BRIEFING PAPER Number 8567, 16 May 2019

Tracing ownership of By Lorraine Conway

property or land

Contents: 1. Land ownership 2. Registered and unregistered land 3. Who owns that property or piece of land?

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Contents

Summary 3 1. Land ownership 4 1.1 Relevant legislation 4 1.2 Crown land 4 1.3 Estates in land 4 1.4 Types of legal ownership 4 2. Registered and unregistered land 6 2.1 Recording land ownership 6 2.2 Law Commission recommendations to update land registration 7 2.3 Registered land, what does it mean? 7 2.4 Unregistered land, what does it mean? 8 3. Who owns that property or piece of land? 9 3.1 First step: searching the Land Registry 9 3.2 Second step: local investigation 9 3.3 Third step: bona Vacantia property & 10

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3 Commons Library Briefing, 16 May 2019

Summary

Constituents often ask their Members of Parliament, “who owns that empty property or piece of land?” Although a simple question, it is not straightforward to answer. Property in England and Wales can be either registered or unregistered and the steps involved in tracing ownership will vary accordingly. Any member of the public can search online the Land Registry (a fee is payable), information is available from the GOV.UK website. The Library cannot undertake Land Registry searches on behalf of constituents. If the property or land is registered, then a Land Registry search should reveal the owner(s) name. If the property is unregistered, then matters become more difficult. Lack of registration does not mean that a piece of land is not owned but ascertaining who owns the land may involve some investigatory work. Owners of unregistered land will have a bundle of paper deeds, which form a record of previous sales, mortgages and other dealings with the land. In cases where there is no legal owner, the property may have become bona vacantia and have reverted to the Crown. This Commons briefing paper provides information on how to trace ownership of a property or piece of land (section 3), in the process it also provides a summary of land ownership (section 1) and what is meant by registered and unregistered land (section 2). This briefing paper is concerned with England and Wales only; Scotland has its own land law. Northern Ireland and Scotland also have their own land registries.

4 Tracing ownership of a property or land

1. Land ownership 1.1 Relevant legislation

• Land Registration Act 1925 (LRA 1925) • Land Registration Act 2002 (LRA 2002) • Land Registration Rules 2003 (LRR 2003) 1.2 Crown land Land ownership in England and Wales is based on historical feudal principles. The Crown owns all land in England and Wales; people own estates in land either directly or indirectly from the Crown (for example, a freehold estate or a ). There are different categories of Crown land. For detailed information, see Part XI of the Law Commission’s report on “Land Registration for the Twenty-First Century: A Conveyancing Revolution.”

1.3 Estates in land Major changes to property law in England and Wales were made in 1925, for example the , which reduced the number of estates in land capable of being created or conveyed at law to an estate in absolute in possession (the freehold estate) and a term of years absolute (the leasehold estate).

1.4 Types of legal ownership This is a complex area of the law. The following information is at best an outline of the main types of ownership. Land can be owned in various ways. A person might be the legal owner (freehold or leasehold) and/or they might have a beneficial interest (sometimes known as an owner in “equity” or an “equitable owner”). For example, someone who has contributed to the purchase of a property might (though it will depend enormously on the specific facts) have a beneficial interest in the property. Expert advice would usually be needed to verify the existence of a beneficial interest. If two or more people own a property jointly they will own it either as joint tenants or as tenants in common. If they own the property as tenants in common, they may own it in equal or unequal shares. The crucial point to note is that joint tenants or tenants in common relates to the equity in the property. The legal title (the right to transfer or mortgage the property) can only be held as joint tenants. Whether a property is held as joint tenants or as tenants in common makes a difference to what happens to the property on the death of a joint owner, both in terms of who is entitled to the deceased’s share in any equity (the money which would be released if the property was sold 5 Commons Library Briefing, 16 May 2019

after repaying any mortgage) and what steps need to be taken to sell the property. When a property is held as joint tenants, then the joint owners are both entitled to the whole of the equity. This means that on the death of one of the joint tenants the whole of the equity passes to the survivor, irrespective of any provision to the contrary in the deceased’s will. When a property is held as tenants in common the owners hold the equity in shares, often in specified unequal shares. Upon the death of a tenant in common, their share does not pass automatically to the survivor (as with joint tenants) but via the deceased’s will or, if there is no will, via the rules of . However, only the equitable share passes, not the legal title.

