Land Registration Act 2002
Encyclopedia
The Land Registration Act 2002 (c 9) is an Act
of the Parliament
of the United Kingdom
which repealed and replaced previous legislation governing land registration
, in particular the Land Registration Act 1925
, which governed an earlier, though similar, system. , the Act, together with the Land Registration Rules, regulates the role and practice of HM Land Registry
.
and HM Land Registry report, Land Registration for the Twenty-first Century (2001). The Act:
The Act made some major changes to the law regulating registered land. Specifically, it:
in land is compulsory when one of the following events occurs:
Failure to register when required, means that the purchaser or transferee gains only an equitable title to the land and the seller or transferor remains as the registered proprietor. A person with an equitable title, i.e. who has failed to register, cannot take advantage of the priority rules found in sections 29 and 30 of the Act and may be vulnerable if the (still) registered proprietor attempts another dealing with the land.
In the case of freehold estates, one of the following grades of title may be awarded according to s. 11 of the Act:
In the case of leasehold estates, one of the following grades of title may be awarded according to s. 12 of the Act:
According to s. 27(1): "If a disposition is required to be completed by registration it does not operate at law until the relevant requirements are met."
All other interests are postponed to the interest under the disposition - i.e. the successfully registered purchaser's interest gets priority over all other interests.
Note: if the transferee is not a purchaser (such as the recipient of a gift, or under a will), he or she takes the title subject to all pre-existing proprietary interests affecting the land - see s.28 LRA 2002
This is the appropriate way of alerting a purchaser of the existence of an equitable family interest which arises under a trust of land. A restriction does not protect the priority of that interest, nor any right of occupation – it notifies the purchaser of the interest. In any event, in the normal case, the purchaser will overreach and in such cases it is immaterial whether the purchaser knows of the equitable family interest or not. (Law of Property Act 1925; Trusts of Land and Appointment of Trustees Act 1996)
Restrictions are also useful to control dealings with the land as a secondary means of protection. For example, a person with an option to purchase land (e.g. a developer) should protect that interest by means of a Notice. However, they may also enter a restriction to prevent, or to be alerted to, any attempt to transfer the land in breach of the option.
According to s. 33, the following interests cannot be protected by a notice:
In all cases, these interests are protected against a purchaser by other means.
According to s. 34, all other interests may be protected by a notice. Examples include:
in relation to registered land (the rules applicable to unregistered land remain the same, and 12 years occupation nec vi, nec clam, nec precario
is still required to obtain title).
The Act provides that anyone who occupies registered land without permission from the owner and treats it as his own for 10 years is entitled to apply to be registered as owner, although the system introduced by the Act means that few claims will succeed. Specifically, according to paragraph 1(1) of Schedule 6 to the Act:
The Land Registry is obliged to notify the registered proprietor of the land that an application for possessory title has been made. The registered proprietor then has 65 days to object to the registration. The objection may dispute the applicant's right to be registered as owner or, more usually, the registered proprietor will claim the benefit of the process found in paragraph 5 of Schedule 6. This provides that a registered proprietor who objects has a further two years to evict the adverse possessor. It will be enough to secure eviction within these two years that the registered proprietor relies on their registered title. No other reason need be given. Failure to secure the eviction of the adverse possessor within these two years gives the adverse possessor the right to re-apply to be registered and such a second application will be successful.
In three special cases, the adverse possessor may be registered as proprietor without having to wait for two further years and even if the proprietor objects. These special cases usually arise because the adverse possessor has some other reason for claiming ownership in addition to their possession for (at least) 10 years.
The new rules regulating adverse possession can be found in Part 9 of the Act, and the rules regulating the procedures for registration of an adverse possessor can be found at Schedule 6 to the Act.
These rules are much more difficult to satisfy than the common law
with regard to adverse possession, although it is now clear that all rules of adverse possession (in unregistered land, under the LRA 1925 and under the LRA 2002 are human rights compliant, see generally the judgment of the Grand Chamber of the European Court of Human Rights in J.A. Pye (Oxford) Land Ltd v United Kingdom
A registered proprietor need simply object and then proceed to evict within two years. The adverse possessor's claim is therefore vulnerable under the 2002 Act and the registered proprietor is protected in all but the most unusual circumstances.
After the passage of the Act, local councils and other organisations with large land holdings began the systematic registration of their land in order to prevent title being lost to squatters.
(ss.107-114). The Adjudicator also hears appeal
s from aggrieved persons on decisions of the Registrar as to access to the Land Registry Network (Sch.5).
The Adjudicator can make any order
which the High Court
could make for the rectification
or setting aside of certain dispositions, contract
s and other documents affecting interests in land. Appeals from the decision of the Regulator can be made to the High Court (s.111).
