Register of Community Interests in Land

General

It is a general application condition in terms of section 22(1)(c), that an application for registration must not fall to be rejected by virtue of a prohibition in an enactment. In terms of section 23(1)(b) for a disposition or notice of title inducing first registration, and section 26(1)(a) for registrable deeds submitted as dealings or transfers of part, the registrable deed must be valid.

Further, in terms of of section 21(2) and (3), to the extent that an applicant does not satisfy the Keeper that the general application conditions, and the conditions of registration applying to specific application types are met, the Keeper must reject the application for registration.

Section 40(1) of the Land Reform (Scotland) Act 2003 prohibits the proprietors of certain land (or other persons with right to sell that land) from transferring that land, where it is subject to either a pending or registered interest of a community body in the Register of Community Interests in Land ('RCIL'). A disposition in breach of this prohibition is of no effect, that is, void.

The 2003 Act provides for a rural community 'pre-emptive' right to buy when the proprietor of land (or another person with right to sell the land such as a heritable creditor) decides to dispose of that land.

Points to note about RCIL

The RCIL is kept by the Keeper.
It has two parts: one for the community right to buy and another part for the agricultural tenants' right to buy.
Within RoS, both parts of the RCIL are administered by the staff of the Chancery and Judicial Registers.
Decisions on community right to buy registration are made by Scottish Ministers; those about registration of the agricultural tenant's right to buy are made within RoS.
Any person enquiring about the community body right to buy process should be referred to the Scottish Government website for guidance.
A pending or registered community right to buy may affect the validity of a disposition being registered in the Land Register; this is not so for land affected by the right of an agricultural tenant.

Community Right to Buy Registration Process

The community body must firstly apply to the Scottish Ministers (not the Keeper) to pre-register its interest in the land.

When such an application is received, the Scottish Ministers will instruct the Keeper to make an opening entry on the Register; this is a pending application.

A consultation exercise then takes place, with the views of the landowner (and any heritable creditor) being taken into account.

If the Scottish Ministers approve an application, this decision is notified to the Keeper who then enters the community interest in the RCIL and the interest of the community body is then registered.

How will Registration Officer know Application may be Affected by RCIL?

Dealing or transfer of part - next application note on LRS title workdesk

When a pending application is made in the RCIL, affected registered titles will be identified by Map Base Maintenance and a Next Application Note ('NAN') entered on relevant title sheet or title sheets if the affected subjects (or any part of those subjects) are registered in the Land Register or are undergoing first registration. For form of NAN see below.

First registration or voluntary registration

If the subjects affected by the pending or registered interest of a community body in RCIL are not registered in the Land Register when Map Base Maintenance compare the information in the RCIL application, then the registration in RCIL should be identified from an index entry either at Manual PI stage or by the plans officer completing the plans settle process.

Form of NANs

The NAN will take one of the following forms:

Application CB xxxxx entered on the Register of Community Interests in Land affects the Subjects in this Title. Please refer all applications to the legal senior caseworker workbasket via CMS. Please DO NOT remove this note on subsequent Applications.

or

Application CB nnnnn entered on the Register of Community Interests in Land affects the Subjects in this Title. Please refer all applications after <enter todays date> to the legal senior caseworker workbasket via CMS. Please DO NOT remove this note on subsequent Applications.

You may see older variations of this note advising you to refer to senior adviser service or RCIL STL - please refer all such applications to legal senior caseworker workbasket via CMS

How does a Pending or Registered RCIL entry Affect an Application for Registration?

Effect of pending application for community right to buy

In terms of section 37(5)(e) and section 40(1)(a) of the 2003 Act, Scottish Ministers may by notice to the owner or any creditor under a standard security, prohibit them from transferring the land affected by a pending application unless it is an exempt transfer. A list of transfers which are exempt are specified in section 40(4).

A transfer in breach of this prohibition is of no effect (or void) in terms of section 37(8) of the 2003 Act.

Although there is no definition of "transfer" in the Act, the prohibitions in the Act are not intended to affect leases. The grant of a standard security or discharge thereof, or a grant of servitude, are also not considered to be transfers affected by the right to buy.

Effect of registered community right to buy

In terms of section 40(1)(a) of the 2003 Act, for as long as a community interest in land is registered, the owner of the land and any creditor in a standard security having a right to sell the land, is prohibited from transferring that land or any land of which it forms part, unless it is an exempt transfer. A list of transfers which are exempt are specified in section 40(4).

A transfer in breach of this prohibition is of no effect (or void) in terms of section 40(2).

Although there is no definition of "transfer" in the Act, the prohibitions in the Act are not intended to affect leases. The grant of a standard security or discharge thereof, or a grant of servitude, are also not considered to be transfers affected by the right to buy.

