What is Torrens title? Torrens Title Vs Strata Title: What is Difference?
What is Torrens title?
Torrens title is a land registration and transfer system in which a state creates and maintains a register of land holdings that serves as conclusive evidence (referred to as “indefeasibility”) of title of the person recorded on the register as the proprietor (owner), as well as all other interests recorded on the register.
Instead of using deeds, land ownership is transferred through the registration of a transfer of title. The Registrar issues the new proprietor a Certificate of Title, which is simply a copy of the relevant folio of the register.
The main advantage of the system is that it increases the certainty of title to land and simplifies land transactions.
It was named after Sir Robert Richard Torrens (1814–1884), who designed, lobbied for, and introduced the private member’s bill that became the Real Property Act 1858 in the Province of South Australia, the world’s first Torrens title.
Torrens’ proposal was heavily influenced by Ulrich Hübbe, a German lawyer living in South Australia. Many countries have adopted the system, which has been adapted to cover other interests such as credit interests (such as mortgages), leaseholds, and strata titles.
Principles of Torrens system
The Torrens title system is a technique of recording real estate titles. This method of recording real estate is often known as registered property or Torrens property.
The method is widely utilized in the British Commonwealth countries, including Canada, and throughout Europe, but it has not yet gained widespread acceptance in the United States. Illinois implemented the first Torrens system in the United States in 1897.
Rather than “registration of title,” the Torrens title system operates on the principle of “title by registration” (granting the high indefeasibility of registered ownership).
The approach eliminates the necessity to demonstrate a chain of title (i.e., tracing title back in time through a series of documents).
The State guarantees title, and the system is usually backed up by a compensation scheme for those who lose their title due to private fraud or errors in the operation of the State.
In most jurisdictions, there will be unregistered parcels of land.
The Torrens system is based on three fundamental principles:
- Mirror principle – the register accurately and completely reflects (mirrors) the current facts about title to each registered lot. This means that any transaction affecting a lot (such as a transfer of title, a mortgage or its discharge, a lease, an easement, or a covenant) must be recorded on the register and thus accessible to anyone.
- The curtain principle- states that there is no need to look behind the Certificate of Title because it contains all of the information about the title. This means that, unlike in the Private Conveyancing system, ownership does not have to be proven by long, complicated documents kept by the owner. The Certificate of Title contains all of the relevant information about ownership.
- Indemnity principle – compensates for losses caused by private fraud or errors made by the Registrar of Titles.
The Torrens System’s Benefits
The Torrens System relieved buyers and sellers of the burden of examining long, complicated deeds and dealing with owners who might withhold or lose their deeds or even attempt to commit fraud.
A prospective buyer is no longer required to look beyond the record in the government-managed registry.
The Torrens System is based on the notion of “title by registration” rather than “registration of title.” Rather than buying a piece of land and then registering it, a buyer can only receive a title if it is first registered.
Each parcel of land in the registry is assigned a unique number and title. Each title includes a description of the land’s exact dimensions and boundaries.
A title shows the names of the registered owners as well as any legal interests that have been applied against the title and thus affect ownership. In addition, the registry is open to the public and can be fully searched by them.
The four main principles of the Torrens System provide buyers and sellers with confidence when conducting land ownership transactions. They are:
Conclusive evidence of ownership — This is known as the principle of indefeasibility. Buyers are guaranteed that their land purchase is exactly as described in the title because the government has records of all land titles and is responsible for cataloguing and preserving them.
Transferability – Because there are several well-defined categories of ownership, title owners can transfer ownership to others more easily.
Title registration is required – All titles must be registered in the government’s land registry system. This rule ensures that accurate records of all transactions related to land ownership are kept.
An assurance fund – In the extremely rare case that an owner is defrauded or suffers a financial loss due to some error in the system, an assurance fund is in place to compensate the owner for such losses.
The land register, which records all land transactions, is at the heart of the Torrens system. The register may be a bound paper record, but most registers today are stored in a database. The owner’s name is recorded in the government’s register, which establishes ownership of the land.
The Torrens title also records easements and mortgage origination and discharge.
When land is first registered under the system, it is assigned a unique number (called a volume-folio number) that identifies the land by reference to a registered plan.
The folio documents the dimensions and boundaries of the land, the name of the registered owner, and any legal interests that affect title to the land.
A revised plan must be created and registered to amend the boundaries of a parcel of land. The land cannot be removed from the system once it has been registered.
A change in the record on the register signals the transfer of ownership of a plot of land. The registrar is responsible for ensuring that only legally valid changes to the register are made.
To that end, the registrar will specify what documentation he or she will need to be satisfied that a change of ownership has occurred.
A change in ownership can occur as a result of a sale of the land, the death of the registered owner, or as a result of a court order, to name a few of the most common scenarios.
Similarly, any interest that affects or limits the registered owner’s ownership rights, such as a mortgage, can be recorded on the register.
There are legal rules that govern each of these interests’ rights and powers in relation to one another and to third parties.
The state guarantees the register’s accuracy and promises to compensate those whose rights are jeopardized as a result of an administrative error. Claims for compensation are very rare.
Torrens Tittle Adoption
The Torrens system was established in the Philippines on November 6, 1902, with the passage of Act No. 496, “The Land Registration Act,” which was nearly identical to the Massachusetts Real Property Act of 1898.
