The Land Registration Act 2002

“Wilt thou do the deed and repent it? Thou hadst better never been born,” (Sigurd the Volsung, William Morris, 1834-1896). Forgive the pun, but to help readers avoid doing or rather registering their “deeds” wrongly, ECA has asked Ros Lovell of the York Land Registry to summarise the changes wrought by The Land Registration Act 2002 and the Land Registration Rules 2003. For non-property lawyers and other readers outside the legal profession, this might seem unimportant, but it marks the end of some familiar documents. The land certificate and the charge certificate will be no more. There are also changes to one area surrounded by popular myth, namely adverse possession, or “squatter’s rights”.

The Land Registration Act 2002 (the Act) and the Land Registration Rules 2003 (the Rules), came into force on 13 October 2003. They brought significant changes to the land-registration system. The fundamental objective underpinning the Act is that the register should be a complete and accurate reflection of the state of the title to land at any given time and that it should be possible to investigate title to land online with the minimum of additional enquiries and inspections. The Act, therefore, provides a framework for the development of electronic conveyancing, extends the benefit of registration to additional interests in land and makes the register more comprehensive.

The Act makes many important changes and the purpose of this article is to highlight those that will have the most immediate and direct impact in practice.

Land and charge certificates

These are abolished from 13 October 2003 and any application lodged at the Land Registry on or after 13 October 2003 need not be accompanied by the land or charge certificate. This means that if your client has lost his or her land certificate there will be no need to apply for a replacement certificate unless an application needs to be submitted to the Registry before 13 October 2003. The Land Registry will not issue any land or charge certificates after 13 October 2003. Instead, on completion of an application, a title information document will be issued. This will have attached to it an official copy of the register and, in the case of a first registration or any application, which has generated a change to a title plan, an official copy of the title plan.

Existing land and charge certificates will not be recalled and the bundle of deeds lodged in support of an application for first registration will continue to be returned to the applicant’s solicitor on completion of a registration.

The abolition of land and charge certificates is an essential step towards e-conveyancing, but may well cause some concern to landowners. Clients may well need to be reassured that their ownership of land is not prejudiced or affected in any way. The register of their title will still exist – but in electronic form. Leases Any lease granted for more than seven years or assigned or assented when over seven years are left to run, is compulsorily registerable. In addition, any lease taking effect more than three months after the date of the lease, no matter what the term, must be registered. Timeshare leases of whatever length may be voluntarily registered if granted out of unregistered land and must be registered if granted and out of registered land.

Charges

The system of creating and registering charges is largely unaffected by the Act. However, the Land Registry will no longer notify a prior lender if a second or subsequent charge is lodged for registration and responsibility for notifying a prior chargee rests with the subsequent chargee. This change simply reflects what already happens in practice and should not, therefore, cause any great difficulty.

Overriding interests

The Act refers to “interests which override”. These are the interests that bind a registered proprietor although not noted on the register. These interests are reduced both in number and in scope. As a general rule, overriding interests will now have to be disclosed when application is made for first registration or to register a dealing. A new panel is included in the revised application forms FR1 and AP1 to enable this to be done, or a certificate given that there are no such interests. Once disclosed, the interest will be noted on the register and its overriding status will be lost.

Although the interests of persons in actual occupation will continue to override there are important changes in this area. Any rights protected are confined to the part of the property actually occupied and a further change is that it is no longer relevant to whether an occupier’s right will override first registration whether or not enquiry was made of that person and the right was not disclosed.

Some of the more obscure interests (for example manorial rights and tithes) will retain their overriding status for only ten years after the Act comes into force and must be protected by entry on the register within that period if they are to continue to bind the registered proprietor.

Third-party rights

There is a new system for the protection of third-party rights. Cautions against dealings and inhibitions are abolished and protection in the future will be by means of a restriction or an agreed or unilateral notice. Existing cautions against dealings will remain on the register and the existing procedures will continue to apply, but it will not be possible to register new cautions against dealings. Existing inhibitions will take effect as if they were restrictions.

A person who claims an interest in land by proprietary estoppel or under an implied, constructive or resulting trust should protect that interest by means of a restriction.

Cautions against first registration

Cautions against first registration will remain but, after a transitional period of two years, it will no longer be possible to register a caution against first registration of the cautioner’s own land. The correct form of protection will be substantive registration. Any caution against first registration of the cautioner’s own land lodged during the two-year transitional period will automatically come to an end after the transitional period has expired. Cautions against first registration of the cautioner’s own land, which were registered prior to 13 October 2003, are not affected by these provisions.

For the first time, a landowner will be able to apply for cancellation of a caution against first registration registered by a third party, and it will also be possible for a new cautioner to be registered in place of an existing cautioner if the protected interest is transferred.

Adverse possession

From 13 October 2003, the provisions of the Limitation Act 1980 are disapplied to registered land and the new procedures will apply. A squatter will be able to make an initial application founded on adverse possession after a period of only ten years adverse possession. The registered proprietor and other interested parties will be notified of the application and may in certain circumstances serve a counter notice, which will lead to automatic dismissal of the squatter’s application. If the application is dismissed and the squatter remains in possession for a further two years, he may re-apply and will be registered in place of the owner unless proceedings have in the meanwhile been commenced for possession or the position has been otherwise regularised, for example, by the granting of a lease or licence to the squatter.

The owner of registered land will thus receive an “early warning” of the possibility that his or her title might be lost through an adverse-possession claim.

There are transitional provisions to cover cases where the squatter had already acquired rights under the Limitation Act 1980 before the Act comes into force.

Freedom of information

The principles relating to the inspection and supply of copy documents have been widened to reflect the Freedom of Information Act 2000. All documents (and this includes application forms and correspondence) lodged at the Registry on or after 13 October 2003 will be freely available, subject to certain exceptions provided for in the Rules. Documents, which prior to 13 October 2003 were available only at the discretion of the registrar, will retain this status for a period of two years after which they will become “open”. An application can, however, be made for any document to be exempted from the general right to inspection on the basis that the document in question contains sensitive commercial or personal information.

If a document is exempted from the general right of inspection, copies issued by Land Registry will have the sensitive information edited out. However, even after a document has been exempted, an application can still be made for a complete copy of the document. If such an application were received, Land Registry will notify the person who originally applied for the exemption giving an opportunity to object to the unedited copy being issued. If an objection were to be lodged and the matter could not be resolved between the parties by agreement, it would need to be judicially determined.

Forms

All forms, including those for inspecting registers, obtaining official copies and making searches, are revised. If no form is prescribed for an application, form AP1 must be used. The only exception to this is that an application to remove the name of a deceased, joint-registered proprietor from the register can be made by letter without the need for an AP1.

Pending applications and existing register entries

Pending applications awaiting processing in the Registry when the Act comes into force will be dealt with under the provisions of the Land Registration Act 1925. Exiting register entries will remain valid even though some of them will not be capable of registration after the Act comes in.

There are important changes on the way. This article simply highlights the main areas of impact. Further information is available from the Registry’s website, www.landregistry.gov.uk/lract2002, or from any office of Land Registry. In addition, Land Registry’s Action Line, 0870 9088 061, is a dedicated telephone helpline.

Information, including a comprehensive series of Practice Guides dealing with all areas of change, can be downloaded from the Registry’s website.

Alternatively, please contact any office of Land Registry or Ros Lovell at Land Registry York Office, James House, James Street, York YO10 3YZ, DX 61599 York (2).