Cur. adv. vult.
JUDGMENT
April 25, MOCATTA J. read the following judgment.
This is an action brought by the plaintiffs against a well-known city firm of solicitors as defendants for alleged professional negligence by the latter when acting as solicitors for the plaintiffs in and about the purchase by the plaintiffs from Robert Wynn & Sons Ltd. of certain land at Newport, Monmouthshire.
The plaintiffs pleaded and it was common ground between the parties that it was the duty of the defendants and a term of the contract between the parties that the defendants in acting for the plaintiffs should use all due skill, care and diligence and make such necessary and proper inquiries about and in connection with the land as ought to be made.
The alleged negligence and breach of contract consisted in the failure by the defendants to use such skill, care and diligence or to make such inquiries in that they failed to raise or make any search, requisition or inquiry in or into the register of common land relating to the land maintained by the Newport Borough Council. It is admitted that the defendants made no such search, requisition or inquiry at the relevant time.
I have to decide two questions in this case. The first is whether such failure did constitute professional negligence on the part of the defendants and, secondly, if the first question be answered in the affirmative what the proper measure of damages is. The latter point is not altogether easy. This is not to say that the first point is simple; on the contrary, in addition to Mr. Franklyn, a partner in the defendant firm who was chiefly concerned with the transaction, there were called on behalf of the defendants two distinguished and plainly very able solicitors, Mr. Bartram and Mr. Purton, partners in two different firms, whereas on the other hand in support of the plaintiffs' claim there were called two other solicitors, Mr. Lodge of a Birmingham firm and Mr. Wilkinson of a City of London firm, both of whom were impressive witnesses.
It is necessary now to state how this matter arose. I will do so as briefly as possible. The plaintiff company was associated with, though not a subsidiary of, a German company with a comparable surname engaged in the manufacture of shop fitting equipment. Two directors of the plaintiff English company were Dr. Berry and a Mr. Smith, F.C.A. Dr. Berry seems to have been the most active director of the plaintiffs. In the summer of 1972 when the property boom in this country was still at its height the plaintiffs were looking around for premises where they could erect an industrial building to make shop fitting equipment. For this purpose they required a site of an acre in extent. The plaintiffs found 4 1/2 acres of vacant land at Newport, Monmouthshire, which were available for sale, and they requested the defendants, whom they knew, to act on their behalf in connection with their proposed purchase of this area of land. In general terms it is convenient to refer to the land in question very briefly as the Albany Street site, since a road of that name led to its south-western corner.
The plaintiffs seem to have instructed the defendants initially some time about mid-August 1972 when they had accepted an offer, subject to contract, to purchase the freehold of the land in question for £30,000. They had, shortly before instructing the defendants in the person initially of Dr. Kaufmann (the senior partner, Mr. Franklyn then being away on holiday), requested planning permission from the local authority for the erection of two industrial buildings upon the land. The earliest document before me in connection with the matter is a letter of August 23, 1972, from the solicitors for Messrs. Wynn, the proposed vendors, to the defendants for the attention of Dr. Kaufmann. A draft contract was sent to the defendants by Messrs. Wynn's solicitors on September 11 and a letter written by Dr. Kaufmann on September 28 indicates that he had received instructions from the plaintiffs to proceed with the matter as speedily as possible. On September 25, 1972, the Newport Borough Council granted planning permission for the erection of two industrial buildings on the Albany Street site.
The defendants made some preliminary inquiries of the vendors' solicitors by a letter dated October 4, 1972, which bears the references both of Dr. Kaufmann and Mr. Franklyn and thereafter all the letters written by the defendants on behalf of the plaintiffs until the plaintiffs terminated the defendants' retainer on September 25, 1973, were dealt with by Mr. Franklyn.
On October 17, 1972, the defendants sent to the solicitors for the vendors the Law Society's Form of Enquiries before Contract, No. 5 of which with the title "Adverse Rights" reads:
"Is the vendor aware of any rights or informal arrangements affecting the property other than any disclosed in the contract which are not immediately apparent on inspection and which are exerciseable by virtue of an easement, grant, wayleave, licence, consent or otherwise or which are in the nature of public or common rights?"
The answer to this was "Not to the vendor's knowledge."
The defendants also made the usual inquiries on the appropriate form of the Newport Borough Council and requested of that council a search and official certificate of search in relation to the register of local land charges. These disclosed the planning consent given on September 25, 1972, earlier mentioned, as well as a discontinuance order dated June 20, 1972, confirmed by the Secretary of State on September 29, 1972, in relation to the use of a part of the Albany Street site for the parking and maintenance of motor vehicles. Planning permission to use that part of the land for these purposes had originally been granted on April 7, 1972. The permission required the laying down of a hard impervious surface with an earth bank 30 feet wide and 3 feet high along the eastern boundary. This approached the eastern boundary of the whole site which ran along the bank of the river Usk which at that place was tidal. No part of the land in respect of which the defendants were negotiating with the vendors' solicitors on behalf of the plaintiffs included any part of the foreshore of the river Usk. It appears that the material used for constructing the hard impervious surface mentioned in the planning permission was in fact spoil resulting from the construction of the M4 motorway, the elevated bank of which constituted the northern boundary of the land in question. I should explain that Messrs. Wynn possessed at all material times, and probably still possess, a large motor or lorry repair workshop on freehold land owned by them immediately to the south of the 4 1/2 acres which they were negotiating to sell to the defendants. For their purposes it had no doubt been useful to use part of the 4 1/2 acres as a lorry park and for the deposit of various pieces of land moving machinery, etc. The discontinuance order mentioned was to come into effect on September 20, 1972.
It is now necessary to say something more about what I have hitherto described for the sake of brevity as the Albany Street site. The contract submitted by the vendors' solicitors to the defendants showed that the whole site consisted of at least seven different parcels of land and the complexity of the matter is well illustrated by the coloured chart appended to the contract. Despite the description of the seven parcels, a small triangular slip of land within areas depicted in various different colours on the plan and described in the contract was not covered by any of the seven parcels nor by any document ever submitted on behalf of the vendors to the defendants. In his evidence Mr. Franklyn described the 4 1/2 acres from a conveyancing point of view and the conveyancing problems arising as either a conveyancer's dream or a conveyancer's nightmare, depending upon the attitude and enthusiasm with which the particular person entrusted with the conveyance approached the discharge of his functions. The coloured plan attached to the contract disclosed that there had originally crossed part of the land a branch of what was called the Crindau Pill, a small tributary running into the river Usk. Originally before the Pill joined the river Usk it bifurcated, one branch going straight into the Usk and running more or less due east, the other branch running initially slightly to the west of north and then describing a semi-circle and running eventually due east into the Usk at a point considerably further from the mouth of the Usk than the place where the other branch of the Pill joined the river. The result of this semicircular bifurcation was to leave a more or less triangular piece of land bounded on the east by the river Usk and its foreshore and on the west at high tide by the tidal waters of the river Usk and at low tide by marshy land through which the Pill travelled its semi-circular course being little more than a stream without the addition of water provided by the tide. This area of land, that is to say, the northern bifurcation of the Pill plus the land on each side of the actual course of the stream covered by water at high tide was marked blue upon the plan. It was no doubt once upon a time part of the foreshore of the river Usk or of the Crindau Pill, a tributary of the river Usk, depending on how one prefers to describe it.
