Classes of Titles
Introduction
When you encounter a title register, particularly in section B, you’ll notice the term “class of title.” This classification reflects the Land Registry’s confidence level in establishing ownership during property registration. There are three classes of titles, with an additional title for leasehold properties only. They are absolute titles, qualified titles, possessory titles, and good leasehold titles.
Absolute titles:
An absolute title, written in a title register as ‘title absolute’, refers to a type of title that provides the owner with the highest level of ownership rights and security. Absolute title is considered as the best and strongest form of property ownership as it provides that the ownership cannot be legally contested or claimed against. That could either be an absolute leasehold or an absolute freehold title.
Leasehold ownership usually involves restrictions on the leaseholder, such as a limited term and payment of rent, however an absolute leasehold title grants the leaseholder exclusive rights over the property for the specific term. The absolute leaseholder has substantial rights which include the right to occupy and use the property, as well as selling the property, in which case would be selling the lease to another person.
Absolute leasehold titles are usually more common for flats and apartments as when the property is held on a lease it means that you own the property, the flat, for a specific period but you do not own the land it sits on. Usually the freeholder would be the property management company, meaning that they are the ones that own the actual land, and you would be holding only the flat on lease.
An absolute freehold title is straightforward. It means that as an owner you possess ALL rights over the property with the land it sits on. As stated before, this is the strongest type of title ownership because no other person can contest or claim title over you property.
Qualified titles:
Qualified titles are the least desirable and are extremely rare. It occurs when there is a defect in the title that cannot be disregarded, and it can be registered for either freehold or leasehold properties.
For instance, if the transfer to the applicant had been in breach of a trust, the title may be registered as a qualified title. The proprietor would still obtain ownership over the land, however, it would be subject to the equitable interest of the beneficiaries of the trust breached.
Possessory titles:
Possessory title is typically granted when the owner claims they acquired the land by adverse possession. In other cases, which may be more common, it may be granted because the owner cannot produce the documents necessary to prove the title, usually because the title deeds have been lost or destroyed. Possessory title is also somewhat rare. It could be registered for freehold or leasehold properties.
Good Leasehold:
Good leasehold title is granted when the Land Registry is satisfied with only the leasehold title but not the freehold title. As opposed to an absolute title, where it would be satisfied with both the leasehold and the freehold titles. For example, a property can be registered as a good leasehold if the property is being registered as a leasehold but the freehold title is still unregistered, and the applicant fails to provide evidence of the freehold title.
A good leasehold title can be vulnerable to dispute, which can arise if someone claims the freehold title and proves that the original party that granted the lease had no right to do so.
Conclusion
In conclusion, out of the four possible classes of titles which are absolute, qualified, possessory, or good leasehold, it is best to have an absolute title as it provides the most security over the ownership of the property. A class of title can potentially be upgraded, however there has to be sufficient evidence to prove your claim to the Land Registry.
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