There are many occasions when a deed used in a property transaction needs to be amended after it has been executed: there may be a typographical error in the document; there may be a blank space that needs to be filled in; the draftsperson may have omitted an agreed form wording or clause; the plan may be incorrectly coloured. The Land Registry published a practice guide in 2009 to deal with amendments parties may need to make to deeds required for registration (see Land Registry Practice Guide 68: Amending deeds that effect dispositions of registered land). However, more and more deeds in today’s transactions are being executed and completed electronically, with an electronic signature applied to the document in a e-signing platform. What is the position if an electronically signed deed needs to be amended?
In an update to Land Registry Practice Guide 8 (Execution of deeds), the Land Registry has provided interim guidance on how to go about amending a deed that has been signed with an electronic signature. One option is for the executed deed to be printed out and amendments made to the print-out (presumably in manuscript but possibly by the addition of printed text). An endorsement would be added at the start of the printed-out document to the effect that: “The electronic deed of which this is a print-out is amended this day [date] as follows.” The deed is, of course, the client’s deed, and so prima facie the client should be authenticating any amendment to the deed. The Land Registry states that, as far as material amendments are concerned, the amendments must be countersigned by the parties themselves. However, if the amendment is not material, Land Registry guidance is that the endorsed print-out will only need to be amended by a conveyancer. The conveyancer would add his or her signature, and would confirm that he/she has their client’s authority to do this.
This seems to accord with what we understand to be the position in relation to amendments made to documents, including deeds that remain executory (i.e. yet to be delivered or, in registered land cases, yet to be registered), although it must be said that most of the relevant case law relates to contracts rather than deeds. In Raiffeisen Zentralbank Osterreich AG v Crossseas Shipping Ltd [2001] 1 WLR 1135, the Court of Appeal held that a contract altered after it had been signed would not be invalidated by the alteration unless the alteration was material. An amendment is material if it is “potentially prejudicial to [a party’s] legal rights or obligations under the instrument”. In Koenigsblatt v Sweet [1923] 2 Ch 314, the Court of Appeal held that a contract in writing could be effectively altered after signature by a party provided that the person making the alteration had the authority of the party in question to do so (or, if not, if the act was subsequently ratified). It is assumed that deeds not yet having legal effect and contracts are treated alike. In Frazer v Brown [2009] EWHC 2692 (Ch), Lewison J was happy that a variation of a plan in a Land Registry transfer, achieved without the re-execution of the deed, was valid on the basis that a Land Registry transfer remains executory only until registration.
Whether an amendment is material or not is an issue for the conveyancer to decide. The Land Registry points out (quoting from the Raiffeisen Zentralbank case) that an amendment is not material if it has “rendered express, or had no effect upon, in the sense of adding nothing to, what the law would otherwise provide or imply” or it “merely corrects [an] error in description in accordance with the original intention. If the conveyancer is unsure, the Land Registry suggests proceeding on the basis that the amendment is material, and therefore the amendment should be countersigned by the parties. A further option, says the Land Registry, whether the amendment is material or immaterial, is to use a deed of rectification or variation.
The interim guidance applies pending the outcome of a more thorough review by the Land Registry.
It is worthwhile considering alongside this guidance the Land Registry’s position on amending deeds executed in the conventional way, as set out in LRPG 68. This Practice Guide gives advice on how to deal with amendments parties need to make to a deed, whether by alteration to the deed, subsequent deed of variation, or subsequent deed of rectification. It covers the making of amendments to deeds that have been executed by or completed between the parties but have not yet been lodged for registration, deeds that have been completed and lodged for registration, and those that have both been completed and fully registered.
Where a deed has not yet been submitted for registration, LRPG 68 states that the original deed can be altered so as to give effect to the parties’ true intentions. The Guide states that “All alterations to the deed must be authenticated by the signatures of all the parties against each amendment made. If a plan to the original deed is amended, then all the parties should re-sign the plan. If a new plan is substituted for an existing plan in the original deed, all the parties should sign the new plan.” Consistent with what is said in the new guidance, it has always been the case that material alterations to executed deeds should not be initialled by conveyancers. Some amendments may involve adding further land to the transfer. Where the correction of the deed not yet registered involves the addition of land (for example, because the original transfer did not transfer all of the land intended to be transferred) correcting the transfer to include the additional land may not be advisable since it would not necessarily afford the transferee priority for its registration in relation to the additional land. If the transferee’s priority search related only to the land originally transferred, the additional land will not be protected by that search.
Once a deed of transfer has been registered, if it is discovered that a parcel of land had been omitted from the original transfer, the correct method of dealing with the need for the correction is for the transferor to execute a further form TP1 (or TR1). A deed of rectification or deed of variation would, in these circumstances, be unacceptable. In addition, if the effect of the alteration is not only to transfer more land, but to alter easements, it may be necessary for the parties to include variation provisions in the new transfer and/or enter into a deed of variation of easements where the variations affect other adjacent owners. In all cases, care should be taken to comply with any restrictions affecting titles. If an original transfer was only capable of registration with the consent of a restrictioner, any additional correcting transfer of the same title will also require that consent.
This content was provided by Alan Riley, Property Law Consultant.
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