By the time the vendors were in negotiation with the plaintiffs for the sale of the 42 acres, the bulk of which was constituted by the land marked blue, that land had been reclaimed by the deposit upon it of spoil from the M4 and the levelling of a distinct area of it, though by no means the whole of it, for use as a lorry park as previously described. No building, however, had been built on any part of the 4 1/2 acres except for five small cottages at the bottom left hand corner described as nos. 1 to 5, Glassworks Cottages.
On November 9, 1972, the defendants wrote a lengthy letter to their clients containing a number of serious warnings which they should make up their minds about before signing the contract tendered by the vendors. Perhaps the most important point raised was that the vendors did not appear to be able to deduce a 15 years title. Indeed, for part of the land, namely, the triangular slip mentioned, they were not able to deduce any title at all and for other parts of the land they could only deduce title going back to 1961, 1962, 1963 and 1965. The sale was to take place on the basis that all mines and minerals were excepted. The defendants pointed out that this might well mean that mining activities under the land might result in subsidence for which there would be no redress. Notwithstanding these various warnings the plaintiffs were determined to enter into the contract. Indeed it was clear to them, and they made it clear to Mr. Franklyn, that they thought they were on to a very good thing. Indeed, subject to very important matters which have given rise to this action, it is clear that they were, since they were about to enter into a contract to purchase this particular site for £30,000, whereas such was the state of the property market at that time that whilst the contract for sale of the land was signed on November 13, 1972, and the purchase was completed on May 18, 1973, the plaintiffs had prior to the latter date been in communication with the Greyhound Racing Association and a subsidiary company of that organisation known as L. G. Bevan Investments Ltd., and had on May 11, 1973, agreed, subject to contract, to sell the whole 4 1/2 acres to the latter company for no less a sum than £100,000. They had in fact put the property in the hands of agents in November 1972, since their link with their German associate had ended by then.
On the very date of the conveyance by Messrs. Wynn to the plaintiffs, the defendants received a letter from Messrs. Jacobs, Bird & Co., one of whose partners was a Mr. Lodge, who dealt with this case and who gave evidence before me, confirming that they were acting for the proposed purchaser from the plaintiffs and were awaiting the receipt of a draft contract from the defendants at their early convenience. By this time the plaintiffs had applied for and obtained an enlarged planning permission entitling them to erect in all six industrial buildings on the 4 1/2 acres. It is of some interest to note that such was the buoyant state of the property market that not only were L. G. Bevan Investments Ltd. prepared to offer £100,000 for this property, but another company was in competition to purchase the property at the same price. They, however, fell out of the competition, largely, it appears, owing to the speed with which Mr. Lodge acted on behalf of L. G. Bevan Investments Ltd. It is worth mentioning that the plaintiffs did not provide the full £30,000 payable for their purchase from Messrs. Wynn out of their own resources, but raised £27,000 by way of mortgage. The mortgagees acted through yet another firm of solicitors called Berwin Leighton, London.
Inquiries were naturally made by this firm of solicitors on behalf of the would be mortgagees of the defendants in relation to the land in question, but it is to be noted that no inquiries were made in relation to whether any part of the 4 1/2 acres was subject to rights of common or were common land or for any search of the register in relation to this land maintained by the Newport Borough Council under the Commons Registration Act 1965. I should add that before completing the conveyance from Messrs. Wynn the defendants on behalf of the plaintiffs took out a defective title policy with the Sun Alliance Insurance Co. on behalf of their clients.
On July 13, 1973, Mr. Lodge of Jacobs, Bird & Co., Birmingham, solicitors acting on behalf of L. G. Bevan Investments Ltd., delivered to the defendants Inquiries before Contract, including question 5 as regards adverse rights in the terms cited earlier in this judgment in relation to similar action taken by the defendants vis-a-vis the solicitors for the original vendors Messrs. Wynn. The defendants later on July 24, 1973, provided exactly the same answer to Mr. Lodge as they had received to their question from the solicitors for the original vendors.
Apart from the inquiries made by Mr. Lodge of the defendants and a search of the local land registry, Mr. Lodge, in accordance with his usual practice when dealing with vacant land on which so far as he knew no building had ever been erected and with which he was not familiar personally, had requisitioned an official search of the register of common land maintained under the Act of 1965 by the Newport Borough Council in relation to the 4 1/2 acres. To his surprise he had been told by the town clerk, first of all by telephone and then in a letter dated August 16, 1973, that the reclaimed land through which the northern bifurcation of the Crindau Pill originally ran, which as I have explained earlier had been filled in, was registered with them, under the Commons Registration Act 1965, pursuant to an application made on July 8, 1969, by Residual Lands Ltd. There had originally been two objections to this registration, but these had been withdrawn on February 23, 1973, and pursuant to the scheme of the Act of 1965 the registration had thereupon become final. This information was of course passed on by Mr. Lodge to the defendants, who on August 29, 1973, requisitioned an official search themselves of the Newport Borough Council under the Act of 1965. This Act provided for the registration of commons in three separate parts, namely: (a) land which is common land; (b) rights of common over such land; (c) the names of persons claiming to be or found to be owners of such land or becoming the owners thereof by virtue of the Act.
The answer which the defendants received from the Newport Borough Council was that in the register in the ownership section the name of Residual Lands Ltd., of 8, New Square, Lincoln's Inn, was registered and the land in question was described as
"part of the foreshores of the rivers Ebbw and Usk in the County Borough of Newport the total area of which is marked with a green verge line inside the boundary as shown on the provisional register sheet No. 1."
This was or included the area shown in blue on the original plan appended to the contract of sale between Messrs. Wynn and the plaintiffs and thus included the reclaimed land in question. The land section of the register again described the land as "part of the foreshores of the rivers Ebbw and Usk in the County Borough of Newport as marked with a green verge line inside the boundary on sheet no. 1 of the provisional register map." However, the rights section of the register, a form containing three columns intended to be filled in, the heading to one of which reads "Particulars of the right of common and of the land over which it is exercisable," was completely blank. No specific rights of common had been claimed by Residual Lands Ltd. over the reclaimed land relevant to this action. I should add, as a matter of interest, that subsequent investigation disclosed that the registration by Residual Lands Ltd. of the reclaimed area of the 4 1/2 acres was made by a complete mistake. Residual Lands Ltd. had intended to register only and did succeed in registering rights under the Commons Registration Act 1965 over the foreshore of the western bank of the river Usk running from some considerable distance south of the 4 1/2 acres towards the mouth of the river to some distance north of them and also running along the foreshore of Crindau Pill from where that was tidal somewhere in the middle of Newport down to where the Pill joins the river Usk. It appears that the original plan submitted by Residual Estates Ltd., with their application for registration of these rights over the foreshore was considered by the registration authority to be too indistinct and they had requested a better plan. Unfortunately, the substitute plan prepared by some clerk on behalf of Residual Estates Ltd. included the reclaimed land constituting the greater part of the 4 1/2 acres with which this action is concerned. Accordingly the registration authority included that reclaimed land in the land over which Residual Estates Ltd. had claimed registration.