The United States
Guam, a US territory, employs the Torrens system. Minnesota, Virginia, Massachusetts, Colorado, Georgia, Hawaii, New York, North Carolina, Ohio, and Washington are among the states with limited implementation.
The state of Illinois was the first to pass a Torrens Title Act, which used a limited Torrens system in Cook County following the Great Chicago Fire, but this system was allowed to expire on January 1, 1992, after it was discovered to be unpopular with lenders and other institutions.
The Torrens System was implemented in California in 1914 as a result of an initiative statute. Although participation in the system was voluntary, once a landowner registered his property, he could not opt out.
The Torrens System, as implemented in California, did not protect buyers from defects caused by federal tax liens, federal bankruptcy proceedings, or the seller’s incompetence, divorce, or probate proceedings.
Because the system was implemented on its own initiative, the legislature lacked the authority to correct these flaws.
The legislature was given authority to amend or repeal the system by an initiative passed in 1954, and it was repealed in 1955.
What is Torrens tittle?
Torrens tittle is the principle of land and real property titling system in accordance with which the government, as regulator ensures that only legally valid changes to the registry are made. All titles must be registered in the government’s land registry system.
How does Torrens tittle work?
Torrens tittle is a system of public registration of legal interests in or over land and for providing conclusive evidence of title, which provides an assurance fund for victims of fraud or official error.
What is the history of Torrens tittle?
The Australian colonial government introduced the system in 1902.
In 1903, the American state of Massachusetts implemented it as an instrument for helping victims of fraud and accident.
In Australia, the Torrens system was introduced in 1902. The government registration of titles under this system prevented fraud from occurring.
In the United States, the state of Massachusetts implemented it as an instrument for helping victims of fraud and accident.
What is Torrens tittle used for?
It provides a number certificate as proof of title to the land. It indicates that the title deed is genuine and certifies that it has not been forged or tampered with. In no case has a law court been mistaken over title in Torrens system lands.
In this system, titles are registered in a public office called registrar’s office or land registry office.
What is Torrens system Law?
The Torrens system is a land title system used in the United States which was introduced at the beginning of the 20th century. It has also been used in other countries such as Australia, Great Britain, and Japan.
In this type of land title system, a document is created called an “original certificate.” Because many citizens had no access to their property deeds or real estate records, this paper record proved their ownership of property.
What is Torrens system in the Philippines?
Torrens system is a land titling system in the Philippines and was first introduced on November 6, 1902, with the passage of “Act No. 496” otherwise known as Land Registration Act of 1902.
The Torrens is a publicly accessible database that proves ownership and title to real property. The certificate of title issued by the government establishes a legal interest in land which can be independently verified.
What are the advantages of the Torrens system?
The concept of a central land registry is a relatively new notion. Countries with Torrens system enjoy the convenience of one, centralized place where all information on land ownership and transactions are found.
Land ownership is also clearly defined, so title disputes are less likely to occur. The presence of a public registry also creates confidence in the real estate market, since buyers can be sure that they are legally entitled to the property they purchase.
A public registry is generally accessible to the public. Any changes to the land register can be easily verified by any interested party, such as a purchaser or a lender.
What are the weaknesses of Torrens system?
It’s a centralized system that requires users to trust the government and its decisions. Any changes to the land register are recorded publicly and permanently, which can make it difficult to alter mistakes in the event they arise.
Some people believe that land rights should be determined by their own localities rather than by central governments.
Where is the Torrens System used in?
Torrens system is currently used in England, Australia and some other countries. The original system is still used in some countries like Philippines. Although there are several countries with Torrens system, it’s not explicitly stated that all use the same law from which to derive their title laws.
What is the difference between Torrens and abstract?
The Torrens System has been used to promote land development, but it is still not widely used in the United States. The most common type of recording in rural counties is an Abstract Title.
An Abstract Title is a “book” that contains all deeds, mortgages, and other documents pertaining to a specific parcel of land.
The abstract system was introduced during the American Colonial period and became widely used in the 19th century.
Why is the Real Property Act 1886 SA often referred to as the Torrens system?
The Real Property Act 1886 or Torrens Act, as it is commonly called in Australia, was passed into law on November 6, 1887.
It provided for a systematic registration of land titles and created a central office to administer the system. Titles could be registered in this office as either certificates or transfer books.
The system was introduced to give title holders protection against fraud and error, with certificates of title being a folder that held evidence of ownership.
What is the reason why Torrens system did not solve the problem during the American period?
The Torrens system was introduced in the Philippines during the American period. It was touted as the answer to all problems but has not lived up to its claim. Among those reasons were the following:
- Poor Law implementation, registration fee is costly, and requirements are too rigid.
- Escrow is unprotected, unsecured, and not enforced by law.
- Land owners still have no security of title.
- Land owners were deprived of their right to patent or register their land in their name as a result of a legislation that was passed in 1887 during the American period.
What is the role of Torrens system?
The role of Torrens system is to give security to the ownership and make it certain that the title deed is not forged or mistaken by anyone.
What is the difference between Torrens and strata title?
Torrens title essentially means that the buyer owns both the land and the building. This is also known as a ‘freehold.’
Strata title essentially means that there are numerous owners of properties on one piece of land, and all owners are accountable for the shared portions known as “common areas.”