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Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
Torrens Session 03 04 2010 Combined Deck Final
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Torrens Session 03 04 2010 Combined Deck Final

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Winter conference of PRIA held in Washington DC - education session on the history of Torrens land registers in the US.

Winter conference of PRIA held in Washington DC - education session on the history of Torrens land registers in the US.

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  • Just looking at the panel, you know they have opinions, but they are here to share objective information today
  • Key Government function has always been to keep records regarding land and other real estate to properly assess its value and collect real estate taxes
    Earliest cuneiform land records are administrative property records dealing with land, animal husbandry and personnel management
  • Sustain stability & economic development by registering private property rights that promotes internal confidence between its people, its commercial enterprises and its government.
  • Sustain stability & economic development by registering private property rights that promotes internal confidence between its people, its commercial enterprises and its government.
  • A Simple, Understandable Procedure for Recognizing Rights
    Effective, Secure Documentation of Rights
    Protection against Infringement of these Rights by Others
    A Public Record of these Rights so Others Know
    Records Complete and Incontrovertible Proof
    Convenient Methods for Transferring these Rights
    Effective Procedures for Preserving the Written Record
  • "The lucky new Commoner goes to his "given" acre and cuts a turf from the selected site and drops two shillings in the hole made. The High Steward then twitches him with a twig and sticks the twig in the turf, then hands it to him saying, "This turf and twig I give to thee, as free as Athelstan gave to me, and I hope a loving brother thou wilt be." The High Steward then takes the money out of the hole and the new landowner replaces the turf.“ 12th century – Athelstan King of England 924 -939
    “A ceremony performed in medieval England that effected the transfer of land from one party to another.”Livery of seisin was the dominant method of transferring land in England until 1536, and it continued to be legal until
    1925. “A smack on the ear!”
    Terminus the god of boundaries. The stones used to mark borders were sacred to him. In February Terminalia was celebrated by the Romans. The stone or stump boundary-markers were “drenched in sacrificial blood and placed on flowers to renew its protective powers”, “Without you every field would be disputed”
    Property market from Harvard Ma – private property with initials of owner.
    Zero mile post in Washington DC used for as the original distance for freeways from Washington. DC itself is marked by 40 milestones that form the boundary of the District.
  • The exact extent of the jurisdiction of each sovereign was ill-defined and often disputed. For example, although a Dutch company was operating at and near Manhattan, the territory was also claimed by Virginia pursuant to its charter.
    Figure 1: Spanish land holdings in the US 1562 (Source: National Archives II Univ. of Maryland)
    England along the eastern seaboard, but claiming land that was also claimed by France,
  • The example of Virginia offers a fair illustration for the history of the creation of counties. In densely populated England areas were divided into tithing's (ten families), hundreds (hundred families), and shires. No tithing's were established in the colony of Virginia. Hundreds were established, but the division was purely territorial and had no reference to the number of families occupying the large unpopulated areas. Early on the administration of Virginia was divided into cities, boroughs, and hundreds, with the General Assembly of the colony convening in Jamestown. By 1634 the colony was divided into eight large shires (counties) for administrative purposes. “The names bestowed on the new shires were James City, Charles City, Elizabeth City, Henrico, Warwick River, Warrosquoick, Charles River, and Accomac. Each was divided into parishes, precincts or boroughs for the constables, and precincts or walks for surveyors of the highways”. (Bruce 1910) p. 294.
    vital and land records were established at the county level in the original colonies the tradition migrated westward with the population and the creation of new states out of territories
    (Jefferson 1984) p. 260.
    “The recording of deeds in the United States can be traced back to 1641 in Massachusetts; in the Plymouth Colony to 1636; in Connecticut to 1639; in New Jersey to 1676, 1683, and 1698. It has been lately surmised, and perhaps proved, that the Pilgrim Fathers brought the happy idea of recording their conveyances from Holland. The first recording act in Virginia was passed in 1639…; in Pennsylvania, in 1715, by an act still in force. In New York the practice of acknowledging and recording deeds existed already under the Dutch government, and was continued by the Duke’s Laws in 1665. The Maryland registry law of 1692 was in force till 1785. In North Carolina an act of 1715 made the registry of the deed a prerequisite for passing title. All the colonies had recording laws before the Revolution, and in the new states the recorder’s office was one of the first institutions organized by the newcomers; in California, before any legal government. (PATTON ON TITLES 1957) vol. I, footnote 41, p. 11.
