Land Law

[CYNthesys]

Does anyone have any experiences of charges against unregistered property.

I'm asking this because the complaint I'm pursuing relates to a LEGAL CHARGE against unregistered land that the Bank did not register, and
I have just come across this info


REGISTRATION OF CHARGE

To be effective as security, charges of land must be registered at the Land Registry. This applies whether or not the property itself is registered at the Land Registry at the time the charge is created - if the property is unregistered land the creation of the charge will bring about the requirement to register the property itself for the first time at the Land Registry.

http://www.notaries.org.uk/page32/page97/page97.html

[Amethyst]

Re: Land Law

I don't know but its interesting.

If the bank have a legal charge it must be registered with the land registry for it to be effective. Without the land being regsitered, which is the responsibility of those who wish to hold a charge on the land, then I would feel there is no charge.

Thinking around this, if a bank lends a mortgage on a property then the mortage lender registers the charge with the land registry. If a property is a new build (before registry was complusory) and paid for in cash then there is no charge on it and thus it is not registered with the land registry. So if in future a bank lends against the houseand creates a charges on it - it must therefore register it with the land regsitery for the first time as opposed to adding a second charge on it ? That makes sense.

''Although registration of land is now compulsory when it is sold, this hasn’t always been the case. This means many properties across England & Wales are still unregistered. If your land is not registered (you can find out by clicking on the box on the right) and you want it to enjoy the best legal protection ..........''


''
Just over 60 per cent of England and Wales is currently registered with Land Registry and more and more people are choosing to register their property. Although registration is not compulsory until land is sold or mortgaged, making a voluntary application brings many advantages to give you peace of mind.


Registering your land with us proves you own your land. It protects you against claims on your land if someone were to try to encroach on it and is the most effective way to bring all your documentation up to date. It also gives you the added bonus that your title register is easily accessible online.''


so the land is owned outright and has never been registered which means ownership cannot be proven ? which conversely means the legal charge over it would be invalid ?

I'd think it would be a question needs asking to a specialist solicitor to be honest.

Whats the legal charge for, and what documents are there pertaining to it ?


http://www.landregistry.gov.uk/asset...ts/lrpg003.pdf
Think that may relate....if the legal charge creates a caution ?


3.1 Who may apply
The following may apply for a caution
against first registration:
— Her Majesty in respect of
demesne land.
— Any person who claims to be
entitled to an interest affecting
a qualifying estate (see section
3.3 The qualifying estates).


Where the dealing is a puisne
mortgage (second charge) by the
estate owner of unregistered land,
the mortgagee should obtain the
necessary priority for its charge by
making an official search at the Land
Charges Department. If it is not in a
position to ensure that an application
for first registration of the land (and
its own charge) is made within the
priority period of its search, it should
protect its interest by registering a
Class C(i) Land Charge. The mortgagee
can also register a caution against
first registration. Though the caution
will not give it any priority against
subsequent dealings, it will ensure
that it is notified when an application
for first registration is made, so
that it can then apply to register
the charge.



puisne mortgage
Last modified: Thu Feb 23 16:37:37 2006
A puisne (pronounced `puny') mortgage is a Mortgage over unregistered land that is not protected by a deposit of title deeds with the Mortgagee. It is the only legal interest in unregistered land that must be entered on the Land Charges Register to be binding on a purchaser of the estate. `Puisne' means `puny' (that is, weak and ineffectual), and this term reflects the ease with which such a mortgage could be surpressed by later dealings with the land.

[CYNthesys]

Re: Land Law

The Bank held the deeds as security, but didn't register the charge.
The unregistered commercial property had been owned by the same person since the mid sixties.
When it was disposed of the Receivers would have needed to provide a certified copy of the mortgage deed in support.
From what Ive found out, the Law requiring registration of charges came into effect on 1st December 1990.
As the mortgage came into effect in March 1991 I'm beginning to wonder if a true copy of the mortgage deed was provided to the Registry at the time of sale

[Amethyst]

Re: Land Law

Can you check with the registry ?

It's a full mortgage over the property as opposed to just a debt charge ?

[CYNthesys]

Re: Land Law

The Charge Deed was called
"Legal Mortgage by Owner to Secure Customer Account"

It was just to secure debts limited to £27,000

[Amethyst]

Re: Land Law

cool. so it is a charge as opposed to a mortgage.

theres load of info on the land regsitry site. Masses of leaflets which should help a bit.

The charge wasnt lodged with the land regsitry at all - how was it obtained ? through court or pre court voluntarily ?

And whats the position with it now - are they calling it in ?

