Real Estate 2019

Author:Mr Diarmuid Mawe and Craig Kenny
Profession:Maples Group
 
FREE EXCERPT

1 REAL ESTATE LAW

1.1 Please briefly describe the main laws that govern real estate in your jurisdiction. Laws relating to leases of business premises should be listed in response to question 10.1. Those relating to zoning and environmental should be listed in response to question 12.1. Those relating to tax should be listed in response to questions in Section 9.

Irish law was historically based on old legislation which predates the establishment of the Irish State in 1922, such as the Conveyancing Acts, 1881-1911 (the "Conveyancing Acts") and the Settled Land Acts, 1882-1890. The Land and Conveyancing Law Reform Act, 2009 (the "2009 Act") replaced much of the old law, including the pre-1922 statute law, and modernised the law and conveyancing practice. There is modern legislation governing registration of title (Registration of Title Act, 1964 (the "1964 Act") which was modified by the Registration of Deeds and Title Act, 2006 (the "2006 Act")) to facilitate the increasing computerisation of the property registration system in this jurisdiction and succession law (Succession Act, 1965).

There is extensive statutory protection afforded to family property in particular, which affects conveyancing practice (e.g. the Family Home Protection Act, 1976). This is partly due to the fact that Ireland has a written Constitution enshrining certain fundamental rights which override any other law, including legislation. Thus it is not uncommon to find legislation declared by the domestic courts to be unconstitutional and, therefore, null and void.

1.2 What is the impact (if any) on real estate of local common law in your jurisdiction?

Irish property law is essentially based on both legislation and common law.

1.3 Are international laws relevant to real estate in your jurisdiction? Please ignore EU legislation enacted locally in EU countries.

There are no international laws of direct relevance to real estate in this jurisdiction. However, as Ireland is a common law jurisdiction, court decisions made in other common law jurisdictions (such as the UK) are often accepted as having persuasive authority by the Irish judiciary.

2 OWNERSHIP

2.1 Are there legal restrictions on ownership of real estate by particular classes of persons (e.g. non-resident persons)?

There are no legal restrictions on the ownership of real estate by non-resident persons in this jurisdiction. However, anti-money laundering legislation requires that a number of checks be carried out on a potential buyer, and the identity of the buyer, the source of funds and the ability to fund the acquisition of real estate will need to be verified.

3 REAL ESTATE RIGHTS

3.1 What are the types of rights over land recognised in your jurisdiction? Are any of them purely contractual between the parties?

Irish property can be held under freehold title which confers absolute ownership, or a leasehold title which confers ownership for the period of years granted by the relevant lease and held from the owner of the freehold or the owner of the superior leasehold title in the relevant property. A leasehold interest is based on a contractual relationship between the lessor/landlord and the lessee/tenant.

The quality of the title to land generally falls into four categories, namely:

Absolute title. Possessory title. Qualified title. Good Leasehold title. 3.2 Are there any scenarios where the right to land diverges from the right to a building constructed thereon?

Real estate in Ireland comprises all immovable property. This includes land and any buildings or fixtures on the land. No distinction is made between title to land and title to buildings where they are in the same ownership. Typically, the owner of land is also the owner of any buildings erected on the land. However, there is no impediment to having different owners.

3.3 Is there a split between legal title and beneficial title in your jurisdiction and what are the registration consequences of any split? Are there any proposals to change this?

There is a split between legal title and beneficial ownership of property in Ireland. The 2009 Act provides that the entire beneficial interest in property passes to the buyer on the making of an enforceable contract for the sale or other disposition of land. The beneficial interest in property can also be held through a traditional "off-title" trust.

In respect of registered land, the Land Registry does not recognise a split between legal title and beneficial ownership and only the legal owner of property will be recorded in part 2 (the ownership section) of the folio. A beneficial owner may, however, protect his or her interest in the property by registering a caution or an inhibition against the folio in question. The purpose of a caution is to obtain notice of dealings by the registered owner so that the cautioner has an opportunity to assert his or her unregistered right(s). An inhibition, on the other hand, operates as a restriction on registration that prevents all registrations except those made in compliance with the terms thereof.