  • Northampton County Courthouse Eastville Va
    It was never the intention that the states would give up their sovereignty, but a federal government was established by the Constitution in 1787 empowered to regulate interstate commerce, international dealings through treaty and other mechanisms, the common defense against international aggression, and taxation to provide for the common defense and general welfare of the United States. These principles are reflected in the sections of the Constitution setting out the powers of Congress, the President, the Federal Courts, and Article IV, that regulates the states with regard to these and other matters.
    The land ordinance and NW territory allowed Congress to annex the lands outside of the original 13 states and lay the groundwork for the establishment of the other states. And as a way to begin to deal with the many claims that had been laid on land and to deal with the disputes that had arisen.
  • Federal Grazing Service merged with GLO to create the modern day Bureau of Land Management found now with the Department of the Interior. The BLM's stated mission is
    "to sustain the health, diversity and productivity of the public lands for the use and enjoyment of present and future generations.“
    Federal Grazing service was created to implement the Taylor Grazing Act which managed the leasing of public land for grazing purposes.
  • In a deeds system documents are recorded the. In a title system the registration of the right creates the title to the property.
  • It seems that he was ably helped by Hubbe a lawyer from Germany who was probably the one who told Torrens of the 600 year old system that operated in the Hanseatic towns of Germany, especially Hamburg
  • Does not factor in Customary Systems – but reflects a colonial/historical perspective only
  • It seems that he was ably helped by Hubbe a lawyer from Germany who was probably the one who told Torrens of the 600 year old system that operated in the Hanseatic towns of Germany, especially Hamburg
  • It seems that he was ably helped by Hubbe a lawyer from Germany who was probably the one who told Torrens of the 600 year old system that operated in the Hanseatic towns of Germany, especially Hamburg
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Schick and Plotkin 1978
  • Transcript

    1. Property Records Industry Association Torrens Land Registration Carol Foglesong Peter Rabley/Justin T Holl, Jr Mark Monacelli David Ewan
    2. Property Records Industry Association • www.pria.us Introduction  A year ago (March 2009) Peter Rabley presented “Land Registries Around the World”  Inquires followed:  I’ve heard about Torrens land registration but I have no idea what it is!  Is it better or just different?  So, this is your educational session
    3. Property Records Industry Association • www.pria.us Introduction  They mean to be thought-provoking  So THAT’S why they do it that way!  What IF we did it differently?  Might this change my view of other proposed changes in the industry?  Can this information help me do my job better tomorrow?
    4. Property Records Industry Association • www.pria.us Introduction  Presentation is founded on a whitepaper currently being drafted titled: “The Earthen Vessel: Land Records in the United States”  Special thanks to Justin Holl of ILS
    5. Property Records Industry Association • www.pria.us Introduction  Peter Rabley, International Land Systems  Background & History of Torrens in the US  Mark Monacelli, St. Louis County Recorder  A Day in the Life  David Ewan, NJ Title Insurance Company  Torrens & the Title Insurance
    6. Property Records Industry Association • www.pria.us Background on Torrens  Peter Rabley International Land Systems
    7. Property Records Industry Association • www.pria.us Background on Torrens in the US – Why?  Government function to maintain land records  The earliest written records from 4th century B.C.E. in Mesopotamia  Last two centuries legal rights and responsibilities in real estate transactions have become a primary concern
    8. Property Records Industry Association • www.pria.us Background on Torrens in the US – Why?  Good land records inspire market and public confidence  Property rights are a major engine to economic development  Transparent property rights and processes are essential to stable economic growth
    9. Property Records Industry Association • www.pria.us Background on Torrens – Principles of Land Systems RIGHTS • Ownerships • Leaseholds • Servitudes • Restrictions • Encumbrances • Caveats PARTIES • Owners • Tenants • Mortgagors • Trustees • Caveators • Attorneys PROPERTY • Parcels • Buildings • Construction • Apartments
    10. Property Records Industry Association • www.pria.us Background on Torrens – Expectations of Land Systems  Simple & Understandable Procedures  Effective & Secure Documentation of Rights  Protection against Infringement of these Rights  A Public Record of these Rights so Others Know  Records Complete and Incontrovertible Proof  Convenient Methods for Transferring these Rights  Effective Procedures for Preserving the Record
    11. Property Records Industry Association • www.pria.us Background on Torrens – Early Land Systems - US  Turf & Twig  Livery of Seisin  Terminus ”stake and heaps of Stones”
    12. Property Records Industry Association • www.pria.us Background on Torrens – History of Land in the US  Spain in Florida and the Southwest,  France east of the Mississippi and north of the Ohio River,  The Netherlands present day New York,  England along the eastern seaboard,  Russia extreme NW including Alaska.
