Torrens title
Encyclopedia
Torrens title is a system of land title where a register of land
holdings maintained by the state guarantees an indefeasible title to those included in the register. The system was formulated to combat the problems of uncertainty, complexity and cost associated with old-system title, which depended on proof of an unbroken chain of title back to a good root of title.
The Torrens title system was introduced in South Australia
in 1858, formulated by former colonial Premier of South Australia Sir Robert Torrens
. Since then, it has become pervasive around the Commonwealth of Nations
and very common around the globe.
In the United States, states with a limited implementation include Minnesota
, Massachusetts
, Colorado
, Georgia
, Hawaii
, New York
, North Carolina
, Ohio
, and Washington.
In the Dominican Republic
, the system was implemented in 1920, and has been in use since.
, land owners needed to prove their ownership of a particular piece of land back to the earliest grant of land by the Crown
to its first owner. The documents relating to transactions with the land were collectively known as the "title deeds" or the "chain of title". This event could have occurred hundreds of years prior and could have been intervened by dozens of changes in the land's ownership. A person's ownership over land could also be challenged, potentially causing great legal expense to land owners and hindering development.
Even an exhaustive title search
of the chain of title would not give the purchaser complete security, largely because of the principle, nemo dat quod non habet
("no one gives what he does not have") and the ever-present possibility of undetected outstanding interests. For example, in Pilcher v Rawlins (1872), the vendor conveyed the fee-simple estate to P1, but retained the title deeds and fraudulently purported to convey the fee-simple estate to P2. The latter could receive only the title retained by the vendor—in short, nothing. However, the case was ultimately decided in favor of P2, over P1. The courts of equity could not bring themselves to decide against a totally innocent (without notice) purchaser. (Pilcher v Rawlins (1872) 7 Ch App 259, Court of Appeal, viewed in Bradbrook, MacCallum and Moore, 2007, Australian Property Law; Cases and Materials, Lawbook Co., NSW)
The common-law position has been changed in minor respects by legislation designed to minimise the searches that should be undertaken by a prospective purchaser. In some jurisdictions, a limitation has been placed on the period of commencement of title a purchaser may require.
was to give the instrument registered "priority" over all instruments that are either unregistered or not registered until later. The basic difference between the deeds registration and Torrens systems is that the former involves registration of instruments while the latter involves registration of title.
Moreover, though a register of who owned what land was maintained, it was unreliable and could be challenged in the courts at any time. The limits of the deeds-registration system meant that transfers of land were slow, expensive, and often unable to create certain title.
In order to resolve the deficiencies of the common law and deeds registration system, Robert Torrens
introduced the new title system in 1858, after a boom in land speculation and a haphazard grant system resulted in the loss of over 75% of the 40,000 land grants issued in the colony (now state) of South Australia. He established a system based around a central registry of all the land in the jurisdiction of South Australia, embodied in the Real Property Act 1886 (SA). All transfers of land are recorded in the register. Most importantly, the owner of the land is established by virtue of his name being recorded in the government's register. The Torrens title also records easement
s and the creation and discharge of mortgages.
The historical origins of the Torrens title are a matter of considerable controversy. Torrens himself acknowledged adapting his proposals from earlier systems of transfer and registration, particularly the system of registration of merchant ships in the United Kingdom. The Prussian mortgage legislation also served as an example (Hoffmann Karl Bernhard Edler von, Deutsches Kolonialrecht, G.J. Göschen, Leipzig 1907, page 121). James E. Hogg, in Australian Torrens System with Statutes (1905), has shown that Torrens derived ideas from many other sources and that he received assistance from a number of persons within South Australia. Stanley Robinson, in Transfer of Land in Victoria (1979) has argued that Ulrich Hübbe, a German lawyer living in South Australia in the 1850s, made the most important single contribution by adapting principles borrowed from the Hanseatic registration system in Hamburg
.
Nevertheless, it cannot be denied that Torrens' political activities were substantially responsible for securing acceptance of the new system in South Australia and eventually, in other Australian colonies and New Zealand. He oversaw the introduction of the system in the face of often vicious attack from his opponents, many of whom were lawyers, who feared loss of work in conveyancing
because of the introduction of a simple scheme. The Torrens system was also a marked departure from the common law of real property and its further development has been characterised by the reluctance of common-law judges to accept it.
In most jurisdictions, there will be parcels of land which are still unregistered.
