Comprehensive Study Material on Land Registration

Learning Outcomes

Understand the historical position of land registration.
Appreciate the aims of the Land Registration Act 2002 (LRA 2002).
Explore Schedule 1 and Schedule 3 of the LRA 2002.
Comprehend the principles of overriding interests and the principles of overreaching equitable interests held in land.

Definition of Land Registration

Land Registration refers to the formal process where title to the land (the ‘estate’ in land) is recorded in a central register managed by the Land Registry.
Historical Context:

First voluntary land title registration attempted in 1862 in England and Wales, followed by unsuccessful statutes in 1875 and 1897.
The first compulsory and nationwide system of land registration was introduced by the Land Registration Act 1925, which came into force on January 1, 1926.
The LRA 1925 was repealed and replaced by the Land Registration Act 2002, which commenced on October 13, 2003.

Land Registration Act 2002

Based on the Law Commission Report No. 271, titled "Land Registration for the 21st Century: A Conveyancing Revolution" (2001).
The draft of the Land Registration Bill passed unchanged through Parliament.
As of the 2019-20 Land Registry Annual Report, approximately 87.4% of land in England and Wales is registered.

Main Aims of the LRA 2002

Introduce a strengthened, simplified, and modernized scheme of title registration.
Update the substantive principles of land registration.
Provide a framework for eventual electronic conveyancing.
Facilitate efficient and cost-effective transfer of estates and interests in land while protecting third-party property interests.
Maximize the registration of estates, interests, and property rights.
Build upon the foundations of the earlier LRA 1925.

Aims of Land Registration

Ensure an accurate reflection of land status at any given time for minimal inquiries.
Reduce investigation costs and streamline the conveyancing process.
Lower the risk of fraud and provide protection to purchasers against bad title.
Alert potential purchasers to existing property rights burdening the land.
Clarify and standardize the conveyancing process.
Support the real estate market, benefiting the economy.

Registrable Estates

Not all estates are registrable under LRA 2002; only qualifying estates are.
A registrable estate must be registered upon creation or transfer, with only legal estates eligible.
Examples of registrable estates include:

Legal freehold estates.
Legal leasehold estates (leases over 7 years or with more than 7 years left at transfer).

Non-registrable estates comprise life estates or short leases under 7 years.

Features of Registered Land

Registered land remains registered indefinitely; subsequent transactions occur through the Land Register.
The Land Register is updated with any changes in ownership or transactions.

The Registers

The official land registration consists of three primary components:

The Property Register: Describes the land, classifies the title (freehold/leasehold), includes plans, and lists interests benefiting the land (e.g., easements, covenants).
The Proprietorship Register: Indicates the class of title, details of the registered proprietor (name, address), the date of registration, and monetary information.
The Charges Register: Records third-party rights negatively affecting title (such as registered charges, mortgages, and restrictive covenants).

Registrable Dispositions under S.27 LRA 2002

Transfer of a registered fee simple.
Transfer of a registered lease.
Grant of a lease (for terms exceeding 7 years) from a registered estate.
Grant of a reversionary lease from a registered estate.
Grant of a discontinuous lease from a registered estate.
Grant or reservation of a legal easement.
Grant of a legal charge/mortgage.

Completing Registrable Dispositions

Sections 25, 26, and 27 establish that a registrable disposition’s transfer is not complete until the new owner appears on the Land Register as the registered proprietor.
Registration is deemed to occur when the application is submitted to the Land Registry.
Once registered, the new owner’s title is conclusive according to Section 58 LRA 2002.
The registered proprietor then gains full authority over the land, per Section 23 LRA.

The 'Priority' Rules

The Basic Priority Rule: A transferee who is not a purchaser takes land subject to all prior third-party property rights.
The Special Priority Rule: If a transferee provides consideration (i.e., is a purchaser), they take free from all unregistered, pre-existing third-party property rights, except registered charges and overriding interests (as per Schedule 3 LRA).

Three Basic Principles of Land Registration

Former Chief Land Registrar Theodore Ruoff articulated three key principles:

The Mirror Principle: The register must reflect all legal title conditions accurately.
The Curtain Principle: Buyers need not be aware of beneficial ownership or trust details that do not appear on the register.
The Insurance Principle: The register's accuracy is guaranteed by the state, ensuring compensation for losses due to register errors.

Exceptions to the Mirror Principle

Some interests that override first registrations or registered dispositions are not shown in the Land Register.
There is jurisdiction for alterations and rectifications to the register.

Overreaching and Registered Land

Overreaching involves equity rights, typically requiring payments to two or more trustees for full effect. Key cases include:

City of London Building Society v Flegg (1988): Interest overreached, allowing compensation from sale proceeds.
Williams & Glyn’s Bank v Boland (1981): No overreaching without adequate payments to trustees; equitable interests remain enforceable.
HSBC v Dyche (2009): Overreaching not applicable in fraud scenarios.

Operation of Registered Land

Purchasers of registered titles are bound by all protected third-party property rights noted in the register.
Rights not registered typically do not bind purchasers unless they qualify as overriding interests or override unregistered interests.
The registration of titles is central to the operation of land registration, with Section 58 determining that registered proprietors possess the legal estate noted in the register.
Even if registration arises from fraud, the title remains valid, subject to potential rectification claims.
A registered proprietor enjoys all rights associated with absolute ownership, subject to register entries as per Sections 23 and 26.

Applications for Registration

Purchasers of registrable titles not previously registered have two months from practical completion to apply for registration.
Failure to register in this timeframe renders the purchase void concerning the transfer of legal estate, leaving the purchaser with merely equitable title.

Unregistered Third Party Interests

Unregistered interests listed in Schedule 1 LRA 2002 can override the estate of a first registered proprietor (both freeholds and leaseholds).
Registered unregistered interests cease to hold overriding status.
Notable overriding interests include:

Schedule 1(1): Legal leases for 7 years or less, which may override first registrations.
Schedule 1(2): Interests of persons in actual occupation—those who have property rights and occupy the land at the time of the purchaser's application for first registration.
Actual occupation is a factual question determined by evidence at trial.

Schedule 1: Interests in Actual Occupation

Third parties must demonstrate actual occupation for their rights to be overriding and binding on the purchaser.
Occupants include those physically present and caretakers representing property owners.
Sufficient evidence of continuity and permanence in presence may establish actual occupation despite temporary absences.

Schedule 3: Overriding Interests

Similar in some respects to Schedule 1 but applies to registered dispositions.
Key aspects include:

Schedule 3(1): Leasehold estates for 7 years or less continue to bind purchasers of registered dispositions.
Schedule 3(2): Protects rights of persons in actual occupation, emphasizing discoverability during inspection.

Case Law References

Important cases to consider include:

Williams & Glyn’s Bank v Boland (1981)
Abbey National v Cann (1991)
Link Lending v Bustard (2010)

Key Takeaways

The operation of registered land hinges on both the principles of the LRA 2002 and its substantiated case law, crucial for understanding interests in land and property rights.
Understanding the nature of register entries, registrable dispositions, and overriding interests is essential for navigating land registration and protecting property rights.

Comprehensive Overview of Land Registration and the Land Registration Act 2002

Comprehensive Overview of Land Registration and the Land Registration Act 2002