Thirdly there are minor interests29, which are a residuary group of interests not being capable as being registered estates and are protected from the date of registration. There are four different ways of registering minor interests; notices30, cautions31, inhibitions32 and restrictions33. When mistakes are made on the register, the registered title becomes incorrect and needs correcting, a process called rectification34.
If the person looking for rectification is replaced as the registered proprietor, he will usually be free of the burdens produced by the wrongfully registered proprietor35. A person who suffers loss as a result of rectification may claim compensation in the form of an indemnity against the registry, however restrictions do apply36.
These two systems of unregistered land and registered land respectively, indisputably assist the conveyancing process, but like everything they have brought with them many criticisms over the last 75 years or so, in relation to some of their provisions. In need of change, the Law Commission and HM Land Registry worked for six years on what was described by the Secretary of the Lord Chancellor, on 'the single, largest law reform project undertaken in the Law Commission since its foundation in 1965'.
On the 26th February 2002, the Land Registration Act 2002 received Royal Assent and is due to be brought into force on the 13th October 2003, is going to replace the existing statutory framework for land registration; we have in our midst what some might say a 'revolution'37. The reformed act despite the criticisms of the 1925 legislation was passed primarily for one reason, namely to put in place the legislative framework to enable conveyancing to move from away from the paper-based system to an all-electronic system within a few years38.
There will be further associated changes for example that of land charges as all evidence will be found electronically; also changes in first registration, leases, profits a prendre in gross, the registration of Crown land by providing a procedure for the voluntary registration of 'demesne land' and modernising procedures for returning to economic use, land which has reverted to crown ownership; the protection of third party interests, overriding interests and finally there will be changes in the rules of adverse possession.
The knock on effect of these changes being that far more estates will be eligible to be registered under the new act.. Under the 1925 legislation in order to register an estate it had to be either a fee absolute in possession or a lease exceeding 21 years, this is due to change to leases of seven years or less, with a power to reduce it further. Formally it was only the sale that used to trigger registration but now the law is bringing in the reform of any transfer for valuable or other consideration.
The former rule of registration being void if the estate was not registered within two months from the date of transfer is set to be changed to the estate being held on a trust. There was a real endeavour to change under the reformed act the present rules of adverse possession or 'squatters rights' as they are more commonly known; to provide better protection for the owners of 'registered land'. The act will make it much harder for an occupier to establish adverse possession to combat the general feeling that the law was too favourable to squatters under the 1925 legislation39.
There is emphasis on the disapplication of periods of limitation40 of which there was formerly no period of limitation under s. 15 of the LA 1980 (c. 58)41. One important feature of the current legislation that is due to be changed by the new Act is that of overriding interests, the major area of criticism under the registered land system due to the fact that people can find that they have bought estates which are subject to adverse interests which are not clear from the register and difficult to determine.
The two distinct lists42 of the interests that are not registrable are set out in the act but are narrowed quite intensely43. The protection of the interests of third parties over registered land by 'notices' and 'restrictions' was reduced by the new Act44. It states that "either can be sought without the consent of the registered proprietor who must be notified and who will be able to apply for cancellation of notice, or object to an application for a restriction. People who apply must act reasonably. "45
The 1925 legislation is the principal framework on which modern land law has been built, but after seventy-five years of use and development it was in need of gentrification. The systems of registration have proven to be the ideal way to facilitate transactions in real property and have developed since 192546. The unregistered land system is virtually obsolete but it has played an incredibly important role in the development of registration. The registration of all land over the countries of England and Wales at once was simply an unachievable idea but through time and the help of the unregistered land system the target is close.
The most serious defect in the whole system of registration of land charges is the method of registration47. The requirement that a land charge be registered against the owner of the land rather than the estate owner, at the time when the charge was created, rather than against the land itself, has created a number of avoidable difficulties48. The unregistered system is under modern land law substantially and procedurally defective but has been an important step towards modern land law, as we know it.
There is a general belief that the whole process of registration needs developing, the aim to make the HM Land Registry as complete and inclusive as possible, establishing a more accurate register that would give buyers more certainty, by giving fuller information about the rights and responsibilities which the owner has. By achieving this there would be an improvement in the security of property rights in and over registered land by providing a better means of protecting them.
The 1925 Legislation has been subject to judicial and academic criticisms, which portray its lack of clarity and complexity, being seen as the poor relation amongst the six great statutes that made up Lord Birkenhead's reforms of 192549; the new Act should lead to a faster, less stressful way of buying and selling land bringing with it greater transparency to chains of transactions, which is currently a major source of difficulty for buyers and sellers under the current Act. Land just like other areas of trade was in desperate need of modernising its old paper-based system.
The shift in balance from the 1925 legislation that transfer can now only take place through registration has been very much the aspiration of land lawyers for many years, but it is through this revolution or evolution as it could be seen, that has encouraged that goal. The Land Registration Act 2002 is going to change extensively the manner in which conveyancers operate but my belief is that only some time after the new Act comes into force and use, will the true extent of the changes it creates be measured.