I have to go out now.

[CYNthesys]

Re: Land Law

When company changed banks way back in 1991, new bank granted a mortgage to pay off monies due to old bank who held deeds as security. Deeds were transferred to new bank and held as security.
Despite no arrears new bank foreclosed 6 years later.
They didnt apply to any court, they just helped themselves by relying on irrevocable powers of sale contained in deed

[CYNthesys]

Re: Land Law

Ive found this on a parliamentary website, but I'm not sure if the word conveyance applies to mortgages, or just to sales of property, any ideas folks ?


Since 1 December 1990, the whole of England and Wales has been subject to compulsory registration. This requires registration of a conveyance of a freehold estate, a grant of a lease of more than 21 years, and an assignment of leasehold land with more than 21 years to run. If the disposition is not registered within the required time, it becomes void as regards the transfer or creation of a legal estate or mortgage. The legal estate reverts to the person transferring it (who then, however, holds it on a trust for the intended recipient).
http://www.parliament.the-stationery-office.co.uk/pa/ld200102/ldbills/002/en/02002x--.htm

[strangewayofsavin]

Re: Land Law

If the bank forclosed in, in1997, would they not have to prove who the poperty was owned by?
A conveyance, would have been attached to the deeds, so if any outstandind finance was atached, then it would have been attached to the debitors/owners record.
If the debitor was not named, would it not be transfered to the nearest heir, as per the inheritance laws?

[CYNthesys]

Re: Land Law

The bank foreclosed in 1997.
The Bank held the Title Deeds together with the Legal Mortgage by the Owner Deed.
When Bank foreclosed it was for xxxxx amount, despite subsequent payments being made under duress/threat the Bank stopped sending statements as is their practice once formal demand has been made.
At a later date the Bank appointed LPA receivers to act on the mortgagees behalf to take possession of his property and realise its security.
The Bank informed the receivers/their solicitors of the amount required to discharge he debt.
Despite the receivers promising to send a completion statement when the property was sold, no such statement was forthcoming. When I chased the Receiver up he replied "that there was no money left in the pot to provide this"
After making a nuisance of myself and insisting, I was reluctantly supplied with a copy.

[CYNthesys]

Re: Land Law

Just come off the phone after talking to the Land Registry

Land Registry confirm that mortgages created after 1st December 1990 are subject to compulsory registration, and that a mortgage would trigger the first registration of unregistered land.

Land Registry didnt seem to think there were any sanctions imposed for non-compliance.

I asked what checks were made by Land Registry if unregistered property was sold.
Apparently they check Title Deeds, and if the property is being sold under Power of Sale, they check the Legal Charge Document. If the property should have already been registered the seller is expected to provide reasons for non-registration, but if they fail to provide reasons the Land Registry doesn't question any non-compliance and the first registration is then processed.
I asked that if there was a second charge on the property registered under the Land Charges Act, if that second charge would take priority over an unregistered charge. The answer was YES, however they didnt seem to know if the registered charge would take priority if the first charge was supported by Title Deeds

[CYNthesys]

Re: Land Law

In my family's case the Bank held 1st charge supported by the deeds, but they never bothered to register the mortgage
There was a large 2nd charge on the property that was registered under the Land Charges Act.
When the property came to be sold, the Receivers took their money first, the bank was paid in full next, but as the sale was at gross undervalue there was a shortfall in favour of the 2nd charge even though it was the sole registered charge
A Charging Order was made against our home for the 2nd charge shortfall ???????

[Amethyst]

Re: Land Law

right that makes more sense now.

And common sense wise its right - the regsitry just corrected the registration of the mortgage to be the first charge.

I don't know how receivers work, but i would have thought the receivers bit should have come after the 2nd charge rather than before the first ? Then got a charging order for the receivers shortfall ?

Thats just how it seems it should be common sense wise without knowing a sausage about how receivers work.

(so feel free to ignore me entirely )

Anyway you are disputing if the mortgage was legitimately registered at all and if it was actually legal for them to take their part of the money from the sale ? which would have left just the 2nd charge and receivers bits and bobs.

[CYNthesys]

Re: Land Law

The Registry didnt correct anything
Receivers always have first grab of the proceeds
The second charge got a charging order for the shortfall

Ive just started a thread on a legal site, and Ive been informed that if on or after 1st April 1988 a first mortgage of unregistered land made on or after that date is not followed within two months by an application for first registration, then the mortgage is void.
This gets better.............

[Amethyst]

Re: Land Law

ooooooooo

interesting cyn. be interesting to see that legislation.