The Court of Appeal ruled that Tanager Designated Activity Company could be registered as owner of a mortgage charge transferred to it by Bank of Scotland plc, even though the bank had not first been registered as charge owner. The court also held that the validity of Tanager’s registration could not be challenged in the summary possession proceedings against Rolf Kane.
The judgment, delivered by Ms Justice Baker on 31 October 2018, answered five questions referred by Mr Justice Noonan. The case arose from Tanager’s claim for possession of Mr Kane’s principal private residence at 1 Elmwood, Clonsilla, County Dublin. The Circuit Court had dismissed the possession claim, and Noonan J was hearing an appeal when he stated the questions for the Court of Appeal.
The charge was originally registered in favour of Bank of Scotland (Ireland) Ltd in 2006. Under a cross-border merger effective on 31 December 2010, its assets and liabilities, including the charge, passed to Bank of Scotland plc. The latter sold a portfolio of securities including the charge to Tanager in April 2014. Tanager was registered as owner of the charge on 25 April 2014. It claimed Mr Kane had fallen into arrears; the Court of Appeal did not determine the possession claim itself.
Mr Kane argued that Bank of Scotland plc had to register as owner before it could transfer the charge to Tanager, and that the Property Registration Authority had made a mistake by registering Tanager. The authority appeared as amicus curiae, and Bank of Scotland as a notice party. The court interpreted section 90 of the Registration of Title Act 1964 as allowing a person entitled to be registered through a statutory defeasance to deal with the charge before registration. It held that the cross-border merger brought Bank of Scotland plc within that provision, so the authority could register Tanager without first registering the bank.
The court answered “no” to whether Mr Kane could challenge Tanager’s registration in the possession case or join the authority to that case for further argument. It said the summary proceedings could not look behind the register; a challenge to registration would require separate proceedings. The court also said a possession case could, in a suitable case, be stayed or adjourned, or enforcement postponed, pending rectification proceedings if those proceedings were reasonably likely to provide a defence.
The court answered that the question about considering the circumstances of Tanager’s registration did not arise, rejected the proposed section 31 “mistake” argument in the possession proceedings, and answered “yes” to whether section 90 applied to the transfer from Bank of Scotland plc to Tanager. It did not order possession or resolve the underlying possession appeal.