDGE: Well, I have Eagle Star v Green & Challis. Is that the case you are referring

me to?

MR FERGUS: It was filed under section 15, I believe. Mummery LJ says... Well, you

can read it for yourself but if you want me to read it, I will read it:

“In my judgment this argument does not stand any real prospect of success.

This is not a case of a contract: it is a case of a deed. If we were simply

dealing with a contract to create a mortgage then Mr Green would be right.

But in this case he and Miss Challis have actually executed a deed. It is clear

from the provisions of the 1989 Act itself that a distinction is drawn between

the formal requirements affecting the execution of deeds and the formal

requirements governing contracts. Section 1 makes alterations to the law

about the execution of deeds. For example, they are no longer required to be



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written on any particular kind of substance and a seal is not required for the

valid execution of an instrument as a deed by an individual. There are a

number of detailed provisions in section 1 relating to deeds. Section 2 does

not apply to deeds; it applies to contracts. It may be a contract for the sale of

land, it may be a contract for some other kind of disposition of an interest in

land, one other kind of disposition being a transfer by way of security over

what is commonly called a mortgage or charge.”

All right? So he is basically saying, “By signing this piece of paper, you have

executed—”

THE JUDGE: A deed.

MR FERGUS: “—a mortgage, a charge or whatever you want to call it so, therefore,” he

says “the contract is of the mortgage. It is a contract that creates the mortgage”.

However, since the 2002 Act, that is not the case because the mortgage is only created

electronically at a later point in time, in Mrs Lamb’s case six months. All right? We

go further to say there cannot be any mortgage in equity either because that also

requires a two party contract to be signed, as I think the [Sayed?] case established; that

a mortgage in equity can only be created if there is a two party contract behind it.

THE JUDGE: Yes, all right. For the moment, I am prepared to accept your point: it does

not operate at law until the relevant registration requirements are met. You say that

they delayed the registration of that deed for six months?

MR FERGUS: No, we are not saying they delayed the registration. What we are saying is

that piece of paper is not a charge. It is not a mortgage, so it cannot be registered. All

right? We are saying that this piece of paper authorises the creation of the mortgage,

which makes it a contract for a mortgage. The mortgage is electronic. Since the 2002

Act, the mortgage cannot be a piece of paper. If the mortgage was the piece of paper,

the mortgage would be in effect straight away. The mortgage is not in effect straight

away. It is only in effect after the relevant requirements are met and one of the

requirements is that it is registered electronically.

THE JUDGE: So what do you understand registering it electronically to mean?

MR FERGUS: Basically, it means that the Land Registry used to have a paper based

system. They now have an electronic based system. The mortgage deed has no value.

They actually shred them—

THE JUDGE: Yes.

MR FERGUS: —after the mortgage is created electronically. The only purpose of the

mortgage deed or we say paper contract for mortgage... sorry, the paper contract by

deed for the electronic mortgage by registration is to authorise the Land Registry to

create the electronic mortgage.

THE JUDGE: There are still some properties not covered by the land registration system,

are there not, Miss Mayoh? Are there any areas of the country left not covered by land

registration or are they all now?



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MR FERGUS: The Act has been in force for ten years, so I would think there are very few,

if any, areas.

THE JUDGE: Well, I do not know. [inaudible].

MISS MAYOH: I think it is filtering through because there is a requirement to make first

registration.

THE JUDGE: That is when you have a transaction but there are transactions of unregistered

land.

MISS MAYOH: Yes, so there will still be properties which are unregistered.

THE JUDGE: I think what Mr Ferguson is saying is as long as the mortgage is relating to

unregistered land, for example, which was created before the coming into effect of the

2002 Act, then all is well. There is no problem. It is post 2002 that the supposed

change occurred.

MISS MAYOH: Yes, I think I follow.

THE JUDGE: Yes.

MR FERGUS: I am not being patronising or anything like that, but as far as I am aware,

the issues of the Land Registration Act 2002 interplayed with the 1989 Act have not

been before the court and there is no case law establishing whether what we are saying

is correct or what the claimant is claiming is correct and it is the fact that nobody has

addressed this for ten years. It is like for centuries people thought that the earth was

flat and if you went to the end of the world you would fall off the earth, so these things

do happen. People do miss things and people do take things for granted, but we have

looked into this matter and we believe at the very least we have an arguable case and

that our argument has merit. We would like to go to a full hearing to determine this

matter and we would like to get a barrister in court to further our argument and

elaborate and to advocate—

THE JUDGE: Well, that would undoubtedly be helpful, but your application is not to get

legal representation. Your application is to appeal, so you could have sought legal

representation now, I suppose.

MR FERGUS: No, but it is a matter... as you know, a lot of people think in a certain way.

They have been thinking in that way for a long time. It is not always easy for someone

to come to grips with something like this and, therefore, it is not always easy to find

somebody who can come into court and advocate on it and there are is also the

financial restraints that Mrs Lamb is under to take into account, but the thing is we

have not had a hearing. Well, we have had hearings. We have not had a trial. The

matter has not gone to trial and, as I said, we think we have got more than an arguable

case and we think we are entitled to go to trial.

