Learning Outcomes
After reading this article, you will be able to identify and apply the key legal and practical steps required before completing a freehold property transaction. You will understand the process of deduction and investigation of title, know what documentary evidence must be obtained and provided, and recognize the checks and risk management required prior to completion—necessary knowledge for advising clients and succeeding in SQE2 assessments.
SQE2 Syllabus
For SQE2, you are required to handle freehold real estate matters by recognizing and carrying out the pre-completion stage in a property transaction. In your revision, focus especially on:
- the steps and checks involved in deduction and investigation of title in freehold sales
- ensuring the seller is able to prove good title and that the buyer is properly protected
- understanding what constitutes good root of title and what documents should be provided
- Land Registry and other compliance requirements for completion
- risk management and client due diligence in the pre-completion phase.
Test Your Knowledge
Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.
- What is "deduction of title" and whose responsibility is it in a freehold property transaction?
- Why must a seller provide an “unbroken chain” of title deeds, and what is meant by a “good root of title”?
- Is proof of title alone enough for a buyer’s solicitor to recommend proceeding to exchange of contracts? What else should be checked?
- True or false? A valid transfer deed alone is always sufficient to register a change of ownership at the Land Registry.
- Name one common risk if a title investigation fails to identify an undisclosed restrictive covenant.
Introduction
The pre-completion stage of a freehold real estate transaction is critical. Before the legal title is transferred and the balance of the purchase price is paid, both the seller and buyer—through their solicitors—must complete a detailed process of deduction and investigation of title. The goals are to establish that the seller can sell the property, to expose any risks or problems, and to ensure that the buyer will acquire good and marketable title, free from undisclosed third-party interests. Proper handling of these requirements is essential in practice and required for SQE2 success.
The Purpose of Pre-Completion Steps
Before completion, the seller's solicitor must supply the buyer's solicitor with evidence proving that the seller has the legal right to sell, that the ownership history is sound, and that the property is free from undisclosed rights or burdens that might impact value or intended use.
Key Term: deduction of title
The process by which a seller’s solicitor provides documentary evidence (deeds and documents) demonstrating the seller’s legal right to sell the property.Key Term: investigation of title
The process by which the buyer’s solicitor checks the documents supplied to confirm the seller’s right to sell, to uncover title defects, and to identify practical risks (such as third-party rights or disputes).
Documentary Evidence and Good Root of Title
The seller must produce a set of title documents, known as an “epitome of title” (in unregistered land) or up-to-date official copies from the Land Registry (in registered land).
Key Term: good root of title
A deed or document (usually at least 15 years old for unregistered land) showing ownership of the whole legal and beneficial interest in the property, with nothing casting doubt on the title, forming the starting point for a chain of ownership up to the present seller.
Typical Document Checks and Chain of Title
In unregistered land, the seller’s solicitor prepares a schedule of documents—starting with the good root and ending with the latest transfer or deed. Each transfer, charge, or mortgage must be properly executed, and the sequence must be unbroken and easily traceable. In registered land, official copies are obtained from the Land Registry and should include the property register, proprietorship register, charges register, and the title plan.
The buyer's solicitor must carefully analyze these documents to:
- ensure each transfer is properly executed (signed, witnessed, sealed if relevant);
- ensure continuity of ownership, including dealing with deaths and changes of name;
- check for restrictive covenants, easements, mortgages, or other interests affecting the title;
- ensure any burdens (such as rights of way, leases, or other encumbrances) are accurately revealed and, if required, resolved.
Additional Checks: Identity, Consents, and Instructions
Alongside title investigation, the pre-completion phase requires the solicitors to:
- confirm the client’s identity and right to sell or purchase (to satisfy anti-money laundering and ‘know your client’ requirements);
- ensure that any necessary third-party consents (such as mortgagee consents, landlord consents, or trustee approvals) have been obtained;
- verify that any missing documents (especially for the root of title or key rights) have been located or rectified.
Worked Example 1.1
A solicitor is acting for a buyer purchasing a freehold house. The seller provides a series of deeds tracing ownership from 2006 to date, but the earliest document is a deed of gift (no money paid) transferring the house to the seller’s mother in 2006. Does this document serve as a good root of title, and what further investigation is required?
Answer:
No, a deed of gift is not normally acceptable as a good root of title because there is no guarantee that the title was thoroughly checked at the time. A purchase for value—such as a sale or mortgage—is preferred. The solicitor should request a deed showing a sale (for value) going back at least 15 years, or further, to ensure a reliable root of title and unbroken chain of ownership.
Worked Example 1.2
The documents provided include a mortgage deed, but there is no evidence of its discharge. What steps should the buyer’s solicitor take before proceeding?
Answer:
The buyer’s solicitor must raise an enquiry asking for evidence that the mortgage has been paid in full and legally discharged—usually either a written receipt or formal discharge from the lender (or, if registered land, a removal from the Land Registry charges register). This protects the buyer from the risk of the mortgagee later asserting an interest against the property.
Key Pre-Completion Risk Management
The pre-completion process is not just about paper-checking. Both solicitors must guard their clients’ interests by assessing risks such as:
- undisclosed covenants, easements, or leases;
- adverse third party claims;
- forged documents or gaps in the chain of title;
- unknown occupiers or beneficiaries asserting rights.
These risks must be managed by careful investigation, raising clear requisitions (questions) on title, and ensuring written replies are satisfactorily resolved before exchange and completion.
Dealing with Registered and Unregistered Land
- In unregistered land, the good root of title and all subsequent documents must be submitted and checked. Any link in the chain that refers to missing documents or parties must be accounted for, and searches against previous owners’ names for bankruptcies or land charges may also be required.
- In registered land, up-to-date Land Registry official copies, ancillary documents (such as copies of any filed plans, leases, charges, restrictive covenants, or easements noted on the register), and proof of identity and execution are reviewed.
Revision Tip
Before recommending proceeding to exchange and completion, always ensure that all seller and third-party consents are in place, the root of title documents are sound and complete, and all pre-completion requisitions have been raised and fully answered.
Exam Warning
Do not assume that a valid contract for sale guarantees the buyer’s right to be registered at the Land Registry. The transfer deed must be in valid form and title investigation must confirm that the seller can validly transfer legal title. Failure to do so risks rejected registration and professional negligence.
Key Point Checklist
This article has covered the following key knowledge points:
- The seller’s solicitor must provide proof of good and marketable title, starting with a reliable good root of title and an unbroken chain of documents or up-to-date Land Registry official copies.
- The buyer’s solicitor must investigate title by analyzing documents, raising requisitions, and resolving any issues before recommending exchange or completion.
- Checks must cover: execution and validity of documents, existence of third-party rights or burdens, proper discharge of mortgages and consents, and compliance with documentary and registration requirements.
- Inadequate title investigation or missing documentation can result in the buyer failing to gain marketable title, legal disputes, or inability to register ownership.
- Risk management and due diligence must be rigorous in the pre-completion stage to protect the client’s position and comply with professional obligations.
Key Terms and Concepts
- deduction of title
- investigation of title
- good root of title