Introduction

A sound register of title of any estate should be indefeasible and the purchaser of that estate need not go behind the register to investigate the origin of the title. The register should give an accurate and true representation of the title to the land and should show all encumbrances so that a person dealing with the land can discover all the facts related to the land. The current system of registration of titles of land is based on three principles which are: the curtain principle, the insurance principle and the mirror principle. The curtain principle allows some equitable interests attached to the land to be hidden from the purchaser‘s view but this does not affect the validity of transactions relating to the land. The insurance principle allows for compensation of losses incurred by a purchaser due to reliance on the integrity of the system. The most fundamental principle relating to land register is the mirror principle. This principle follows that registration of any title should reflect all the pertinent details relating to the title of the land that a purchaser ought to know before purchasing the land. The details that should be reflected by the register include the owner of the land, the type of ownership, restrictions on such ownership and any third party rights that may affect the ownership of that land.

Although the current land registration system tries to live up to the standard required by the mirror principle, there are some flaws in the system. One of the major flaws in the system is that some third party interests, especially overriding interests, affect the title of the land despite of them being unregistered in the registry. According to the mirror principle the title should reflect all the interests that affect the land and such overriding interests are not reflected in the register but nevertheless affect the title of the land. The lack of this reflection is a major flaw in the register of titles of any land. These interests that need not be registered but are overriding include short leases, some easements and the rights of persons in actual occupation of the land. These overriding interests existed in the former, LRA 1925, system but were subsequently reduced by LRA 2002.

Changes introduced by LRA 2002

The most significant changes introduced by LRA 2002 include the reduction of the length of leases that must be registered. The former requirement for registration of leases was a length of 21 years but this is reduced to 7 years in LRA 2002. Changes also include the introduction of cautions against first registration which serve to provide notifications for individuals with interest in the land being registered. The caution system existed under the previous regime but LRA 2002 makes such cautions more enforceable and prevents individuals from placing cautions on their own estates upon first registration. The changes also made it possible to investigate the title of the land at a single instance without requiring additional searches. The new law also seeks to protect the interests of third parties over any registered land. The law achieves this by simplifying the methods of protection accorded to third parties as well as extends such protection by making an entry into the register. The new law makes it possible to make applications for notices or restrictions without the consent of the registered proprietor.

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Overriding interests

Overriding interests, in respect to land, are those interests that are not included in a register of title but nevertheless affect the title. Overriding interests are binding to both the owner and any subsequent purchasers of the land. Under the LRA 2002, there are two classes of overriding interests and these are interests that are overriding upon initial registration of the land and interests that are overriding on subsequent registration of the land. The distinction between these two classes is necessary because the effect of overriding interests on first registration and subsequent registration are different. Under LRA 2002, overriding interests on first registration include leases for less than 7 years, interests of individuals in actual occupation of the land easements and miscellaneous interests for example local land charges. Leases shorter than 7 years need not be registered but they are overriding. Leases for shorter periods imply that the tenant will be in actual occupation and, therefore, easily discoverable thus making them acceptable as overriding interests. If the occupier, however, failed to disclose his or her occupation when required to, then such occupation cannot be overriding. Additionally, LRA 2002 removed protection for persons receiving profits or rent from the land.

Actual occupation

In Abbey National Building Society v Cann it was held that overriding interests can only be binding if the person claiming it was in actual occupation. Overriding interests also extend to persons whose occupation could not be discovered at the time of disposition and where there was no knowledge of the interest. In Williams & Glyn‘s Bank v Boland, the court held that an occupation under equitable interest is an overriding interest. In Paddington Building society v Mendelsohn the court of appeal held that because M knew, at the time of purchase, that PBS would have an interest on the land, she had impliedly conceded priority and therefore her interest was not overriding. In Malory Enterprises Ltd v Cheshire Homes it was held that if the land is not habitable, actual residence is not necessary but there need to be presence with some degree of continuity.

In Williams & Glyn’s Bank v Boland the position was that the bank’s action for possession of a mortgaged estate was unsuccessful because the wife’s interest was overriding as she was in actual occupation. This decision overruled earlier decisions in Caunce v Caunce and Bird v Syme Thomson. In Caunce v Caunce it was held that a wife was not in actual occupation in the matrimonial home and it was the husband alone who was in actual occupation. In Bird v Thomson the court observed that a wife cannot be said to be in actual occupation of a mortgaged matrimonial home. In contrast to these two decisions, Williams &Glyns Bank v Boland gave actual occupation a plain English interpretation. Actual occupation was defined to be a matter of fact and not of law and does not require anything else apart from physical presence. Actual occupation, therefore, does not depend on title and people can be in actual occupation either jointly or severally as held in Hodgson v Mark. In this case the court of appeal overruled a decision of the lower court and found that Mrs. Hodgson’s occupation was actual. The court noted that such occupation need not be actual and apparent. The court further noted that the assumption that she was Mr. Evans wife was irrelevant as there was no requirement that her occupation be apparent. In Hypo Mortgage Services Limited v Robinson parents sought leave to appeal against possession on grounds that their children had beneficial interests and as such they were in actual occupation. The court of appeal, in denying the leave, observed that a child cannot be in actual occupation as to give rise to an overriding interest. The court observed that children have no right of their own and are in occupation because of their parents and, therefore, their interests cannot be overriding under section 70 (1) (g).

Conclusion

Cases
Abbey National Building Society v Cann [1991] AC 56
Bird v Syme Thomson 1979 1 WRL 440
Caunce v Caunce 1969 1 WRL 268
Hodgson v Mark 1971 2 WRL 12503 COA
Hypo mortgage services limited v Robinson CA 2 Jan 1997
Malory Enterprises Ltd v Cheshire Homes [2002] EWCA Civ 151
Paddington BS v Mendelsohn [1985] EWCA Civ 17
Williams & Glyn’s Bank v Boland [1981] AC 487

Bibliography

Barnett, Katy, ‘The Mirror of Title Crack’d From Side to Side? The Amazing Half-Life of the Equitable Mortgage.’ [2007] Austl. Prop. LJ 1, 6
Bogusz, Barbara, ‘Bringing Land Registration into the Twenty–First Century–The Land Registration Act 2002’ [2002] The Modern Law Review 556, 558
Burn, Edward Hector, and John Cartwright, Cheshire and Burn’s Modern law of real property (1st, Oxford University Press, 2011) 134
November, Janet, and Julia Rendell, ‘The” Mirror” Principle and the Position of Unregistered Interests in the Torrens System’ [2010] New Zealand Law Review 151, 156
Wadhwa, D. C., ‘Guaranteeing title to land’ [2002] Economic and Political Weekly 4699, 4712

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