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Shona our Conveyancing Executive from our Bury office explains what you should consider if your property or land has or is partly made up of a possessory title.
When a property is first registered, the Land Registry will grant a class of title depending on the evidence produced to them with the application. There are four classes of title, but most properties are registered with “title absolute”
Title Absolute – this is the best class of title and guarantees the owner has an undisputed right to the property.
However, some properties are registered with possessory title.
Possessory Title – Typically, possessory titles are granted where the owner claims to have acquired the land by adverse possession (actual occupation of the land). Alternatively, it may be where the owner cannot produce documentary evidence of title for some reason. For example, where the title deeds have been lost or destroyed.
The two main differences between absolute title and possessory title are:-
· Possessory title can be set aside if the legal owner presents the Land Registry with sufficient evidence of title
· Possessory title is subject to covenants or rights affecting the property, These will be unknown as the deeds will not have been produced to the Land Registry. These could include matters such as a covenant restricting the use of the property.
Where a property does not have absolute title, the title to the property will generally not be considered to be “good and marketable” and this can affect the value of a property. A lender or purchaser may have concerns regarding the title to the property. Title indemnity insurance can be obtained to provide protection against any possible loss arising from successful claims on the property.
Possessory titles can be upgraded to absolute title.
Upgrading the class of title – Who can apply?
Under section 62(7) of the Land Registration Act 2002 only the following are entitled to apply to upgrade an inferior class of title to a better one.
· The registered proprietor
· A person entitled to be registered as proprietor, such as personal representatives where the registered proprietor has died or an Attorney
· The proprietor of any registered charge affecting the estate
· A person interested in a registered estate that derives from the registered estate to be upgraded
Possessory titles after lapse of time
Where title to land is a possessory one, you can apply to upgrade the title to absolute freehold once the possessory title has been registered for 12 years. The date on which the title was first registered is stated in the property register and is taken as the date on which the first proprietor was registered.
Possessory titles in other situations
You can apply at any time after registration to upgrade a possessory title by producing additional evidence of title to the Land Registry that would remedy the reason why a possessory title was granted. For example, if the original title deeds are found.
Please note this article is provided for general information purposes only to clients and friends of Hayward Moon Limited. It is not intended to impart legal advice on any matter. Specialist advice should be taken in relation to specific circumstances. Whilst we endeavour to ensure that the information in this article is correct, no warranty, express or implied, is given as to its accuracy, and Hayward Moon Limited does not accept any liability for error or omission.
