Investigation of title - Identifying and resolving title iss...

Learning Outcomes

This article outlines the investigation of title in registered and unregistered land, including:

• Official copies checks and core documents in an epitome of title
• Encumbrances and adverse rights (easements, covenants, rentcharges, profits, mortgages, leases, notices, restrictions) and their impact on use, value, and marketability
• Overriding interests and the circumstances in which legal easements, short leases, and rights of actual occupiers bind a buyer despite non-registration
• Classes of title (absolute, possessory, qualified, good leasehold), implications for buyers and lenders, and upgrading considerations
• Pre-completion searches to secure priority and update title (OS1/OS2 for registered land, K15 for unregistered land), bankruptcy (K16) and company searches
• Practical steps to resolve defects: requisitions, undertakings, discharge of charges (DS1, DS3, electronic discharge), rectification at HMLR, statutory modification/discharge of restrictive covenants (s.84 LPA 1925), and indemnity insurance
• Co-ownership and overreaching, Form A restrictions, occupier waivers, and differences between Land Charges searches and local land charges

SQE1 Syllabus

For SQE1, you are required to understand the investigation of title in registered and unregistered land and the identification and resolution of title issues, with a focus on the following syllabus points:

• The distinction between registered and unregistered land and the procedures for investigating title in each.
• Interpreting official copies and the title plan: Property Register, Proprietorship Register, Charges Register; classes of title and restrictions/notices.
• Epitome of title: good root of title, chain of ownership, execution/stamping, Land Charges searches and the doctrine of notice.
• Identifying encumbrances (easements, covenants, mortgages, rentcharges, profits, leases), overriding interests (Schedules 1/3 LRA 2002), and their practical implications.
• Searches and priority: OS1/OS2, K15 Land Charges, K16 bankruptcy, company searches, index map.
• Resolving defects: raising requisitions, undertakings, discharge of charges, rectification at HMLR, indemnity insurance, s.84 LPA applications.
• Advising on co-ownership, overreaching, Form A restrictions, occupier rights, and lender requirements.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

1. What is a "good root of title" in the context of unregistered land, and why is it important?
2. Which register in the official copies will reveal restrictive covenants affecting a registered property?
3. What is an overriding interest, and give one example that could affect a buyer?
4. If a restrictive covenant is discovered that would prevent a buyer’s intended use, what are two possible ways to resolve this issue?

Introduction

When acting for a buyer, the core objective is to ensure the seller can lawfully transfer the estate being sold and that the buyer will acquire a good and marketable title free of unacceptable risks. The process differs for registered and unregistered land, and your investigation must be thorough: read title carefully, raise targeted requisitions, and use searches and inspections to uncover interests not apparent on paper. Always consider the lender’s position: defects that compromise marketability or security can jeopardise the advance. In registered land, remember that legal title to the buyer does not pass until the disposition is completed by registration; in unregistered land, title passes on completion but an FR1 for first registration must be lodged within the statutory period.

Investigating Title: Registered and Unregistered Land

Registered Land

Most land is now registered. The seller’s solicitor should provide official copies of the register and the filed title plan, plus any documents referred to on the registers and filed at HM Land Registry (HMLR). Check each part systematically.

• The Property Register confirms the legal estate (freehold/leasehold), descriptive details, and rights that benefit the land (e.g., rights of way; rights to use services).
• The Proprietorship Register identifies the registered proprietor(s), the address(es) for service, the class of title, price paid (if after 01/04/2000), and any restrictions affecting the ability to register dealings (e.g., Form A).
• The Charges Register sets out adverse matters burdening the land: mortgages/charges, restrictive covenants, easements over the land, leases, and notices.

Key Term: official copies
Certified copies of the register of title and the filed title plan. They are admissible evidence of the register entries and should be no more than six months old when used to deduce title.

Key Term: property register
The part of the register describing the estate (freehold/leasehold), the property, and rights that benefit it, often cross-referencing the filed title plan.

Key Term: proprietorship register
The section showing the registered proprietor(s), class of title, and restrictions affecting dispositions, such as Form A for co-owned land.

Key Term: charges register
The section listing encumbrances that burden the land, including mortgages, covenants, easements, leases, and notices.

