Is your land title limited as to parcels? Where is your boundary?

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In New Zealand we have an expectation that the boundaries of land we own are precisely defined. Generally that is the case. We are fortunate to have one of the most advanced land survey systems in the world. However, there are quite a number of titles that are “limited as to parcels”.

Our land titles system is known as the Torrens system. The name derives from Sir Robert Torrens who was the Premier of South Australia in the 1850’s. Torrens devised the system where each title to land recorded in the land titles office was guaranteed by the state. This avoided the old uncertainties and costs associated with a deeds title system where title had depended on registration of deeds showing an unbroken chain of ownership back to an original authentic basis of title. The basic principle of the Torrens system is the concept of indefeasibility of title. An interest in land which is registered in the land titles office cannot be defeated by any other claimant. In the unlikely event that the registered owner loses an interest as a result of fraud, then the state will pay compensation for the loss. In New Zealand the land title system is also based on a cadastral survey system so the guarantee of title extends to the guarantee of the accuracy of the land area and boundaries as shown in the underlying survey.

It is in relation to the survey of land that the concept of a “limitation as to parcels” has arisen. As land was brought under the land transfer system and titles issued from the land titles office, some titles were not surveyed with sufficient certainty to meet the required survey standard. The titles in such cases were issued as titles “limited as to parcels”. So the ownership of land that has a title limited as to parcels still has the benefit of indefeasibility of title but the State guarantee of the title does not extend to the actual land area or accuracy of boundaries.

The limitations as to parcels can be removed by the completion of a survey of the land. This will involve the surveyor working off the plans that are available and looking at evidence as to where the boundaries between titles have been located. The actual occupation of the land can be relevant in resolving any uncertainties. Old fence lines or posts or other evidence of occupation may be relevant. Generally on completing such a survey, any variation in the title boundaries and land area is minimal but there can certainly be quite a change particularly if the blocks of land are large. Before a new unlimited title is issued on the basis of a new survey, the survey office generally requires the adjoining owners to consent to the new definition of the boundaries or the adjoining owners are given the right to object to the survey.

Many people have owned titles limited as to parcels for many years and the limitation has not given rise to any practical issues. However, there are some situations where a new survey to remove the limitations would be advisable or necessary. If for example a substantial structure was to be built near a limited boundary, it would be advisable to have the survey updated to ensure the building is not too close to the boundary or will not encroach over the boundary. If the property is to be further subdivided or used for the construction of units for which Unit Titles or cross lease titles are to be issued, the prior removal of the underlying title limitations will be required. So if you are intending to purchase land with a limited title you will be wise to consider the possible cost of having the property resurveyed.

Not only can titles be limited as to parcels, there are a few titles that are limited as to title, but that is another story…..