Commentary on Sections Part 1 – Assignation Effective registration Section 28 – Seriously misleading inaccuracies in the assignations record
132.This section makes provision as to whether an entry in the assignations record is seriously misleading as a result of an inaccuracy or inaccuracies in it. This applies for determining whether a registration is an effective registration for the purposes of section 27 of the Act. Section 29(3) of the Act provides for the meaning of “inaccuracy” in the assignations record.
133.Subsection (1)(a) of section 28 provides that an inaccuracy will be seriously misleading if any of subsections (2) to (5) apply or if, despite none of them applying, the inaccuracy or inaccuracies are such that a reasonable person would be seriously misled by the entry. In other words, if any of the examples in subsections (2) to (5) apply then the inaccuracy will be seriously misleading (whether or not any person was actually misled), but those examples are not exhaustive and there may be other inaccuracies that are found by the courts to be seriously misleading. Whether an inaccuracy is seriously misleading or not is to be determined objectively.
134.Subsection (1)(b) provides that any inaccuracy is to be disregarded to the extent that it appears in the assignation document but is not replicated elsewhere in the entry. The effect is that the person searching the record does not have to look at the document to determine whether the details in the record are seriously misleading (although a copy of the assignation document must still be part of the entry in the assignations record and can, for instance, be used as evidence to show that the entry itself was inaccurate).
135.Subsections (1)(c) and (d) deal with an inaccuracy that relates only to part of a claim, or to one co-assignor or co-assignee. These provisions have the effect that an inaccuracy in the assignations record may be seriously misleading in that respect only, and therefore the registration of the assignation document will be partly effective.
136.Subsections (2) and (3) focus on whether an entry contains an inaccuracy that prevents it being disclosed by a properly formatted search. Such an inaccuracy will generally be regarded as being seriously misleading. The point at which the search should be able to disclose an entry is by reference to the person’s name at the date the application for registration was made (which, due to the automated nature of the register, will almost always be virtually the same time as the time at which the entry for the assignation was made up in the RoA). This is necessary given that the Act does not require (as opposed to permit) the updating of an entry to correct a supervening inaccuracy such as a change of name by the assignor (for example, on marriage).
137.Subsection (2) has the effect that an entry is seriously misleading where the assignor (or co-assignor) is a person required by RoA rules to be identified in the assignations record by an identifying number (e.g. a company is likely to be required to be identified by their company number) and where, if a search of the record were to be carried out for that number using the search facility provided under section 33 of the Act, it would not disclose the entry. Given that a company’s number should not change, this situation is only likely to arise where a typo has been made in completing the initial application form, or where the data has been transferred to the register incorrectly. However, it does not matter if the company’s name is wrong as the expectation is that it should be searched for by reference to its number (which will not change in the way that its name might).
138.Subsection (3) has the effect that an entry is seriously misleading where the assignor (or co-assignor) is not a person required by RoA rules to be identified in the assignations record by an identifying number and where, if a search of the record were to be carried out for the assignor’s proper name at the date the application for registration was made, or their name at that date together with their month and year of birth, it would not disclose the entry. This might arise where, for example, there has been an error in completing the application form (or in transferring that data onto the register) and the assignee’s and assignor’s names have been swapped around, or where a typo has been made in providing the assignor’s name or date of birth, etc. Under subsection (3), an error will be seriously misleading if it means that the search function would not find the entry. As such, if the search function is set up to allow close matches (e.g. to show entries with the surname “Thompson” when a search is made for “Thomson”) then a typo in a register entry may not lead to the entry being considered seriously misleading, but if the search function provides exact matches only then a typo of this nature in the information in the register will lead to the entry being considered seriously misleading.
139.Under subsection (3), it is both the assignor’s name and their month and year of birth which matter. This means that even if the search function is programmed to be more forgiving of errors in names if the month and year of birth are also included in the search (and are correct), the entry will still be seriously misleading if the name is wrong to the extent that a search by name alone would not disclose the entry, because it ought to be possible to find the entry by the name alone. However, it is also not enough for the name to be correct; if it is correct but the month/year of birth is wrong, this will also be seriously misleading.
140.Subsection (4) has the effect that an entry is seriously misleading where the name of the assignee (or co-assignee) at the date of application is incorrectly reflected in such a way that a reasonable person would be seriously misled. This might arise in much the same way that an error in the assignor’s name might arise. Because it will not be possible to search by assignee under section 33 (unless RoA Rules alter the position), the position is not determined by reference to whether a search result would return the entry. The application of the reasonable person test means that minor errors such as typos might be disregarded, particularly if other information is correct, but the position will be viewed as a whole in the circumstances of each case. However, the test applies by reference to the assignee’s name at the date of the application. If their name has since changed, there is no obligation on them to update the register to reflect that.
141.Subsection (5) has the effect that an entry is seriously misleading where there is a requirement (by virtue of section 21(1)(g)) for the entry to specify the type of claim assigned but the claim is described as being of the wrong type, or left blank. For example, if the type of claim is a claim to payment of royalties but by mistake it is instead entered as a claim to payment of rent or left unspecified, that would be seriously misleading.
142.Subsection (6) applies the rules in this section to circumstances where there are co-assignors and co-assignees.
143.Subsection (7) enables the Scottish Ministers to modify this section to make provision about what does, and what does not, make an entry seriously misleading and how that is to be determined.
144.Subsection (8) provides that the proper name of a person means the person’s name in the form required by RoA Rules, which might also prescribe a hierarchy of document that could be used to evidence a proper name: for example, a passport, driving licence, or a birth certificate.