Tuesday, March 2, 2010 [ sunstar.com.ph ]
By Antonio V. Osmeña
IT WAS in the early 1900s that the United States adopted the Torrens System, which was enforced and evolved also in territories then under that country’s federal laws, like the Philippines, Hawaii, Guam and Puerto Rico. The following states have Torrens System laws: California, Illinois, Massachusetts, Ohio, Virginia, Georgia, Utah and South Dakota. The rest of the country adopted title insurance.
It is desirable to have a system of registration that accurately determines the ownership of a piece of land and all liens and claims upon it, records or registers these facts, and issues a certificate of the registration to the owner. The title registered is absolutely conclusive, and results are obtained speedily and cheaply. No system of title searching is perfect.
Errors may creep in, or forgeries and other things that cannot be guarded against may cause loss.
To remedy this situation, title insurance has come into use in most advanced countries. It is a direct growth of the abstract company. In Cebu, there are only two companies in the abstract business, A. Osmeña Realty Corp. and Trading Places Inc.
The laws on real property, especially in our country, are complicated and technical. The average person dealing in real estate has no knowledge of these rules, nor the time to examine the title. The right procedure is to employ a legal counsel or a conveyancer to do the work—someone familiar with the records, their location, indices and, most important, the laws applicable to the various situations that an examination of the title might reveal.
As the records in the country and other offices grow in size and complexity, it is safe to have searches made only by someone familiar with them. Specialists in this field of work are necessary. To a large extent, in the rural communities and even in the cities, a great deal of title searching is done by lawyers or conveyancers. In some places, the search is customarily done by men who make a specialty of making up abstracts and who supply them to lawyers on order. The lawyer then reads the abstract and certifies the title.
Throughout the history of title recording, means and ways have been sought to make the transfer of real property as simple and safe as the transfer of other property. The search for some permanent form of title registration is still prompted by the tedious and often difficult method by which titles change and, in addition, by the ever present fear that ownership of a farm or home may be invalidated by court order, because of faulty or illegal property transfer somewhere in the chain of title grantors.
Theoretically, it is necessary for each title examination to go back and study the records from the earliest recorded instruments. Legally, there is no date that can be fixed beyond which there is no need for going back to search a title. The lack of such a basic date, in brief, is the problem faced by title searchers. In practice, title and abstract companies usually “assume the title is good at some fairly early date.”
Here are some objections to the Torrens System. There can be no true Torrens System because any law making a registered title indefeasible violates the constitutional guarantee that no one shall be deprived of property without due process of law. Some person or persons, possibly infants, having rights to a property may, through error or oversight, not be named in the action to register the title and may not receive notice of it. Title registration is neither easy nor speedy.
The initial registration is not cheap. Recovery of compensation for damages is limited to the amount in the assurance fund.
Efforts should be made to amend the law to make the government liable for claims in full, regardless of the amount in the assurance fund. Upon the death of an owner of a registered property, a petition must be made to the court for an order directing registration of the title in the names of the heirs.
Under the law, the initial registration is by means of a judicial proceeding resulting in an order or judgment of a court, but the law permits the transfer of a registered title to be made by a registrar without notice to anyone.
Published in the Sun.Star Cebu newspaper on March 3, 2010.