By John R. Blake, Jr.
This article originally appeared in the Spring 2001 edition of Market Place, published by the Greater Lowell Chamber of Commerce.
On January 12, 2001, Acting Governor Jane Swift signed into law legislation supported by both lawyers and Land Court judges which can provide significant economic relief for the owners of registered land, by allowing them to withdraw their property from the registered land system (also known as the Torrens system).
Registered land is treated differently from non-registered land, commonly known as recorded land, in that a Certificate of Title for each registered land parcel is established as the absolute and controlling authority as to ownership and encumbrances. Changes to the Certificate of Title, as in some cases of death or divorce, can be made only through the Land Court in Boston. Another notable difference between registered and recorded land is the cost for recording deeds, mortgages and other instruments, which is usually twice as much for registered land.
The surveying requirements imposed by the Land Court Engineering Department for registered land cause its owners to incur additional time and expense as well. All registered land parcels are shown on approved Land Court plans, which are surveyed in exacting detail. The magnitude of the additional expense becomes apparent when registered land is subdivided. The cost to prepare a subdivision plan for registered land can be two or three times the cost of preparing an unregistered land plan. Further, the registered land subdivision plan must be submitted, along with relevant title documents and deeds to be recorded with the plan, to the Land Court Engineering Department in Boston for approval prior to any closing taking place. This process sometimes entails one or more revisions to the plan, and can take a month or more to complete, which is in addition to the time needed to present the plan to the local planning board for approval and endorsement. However, with recorded land once the surveyor has prepared and certified the subdivision plan it can recorded as soon as it is endorsed by the local planning board, and deeds to recorded land lots can be given without further approval.
Bill S.2297 provides that the owner(s) of registered land may petition the Land Court to have their land withdrawn from the registration system. The amendment to Massachusetts General Laws Chapter 185 provides that a complaint to withdraw land shall be granted where: (i) the registered land comprises less than half the area of a parcel or several parcels of land with a common owner; (ii) the registered land is the remainder (less that 10 percent) of a former larger piece of registered land the balance of which has been previously conveyed; (iii) the owners of the registered land are creating a condominium with the land; or (iv) the Land Court finds other good cause exists for withdrawing the land from registration (including economic hardship).
All owners of registered land must join in the complaint to withdraw the land. Once the complaint is filed and a fee paid for the court costs, a Land Court title examiner verifies the ownership and determines who are the interested parties, such as mortgage holders or lessees. Interested parties are given the opportunity to object to the withdrawal.
There are reasons for keeping land within the registration system. As registered land is subjected to a higher level of scrutiny, there are fewer opportunities for mistakes in the conveyancing process. Also, by statute in Massachusetts, adverse possession cannot be used to claim title to registered land. However, an owner contemplating development of a subdivision, or faced with the need to have a survey prepared to sell a parcel, now has the option of withdrawing their land from the registration system to save time and expense.