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2. Registered and unregistered land

2.1 Recording land ownership There are two parallel systems for recording ownership of land in England and Wales: registered and unregistered. HM Land Registry records property ownership in the Land Registry, which is the official ownership list for property in England and Wales. Northern Ireland and Scotland have their own land registries. Since 1990 it has been compulsory when buying unregistered property or land to apply to have the land registered within 2 months of a sale completing. The LRA 2002 extended the range of transactions subject to compulsory first registration and encourages voluntary registration. The overriding objective of the LRA 2002 is that: “[…] the register should be a complete and accurate reflection of the state of the title of the land at any given time, so that it is possible to investigate title to land online, with the absolute minimum of additional inquiries and inspections”.1 Other transactions which result in a change of ownership and therefore trigger a requirement to register, include: • gifts of land; or • assents by personal representatives. HM Land Registry: Land or property must also be registered for the first time if it’s being compulsory mortgaged. registration The LRA 2002 does not compel the registration of all remaining unregistered land. However, even where there is no ‘trigger’, a legal owner may be persuaded to register their property for the first time because of the various benefits that derive from registration, including: HM Land Registry: voluntary • proof of ownership; registration • protection against land fraud; and • making it easier to change, sell or give the property away in the future The owner can either elect to register the property themselves or instruct a solicitor or conveyancer to do it on their behalf. Detailed information on how to register a property for the first time is provided on the gov.uk website. According to HM Land Registry, as of April 2018, over 85% of the land mass of England and Wales is registered.2 Much of the land owned by the Crown, the aristocracy, and the Church has not been registered

1 Law Commission report: Land Registration for the Twenty First Century: A Conveyancing Revolution, para. 1.5 and the Explanatory Notes to the LRA 2002, para. 10. 2 7 Commons Library Briefing, 16 May 2019

because it has never been sold, which is one of the main triggers for compulsory registration. HM Land Registry is aiming to achieve comprehensive registration in England and Wales by 2030. This is a key target for the Government and is a core component of its Business Strategy 2017-2022. It would result in a more definitive record of property ownership, making property transactions simpler. However, there will always be the odd piece of land where the owners are difficult to identify, which is why the Land Registry is aiming to achieve ‘comprehensive’ rather than total registration.

2.2 Law Commission recommendations to update land registration On 31 Mar 2016, the Law Commission published a consultation paper, “Updating the Land Registration Act 2002”, on improving the operation of certain aspects of the Land Registration Act 2002 (LRA 2002). This included some aspects relating to first registration. In July 2018, the Law Commission published its response to the consultation. In addition to its recommendations, the Law Commission published a draft Bill to update the LRA 2002. The changes are designed to combat fraud and inefficiencies in the land registration system.

2.3 Registered land, what does it mean? HM Land Registry maintains a register of all registered land, which is Registration is the indexed on a map. Each property has its own unique number and official recording of individual register. Each individual register includes three sections, property ownership. namely: 1. Proprietor Register, which contains ownership information. 2. Property Register, which contains a description of the property linked to a map. 3. Charges Register, which contains details of any mortgages or charges affecting the property. The following searches and downloads can be made at the Land Registry: • Title summary, this is a new basic search providing a short summary of the following information: who owns a property, what they paid for it, and if there is a mortgage on it. • A title register search, where it is possible to find out who owns the property, price paid or value (if sold since April 2000) and any rights of way or restrictions on the land noted on the register. • A title plan search, defining the property. • A flood risk indicator, showing the probability of flood for the individual registered property. Further information is provided on the gov.uk website. 8 Tracing ownership of a property or land

