Background

The deduction and investigation of title to land has changed completely over the last 20 years or so. Previously, title was mainly unregistered, and was not deduced by the buyer to the seller until after contracts had been exchanged. The buyer would then check the title (which, if unregistered, would comprise a thick package of copy documents or an “abstract” of those documents, some of which would frequently be hand-written or, if registered, would comprise office copies of the register entries, which had to be obtained by the seller, since the registers of title at H.M. Land Registry could only be searched by the registered proprietor or a person authorised by him) and raise formal requisitions on title, which the seller would answer. If a satisfactory reply could not be given to a requisition, the buyer might find himself unable to proceed with his purchase, which was highly unsatisfactory to both buyer and seller.

Now, however, many solicitors never come across an unregistered title, and the whole of the country is subject to compulsory registration on completion of a sale or any of the other specified triggers. It is standard practice (and compulsory, where the Protocol applies) for title to be deduced at the outset (although this is not apparent from the standard forms of conditions of sale - see also SCPC 6.3), at the same time as searches are being made and enquiries raised, and for the buyer to satisfy himself that the title is satisfactory prior to exchange of contracts, subject only to anything adverse which may be revealed by pre-completion searches. Indeed, it is usual for the contract to prohibit any objection to or requisition on title after exchange of contracts, unless this arises from a matter revealed by a pre-completion search. Deducing title is normally a simple matter of obtaining a copy of the entries on the registers of title maintained at the Land Registry, and if these are not forthcoming from the seller, they can easily be obtained by the buyer, as the registers of title are open to inspection by anyone.

Registered Title – Deduction of Title

Where the property is registered at the Land Registry, the seller will normally deduce title to the buyer by providing official copy entries of the registers (i.e. the Property Register, the Proprietorship Register and the Charges Register) maintained at the Land Registry in relation to the property, together with either the filed plan for the property or a Certificate in Form C1 (which certifies which colour references on the registers of title affect the property), and copies of any documents referred to in the Register entries which relate to the property . Where the property is leasehold, a copy of the lease should also be provided.

There is no obligation to provide such items by way of deduction of title, however, as no rules have been made under Schedule 10, Paragraph 2 of the Land Registration Act 2002 as to how evidence of title is to be deduced, and the parties may agree, for example, that it is for the buyer to obtain official copies. Both the Standard Conditions of Sale and the Standard Commercial Property Conditions of Sale, though, require the seller to provide official copies of the register entries to the buyer, as does the Protocol.

Registered Title – Investigation of Title

The buyer’s solicitor will review the title deduced to him, and will check, in particular:

• that the property is correctly described in the Property Register, and is correctly shown on the filed plan (if provided);
• (if there is a lease) that the details of the lease as set out in the Property Register accord with those in the contract and/or with the copy lease supplied by the seller and that no deeds of variation or other supplemental documents are referred to on the Register but are not referred to in the contract (or, if such documents are noted on the Register, the buyer has received a copy of them);
• any other entries in the Property Register, which may include rights benefiting the property, party wall declarations, and similar matters;
• the class of title (generally, the buyer will require absolute title, the best quality of registered title available, although where title is merely qualified, possessory or good leasehold, insurance may be available or the buyer may, in some circumstances, be prepared to accept a lesser quality of title, if that is all that is available);
• that the seller is the sole proprietor of the property (if the seller is one of joint registered proprietors, then the other joint proprietor will need to join in the contract as seller; if the registered proprietor is somebody other than the seller, then the buyer will need to be satisfied that the seller can in fact sell the property (for example, that he has taken a transfer of the property from the registered proprietor, or a transfer on first registration from the previous owner, and that transfer is in the course of registration at the Land Registry));
• that there are no restrictions, nor any cautions or inhibitions registered before the Land Registration Act 2002 came into force, noted in the Proprietorship Register (or, if there are, these will be removed at or prior to completion);
• any entries in the Charges Register, such as mortgages, notices, restrictive covenants, easements and other matters which the property is subject to (in the case of a mortgage, the contract should provide for this to be removed on or prior to completion; in the case of any other entry, the buyer will need to consider the effect of this, the availability of insurance cover (in some cases) and whether he is prepared to buy the property at the agreed price and on the agreed terms subject to the entry);
• any entries on the title which the buyer will be required, pursuant to the contract, to indemnify the seller against, and any indemnity covenants or other personal covenants given by the seller on completion of his purchase.

