Registration Notes

Registration Notes

s58 Land Registration Act 2002 – the register is conclusive as to title

What are the objectives of the scheme of land registration?

There are often said to be three principles which underpin registration:

1. The mirror principle –

   1. According to this all facts material to the title are to be found on the register

2. The curtain principle –

   1. Purchasers need not look behind the register and, in particular, need not be concerned with the operation of trusts

3. The insurance principle –

   1. Where any flaws occur so that the register fails to reflect the title to the property, the person who loses should receive compensation

It has been said that the effect of the new registration scheme to be found in the Land Registration Act 2002 is that it creates a simple system of title by registration as opposed to a system of registration by title – the register is conclusive as to title in relation to registered land.

The potential benefits of a land registration system include:

1. A record of land ownership which is created and maintained by the state

   1. The single system will improve its consistency and thus people’s ability to rely upon it

      1. BUT: the initial expense pf creating and maintaining the system must be taken in to account, including various transaction costs and the like

2. A record of land ownership which is publicly accessible

   1. Information relating to the ownership of land is readily and easily available

      1. BUT: there is a potential compromising of the privacy of land owners

         1. These compromises can be overcome, though, whereby there are exceptions to the publicity of the register

            1. For instance, the absence of witness protection programmes and the like

3. The state guarantees the accuracy of the system

   1. BUT: there is a potential loss of rights as a result of a failure to register or the result of mistakes on the register

      1. This risk is mitigated by the existence of rectification

He de Soto (2001) has argued that the central reason that capitalism has triumphed in the West and failed in the rest of the world is that most of the assets in Western nations have been integrated in to one formal representational system. The potential of a given asset has become easier to evaluate and exchange thus enhancing the production of capital.

Which dispositions need to be registered and what is the effect of their registration?

There are three types of interest that depend upon their existence in the register for their ability to bind third parties. These are:

1. Registrable interests –

   1. These are primarily legal fee simples and leases

2. Registrable dispositions –

   1. Those dispositions made by a registered proprietor which must be completed by registration. They include:

      1. A transfer

      2. A grant of years absolute (i.e. a lease)

         1. Generally only where this is longer than 7 years

      3. An express grant or reservation of an easement

      4. The grant of a legal charge (i.e. mortgages)

3. Minor interests –

   1. This refers to a residual category of interests that must be protected on the register before a third party can be bound

We usually refer to registering registrable interests and dispositions and protecting minor interests.

Registrable Interests: First Registration

We should distinguish between:

1. The fee simple

   1. s3 – any holder of a fee simple can apply for registration

      1. Chapter 2: Cautions against First Registration

         1. s15: Where a person owns an unregistered estate, they may lodge a caution against the registration of its title. Per s16, this will have the effect of forcing the registrar to give the cautioner notice of the application and his right to object to it

   2. Compulsory Registration:

      1. s4 – registration of the fee simple is compulsory after a transfer of the legal title or a mortgage

         1. s6 – the registration must take place within two months of the transfer

      2. s5 – grants a power to the Secretary of State to order make amendment to s4 so as to add to the events which would impose compiler registration

      3. s7 – failure to comply with compulsory registration will render the transfer, grant, or creation void as regards to the transfer, grant or creation of a legal estate

         1. But there will be no impact upon the equitable estate which will be retained

      4. s8 – failure to comply with compulsory registration leading to the need for retransfer regrant or recreation will render the transferee, grantee or mortgagor liable to pay the relevant transaction costs for the retransfer, regrant or recreation

   3. Forms of Registered Title:

      1. s9 establishes three classes of title

         1. Fee simple absolute – this accounts for virtually every case of the fee simple being registered

            1. There is nothing wrong or dubious with the title

         2. Fee simple qualified – this means that there is a specific problem with the title such as the deed being lost

            1. There will be no guarantee in respect of the specified defect

         3. Fee simple possessory – these are designed for cases where the documentary title cannot be proved and the titled deeds depend upon adverse possession

            1. This confers no guarantee at the time of registration

               1. Subsequent problems such as forgery of the newly registered proprietor’s signature on a title will be covered by the guarantee

            2. Possessory titles might be upgraded to absolute titles upon the completion of the requisite period of adverse possession

   4. Effect of First Registration:

      1. s11(3) – registration with absolute title has the effect of vesting in the proprietor the relevant estate alongside all interests subsisting for the benefit of the estate

         1. This is subject to two exceptions:

            1. s11(5) – where the proprietor is a trustee, the beneficiaries’ interests where he has notice of them

            2. s11(4)(c) – adverse possession claims will bind a first proprietor who has notice of them

      2. s11(4) – the estate is vested in the proprietor subject only to the interests protected in the register and overriding interests

         1. Entry of a notice on to the register does not guarantee that the interest will be protected...

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