The Scottish Law Commission is undertaking a thorough review of the system of land registration in Scotland. Two discussion papers have already been published: Land Registration – Void and Voidable Titles (No 125) and Land Registration - Registration, Rectification and Indemnity (No 128). The third and final paper has now been published, dealing with a variety of issues. In Land Registration - Miscellaneous Issues (No 130), the Commission makes proposals for reform in respect of a number of matters, including plans and descriptions, boundaries, servitudes and real burdens, overriding interests, decision-making by the Keeper, the issue of caveats and the pros and cons of introducing priority notices in Scotland, as well as reform of the Personal Registers. The Discussion Papers are each detailed and far ranging and this article provides a flavour of some of the issues raised in the latest offering.
Descriptions and boundaries
The Commission recommends that the Keeper should make greater use of prior titles deeds when making up a new title sheet on a first registration, and in particular should reproduce deed plans where these can better identify the property than the OS map. Other information which should be carried forward from the prior titles would include statements of the area of the land, lineal measurements or the location of a boundary in relation to a particular boundary feature, all of which may provide useful additional information about the extent of the land in question.
Where there are discrepancies in elements of the description of a property in the title, such as where the measurements in the description and on the plan diverge, there is a significant body of case law to which reference can be made. In the Sasine Register, the general principle is that the words will have preference over the plans. In the Land Register, which is principally a plan-based system, conversely, the plan on the title sheet will generally have precedence. The Commission recommends a set of three rules of preference for descriptions in the Land Register which will specify that in the event of a conflict between the plan and the description, the plan will be preferred; that any principle title plan should be preferred to any supplementary plan in the event of conflict between those plans; and also that a larger scale plan will be preferred to one in a smaller scale, unless the smaller scale plan is the title plan to which the previous rule applies.
The relative merits of Section 19 boundary agreements and contracts of excambion are also considered in the Discussion Paper, which looks at the possibility of a new form of "boundary excambion". Section 19 Agreements which were introduced by the 1979 Act were intended to enable boundary discrepancies between two neighbouring properties to be corrected in a comparatively simple way, but there is uncertainly as to the scope of their application, and they are not appropriate in cases where the boundary line is clear, but the parties wish to change it – in such cases a contract of excambion (essentially a document in which the title to bits of land or properties are exchanged between the parties) is usually necessary. A replacement for the Section 19 agreement is proposed, if there is support for replacing this procedure, which would permit a "boundary excambion" specifically for the purpose of clarifying or adjusting the boundary between two properties.
Servitudes and Real Burdens
In earlier Discussion Papers, the Commission has described what they call the "integrity principle" in relation to Land Registration, which means that what an acquirer sees on the Register is what he gets i.e. the integrity of the Register should be taken for granted. This paper proposes that the integrity principle should apply to servitudes, so that an acquirer should be able to take on trust any servitude shown as benefiting the property, but that real burdens should not be subject to that principle. Although the Keeper's warranty would apply in respect of creation and transmission of the burden it would not extend to a warranty that the burden was valid or enforceable or indeed that it had not been extinguished by prescription or acquiescence.
The issue - often a problematic one for conveyancers - of servitudes created other than by express grant followed by registration - e.g. by prescription - is considered, with the Commission generally in favour of some scheme, if it could be devised, of referring to "off-register" servitudes on the Register, and this is explored in their detailed consideration of overriding interests in the Discussion Paper.
The SLC introduces some new technology throughout their reports on the system of land Registration in Scotland. Overriding interests are currently defined in Section 28 of the 1979 Act, and include the interests of tenants under certain leases, non-entitled spouses, crofters, certain types of servitude and the like. The Commission have provisionally re-named these types of rights "unregistered real rights" – and propose that these should be defined as subordinate real rights and the current list of examples in the definitions should be abandoned. Only a limited number of these rights should be capable of being noted, but these should include short leases and occupancy rights neither of which can be noted at present. The Commission recommends that servitudes, public rights of way, certain leases and the occupancy rights of non-entitled spouses and civil partners should be capable of being noted on the Register.
Caveats and Priority Notices
There is no provision in the current system for putting any caveat or restriction notices on the Register which would have the effect either of preserving certain subordinate rights or for preserving priority of rights - usually contractual - in advance of registration. While the Discussion Paper concludes that there is no place for a system of preservation of subordinate rights, it explores in detail the advantages and disadvantages of a system of priority notice, which could be used whenever a deed creating, transferring, varying or discharging a real right in land is granted. The Commission indicates that it has not yet reached a provisional view on the advisability of such a system, and it is looking for views on these and its other proposals. In its favour a priority notice system could ease the problem that arises in a "race to the register" where there are competing titles, and in particular provide additional certainty as to any risk of competition, and for the practitioner, it would reduce exposure in respect of letters of obligation. Views are also sought on how long such a priority notice period, if introduced, should be, with the Discussion Paper suggesting that something between four and six weeks would be appropriate.
Land and rights affecting land are registered in the property Registers, but there are other registers which are relevant to the conveyancing process, where registration relates to persons, and these include the Register of Inhibitions and Adjudications and the Companies Registers. Again the current statutory provisions produce an element of uncertainty and the Discussion Paper sets out and evaluates options for reform, and concludes that inhibitions and other entries from the Register of Inhibitions should continue to be copied from that Register to the Land Register, but only where it impairs the validity of a deed which is being presented for registration. This is in line with the proposals relating to inhibitions contained in the Bankruptcy and Diligence etc (Scotland) Bill, currently before Parliament.
The full text of this extensive Discussion Paper is available from the website of the Scottish Law Commission at: http://www.scotlawcom.gov.uk/downloads/dp130_landreg.pdf