Land Registration Act 1925

61 Protection of creditors prior to registration of trustee in bankruptcy.

(1) The registrar shall as soon as practicable after registration of a petition in bankruptcy as a pending action under the Land Charges Act, 1925, register a notice (in this Act called a creditors' notice) against the title of any proprietor of any registered land or charge which appears to be affected, and such notice shall protect the rights of all creditors, and unless cancelled by the registrar in the prescribed manner such notice shall remain in force until a bankruptcy inhibition is registered or the trustee in bankruptcy is registered as proprietor.

No fee shall be charged for the registration of the notice.

(2) Until a creditors' notice is registered, a petition in bankruptcy filed after the commencement of this Act shall not, as respects any registered disposition for money or money's worth of any registered land or charge, be notice or evidence of any act of bankruptcy therein alleged.

(3) The registrar shall, as soon as practicable after registration of a receiving order in bankruptcy under the Land Charges Act, 1925, enter an inhibition (in this Act called a bankruptcy inhibition) against the title of any proprietor of any registered land or charge which appears to be affected. No fee shall be charged for the registration of the inhibition.

(4) From and after the entry of a bankruptcy inhibition (but without prejudice to dealings with or in right of interests or charges having priority over the estate or charge of the bankrupt proprietor), no dealing affecting the registered land or charge of the proprietor, other than the registration of the trustee in bankruptcy, shall be entered on the register until the inhibition is vacated as to the whole or part of the land or charge dealt with.

(5) If and when a proprietor of any registered land or charge is adjudged bankrupt, his registered estate or interest, if belonging to him beneficially, and whether acquired before or after the date of adjudication, shall vest in the trustee in bankruptcy in accordance with the statutory provisions relating to bankruptcy for the time being in force.

(6) Where under a disposition to a purchaser in good faith for money or money's worth such purchaser is registered as proprietor of an estate or a charge, then, notwithstanding that an available act of bankruptcy has been committed by the person making the disposition, the title of his trustee in bankruptcy acquired after the commencement of this Act shall, as from the date of such disposition, be void as against such purchaser unless at the date of such disposition, either a creditors' notice or a bankruptcy inhibition has been registered, but a purchaser who, at the date of the execution of the registered disposition, has notice of an available act of bankruptcy, or of the receiving order, or adjudication, shall not be deemed to take in good faith.

Nothing in this section shall impose on a purchaser a liability to make any search under the Land Charges Act, 1925.

(7) Where the estate or assets of a bankrupt proprietor suffer loss by reason of the omission of the registrar to register a creditors' notice or bankruptcy inhibition, as required by this section, or on account of the execution or registration of a disposition after a petition is registered as a pending action or after a receiving order is registered and before the registration of a creditors' notice or bankruptcy inhibition, the trustee in bankruptcy shall be entitled to indemnity as a person suffering loss by reason of an error or omission in the register.

(8) If neither a creditors' notice nor a bankruptcy inhibition is registered against a bankrupt proprietor, nothing in this section shall prejudicially affect a registered disposition of any registered land or charge acquired by the bankrupt after adjudication which would have been valid by virtue of section forty-seven of the [4 & 5 Geo. 5. c. 59.] Bankruptcy Act, 1914, if the land or charge had not been registered.

(9) If and when a bankruptcy inhibition is wholly or partially vacated, for any cause other than by reason of the registration of the trustee in bankruptcy, any registered estate or interest vested in the trustee in bankruptcy shall, as respects the registered land or charge to which the vacation extends, be divested and the same shall vest in the proprietor in whom it would have been vested if there had been no adjudication in bankruptcy.

(10) The official receiver or trustee in bankruptcy may inspect the register so far as it relates to any proprietor against whom a receiving order has been made, and any creditor, on behalf of himself and all other creditors, or the official receiver or trustee in bankruptcy, may lodge a caution against any such proprietor in respect of any minor interest affecting the registered land.