THE JUDGE: All right. Well, let us just have a look then at the defence that you were

seeking to have accepted. I have that at page 34 of the 63 page bundle. Let me have a



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look. Now, just let me have that document back, the supposed deed, please. It is said

to be undated, is it not?

MR FERGUS: The deed?

THE JUDGE: The single page which I was shown a moment ago. Have you got it back

now, Miss Mayoh?

MISS MAYOH: Yes, I have.

THE JUDGE: Now, at the bottom of the page, it says:

“The official copy is incomplete without the preceding notes page.”

So have you got the preceding notes page?

MISS MAYOH: I think that is all that was exhibited to Miss Courtney’s[?] statement. This

is simply the charge conditions and the letter [inaudible]. No, that is all I have.

THE JUDGE: All right. Now, the document says, looking at it, and I know that Mrs Lamb

says that the date was added subsequently... That is what the defence says, that she

signed it in undated form and the date has been added later and the district judge dealt

with that by saying that was irrelevant. Paragraph 1:

“The mortgage deed incorporates the mortgage conditions.

(2) The borrower [that is the two signatories] charge the property by way of

legal mortgage with payment or money payable by the borrower to the

lender.

(3) The mortgage secures further advances.

(4) The borrower hereby applies for an entry on the register with the

following restrictions [inaudible] position... “

Now, as I understand it, Mr Fergus, what you say is, if we get to the nub of it, if what

is said in Eagle Star is right, Mummery LJ and if what is said in Helden v Strathmore

Ltd is right, Lord Justice Neuberger or the Master of the Rolls at the time, I think, then

the claimant’s case is correct, but they neither of them have taken into account section

2 of the 2002 Act because, of course, the 2002 Act came into force after the Eagle Star

case and you make the point that in Helden v Strathmore there is no consideration of it.

MR FERGUS: Yes, because he relies on the Target Holdings case, which is 1999.

THE JUDGE: So then we have to look at what the district judge said and we are back to the

point this is an application for permission to appeal, so let us have a look at what the

district judge actually said in his decision about that.

MR FERGUS: Are we looking at the district judge at this court?

THE JUDGE: Yes, how he dealt with the defence because we have been looking at the

defence and the defence has raised this point, in effect, has it not, because the defence



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sets out the basis of the proposition this was an undated document and it is not

accepted that it has been?

MR FERGUS: But the district judge relies at paragraph 9 on the Helden v Strathmore Ltd

case to say that section 2 does not apply.

THE JUDGE: Yes, because it is binding on him. You say, I think, if I put it in legal

terminology, he ought to have taken the view that you were raising a new point not

covered by Helden, so it was a case that was going to be a new case.

MR FERGUS: A new case. There is also something else which I think is relevant and that

is the fact that... I am kind of at a disadvantage here because we have not had a trial

and an opportunity to ask for disclosure of documents. I do not have a copy of the

official copy of the Register, which has been sent, but Mrs Lamb does not have it at

the moment - the first official copy of the Register, once registration had been

completed by electronic registration, which would have demonstrated that there are a

couple of pieces of information that not a lot of people are aware of and there are two

very important dates in terms of the registration and the registration process and the

creation of the mortgage that the Land Registry are responsible for. Those dates are

the capture date, so the capture date is normally the date that the Land Registry

receives the application or receives the paperwork from the mortgage company or the

solicitor who forwards it on to the Land Registry for registration, so the capture date is

normally stated there and that is the date when the actual potential charge is put on to

the Land Registry database; all right? There is another date, which is the mark-off

date. Now, the word “mark-off” is actually an American word and it actually means

registration. That is the mark-off date. Now the mark-off date is the point in time

when the mortgage comes into existence. Before that, there is no mortgage. It is only

when registration has been completed on the electronic database at the Land Registry

that a mortgage comes into existence.

THE JUDGE: Well, it is only when it is there that it is enforceable but, again, we come

back to the circular argument: what are you saying they have registered? You are

saying you do not know what they have registered?

MR FERGUS: They have created a mortgage, but we are saying that mortgage is void

because it does not comply with the mandatory statutory requirements as laid down by

Parliament.

THE JUDGE: Which are?

MR FERGUS: The Law of Property (Miscellaneous Provisions)... Well, the 1989 act,

section 2(3).

THE JUDGE: Yes.

MR FERGUS: It says a contract for the disposition needs to be signed by both parties.

THE JUDGE: All right. So you are saying that because it is not signed by anybody—



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MR FERGUS: We are saying since the 2002 Act, the deed has to be nothing other than a

contract for a mortgage which is created at some point in the future and because that

contract is not signed by the mortgagee, it is void. That is what the statute says: if it is

not signed by both parties, it is void, which means anything that comes off that is also

void and the claim for possession is void. The consequential mortgage which is

created electronically is also void. The power of attorney is also void.

THE JUDGE: So there must be a contract signed by both sides? That is a contract for a

mortgage?

MR FERGUS: Yes.

