'Torrens Title' is named after its inventor, Sir Robert Richard Torrens who was instrumental in the implementation of this unique and efficient system of dealing with land in 1858. Torrens drew on his background and experience in merchant shipping law to devise a revolutionary system of land ownership, based on the methods of registering ownership of, and dealings with, ships under long-established merchant shipping law.
His innovation resulted from a desire to do away with the complexity of the old English land law which was based on medieval concepts and made conveyancing,or the transfer of properties, cumbersome, time consuming and expensive.
It is now widely used in many parts of the world. In fact, it is one of Australia's most famous legal services exports. The system is one where your title or ownership right, to the property is actually created by the very act of registration, or recording in a central (usually governmental) register or record. In New South Wales the system is largely governed by Real Property Act 1900. As Australia is a federation of sovereign states, each state has a different system of land law, but all are based on the same torrens system.
The main object of the system is to make the register conclusive (in most cases) without a transferee or purchaser having to look behind the register as was the case in the 'old system title' system inherited from age-old English legal practice and procedure. Once your name is registered or recorded on the title register under Torrens title you become the owner of the property to the exclusion of all others, by the very fact of registration. You therefore obtain'title by registration', which is the pivotal concept of Torrens Title.
Under this system no document such as a transfer or a mortgage is effective to pass the title or give rise to an interest in a property unless and until it is recorded at the centralised registry. The Land Titles Office (also known as the Registrar General's) prescribes the form and content of documents which must be used to effect title charges.
It is also important to realise that stamp duty will generally need to be paid on most documents which need to be registered. If stamp duty is payable,the Land Titles Office must refuse to register that document until the duty is paid.
Normally, the person who is recorded as the owner of a parcel of land cannot have his title challenged or overturned. This concept is known as 'indefeasibility'of title. There are, however, exceptions to this general rule. The main ones being:
if a dealing is registered fraudulently ' this is a very complex area of law.
if any existing easement has been wrongly left off the title or misdescribed by the Land Titles Office;
wrong boundary descriptions;
leases for less than 3 years, which do not have to be registered - so, if 'A'transfers to 'B' and no lease is shown on the title, 'B' will take subject to any tenancy, even though not shown, if it is for a term of less than 3 years.
Because indefeasibility of title is state-guaranteed under the Torrens system a person who suffers loss as a consequence of fraud or the omission of some legal interest relating to the title may in some cases have a right to bring a claim against the Land Titles Office.
Other types of title which have the same or similar benefits as Torrens Title include Strata Title and Community Title which are also the subject of their own legislative schemes, but also fall within the broad description of 'Torrens title'.
Other Torrens Title
In addition to these separate categories of torrens title a torrens title property can also be held under:
Qualified Title ' a title subject to those things shown on the chain of title preceding the first issue of the Certificate of Title. The qualified aspect of this form of Torrens title may automatically cease after 12 years from first registration of a dealing for valuable consideration, or earlier if there has been a change of title between strangers for value after 6 years from that first registration. In either case, when the qualification ends, the title becomes a full, unqualified Torrens title. A prudent purchaser will verify the chain of old system documents back to a good root of title (generally, a conveyance - or transfer of the property for valuable consideration, under old system title ' at least 30 years old)
Limited Title ' a title where the actual boundaries have never been investigated by the Land Titles Office because of lack of relevant information and are therefore subject to change until there has been a formal survey plan lodged for that title. A prudent purchaser may wish to obtain a formal survey and lodge it for registration on title, although this can involve considerable expense and delay.
Both qualified and limited. Provided the boundaries are substantially where they were believed to be by Land Titles Office, title will no longer be 'limited'after the formal survey plan is lodged and checked by the Land Titles Office done.
This Information Outline is provided courtesy of Yandell Wright Stell who are experienced in this area of law. They are located at Level 5, 139 Macquarie Street SYDNEY NSW 2000 or call them on (02) 9252-2278 if you would like more information on this legal topic, or you wish to obtain formal advice regarding your situation.
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