I should now before continuing further with the history of this matter make one or two further references to the provisions of the Commons Registration Act 1965, which resulted from recommendations in the Report of the Royal Commission on Common Land 1955-1958, which sat under the chairmanship of Sir Ivor Jennings. The Act of 1965 was intended greatly to simplify the complicated problem of ascertaining what land was subject to rights of common and possibly also to pave the way for subsequent legislation on the lines of section 193 of the Law of Property Act 1925 granting rights of access to the public over manorial waste within urban areas. So far as relevant the Act provided in section 1 (1):
"that there shall be registered, in accordance with provisions of this Act . . . (a) land in England or Wales which is common land . . .; (b) rights of common over such land; and (c) persons claiming to be or found to be owners of such land or becoming the owners thereof by virtue of this Act."
Registration was to take place by not later than January 2, 1970, and July 31, 1972, was the last date by which objections to registrations, which were down to that date provisional, could themselves be registered. In the event of an objection to a provisional registration being maintained the disputed claims had to be settled by a hearing before commons commissioners appointed by the Lord Chancellor. A chief commons commissioner and at least two other commons commissioners have been appointed, though the original commissioners were not appointed until considerably after the closing date for objections and there are still a very substantial number of cases for them to resolve in the course of future years. The Act of 1965 provides in section 18 for appeals from commons commissioners by way of case stated and at least four of these have so far reached the courts and have appeared in the law reports. Section 10 provided:
"The registration under this Act of any land as common land . . . or of any rights of common over any such land, shall be conclusive evidence of the matters registered, as at the date of registration, except where the registration was provisional only."
Section 13 provided for the very limited possibilities of amending the registers. Such amendment could take place where
"(a) any land registered . . . ceases to be common land; or (b) any land becomes common land . . .; or (c) any rights registered under this Act are apportioned, extinguished or released, or varied or transferred in such circumstances as may be prescribed."
The definition of common land is of great importance. It is to be found in section 22, and so far as relevant to this case, reads:
"`common land' means - (a) land subject to rights of common (as defined in this Act) whether rights are exercisable at all times or only during limited periods; (b) waste land of a manor not subject to rights of common."
The definition of "rights of common"
"includes cattlegates or beastgates (by whatever name known) and rights of sole or several vesture or herbage or of sole or several pasture, but does not include rights held for a term of years or from year to year."
Cattlegates and beastgates are descriptions of land over which rights of common may be exercised usually for a portion of a year and their owners are generally the lords of the manor or some other persons not themselves entitled to rights of common. It is a type of land or right over land most frequently found in the north of England. At common law rights of common fall into six categories: common of pasture, pannage, estover, turbary, common in the soil and piscary. For the purposes of this action the most pertinent definition is the statutory one which provides in section 22 (1) that "common land" includes "waste land of a manor not subject to rights of common."
The discovery by Mr. Lodge and its confirmation by the defendants on making the necessary requisition was of course a bombshell and raised considerable difficulties in the way of a satisfactory conveyance of the 4 1/2 acres by the plaintiffs to L. G. Bevan Investments Ltd. and their realisation of the very handsome profit in the region of £70,000 which should have resulted from their sale to L. G. Bevan Investments Ltd. after having purchased the land for a mere £30,000. In many ways, however, they were very lucky in as much as although L. G. Bevan Investments Ltd. and their solicitors were not prepared to go through with the contract in its original form from the plaintiffs, they were still very interested in acquiring the land and were prepared to negotiate suitable conditions in the contract which should adequately safeguard them. When one considers how near the date was to the collapse of the property market one can see how fortunate the plaintiffs and perhaps the defendants were at the attitude adopted by and adhered to on behalf of L. G. Bevan Investments Ltd. In addition it was most fortunate that Residual Estates Ltd. immediately recognised that the registration of the reclaimed land under the Commons Registration Act 1965 had taken place by mistake and were prepared to assist in every way possible to secure amendment of the register maintained by Newport Borough Council. This did not appear to be very easy at first glance, since the council maintained that the registration had become final and that the mere statement that it had been entered by mistake was insufficient, since that alone did not bring the matter within the provisions of section 13 of the Act of 1965 dealing with amendment of the register. However, to cut a long story short, a solution to the matter was eventually found as a result of the collaboration of Residual Estates Ltd. and three consultations with Mr. Ryan of counsel, co-editor of a valuable book called An outline of the Law relating to Common Land and Public Access to the Countryside, Harris & Ryan (1967).
Before coming to the method by which the dilemma was resolved I should explain that one of the documents or conveyances which Messrs. Wynn provided to the defendants when that firm were acting for the plaintiffs was a somewhat strange conveyance dated September 12, 1967. This was made between three gentlemen of the one part and M. Mole & Son Ltd. of the other part, the former being vendors and the latter purchasers. Messrs. Mole were the predecessors in title to Messrs. Wynn. The recitals to this conveyance stated that the vendors were the successors in title of Baron (and later Viscount) Tredegar before January 1, 1926, who then and until his death in 1934, continued to be lord of the manor of Wentlooge. The second recital stated that immediately before January 1, 1926, the land described in the first schedule was vested in the predecessors in title of the purchasers in fee simple subject to the rights of the lord of the manor in respect of mines and minerals in and under and sporting rights over the land or some parts thereof and certain other rights which were preserved by the Law of Property Act 1922 and remained vested in the lord of the manor. I was told that the latter rights concerned fairs and franchises. Recital 3 stated that all the rights of the lord of the manor preserved by the Act of 1922 were vested in the vendors in fee simple in possession free from encumbrances as trustees upon the trusts for sale declared by an assent made on January 16, 1957, by the first named vendor to the conveyance and four other persons and the vendors to the conveyance had as such trustees agreed with the purchasers for the sale of such rights to the purchasers for the sum of £225.
The deed witnessed that in consideration of that sum paid by the purchasers to the vendors as trustees, the latter, in execution of the said trusts for sale, conveyed and released to the purchasers all their rights in respect of the land marked on the annexed plan and coloured pink preserved by section 128 (2) of and paragraph 5 of Schedule 12 to the Law of Property Act 1922 to hold the same unto the purchasers in fee simple to the intent that the same might be merged and extinguished in the fee simple of the land. The land delineated on the plan annexed was what I have been previously calling the reclaimed land.
I have already stated that the plaintiffs withdrew their retainer to the defendants on September 24, 1973. It is to be noted that had the search of the commons register disclosed nothing, the conveyance of the 4 1/2 acres to L. G. Bevan Investments Ltd. could have been completed on September 28, 1973.
As it was, on November 28, 1973, a conditional contract of sale of 4 1/2 acres was entered into between the plaintiffs and L. G. Bevan Investments Ltd. This document provided for the payment to the vendors' solicitors, who were then Messrs. Baily Gibson & Co. of Beaconsfield, of a deposit of 10 per cent. of the purchase price and in clause 6 that the vendors would at their own expense and before completion obtain the removal and cancellation from the register of common land under the Act of 1965 of all entries relating to the property in question. Clause 7 was a clause of some complexity, the primary provision of which was that completion of the sale and purchase under the contract would take place within one month of the receipt by the purchasers' solicitors of written confirmation and notification from the registration authority, namely, the Newport Borough Council, that the property and the entries relating thereto under the Act of 1965 had been removed from the register of common land and cancelled. The remainder of the clause dealt with extended periods of time within which such confirmation and notification might be obtained and gave various options to the purchaser. It is unnecessary for me to go into the details of these two sub-clauses.