The effect of a community body registration in RCIL lasts for five years, but the registration may be renewed for a further five-year period in the last six months of the five-year period under section 44.

The Role of the Registration Officer once Affected Application Identified

In all of these cases, a relevant application for registration of a disposition, including a disposition of minerals or salmon fishings (and any applications which it is, or should be, attached to) should be referred to the RCIL senior caseworker. This is so even where the application purports to be an exempt transfer, or contains a declaration indicating that it is such an exempt transfer. A referral should be made even if the RCIL registration appears to be more than 5 years ago. Whether rejection is required, or other action requires to be taken, will be confirmed by the senior caseworker to the registration officer.

In any case of a registrable deed other than a disposition, the NAN should be retained on the LRS title workdesk as the prohibition will continue to apply and the right to buy may arise in relation to a transfer by that disponee within the life time of the RCIL registration (5 years).

If, after referral, the registration officer is advised to proceed with processing the application, for example because it is accepted that the transfer is exempt, the registration officer should, again, not remove the NAN from the title workdesk. The NAN should also be carried forward onto the LRS title workdesk of a Transfer of Part, if the transfer is not to the Community Body and was claimed to be exempt.

Form of exemption declaration in a disposition

There are a number of exempt transfers not affected by a registered or pending community interest. Where a transfer falls within one of the exempt categories, the deed giving effect to the transfer must, by virtue of section 43, contain an appropriate declaration specifying which provision of section 40(4) operates to make the transfer an exempt one. Additionally, transfers under section 40(4) paragraphs (a), (e) or (h) must also contain a declaration that the transfer does not form part of a scheme, arrangement or series, the purpose of or effect of which is to avoid the provisions of the Act.

There is no statutory style of declaration. However, exempt dispositions submitted for registration have contained a form of declaration similar to the following which might be used where a disposition is a transfer otherwise than for value under section 40(4)(a) of the 2003 Act:

"Declaring that subsection (4)(a) of section 40 of the Land Reform (Scotland) Act 2003 operates to make the transfer effected by this deed one to which subsection (1) of that section does not apply and that the transfer does not form part of a scheme or arrangement and is not one of a series, such as is mentioned in said subsection (1)"

Additional Notification of Rejection to Scottish Ministers

In terms of section 42 of the 2012 Act, where an application for registration is rejected on the basis that the Keeper is not satisfied that the application does not relate to a transfer prohibited either by section 40(1) or section 37(5)(e) of the 2003 Act, the rejection must be notified to Scottish Ministers and a copy of the application supplied.

This duty does not apply where the reason for rejection is that the transaction appears to be exempt, but the declaration that it is exempt and the provision of 40(4) of the 2003 Act under which it is exempt is not included in the disposition being registered.

Whether Scottish Ministers require to be notified of rejection in a particular case is a matter for the RCIL senior caseworker referral point who should seek further guidance if required.

If the registrable deed is a disposition or other conveyance of land and is granted after the date when an application affecting the land in the disposition is either pending or registered in the RCIL, but the disposition does not contain an exemption declaration as set out above, the application for registration may require to be rejected in terms of the general application condition in section 22(1)(c) of the 2012 Act. Where a disposition is not an exempt transfer (so it is not merely that an exemption declaration has been omitted from the disposition), it will also be invalid. As a result, such an application would also be in breach of the condition of registration that the registrable deed is valid, under section 23(1)(b) for a disposition or notice of title inducing first registration, or section 26(1)(a) for registrable deeds submitted as dealings or transfers of part.

The decision to reject, and also whether the rejection of the application should also be notified to Scottish Ministers, is made by the RCIL senior caseworker who should seek further guidance if required.

Asset Transfer Requests

Part 5 of the Community Empowerment (Scotland) Act 2015 allows community bodies to make asset transfer requests to any of a number of public authorities. Such requests allow community bodies to either seek ownership or lease of land or buildings for which they believe better use can be made, or else request rights to manage, occupy or make use of such land for specific purposes.

Prohibition on disposal of land

Once an asset transfer request has been made, an authority may not normally sell, lease or otherwise dispose of the land to which the request relates to any person other than the community body. As soon as an authority is prevented from disposing of land as a consequence of a transfer request, any contract under which the authority is obliged to sell, lease or otherwise dispose of the land to a person other than the community body is void.

This prohibition on disposal does not apply if the land has already been advertised for sale or lease, or if the authority entered in negotiations or began the process to transfer the land to another person prior to the request being made. Such prohibition may also be lifted by direction from Scottish Ministers if sufficient justification is provided as to why the prohibition should be removed.

Role of the registration officer

Registration staff should not undertake a search of public authority asset registers to ascertain if any asset transfer requests have been made. Should evidence of a breach of the above prohibition come to light, a senior adviser should be alerted in the first instance.