When buying or selling a house in Ireland you might hear the title to the property being described as ‘registered’ or ‘unregistered’. The former sounds great, but the latter sounds dangerous - is that right? And why are there two systems?
The answer lies in history. Land has always been a valuable asset, and its value lies in the ability of a seller to convince a purchaser to pay money in return for the legal right to use the property.
Unregistered title
The ‘unregistered’ system is the older of the two. Over hundreds of years, detailed legal rules developed around how a buyer could be certain that land is properly owned by the seller. If the buyer followed these rules, it typically meant that the courts would protect that buyer against claims by third parties stating they owned the land. In this way, buyers could have confidence in paying the seller, and the system works.
At its simplest, this process involves a seller demonstrating to a buyer that there is a documented chain of transactions going back a sufficiently long time to show that the current seller and their predecessors have had undisputed possession of a property, and so are the rightful owners. This is why bundles of title documents feature sometimes in conveyancing – original documents relating to each transaction are produced until a sufficiently long period of documented possession is shown.
This system has obvious disadvantages – processes are heavily reliant on paper records, and the investigation of title to each house must be repeated each time it is sold.
Registered title
In the late 19th century, efforts began to simplify this process. The new system featured a register of ownership, meaning that the bundles of title documents were replaced by an entry on a central state-maintained register that confirmed the identity of the owner. This register was (and still is) open to inspection by the public.
In addition, the accuracy of the information on this register was guaranteed by the State, so that a buyer could comfortably rely on the information on the register without checking it was correct.
Land with a title registered in the Land Registry became known as ‘registered land’, and land outside that system was referred to as ‘unregistered land’. Therefore the ‘unregistered land’ label does not mean that there is a problem with title to a property – it simply means that this title has not been converted to the modern system yet.
Once title to land is registered in the Land Registry, future transactions continue on the basis of the information on the register, and involve filing forms to formally request the amendment of the Register to note a change of ownership.
Initially the use of the register was focused on agricultural land sold by the Land Commission, and this is why rural land in Ireland tends to be registered, whereas urban areas tend to have more unregistered titles.
For many years Government policy has been to extend the registered land system. This was implemented initially by making registration of unregistered land compulsory in certain transactions, and more recently by making registration compulsory in all transactions in particular counties. Since 2011, it has been compulsory to convert unregistered titles to registered in all buying and selling transactions.
This conversion process is called ‘first registration’ and involves Land Registry staff checking the unregistered title(s) of the application before opening a registry entry (a ‘folio’) for that property. Smaller value transactions can be processed by the Land Registry based on a certificate from the applicant’s solicitor, and in every case a modern map of the property will be needed so that the Land Registry can map the location of the property onto its systems.
So is the registered versus unregistered distinction important to sellers and purchasers? Fundamentally, no – your solicitor will be used to managing transactions involving unregistered land, and there should be no alarm for a buyer on seeing a reference to an unregistered title, as the first registration process typically takes place after a sale has been closed. However, it is equally true that managing a first registration application will involve additional work for applicants and their solicitors – particularly on mapping the property. This means that finalising the process can take longer compared to registered land, but will be worth it in the end!
Disclaimer: Please note that this article is for general information purposes only and does not purport to be legal advice. While every care has been taken in its production, no legal responsibility or liability is accepted warranted or implied by the author, publishers or the Law Society of Ireland in respect of any errors, omissions or misstatement. Readers are advised to seek independent professional legal advice before buying/selling a property.