It was of course arguable that as the conveyance of 1967 indicated fairly clearly that the reclaimed land had been disposed of by the lord of the manor at some date before January 1, 1926, it could no longer be considered as manorial waste and therefore could not in any event have fallen within that particular definition of common land already cited reading "waste land of the manor not subject to rights of common." Furthermore, as no rights of common in the land had been registered, it could clearly be argued that after the latest date for registration of rights of common, which expired at the end of July 1970 there was no possible risk of any part of the 4 1/2 acres being subject to rights of common or otherwise being common land. However, the contrary was also arguable, and long after the problems with which the various firms of solicitors concerned in this matter had struggled had been resolved. Foster J. in In re Yateley Common, Hampshire [1977] 1 W.L.R. 840, 853 expressed the opinion obiter that although the manor there in question had ceased to exist as a geographical entity after 1925, nevertheless it had become an incorporeal hereditament often referred to as a reputed manor. He dealt with the argument that where the lordship of the manor was divorced from the ownership of the land, that which had previously been manorial waste could not be part of the manor, by saying that there was no reason why Parliament in the Act of 1965 intended that land should cease to be registrable under that Act if it were no longer owned by the lord of the manor. This case is subject to appeal. A somewhat similar view was adopted by Slade J. in In re Chewton Common [1977] 1 W.L.R. 1242, 1249. Other views on this particular and rather intricate problem have been expressed recently by Goff J. in Central Electricity Generating Board v. Clwyd County Council [1976] 1 W.L.R. 151, and Slade J. in In re Britford Common [1977] 1 W.L.R. 39. However, the solicitors dealing with these 4 1/2 acres did not have the foresight of prophets. They did, however, have before them the conveyance of September 12, 1967, and they knew the nature of the land and that it was vacant land with no buildings upon it save for five cottages already mentioned and that at one time it had, or part of it had, been used as a lorry park, the latter part being reclaimed from what had been the northern branch of the Crindau Pill and the foreshore on either side of that branch covered by tidal water at high tides.
The problem was eventually solved by a deed dated January 9, 1974, between Residual Lands Ltd., who were in respect of the manor of Wentlooge the successors in title of Baron (and later Viscount) Tredegar, who was lord of the manor of Wentlooge until his death on May 3, 1934, and the plaintiffs as grantees. The operative part of this deed stated that for the avoidance of doubt the grantors as trustees conveyed and released to the grantees all the estate interest and rights which they might have in the land delineated on the plan annexed thereto coloured pink. This deed covered the reclaimed land.
Armed with this document the plaintiffs' solicitors applied to the Newport Borough Council for the amendment to the register and this eventually took place after the council had given the necessary 40 days public notice of their intention. By letter dated March 28, 1974, the town clerk informed the plaintiffs' solicitors that the register had been amended. Mr. Lodge, however, required to make assurance doubly sure in connection with this matter and accordingly despatched a requisition for a search in order to verify that the register had been cleared of the previous entry in relation to this land and on April 17, 1974, Mr. Lodge informed the plaintiffs' solicitors that he had received a clearance from the local authority on April 17. Consequent upon this, effective completion of the conveyance from the plaintiffs to L. G. Bevan Investments Ltd. took place on May 31, 1974.
The writ in this action was issued on September 27, 1974. The statement of claim claimed damages for negligence amounting in the unamended form of the particulars in schedule A to a net total, after setting off the defendants outstanding charges, of £10,171.48. The damages claimed can be divided into two main categories. The first category included one item amounting to £3,883.93 in respect of interest payable on the plaintiffs' mortgage of the 4 1/2 acres with First National Finance Corporation from September 28, 1973, to May 31, 1974. Mr. Hordern before me amended the latter date to May 4, 1974, but the necessary correction to the sum of interest claimed was stood over. The second item in the first category was interest on £67,000, being the difference of £70,000 between the sale of £100,000 to L. G. Bevan Investments Ltd. and the purchase from Messrs. Wynn for £30,000 after deduction of various legal expenses etc., from September 28, 1973, to originally May 31, but, by amendment, May 4, 1974, at 12 per cent. I was told that the appropriate figure on this basis was £4,846.
The second category was made up of various legal expenses under five headings. It is unnecessary for me to state the details of these since, as I understand the position, it was agreed between counsel that subject to my deciding the issue of liability and certain disputed matters in relation to the correct measure of damages the assessment of the quantum of damage recoverable by the plaintiffs, if any, should be referred to a master or official referee. In principle, assuming that there was any liability upon the defendants, Mr. Cullen on their behalf did not object to the various items in respect of legal expenses, subject to their quantum being investigated and justified. On the other hand he strongly contested that there was any liability in relation to the two items in the first category.
The plaintiffs' case was simply put. The Commons Registration Act 1965 had been passed in order to simplify the investigation of any encumbrances upon title by reason of rights of common, a matter of very considerable complexity requiring in many cases investigation of mediaeval land law, quite apart from the difficulty of establishing the necessary facts. Regulations issued under the statute had provided for methods of searching the register by the use of a particular form which only costs 37p. This minimal sum might be very slightly increased though not in excess of a maximum additional fee of £2 in respect of each parcel of land above one where several parcels were included in the same requisition. When the defendants eventually asked for a search after Mr. Lodge had raised the matter they enclosed £1 with C.R. form 21 on which they made their requisition for an official search. The plaintiffs did not argue that in every case of a proposed contract for a sale and subsequent conveyance of a freehold a search of the commons register should be made. Plainly if one were dealing, for example, with the sale of a large office block near the Bank of England one could safely ignore the possibility of there being any rights of common involved. The question, however, which arose and was debated at great length was where the line should be drawn.
Mr. Lodge drew it, as I have already indicated, in this way. Unless he was personally acquainted with the land in question, if the land was vacant neither by reason of a fire nor bomb damage nor demolition prior to rebuilding, in other words if it was land which had never been built upon, then he would as an invariable rule, whether the land was in a town or in the country, make a search of the register. Mr. Wilkinson, the other expert called on behalf of the plaintiffs, favoured a slightly different principle, namely, that he would make a search if he felt that the public had access to the site in question. Mr. Wilkinson had had very considerable experience as a solicitor acting in local government work and subsequently from 1947 to 1959 he had been chief legal officer for Crawley new town. He had in latter years left to enter private practice and was at the time that he gave evidence senior partner in the firm of Woodham Smith, Greenwood & Holland who practise in W.C.1. He, like Mr. Lodge, and both of the expert witnesses called on behalf of the defendants, had read the warning in relation to the Commons Registration Act 1965 that had been published in two successive editions of the Law Society's Gazette (1971), vol. 68, pp. 132, 195, itself, I understand, an unusual occurrence. The passage in the Gazette started by saying that the Council of the Law Society wished to draw the attention of solicitors acting for intending purchasers of property to the fact that the property being purchased might be the subject of a claim under the Act of 1965. It then indicated how anyone claiming that a piece of land was common land could apply for it to be registered and drew attention to the remarkable fact that local authorities were not bound to inform owners of the land in question of an application affecting their land or of any provisional registration and did not in fact do so. The Gazette drew attention to the special form 21 provided under the Commons Registration (General) Regulations 1966 (S.I. 1966 No. 1471) for a requisition for an official search in the registers of common land. The Gazette further stated what is undoubtedly true, that property owners might nevertheless be unaware that their land was burdened by a provisional registration. Mr. Wilkinson, although he himself had never made a search of a commons register, since all the conveyancing work that he had done since he had entered private practice had been in relation to city property, was well aware that registrations had taken place and thought that the attempt to secure some kind of finality in relation to common rights by the scheme of the Act of 1965 was generally welcomed, because it was so difficult to ascertain what was and what was not common land or land over which certain people had rights of common of one kind or another.