THE JUDGE: The mortgage comes into existence at law when it is registered?

MR FERGUS: Yes.

THE JUDGE: All right. That is the contract has to be registered electronically; yes? The

former practice whereby a person can execute a deed, which is what happened here,

where just the borrowers execute a deed, is no longer of itself capable of being

regarded as the mortgage?

MR FERGUS: Yes.

THE JUDGE: Your answer to my question, I think we got to the reason that registration six

months later does not cure that is that the document they have registered is not signed

by both parties; yes?

MR FERGUS: Well, I would not really ever say it is a document they have registered. I

would not say the document has been registered. What I would say is that the paper

contract by deed is a contract which authorises something else, which is the creation of

an electronic mortgage.

THE JUDGE: No, but who creates the mortgage?

MR FERGUS: Who creates it?

THE JUDGE: It is the parties, is it not?

MR FERGUS: No, the Land Registry creates—

THE JUDGE: No, no, no, the Land Registry is not party to the mortgage. This is a

contract.

MR FERGUS: When you said, “Who creates it” what do you mean?

THE JUDGE: Well, who—

MR FERGUS: It does not exist until it is registered and the paper contract authorises the

Land Registry to create it. As I said, since the 2002 Act, the mortgage deed has no

value to either the bank or the Land Registry. It is a useless document.



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THE JUDGE: Well, I understand the argument that unless and until something is registered,

we cannot enforce it because there is no evidence of its existence and lots of people

can come along and say, “Well, there was a mortgage and here is this document” but a

mortgage is a pledge - dead pledge, which is what it means - and the pledge is made by

the person, not by the Registry. There are parties to a mortgage. One is the title holder

of the property who charges his or her property, and the other is the person who

borrows the money, pledging not to seek to enforce the return of the capital if the

interest is paid. Those are the parties to the mortgage, so they create the mortgage.

MR FERGUS: Yes, but the mortgage is operating at law through the authority of

parliamentary statute. It is not operating—

THE JUDGE: That is true and you have already told me—

MR FERGUS: It is not operating—

THE JUDGE: —there are equitable mortgages—

MR FERGUS: Yes.

THE JUDGE: —a mortgage at law, so you have all the benefit of the legal remedies that

follow from your registered mortgage. Now, I am not concerned here with

unregistered mortgages because that is not what the claimants say they have got. This

is a device to avoid debt, is it not?

MR FERGUS: It is not a device to avoid debt. We are not making any claims about the

merits of any claim for restitution that Mortgage Business may have. What we are

saying is that The Mortgage Business according to the law, if the law is applied, have

no right to possession. That is what we are saying. Restitution and the claim for

money, that is something else. What we are talking about is the right to possess

somebody’s home and we are saying they do not have that. They could have signed

the deed. They have chosen not to. I do not know for what reason, but they have

chosen not to. I am sure they must be aware of the implication of the 2002 Act. It

may be they have taken a risk to think that nobody would ever notice.

THE JUDGE: So the bull point on your appeal though, the application, is you say DJ

McQueen misunderstood, as perhaps I did initially, the thrust of the argument, which is

that to say that he is bound by those cases in the Court of Appeal ignores your

argument that in fact the Court of Appeal cases do not deal with the argument that you

are trying to raise?

MR FERGUS: With this particular situation, yes.

THE JUDGE: And whilst you may lose at the end of the day, you are entitled, you say, to

have the argument tried so that you can then go to the Court of Appeal and, no doubt,

the Supreme Court in order to have it ruled that those cases do not govern the

situation?

MR FERGUS: Yes.



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THE JUDGE: He deals with your argument actually very briefly, does he not, if you look at

the transcript?

MR FERGUS: Yes, he does.

THE JUDGE: He says he is bound by the Hackney case to look at it as to whether you have

a reasonable prospect of success and he says he accepts that you were prompt, but he

then says, “Here is the argument about”, paragraph 9:

“There then appears to be an argument with regard to section 2 of the Law

of Property (Miscellaneous Provisions) Act 1989. I have before me the case

of Helden v Strathmore Ltd [2011] EWCA Civ 542, which makes it clear to

me that section does not apply to this particular mortgage. It was not a

charge for the future. Even if it were signed technically three or four days

before completion took place, that was to enable matters to be perfected on

the day. Authority was effectively given to the solicitors to do that... no

compelling reason why that argument should succeed at trial.”

You say that he is wrong there; it was a charge for the future. It was an authority to

create a mortgage, not a mortgage itself. Then when he goes on to the registration, he

says:

“... so far as I am concerned is a valid legal charge, registered and accepted

at the Land Registry.”

So no merit in that defence, he says.

All right, let me hear Miss Mayoh. Miss Mayoh, I hope we have got to the heart of it.

Do you understand? This is how I understand it to be put. The 2002 Act applies to

change the way in which mortgages are created and are enforced and because of

section 27 of the Act, this document described as a deed does not operate as the deed.

