How is ownership of real estate proved?
Ownership of real estate is confirmed through public real estate registries, which show registered ownership (and registered encumbrances). While such registration does not guarantee good title and title insurance is not available in Japan, it is generally perceived as sufficient evidence of ownership in the market and unless due diligence reveals a specific issue there is only a low risk that the registry does not show the correct ownership of the property.
Ownership of real estate is evidenced by a property registry certificate (certidão predial) issued by the Property Registry (Conservatória do Registo Predial ). Additionally, according to the Portuguese law all real estate must have a property tax registry certificate (caderneta) issued by the tax authorities (Autoridade Tributária). Both the property registry certificate and property tax certificate are accessible to the public. The property registry certificate contains the specific description of the plot or building, including area, definition of the type of property (urban or rural), and the registration of rights or restrictions on the property, including liens, mortgages, or encumbrances. The tax registry certificate is a document certifying the registration of the property with the tax authorities. Access to these public records when acquiring real estate is essential, not only for confirmation purposes, but also to assess whether there are any registrations that may affect the ownership transaction, such as any rights, restrictions, or charges, including mortgages, easements, or encumbrances on the property. As a general rule, the facts subject to registry, such as the purchase and sale of property, shall only become effective against third parties (erga omnes effects) after the corresponding registry date.
There are two mutually exclusive systems for the registration of land – Land Registry and Registry of Deeds. Both the Land Registry and the Registry of Deeds are managed and controlled by the Property Registration Authority, a State organisation.
Land Registry: Property registered in the Land Registry is said to be "registered". When title is registered in the Land Registry, all relevant particulars pertaining to the property and its ownership are entered on folios which form the register maintained in the Land Registry. The title shown on the folios is guaranteed by the State. Registration in the Land Registry is definitive proof of ownership. However, mapping is not definitive as the Land Registry operate a non-conclusive boundary system.
Registry of Deeds: Property registered in the Registry of Deeds is said to be "unregistered". The Registry of Deeds deals with the registration of documents only and their priority against third parties. Registration in the Registry of Deeds alone is not definitive proof of ownership. Title must be fully investigated to determine ownership.
Since 1 June 2011, the sale of property in all counties in Ireland triggers compulsory registration in the Land Registry. Almost 90% of the legal titles in Ireland are now registered in the Land Registry.
Title to real estate is generally evidenced by a public deed granted before a notary public and recorded with the corresponding Public Registry of Property (“Public Registry”). Each Public Registry is managed by the local government authority, usually the city or municipality where the real estate is located.
The notary public granting the public deed, which would constitute evidence of title to the corresponding property, delivers the deed to the Public Registry for registration. The public deed is then granted a record number which serves as evidence of ownership to the public.
In all States, except Quintana Roo, recording the public deed with the Public Registry has a declarative effect, this is, it evidences to third parties consulting the Public Registry who owns the property. Only in the State of Quintana Roo, however, recording of title is mandatory to perfect conveyance of property, which means that title transfers occur only upon the public deed being properly recorded.
Exceptionally, title to real estate can also be evidenced by judicial resolutions (eg. adverse possession) or agrarian certificates regarding certain “ejido” land transactions.
Categories of real estate rights
Dutch law has two categories of real estate rights: real rights and personal rights. A real right is linked to the real estate and is independent of the person that holds it. Such a right can be registered in the public registers and can be transferred. The personal right is linked to a person and, unlike a real right, cannot be transferred, unless the party with which he entered into that legal relationship cooperates in transfer of the legal relationship.
Real estate located in the Netherlands and geographic information are registered in the Land Register, a register open to public access. This may also apply to ships, aircrafts and underground or other networks, but they will not be addressed in this legal guide.
Facts that are relevant to the legal status of real estate can be registered in the Land Register. Registration in the Land Register is even a constitutive requirement in order to transfer real estate or to create restricted rights, such as a mortgage. Other facts however are not or cannot be registered in the Land Register, such as a tenancy right.
The purpose of registration in the Land Register is to increase legal certainty. The moment a real estate acquisition is registered in the Land Register, earlier facts eligible for registration cannot be held against the owner if those facts were not registered. This does not apply if the acquirer was or ought to have been aware of the fact.
Facts eligible for registration
Without wishing to provide an exhaustive list of facts eligible for registration in the Land Register, the following are a number of such facts, of which some, moreover, cannot take place without being registered in the Land Register:
- a transfer of title to real estate or a right of leasehold or right of superficies;
- a mortgage right;
- an attachment;
- a right of transfer or a pre‐emptive right;
- the creation of a servitude; and
- a usufruct.