On the first registration of land under the system, the land is given a unique number (called a folio) which identifies the land by reference to a registered plan. The folio records the dimensions of the land and its boundaries, the name of the registered owner, and any legal interests that affect title to the land. To change the boundaries of a parcel of land, a revised plan must be prepared and registered. Once registered, the land cannot be withdrawn from the system.
A transfer of ownership of a parcel of land is affected by a change of the record on the register. The registrar has a duty to ensure that only legally valid changes are made to the register. To this end, the registrar will indicate what documentation he or she will require to be satisfied that there has in fact been a change of ownership. A change of ownership may come about because of a sale of the land, or the death of the registered owner, or as a result of a court order, to name only the most common ways that ownership may change. Similarly, any interest which affects or limits the ownership rights of the registered owner, such as a mortgage, can also be noted on the register. There are legal rules which regulate the rights and powers of each of these interests in relation to each other and in relation to third parties.
The State guarantees the accuracy of the register and undertakes to compensate those whose rights are adversely affected by an administrative error. Claims for compensation are very rare.
The registered proprietor of Torrens land is said to have an indefeasible title. That means that only in very limited circumstances can his or her title be challenged. These challenges are established in the legislation, and are subjected to rules made by courts. For example, in Victoria such challenges are established in section 42 of the "Transfer-of- Land Act 1958." A court can also adjust rights as between parties before it, and order changes to the register accordingly.
Different States have different laws and provisions. The following, for example, relates to the jurisdiction of the Australian state of Victoria, where the Torrens system is manifested in the Transfer-of-Land Act 1958 (Vic). Upon registration of his interest and subsequent recording on Title of his interest, the registered owner's claim to his interest in that land is superior to all other interests in the land other than the circumstances listed in s.42 Transfer-of-Land Act 1958 (Vic).
This section indicates that the registered interest holder will be free from all encumbrances other than inter alia:
Additionally, there exist exceptions or circumstances that can 'penetrate' the indefeasibility. Common factors that, when evidenced by a party, may penetrate and defeat the registered holder's claim include:
with the commencement of the Real Property Act on 1 January 1863.http://www.lands.nsw.gov.au/land_titles/land_ownership/torrens_title New Zealand
also adopted a similar system from 1870. http://www.teara.govt.nz/en/land-ownership/3
Land registration
Land registration generally describes systems by which matters concerning ownership, possession or other rights in land can be recorded to provide evidence of title, facilitate transactions and to prevent unlawful disposal...
holdings maintained by the state guarantees an indefeasible title to those included in the register. The system was formulated to combat the problems of uncertainty, complexity and cost associated with old-system title, which depended on proof of an unbroken chain of title back to a good root of title.
The Torrens title system was introduced in South Australia
South Australia
South Australia is a state of Australia in the southern central part of the country. It covers some of the most arid parts of the continent; with a total land area of , it is the fourth largest of Australia's six states and two territories.South Australia shares borders with all of the mainland...
in 1858, formulated by former colonial Premier of South Australia Sir Robert Torrens
Robert Torrens
Sir Robert Richard Torrens, GCMG was the third Premier of South Australia and a pioneer and author of simplified system of transferring land.-Early life:...
. Since then, it has become pervasive around the Commonwealth of Nations
Commonwealth of Nations
The Commonwealth of Nations, normally referred to as the Commonwealth and formerly known as the British Commonwealth, is an intergovernmental organisation of fifty-four independent member states...
and very common around the globe.
In the United States, states with a limited implementation include Minnesota
Minnesota
Minnesota is a U.S. state located in the Midwestern United States. The twelfth largest state of the U.S., it is the twenty-first most populous, with 5.3 million residents. Minnesota was carved out of the eastern half of the Minnesota Territory and admitted to the Union as the thirty-second state...
, Massachusetts
Massachusetts
The Commonwealth of Massachusetts is a state in the New England region of the northeastern United States of America. It is bordered by Rhode Island and Connecticut to the south, New York to the west, and Vermont and New Hampshire to the north; at its east lies the Atlantic Ocean. As of the 2010...
, Colorado
Colorado
Colorado is a U.S. state that encompasses much of the Rocky Mountains as well as the northeastern portion of the Colorado Plateau and the western edge of the Great Plains...