It operates as something less than that. It is not signed by the lender and, insofar as

Helden v Strathmore Ltd says that that is all right, that is a decision which is per

incuriam because the 2002 Act has not been referred to. I have not reminded myself

of the full decision in Helden, just to check that there was no reference to the 2002 Act

in the case, but the essence of it is that at paragraph 27 Lord Neuberger, who was the

Master of the Rolls after all, the most senior civil judge in the system, said that the

argument that was being put by Mr Helden, who was relying on section 53 but he was

not apparently lying on section 27 of the 2002 Act, was hopeless because of a

fundamental misunderstanding of the reach and purpose of that section, a

misunderstanding which appears not to be uncommon. Section 2 is concerned with

contracts for the creation of legal estates and land, not with documents which actually

create or transfer such estates. So he says that the document that we are looking at

creates an estate; therefore, section 2 does not apply, whereas Mr Fergus is arguing for

Mrs Lamb that in fact this document is a contract for creation, not the document itself.

Section 2 does apply; section 2 has not been complied with; and that is the end, he

says, of that.



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Is it an argument which is going round? Have your clients come across it before or is

it novel in the way that Mr Fergus says it is?

MISS MAYOH: I think my instructing solicitor set out in her evidence that they have been

in receipt of documents very similar or identical to the documents which have been

submitted in this case on other matters. They are internet-generated documents, as I

understand it, so I suspect that there is a group of people raising the very same

argument using the very same documents in other matters in different courts. That is

my understanding of this.

THE JUDGE: Well, I think Mrs Lamb has in the documents that were filed the other day

included in particular an order made in a case in Lambeth by HHJ Blunsdon, which, if

I read it correctly, is a case in which there has been a suspension of enforcement of an

order pending some application for permission to appeal and, indeed, Mr Fergus, is

that you, “The application of Simon Fergus”?

MR FERGUS: It is.

THE JUDGE: That is you, right. So are you yourself involved in another case where you

are the borrower?

MR FERGUS: Yes.

THE JUDGE: I see. Yes. So they have shown me that case. What about Joseph Fergus?

Who is Joseph Fergus?

MR FERGUS: That is me.

THE JUDGE: This is Simon Fergus.

MR FERGUS: Simon Fergus.

THE JUDGE: There is Joseph Fergus.

MR FERGUS: Simon Fergus is my brother.

THE JUDGE: Your brother. Sorry, I got the wrong Mr Fergus, forgive me. Has the

application for permission been heard yet?

MR FERGUS: Well, HHJ Blunsdon agreed that these arguments had never come before

him. He has never heard the argument before and he said in court that he needed to go

and research into the points that I had raised and it is going to take time to research, so

basically he deferred his judgment.

THE JUDGE: Yes. Well, I do not blame him. So on 3rd

January he said, “All right, all the

orders can be suspended but—”

MR FERGUS: He also indicated that if he did grant me permission to appeal, that he

would probably send it straight up to the Court of Appeal.



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THE JUDGE: Yes. Again, I have some sympathy with that. Yes, thank you for that. All

right, so maybe it is a number of different cases, the same people, and there is the

argument.

MISS MAYOH: I think it may assist your honour to know that perhaps the reason why the

district judge in this case dealt with this in the way that he did is because the

arguments were not put in this way before him and it is only by sitting here listening

that I actually understand the point that is being made myself and, certainly, I was not

assisted in that regard by the documents that had been filed. I think I understand now

how the argument goes. I do not accept that it is right.

THE JUDGE: No, but the question is whether there is a real prospect of success: not that it

is right, but that there is a real prospect of showing that the learned district judge,

perhaps because it was not put to him as eloquently by Mr Easeman as it has been by

Mr Fergus, who of course has some interest in the case for his own personal reasons...

He may have a deeper understanding than Mr Easeman. The question is whether

under the provisions of 52.3 it is a matter which should be made the subject of appeal

on the basis there is a real prospect of success, although whether it should succeed or

not I think is perhaps a matter that does require rather more research than we have the

time to deal with today. That is really it. Do you still resist the application for

permission to appeal?

MISS MAYOH: I think it would be foolish for me to submit that I am in a position to deal

with this, having only just fully understood the argument myself as I stand before you

today. I also think that there would be an advantage if the appeal were to proceed in

having it dealt with fully and properly at a hearing once the parties have had an

opportunity to fully research.

THE JUDGE: And possibly in Mrs Lamb’s case to obtain the sort of legal representation

that she hopes to obtain.

MISS MAYOH: I think there is little to be gained by rushing these arguments in the

circumstances.

THE JUDGE: Forgive me for flicking through while you are talking. Do you have a copy

of my order, the one that directs that there be an oral hearing of the application?

MISS MAYOH: Yes. Is it the order of 13th

October?

THE JUDGE: Well, there is an order of 10th

September, is there not, whereby I suspended

the warrant pending this?

MISS MAYOH: Yes.

THE JUDGE: 30th

October is the application for permission to appeal and, insofar as

necessary, the other application to be heard by me and I said at that time with the

hearing of the appeal, subject to permission, to follow, but that, of course, is not a

practicable... That is the order. I have it now, thank you.

