In Hawaii, there are two systems for recording real property ownership: the Land Court system (Torrens system) and the Regular system (also known as the "Land Court Dual System" or "Land Court Assurance System"). These systems differ in their procedures, requirements, and levels of complexity. Let's explore the main differences between the Land Court and Regular System:
Land Court System (Torrens System):
Origin: The Land Court system is based on the Torrens system of land registration, which was developed in Australia and adopted in Hawaii in 1903. The primary goal of this system is to provide a conclusive and guaranteed title to registered land.
Title Registration: In the Land Court system, the government maintains a centralized registry where all land titles are registered and given a unique Torrens title number. Each title is subject to a Certificate of Title (CT) issued by the Land Court, which serves as conclusive proof of ownership.
Title Guarantee: The Land Court system provides a high level of assurance regarding ownership, as the government guarantees the accuracy and validity of the registered title. Any disputes or conflicting claims are resolved through the Land Court, ensuring clear ownership records.
Abstract System: In the Land Court system, the ownership history of a property is condensed into a concise legal description called an "Abstract." This abstract outlines the complete chain of ownership, making it easier to verify and transfer ownership.
Regular System (Land Court Dual System):
Origin: The Regular System, also known as the Land Court Dual System, was established in Hawaii in 1903 alongside the Land Court system. It operates under traditional recording principles and is less rigid than the Land Court system.
Title Registration: In the Regular System, deeds and other real estate documents are recorded in the Bureau of Conveyances, and ownership is proven by presenting a sequence of recorded documents. Unlike the Land Court system, there is no government-issued Certificate of Title in the Regular System.
Title Assurance: The Regular System provides less assurance compared to the Land Court system, as it relies on the accuracy and completeness of recorded documents. Title issues may arise if there are missing or incomplete records or if disputes arise over the chain of ownership.
Abstract vs. Torrens Title: Unlike the Land Court system, the Regular System does not use abstracts or Torrens title numbers. Instead, property descriptions are based on metes and bounds or lot numbers within a subdivision.
Which System Should You Choose? The choice between the Land Court system and the Regular System typically depends on the history of the property and the owner's preferences. Properties originally registered under the Land Court system may remain in that system, while other properties are more commonly recorded in the Regular System.
It's crucial to consult with a knowledgeable real estate attorney or a title professional to determine the best system for recording your real property based on your specific circumstances and needs. Both systems offer advantages and drawbacks, and ensuring a clear and valid title is essential to protect your property investment in Hawaii.