Searching at Companies House

A prudent buyer of registered land will usually conduct a company search. Although registrations at Companies House do not fix a buyer of registered land with notice of the matters recorded (e.g. liquidation, striking-off, fixed or floating charges), so that a buyer confronted with a clean set of official copies and a clear OS1 search will acquire a good title nonetheless, other aspects of the transaction, beyond pure legal title, may influence the buyer to search. A buyer would normally want to know if a liquidation was on the cards.

What if, having acted prudently, the search throws up a floating charge? Instinct might cause the buyer’s conveyancer to consider requesting a letter of non-crystallisation, to ensure that the charge has not become fixed onto the assets of the seller. But remember, a clean set of official copies, a clear OS1 search, and registration within the priority period will enable the buyer to acquire a good title. If the floating charge is not noted on the register at the Land Registry, then whether it has crystallised or not, it cannot bind the buyer. The buyer is entitled to take the register at the Land Registry as it finds it.

Aggrieved lenders who see registered titles transferred free from their crystallised charge may petition the Land Registry, but to no avail. Any objection, under section 73 LRA 2002, to the buyer’s registration as proprietor free from the charge is groundless: the crystallised charge, not having been noted at the Land Registry, did not bind the buyer. Any application for rectification of the title is further offline: rectification is available to correct a mistake in the register. There has been no mistake: the crystallised charge did not bind the buyer.

But shall we ask for a letter “just to be safe”? Let us not unnecessarily complicate already complicated transactions.