, Georgia
Georgia (U.S. state)
Georgia is a state located in the southeastern United States. It was established in 1732, the last of the original Thirteen Colonies. The state is named after King George II of Great Britain. Georgia was the fourth state to ratify the United States Constitution, on January 2, 1788...
, Hawaii
Hawaii
Hawaii is the newest of the 50 U.S. states , and is the only U.S. state made up entirely of islands. It is the northernmost island group in Polynesia, occupying most of an archipelago in the central Pacific Ocean, southwest of the continental United States, southeast of Japan, and northeast of...
, New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
, North Carolina
North Carolina
North Carolina is a state located in the southeastern United States. The state borders South Carolina and Georgia to the south, Tennessee to the west and Virginia to the north. North Carolina contains 100 counties. Its capital is Raleigh, and its largest city is Charlotte...
, Ohio
Ohio
Ohio is a Midwestern state in the United States. The 34th largest state by area in the U.S.,it is the 7th‑most populous with over 11.5 million residents, containing several major American cities and seven metropolitan areas with populations of 500,000 or more.The state's capital is Columbus...
, and Washington.
In the Dominican Republic
Dominican Republic
The Dominican Republic is a nation on the island of La Hispaniola, part of the Greater Antilles archipelago in the Caribbean region. The western third of the island is occupied by the nation of Haiti, making Hispaniola one of two Caribbean islands that are shared by two countries...
, the system was implemented in 1920, and has been in use since.
Common law
At common lawCommon law
Common law is law developed by judges through decisions of courts and similar tribunals rather than through legislative statutes or executive branch action...
, land owners needed to prove their ownership of a particular piece of land back to the earliest grant of land by the Crown
The Crown
The Crown is a corporation sole that in the Commonwealth realms and any provincial or state sub-divisions thereof represents the legal embodiment of governance, whether executive, legislative, or judicial...
to its first owner. The documents relating to transactions with the land were collectively known as the "title deeds" or the "chain of title". This event could have occurred hundreds of years prior and could have been intervened by dozens of changes in the land's ownership. A person's ownership over land could also be challenged, potentially causing great legal expense to land owners and hindering development.
Even an exhaustive title search
Title search
A title search is a process that is performed primarily to determine the answer to three questions:*Does the seller have a saleable interest in the property?...
of the chain of title would not give the purchaser complete security, largely because of the principle, nemo dat quod non habet
Nemo dat quod non habet
Nemo dat quod non habet, literally meaning "no one [can] give what he does not have" is a legal rule, sometimes called the nemo dat rule, that states that the purchase of a possession from someone who has no ownership right to it also denies the purchaser any ownership title...
("no one gives what he does not have") and the ever-present possibility of undetected outstanding interests. For example, in Pilcher v Rawlins (1872), the vendor conveyed the fee-simple estate to P1, but retained the title deeds and fraudulently purported to convey the fee-simple estate to P2. The latter could receive only the title retained by the vendor—in short, nothing. However, the case was ultimately decided in favor of P2, over P1. The courts of equity could not bring themselves to decide against a totally innocent (without notice) purchaser. (Pilcher v Rawlins (1872) 7 Ch App 259, Court of Appeal, viewed in Bradbrook, MacCallum and Moore, 2007, Australian Property Law; Cases and Materials, Lawbook Co., NSW)
The common-law position has been changed in minor respects by legislation designed to minimise the searches that should be undertaken by a prospective purchaser. In some jurisdictions, a limitation has been placed on the period of commencement of title a purchaser may require.
Deeds registration
The effect of registration under the deeds registration systemDeeds registration
Deeds registration is a land registration system in common law jurisdictions. It is replaced by Torrens title in most of these jurisdictions now, although a few of them, like most of the United States, still maintain such system...
was to give the instrument registered "priority" over all instruments that are either unregistered or not registered until later. The basic difference between the deeds registration and Torrens systems is that the former involves registration of instruments while the latter involves registration of title.
Moreover, though a register of who owned what land was maintained, it was unreliable and could be challenged in the courts at any time. The limits of the deeds-registration system meant that transfers of land were slow, expensive, and often unable to create certain title.
