There's a Restriction on my title. What's that all about?
17 May 2021 | Home, Property & Land |
What are restrictions on a land registry titles?
An entry on a Land Registry title which says (in more legal language) that a transfer, lease, grant of rights “can’t be registered unless a certain thing has happened or a certain document is produced.”
For example:
Well let’s look at a sale. If the Restriction can’t be complied with then the sale won’t go through, and it will be the seller’s job to sort that out. So your conveyancer needs to know from the outset how they are going to deal with it.
Any good news?
Well yes, in a lot of cases you won’t even hear about the Restriction. If you are joint owners then there will often be a Restriction on your title, but it won’t usually present a problem of any kind on a sale.
Anymore?
Yes. You might hold land on trust – if so then so long as you are abiding by the rules of the Trust then you (or the conveyancer) can sign a certificate stating that and that should ‘do the job’.
Any others?
In other cases (usually where one joint owner has died) your conveyancer may say, “we need to appoint a second trustee”, which may not make much sense, but it just needs a second person to join in and sign with you as if they were the joint owner. That will get the sale through (but NB: What did the deceased’s will say about their share of the property? That must be followed.)
So why this blog?
Well, sometimes a Restriction is there to back up an obligation to a third party, a neighbouring owner, a landlord, even a previous owner. Sometimes that person might be entitled to an additional payment, or to a service charge or ground rent, or to have pipes and drains, roadways or boundaries maintained. Payment may be due, or maintenance may be overdue, or commonly (for technical reasons) the third party may just be requiring the buyer to enter an agreement with them direct, to ‘step into the seller’s shoes’ and to be bound by the same obligations. Only then will a consent be given to the sale or a conveyancer issue a certificate
This will probably affect the timetable and the cost of your transaction. You (or we) will have to:
- work out who all relevant parties are;
- locate them;
- bring any payment arrears up to date, and complete outstanding works (or reach a deal)
- approach the third party’s solicitors and pay their costs (£300-£400?)
- persuade the buyers that they have to collaborate
- agree, and complete the deed of covenant
- obtain the consent or a certificate and assist the buyer with satisfying the Land Registry.
- It might be more straightforward than that and cost less. Possibly.
In conclusion:
Restrictions do serve a legitimate purpose but a lot seem to be unnecessary. Either way they do produce some of those ‘head in hands’ moments for the conveyancer.
So be ready to assist your conveyancer with all relevant information that you may have; keep copies of correspondence and records; disclose any contact/discussions you have already had.
So if it’s a harmless Restriction then you may never know; otherwise let’s make it a challenge rather than a problem!
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