The case for the defendants was that conveyancing is an art and that of necessity a considerable discretion must be left to any solicitor acting for a would be purchaser in relation to the searches and inquiries which he makes before approving a contract for signature by his client. There was put to Mr. Wilkinson, as to each of the other solicitor witnesses giving evidence, a passage from Emmet on Title, 16th ed. (1974), reading as follows. In a section headed "Special Inquiries," which is contained in a chapter dealing with matters before contract and contains a part dealing in particular with searches and inquiries of local authorities and further inquiries of vendors and others, it is said in paragraph (c), at p. 28:
"On purchase of rural land it may be advisable to inquire of the county council whether any enclosure award may affect the land. Investigation of the contents of such award is usually a lengthy task but unexpected burdens, such as rights of way or public rights over the land occasionally come to light. If any question may arise as to whether land is common land or a town or village green or as to rights of common over such land the provisions as to registration thereof contained in the Commons Registration Act 1965 should be considered. All such land and rights must be registered between January 2, 1967, and March 31, 1970, and provision is made for the vesting of unclaimed land, for instance, in the local authority. Final registration of such land and rights will be conclusive evidence of matters registered (see section 10)."
Reference is then made to a special form (form 21 obtainable free from the county council) for a requisition for an official search in the register of common land. Reference is further made to the statement of the Council of the Law Society in the Law Society's Gazette to which I have already referred.
Mr. Wilkinson agreed that there was no hard and fast rule laid down in relation to this matter. His principle was that if he thought there was some access to non-built up land by the public then it was wise to make a search of the commons register. He did not accept that commons rights could be destroyed by permission being given under the Town and Country Planning Acts, and acted upon, for the use of part of the land as a car park. He thought that access might be gained to the land from the river on its east and also from what appears from the chart to be an open footpath running behind the five Glassworks Cottages. He did not attach importance to the fact that neither the solicitors for the mortgagees nor those for the would be purchaser competing with L. G. Bevan Investments Ltd. searched the commons register. Towards the end of his cross-examination Mr. Cullen summarised various matters which he put to Mr. Wilkinson as in counsel's contention justifying the absence of a search of a commons register. They were that the solicitors in question knew that the original branch of the Pill travelling to the north round the island and the adjacent foreshore on each side of that branch had been filled in with rubble; that the western boundary of the 4 1/2 acres was protected from the public by a wire fence; that to the south of the 4 1/2 acres to be sold was land belonging to the vendors Messrs. Wynn; that at the north of the site was the M4; that the site or most of it had been used as a lorry park for four years; that a discontinuance order had been served in respect of this user; that planning permission had been granted for two industrial buildings and that from the conveyance of 1967 it appeared that the land had ceased to be part and parcel of the land of the lord of the manor and furthermore the answer to question five given by the vendors to the defendants' inquiries before contract. Mr. Wilkinson said in answer to this that despite all these various matters he thought that had he been dealing with the matter a "warning bell," as he put it, would have rung in his mind in relation to possible common rights, the primary reason for this being because in his view the public could gain access to the land and the land was not built over. He added that the fact that the land was not built over notwithstanding its juxtaposition to an industrial area would be an indication to him that there might well be third party rights interfering with development. He did not think that a great deal of reliance could be placed upon the answer given to question five of the Enquiries before Contract. His view was that if there was any "warning bell" at all he would not proceed to do a balancing act as to the probabilities whether there were or were not common rights. He would use the facilities offered by the Act of 1965, which would be far from costly to take advantage of and would insure the position of his client in relation to the tricky question of common rights should the client proceed to enter into the purchase contract. The Act of 1965 had been passed in order to provide a simple method of resolving doubts and avoiding pitfalls; it should have been made use of.
I have already indicated Mr. Lodge's principle and how he acted upon it in this case. In addition to the fact that the land was vacant land which had not been built on and with which he was not familiar, he would have had his inquisitiveness and doubts added to by the defects in the title offered by the vendors. Mr. Lodge also shared Mr. Wilkinson's doubts whether rights of common, if they had existed, could have been abolished simply by the deposit of spoil from the M4 under permission given under the Town and Country Planning Acts and the use of the larger part of the 4 1/2 acres as a lorry park. Mr. Wilkinson established to my satisfaction that mere grant of planning permission had no bearing upon the problem at all. Indeed, he instanced that planning permission was often given by a local authority notwithstanding that it was in conflict with the same local authority's building regulations. Mr. Lodge, who is plainly a very careful solicitor, had initiated his practice as regards the commons register as far back as 1969, before the publication of the notice in the Law Society's Gazette. Mr. Lodge did not accept that on the facts known in this case the defendants prior to their client entering into the contract as competent solicitors could have taken the view that the search of the commons register was not required. He agreed that despite his inflexible rule and the fact that the conveyancing branch of his firm of which he was the head would have dealt with more than 200 conveyances per annum, he had never found another entry on the commons register since his unfortunate discovery in the present case. He did not think that it would be right to weigh up the possibilities in favour and against the existence of common rights if there was a reasonable possibility of such rights existing.
Before coming to the evidence called for the defendants and the submissions made by Mr. Cullen on their behalf it is right that I should refer to two useful authorities cited by him. The first is Simmons v. Pennington & Son [1955] 1 W.L.R. 183, a decision o f the Court of Appeal. The facts of that ease were that premises owned by the plaintiff were subject to an obsolete covenant restricting their use to that of a private dwelling house, but had in fact been used continuously for many years, both before and after the plaintiff became owner, for business purposes, without any complaint being made. In 1948 the plaintiff sold the premises by auction to B who paid a deposit. The property was described in the particulars of sale as a "valuable and commanding freehold corner shop premises," and by special condition of sale no. 7 it was stated that the property was sold subject to the restrictive covenants as to user contained in a deed of 1870 (which restricted the user to that of a private dwelling house), so far as those covenants were subsisting and capable of taking effect. In answering a requisition as to title whether the premises were subject to a restrictive covenant, the defendants acting as solicitors for the plaintiff, replied "Yes, see special condition 7. There appear to have been breaches of the covenant as to user but no notice of breach has been served." The purchaser who wished to get out of the contract owing to a change in the value of property, accepted that reply as a repudiation of the contract and in an action recovered his deposit from the plaintiff. While that action was pending another purchaser offered to buy the premises, but on the advice of the defendants through their managing clerk not to sell pending the trial of the first action the plaintiff refused the offer. Subsequently the property was badly damaged by a fire and, as he had allowed the insurance to lapse, the plaintiff suffered. There can rarely have been a more unfortunate plaintiff, for having lost in the court of first instance and in the Court of Appeal in the action in which the initial purchaser recovered his deposit, he was equally unsuccessful in the court of first instance and in the Court of Appeal in the action from the report of which I am quoting in which he claimed damages from his solicitors for negligence. The reason given for this was that the defendants having in answering the requisition acted in accordance with the general practice of conveyancers, which had been followed for many years without any ill consequence, they could not be held to have acted negligently or failed to come up to a reasonable standard of care, for they could not reasonably have anticipated the result which had flowed from it.