MISS MAYOH: Yes, I have.



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THE JUDGE: All right. Well, I do not mean to put you in a difficult position, Miss Mayoh.

I am not inviting you to consent to permission. I am not inviting you to say nothing,

but it seems to me that it is difficult to deal with these issues given that Mrs Lamb and

her representative are, however articulate, not legally represented. They are quite

understandably citing portions of authorities. They are citing internet analysis of those

authorities, which is not the way in which it would be done if they were legally

represented, so to an extent you, now knowing what their cases are, have the burden,

as one always does against self-representing parties, of trying to provide the court with

the other side of the case.

MISS MAYOH: Yes.

THE JUDGE: I have the obligation, unfortunately without any secretarial assistance, of

trying to look the relevant cases up and looking at them without the editorial.

MISS MAYOH: Yes.

THE JUDGE: Now, you might say, “I am taken by surprise by the way in which it is put. It

is not the way it is put below, I [inaudible]” or you might say, “I will not consent; I

will not concede; but I recognise the court might say this is one of those cases where

permission should be granted so that when the ultimate decision is made, whichever

way it goes, the loser can then, if so advised, go to the Court of Appeal” and that loser

might be you. You could go to the Court of Appeal rather than let this go to trial—

MISS MAYOH: Yes.

THE JUDGE: —especially if there are cases in other courts where certain judges may on

application be making decisions which may or may not be the same as mine, whatever

mine is. One is going to get to a stage, I am sure, where parties if they succeed before

circuit judges... HHJ Blunsdon may well get to it before I do and, whichever way it

goes, somebody will be producing a judgment from HHJ Blunsdon as the basis for the

next decision. If you want five or ten minutes just to take instructions, I will give it to

you.

MISS MAYOH: Yes, I think I ought to.

THE JUDGE: Yes. I will rise for a few minutes. It is getting very late anyway and I do not

want to adjourn over to tomorrow if we can deal with it today without pressure

[inaudible].

MISS MAYOH: Yes, thank you.

THE JUDGE: I will give you five or ten minutes or as long as you need to make a phone

call and then we will see if we can resolve things.

MISS MAYOH: Thank you.

[A short adjournment follows]



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MISS MAYOH: Your honour, I am grateful for that. My instructions are to request an

adjournment of this hearing to an occasion on which a further hearing can be listed.

There is no problem with the actual appeal hearing taking place immediately after

permission on that occasion for the reason that I did not understand what the

arguments were until the hearing today. I am just not in a position properly to deal

with them on behalf of the respondent.

If your honour is not with me on that, then I would ask for the actual hearing of the

appeal not to take place as early as tomorrow but at a future occasion when an

opportunity has been made available for revised skeleton arguments and the like.

THE JUDGE: Mr Fergus, she is asking for an adjournment because she has only really just

worked out what your case is. Alternatively, if I do not give her the adjournment but I

give you permission to appeal, obviously, we cannot do the appeal now. What do you

say to the suggestion that the whole thing should be adjourned?

MR FERGUS: We object to an adjournment.

THE JUDGE: Why?

MR FERGUS: We have been filing our contention that there was no possessionary rights

as a result of the Land Registration Act 2002 for some time and we have not had any

sort of response from them whatsoever and I think if we came into court and said we

did not understand something that the claimant had submitted in evidence, we could

not achieve an adjournment based on that when papers had been filed and they had the

opportunity to raise any questions about anything that they did not understand. I mean

the Land Registration Act 2002, section 27, that is pretty specific.

THE JUDGE: Yes. It is not at all clear, when this was before the judge and Mr Easeman

was arguing it, that he made the point quite so clearly as you have but, anyway, you

object to the adjournment. You want me to deal with the permission.

MR FERGUS: Yes. We would like a full directions hearing and we would like to,

obviously, submit further evidence and, obviously, we seek a response from the

claimant.

THE JUDGE: No, there will be no further evidence. If I refuse the adjournment, I will

decide the permission application and it will be dealt with on the basis of what we have

because this is a legal point only from what you have told me. Yes, thank you very

much.

MR FERGUS: Sir, can I just clarify something? You say there will be no further

evidence. Does that mean that the claimant will not be able to submit any further

evidence or witness statements?

THE JUDGE: No further evidence. There can be further law.




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THE JUDGE: There can be further law if there are cases relevant, but you have both had

enough chance to put the evidence before the court and the reality is that if anyone

wants permission to adduce further evidence on appeal, they have to make a

application for permission to do it. If your argument is as good as you think it is, then

I would have thought you have already raised all you can raise. You have made the

very frank concession that the authorities—

MR FERGUS: Yes, but we are already aware that we would like to introduce expert

witnesses.

THE JUDGE: No. No, not on an appeal against a decision of the district judge. If you get

permission to appeal and you get the appeal allowed, then, of course, you will have to

go for directions for all sorts. Expert evidence from whom?

MR FERGUS: [Inaudible].

THE JUDGE: But, again, you know, Mr Fergus, this has been a serious point. It is a

serious point. We need to get it resolved.

