The August holidays are now over and slowly the courts are getting busier with interesting cases for the new season, including those involving property fraud. We are always interested in reporting new and interesting cases.
One property fraud case that caught my attention was a case called Farakh Rashid (F) v Mohamemd Rashid (M) which was a case that was decided in the Upper Tribunal on 30th August 2017.
M was the registered owner of a Property in Birmingham until May 1989 when F‘s father forged his signature on a transfer and registered himself as proprietor of the Property. In 1990 F’s father by way of transfer gifted the property to F and he has been the registered proprietor of the property ever since. Upon application by M (the original registered owner) in 2011, he was restored to the register as the registered owner of the land as he had been deprived by fraud.
F appealed that decision.
F argued that whilst he was the registered proprietor by a property fraud, he was thereby also in adverse possession of the land. Therefore, he should be registered as owner because of his adverse possession.
It was argued before the Upper Tribunal that whilst a squatter can obtain possession of land by wrongful behaviour, can a person whom the land registry have has registered as owner be treated as squatting in the same land he owns?
The Judge ruled in the Upper Tribunal that once the registered proprietor is registered, the Tribunal would have the power to alter that registration to correct any mistakes or rectify any errors and that accordingly until the application for alteration and rectification was considered the registered proprietor could not be in adverse possession of the property as he had already been registered as owner.
So,, the correct decision had been reached to alter the register in favour of M and register him as the registered proprietor. If M did nothing to regain possession of the land after rectification then F may still have rights by his position after rectification but that would depend on M making application for possession of the land as quickly as possible.
This property fraud case is quite fascinating in terms of the approach the Courts will take to rectification, and how the Courts will deal with cases of adverse possession by fraudulent behaviour and its impact upon registration. It seems the Courts will preserve the ultimate rights of the register to be rectified to prevent fraud as there are good public policy decisions why the powers of rectification should be preserved
It is clear that there are bound to be other cases in this area and challenges to the registrar’s powers of rectification with the increasing number and cases of possible property fraud.
We have handled several cases in the courts in connection with adverse possession and if you are unsure of your legal position then contact us for further advice in connection with any such matters via this link>>>