WHAT IS QUALIFIED AND LIMITED TITLE?

On an inspection of a Certificate of Title you may come across a notation under the second schedule, referring to qualified or limited title. These notations are placed upon titles that have been converted from Old System Title, to Torrens Title. Torrens Title is the system used for recording ownership of property in New South Wales.

QUALIFIED TITLE

The major difference between Old System Title and Torrens Title is that a registered interest under Torrens Title is absolute, whilst ownership and or an interest under Old System Title must be established through a chain of titles.

To create a chain of title under Old System Title, you must rely on various Deeds, each document being used to verify the others. This means it is possible that someone else could have a claim for ownership of the property, or some other interest in the property. Any competing claim would still require a separate chain of title to be established that would need to displace the current chain.

Whilst the majority of Old System Title has been converted to Torrens Title, there are still some properties where this has not yet been completed.

In order to allow title to be converted quickly from Old System Title to Torrens Title, a warning is placed on any new Certificates of Title that have been converted from the Old System. The warning alerts the purchaser that there might be some subsisting interest existing under the Old System Title. Once the warning is removed, the qualified title is converted into a full Torrens Title, which is essentially absolute.

Should you require any advice on the removal of a qualification from your Certificate of Title, we recommend that you contact our office.

LIMITED TITLE

The Certificate of Title might also have a notation stating that it is limited title. This notation is recorded on the Certificate of Title when the land shown in the corresponding Deposited Plan has not been investigated by the Registrar General.

Deposited Plans define the boundaries of a property, and also show the position of instruments that affect the property, such as an easement or a right of way. Plans that do not accurately reflect the existing position of the boundaries, or instruments affecting the land, need to be verified or redefined.

In order to allow title to be converted quickly from Old System Title to Torrens Title, the Registrar General may issue a limited Deposited Plan pursuant to section 28T(4) of the Real Property Act 1900. The limited plan is created for the sole purpose of converting the title from Old System Title to Torrens Title, and should not be relied upon for any other purpose.

The limitation may be removed by the lodgment of a plan of survey, which satisfactorily defines the boundaries of the land. It is possible that the land identified in the limited plan may vary from the existing boundaries once properly defined, however such variations are usually minor.

If you are concerned about purchasing a property with limited title, a surveyor can be engaged to check the boundaries of the land prior to entering into the contract to purchase the land.