Remember, remember the 13th October 2013

The Land Registry have just published the latest edition of Landnet which provides guidance and industry news. The below offers their guidance on overriding interests. For more information please read the latest Landnet bulletin.

Sunday 13 October 2013 is a significant date because not only will the Land Registration Act 2002 (LRA 2002) be celebrating its 10th anniversary but some categories of overriding interests will lose their overriding status under s. 117(1) of the Act.

Overriding interests are interests in land that do not appear on the register of title but still bind a purchaser of the land, even if they do not know anything about them. They fall into two categories: those unregistered interests in land that override first registration of title, which are listed in Schedule 1, LRA 2002, and those that override registered dispositions, which are listed in Schedule 3, LRA 2002.

Losing overriding interest status means that:

  •  on subsequent first registration of title to an estate in land, the registered estate will vest in the proprietor free of the rights unless a notice is entered in respect of them, and a caution against first registration (see below) should ensure that a notice is entered 
  • on subsequent registration of a transfer or other disposition of a registered estate in land to a purchaser for valuable consideration, the purchaser will take free of the rights unless they have been protected by a notice, which might be unilateral or agreed (again, see below). 

At midnight on 12 October 2013

The following overriding interests will have lost their overriding status as the chimes of Big Ben fade away and 13 October 2013 begins.

  • A franchise.
  • A manorial right.
  • A right to rent that was reserved to the Crown on the granting of any freehold estate (whether or not the right is still vested in the Crown).
  • A non-statutory right in respect of an embankment or sea or river wall.
  • A right to payment in lieu of tithe.  
  • A right in respect of the repair of a church chancel.

These overriding interests are not what may be considered commonplace but, in the main, are relics of times long past. However, their existence and relevance in the modern world was brought into sharp focus following a House of Lords decision in 2003 concerning church chancel repair (Aston Cantlow and Wilmcote with Billesley PCC v Wallbank [2003] UKHL 37).

What are franchises?

The most common franchise is the right to hold a market or fair granted by the Crown in a charter or letters patent or claimed by prescription. (Prescription or long user is based on the fiction that a grant has been lost.)

It has been possible to register a franchise voluntarily since 13 October 2003, provided it constitutes a legal estate and is either perpetual or for a term of years with more than seven years to run. For more information, see Practice Guide 18 —Franchises.

What are manorial rights?

Manors are of ancient origin and the extent of the manor was usually determined by the original grant from the Crown or superior lord. A manor was self-contained with its own customs and rights within its defined area.

A lord of the manor may exercise certain rights, such as:

  • sporting rights
  • rights to mines or minerals
  • the right to hold fairs and markets

Manorial rights were given overriding status for 10 years.

It was possible to voluntarily register title to the lordship of the manor before 13 October 2003 but the LRA 2002 stopped any new registrations. Not all lordships include manorial rights. Often the sale of the title “Lord of the Manor of…”, and the right to be so called, does not include any manorial rights.

Practice Guide 22 — Manors provides more information on manorial titles and the rights that will lose their overriding status.

What about a non-statutory right in respect of an embankment or sea or river wall?

A non-statutory right in respect of an embankment or sea or river wall relates to a proprietary (as opposed to contractual) liability that has arisen by grant, a covenant supported by a rentcharge, prescription, custom or tenure.

…. or a right to payment in lieu of tithe?

It appears that the only payments in lieu of tithe that still exist are those made payable out of or charged on land by any Act of Parliament other than one of the Tithe Acts. These payments are often called ‘corn rents’ but, just to complicate matters, not all payments called ‘corn rents’ are made in lieu of tithe.

…. or a right in respect of the repair of a church chancel?

Chancel repair liability is the liability of the owner of land to pay for the repair of the chancel of a parish church.

In England the parochial church council, and, in Wales, the Representative Body of the Church in Wales, have the right to collect the money. There may be liability where land was formerly attached to a rectory. Such former rectorial land is not necessarily close to a church building and is not necessarily just in rural areas.

For more detailed information relating to all these rights, see Practice Guide 66 – Overriding interests losing automatic protection in 2013.

Interests already protected

There may already be entries on a register to protect these interests because of information contained in the title deeds on first registration or as a result of a separate application.

For example, where land was formerly copyhold, an entry might have been made in the property register relating to the appropriate legislation preserving the relevant manorial rights.

“The land was formerly copyhold of the Manor of Pinechester and on the enfranchisement thereof there were excepted the mines and minerals and rights referred to in section 23 of the Copyhold Act 1894. Such mines and minerals and rights are not included in this registration.”

An interest will lose its overriding status once a notice in respect of the interest is entered on the registered title, and will not regain that status even if the notice is cancelled.

Protecting interests before 13 October 2013

These interests can be protected without payment of a fee either: a) by a caution against first registration of title, where title to the affected land is unregistered, or b) by entry of a notice, where the title is registered.

As outlined above, in the case of franchises, it is also possible to apply voluntarily to register a franchise before, on and after 13 October 2013.

Protecting interests after 12 October 2013

If the deadline is not met, these interests can still be protected, by way of a caution against first registration or entry of notice, provided they bind the then owner/registered proprietor when the application is made. A fee may be payable.

How to protect the interests

For unregistered land – caution against first registration. Apply on form CT1 and complete the statement of truth in panel 10.  

Registered land- either: apply on form AN1 for an agreed notice, or  apply on form UN1 for a unilateral notice.

For substantive registration of a franchise you will need:

-form FR1

– the original charter or letters patent granting the franchise (Land Registry will return these to you following registration. If the document is in Latin, we will also require a translation.)

– a certified copy of the charter or letters patent

– either a plan, where the application is for first registration of a franchise affecting a defined area, or, where it is not, details of the current administrative area (the county or unitary authority) in which the franchise operates

– all documents proving devolution of title to the applicant

– all other deeds and documents relating to the title to the franchise and in the applicant’s control (If the applicant is unable to produce a full documentary title, evidence to account for the absence, usually a statutory declaration or statement of truth.)

– if the claim is based on prescription, evidence in one or more statutory declarations or statements of truth of at least 20 years’ enjoyment

– form DL in duplicate listing all the documents lodged

– the appropriate fee.

As 13 October 2013 draws nearer, there may be a surge of applications to protect any affected overriding interests in order to beat the deadline. And, as with applications to register lordships of the manor before the LRA 2002 came into force, some applications will just make it but others will be just too late. So, in the time that is left, practitioners have an opportunity to consider the position and what steps, if any, may be needed to protect their clients’ overriding interests.

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