Apart from a few exceptions, such as the pre‐emptive right of public authorities and attachment, the civil‐law notary is responsible for the correct registration of these facts in the Land Register.
As stated above, a right of transfer can be registered (which is known as Vormerkung). The registration must in any event state the essentials of the contract of sale, such as the parties’ names, the property, the price and any conditions precedent or conditions subsequent. In commercial transactions the advantages of registration, i.e. protection of the buyer for a period of six months against (among other things) subsequent attachments or transfer to third parties, do not always outweigh the loss of the confidentiality that is often desired until all the conditions stipulated in the contract of sale have been met.
Ownership is, in principal, possible to prove by all relevant evidence under Norwegian law, and no written contract is necessary. However, ownership is most commonly proved by ordinary contracts between the seller and buyer.
There is an important distinction between ownership to a real estate, and being registered as the title holder of a real estate. The registration of ownership in the land register will only secure the owner against defeat of creditors and the risk of an other bona fide buyer that is not aware of a transfer that has not been registered.
The land register is the official register of legal rights and obligations associated with property, and is maintained by the Norwegian Mapping Authority (Kartverket), a public agency under the Norwegian Ministry of Local Government and Modernisation. The land register lists ownership, easements and encumbrances such as mortgages, leasing rights, pre-emptive purchasing rights, etc. Details of physical aspects relating to a property, such as borders, areas, buildings and addresses, are registered in the cadastre property register, which is maintained by the individual municipalities.
Ownership of real estate is proved by the ownership deed. This is usually a notarized contract in case of real estate sales and donations, an inheritance certificate issued by a notary public, an ownership title issued by the relevant authority in case of restitution claims filed by administrative procedure or a court decision in case of ownership claims filed in front of the courts of law.
For constructions, the ownership deed is represented by the duly executed reception minute at the completion of the works.
Ownership rights are opposable to third parties by means of their registration in the relevant land book. Once plot-by-plot cadastral measurements will be completed in each Romanian locality, land book registration will have a constitutive effect on ownership rights and the land book registration excerpt will constitute the principal mean of proving real estate ownership. As of the date hereof, of 3181 Romanian localities only 30 have finalised cadastral measurements.
Ownership of real estate is recorded in the public Realty Register controlled by the Federal Service for State Registration, Cadastre and Cartography (Rosreestr). Rosreestr generates extracts from the Realty Register officially confirming title to real estate and recorded encumbrances. Although the Registry records are the only proof of title to real estate, in practical terms. relying solely on the Realty Registry records does not create the status of a bona fide purchaser. To minimise any risks, the title entries recorded in the Registry require thorough, professional, legal due diligence of the property, sometimes even beyond the three year general statute of limitations.
Legal title to real estate is transferred immediately when a binding transfer agreement is executed. Ownership and other real estate related rights/encumbrances are registered in the public Swedish land register, administered by the Swedish government agency the Land Registry (Sw. inskrivningsmyndigheten). The land register is easily accessible online and generally considered to be very reliable.
Registration of ownership creates a strong presumption for title for the registered owner, but does not directly affect the legal validity of the underlying acquisition. A legally binding written contract, verifying the buyers acquisition, must however be submitted to the Land Registry in order to obtain registered title. Anyone purchasing Swedish real estate is required under law to apply for registered title following the acquisition.
The proof of ownership of any real estate is solely given by the registration contained at the competent land registry. Land registries provide, upon request, official excerpts of the land register for any specific plot of land. Apart from the name of the owner(s) and the type of ownership, such excerpts will notably contain the registration number of the plot, its location and size, as well as any easement, encumbrance and/or lien, such as any mortgage, registered on such plot. Plans of the land plot, and in most cases of any building contained on such plot, are also available at the land registry.
The title to real estate is evidenced by registration in the land register. In Turkey, each real estate is registered before the land registry where the real estate is located. The land registry allocates a separate page for each real estate which includes information regarding the surface areas, block, section numbers of the parcel, legal owners, any encumbrances, annotations, price and undertakings etc. The land register is managed by the General Directorate of Land Registry and Cadastre set up under the Ministry of Environment and Urbanization.
Regulations related to the real estate fully respects the land registry records as evidence of property ownership and the rights of bona fide third parties are protected under the Civil Code in case they acquire the ownership (or any other rights in rem) by relying on the records in the land registry. The government will be liable for losses of these third parties due to incorrect registrations in the land registry.