MR FERGUS: I am not indicating [inaudible] whatsoever. We would like—

THE JUDGE: We have to get it resolved as quickly as possible.

MR FERGUS: We would like—

THE JUDGE: So either—

MR FERGUS: We would like to call the Land Registry and we will need someone from

the Land Registry—

THE JUDGE: No. That should have been done before. You can do that if you get

permission to appeal.

MR FERGUS: That is what I am talking about. I am talking about if permission to appeal

is granted, then we would like a directions hearing. I am not talking about a directions

hearing for a permission to appeal. I am talking about if you do grant us permission.

THE JUDGE: If permission is granted, you will get a hearing of the appeal. That is what

you will get: a hearing of the appeal, and the appeal will be heard on the basis of the

legal arguments that you raise. If you succeed on the appeal, you will be able to call

whatever evidence you are permitted to call, by which time you may yourself have to

respond to the decision in your own case. Plainly, these are cases that are going

ultimately to end up in the Court of Appeal, if not the Supreme Court, because there is

no way, if I find in your favour and then the judge below finds in your favour, on this

earth that the mortgage companies of this country are going to take it lying down, so

let us be clear about that.

MR FERGUS: We are aware of that.

THE JUDGE: We are—



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MR FERGUS: Yes, we are fully aware of that.

THE JUDGE: —going further, are we not?

MR FERGUS: Yes.

THE JUDGE: Let us deal with it on the point that has to be dealt with. Anyway, you

oppose their application to adjourn. Thank you very much. Yes, well, I am going to

refuse the application to adjourn. I will give the reasons shortly. Do you wish to say

any more in relation to the permission application? Of course, there are cases in which

some would say on permission the respondent is entitled to keep its powder dry

anyway.

MISS MAYOH: Yes. Sir, I think I will do that.

THE JUDGE: All right. Thank you very much. Give me a moment just to put the papers

together.

[Judgment follows]


MMOORRTTGGAAGGEEEE == ZZEERROO PPOOSSSSEESSSSOORRYY RRIIGGHHTTSS BBEECCAAUUSSEE TTHHEE CCOONNTTRRAACCTT FFOORR TTHHEE ‘‘MMOORRTTGGAAGGEE’’ IISS AA NNUULLLLIITTYY ……

IS IT A CONTRACT-BY-DEED FOR THE MORTGAGE - OR - A CONTRACT-BY-DEED OF MORTGAGE ?

IT IS A CONTRACT-BY-DEED FOR THE MORTGAGE – A PAPER CONTRACT FOR THE FUTURE ELECTRONIC MORTGAGE …

REASONED BY THIS MORTGAGOR ‘REGISTRATION-GAP’ ARGUMENT, WITH AN ARGUABLE & REAL PROSPECT OF SUCCESS,

REASONING THAT THE ‘MORTGAGE’ IS A VOID NULLITY, RESULTING IN ZERO POSSESSORY RIGHTS FOR THE MORTGAGEE

COMPANY, AND REQUIRING PRIVATE SETTLEMENT OR A HUMAN RIGHTS ARTICLE 6 FAIR HEARING OF THIS ... . (*) THERE IS NO MORTGAGE [except by * ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’ when Land Registry creates/grants the illusion] … . A). The purported ‘mortgage’ [also called the 'DISPOSITION'] is a nullity. A ‘mortgage’ only exists after electronic

registration. It is an ongoing act of HARASSMENT to pretend that the paper mortgage deed is the DISPOSITION. Many

mortgagee company 'home-possession' claims, in England or Wales, either unwittingly or deliberately overlook the

Parliamentary supremacy of Land Registration Act 2002 (“LRA2002”) s.27(1) and the consequences of the LRA2002

inter-relation with the Law of Property (Miscellaneous Provisions) Act 1989 (“LPMPA1989”) s.2(1), s.2(3), s.2(5)c),

s.2(6 ) and s.2(8 ). Mortgagee companies are harassing & trespassing upon mortgagors by unlawfully claiming

possessory rights and willfully avoiding the consequences of s.27(1) + s.2(1)&(3) which render the ‘mortgage’ a nullity … . B). Also avoided by mortgagee companies is the respected authority of Chitty on Contracts 31st edition OCT.2012

[paragraph #4-013 sub-section #70], in relation to mortgages, which states: “... contract is contained in a deed ...”. The

mortgagee company & mortgagor enter into a paper ‘CONTRACT-by-deed’ FOR THE electronic ‘mortgage-by-registration’.

* Only after the execution/dating/delivery/completion of the paper ‘CONTRACT-by-deed’ can the Land Registry (“LR”)

eventually ccrreeaattee, aka ‘ggrraanntt’ a ‘legal’ ‘charge/mortgage’ at the electronic ‘MMAARRKKEEDD--OOFFFF’ moment aka ‘registration-

moment-in-time’ aka ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’ [a system recognised in Germany but ‘hidden’ in England & Wales]. .