    13. Property Records Industry Association • www.pria.us Background on Torrens – History of Land in the US  In the original thirteen colonies a charter for the land from the King.  William Penn received a charter from Charles II for Pennsylvania.  The London Company received a charter to establish a settlement that became Virginia, and the  Plymouth Company received a charter for what is present day Maine  Pilgrims received a patent from the London Company for a settlement in New England near Cape Cod.
    14. Property Records Industry Association • www.pria.us Background on Torrens – History of Land in the US  Governing Subdivisions in Virginia based on those of England of the time.  1634 8 Shires in Virginia  Boundaries extended Westward  Land records first office established in early government divisions  “Conveyances of land must be registered in the court of the county wherein they lie, or in the general court, or they are void, as to creditors and subsequent purchasers.” T. Jefferson  Vital and land records were established at the county level in the original colonies
    15. Property Records Industry Association • www.pria.us Background on Torrens – History of Land in the US  1787 Constitution created Federal Government  Article X “The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.”  Laws of Real Property were left to the States.  Treaty of Paris 1783 British cede land to the United States  Land Ordinance of 1785 & Northwest Territory Ordinance of 1787
    16. Property Records Industry Association • www.pria.us Background on Torrens – History of Land in the US  1812 General Land Office (GLO) in the Department of Treasury managed the lands in these “other” states  In 1946, the GLO was merged with the Federal Grazing Service to create the BLM  “253 million acres (1,023,855 km2 ) or one-eighth of the landmass of the country. BLM also manages 700 million acres (2,832,800 km2 ) of subsurface mineral estate underlying federal, state and private lands”  Establish method for organizing and subdividing the federal land through the public land survey system (PLSS).
    17. Property Records Industry Association • www.pria.us Background on Torrens – Formal Systems of Land in US  Two formal systems of property  Deeds Register Systems  Title Register Systems  Deeds Registers are older than Title Register Systems  Deeds  Name Index  Parcel Index
    18. Property Records Industry Association • www.pria.us Background on Torrens – Deeds & Title Systems LEGAL RELATION RIGHT(S) 0BJECT LEGAL LAND OBJECT SUBJECT RIGHTFUL CLAIMANT (PERSON/ENTITY) RELATIONSHIP BETWEEN MAN AND LAND IN DEED SYSTEM SUBJECT RIGHTFUL CLAIMANT (PERSON/ENTITY) 0BJECT LEGAL LAND OBJECT LEGAL RELATION RIGHT(S) RELATIONSHIP BETWEEN MAN AND LAND IN TITLE SYSTEM Source: Hansen 1995
    19. Property Records Industry Association • www.pria.us Background on Torrens – Deeds & Title Systems  Deeds: little governmental scrutiny  Title: high degree of governmental scrutiny  Deeds: Rapid recording  Title: Slower and bureaucratic  Deeds: Burden on private sector to determine right holders  Title: Burden on government to determine right holders for both first registration and subsequent transactions
    20. Property Records Industry Association • www.pria.us Background on Torrens – Deeds & Title Systems Deeds System  Relatively minor administrative costs  Normal administrative skills  The number of staff depends upon number of transactions  Cost of maintaining registry is much less for government  Rights validity is determined by private sector Title System  Major administrative costs  Requires highly skilled legal specialists  Expensive  Cost of maintaining system is borne by government  Rights validity determined by government
    21. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems  Title registration origins in Germany, Austria, Switzerland.  Hanseatic League  Different use of the property concept and organization of the cadastre (fixed) and role of private licensed surveyors.