As of 1 November 2007, the Adjudicator came under the supervision of the Administrative Justice and Tribunals Council
and will become part of the UK tribunal system as reformed under the Tribunals, Courts and Enforcement Act 2007
.
Act of Parliament
An Act of Parliament is a statute enacted as primary legislation by a national or sub-national parliament. In the Republic of Ireland the term Act of the Oireachtas is used, and in the United States the term Act of Congress is used.In Commonwealth countries, the term is used both in a narrow...
of the Parliament
Parliament
A parliament is a legislature, especially in those countries whose system of government is based on the Westminster system modeled after that of the United Kingdom. The name is derived from the French , the action of parler : a parlement is a discussion. The term came to mean a meeting at which...
of the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
which repealed and replaced previous legislation governing land registration
Land registration
Land registration generally describes systems by which matters concerning ownership, possession or other rights in land can be recorded to provide evidence of title, facilitate transactions and to prevent unlawful disposal...
, in particular the Land Registration Act 1925
Land Registration Act 1925
The Land Registration Act 1925 was a act of Parliament in the United Kingdom that codified and extended the system of land registration in England and Wales...
, which governed an earlier, though similar, system. , the Act, together with the Land Registration Rules, regulates the role and practice of HM Land Registry
HM Land Registry
Land Registry is a non-ministerial government department and executive agency of the Government of the United Kingdom. It was created in 1862 to register the ownership of land and property in England and Wales...
.
Background
The Land Registration Act 2002 was introduced in response to the Law CommissionLaw Commission
A Law Commission or Law Reform Commission is an independent body set up by a government to conduct law reform; that is, to consider the state of laws in a jurisdiction and make recommendations or proposals for legal changes or restructuring...
and HM Land Registry report, Land Registration for the Twenty-first Century (2001). The Act:
- Simplified and modernised the law of land registration;
- Made the register reflect a more accurate picture of a title to land, showing more fully the rights and subsidiary interests that affect it; and
- Was intended to facilitate the introduction of e-conveyancing.
The Act made some major changes to the law regulating registered land. Specifically, it:
- Enabled shorter leaseLeaseA lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
s to be registered; - Further encouraged voluntary land registration;
- Changed the system of protection of third party rights; and
- Reformed and modernised the law of adverse possessionAdverse possessionAdverse possession is a process by which premises can change ownership. It is a common law concept concerning the title to real property . By adverse possession, title to another's real property can be acquired without compensation, by holding the property in a manner that conflicts with the true...
(squatters' rights).
- Land Transfer Act 1875
- Land Registration Act 1925Land Registration Act 1925The Land Registration Act 1925 was a act of Parliament in the United Kingdom that codified and extended the system of land registration in England and Wales...
Land registration
Section 4 stipulates that registration of an estateEstate (law)
An estate is the net worth of a person at any point in time. It is the sum of a person's assets - legal rights, interests and entitlements to property of any kind - less all liabilities at that time. The issue is of special legal significance on a question of bankruptcy and death of the person...
in land is compulsory when one of the following events occurs:
- Freehold estate is transferred, whether under a sale, gift or other circumstances;
- Legal leaseLeaseA lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
for more than seven years is granted; - Legal lease with more than seven years to run is transferred; or
- Grant of a first legal chargeSecurity interestA security interest is a property interest created by agreement or by operation of law over assets to secure the performance of an obligation, usually the payment of a debt. It gives the beneficiary of the security interest certain preferential rights in the disposition of secured assets...
(mortgage).
Failure to register when required, means that the purchaser or transferee gains only an equitable title to the land and the seller or transferor remains as the registered proprietor. A person with an equitable title, i.e. who has failed to register, cannot take advantage of the priority rules found in sections 29 and 30 of the Act and may be vulnerable if the (still) registered proprietor attempts another dealing with the land.
Grades of title
On first registration, the registrar awards a grade of title to each registered estate.In the case of freehold estates, one of the following grades of title may be awarded according to s. 11 of the Act:
- Absolute title - This shows there is nothing dubious about the title. The estate is vested in the proprietor and is subject only to entries on the register and unregistered interests which override (commonly called an overriding interestOverriding interestOverriding interest is an English land law concept. The general rule in registered conveyancing is that all interests and rights over a piece of land have to be written on the register entry for that land, otherwise, when anyone buys that piece of land, the interests won't apply to the purchaser,...
). Title does not have to be perfect - if the registrar believes that any defect will "not cause the holding under the title to be disturbed", absolute title will be given - s.9(3) LRA.
- Possessory freehold title – there is no documentary evidence of title (e.g. lost title deeds). Title depends on adverse possessionAdverse possessionAdverse possession is a process by which premises can change ownership. It is a common law concept concerning the title to real property . By adverse possession, title to another's real property can be acquired without compensation, by holding the property in a manner that conflicts with the true...