C). LRA2002 s.27(1) statute states: “… If a disposition of a registered estate or registered charge is required to be

completed by registration, it does not operate at law until the relevant registration requirements are met …”. . D). LPMPA1989 s.2(1) statute states: “… A contract for the sale or other disposition of an interest in land can only be

made in writing …”. . E). LPMPA1989 s.2(5)c), s.2(6 ) and s.2(8 ), statutes [also avoided by mortgagee companies] govern: “… a contract

regulated under the Financial Services and Markets Act 2000 …” i.e. including a “… regulated mortgage contract …”

and, by s.2(8 ), prevents the LRA2002 s.4(1)(g) and/or s.51 being construed to uphold any act of ‘part-performance’.

*

. ppaaggee ##116600 -- TTHHEE NNEEWW LLAAWW OOFF LLAANNDD RREEGGIISSTTRRAATTIIOONN bbyy EELLIIZZAABBEETTHH CCOOOOKKEE -- PPrrooffeessssoorr ooff LLaaww

(*) (*) WHY ??? . 1). Given that registrations are electronic; and . 2). Given that a mortgage, with legal effect, can only be created/granted when a * ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’ is lawfully

completed [the electronic ‘MMAARRKKEEDD--OOFFFF’ moment-in-time in compliance with section 27(1) of the LRA2002]; and .

3). Given that the Law of Property Act 1925 (“LPA1925”) s.52(2)(g) allows the LR/Registrar to ccrreeaattee, aka ‘ggrraanntt’ a

‘legal’ ‘charge/mortgage’, by * ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’, without needing to be by the LPMPA1989 s.1 ‘deed’; and . 4). Given that there is a purported section 1 LPMPA1989 ‘paper-CONTRACT-by-deed’ [affirmed as a ‘specialty’

CONTRACT, having a 12-year limitation period, pursuant to the Limitation Act 1980 (“LA1980”) at section 8]; and . 5). Given that the paper-CONTRACT-by-deed leads to a delay, before the dependent consequent/future electronic-

DISPOSITION-by-registration, it is a matter of fact that there is an actual ‘REGISTRATION-GAP’ of time; and .


http://www.legislation.gov.uk/ukpga/1998/42/schedule/1

http://www.wildy.com/isbn/9780414048010

http://www.legislation.gov.uk/ukpga/2002/9/section/27








http://www.legislation.gov.uk/ukpga/Geo5/15-16/20/section/52



6). Given that the executed paper-CONTRACT-by-deed [containing any power of attorney (“POA”) e.g. pursuant to

which any receivers are appointed)] is the contract FOR THE consequent electronic * ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’; and .

7). Given that the electronic DISPOSITION-by-registration is not the paper-CONTRACT-by-deed; and .

8). Given that FOR THE valid completion of an electronic [LRA2002 s.27(1)] DISPOSITION-by-registration, of an

interest in land, there must be a valid [LPMPA1989 s.2(1)] paper-CONTRACT-by-deed FOR THE consequent

DISPOSITION-by-registration [at the electronic ‘MMAARRKKEEDD--OOFFFF’ moment] to which the LRA2002 s.27(1) refers; and .

9). Given that the paper-CONTRACT-by-deed “… must …” comply with LPMPA1989; s.2(1) by containing all terms; and

s.2(3) by being executed by BOTH parties; it therefore follows that lack of compliance with s.2(3) results in a nullity; and .

10). Given that the above-mentioned reasoning is likely correct upon the 'balance of probability', say at a ratio, e.g. of

some 51 to 49%, it follows that it is very likely that any purported: a). ‘mortgage’; and b). the LPA1925 s.101 ‘power

of sale’; and c). POA; and d). any s.101 appointment of receivers pursuant to any POA - are all 4, in fact, null & void. .

(*) (*) (*) CONCLUSION … .

i). The 'DISPOSITION' referred to within the LRA2002 s.27(1) & s.91(4)(b), and the LPMPA1989 s.2(1), is also known

as the 'MORTGAGE'. It thereby follows, because of the LRA2002 s.27(1) ‘REGISTRATION-GAP’, that a ‘contract OF

mortgage’ never exists because a mortgage only exists after the electronic completion of registration i.e. ‘ddiissppoossiittiivvee--

rreeggiissttrraattiioonn’. For a valid mortgage, to exist, it is necessary for there to be a LPMPA1989 s.2(1) & s.2(3) compliant

‘contract FOR THE mortgage’. For requisite s.2(3) compliance the paper-CONTRACT-by-deed [containing the

mortgagee company POA] “… must …” be executed by both parties otherwise any contractual right, POA, mortgage,

possession claim, appointment of receivers or power of sale … are all null & void ab initio. .

ii). The mortgagee company has zero possessory rights over the mortgagor interest in land. The mortgagee may have

an ‘unsecured loan’ argument and any such claim shall require a monetary claim for restitution which could be heard

in chancery court jurisdiction. Mortgage possession actions, outside Greater London, are jurisdiction bound

exclusively in the local county court at least pursuant to the Civil Jurisdiction and Judgments Act 1982 (“CJJA1982”)

sch.4 r.11a)(i); and the County Courts Act 1984 (“CCA1984”) s.5(3), s.21(2) & s.21(3); and the CPR r.55(3)(1). .

iii). As substantially every purported 'legal-mortgage' [the * ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’], in England & Wales, is apparently

a mistake, a void ab initio nullity, it follows that all consequent land registry & county court mistakes [which, in fact (from

the outset), render all associated purported transactions without any legal effect whatsoever] may, for the sake of clarity,

now be corrected retrospectively i.e. since inception and ex debitio justiciae [an absolute entitlement merely upon asking]. .

