A buyer takes free of everything except what section 33(1) of the Land Registration Act preserves. This article deals with the exceptions that create binding obligations on a purchaser — and how to find each one.
(b) Encumbrances notified on the folio
The registered proprietor holds free of all encumbrances except those notified by entry or memorial on the relevant folio of the Register.
This is the mirror principle, and it is the main event. Whatever is on the folio binds you:
- mortgages and charges;
- registered leases and subleases;
- easements and rights of way;
- caveats.
Under section 8(3) these are recorded so as to preserve their priorities, and each memorial states the day and hour of production under section 25(3). So the folio tells you not only what binds you but in what order.
Section 11 makes the Registrar’s duplicate conclusive. A copy produced by the seller is not a substitute. See how to search a title.
(f) Tenancies of three years or less
The proprietor takes subject to a tenancy from year to year, or for a term not exceeding three years, created either before or after the issue of the instrument of title.
This binds whether or not the tenancy is registered. It matches section 49, under which a lease for more than three years must be registered while a shorter one merely may be.
A two-year tenancy will not appear on the folio. Inspect the land. Ask, in writing, who is in occupation, under what document, on what rent and for what term — and get the answer from the occupier as well as from the seller.
(g) Section 28 — tenants in actual occupation
Section 33(1)(g) preserves the effect of section 28, which protects a wider class than paragraph (f).
A “tenancy document” means an unregistered lease, an agreement for a lease, or a lease for a term not exceeding three years.
(2) A registered dealing is subject to a prior tenancy document where a tenant is in actual occupation under it.
(3) But a right to purchase the freehold, or for renewal of the tenancy, is not valid against a subsequent interest holder unless registered or protected by caveat.
So an unregistered lease of any length, and even an agreement for a lease, binds a buyer if the tenant is in actual occupation. That is a substantially wider protection than paragraph (f).
Subsection (3) is the balance: options to purchase or renew are not protected by occupation. A tenant holding an option must register the document or lodge a caveat. Section 28(4) adds that such an instrument imposes the same obligations, for the same period, as if it had been sealed and delivered.
(h) Unregistrable leases, licences and authorities
The proprietor takes subject to a lease, licence or other authority granted by the Head of State or a Minister and in respect of which no provision for registration is made.
The obvious example is a licence under Part XVI of the Land Act 1996 — to graze stock, to strip and take away material, for fishermen’s residences and drying grounds, or for another temporary purpose. There is no registration mechanism for these, and they bind.
To find them: ask the Department, and ask the occupier what authority they hold.
(i) Unpaid rates, taxes and statutory charges
Any unpaid rates, taxes or other money which, without reference to registration under this Act, are expressly declared by a law to be a charge on land in favour of the State, a department or officer of the State, or a public corporate body.
These follow the land, not the person. A buyer who does not search for them inherits them.
Note that this is separate from the Land Act position. Rent owing to the State under a State lease is not a section 33(1)(i) charge — but unpaid rent is a ground of forfeiture, and it blocks both Ministerial approval and registration under section 35(4). Either way, search for it.
Where to look for each
| What binds you | Provision | How to find it |
|---|---|---|
| Mortgages, registered leases, easements, caveats | 33(1)(b) | Title search of the Registrar’s folio |
| Tenancy of 3 years or less, or year to year | 33(1)(f) | Inspect and ask the occupier |
| Unregistered lease or agreement for lease, tenant in actual occupation | 33(1)(g), s 28 | Inspect; ask for the document |
| Lease, licence or authority from the Head of State or a Minister | 33(1)(h) | Ask the Department; ask the occupier |
| Rates, taxes and statutory charges | 33(1)(i) | Rates and land tax searches |
| Option to purchase or renew | s 28(3) | Binds only if registered or caveated |
What does not bind you
An unregistered, uncaveated interest of which you merely have notice. Under section 45(1) a transferee is not affected by actual or constructive notice except in case of fraud, and under section 24(1)(b) priority runs by date of production notwithstanding notice.
But note the qualification in section 45(1) itself: it is subject to section 28. Occupation is the thing to look for, not knowledge.
Sources
- Land Registration Act (Chapter 191) — ss 8, 11, 24, 25, 28, 33, 45, 49
- Land Act 1996 — ss 83, 122, 125, 126, 129
- Mudge v Secretary for Lands [1985] PGSC 13; [1985] PNGLR 387
- Papua Club Inc v Nasaum Holdings Ltd [2004] PGNC 178; N2603
Before relying on anything here, read the current text of the Land Act 1996 and check for later amendments. If a decision matters to you, get advice — start with the Office of the Public Solicitor, or find a firm in the law firms directory.