. It conveys no guarantee of title at the time of registration, but subsequent problems (e.g. forgery of proprietor's signature) will be covered by the guarantee. It can be upgraded into absolute title after being in possession as proprietor for 12 years (s.62(1), (4)).
- Qualified freehold title - the title is subject to a fundamental defect. There is no guarantee in respect of the specified defect. It may be upgraded to absolute title if registrar is satisfied as to the title - s.62 LRA.
In the case of leasehold estates, one of the following grades of title may be awarded according to s. 12 of the Act:
- Absolute leasehold title - same as absolute freehold except the proprietor is also subject to covenants in the leaseLeaseA lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
- Good leasehold title - same as absolute leasehold except the right of the landlord to grant the lease is not guaranteed
- Possessory leasehold title - same as possessory freehold
- Qualified leasehold title - same as qualified freehold
Registerable dispositions
Dispositions subject to registration according to s. 27 are:- any transfer of a freehold, whether for value or by way of gift or on death
- the grant of a legal leaseLeaseA lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
for more than seven years - the grant of a legal lease taking effect in possession in three or more months from grant
- the grant of a legal charge (a mortgage)
- the express grant of legal easement
According to s. 27(1): "If a disposition is required to be completed by registration it does not operate at law until the relevant requirements are met."
Priority
According to s. 29 of the Act, a person acquiring an interest under a registrable disposition for valuable consideration (being usually a freehold or leasehold, but also including a legal mortgage) and having been registered successfully as owner of the interest, takes it subject to only:- an entry on the register, mainly a Notice in the charges register
- unregistered interests which override (overriding interestOverriding interestOverriding interest is an English land law concept. The general rule in registered conveyancing is that all interests and rights over a piece of land have to be written on the register entry for that land, otherwise, when anyone buys that piece of land, the interests won't apply to the purchaser,...
s) - interests excepted from the effects of registration (a category now otiose)
- and if the estate is a lease, to burdens incidental to the lease
All other interests are postponed to the interest under the disposition - i.e. the successfully registered purchaser's interest gets priority over all other interests.
Note: if the transferee is not a purchaser (such as the recipient of a gift, or under a will), he or she takes the title subject to all pre-existing proprietary interests affecting the land - see s.28 LRA 2002
Restrictions
A restriction on the proprietorship register prevents the registration of a disposition unless complied with.This is the appropriate way of alerting a purchaser of the existence of an equitable family interest which arises under a trust of land. A restriction does not protect the priority of that interest, nor any right of occupation – it notifies the purchaser of the interest. In any event, in the normal case, the purchaser will overreach and in such cases it is immaterial whether the purchaser knows of the equitable family interest or not. (Law of Property Act 1925; Trusts of Land and Appointment of Trustees Act 1996)
Restrictions are also useful to control dealings with the land as a secondary means of protection. For example, a person with an option to purchase land (e.g. a developer) should protect that interest by means of a Notice. However, they may also enter a restriction to prevent, or to be alerted to, any attempt to transfer the land in breach of the option.
Notices
According to s. 32 of the Act: "A notice is an entry on the [charges] register in respect of a burden of an interest affecting a registered estate or charge."According to s. 33, the following interests cannot be protected by a notice:
- the interest of a beneficiaryBeneficiary (trust)In trust law, a beneficiary or cestui que use, a.k.a. cestui que trust, is the person or persons who are entitled to the benefit of any trust arrangement. A beneficiary will normally be a natural person, but it is perfectly possible to have a company as the beneficiary of a trust, and this often...
under a trustTrust lawIn common law legal systems, a trust is a relationship whereby property is held by one party for the benefit of another...
of land - a leaseLeaseA lease is a contractual arrangement calling for the lessee to pay the lessor for use of an asset. A rental agreement is a lease in which the asset is tangible property...
granted for less than three years - restrictive covenantRestrictive covenantA restrictive covenant is a type of real covenant, a legal obligation imposed in a deed by the seller upon the buyer of real estate to do or not to do something. Such restrictions frequently "run with the land" and are enforceable on subsequent buyers of the property...
s in a lease - and certain other minor property rights.
In all cases, these interests are protected against a purchaser by other means.
According to s. 34, all other interests may be protected by a notice. Examples include:
- equitable easements
- freehold restrictive covenants
- equitable leases
- estate contracts, including options to purchase and rights of pre-emption.
Adverse possession
The Act is known for the changes it has made to the rules regulating adverse possessionAdverse possession
Adverse possession is a process by which premises can change ownership. It is a common law concept concerning the title to real property . By adverse possession, title to another's real property can be acquired without compensation, by holding the property in a manner that conflicts with the true...
in relation to registered land (the rules applicable to unregistered land remain the same, and 12 years occupation nec vi, nec clam, nec precario
Nec vi, nec clam, nec precario
Nec vi, nec clam, nec precario, is a Latin legal term meaning 'not by force, nor stealth, nor licence'. It is the principle by which rights may be built up over time, principally public rights of way in the United Kingdom...
is still required to obtain title).
