Torrens Title System

Torrens Title System

A system for recording land titles under which a court may direct the issuance of a certificate of title upon application by the landowner.

The Torrens title system is a method of registering titles to real estate. Real estate that is recorded using this method is also called registered property or Torrens property. The system is used in the British Commonwealth countries, including Canada, and in Europe but has not been widely adopted in the United States. The first U.S. Torrens system was enacted by Illinois in 1897.

The system is named after Sir Robert R. Torrens, who introduced it in South Australia in 1858 and later lobbied for its adoption in other parts of the country. He wrote several books on the subject, arguing that his system simplified the transfer of real property and eliminated the need for repeated examinations of land titles.

Under the traditional system of transferring, or conveying, land, the history of the property in question must be examined to ensure that the seller can convey good title to the purchaser. When property is sold, a deed is filed and recorded with the county land office; the deed contains the names of the seller and the buyer; the ownership relationship of the sellers and buyers, if more than one seller or one buyer is involved (for example, joint tenants or tenants in common); and the legal description of the property being transferred. This information is abstracted from each deed and recorded in a document called an Abstract of Title. An attorney or a real estate title examiner inspects each entry to determine that good title has been passed with each transaction. If any problems exist with the title, they must be remedied before the purchaser may obtain good title.

A Torrens system does away with this process. A court or bureau of registration operates the system, with an examiner of titles and a registrar as the key officers. The owner of a piece of land files a petition with the registrar to have the land registered. The examiner of titles reviews the Legal History of the land to determine if good title exists. If good title does exist, the registrar issues a certificate of title to the owner. This certificate is ordinarily conclusive as to the person's rights in the property and cannot be challenged or overcome by a court of law. If a mistake is made by the examiner of titles, an insurance fund pays the person who holds a claim against the land. The fees charged to examine and register property pay for the insurance fund and the operation of the registration office.

When the owner sells the property, the certificate alone is evidence of good title, eliminating the need for a new examination of title. The purchaser presents the deed and the certificate of title to the registrar, who records the purchaser's name on the title.

The one drawback to a Torrens system is the initial cost of registering the property. The system is most effective when unimproved land is subdivided for the first time because it reduces the number of deed entries an examiner must review.

Cross-references

Recording of Land Titles; Registration of Land Titles; Title Search.

References in periodicals archive ?
A torrens title system is an "absolute title by registration" system whereby registration of title is conclusive evidence of title subject to limited exemptions specified under law and a similar system was adopted by the Dubai International Financial Centre Authority (DIFC) to provide investors greater certainty with respect to property interests in the DIFC.
Because the Torrens title system makes many of the details relevant to a valuation exercise readily accessible, a valuer can obtain a substantial amount of market information easily.