There are currently no proposals to change the split between legal title and beneficial ownership of property in Ireland.

4 SYSTEM OF REGISTRATION

4.1 Is all land in your jurisdiction required to be registered? What land (or rights) are unregistered?

The Property Registration Authority (the "PRA") is the State body responsible for the registration of property transactions in Ireland and the system of registration of title (ownership) to land in Ireland.

The PRA is a statutory body established on 4 November 2006 under the provisions of the 2006 Act.

The main functions of the PRA are to manage and control the Land Registry and the Registry of Deeds and to promote and extend the registration of ownership of land.

The Land Registry was established in 1892. When ownership is registered in the Land Registry, the deeds are filed with the Land Registry and all relevant particulars concerning the property and its ownership are entered on folios which form the registers maintained in the Land Registry. In conjunction with folios, the Land Registry also maintains maps (referred to as filed plans). Both folios and maps are maintained in electronic form.

The Registry of Deeds was established in 1707 to provide a system of voluntary registration for deeds affecting land and to give priority to registered deeds over unregistered but registrable deeds. There is no statutory requirement to register a document in the Registry of Deeds, but failure to do so may result in a loss of priority. The effect of registration is generally to govern priorities between documents dealing with the same piece of land. The primary function of the Registry of Deeds is to provide a system of recording the existence of deeds affecting unregistered property. When a deed is lodged in the Registry of Deeds it must be accompanied by the relevant application form (in a prescribed form) which is a summary of the essential information of the relevant deed.

4.2 Is there a state guarantee of title? What does it guarantee?

A title registered in the Land Registry is guaranteed by the state. The Land Registry indemnifies any person who suffers loss through a mistake made by the Land Registry. A buyer, therefore, can accept the folio as evidence of title without having to read the relevant deeds. However, the State does not guarantee the conclusiveness of boundaries or the area of the relevant property as identified on the Land Registry maps.

It should be noted that the Registry of Deeds does not guarantee the effectiveness of a deed nor does it interpret a deed, but only records the existence of the deed. The registration of a deed in the Registry of Deeds governs priorities.

4.3 What rights in land are compulsory registrable? What (if any) is the consequence of non-registration?

Any unregistered property (Registry of Deeds) purchased in the State after 1 June 2011 is subject to compulsory first registration in the Land Registry.

Registration is also compulsory where land is bought under the Land Purchase Acts or where land is acquired after 1 January 1967 by a statutory authority.

4.4 What rights in land are not required to be registered?

Except as set out in question 4.3, there is no requirement that documents or titles be registered, but it is good conveyancing practice that deeds be registered in either the Registry of Deeds or the Land Registry in order to preserve the priority of the deed.

In the case of registered land, there are certain rights which must be registered in the Land Registry to gain protection; otherwise these rights will not be protected against a bona fide buyer for value without notice (e.g. rights of residence, restrictive covenants, leases for a term exceeding 21 years). Section 35 of the 2009 Act provides that an easement shall be acquired at law by prescription only on registration of a court order under section 35. Section 35(4) of the 2009 Act provides that the order shall then be registered in the Registry of Deeds or Land Registry as appropriate.

Section 37 Civil Law (Miscellaneous Provisions) Act 2011 amended the 2009 Act and the 1964 Act to enable the PRA to register easements without a court order where there is no disagreement between the parties concerning entitlement to an easement or profit.

There are also a number of burdens which affect registered land without registration, such as public rights and occupational tenancies for terms not exceeding 21 years.

4.5 Where there are both unregistered and registered land or rights is there a probationary period following first registration or are there perhaps different classes or qualities of title on first registration? Please give details. First registration means the occasion upon which unregistered land or rights are first registered in the registries.

There is no probationary period following first registration.

As noted at question 3.1, the quality of the title to registered land...

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