Root of title

It is necessary to establish the “root of title” in order to establish the sellers right to sell the property. This means identifying a deed (such as a mortgage, transfer or conveyance) to use to commence the chain of ownership which will end with the current owner. The criteria for selecting a “good root” is

• the deed must be at least 15 years old
• the deed must deal with ownership of both legal and equitable title.
• the deed must legally and physically describe the property.
• the deed must contain nothing that casts doubt on the title. 

In addition it is a good idea to avoid using a gift or an assent. There are two reasons for this. First, it is likely that the title will not have been fully investigated by the donee/beneficiary (because he is not parting with any money in exchange for the land) and second, as the transfer/assent is for no consideration (no money) certain interests which would have been overreached on a sale will not be overreached where the transfer is not for value.

A good practice is to select the most recent deed of conveyance. Preferably involving a sale of the land for consideration. Any lack of a physical description or any covenants can be provided from previous conyances of the land as a pre-root documnt.

Unbroken Chain of Ownership

Once the root is established, it is then necessary to show an unbroken chain of ownership from the root to the seller. This means looking at who the transferee was in the root conveyance and if it was not the seller, finding the deed by which the transferee parted with possession. This process is repeated until the deed under which the sellers acquired the property is reached.

Draft Contract

In order for a contract to be valid there must be the usual offer and acceptance, consideration, certainty of terms, capacity and an intention to create legal relations. The formalities of which are laid down in S2 Law of Property (Miscellaneous Provisions) Act 1989:

1. the contract must be in writing
2. It must incorporate all terms agreed between parties and signed by each party.

A solicitor may only sign a contract on behalf of a client if he has obtained express authority from the client to sign in writing (unless a power of attorney has already been obtained).

The conveyancer must identify who has a right to sell and whether any additional trustees need to be appointed. In the case of co-owners they will always be treated as joint tenants. Which means that on death of a co-owner the legal estate shall pass to the surviving owner under the doctrine of survivorship. It is important with co-owners to identify the nature of their tenancy. Are they Joint Tenants or Tenants in Common.

One of the main differences between the two types of shared ownership is what happens to the property when one of the owners dies. When a property is owned by joint tenants, the interest of a deceased owner automatically gets transferred to the remaining surviving owners. Tenants in common have no rights of survivorship. Unless the deceased individual's will or other instrument specifies that his or her interest in the property is to be divided among the surviving owners, a deceased tenant in common's interest belongs to the estate.

The most common form of a written contract is incorporated with the Standard Conditions of Sale. Traditionally a formal contract is compromised of two parts:

• the particulars of sale - these provide a legal and physical description of the property and may include incumbrances.
• the conditions of sale - the terms on which the property is being sold and can be the subject of negotiation between the parties. These usually include the standard conditions and any Special Conditions agreed between the parties.

The date on the contract is only filled in at exchange stage and unless a provision is made on the front of the contract for completion the SC6.1.1 provides for completion to be the 20th working day after exchange of contracts. Although in practice the parties will agree a date upon exchange of contracts.

Registration and Property Title

First registration became compulsory in all of the UK on December 1990 following a trigger event. Typically a trigger event are

• The transfer of title of a freehold whether for consideration or as a gift, 
• The grant of a lease for more than seven years, 
• The assignment of a lease which at the time of assignment has more than seven years unexpired, 
• Creation of a first legal mortgage, 
• the Partitioning of unregistered land amongst beneficiaries of a trust.
• Appointment of a new trustee of unregistered land.

Registration is governed by the Land Registration Act 2002 (which came into force on Oct 2003). An application for first registration can be made using Form FR1 with documents in support listed on Form DL.

The classes of title that can be awarded under the LRA 1925 & 2002 are:

1. Absolute Title: this is the best possible title. The buyer is awarded the freehold/leasehold title with all rights, privileges and benefits of easements for that property. Absolute title guarantees the proprietor (owner) was the holder of the lease and that the lease was validly granted. The registrar must approve title of lease and the freehold too.
2. Good Leasehold Title: this is granted in situations where the Registrar has not checked the freehold title (usually because one cant not be found) and therefore the Registrar can't guarantee the landlord is entitled to grant a lease which in turn leaves the buyer/tenant at risk of losing the property. Therefore a Defective Title Indemnity policy maybe required.
3. Possessory title: a title granted based solely on possession of the property (usually to a Squatter).
4. Qualified Title: a title that is subject to a specific defect. In this situation a Defective Title Indemnity Insurance Policy will be required.

A title typically contains a title number and is split into 3 parts:

• The Property Register: contains a brief description of the land with reference to the official plan based on a survey. It will also tell you if the property is freehold or leasehold. If its LH then it will also contain details of the lease i.e. date, term, parties, rent and lessors title number. Plus it may also contain any easements/covenants which benefit the land.
• The Proprietorship Register; includes class of title, name and address of registered proprietor. Any limitation to the registered proprietors powers to deal with the land i.e. registered proprietor cant transfer property without consent of the mortgage lender. And as of April 2000 the price paid for the property. In addition indemnity covenants are also noted in the proprietorship register. 
• The Charges register; details any encumbrances affecting the title e.g. restrictive covenants, easements, mortgages. With mortgages it usually contains 2 entries. The first states the charge to the lender and the 2nd the name of the lender. In addition to any restrictive or positive covenants. If not registered they will not bind a buyer.