Key Term: title plan
The filed plan referenced in the Property Register. It shows the general boundary extent (edged in red) and may colour/hatch areas relevant to rights or burdens.

Key Term: search from date
The date and time printed on the official copies stating when the entries were last confirmed. Use it as the “search from” reference in your OS1/OS2 priority search.

Key Term: class of title
The HMLR quality grading of the registered estate, commonly absolute (best), possessory (based on possession or lost deeds), qualified (subject to a specified defect), and good leasehold (HMLR has not investigated the reversionary title).

Key Term: restriction (Form A)
A standard restriction noting that no disposition by a sole proprietor under which capital money arises is to be registered unless authorised by court order. It flags co-ownership and the need for overreaching on sale.

Review the official copies against the contract and any occupier information in the Property Information Form. If the Charges Register refers to covenants or rights “set out in full” or by reference to a filed deed, obtain official copies of those deeds (OC2) and read the operative clauses, schedules, and plans. Confirm that entries align with the buyer’s intended use and the lender’s requirements.

Unregistered Land

In unregistered title, the seller deduces title by supplying an epitome of title (a list with copies of relevant deeds). Your task is to verify the good root, confirm an unbroken chain of ownership, and assess interests.

• Select a good root (typically a conveyance or legal mortgage at least 15 years old) that deals with the whole legal and equitable interest, adequately describes the property, and does not cast doubt on title.
• Confirm an unbroken chain from the good root to the seller and reconcile names, dates, and descriptions across all deeds.
• Check execution formalities appropriate to the deed date and stamping/PD stamp/ad valorem stamp or certificate of value (older deeds) to ensure admissibility in civil proceedings.
• Follow cross-references for rights/reservations and annexed plans; include pre-root deeds only if referred to and necessary for covenants/easements/description.

Key Term: epitome of title
A chronological list of title deeds with copies attached, starting from the root of title and including any earlier documents cross-referred to for covenants, easements, or plans.

Key Term: good root of title
A document at least 15 years old that deals with the whole legal and equitable interest in the land, contains a sufficient description, and reveals no defect casting doubt on title.

Conduct Land Charges searches against each estate owner’s name since 1926 for their period of ownership (including variations of names and historic counties). Remember that registration as a land charge constitutes actual notice to all the world; failure to register a registrable equitable interest can render it void against a purchaser for value.

Key Term: K15 Land Charges search
A pre-completion search in unregistered land against the seller’s name(s) to update entries and secure a 15-working-day priority period for completion.

Key Term: index map search
A SIM search at HMLR to verify whether land (or mineral rights) is registered and whether any cautions or pending applications affect it.

Identifying Title Issues

Encumbrances and Adverse Rights

Identify burdens and third-party rights that may hinder use or affect value:

• Easements (rights of way; rights to lay and use services; rights of support; rights to light/air if created by covenant).
• Restrictive covenants (e.g., single-dwelling use, no business use, building lines).
• Positive covenants (e.g., fencing obligations, contributions to private road maintenance). Note: they do not run with freehold land, but chains of indemnity covenants can bind successors indirectly.
• Mortgages/charges, including puisne mortgages in unregistered land (Class C(i) land charge).
• Rentcharges and rights of entry (estate rentcharges can secure positive obligations).
• Leases or tenancies; assess term, use, landlord’s rights, and whether they override.
• Notices and restrictions, including home rights notices and agreed/unilateral notices to protect interests.

Key Term: encumbrance
Any right or interest in land held by a third party that burdens the owner’s use or ability to dispose of the land, such as covenants, easements, leases, and charges.

Key Term: notice (agreed/unilateral)
Entries in registered land to protect interests affecting the estate; an agreed notice is entered with the proprietor’s consent or evidence, a unilateral notice without consent (subject to cancellation unless defended).

Overriding Interests

Some interests bind a purchaser despite not being entered on the register.

• Legal leases not exceeding seven years override registered dispositions (Schedule 3 LRA 2002).
• Rights of persons in actual occupation can override if occupation is obvious on reasonably careful inspection or known to the buyer; exceptions apply where the buyer made enquiries and the occupier didn’t disclose, or occupation was not obvious.
• Certain legal easements and profits can override if implied/prescriptive (not express by deed) and either known, obvious on inspection, registered under commons legislation, or recently exercised.