Unregistered Title – Deduction of Title

Where the property is not registered at the Land Registry, the seller will normally deduce title to the buyer by providing an epitome of title. This will consist of a front sheet listing, in date order, the copy documents provided, together with photocopies of conveyances and other title transfer documents (such as assents, grants of probate, etc.), starting with a good root of title (normally a conveyance on sale) at least 15 years old, and showing the movement of the title from the owner at least 15 years earlier, through any intermediate owners, to the seller. Other relevant documents, such as mortgages, deeds of grant of easements, etc., will also be included, together with copies of any documents which pre-date the root of title but which are referred to (without full details being given) in the root or in subsequent documents (such as documents containing details of old restrictive covenants) and Land Charges Act searches against the names of previous owners. It is possible for the seller to provide an abstract of title, rather than an epitome, which means that extracts from the relevant documents will be provided, rather than photocopies of the documents themselves, although the speed and convenience of just photocopying the documents has meant that abstracts of title are almost never seen nowadays.

Unregistered Title – Investigation of Title

The buyer’s solicitor will review the title deduced to him, which is a considerably more onerous task than in the case of a registered title, and will check, in particular:

• that a conveyance on sale, or another good root of title, has been provided;
• that the epitome of title shows a complete chain of title, from the owner at least 15 years earlier, up to and including the seller;
• that the seller is the sole owner of the property pursuant to the last document in the chain of title (if this document shows the seller acquiring the property jointly with another person or persons, then unless there is evidence of the death of that person or persons, he/they will need to join in the contract as seller);
• any memoranda endorsed on the documents (relating to sales off and other relevant transactions);
• that the correct amount of Stamp Duty has been paid on each document in the chain of title and, if appropriate, that a “Particulars Delivered” stamp has been endorsed on each of these documents;
• that any mortgages have been repaid and released;
• where there have been sales of part, that an acknowledgement for production of documents relating to the whole title have been given;
• any provisions contained in each of the documents in the epitome, in particular restrictive covenants, rights benefiting the property, rights burdening the property;
• any plans attached to the documents in the chain of title, that they show the property correctly (or include the property, where there are sales of part);
• that no transaction has been carried out since the area within which the property is situated became one of compulsory registration which would have required the property to be registered at the Land Registry (if such a transaction has been carried out, the seller should be required to register his title prior to completion).

At completion, the buyer’s solicitor (or the seller’s solicitor, if appointed as the agent of the buyer’s solicitor for this purpose,) will check each document in the epitome (or abstract) of title against the original of that document. On a sale of part, where the original documents of title will be retained by the seller, the solicitor will then mark each document in the epitome (or the summary of that document in the abstract) as having been examined against the original, adding the date and the name of the firm doing the examining. An examined abstract, or an epitome of title which has been examined against the originals, then itself becomes an original document of title, so that an epitome of title may incorporate a copy of a previously examined abstract or epitome of title.

Dealing with problems revealed by investigation of title

Any problems (or missing items) revealed by the buyer’s investigation of title will be raised by the buyer with the seller by way of requisitions on title or additional enquiries before contract (where the investigations are carried out prior to exchange of contracts). Clearly the buyer will need to be satisfied on all these points, and any changes that may be required to the contract will need to be agreed before contracts can be exchanged; where, however, contracts are exchanged before title is deduced, the seller will need to be extremely careful to ensure that there are no technical difficulties with his title, and that any such are properly reflected in the contract. For this reason, it is preferable from the seller’s point of view (as well as the buyer’s) for title to be deduced and investigated before exchange of contracts.

Title matters between exchange and completion

Provided that title has been deduced and fully investigated prior to exchange of contracts, as will normally be the case nowadays, the only title matters requiring to be dealt with after exchange of contracts are pre-completion searches and, in the case of unregistered land, the checking of the original deeds against the photocopies (or abstract) provided. Where, however, title was not deduced and investigated before exchange, the seller will deduce title on (or immediately after) exchange and the buyer will then investigate the title, raising requisitions in relation to any matters that are not clear or not satisfactory, in the same way as would have been done prior to exchange (but without the ability to alter the contract where necessary to reflect matters revealed by investigation of the title).