Guaranteeing title to land

Published July 22, 2002

THE AGRARIAN systems and land policies prevailing in South-East Asia, including Pakistan had long been subject to colonial rule, are not only identical in essential details, but also their laws relating to ownership rights in land and security of tenure, suffer similar drawbacks and legal infirmities.

In view of the defective agrarian laws providing for no clear records of rights in land, the powerful people in these countries enjoy maximum discretion to grab land and dispossess the poor from their holdings, pushing them continually into incessant land disputes. This insecurity of land tenure poses a permanent threat to the sustainable development of agriculture, forestry and livestock sectors.

Land is admittedly the most important economic asset in an agricultural economy. This makes it obvious that rights to land should be embedded in an unambiguous and authoritative law, should be efficiently recorded, should be capable of being transferred smoothly, and should lend themselves to verification in a definitive manner.

Situation in Pakistan: The situation, unfortunately, of agrarian laws of Pakistan as to title to land, as also of factual position concerning records-of-rights and their accuracy, like those of the countries of South-East Asia, is not very ideal. In fact, the laws of Pakistan dealing with land administration almost entirely belong to the British period, when the emperor was presumed to be the proprietor of all lands, and the rights of an individual to hold his land were subject to payment by him of land-revenue. The two foremost law enacted during this period were the Bombay (Sindh) Land Revenue Code, 1879, and the Punjab Land Revenue Act, 1887, which have since been unified into one integrated law called the West Pakistan Land Revenue Act, 1967. Sections 42-45 of the new Act enumerate the rights, the acquisition or loss of which gives rise to an alteration in the records-of-rights and the mutation procedure. Section 52 of the Act attaches the presumption of correctness to the records-of-rights prepared at a settlement, as also to any entry made in the records-of-rights or in the periodical records in accordance with the provisions laid down in sections 42-45 and the rules thereunder.

This law, as in force, at present, does not profess to provide for a State certificate of title to land under the aegis of a public authority. No doubt that in regard to the agriculture land, the records-of-rights and similar documents, by virtue of provisions in the land laws create a structure, at least in theory, of permanent records of transactions concerning such land. But the entries in such records are not conclusive, even though they may be relevant in a court of law, and may be given a presumptive status by land laws. It may be useful to refer, in this regard, to the decision of the Lahore high Court (PLD 196 Lah 764) holding “that entries in revenue record are not sacrosanct. They are certainly an important piece of evidence but like all other evidence they can be countered”. Similarly, the Supreme Court of India, as late as August 1989, has firmly established, in Corporation of they City of Bangalore vs. M. Papaiah and another, (judgment Today, 1989(3) Sc 294 Page 296) “that the revenue records are not the documents of title ...”. Thus, whatever be the entry in the records-of-rights, it would permissible to challenge it in the appropriate court or tribunal. Another law, which is seen as anachronism in the present-day circumstances, is the Colonization of Government Lands Act, 1912, under which a grantee of state land, notwithstanding acquisition of the ownership rights in such land and the entry made thereabout in his name in the records-of-rights, continues to be bound by the conditions set out in Schedule II of the Act. Such conditions as provided in Section 3 of the Crown Grants Act, 1895, shall hold valid and take effect according to their tenor, any rule of law, statute or enactment of the legislation to the contrary notwithstanding.

Law of Evidence: Our Law of Evidence, particularly, in Sections 46 and 49 of the Qanun-e-Shahadat Order, 1984, goes out of its way to attach special importance to the evidentiary value of public records. It envisages a special procedure for the inspection of public documents and of obtaining certified copies thereof. Underlying all these special provisions is the assumption that public registers and other documents would be accurate. This assumption has so many branches; the legal system assumes that the public records are prepared carefully after verification of the facts; that they are maintained accurately by reflecting changes, whenever those changes take place; and that, in general, they are faithful to the external world and the transactions and events therein, which they seek to preserve for posterity. It is undeniable that these presumptions fall to the ground if the records are not properly revised from time to time. After all, a public record of a private transaction is the written reflection of something that took place between private parties. Juristic theory labels such private transaction as “acts in the law”, while it calls the public records themselves as “acts of the sovereign”. The two are interlined and should harmonize with each other. If that desideratum is not fulfilled, then they very justifiability of statutory provisions of the law of evidence falls to the ground.

