Jurisdiction(s):
United Kingdom

Corporate execution of land contracts: registration’s primacy and CA 2006 s43 as a third route alongside s44 (Mars Capital v Hussain, England and Wales)

Published on: 20 September 2021

Published by a LexisNexis Commercial expert

Legal News

Article summary

Mars Capital Finance Ltd v Hussain and others [2021] EWHC 2416 (Ch)

What are the practical implications of this case?

This ruling underlines that, after a transfer of land has been entered on the register, any prior defects in the enforceability of the underlying contract for that transfer cease to matter. Accordingly, earlier formal shortcomings cannot be used to unsettle a completed, registered disposition. That principle is clear and decisive here. In addition—though not essential to the outcome—the judge endorsed the position that sections 43 and 44 of the Companies Act 2006 permit three mechanisms for a company to enter a written contract (by the company or on its behalf). This contrasts with the interpretation that, for the purposes of the Law of Property (Miscellaneous Provisions) Act 1989, only two methods exist, and it departs from Lewison J’s approach in Redcard Ltd v Williams [2010] EWHC 1078 (Ch). Advisers will sensibly steer clients away from being the test case that settles the debate by using one of the two undisputed routes in section 44 of the 2006 Act; nonetheless, the stance taken serves to discourage parties seeking a technical, form-based exit from a bargain.

What was the background?

Mr Hussain...

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