Possessory Title

If land is unregistered at Land Registry and the paper title deeds cannot be located it is possible to apply to Land Registry for a claim for Adverse Possession.

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As there are no Title Deeds a Statement would need to be provided showing how the applicant’s claim arises and providing such documentary evidence as is available to support such claim.

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Usually an applicant’s claim can be proved by the length of time the party can show they have lived at the Property. Land Registry will consider the application and if the claim is proved will offer a title based on Possessory Title.

There are 3 classes of title available to registered land whether it is a freehold or leasehold title:

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Absolute Title

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This provides that  title to the estate is such that a competent professional could advise a willing buyer it is acceptable.  Where the title is leasehold the Land Registry also approves the Lessor’s title and therefore it’s ability to enable the grant of the lease

Possessory Title

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This title may be granted where Land Registry considers the applicant is in possession of the land or is in receipt of rents and profits and there is no other class of title which it is appropriate to offer.  In practice this means that the title deeds have been lost or damaged.

Qualified Title

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In practice this is quite rare.  However, if Land Registry are of the opinion that the title has only been established for a limited period or is subject to certain reservations which cannot be disregarded a qualified title may be offered.  

For example, where the title has been submitted for first registration but a transaction within the title has been carried out in breach of trust.  In this event the applicant would be granted title subject to the interests of any of the beneficiaries under the trust and the title qualified to reflect this.

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If a possessory title is granted a buyers’ Solicitor may raise further queries such as requesting that the title be upgraded or that insurance be put in place.

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In order to upgrade the title, the applicant needs to be the registered proprietor and have held a possessory title for more than 12 years, or where the title deeds have come to light proving the ownership of the registered proprietor.

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The main problem with a possessory title is that most Lender’s will not accept this for lending purposes unless there is some form of insurance in place.

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The second query that will be asked by any buyer’s solicitor, is whether there is a policy of insurance in place indemnifying the owner, or any successor in title against the risk that the paper owner may make a claim which defeats the registered proprietor’s ownership.  For example, if the deeds were to materialise and they contain a sale off of part of the land to someone else which had not been known about this would mean the registered proprietor could no longer claim ownership of the whole of the land.

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There are specialised insurance companies who provide legal indemnity insurance against risks such as these and it would always be advisable once a possessory title is obtained to fund an insurance policy to protect the owner from such risk. There will be several conditions to obtaining such a policy which in general are:

The missing documents are dated at least 10 years prior to the commencement of any policy where the particulars of such documents are known
There has been no physical evidence of any rights or easements through the property for at least the 12 months immediately prior to the commencement of the policy
The property has been registered at Land Registry for at least 12 months
Any structures on the property have existed and remained unaltered for at least the last 12 months
The current use of the property has been continuous and unchanged for the last 12 months
There are no proposals to develop, redevelop or change the use of the property
That the owner is not aware of any communications relating to the missing documents with any party who has the benefit of any adverse interest or knows of any objection, challenge or dispute relating to the use of the property or any covenant or right affecting title to the property