The answer given to the requisition on title by the solicitors' managing clerk followed the form which the trial judge, Harman J. said had been used in answering such questions "from the time of the memory of man, or at all events for a long time." The solicitors had acted in accordance with the general practice of conveyancers; no ill consequences had ever been known to flow from an answer to a requisition in this form. Denning L.J. said that now the case had gone adversely to the vendor it was possible to see that a mistake had been made, but he warned against being wise after the event. At p. 187 the test he applied was whether the solicitors in the position in which they were at the time that they were called upon to answer the requisition on title had "failed to come up to a reasonable standard of care and skill such as is rightfully required of an ordinary prudent solicitor." Applying this test Denning L.J. held that it was impossible to say that these solicitors were guilty of a breach of duty to their client; it was one of those misadventures and misfortunes which do sometimes happen in the best conducted businesses. In coming to the same conclusion Hodson L.J. cited the language of Scrutton L.J. in Fletcher & Son v. Jubb, Booth & Helliwell [1920] 1 K.B. 275, 280, where he said:
". . . it would be extremely difficult to define the exact limit by which the skill and diligence which a solicitor undertakes to furnish in the conduct of a case is bounded, or to trace precisely the dividing line between that reasonable skill and diligence which appears to satisfy his undertaking, and that crassa negligentia, or lata culpa mentioned in some of the cases, for which he is undoubtedly responsible. It is a question of degree and there is a borderland within which it is difficult to say whether a breach of duty has or has not been committed."
The other authority cited was the admirable direction to the jury by McNair J. in Bolam v. Friern Hospital Management Committee [1957] 1 W.L.R. 582, 586-587. The judge in dealing with a situation involving the use of some special skill or competence, such as in medicine or surgery, said that the test whether there had been negligence or not was not that of the man on the top of a Clapham omnibus, whose view about whether a car had been driven negligently a or not might well be acceptable, but was the standard of the ordinary skilled man exercising and professing to have that special skill. Negligence meant failure to act in accordance with the standards of reasonably competent medical men at the time, but the judge went on to point out that there may be one or more perfectly proper standards and if the defendant conformed with one of those proper standards then he was not negligent. As the judge put it in summary, the defendant was not guilty of negligence if he had acted in accordance with the practice accepted as proper by a responsible body of medical men skilled in that particular art. So much for the authorities.
The first expert witness called for the defendants was Mr. Bertram, a solicitor in the firm of Thomson Snell & Passmore, who practise principally in Tunbridge Wells and Tonbridge and also have a small office in Cranbrook. He is the senior conveyancing partner in the Tonbridge branch and together with a partner in the Tunbridge Wells branch, who is also a conveyancing specialist, heads a committee within the firm responsible for its conveyancing practice which involves the dissemination of information in relation to conveyancing throughout the firm, such as the publication of a monthly conveyancing news sheet. There would be some 30 to 40 persons in the firm so engaged in conveyancing. The practice was a very general one in relation to conveyancing and included London leasehold property, industrial property and country estates. The majority of their work was naturally localised in the regions of their three offices, but they did have work which covered the whole country. He stated that the practice of a solicitor engaged in purchasing a property on behalf of a client before 1965, or certainly the practice in his firm, was, first, to raise a preliminary inquiry on a printed form on receipt of a draft contract as to public or common rights. His firm has their own form of inquiries before contract, which breaks down question five into different sub-paragraphs, but does not greatly differ from the content of that particular question. Apart from the answer to the question raised before contract Mr. Bertram said that he would, secondly, expect a vendor expressly to mention any rights of common or common land in the contract itself: he thought the vendor's solicitor might be in difficulty if he did not make such mention and such rights existed. Thirdly, in his opinion, a prudent solicitor would always ask the client for a description of the land or see a surveyor's report dealing with it. Between them the surveyor or the client might well bring factors to the attention of the solicitor which could point to commons rights; he would not raise a query in relation to commons rights if he was buying a flat, but he would if he was buying a house near Tunbridge Wells Common, since he had particular knowledge of commons rights over that well-known and very beautiful stretch of countryside enclosed for the most part by urban dwellings.
Since 1965, he would certainly have relied upon those three factors. He accepted that the Commons Registration Act 1965 introduced a further factor. His principle was that if in any way the purchaser's solicitor was not satisfied as the result of answers to inquiries and the provisions of the draft contract or from what he had been told in regard to land by his client or his client's surveyor, then out of caution he felt that the solicitor should make a search under the Act of 1965. He considered, however, that it must be a question for judgment in each case depending upon the factors he had enumerated. He did not think it could be right to say that a search should always be made in the case of vacant land because he gave an example of land in urban or dock areas where in one's wildest dreams one could not imagine commons rights existing. It must depend in his judgment on where the vacant land was. He emphasised that if inquiries had to be made everywhere, the whole system of conveyancing would break down and immense costs would be incurred. Furthermore, the relevant county councils would not have adequate staff to deal with such a volume of inquiries. He agreed with the opinion expressed by Mr. Wilkinson that the Act of 1965 was an attempt, generally welcomed in the profession, to facilitate the ascertainment of what would otherwise be a very difficult matter in many cases, namely, whether the land was common land or subject to rights of common. He would not necessarily be satisfied by an answer "Not to the vendor's knowledge" in reply to question five of the form used by the defendants in relation to inquiries before contract. He said that he had in every case to consider whether there was anything that prompted him to search the commons register and he thought that he would have given such consideration had he been acting on behalf of the plaintiffs. He said that his present practice, since the line had to be drawn somewhere, was to apply the same considerations in relation to the three factors which he considered prior to the Act of 1965. The difference was that if left in doubt prior to 1965 he would have warned the client of the matter and inquired whether the client was prepared to authorise expenditure of a considerable sum of money in an endeavour to make local inquiries from aged inhabitants and various manorial rolls, etc., to try and dispel such doubts, whereas post 1965, if such doubt existed after consideration, he would consult the register. He agreed that any competent solicitor would know that common land derived from the old feudal manorial system and he thought that mention in a conveyance of the lord of the manor should make a competent solicitor think in that direction. The conveyance of 1967 would of course give a great deal of difficulty; if he had studied it, he would probably have concluded that the land was not common land and the fact of no proper title would have made him exceptionally careful and one course open to him would have been a search of the commons register, which might have thrown some light upon the question of title. He agreed that if a system of conveyancing was properly operated it still could not ensure that a client was protected, though naturally he accepted that if one form 21 had been sent in to the Newport Borough Council, the present action would never have come to pass. He made no searches of the register in 1972, although he was dealing with a large amount of vacant land. Since he had been consulted in this case, he had, however, made a good number of searches. He had obtained positive answers; one was in a case where he expected one because of information in the contract document, another was one which was not expected relating to the extension of a village green which in fact turned out to be an advantage to his client and not a disadvantage. He was confident that he would not have made a search if he had been in Mr. Franklyn's position.