Key Term: overriding interest
An interest binding a purchaser of registered land despite non-registration, including short legal leases, some legal easements/profits, and rights of persons in actual occupation.

Check for occupiers and physical evidence of rights on inspection (tracks, pipes, gates, cables). Use pre-contract searches to pick up local land charges (which override), planning constraints, and highways adoption status. Distinguish local land charges (LLC1) from Land Charges (Plymouth registry) for unregistered title.

Defects in Title

Common defects include:

• Breaks in the chain of ownership or missing deeds (e.g., loss of a conveyance).
• Unstamped or insufficiently stamped deeds (older documents) or defective execution.
• Unresolved mortgages or charges; absent evidence of discharge.
• Unknown or unregistered covenants/easements referred to but not supplied.
• Discrepancies in the property description or plan; unclear boundaries.
• Classes of title concerns: possessory title risks pre-first-registration adverse claims; good leasehold title signals HMLR has not approved the freehold reversion.
• Co-ownership issues (e.g., Form A restriction) requiring overreaching on sale by two trustees or a trust corporation.
• Powers of attorney and capacity problems; transactions at undervalue with insolvency risk.

Resolving Title Issues

Practical Steps

• Raise targeted requisitions on title to clarify entries and resolve gaps (e.g., request copies of referenced deeds, explain missing documents, confirm use compliance).
• Obtain evidence: certified copy deeds, statutory declarations (e.g., lost deed; long user for prescriptive rights), death certificates, grants of representation, powers of attorney.
• Seek undertakings for discharge of charges and removal of entries; confirm lender redemption figures and daily interest.
• Secure priority and update title with pre-completion searches: OS1/OS2 for registered land; K15 for unregistered land; include lender’s name on OS searches to protect the mortgage.
• Verify bankruptcy (K16) and company solvency; check floating charges have not crystallised; confirm the company’s power to borrow.

Key Term: requisition on title
A formal question raised to resolve a specific issue identified during title investigation, usually before exchange.

Key Term: OS1/OS2 priority search
HMLR searches for registered land providing a 30-working-day priority period for the buyer (OS1 for whole, OS2 for part). Submitting in the lender’s name protects the charge as well as the transfer.

Key Term: bankruptcy-only search (K16)
A Land Charges search against an individual borrower to reveal bankruptcy proceedings or orders, often required by lenders.

Key Term: company search
A check of the seller/buyer company’s status, insolvency proceedings, and existing fixed/floating charges, often needed to protect lender security and ensure the seller can complete.

Key Term: DS1
HMLR form confirming discharge of a charge over the whole registered title; may be lodged electronically (ED) by lenders.

Key Term: DS3
HMLR form evidencing discharge of a charge over part of a registered title; must include a plan showing the released part.

Key Term: receipted charge
In unregistered land, the original mortgage deed endorsed with a vacating receipt to evidence discharge.

Remedies for Defects

• Negotiation: seek consent, release, or deed of variation from the beneficiary of a covenant/easement; obtain lender consent or waiver where needed.
• Indemnity insurance: for specific risks (e.g., breach of covenant, lack of rights of way, missing deeds, building regulations/planning issues). Avoid prejudicing cover by contacting the beneficiary or authority unless the insurer agrees.
• Statutory remedies: apply to the Upper Tribunal (Lands Chamber) under s.84 Law of Property Act 1925 to discharge or modify restrictive covenants (e.g., obsolete or impeding reasonable use).
• Rectification/correction: request HMLR to correct a mistake or update entries; support with evidence (title documents, declarations). For class of title concerns, consider upgrading in due course.
• Co-ownership: ensure overreaching by payment to two trustees or a trust corporation; address Form A restrictions; if selling by a sole survivor of tenants in common, appoint a second trustee.

Key Term: indemnity insurance
A policy protecting against loss from a specific title defect where legal resolution is uncertain or impractical (e.g., missing deed, breach of covenant). Coverage terms vary and may prohibit contact with beneficiaries.