Each real estate property in Brazil has a number of record, which, in Portuguese, is called and known as “matricula”. This is an enrolment with the competent Real Estate Registry Office, that identifies precisely: (i) the property, (ii) its area, (iii) boundaries, (iv) location, (v) previous and current owners, and (vi) liens and encumbrances, if existent.
The registered owner of a property is presumed to be the lawful owner, but such presumption admits proof to the contrary. Since there is no “title insurance” or similar insurance policy allowed in Brazil, purchasers should always conduct a thorough due diligence exercise before acquiring a real estate property.
There is no uniform land registration system across the entire U.S. to verify ownership of real property. Instead, recording systems have been adopted on a state-by-state basis, and each county within each state has its own recorder's office for evidencing ownership and other interests in real property. While there are similarities among the rules of each such recording system and recorder's office, such rules vary by county and it is therefore important to ensure that any instruments that are intended to be recorded comply with the rules of the applicable recorder's office.
In order to confirm ownership of real property in the U.S., it is therefore necessary to perform a title search of the real estate records in the county where the applicable property is located. Electronic availability of such records varies by county and, if available, such records are typically only available from a certain date, and therefore, a search of the physical records of the applicable recorder's office is almost always necessary. It is important to note, however, that with few exceptions, a search of a county's real estate records does not guarantee that the owner appearing of record in such search is actually the owner of the property.
As such, prospective purchasers or lenders in U.S. real estate transactions routinely engage a title insurance company to perform a title search on their behalf and, at the time of closing, purchase insurance from a title insurance company to cover the ownership of the property and the state of title thereof. Once engaged, the title insurance company will examine the real estate and other records and produce a title report which discloses, among other things, the record owner, as well as any interests to which such record owner's title is subject, such as leaseholds, security interests, easements, restrictive covenants, and other liens and encumbrances.
It is important to note, however, that a title report by itself is not an insurance policy and therefore cannot be relied on in a legal sense; it merely provides an indication as to what the title insurance company believes is the state of title. As such, prospective purchasers and lenders in U.S. real estate transactions almost always purchase title insurance (the cost of which is paid for once, at the time of the closing and, in the case of a loan, is paid for by the borrower), which insures that title to the property is in the name of the insured, and provides coverage against, among other things, any defects, liens or encumbrances on title, other than those noted in the policy. The principal benefit of purchasing a title insurance policy is to cover claims that arise after closing and which threaten or impair the insured’s interest in the real property and, in such instance, the title insurance company will pay or dispose of the claim in accordance with the terms of the policy. A title insurance policy also covers against the risk of forged documents and, in most jurisdictions, matters that arise between the date of closing and the date that the applicable instrument is recorded in the real estate records. The premium for title insurance is based on the insured amount (along with the cost of additional coverage, as applicable), is negotiable in some states and is fixed by statute in other states.
As mentioned above, there are three different land registration systems in UK, the English and Welsh system, the Scottish system and the Northern Irish system. Our answers to the questions in this Guide are limited to land situated in England and Wales.
Land in England and Wales is a mix of registered land (which is registered on a publicly available government register) and unregistered land. The vast majority of land is now registered. Most of the unregistered land is owned by historic estates or governmental bodies. Unregistered land must be registered at the Land Registry if is sold. It is therefore uncommon to come across unregistered land in commercial transactions. For this reason we have limited our answers to the questions in this Guide to registered land.
Proof of ownership to registered land is by reference to the register. The register is an electronic register, which lists, in particular, the registered owner/s, all registered encumbrances (e.g. mortgages and leases) and rights and includes a plan showing the extent of the registered land. Each registered interest (see Q4 below) is given a unique title number. An official copy of the register for each title number can be obtained online for a small administrative fee. In broad terms, the register is definitive although in some circumstances it can be subject to "rectification" to deal with matters such as errors and fraud. Compensation is potentially payable by the Land Registry in the cases where there are errors in the register.
The establishment and transfers of rights in rem, as well as any changes to them, must be registered in the Land register, set up by the Register Agency to the Ministry of Justice. Registration is not a proof of title.
Ownership and limited property rights in Bulgaria are proved on the basis of the respective title documents as provided for in the law. These are usually notary deeds for the property (land or buildings), but also notarized contracts, administrative acts, and others. The notary deed is executed by a duly qualified Notary public authorised to act within the area, where the property in question is located. The entry into the Land register is an act of a competent judicial body where certain circumstances are recorded in the respective Real Estate File and the documents evidencing such circumstances are filed in special books.
