08 Nov The land registry in Spain
Given that we are followed by numerous clients from outside Spain, we thought it would be interesting to disseminate this information, as it may reassure more than one investor who wants to do real estate business in Spain.
What is it and what is it for?
For the sake of clarity and rigour, we have selected a part of the description given by the Spanish Ministry of Justice itself. We could not have written it better.
The purpose of the Land Registry is the registration or annotation of acts, contracts and judicial or administrative resolutions that affect ownership and other rights over real estate, as well as certain judicial resolutions that affect the capacity of persons.
Funciones del Registro de la Propiedad.
The Land Registry registers acts affecting ownership or rights in rem over immovable property, whether publicly or privately owned. Certain administrative concessions and property in the public domain may also be registered.
It is responsible for providing legal certainty for registered rights, promotes the security and agility of legal transactions and saves management costs. It also makes the registered facts, acts and rights public for those who have a legitimate interest in knowing them.
Principles of operation of the Registry.
The principles governing the operation of the Land Registry are:
- Voluntariness: Access to the Land Register for registrable facts is voluntary, except in the case of mortgages, which must be registered in any case, as they do not exist without registration.
- Principle of rogation: whoever wishes to register a title must apply for it at the relevant registry.
- Priority: this means that in the event that two incompatible rights are to be registered, the one that arrives first at the Registry will be registered, and in the event that there are two rights registered on the same property, the oldest one will have priority. For example, a person goes to the Land Registry to register the contract by which he has acquired a property from another person, and then another person goes to the Registry and requests the registration of the contract by which he has acquired the same property from the same person as the first person who went to the Registry. In this case, the Registrar will register the acquisition of the first person who came to the Register. Another example could be that in the case of foreclosure of a mortgage or an earlier seizure, this may involve the cancellation of all subsequent rights.
- Legality: the Registrars are responsible for assessing the legality of the extrinsic forms of the documents of all kinds on the basis of which registration is requested, as well as the capacity of the grantors and the validity of the dispositive acts contained in the public deeds as they result from them and from the entries in the Register.
- Speciality: in order to be eligible for access to the Register, titles must meet the requirements of form and content in accordance with the terms established by law.
- Successive tract: in order to register or annotate titles, the right of the person granting it must be previously registered or annotated. In the event that the right is registered in favour of a person other than the person granting the transfer or encumbrance, the Registrars will refuse the registration requested.
In the event that the right is registered in favour of a person other than the person granting the transfer or encumbrance, the Registrars shall refuse the registration requested.
In the event that the immovable property to which the title whose registration or annotation is sought refers is not registered in favour of any person, the property must be immatriculated for the first time, by means of the mechanisms provided for by law.
Effects of the entry in the Land Register.
Entry in the Land Register has the following effects:
- Legitimation by registration: For all legal purposes it shall be presumed that registered rights in rem exist and belong to their owner in the manner determined by the respective entry. Likewise, it shall be presumed that whoever has registered ownership or rights in rem has possession of them.
- Non-opposability: Titles of ownership or other rights in rem over immovable property which are not duly registered or recorded in the Land Register do not prejudice third parties. For example, a person who acquires a right of usufruct (right of use and enjoyment) of a property cannot be prejudiced or deprived of his right by a title in which there is a right of usufruct in favour of another person if this right is not registered in the Land Register.
- Public faith in the Register: A person who in good faith acquires a right for valuable consideration from someone who appears in the Register to have the power to transfer it, will be maintained in his acquisition, once he has registered his right, even if the transferor’s right later turns out not to be valid for reasons that do not appear in the Register. For example, if a person acquires a property from another person who appears as the owner of the same in the Land Register, unaware that what is stated in the Register does not correspond to reality (this unawareness is always presumed), if the acquisition is onerous (not free) and the purchaser registers the sale in the Land Register, said purchaser will continue to be the owner even if it is later judicially declared that the person who transferred it did not have ownership of the property, for reasons that are not stated in the Register.
- Presumption of veracity: The entries by which deeds are registered in the Land Registry produce all their effects as long as they are not declared to be inaccurate. In other words, it is presumed that what is entered in the Land Register corresponds to reality until proven otherwise.
- Judicial safeguarding: The entries in the Register are under the safeguard of the Courts and produce all their effects until their inaccuracy is declared under the terms established by Law.
- Judicial protection of registered rights – Actions in rem deriving from registered rights may be brought by means of the lawsuit regulated in the Civil Procedure Act against those who, without a registered title, oppose such rights or disturb their exercise.
In short, it is a state body of maximum guarantee and legal rigour for the protection of property rights.
At Navarro Llima Abogados we are also specialists in Real Estate and Registry Law.
Pablo M. Félez Blasco
Doctor in Law and Lawyer at Navarro Llima Abogados.