The second expert witness called on behalf of the defendants was Mr. Purton, a partner in the well-known City firm of Norton, Rose, Botterell & Roche. He is the senior partner in the property department of that firm and has been since 1961. He now has overall responsibility for seven other partners, 11 assistant solicitors and five legal executives, making a skilled staff of 24 in all in the conveyancing department. He was conversant with every aspect of conveyancing, though he was particularly concerned with conveyancing by dealers in property and was therefore particularly interested in the financial and fiscal aspects of such transactions and they had always acted in relation to a considerable number of transactions dealing with vacant and undeveloped land since they acted for so many property developers. In 1972 the practice of his firm had been and still was that whether a search should be made under the Act of 1965 was left to the judgment of the partner, solicitor or legal executive dealing with the matter. He listed a very large number of steps that he almost invariably took when acting on behalf of a client interested in purchasing property which it is unnecessary for me to particularise, but he took the view that a search in the commons land register should only be made if the collective information he had received from inquiries indicated or pointed to the possibility of common rights or common land existing. Each situation would require analysis and he attached much importance to the information he would be likely to receive from his client or his client's surveyor. He thought that the answer given in the present case to question 5 of the inquiries before contract could be relied upon and he would not as a general point of practice go beyond that answer, unless there were other indications giving rise to doubts. He would have expected the vendors to have known if there had been any genuine rights of common and in that event to have disclosed this matter through their solicitors. As regards what may be called try-ons (and the scheme of the Act of 1965 did permit the registration of rights by people who had no possible claim to them), he said that usually such suspicious action gave rise to local gossip, since persons likely to indulge in it were unlikely not to give some publicity to and boast about their action. If there had been rumours in any case of a try-on entry on the register, he would have made a search. As regards the conveyance of 1967, this would have discouraged him from thinking of any other adverse rights over the land, since on the face of the document the intention of the panties to it had been to clear the land of any adverse rights, and it indicated that they had succeeded in doing so. In the circumstances of the present case he did not think he would have made a search of the commons register. He agreed that one of the objects of the conveyancer acting for a wouldbe purchaser was to ensure that the purchaser did not find himself with an encumbrance on the land of which he had no knowledge or which he was not prepared to accept. If a client was buying land to develop, a genuine registration of commons rights would be a major encumbrance. He thought a try-on registration could be an encumbrance or an obstacle to development dissuading a purchaser from entering into a proposed contract, though it also could be little more than just an irritant. He thought that in blatant cases of unjustified registration of rights relief could in some way or other be sought from the courts, though he would not wish his client to have to indulge in litigation unnecessarily. As regards whether in considering a proposed purchase the solicitor acting for the would-be purchaser should give his mind to the problems of common rights and common land, he said it would depend upon circumstances inasmuch as in, for example, a case of land in the City of London he would not consider the matter. If, however, it was vacant land to be developed a great deal would depend on where the land was.
In the present case he would have considered the matter and he agreed that the fact that the land was vacant made it more likely that there were common rights which might have been registered than, for example, a proposed sale of built up land in Baker Street in London. In buying vacant land in the country he would search the register unless satisfied by other inquiries and the exercise of his judgment that there could not be a genuine entry whether valid or subject to argument as to its validity on the register. He agreed that the law of commons was very complex and uncertain and that since the Act of 1965 had been passed many persons had made entries that could not be substantiated. The answer to question 5, if the only piece of information he had, would not satisfy him in relation to the problem of common rights, though it would have been an important ingredient. In the present case on the documents before him, which were those the defendants had before contract, he would not have been exactly satisfied that there could not have been an entry on the register, even with negative information from his client. He had in fact no idea in view of the provisions of section 10 of the Commons Registration Act 1965 how it was possible to get rid of a mistake or a malicious registration. He agreed that whether land was enclosed or not was an important factor. He knew that these particular 4 1/2 acres were not fully enclosed and accepted that the fact that a piece of land had not been fully fenced and had not been built on, depending upon the situation of that land, might constitute a factor pointing to the desirability of searching the register. He agreed when his attention was drawn to the conveyance of 1967 that it was a rarity to buy land part of which had once upon a time been an island; this fact would have turned his mind in the direction of rights of all sorts including commons rights. The conveyance of 1967 would have told him that the land had once been manorial waste and he appreciated that rights normally existed over manorial waste. He was of the opinion that if any third party did have rights of common they would have survived, despite the existence of the conveyance of 1967. The conveyance of 1967 would have brought the problem of common land directly to his attention, but analysis of the conveyance would have encouraged him to dismiss from his mind the thoughts of common land. In his view a competent solicitor would only search in the register if in his judgment he was not satisfied that there were no commons rights over the land in question. He agreed that a thought that might have crossed his mind or been present in his mind was that if there were commons rights over the land, this would be disastrous to his clients.
He did not, however, agree that the only way to settle this matter was to make a search. The first exercise he would carry out was to try and arrive at a conclusion about commons rights from the information and documents before him. If having arrived at a conclusion it was unlikely that there would have been any entry of commons rights, then in his opinion a competent solicitor would not make a search. He did not consider that the short title which the defendants' clients were getting would have had any bearing upon the question whether the commons register should have been searched. Whilst the conveyance of 1967 would have drawn the problem of commons rights to his attention a close scrutiny of it would have led him to conclude that there were none. The difference made to his practice by the Act of 1965 was that if he had been left in doubt about the matter before 1965, he would have warned his clients of the matter and asked them whether they would sanction further inquiries on his part which might be expensive and possibly inconclusive. Today, if left in any doubt, he would spend 37p or slightly more on using form 21 in making a search under the Act of 1965. He thought that his own tests would have brought to his knowledge the possibility of a claim to rights of common if there were any genuine and well founded claims or bona fide claims which might be open to bona fide objections or to try-on or malicious claims. In any of these cases he would have checked the registry. His tests would have not covered the facts of the present case where there was a purely honest mistaken entry. He had personally not made a search of the register though he was unable to say whether or not his assistants had done so. He had up to date not found himself in any difficulty by reason of failing to make a search. He had, however, been concerned in several oases where there were contested registrations and some of these were still awaiting decisions by the commons commissioners.
Mr. Franklyn described how Dr. Berry had visited the site in question and described it to him as being a flat area next to the river Usk where machinery and building material had been dumped. Dr. Berry had also mentioned that he knew that part of the area consisted of land which had been reclaimed by means of the dumping of waste material from the M4 motorway. He looked at all those deeds which had been sent to him before the contract was signed. Amongst these he examined the conveyance of 1967, which had a number of unusual features which in combination indicated that the land comprised in the proposed conveyance must have ceased to have been vested in the lord of the manor before January 1, 1926.