The Registration Act: The Registration Act, 1908, provides for the registration of documents but not for the registration of titles. The registration of documents is compulsory in some cases and voluntary in others. It is compulsory where some provision in the Transfer of Property Act (for example, Section 54 in the case of an outright sale of an immovable property) or some provision in the Registration Act (for example, Section 17 dealing with various transactions concerning immovable property) provides for compulsory registration. In all other cases, unless provided by a special law, registration of documents is optional, particularly in the case of wills. The registering officer is not supposed to concern himself with the validity of the document.

Present State of Records-of-Rights in Land: There are common complaints in all parts of the country that the records relating to land are in a very bad shape. The agricultural land in many areas is still recorded in the name of a person who died long ago and whose legal successors are the owners but their names are not entered in the records. A similar highly unsatisfactory feature exists in respect of the situation of transfer of lands by act of parties. Land may go on being transferred, without quick consequential mutations in the record, so that the record as it exists and continues to exist today hardly reflects the present-day reality regarding ownership of the land. Thousands of cases of mutations and divisions of shares are pending with the revenue officials. Many more other cases in which the Government, the public bodies and the private persons in whose names the lands stand in the records-of-rights are not in possession of those lands. On the other hand, the names of the persons who possess those lands do not figure in the records-of-rights as owners. This disharmony between the record and the reality not only destroys the utility of the record but also misleads the person who has to deal with the land. No wonder this unhappy situation has led to incessant litigation and clogging of the judicial machinery.

Possible Remedies: In many countries, the position has since been improved by reform of the law of property. Two possible remedies, in this connection, have been thought of. The first is a change from the system of registration of deeds to the system of registration of titles to land — commonly known as the Torrens System. The system requires registration of title to land under the authority of government and issuance of an official certificate of title to land showing the state of the title and the person in whom the title is vested.

The main features of this system are:

a) Achievement of certainty of title to land, and

b) Simplification of conveyancing relating to land.

Certainty of title is achieved by certifying and guaranteeing, by the State, the validity of title to Certainty of title is achieved by certifying and guaranteeing, by the State, the validity of title to land. Once the title of a person is registered by the State, the title of the registered person becomes paramount, subject to certain specified exceptions. The purchaser of the land registered under the system need not go behind the certificate.

The alternative remedy is the practice of arranging for the Title Insurance. Such insurance, which offers a guarantee for the title is normally issued by title companies that maintain elaborate records to keep current information on all the properties under their surveyance. For such insurance, the premium is based on the expenses of maintaining the records. When the property is transferred again, a new policy must be issued and a new premium has to be paid. Broadly speaking, title insurance is a contract guaranteeing the purchaser of a real estate against loss from undiscovered defects in the title to the property that has been purchased.

Nevertheless, the real estate transactions are complex and technical. A small legal error may cause a defect in the title and impair its marketability. Some of the important circumstances giving rise to such a defect are forgeries, invalid or undiscovered wills, defective probate proceedings, and transfers of properties by persons who would not have full legal capacity to contract. Besides, a title insurance policy excludes any loss that stems from a defect existed in the public record. In other words, it covers only losses caused by defects in the title that have already occurred, but are not known when the policy is issued.

In view of these disadvantages, the title insurance transactions, being more complex and costly, are not likely to gain ground in our rural society.

Need for Registration of Title to Land: The need for registration of title to land has arisen because the existing law is no longer able to cope with new conditions and requirements. The present law and the records-of-rights prepared thereunder are fiscal in nature. The person shown on the records as responsible for paying land revenue for a particular khasra number is presumed to be the owner of such khasra number unless it is proved otherwise. Thus title to land is only incidental and springs from the presumption that whosoever pays land revenue is the owner. With the abolition of land revenue on small holdings, it is feared by the landowners that this presumption has been taken away from them. The registration of title will dispel this fear, therefore it should be welcomed by the landowners. Furthermore, it will serve an important document to get credit and other facilities on the security of landholding.

Broad Proposals: It would seem that time has come for gradual, phased and well-planned changeover to the system of registration of title to land.The models available on the basis of Torrens System of so many countries are there to make a selection out of them, having regard to the system of land rights in Pakistan, the legislative framework now existing, the administrative considerations and other relevant factors.

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