2.4 Unregistered land, what does it mean? A search of the Land Registry’s index map will reveal whether a specific property or piece of land is registered or unregistered. As outlined above, not all property is registered. There are various reasons for this but the main one is that there simply hasn’t been a transaction (such as a sale or mortgage) on that property since registration became compulsory in its area Lack of registration does not mean that a piece of land is not owned; owners of unregistered land will have a bundle of paper deeds, which form a record of previous sales, mortgages and other dealings with the land. It can be difficult to ascertain who owns unregistered freehold land as there are no central records of ownership to search, of course, local knowledge may help or the relevant local authority. A seller of unregistered land must prove their ownership. This means Importance of the providing documentation (often referred to as the “deeds”) proving deeds and root of their entitlement. This will involve establishing a chain of documentation title (sometimes known as an ‘abstract’ or ‘epitome’ of title) starting with a good ‘root of title’, such as an original conveyance or mortgage deed, and including all dealings with the legal (and equitable) interests in the land all the way down to the current owner. The new buyer of the property/land will be required to register it for the first time, information is provided on the gov.uk website. 9 Commons Library Briefing, 16 May 2019

3. Who owns that property or piece of land?

3.1 First step: searching the Land Registry The first step in tracing ownership of a property is to conduct a Land Registry search. This can be done online; a fee is payable. The Land Registry has over 25 million registered titles (records of land and property ownership) in England and Wales. Assuming the enquirer has the address, postcode, or title number of a property, they can search HM Land Registry records. A property’s individual register will show the legal owner of the property and any other information which affects the property, including third party interests. Restrictive (or negative) covenants are The first step is to either recorded in the Charges Register of the Official Copies or else in a conduct a Land separate document held by the Land Registry, in which case that Registry search. document will be referenced in the Charges Register as containing covenants. Collectively, all this information is known as “title information”. For a fee, the Land Registry will supply an official copy of the register for a specific property that is registered with them. In cases where the legal owner of a property has died leaving a will, the deceased’s executors should register their details with the Land Registry. They should appear on the register as holding the property/land on trust for the named beneficiaries. If the land is unregistered, the executors may have to prepare documents for the first registration of the land and this may take time. Information on how to search the Land Registry is available from the GOV.UK website. The Land Registry can be checked for a small fee. The Commons Library does not carry out Land Registry searches.

3.2 Second step: local investigation If there is no record of the property on the Land registry, then it is safe You have searched to assume that the property is unregistered. Lack of registration does the Land Registry not mean that a piece of land is not owned. Owners of unregistered and the land or land will have a bundle of deeds, which form a record of previous sales, property is not mortgages and other dealings with the land. registered, what can you do next? However, verifying ownership of unregistered land is a much more difficult task and will involve some detective work. For example, the enquirer could: • Ask neighbouring or adjoining landowners if they know who the owner(s) might be. • Ask any local resident who has lived in the area a long time if they have any ideas about who might on it, they may have local knowledge. • Ask in in the local post office, public house or shop. 10 Tracing ownership of a property or land

• Check adjoining registered properties with the Land Registry for possible clues (a fee would be charged for each property). For example, the registered property may refer to a deed or document which affected not only that registered title but also ‘other land’. The ‘other land’ may have included the unregistered property and the deed/document will refer to the parties to the deed, which may give a clue as to the owner on a specific date. • Search county or local authority records for clues. • Check with the local authority to see if any planning applications have been submitted over the years. (Legally, applicants must sign a certificate to confirm they are the owner or a certificate to confirm they have served notice on the owner who they must name). • Check the local electoral register. If these suggestions do not lead to the answer, the advice and assistance of a professional adviser such as a lawyer might be needed. Internet searches reveal organisations advertising services to find the owner of unregistered land – at a cost. The Library has no knowledge about the effectiveness of these organisations and is not recommending them in any way.