When the property is transferred as part of the commercial enterprise of the seller no notary deed is issued. The transfer is executed in the form of a private contract with notarized signatures of the parties, which as well is subject to entry into the Land register and in the commercial register in the files of the two companies.
France has a system of registration for all real estate transactions led by a fiscal and administrative body known as the Land Registry (Services de la Publicité Foncière), which conditions the effectiveness of real estate transfers (and more generally of any liens and encumbrances pertaining to a real estate property) against third parties.
Ownership is proved without a doubt by a thirty-year uninterrupted, peaceful and publicly known possession of a property.
This ‘thirty-year root of title’ is generally proved by the registered title deeds of the property setting out the previous owners of the property over the past thirty years.
The ownership of real estate is generally proved by an excerpt from the Land Register which should be up to date and taken from a reliable source or be certified.
The Land Register, which is kept at the district courts of the various states, is divided into the Index and three Sections. The Index lists cadastral references to a plot of a land or condominium. The ownership of the real estate is established in Section I, in case of co-ownership, also the shares of the co-owners are entered here.
Section II of the Land Register lists the existing encumbrances of the real estate which are subject to registration, for example, easements, rights of pre-emption, priority rights, heritable building rights, whereas in Section III mortgages and land charges are registered.
A change of ownership of the real estate needs to be registered in the Land Register to be valid.
However, certain changes of the ownership such as succession, take place outside the Land Register and it therefore is possible that there is a difference between the formal land registry entry and the legal ownership. Thus the register is not definite but particularly reliable. Therefore an entry within the land register is not a proof, but a strong indicator for ownership.
This applies in particular, as the trust of a purchaser in the entries of the land register is proprietary and for that reason the purchase bona fide is possible.
Hong Kong operates a deeds registration system for recording transactions in land and property, rather than a title registration system. Ownership of real estate can be registered on a publicly accessible register maintained by the Land Registry. However, registration is not a definitive proof of ownership. Registration in Hong Kong confers only priority on the rights in registered documents. As the records kept are public information, notice is deemed to be given to any party acquiring an interest in the real estate. Registrable documents include deeds, conveyances and other instruments in writing and judgments. Registrable but unregistered documents will be void against any future bona fide purchaser for value or any other deed which is thereafter registered.
Currently, unless otherwise agreed by the vendor and purchaser, proof of title is shown by a vendor showing to a purchaser the Government Lease relating to that land and, (i) where the grant of Government Lease was less than 15 years from the date of the instant disposition, then all title deeds (e.g. assignment, mortgage, charge) and all documents referred to in such title deeds within this period, or (ii) where the grant of Government Lease was more than 15 years from the date of the instant disposition, then only all such title deeds and all documents referred to in such title deeds within this 15 year period. Upon completion, all the originals of these documents which are required for proving good title and relate exclusively to the property and certified copies of all other title deeds in the possession of the vendor shall upon the purchaser's request be delivered to the purchaser. In addition, the vendor's solicitor has a duty to answer requisitions raised by the purchaser satisfactorily.
Spanish law establishes a title recording system which is intended to provide certainty and publicity as to the ownership of real estate assets. Transfers of real estate assets must be executed in a notarial deed (called "escritura pública") before a Notary Public and recorded at the relevant Land Registry in order for transfers to be enforceable with respect to third parties. Land Registries provide legal notice of ownership, encumbrances and other matters relating to immovable property. Generally any acquisition or conveyance of or encumbrance over real estate assets not registered at the relevant Land Registry has no effect against bona fide third parties. The principle behind this system is to set up an a priori control of the legality of actions by private parties in order to ensure certainty of good title in real estate transactions and reduce the possibility of fraud.
As a general rule, the person who registers title first has a better right to the property than anyone registering title thereafter.
Proof of title under customary law may be established by witnesses and historical books attesting to the practice of the people in that locality or by judicial notice. The LUA, on the other hand, makes it lawful for the Governor upon granting a right of occupancy, to issue a Certificate of Occupancy (“C of O”) which evidences the existence of a right of occupancy over the piece of land described in the C of O. Title to land may also be evidenced by other agreement under which title is conveyed e.g. a deed of assignment or conveyance, deed of sublease, land certificate or deed of gift.
The Federal Lands Registry (Miscellaneous Provisions) Act, chapter F15, LFN 2004 and the various Lands Instruments Registration Laws of the States in Nigeria make it mandatory for title instruments to be registered at the relevant Lands Registry. Registration of title to property in Nigeria is, however, not definitive proof of ownership.