The Lands Tribunal for Scotland recently published its opinion in Aslam v The Keeper of the Registers of Scotland. This case deals with the proper level of compensation to be paid where a home owner's title has been "rectified" by the Keeper of the Registers of Scotland.

"Rectification" of title

Rectification takes place when a property title indicates that something belongs to the owner, but the real position is that it does not. The Keeper has a duty to fix the inaccuracy where it is manifestly obvious. In this case, the title to Mrs Aslam's flat indicated that the property also included "the garden ground pertaining thereto". In other words, that Mrs Aslam owned the flat and an area of garden.

When it became clear that this area had been included in the title for Mrs Aslam's flat in error, the Keeper deleted reference to the garden grounds. Compensation is due in such circumstances because the Keeper provides a warranty- in the vast majority of cases - that what is registered on the title is accurate. The question in issue between Mrs Aslam and the Keeper was the correct level of compensation to be paid.

Level of compensation

Over the years, the garden behind Mrs Aslam's flat had become used for car parking on an informal basis. The Tribunal approached the valuation in terms of this current use. It explained that the ground could not be valued as if it was used as an ornamental garden. The Tribunal also rejected Mrs Aslam's request to take into account what she said were alternative uses for the ground, such as for a beauty salon or retail premises.

Both parties sought to influence the Tribunal's valuation by reference to the price of what they claimed were comparable car parking sites. These included lock-up garages in the area; a nearby land sale from 2002; the asking price of a corner of land that had not yet sold; and parking spaces in two different parts of the city - neither of which was particularly close to Mrs Aslam's flat.

Perhaps unsurprisingly, the Tribunal judged that none of these transactions could be of direct assistance in identifying the correct, current value of the land behind Mrs Aslam's flat. They were each either too different from this land, sales from too long ago, too uncertain, or too far away to provide a direct comparison.

The Tribunal was left in the position of using its judgement and - as is narrated in its opinion - an element of intuition in establishing the market value of the land. The level of compensation was set at £22,400 - far short of the £50,000 that Mrs Aslam had hoped for.

Key things to note

The Tribunal will consider current land use to be a valid starting point in establishing the valuation. Land put to use as something that can support economic activity (car parking in this instance) will often attract a higher rate of compensation than simple garden ground.

When setting out a claim, producing a directly relevant, recent price-comparison to the land in issue will provide welcome assistance to the Tribunal in establishing the market value of a party's loss.