Key Term: title guarantee
Implied covenants under the Law of Property (Miscellaneous Provisions) Act 1994. Full title guarantee includes a covenant to dispose and to do all reasonable acts to transfer, and freedom from incumbrances except those unknown and not reasonably discoverable; limited title guarantee narrows the freedom from incumbrances to those created since the last disposition for value.

Worked Example 1.1

A buyer’s solicitor discovers a restrictive covenant in the charges register prohibiting business use, but the buyer intends to run a home office. What should the solicitor do?

Answer:
The solicitor should first check if the covenant is enforceable and who has the benefit. If the covenant is recent and the beneficiary can be identified, the solicitor can approach them for consent or a release. If the beneficiary cannot be found, or consent is unlikely, the solicitor should consider restrictive covenant indemnity insurance to protect the buyer.

Worked Example 1.2

During investigation of unregistered title, a deed is missing from the chain. The seller cannot produce it. What are the options?

Answer:
The solicitor should ask the seller to obtain a certified copy or statutory declaration explaining the loss. If this is not possible, indemnity insurance may be appropriate to protect the buyer and lender against any risk arising from the missing deed.

Worked Example 1.3

The official copies reveal a mortgage in the charges register. What must the buyer’s solicitor do before completion?

Answer:
The solicitor must obtain an undertaking from the seller’s solicitor to redeem the mortgage out of the sale proceeds and provide evidence of discharge (e.g., DS1 form or electronic discharge) after completion.

Worked Example 1.4

You act on a registered title purchase with a mortgage. Should the OS1 priority search be lodged in the buyer’s or the lender’s name?

Answer:
Lodge the OS1 in the lender’s name to protect both the transfer and the mortgage. An OS search in the buyer’s name does not secure priority for the lender’s charge, risking loss of priority if a competing entry is made before registration.

Worked Example 1.5

In an unregistered title, the root is a 1980 conveyance to A. The conveyance references covenants in a 1974 deed from B to A. Which Land Charges searches are needed?

Answer:
Search against A from 1980 to the present; against B from 1974 to 1980; and if earlier owners are unknown, search against the 1974 seller(s) from 1926 to 1974. Include all name variants and the correct historic county designations to ensure coverage.

Worked Example 1.6

A registered title shows a Form A restriction and one registered proprietor wishes to sell. What must be done to ensure overreaching?

Answer:
Appoint a second trustee (or use a trust corporation) so that capital money is paid to two trustees, overreaching beneficial interests. The transfer can then be registered and the Form A restriction will be satisfied on registration.

Exam Warning

Contacting the person with the benefit of a covenant (or a party who might enforce an undocumented right) before arranging indemnity insurance may invalidate cover. Always check the insurer’s requirements first.

Revision Tip

Distinguish Land Charges (Plymouth) from local land charges (LLC1). Land Charges protect equitable interests in unregistered land by registration against names; local land charges protect statutory burdens and planning designations and are overriding in registered land.

Summary

Key Point Checklist

This article has covered the following key knowledge points:

• Investigate title comprehensively: for registered land, read official copies and filed documents; for unregistered, verify the good root, chain of title, execution/stamping, and Land Charges.
• Understand Property/Proprietorship/Charges Registers, title plan, search from date, classes of title, and restrictions/notices.
• Identify encumbrances (easements, covenants, rentcharges, profits, mortgages, leases), and recognise when interests override despite non-registration.
• Use OS1/OS2 and K15 searches to secure priority and update title; run K16 bankruptcy and company searches where relevant.
• Resolve defects with requisitions, undertakings, DS1/DS3/ED discharges, statutory declarations, indemnity insurance, rectification, and s.84 LPA applications.
• Advise on co-ownership, overreaching, Form A restrictions, and occupier rights; ensure lender requirements are satisfied.
• Report clearly to the client and lender on any unresolved risks and the implications for use, value, and marketability.

Key Terms and Concepts

• official copies
• property register
• proprietorship register
• charges register
• title plan
• search from date
• class of title
• restriction (Form A)
• notice (agreed/unilateral)
• epitome of title
• good root of title
• encumbrance
• overriding interest
• requisition on title
• OS1/OS2 priority search
• K15 Land Charges search
• bankruptcy-only search (K16)
• company search
• index map search
• DS1
• DS3
• receipted charge
• indemnity insurance
• title guarantee