The Registration Gap – Revisited
The “registration gap” is the period of time between legally completing a purchase of land and the Land Registry completing the application to note the new owner’s name on the land register.
Only once the new owner is noted on the land register do they get what they have paid for i.e. the legal title to the land.
Until then, during the registration gap, a new owner of land who has paid the seller for it enjoys a beneficial interest only in that land, but which can be protected by law if the new owner is in actual occupation of that land.
The length of the registration gap can be anything from circa 5 weeks in simple cases to many months.
The law sets some traps for those caught in the registration gap. For example, the courts recently decided that a notice served during the registration gap to break a lease was invalid as it was served by the new tenant of the lease before the new tenant had been registered as such at the Land Registry. The break was therefore not exercised and the lease left intact. That can be expensive.
However, the Court of Appeal has now shone a glimmer of light on the topic. In the recent case of Baker v Craggs (2018) a purchaser of land found that, according to the Land Registry titles that eventually came through after purchase, it was subject to a right of way across its land in favour of adjoining land, but which right was granted during the registration gap by the seller.
When asked to determine if the right of way was valid, the courts initially decided that it was valid despite the fact that at the time of grant of the right of way the new owner of the subject land was not aware of it and was in actual occupation.
The Court of Appeal rejected the initial decision stating that the new owner of the subject land was protected by virtue of the fact that it was in actual occupation of the subject land at the relevant time.
Property professionals have welcomed this decision. However, issues on account of the registration gap will probably keep coming until our land registration system develops to a point where no gap exists; perhaps e-conveyancing will be able to solve this.