overriding interests : current law ✅

reform : land registration act 2002

The Law Commission wanted to reform overriding interests in Land Registration but had to accept that there were reasons why overriding interests could not be abolished altogether

Jackson, 'Title by Registration and Concealed Overriding Interests: The Cause and Effect of Antipathy to Documentary Proof' (2003) : "the principal means by which the 2002 Act aims to improve the accuracy of the register is to narrow the scope for unregistered interests to have overriding effect"

reasons why overriding interests retained

  1. there are some rights which are otherwise protected and it would therefore be unrealistic to expect them to be registered. e.g. local land charges which are registered at the Local Land Charges Register
  1. some rights are either pointless or inconvenient to register
  1. overriding interests provide a means of accommodating rights which can be created informally and where it is unrealistic to expect registration at the time of creation, e.g. rights of persons in actual occupation

Law Commission, 'Land Registration for the Twenty-First Century: A Conveyancing Revolution' (2001) : "the way in which the law on overriding interests has developed over the last seventy-two years has demonstrated that overriding interests are by no means only minor liabilities

  • retention of overriding interests attracted criticism bc of the effect they have on the mirror principle
  • they seem to be unfair on the purchaser : even if a purchaser make attempt to discover whether there are overriding interests but continues to be unaware of their existence, they will still be bound by them and there is no provision for compensation to be paid

The Law Commission concluded that it was neither desirable nor feasible to abolish such rights totally but the Land Registration Act 2002 includes a number of different provisions which together minimise their effect

LAND REGISTRATION ACT 2002

  • distinguishes between those overriding rights within Schedule 1 (interests which override a first disposition) and Schedule 3 (interests which override registered dispositions)
  • schedule 1 includes :

paragraph 1 : leasehold estates not exceeding seven years

paragraph 2 : interests of persons in actual occupation

paragraph 3 : easements and profits a prendre

paragraph 4 : customary rights

paragraph 5 : public rights

paragraph 6 : local land charges

the right is not limited to rights under a trust of land but has extended to rights such as where the claimant is seeking to alter the Register or the right to have a transaction set aside for undue influence - the most problematic aspect of this right is what constitutes ' actual occupation '

interests of persons in actual occupation

  • after lengthy discussion by the Law Commission, they were retained within the LRA2002 but have reduced in significance
  • the interest is still based on two criteria introduced in LRA1925 s. 70(1)(g) required :
  1. an interest in the land
  1. actual occupation of the land