    22. Property Records Industry Association • www.pria.usCopyright © 2009 International Land Systems (ILS), Inc.
    23. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems Government Certified Title  Appropriate Legislation  Certificate of Title (Transparent to Public) • Ownership • All Encumbrances  Indefeasible Title  Government Maintains Adjudicated Title for Subsequent Transactions  Parcel Based  Guarantees (Mirror, Curtain, Possibly Monetary)  Adjudication: Systematic or Sporadic
    24. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems  There are two different phases in a title registration system • First registration, that is bringing a property into the title system in the first place • Subsequent transactions after first registration  First registration usually involves an adjudication process • This can be administrative, or • In a court action
    25. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems First Registration – Combined Approach – Systematic and Sporadic  May be most practical economically  Trigger approach (most common) HMLR e.g.: • transfers for value, • mortgages, • subdivisions resulting in three or more parcels of land, • new condominium developments, and • Any proceedings that result in an adjudication of titles.  Use systematic registration in certain problematic areas, sporadic in others
    26. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems Guarantees  Title registration systems guarantee that the persons named as owners in a certificate of title have an indefeasible title  They do not necessarily guarantee boundaries, but a few systems do  They do not guarantee the validity of encumbrances  Mirror guarantee: That the register reflects the current status of title  Curtain guarantee: That the current register is the sole source of title information and that no other source need be consulted, and  Indemnity guarantee: Often government will reimburse persons suffering loss caused by errors, omissions, or misfeasance of the Registrar under legislatively defined conditions.
    27. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems  Encumbrances can’t be guaranteed, because their validity depends upon external facts  Example: Mortgage • Could be usurious • Truth in Lending may have been violated • Other consumer protection may not have been followed
    28. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems  Registered title is considered adjudicated title  Once a title is registered every transaction is scrutinized by the registry office for its validity  This is in contrast to deeds registration where the validity of a transaction is not determined by the registry office  The Registry office must be staffed with highly skilled professionals
    29. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems Examination  The public needs access to the register in order to determine the current status of title  Because of the “curtain guarantee” there is no need for a title search and examination of the “chain of title”  There is no chain of title for a parcel that is registered in a title registration system  Some jurisdictions allow direct access to view the register for a parcel of real estate
    30. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems Examination  Some jurisdictions require that an application be submitted stating the reasons for viewing the information,  All systems will provide a title report,  No title search to construct chain of title,  Attorney simply reviews the information on the certificate of title  Mortgages, liens will have to be paid at closing  These will be listed in the encumbrance section of the certificate of title  Very easy to use for attorney  Understandable to client
    31. Property Records Industry Association • www.pria.us Background on Torrens – Title Registration Systems Examination  Title Registration systems are often perceived as being bottlenecks in a transaction because they require additional scrutiny  There is often a high rejection rate of documents  The registry office often requires multiple trips by parties to satisfy examiners
    32. Property Records Industry Association • www.pria.us Background on Torrens – Who was Torrens?  Sir Robert Torrens the colonial treasurer and registrar-general for South Australia in 1852.  He advocated for conveyancing reform  Published a Torrens bill in 1856 and as member of the House of Assembly introduced a bill in 1857, which was adopted as law on January 28, 1858,  His “system” can now be found in Australia, New Zealand, US, some provinces of Canada, and some countries in the Caribbean, Asia and Africa.  Modified Torrens – starting in late 1950’s in Kenya  Entered US through Illinois in 1897
    33. Property Records Industry Association • www.pria.us Background on Torrens – Why the Torrens System?  “by reason of complexity the community is firmly bound to use a solicitor,  heavy costs are thereby imposed no matter how simple the transaction may be,  "losses and much perplexity" are occasioned to purchasers and mortgagees by reason of the uncertainty of title,  the time involved in the legalities of the transaction is unsuited to the needs of a progressive community, and  the operation of this law (the English Law of Real Property) diminishes the value of land as a secure and convenient basis of credit.”
