Background to Land Registration
When we talk of land registration, we are referring to the registration of land and property in England and Wales on a central Government held register which can be accessed by the general public.
The Land Register was first established in 1862 but it wasn’t until 1925, when some areas of England and Wales became subject to compulsory registration, that we really started to see an increase in registrations. The whole of England and Wales became subject to compulsory registration in 1990 but it was estimated in 2019 by HM Land Registry that 14% of land and properties in England and Wales remained unregistered.
When land or property is subject to a specific event, it must be registered at HM Land Registry within two months of the date that the relevant event occurs (section 6(4) Land Registration Act 2002) otherwise it becomes void for lack of registration and the seller will hold the legal estate on a bare trust for the buyer. Over the years, the triggers for first registration have increased in a bid to try and increase registrations. These include but are not limited to: a freehold conveyance, a legal mortgage, the grant of a Lease for more than seven years and an Assent in relation to a freehold property.
Whilst landowners can wait for one of the specific events to occur so that registration is compulsory, we strongly recommend that landowners consider applying to register any unregistered land or property voluntarily. Although there are exceptions, and this list is not exhaustive, some examples of what can be voluntarily registered are: unregistered freeholds, Leases with at least seven years left to run and profits à prendre in gross (the right to take something from another’s land that is capable of being owned and is a product of nature for example rights to timber or grazing).
Advantages to voluntary registration
There are a number of reasons why land registration is recommended. Firstly, it is more difficult for squatters (and this includes neighbours moving their fence-lines!) to claim adverse possession of registered land than it is of unregistered land because the process/requirements of registration are different. I have had clients in the past who have asked me to register land for them only to find out upon investigation that the land has already been registered to a third party. This can result in a costly and lengthy process whilst the 'genuine' landowner tries to prove his/her ownership of the land and applies for the Register to be rectified.
Land registration can also make the conveyancing process simpler for a buyer and therefore quicker. If there are issues such as missing deeds, registration can make the title more acceptable to a buyer even where a lesser grade of title is awarded (as any defect or missing document can usually be protected by title indemnity insurance if required ). This is because registration is guaranteed by the Government and in the instance that a title has to be rectified, the registered proprietor can be compensated where he/she suffers loss.
Complex registrations can often take some months to be completed by HM Land Registry and it is therefore advantageous for registrations to be done as part of the preparation for sale in scenarios where the title is complex and a buyer's solicitor may ask for registration to take place prior to exchange and completion anyway. Registration is also beneficial where owners are considering borrowing money from a bank which needs to be secured against the landholding as the lending process will be much quicker.
In conclusion, we are still talking about Land Registration years after the Land Register was introduced because there is still a lot of land and property needing registration in England and Wales. Registration is vital to protect landowners from third parties claiming ownership to land which is not theirs and to provide buyers and lenders with certainty that the title is accurate and correct.
The Land Registry offers a reduced fee structure for voluntary registrations which landowners can take advantage of and if you own unregistered land and would like to discuss the likely costs of registering it at the Land Registry please do contact Lucinda Sawhney or a member of the Birketts’ Agriculture Team.
The content of this article is for general information only. It is not, and should not be taken as, legal advice. If you require any further information in relation to this article please contact the author in the first instance. Law covered as at October 2020.