The Act provides that anyone who occupies registered land without permission from the owner and treats it as his own for 10 years is entitled to apply to be registered as owner, although the system introduced by the Act means that few claims will succeed. Specifically, according to paragraph 1(1) of Schedule 6 to the Act:
- A person may apply to the registrar to be registered as the proprietor of a registered estate in land if he has been in adverse possession of the estate for the period of ten years ending on the date of the application.
The Land Registry is obliged to notify the registered proprietor of the land that an application for possessory title has been made. The registered proprietor then has 65 days to object to the registration. The objection may dispute the applicant's right to be registered as owner or, more usually, the registered proprietor will claim the benefit of the process found in paragraph 5 of Schedule 6. This provides that a registered proprietor who objects has a further two years to evict the adverse possessor. It will be enough to secure eviction within these two years that the registered proprietor relies on their registered title. No other reason need be given. Failure to secure the eviction of the adverse possessor within these two years gives the adverse possessor the right to re-apply to be registered and such a second application will be successful.
In three special cases, the adverse possessor may be registered as proprietor without having to wait for two further years and even if the proprietor objects. These special cases usually arise because the adverse possessor has some other reason for claiming ownership in addition to their possession for (at least) 10 years.
The new rules regulating adverse possession can be found in Part 9 of the Act, and the rules regulating the procedures for registration of an adverse possessor can be found at Schedule 6 to the Act.
These rules are much more difficult to satisfy than the common law
Common law
Common law is law developed by judges through decisions of courts and similar tribunals rather than through legislative statutes or executive branch action...
with regard to adverse possession, although it is now clear that all rules of adverse possession (in unregistered land, under the LRA 1925 and under the LRA 2002 are human rights compliant, see generally the judgment of the Grand Chamber of the European Court of Human Rights in J.A. Pye (Oxford) Land Ltd v United Kingdom
A registered proprietor need simply object and then proceed to evict within two years. The adverse possessor's claim is therefore vulnerable under the 2002 Act and the registered proprietor is protected in all but the most unusual circumstances.
After the passage of the Act, local councils and other organisations with large land holdings began the systematic registration of their land in order to prevent title being lost to squatters.
Objection and adjudication
Anybody may make an objection to the Registrar about an application (s.73). The Registrar must advise the applicant and, so long as the objection is not groundless, must dispose of the objection by agreement between the parties. If agreement cannot be reached, the matter must be referred to the Adjudicator who is appointed by the Lord ChancellorLord Chancellor
The Lord High Chancellor of Great Britain, or Lord Chancellor, is a senior and important functionary in the government of the United Kingdom. He is the second highest ranking of the Great Officers of State, ranking only after the Lord High Steward. The Lord Chancellor is appointed by the Sovereign...
(ss.107-114). The Adjudicator also hears appeal
Appeal
An appeal is a petition for review of a case that has been decided by a court of law. The petition is made to a higher court for the purpose of overturning the lower court's decision....
s from aggrieved persons on decisions of the Registrar as to access to the Land Registry Network (Sch.5).
The Adjudicator can make any order
Court order
A court order is an official proclamation by a judge that defines the legal relationships between the parties to a hearing, a trial, an appeal or other court proceedings. Such ruling requires or authorizes the carrying out of certain steps by one or more parties to a case...
which the High Court
High Court of Justice
The High Court of Justice is, together with the Court of Appeal and the Crown Court, one of the Senior Courts of England and Wales...
could make for the rectification
Rectification (law)
Rectification is a remedy whereby a court orders a change in a written document to reflect what it ought to have said in the first place. It is an equitable remedy, which means the circumstances where it can be applied are limited....
or setting aside of certain dispositions, contract
Contract
A contract is an agreement entered into by two parties or more with the intention of creating a legal obligation, which may have elements in writing. Contracts can be made orally. The remedy for breach of contract can be "damages" or compensation of money. In equity, the remedy can be specific...
s and other documents affecting interests in land. Appeals from the decision of the Regulator can be made to the High Court (s.111).
As of 1 November 2007, the Adjudicator came under the supervision of the Administrative Justice and Tribunals Council
Administrative Justice and Tribunals Council
The Administrative Justice and Tribunals Council is a non-departmental public body in the United Kingdom, responsible for supervising and regulating administrative justice and tribunals...
and will become part of the UK tribunal system as reformed under the Tribunals, Courts and Enforcement Act 2007
Tribunals, Courts and Enforcement Act 2007
The Tribunals, Courts and Enforcement Act 2007 is an Act of the Parliament of the United Kingdom. It provides for several diverse matters relating to the law, some of them being significant changes to the structure of the courts and fundamental legal procedures...
.