This article originally appeared in The Scotsman on Monday 15th January 2018.
Voluntary Registration: An Option for the Urban Property Owners?
How has land registration in Scotland changed?
Sweeping changes were made to land registration in Scotland in December 2014.
There are two property registers in Scotland. The Sasine Register was established in 1617 and is a record of individual deeds. Its younger sibling, known as the Land Register, was introduced in 1979 and is a map-based digital register, designed to provide clear particulars of the property backed by a state guarantee.
A title used to make its way from the Sasine Register to the Land Register following a sale. Current Scottish Government policy is to accelerate the transfer of land to the more user friendly Land Register, so that all land in Scotland is registered in the Land Register by 2024 (with all publicly owned land being registered by 2019). To meet this ambitious target, the triggers for moving a title on to the Land Register have increased.
How do these changes affect owners of urban properties?
There are three ways in which a title might make its way on to the Land Register.
Firstly, all transfers of land and certain other transactions (such as a lease for over 20 years or a standard security, typically granted in connection with a mortgage or to secure a contractual obligation such as an option) will trigger the move.
Keeper Induced Registration
Secondly, the Keeper of the Registers of Scotland can decide to move a title on to the new Land Register without involving the titleholder in any way. This is known as Keeper Induced Registration (or KIR). At this stage KIR is being used to register titles to urban residential properties in ten counties. A list of affected postcodes is available on Registers of Scotland’s website, and it is expected that as time goes on this list will increase as will the number of affected counties.
As the 2019 target date for registration of all public land in Scotland approaches, it is likely that Registers of Scotland will review what needs to be done to complete the Land Register by 2024, looking at further triggers for compulsory registration and whether KIR can be rolled out more widely to other types of properties.
At some point before 2024, most owners of urban properties whose titles are still on the Sasine Register will either be faced with a transaction which involves compulsory registration or find that their title has undergone KIR. For many urban residential properties, registration by either of these routes will be appropriate and will produce a perfectly adequate registered title.
However, for more complex urban properties (such as development sites and those with known boundary issues) complacency could prove more costly in the long run. In particular, the risk of leaving registration to KIR is that the landowner has no control over the registration process. This can result in costs in reviewing what has been produced, and in sorting out any perceived inaccuracies.
There is a third option. A landowner whose title is still on the Sasine Register does not need to wait for a relevant transaction or KIR to take place, and can apply at any time to have their title move to the Land Register. This is known as Voluntary Registration.
What are the benefits of Voluntary Registration for urban properties?
Taking a proactive approach to land registration and making an application for Voluntary Registration can avoid having to deal with unpleasant surprises arising from a title which has been registered by KIR, or having to deal with registration when under pressure from a transaction.
There are further benefits. A title which is on the Land Register is intended to be easier to analyse than a title which is on the Sasine Register, and for the urban developer, ensuring that the title has been registered in the Land Register will undoubtedly reduce costs and delays of future transactions. In addition, a Land Register title is generally less susceptible to challenge. Taking steps to register the title in the Land Register before a neighbour, can strengthen and protect the ownership position, particularly where the boundaries in the title deeds are unclear or overlap.
There will be a number of factors which will have a bearing on whether or not Voluntary Registration is appropriate and when an application for Voluntary Registration should be made. For the urban landowner whose title is still on the Sasine Register, land registration should not be ignored and Voluntary Registration is an option which should be given serious consideration.
Rona Macdonald is an Associate in Turcan Connell’s Land and Property Team.