Mr. Franklyn in chief said that he did not make a search of the commons register because it did not occur to him that this was a case where there was any likelihood of an entry and said that in practice if a warning bell rang you took action comparable to the search of the commons register if that was appropriate to the warning that had arisen in your mind; if, however, the bell had not rung no action of comparable kind would have been taken. In cross-examination he agreed that it was not his case that he had thought about the subject of commons rights over the land in question and rejected it as being so unlikely as to not warrant further consideration. His case was that the culmination of all the factors of which he had knowledge did not cause what he called the warning bell to ring. If anything had caused that bell to ring in his mind, he would have searched rather than have indulged in a careful balancing operation, weighing up one factor against another and attempting to arrive at a decision whether the possibility of commons rights could be safely ignored. He said that there were no factors in the present case that had turned his mind in the direction of rights of common or commons land. He knew the land had not been built on. He did not ask Dr. Berry about the amount of public access that there might have been to the land. He was unable to answer whether the idea of manorial waste had entered his mind. As the conveyance of 1967 gave the impression that the freehold had been in Mole, the predecessors in title of Messrs. Wynn, the idea of the land being other than ordinary freehold land did not occur to him. He agreed that no proper title was being offered to considerable portions of these 4 1/2 acres and by and large he agreed with Mr. Lodge that in such circumstances a preliminary investigation as a solicitor acting on behalf of a would-be purchaser should be all the more thorough because there might be some reason for this lack of good root of title. He had for this reason sounded a grave warning to his client Dr. Berry, who had brushed such warning aside on the grounds that Mr. Wynn was a qualified solicitor and what was good enough for him was good enough for Dr. Berry.
Whilst I hope I am conscious of and give sufficient heed to the danger of being wise after the event, I have come to the conclusion after a careful review and consideration of the evidence summarised above that the plaintiffs are entitled to succeed upon liability. My reasons are as follows.
First, it was agreed by all the witnesses that rights of common raise extremely difficult problems going far back into the medieval system of land tenure, cultivation and economics, in which few solicitors, and certainly none of the witnesses called, would claim to be expert. Secondly, the Commons Registration Act 1965 was passed with a view to settling doubts and making it possible for a very small fee to ascertain with ease and certainty whether the land which a client was intending buying was or was not subject to rights of common or was common land. Thirdly, admirable though the objects of this Act were it was strangely drafted since anyone could, down to a certain date, register rights which might be wholly groundless and might become final if not challenged in time without the owner having any knowledge of this, a fact that had been brought forcibly to the attention of the profession by the Law Society. The Act of 1965 was therefore to some extent a trap unless use was made of the register. Fourthly, the Act of 1965 included in the definition of common land the somewhat unexpected sub-heading of "waste land of a manor not subject to rights of common." Accordingly it was not sufficient to have reasonably good grounds for thinking no one was claiming rights of common over the land; despite this the land might still be common land. It seems that a further statute was intended to deal with this rather special category of common land: see New Windsor Corporation v. Mellor [1975] Ch. 380, per Lord Denning M.R. at p. 392. Fifthly, the fact that part of the land had until relatively recently belonged to the lord of the manor and had not been built upon should have sounded a note of warning as regards waste land of a manor, classically defined by Watson B. in Attorney-General v. Hanmer (1858) 27 L.J.Ch. 837, 840:
"The true meaning of `wastes,' or `waste lands,' or `waste grounds of the manor' is the open, uncultivated, and unoccupied lands parcel of the manor, or open lands parcel of the manor other than the demesne lands of the manor."
Sixthly, although it would not be right to attribute to solicitors in 1972 forebodings about the crop of recent cases about manorial waste, they should, once the possibility of this land having once been manorial waste had occurred to them, as in my view on the evidence it should, have without hesitation requisitioned a search of the commons register. Seventhly, the importance of a complete lack of any encumbrance on this land to the defendants' clients, who were planning to develop the land, made a search all the more desirable because of the likely serious financial consequences of an encumbrance.
In fact it will not have escaped attention that in the case of Mr. Franklyn no warning bell (his own expression) rang at all; in the case of the two experts called on his behalf it would have. Had it rung with Mr. Franklyn he would not have indulged in a nice balancing operation, as would Mr. Purton, but would have secured certainty for his client by a very small expenditure. I do not think that in an aspect of conveyancing that should have been importantly affected by the Act of 1965, it can be said that two equally well-established schools of practice had emerged by 1972 and that safety was then secured by taking the inaction adopted by one such school, even though without following the thought and reasoning of its exponents. Nor do I think it can be any answer that the entry made in this case and discovered by Mr. Lodge's careful search was a mistake.
This decision does not mean that a solicitor is in peril of an action for negligence unless he searches the register in every case in which he is retained on behalf of a purchaser of land. There is clearly room for some discretion in relation for example to densely built up land, but in so far as it is possible to lay down a general rule as useful guidance I think the one that Mr. Lodge laid down and has acted upon in his firm ever since 1969 is the best that has been or perhaps can be suggested.
I now turn to the questions in relation to the quantum of damage that it is required I should decide before referring to another tribunal the detailed assessment of damages.
The most important of these arises in connection with the first two items in schedule A. Mr. Cullen had no objection to items 3, 4, 5, 6 and 9 as items, subject to verification of their quantum, or to the setting off of the defendants' outstanding charges, which are admitted by the plaintiffs. Items 7 and 8 were abandoned.
As regards item 1, interest payable on the plaintiffs' mortgage and item 2, interest on the profit, however, Mr. Cullen argued that these could only be recovered if the case could be brought within the second rule in Hadley v. Baxendale (1854) 9 Exch. 341, which was not possible on the evidence, and that the only loss recoverable was the legal costs incurred by the plaintiffs in having the register rectified. I cannot accept this. The evidence of Mr. Smith, a director of the plaintiff company, who went to see Mr. Kaufmann of the defendants when the latter were originally instructed during Mr. Franklyn's absence on holiday, was that Mr. Kaufmann was told that the plaintiffs' intention was to build a factory for shop fittings that would occupy an acre and develop the rest of the area and sell or let off the rest. In the light of these instructions, and in the state of the property market as it was then, the defendants should in my judgment have reasonably contemplated that if they failed to secure an unencumbered title for the plaintiffs without warning them of the defect, the damages the plaintiffs would suffer were "not unlikely" to be the loss of a handsome profit on resale. I choose Lord Reid's phrase in C. Czarnikow Ltd. v. Koufos [1969] 1 A.C. 350, but the phrases favoured by the other Law Lords in that case are equally applicable.
As regards item 2 in schedule A it was agreed that the words "less tax" should be deleted. The only remaining questions concern whether the terminus ad quem for these first two items should be May 4, 1974, instead of the pleaded date of May 31, 1974, as the plaintiffs conceded, or whether the date should be earlier. Mr. Cullen argued for April 29, 1974, and I think this is the right date to take. I do not think responsibility for any later date can be brought home to the defendants. Effective completion in fact took place on May 31, 1974.
It was not suggested before me that the terminus a quo for items 1 and 2 claimed in the plaintiffs' schedule, namely, September 28, 1973, was incorrect.
Finally, it was agreed that L. G. Bevan Investments Ltd. had deposited £10,000 in respect of the purchase price on November 27, 1973, that the rate of interest earned on that sum was 12 per cent. and that the resultant sum for the period to April 29, 1974, should be divided equally between the parties.
Subject to anything that counsel might say I think the proper course is for me to order that unless agreement is reached between the parties the action be referred to a master for him to assess the quantum of damages in accordance with what I have said above and to enter judgment for the plaintiffs for the sum found due after making due allowance for the set-off and the defendants' moiety of the interest earned on the sum deposited.
ORDER
Judgment for plaintiffs with costs.
Damages to be assessed.
Crown Copyright acknowledged
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Date: 11 November 2002