Knowing Your Title

20/11/2017

The legal status in terms of ownership of a building or plot of land are critically important as a first step in assessing development potential.

Title Deeds are legal documents that record the details of ownership and any rights over a property in the UK. The documents detail the ownership status and any legal restrictions that may affect the status of a property. The title deeds for properties in England and Wales are held at Her Majesty’s Land Registry.

This blog provides a brief overview of what title deeds are, where to find them and what to look for and understand from the legal jargon which these documents inevitably employ.

The UK Land Registry

THE HM Land Registry was set up in 1862 and records the ownership rights of freehold properties and leasehold properties where the lease has been granted for a term exceeding seven years.

Today the title deeds documents can be easily accessed and retrieved online and are available to anyone who registers with the land registry website.

https://www.gov.uk/government/organisations/land-registry

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Leasehold, Freehold or Commonhold

If a property is classified as freehold it means that the building is owned outright and in perpetuity. The owner’s name is identified on the title deeds as the Freeholder and Owner of the ‘Title Absolute’.

A freeholder is usually responsible for maintaining the common parts of a building such as the public areas and external walls and roof.   They are usually responsible for the Buildings Insurance but individual freeholder responsibilities may need to be determined and or clarified.

If a property is classified as leasehold this means that there is a lease in place that has been granted by the freeholder.  It is the temporary nature of leaseholds that sets leaseholds apart from freeholds.

The lease is a contract between a freeholder and a leaseholder that provides a temporary right to occupy land or property for a small annual fee.

For residential properties the contracts are often 90 or 100 years but there are many properties, particularly in London, with 999 year leases.

For commercial properties the specified lease period is anything from 5 to 25 years but with a number of rights to terminate the agreement on either side, usually denoted in the contract by a break clause.  Commercial leases are governed by the Landlord and Tennant Act 1954.

A third and increasingly more common form of ownership is called Commonhold. This occurs when a multi-occupancy building is divided into a number of freehold units, so each individual dwelling owns its own freehold.

The common parts of the building are owned by a management company which each dwelling within the building will own a share of, the size of which is proportional to the floor area of the dwelling against the overall area of the building.

The Title Deeds contain records of freeholds and leasehold contracts that may be in place and are submitted to the UK Land Registry by the conveyancing solicitor at the time of purchase or amendment(s) to a title.

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Covenants, Easements and Wayleaves

The key things to look for are restrictions on a development that are imposed by agreement and highlighted within the title deeds.

Covenants

Covenants are usually included in the titles by the previous owners of the title and are binding to all future owners.  Some covenants are very old and can be bizarre in nature, some can be recent and have been executed by a previous owner.

Covenants can only be removed or ‘extinguished’ by agreement, a process that requires an application and a fee payment to the Lands Tribunal.  The Lands Tribunal is a civil court with jurisdiction over land and property, relating to title obligations, Right to Buy, compulsory purchase and other private rights.  This is the authority that can enable modifications to title deeds to be made.

The most common form of covenant that architects encounter is when a former owner, at the time of sale, imposes a restriction on the right of any future owner to create a development that includes, e.g. windows overlooking neighbouring properties.  It may also impose height restrictions on any part of a future development.

Covenants can be an obstacle to overcome but they do not necessarily prevent a development from taking place as they can be removed.  In complex covenant scenarios there are insurance policies available which will provide a developer the cover required against a covenant being enforced.

Easements

As with covenants, easements are recorded in the title deeds.  An easement is generally concerned with ‘rights of way’ and may grant rights to an adjoining owner (including utility companies) for access across parts or all of a piece of land.

Rights of way and other easements may be obtained through a history of usage, this is known as a ‘Prescriptive Easement’.

Applications for a Prescriptive Easement, i.e. if a right of way has been enjoyed for a specific amount of time, can be obtained by applying to the Land Registry.

There are exemptions to certain rights, in cases involving National Rail routes, Waterways or Crown Land.  These applications must be endorsed by the relevant Authority via a Statutory Declaration.

Redundant or out-dated easements can be removed by application to the Lands Tribunal.

Wayleaves

Wayleaves grant rights for utilities and services to pass over or under a piece of land or property and can be time limited or given in perpetuity.  They are generally granted in favour of statutory undertakers, the providers of utilities, e.g. Water, Gas or Electricity.  Wayleaves are normally identified within the Title Deeds.

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Specialist Advice

As architects it is important to have an understanding of what the Titles to a property are and the implications of their content.  We always check the content of title deeds with our legal partners, Teacher Stern Solicitors, who are experts in legislation and conveyancing.

Our contact there is Dov Katz d.katz@teacherstern.com