    34. Property Records Industry Association • www.pria.us Background on Torrens – Why the Torrens System?  Three Key Underpinnings:  “All properties were to have one document, a certificate of title, to evidence ownership,  All interests in every property had to be registered on that certificate of title, and  The certificate of title had to be guaranteed by the government. “
    35. Property Records Industry Association • www.pria.us Background on Torrens – Features of the Torrens System  “Every estate in freehold is represented by a certificate of title,  Title to land is exhibited by registration,  Every certificate of title is guaranteed by the government,  Every registered proprietor named on the certificate of title can be treated, so far as third parties are concerned, as possessing an indefeasible title,  Any person who contemplates a dealing with a registered proprietor must be quite sure that they are in fact dealing with that person,  Registration may correct a defect in title for bona fide purchasers,
    36. Property Records Industry Association • www.pria.us Background on Torrens – Features of the Torrens System  The certificate of title is the place where the general public is entitled, and expected, to look for interests affecting a property,  Knowledge, or notice, of an unregistered or outstanding interest in a property is not considered of itself to be evidence of want of good faith, and  No trusts may be registered on the certificate of title.”
    37. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US “ That it is the sense of the delegates of the World’s Real Estate Congress that they should do what lies in their power to call the attention of their various State Legislatures to the benefits of the Torrens system and recommend its adoption, so modified as to suit to our State Constitution and laws” ‘World’s Real Property Congress’ World’s Colombian Exposition, Chicago 1893
    38. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US  Used initially in US to clear problems in the record  Torrens system was instituted in Cook County 1895, Illinois following the destruction of all public land records in the Great Chicago Fire of 1871, and in metropolitan Boston as a response to the poor quality of historical land records in New England.
    39. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US  Enactment in California, Massachusetts, Colorado, Minnesota, Washington, Ohio, and New York.  Initial virulent opposition by conveyancing attorneys and title insurance companies.  Legal attacks on Constitutional grounds were common, and successful in some instances.  At one time more than twenty states had Torrens statutes, but most have been repealed.
    40. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US  Eight states currently utilize Torrens land registration systems.  Active Torrens registration include Minnesota, Massachusetts, Colorado, Georgia, Hawaii, North Carolina, Ohio, and Washington.  The U.S. Territories of Puerto Rico and Guam also utilize Torrens systems to some degree.
    41. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US  New York and Illinois previously utilized Torrens systems. Suffolk County was the last New York county to have active Torrens certificates. All certificates were to be delivered to the County Clerk for recording on or before January 1, 2000. From January 1997 to December 1999 adverse instruments were allowed. Voluntary instruments were disallowed on January 1, 1997.
    42. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US  In Illinois the use of the Torrens system declined in the 1930s,  60 years of public records were available to private insurance companies, who competed vigorously with the Torrens system, and  In January 1992 the Illinois legislature began the process of phasing it out.
    43. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    44. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    45. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    46. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    47. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    48. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    49. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    50. Property Records Industry Association • www.pria.us Background on Torrens – History of Torrens in the US
    51. Property Records Industry Association • www.pria.us Torrens In Daily Use  Mark Monacelli St. Louis County (MN) Recorder
    52. Property Records Industry Association • www.pria.us Torrens In Daily Use  When/why was Torrens introduced in MN  The difference between Torrens and Abstract Title  View a Torrens Title certificate  Torrens benefits  Torrens drawbacks
    53. Property Records Industry Association • www.pria.us History of Torrens in MN  Introduced in 1901 as an alternative way to title property  Legislation authorized three MN counties with a population over 75,000  Hennepin, Ramsey and St. Louis
    54. Property Records Industry Association • www.pria.us From the 500’ Level  Abstract title-a quite title action, by Court order, will provide evidence of title  Torrens system the title is registered in the name of the owner, with legal description, and a new source of title is created  Torrens and abstract title are separate  Torrens is an adjudicated title process  Under the jurisdiction of the District Court
    55. Property Records Industry Association • www.pria.us To Register property/boundary  Owner files an application with the Court  Examiner of Titles examines the abstract  Legal advisor to the Registrar  If boundaries are unclear may request a Registered Property Survey  Public notice is served  Examiner cites defects, etc.  If no contest-title is issued  If contested the Court will determine ownership, etc.