3.3 Third step: bona Vacantia property & escheat

Box 1: What is Bona Vacantia property? In a nutshell, bona vacantia property is ownerless assets (literally, vacant goods).

Bona vacantia may include:

• The estate of a person who dies intestate and has no relatives to inherit the estate. • Assets that were beneficially owned by a company that has been dissolved. • In certain circumstances, assets that were the subject of a failed trust (for example, on the dissolution of a club).

Assets that are bona vacantia pass to the Crown, except in Lancaster and Cornwall, where they vest in the Duchy of Lancaster and the Duchy of Cornwall respectively.

The Treasury solicitor deals with bona vacantia that pass to the Crown. Bona vacantia in the Duchies of Lancaster and Cornwall are dealt with by Farrer & Co. solicitors. The Bona Vacantia division (BVD) of the Government Legal Department is responsible for this function.

It is sometimes thought that unregistered land isn’t owned by anyone. This is not correct. In England and Wales, all land is owned by somebody, even if the legal owner cannot be identified. For example, if a person dies without a valid will (i.e. intestate) and without known kin (i.e. entitled blood relatives), their property or land can pass to the Crown by law, referred to as “bona vacantia” (see Box 1 above). Another common example is where a company has been dissolved and 11 Commons Library Briefing, 16 May 2019

a registered property belonging to it beneficially has not been disposed of. If a property becomes bona vacantia it belongs to the Crown and will normally be sold for full market value. However, the Crown has a statutory power to disclaim (give up) its interest in bona vacantia. This power to disclaim is frequently used in relation to difficult or problematic land, which has limited value or where it would not be cost effective to dispose of it. For example, the type of land that is often disclaimed, includes: • Land used in common (such as private roads, service yards, or amenity land). • Property subject to onerous covenants or other potential liabilities. • Property which is contaminated or has buildings, trees, or other items which are in a dangerous state and condition. • Property in negative equity. • Property subject to a dispute or competing claims.

• Low value property. An escheated estate is usually onerous property of little or The effect of the disclaimer is that the property is deemed not to have no value, or even of vested in the Crown. A notice of disclaimer will be published in the negative value, that “London Gazette” and a copy sent to anyone who has contacted the is difficult to Treasury Solicitor to claim an interest in the property. dispose of because, for example, the If the property disclaimed is freehold land, the freehold title will be land is extinguished, and the property will “escheat” to the Crown estate (see contaminated. Box 2 below). Some 300-500 freehold estates escheat to the Crown every year.

Box 2: Doctrine of escheat Escheat is the process under by which freehold land in England and Wales, which has become ownerless, reverts to the Crown as the ultimate owner of all land. The aim of this doctrine is to ensure that property is not left in ‘limbo’ without recognised ownership.)

Examples of when freehold land becomes subject to escheat include, when:

• The Treasury Solicitor disclaims freehold land which had belonged to a dissolved company. • A company liquidator disclaims freehold land which belonged to a company being wound up. • A trustee in bankruptcy or the Official Receiver disclaims freehold land which belonged to an individual. • A foreign company which owned freehold land in England and Wales is dissolved.

The Crown Estate deals with escheat where the land is within England and Wales but outside Cornwall and the County Palatine of Lancaster (except where the respective Duchy authorities deal with escheat.

To ascertain whether a property or piece of land has become bona vacantia property, would require contacting the Treasury Solicitor at: 12 Tracing ownership of a property or land

Government Legal Department Bona Vacantia Division (BVD), PO Box 70165, London WC1A 9HG. Further information is provided on a gov.uk website. Unfortunately, neither the Treasury solicitor nor the Crown Estate offer a search facility against land that may be deemed subject to “escheat”. The Crown Estate will only deal with an enquiry if it is clearly ascertained that a specified property or piece of land has been subject to escheat.

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