(*) (*) (*) (*) REFERENCES … .

KEAY [2012] EWCA Civ 900 including paragraph #8, and HELDEN [2011] EWCA Civ 452 including paragraph #27 to #28, both

from the Court of Appeal [rather than the Supreme Court], in so far as each lacks reasoning for a paper CONTRACT-by-deed

FOR THE electronic mortgage, being ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’, the reasoning is embarrassing & per incuriam. Except in so far

as “… mortgage in the future …”; and the contract being executed ‘undated’ without that expressly written contractual term; are

both applicable - each decision otherwise has zero binding effect upon any courts in regard to the ‘REGISTRATION-GAP’

reasoning. That is to say at least in so far as each reasoning judicially disregards the Parliamentary supremacy of the LRA2002

s.27(1) statute, in juxtaposition to the LPMPA1989 s.2, when reviewing the chronological time-line, of the legal status, of the

‘DISPOSITION’ [aka ‘mortgage’] and the intrinsic ‘REGISTRATION-GAP’ that therefore renders the ‘mortgage’ a nullity.

Furthermore - in relation to the purported ‘mortgage’ having zero equitable or legal effect before or after registration:-

COUSINS’ THE LAW OF MORTGAGES [2010] affirms at page #610: “… Where a purported contract for the grant of a

mortgage on or after September 26, 1989 fails to comply with the requirements of section 2 of the Law of Property (Miscellaneous

Provisions) Act 1989, no mortgage will be created and, notwithstanding any oral agreement or deposit of title deeds, the creditor

will have no interest in or rights over the debtor’s land ...”; and FISHER AND LIGHTWOOD’S LAW OF MORTGAGE [2010]

affirms, at page #71 paragraph #6.6, the null & void status of equitable charges on land absent lawful ‘ddiissppoossiittiivvee--rreeggiissttrraattiioonn’:-

“… An instrument which creates an equitable charge and contains an agreement to create a legal charge, but fails to comply with

the formalities for a legal mortgage on land {see SAHIB [1996]}, will still create a valid equitable charge {the agreement would,

however, have to comply with the provisions of the Law of Property (Miscellaneous Provisions) Act 1989 s.2} … An agreement to

create a charge which fails to comply with the requirements of the law will not take effect as an equitable charge as being the

immediate disposition of an equitable interest in land in accordance with the Law of Property Act 1925 s.53(1)(c ) ...”.

LAW SOCIETY GAZETTE [1989] '… First, all contracts for the sale or other disposition of an interest in land will have to be

in writing ... Secondly, the signatures of all parties must be present; s.40 lacked this element of mutuality. Thirdly, non-

compliance with the rule will make the contract VOID rather than unenforceable, as under s.40. Fourthly, non-compliance

with the rule cannot be salvaged by part-performance; there is no contract to part-perform and s.40(2), covering part-

performance, is also repealed …'.

MACFOY [1961] Privy Council c/o Lord Denning states: ‘… If an act is void, then it is in law a nullity. It is not only bad, but

incurably bad. There is no need for an order of court to set it aside. It is automatically null and void without more ado, though it

is sometimes convenient to have the court declare it to be so. And every proceeding, which is founded, on it is so bad and

incurably bad. You cannot put something on nothing and expect it to stay there. It will collapse …’. © SUN.10.MAR.2013 @ 2034






http://www.legislation.gov.uk/ukpga/1982/27/schedule/4




http://www.justice.gov.uk/courts/procedure-rules/civil/rules/part55#IDAADKCC

http://www.bailii.org/ew/cases/EWCA/Civ/2012/900.html


http://en.wikipedia.org/wiki/Per_incuriam

http://www.wildy.com/isbn/9780421914100/the-law-of-mortgages-3rd-edition

http://www.wildy.com/isbn/9781405748070/fisher-and-lightwood-s-law-of-mortgage-13th-ed-hardback-lexisnexis-butterworths



http://www.lawgazette.co.uk/news/property-points

http://www.legislation.gov.uk/ukpga/Geo5/15-16/20/section/40/enacted

http://www.legislation.gov.uk/ukpga/Geo5/15-16/20/section/40/enacted

http://www.cfuzim.org/index.php/legal-cases/89-machakwi-estate

Documents

1PB48636 (c ) THU.09.MAY.2013 @ 1423a @ at BLACKPOOL County Court HHJ BUTLER Judgment PDF @ TUE.15.JAN.2013 @ TMB & LAMB @ [Void Mortgage & Orders] @ Page1to40