    56. Property Records Industry Association • www.pria.us Certificate of Title  Transfer of ownership can only be by deed, court order or certificate from the Examiner of Titles  Subject to seven statutory exceptions  The Registrar issues the Certificate of Title  What if there’s a mistake?  Assurance Fund compensates for loss  $1.50 per document held by the state  Few claims
    57. Property Records Industry Association • www.pria.us COT
    58. Property Records Industry Association • www.pria.us
    59. Property Records Industry Association • www.pria.us Benefits…  Not subject to claims/adverse possession  Peace of mind as the boundary, etc. is set  Owners duplicate prevents fraud  Cleaner and more perfect form of title  All title information is listed on cert., title research is easier  Fewer legal description issues  Most new developments use Torrens  System is automated  MN Chapter 508A is streamlined process/uncontested
    60. Property Records Industry Association • www.pria.us It’s not all smooth sailing… *Mgmt. perspective*  Two title plants  Increased cost/requires more employees  Two separate job skills  Staff requires more skills and training  Cross training is more problematic  Cannot commingle operations  Microfilm, etc.  Can be confusing to the public  Can have two forms of title in a parcel  Takes more time
    61. Property Records Industry Association • www.pria.us Torrens & Title  David Ewan New Jersey Title Insurance Company
    62. Property Records Industry Association • www.pria.us Background of Title Insurance  As discussed, deed recording/registration has been used in the US for hundreds of years.  As with Torrens, title insurance is a relatively “new” development.  Title insurance only began in 1876 in Philadelphia, PA
    63. Property Records Industry Association • www.pria.us Background of Title Insurance  Before title insurance, buyers in real estate transactions bore sole responsibility for ensuring the validity of the title held by the seller.  If the title were later deemed invalid or found to be fraudulent, the buyer lost his investment.
    64. Property Records Industry Association • www.pria.us Background of Title Insurance  Question: Why did Abraham Lincoln wind up living in Illinois?  Answer: Because his father (Thomas Lincoln) was the defendant in a title claim in Kentucky where he was born. Rather than pay to defend against the claim, they moved to Indiana (and then later to Illinois).
    65. Property Records Industry Association • www.pria.us Background of Title Insurance  In 1868, Watson v. Muirhead was heard by the Pennsylvania Supreme Court.  Muirhead (plaintiff) had lost his investment in a real estate transaction as the result of a prior lien on the property.  Watson (defendant), the conveyancer, had discovered the lien prior to the sale but told Muirhead the title was clear after Watson’s lawyer had (incorrectly) determined that the lien was not valid.
    66. Property Records Industry Association • www.pria.us Background of Title Insurance  The court ruled that Watson was not liable for mistakes based on professional (the lawyer’s) opinions.  Like Thomas Lincoln, Muirhead lost big time.  As a result, in 1874, the Pennsylvania legislature passed an act allowing for the incorporation of title insurance companies.
    67. Property Records Industry Association • www.pria.us What is Title Insurance?  Title insurance originated as a contract of indemnity that covers the insured person against loss or damage arising out of existing title defects or encumbrances other than those specifically excepted.  Modern extended coverage policies also include protection for certain post-closing events, such as forgery.
    68. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  If the Torrens System says the State provides assurance as to title, why would we need title insurance?
