UK: "To What Extent?" – Heading Off Title Extent Difficulties Before Doing The Deal

Last Updated: 10 October 2019
Article by Gill Middleton and Paul Haniford

In Scotland, we are in a period of transition between two systems of registration of title to land and buildings, and have been so for the last 40 years. The first system is the old General Register of Sasines, which has been in existence since the 1600s. This consists of hard-copy title deeds, where properties are predominantly described by words only, or by a combination of words and drawings or plans of varying quality, accuracy and scale. The second is the newer, digital Land Register where properties are identified by reference to the Ordnance Survey map.

The Keeper of the Registers of Scotland has a current target to "complete" the Land Register by 2024. The aspiration is that, on completion of the Land Register, it will be possible to consult an online map of Scotland and pinpoint at the touch of a button exactly who owns every piece of land.

Transition to Land Register

Practically, this means transitioning all remaining Sasine titles onto the map-based Land Register. The process of transferring a property into the Land Register is known as "first registration" and it can happen when a property which is still in the Sasine Register is (a) transferred to a new owner, (b) charged (perhaps in connection with a refinancing of the property) or (c) in certain cases, leased. If your title undergoes first registration because of one of these events, you and your solicitor would be involved (to an extent) in that process by checking that the extent of the property shown in the title deeds is replicated accurately on an Ordnance Survey-based map suitable for land registration, and potentially by providing relevant information to Registers of Scotland about the extent of the property occupied and the way the property is accessed and serviced.

However, Registers of Scotland have also been given their own powers to transfer Sasine titles into the Land Register without the owner having taken any of the above steps. This is called Keeper Induced Registration (KIR) and allows Registers of Scotland to effect first registration of a Sasine title without any action or involvement of the owner. The danger with KIR is that Registers of Scotland do not receive information from the property owner and so tend not to have actual knowledge of the property itself in order to recognise issues with title extent, etc. Land registered titles produced through KIR therefore have a higher chance of being inaccurate and problematic.

The 2024 target is ambitious and the reality is that in March 2019 whilst 68.7% of individual titles were already in the Land Register, that represented only one-third of the actual land mass of Scotland. There are therefore many first registrations still to be done. And first registrations can present difficulties, which in some cases might cause a delay in your transaction.

Potential complications

Sometimes there is difficulty in translating the Sasine title deeds onto the Land Register.

It can be tricky to marry an unwieldy verbal description from as far back as the 1600s with the current features of the Ordnance Survey map. This can be for a number of reasons. There may be no reference in the Sasine titles to a plan or, if there is, the plan may not be of sufficiently good quality to allow identification on the modern Ordnance Survey map. It could be that the features of the land have changed over time, such that the historic and current extents cannot be reconciled – we see this often when new roads or buildings have been constructed or replaced. Or, in the most unfortunate scenario, it could be that some of the land has been erroneously transferred to someone else or that someone has started occupying land outwith their title due to boundary features being in the wrong place.

Title problems are not exclusive to titles which are still in the Sasine Register, although it tends to be more obvious when there is a problem with a title in the Land Register because the discrepancy is flagged by reference to the Ordnance Survey map. For a variety of reasons, land registered titles can also be inaccurate or insufficient. They can conflict with underlying Sasine title deeds (perhaps because there are competing Sasine title deeds), other land registered titles and physical occupation by third parties.

The result can be that the title extent of a property is different to what the owner thought it was. This can be a real problem if an owner has already negotiated to sell, lease or finance the property, and the purchaser, tenant or funder is expecting a differing extent. In the worst case scenario, a property "owner" could find themselves in a "ransom strip" situation, where a third party who happens to have a right over land that the "owner" thought they owned, can name their price to allow the transaction to complete.

Potential solutions

No one wants to encounter a title extent discrepancy at any time, but it can be a particularly nasty surprise in the middle of a deal.

There are solutions which can be explored for shortfalls, overlaps and other title extent discrepancies. It may, for example, be possible to have an overlapping title rectified by Registers of Scotland. Or the property owner might be able to negotiate the purchase of any shortfall area in advance of a sale. One other solution might be to obtain title indemnity insurance.

The best solution will depend on the circumstances of each individual case. However, each solution will take time to devise and might require negotiation. It is therefore advisable to consult your solicitor to check over your title deeds as soon as possible if you are contemplating a sale, lease or finance/refinance, preferably even before agreeing your deal.

What can we do for you?

We can carry out an initial title review on your behalf, to identify any potential title problems in advance of a transaction, and we can help you explore and identify the best option to resolve them.

If your property is in the Sasine Register, we can assist you with applying for voluntary registration of your title in the Land Register. This involves submitting your old Sasine title deeds to Registers of Scotland without any transfer of ownership taking place, which will trigger first registration in advance of your deal. When an application for registration is made, the submitting solicitor must certify to Registers of Scotland that the application is correct. With voluntary registration, purchasers are often comforted by the fact that the seller's solicitor has examined the title and certified it to Registers of Scotland, and selling a good and complete land registered property is generally quicker and more straightforward than selling a problematic Sasine one. It also ensures that you are in control of the first registration process, and avoids the possibility of KIR.

Remember – forewarned is forearmed! Stay ahead of the curve. Get in touch to see how we can assist.

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries. www.dentons.com.

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