Creation of the Torrens system
Robert Torrens
Sir Robert Richard Torrens, GCMG was the third Premier of South Australia and a pioneer and author of simplified system of transferring land.-Early life:...
introduced the new title system in 1858, after a boom in land speculation and a haphazard grant system resulted in the loss of over 75% of the 40,000 land grants issued in the colony (now state) of South Australia. He established a system based around a central registry of all the land in the jurisdiction of South Australia, embodied in the Real Property Act 1886 (SA). All transfers of land are recorded in the register. Most importantly, the owner of the land is established by virtue of his name being recorded in the government's register. The Torrens title also records easement
Easement
An easement is a certain right to use the real property of another without possessing it.Easements are helpful for providing pathways across two or more pieces of property or allowing an individual to fish in a privately owned pond...
s and the creation and discharge of mortgages.
The historical origins of the Torrens title are a matter of considerable controversy. Torrens himself acknowledged adapting his proposals from earlier systems of transfer and registration, particularly the system of registration of merchant ships in the United Kingdom. The Prussian mortgage legislation also served as an example (Hoffmann Karl Bernhard Edler von, Deutsches Kolonialrecht, G.J. Göschen, Leipzig 1907, page 121). James E. Hogg, in Australian Torrens System with Statutes (1905), has shown that Torrens derived ideas from many other sources and that he received assistance from a number of persons within South Australia. Stanley Robinson, in Transfer of Land in Victoria (1979) has argued that Ulrich Hübbe, a German lawyer living in South Australia in the 1850s, made the most important single contribution by adapting principles borrowed from the Hanseatic registration system in Hamburg
Hamburg
-History:The first historic name for the city was, according to Claudius Ptolemy's reports, Treva.But the city takes its modern name, Hamburg, from the first permanent building on the site, a castle whose construction was ordered by the Emperor Charlemagne in AD 808...
.
Nevertheless, it cannot be denied that Torrens' political activities were substantially responsible for securing acceptance of the new system in South Australia and eventually, in other Australian colonies and New Zealand. He oversaw the introduction of the system in the face of often vicious attack from his opponents, many of whom were lawyers, who feared loss of work in conveyancing
Conveyancing
In law, conveyancing is the transfer of legal title of property from one person to another, or the granting of an encumbrance such as a mortgage or a lien....
because of the introduction of a simple scheme. The Torrens system was also a marked departure from the common law of real property and its further development has been characterised by the reluctance of common-law judges to accept it.
Overview of the Torrens system
The Torrens title system operates on the principle of "title by registration" (i.e. the indefeasibility of a registered interest) rather than "registration of title." The system does away with the need for a chain of title (i.e. tracing title through a series of documents). The State guarantees title and is usually supported by a compensation scheme for those who lose their title due to the State's operation.In most jurisdictions, there will be parcels of land which are still unregistered.
The Register
The land register is the central aspect of the Torrens system. Originally the register was a bound paper record, but today the register is typically kept in a computerised database.On the first registration of land under the system, the land is given a unique number (called a folio) which identifies the land by reference to a registered plan. The folio records the dimensions of the land and its boundaries, the name of the registered owner, and any legal interests that affect title to the land. To change the boundaries of a parcel of land, a revised plan must be prepared and registered. Once registered, the land cannot be withdrawn from the system.
A transfer of ownership of a parcel of land is affected by a change of the record on the register. The registrar has a duty to ensure that only legally valid changes are made to the register. To this end, the registrar will indicate what documentation he or she will require to be satisfied that there has in fact been a change of ownership. A change of ownership may come about because of a sale of the land, or the death of the registered owner, or as a result of a court order, to name only the most common ways that ownership may change. Similarly, any interest which affects or limits the ownership rights of the registered owner, such as a mortgage, can also be noted on the register. There are legal rules which regulate the rights and powers of each of these interests in relation to each other and in relation to third parties.
The State guarantees the accuracy of the register and undertakes to compensate those whose rights are adversely affected by an administrative error. Claims for compensation are very rare.
Effect of registration
The main difference between a common law title and a Torrens title is that a member of the general community, acting in good faith, can rely on the information on the land register as to the rights and interests of parties recorded there, and act on the basis of that information. A prospective purchaser, for example, is not required to look beyond that record. He or she does not need even to examine the Certificate of Title, the register information being paramount. This contrasts with a common-law title, which is based on the principle that a vendor cannot transfer to a purchaser a greater interest than he or she owns. As with a chain, the seller's title is as good as "the weakest link" of the chain of title. Accordingly, if a vendor's common-law title is defective in any way, so would be the purchaser's title. Hence, it is incumbent on the purchaser to ensure that the vendor's title is beyond question. This may involve both inquiries and an examination of the "chain of title."The registered proprietor of Torrens land is said to have an indefeasible title. That means that only in very limited circumstances can his or her title be challenged. These challenges are established in the legislation, and are subjected to rules made by courts. For example, in Victoria such challenges are established in section 42 of the "Transfer-of- Land Act 1958." A court can also adjust rights as between parties before it, and order changes to the register accordingly.