    69. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  To promote ease of transaction, the Torrens system reverses some of the property rules of common law conveyancing.  A purchaser for value (and, in some jurisdictions, a gratuitous transferee) obtains upon registration a title that cannot be impugned on the ground that the seller’s title was defective, or that the conveyance from the seller to the purchaser was invalid for any reason.  REGISTRATION = TITLE
    70. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  The Torrens system compensates the ‘true owner’ for the loss of his or her property right pursuant to this rule.  Under the Torrens system, a man is to have either his interest in the land or adequate monetary compensation therefor.  In reality, there are gaps in the coverage provided by the State guarantee. The gaps, and the extent to which title insurance can remedy them, are as follows:
    71. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  Registration Gap  The Torrens System operates only upon actual registration (not submission).  The period between acquisition of a property right and the actual registration of it is the “registration gap,” one of the major problems facing the Torrens system.
    72. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  First Resort or Last Resort?  Title insurance can improve upon the protection provided by the Torrens indemnity by giving greater coverage against risk and improved enforcement of rights.  The Torrens statutes may vary considerably in their provisions for enforcement of remedies. In some jurisdictions, the Torrens indemnity operates as a fund of last resort. In these jurisdictions, claimants must first exhaust their remedies against the person who was responsible for the loss or who has benefited by the error before becoming eligible for payment from the fund.
    73. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  Additionally, the trend of recent legislative change in Torrens jurisdictions has been to restrict rather than to extend right to indemnity.  Governments have become increasingly unwilling to indemnify for losses caused wholly or partly by the fraud or negligence of agents and professionals acting for the claimant.
    74. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  With Title Insurance, the insured is entitled to payment of the indemnity without any necessity to bring a legal action against the insurer or any other person who caused the loss. (First Resort).
    75. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  Post Acquisition Risks  The extension of the modern title insurance policies to cover post-acquisition risks makes title insurance more attractive to holders of Torrens titles, since the principle of immediate indefeasibility (some jurisdictions) has reduced their security in the period following registration.  Under the rule of deferred indefeasibility (other jurisdictions), registered owners deprived of their interest by the registration of a forged or otherwise void instrument were entitled to be restored to the register.
    76. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  The shift from deferred to immediate indefeasibility improves the security of purchasers, but increases the risks that “true owners” may be deprived of their titles after registration through the wrongful act of another.  In effect, immediate indefeasibility operates to shift risk of loss from the pre- acquisition to the post-acquisition stage.
    77. Property Records Industry Association • www.pria.us Torrens AND Title Insurance?  Duty to Defend  Under a title insurance policy, in addition to indemnity, the insurer undertakes to cover the costs, legal fees and expenses it incurs in defending the insured’s title.  The costs incurred by the insurer in defending the insured’s title do not reduce the amount of the indemnity for loss payable under the policy.
    78. Property Records Industry Association • www.pria.us Torrens AND Title Insurance!  Each has its strengths.  Each has its weaknesses.  The two are NOT incompatible  And actually can complement each other.
    79. Property Records Industry Association • www.pria.us Background on Torrens – What happened in the US?  Economies of scale are needed to realize costs savings for Torrens systems,  Secondary use is the major benefit not initial,  Large initial volume is needed,  Private sector initially provided strong opposition and mobilized resources to transfer the volume to the market. There was no such lobby for Torrens,  Requires government to take liability and provide guarantee,
    80. Property Records Industry Association • www.pria.us Background on Torrens – What happened in the US?  Many benefits to the system are external to the person receiving title,  State had to compete with private sector to hire and train highly skilled staff,  Title Insurance developed quicker than State Assurance Funds,  US is large and land recording is fragmented to the local level 3592 offices, and  Inertia. Historically deeds systems had been in place for 200 years before Torrens was introduced.
    81. Property Records Industry Association • www.pria.us Open Discussion  Questions?  Comments?  Interrogatives?
    82. Property Records Industry Association Torrens Land Registration Carol Foglesong carol.foglesong@occompt.com Peter Rabley prabley@landsystems.com Mark Monacelli monacellim@co.st-louis.mn.us David Ewan DEwan@njtic.com

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