Indefeasibility of title
Indefeasibility of title applies to the registered proprietor or joint proprietors of land.Different States have different laws and provisions. The following, for example, relates to the jurisdiction of the Australian state of Victoria, where the Torrens system is manifested in the Transfer-of-Land Act 1958 (Vic). Upon registration of his interest and subsequent recording on Title of his interest, the registered owner's claim to his interest in that land is superior to all other interests in the land other than the circumstances listed in s.42 Transfer-of-Land Act 1958 (Vic).
This section indicates that the registered interest holder will be free from all encumbrances other than inter alia:
- THOSE listed on the title;
- THOSE claiming the land on a prior folio (s42(1)(a));
- WHERE the land is included by wrong description on the part of the Registrar and the proprietor is not or has not derived title from a purchaser ‘for value’(s 42(1)(b);
- PARAMOUNT interests (s 42(2)(a)-(f)) – these interests, although even possibly unregistered, are 'superior' to interests that are registered.
Additionally, there exist exceptions or circumstances that can 'penetrate' the indefeasibility. Common factors that, when evidenced by a party, may penetrate and defeat the registered holder's claim include:
- FRAUD – where fraud is committed by the registered interest holder [principle of immediate indefeasibility];
- JUDICIAL – where it can be shown that there was some contractual promise or undertaking by the registered party vis-a-vis the unregistered party.
- INCONSISTENT LEGISLATION – where legislation is enacted after the Torrens legislation is inconsistent with the Torrens legislation, the later piece of legislation will prevail;
- VOLUNTEER – where the registering party acquires the interest for no consideration (e.g. bequeathed in a will). Note, contrast with Victorian law, in New South Wales volunteers will become indefeasible.
Three principles of Torrens system
The Torrens system works on three principles:- Mirror principle – the register (Certificate of Title) reflects (mirrors) accurately and completely the current facts about a person's title. This means that, if a person sells an estate, the new title has to be identical to the old one in terms of description of lands, except for the owner's name.
- Curtain principle – one does not need to go behind the Certificate of Title as it contains all the information about the title. This means that ownership need not be proved by long complicated documents that are kept by the owner, as in the Private Conveyancing system. All of the necessary information regarding ownership is on the Certificate of Title.
- Insurance principle – provides for compensation of loss if there are errors made by the Registrar of Titles.
Adoption
Other Australian colonies introduced similar legislation between 1862 and 1875. The Torrens title system was introduced to New South WalesNew South Wales
New South Wales is a state of :Australia, located in the east of the country. It is bordered by Queensland, Victoria and South Australia to the north, south and west respectively. To the east, the state is bordered by the Tasman Sea, which forms part of the Pacific Ocean. New South Wales...
with the commencement of the Real Property Act on 1 January 1863.http://www.lands.nsw.gov.au/land_titles/land_ownership/torrens_title New Zealand
New Zealand
New Zealand is an island country in the south-western Pacific Ocean comprising two main landmasses and numerous smaller islands. The country is situated some east of Australia across the Tasman Sea, and roughly south of the Pacific island nations of New Caledonia, Fiji, and Tonga...
also adopted a similar system from 1870. http://www.teara.govt.nz/en/land-ownership/3
See also
- CadastreCadastreA cadastre , using a cadastral survey or cadastral map, is a comprehensive register of the metes-and-bounds real property of a country...
, the equivalent concept in the French civil lawCivil law (legal system)Civil law is a legal system inspired by Roman law and whose primary feature is that laws are codified into collections, as compared to common law systems that gives great precedential weight to common law on the principle that it is unfair to treat similar facts differently on different... - Strata titleStrata titleStrata title is a form of ownership devised for multi-level apartment blocks and horizontal subdivisions with shared areas. The 'strata' part of the term refers to apartments being on different levels, or "strata"....
, an enhancement of Torrens Title intended for apartment buildings and house-typed units.