Susana Lastarria-Cornhiel, Grenville Barnes (1995):
Assessment of the Praedial Property Registration System in Peru

B. Immovable Property Registration Systems

In Peru and other Latin American countries a title is issued when land is granted or transferred from the state to a private party or community. This is essentially a contract between the government and the new landowner. However, this title does not protect the landowner against third party claims unless the title is registered in a public registry. In addition, most banks will require that a land parcel be registered as a pre-condition to using it as collateral. When the titleholder subsequently transfers the property this is typically done through a notarized sales contract which becomes a deed (escritura pública) and which serves as a title document.

Titling and registration are generally two distinct processes. Titling is usually undertaken by a government agency which has the legal jurisdiction to dispose of state land. Since the 1960s, land reform and/or colonization agencies have typically played this role in Latin America. In Peru, the provincial-level municipalities hold this responsibility in urban areas and the Ministry of Agriculture deals with the allocation of rural state lands. In several countries the President's Office is also involved since the president is required to sign each individual title. The fact that many titles highlight the president's name indicates the extent to which titling has been used a political vehicle for garnering the support of the poor.

Registration, on the other hand, is a process which gives publicity and security to land transactions. In many ways, registration or recordation is much more passive than titling since it acts as a collection house for documents affecting rights to land. The registration process may involve some form of notarization before a document is accepted in the registry. Documents, such as titles and deeds, entering the registry may be checked as to their completeness, validity, and consistency with previously registered documents. Registration may also involve the abstraction of details from the document to a central register. If no register exists, the process of registration may more accurately be referred to as recordation. Beyond this step, registration (or recordation) is essentially a matter of organizing, indexing, managing and archiving paper documents or computerized files.

The Registro Predial and the Registro de Propiedad Inmueble are the two offices responsible for registration in Peru and it should be noted that they do not deal with titling nor any of the adjudication (saneamiento) processes which may precede titling.

In the past, property registration systems have typically been categorized as either registration of deeds systems or registration of titles systems. The former systems focus on the deed as the primary evidence of property rights, whereas the titles systems rely on a register for this purpose. This categorization of registration systems into two "boxes" tends to oversimplify the understanding of these systems. It is more useful to view registration systems along a continuum with a basic deeds system at one end and a registration of titles system, such as the Torrens system, at the other end. This perspective promotes the appreciation of difference and similarities in systems and avoids problems of over-generalization.

A rudimentary registration of deeds system is one in which documents of conveyance (typically deeds) are deposited in a public office, such as a registry office or courthouse. No effort is made to check the quality of these documents or whether they are consistent with other documents deposited previously in the registry office. Generally, the land parcel involved in such a conveyance is defined in general terms by referring to the names of adjoining owners. A basic index to the documents is usually maintained using the name of the grantor (seller) or grantee (buyer) as the reference key. This type of system is common throughout Latin America.

Improvements may be made to a rudimentary system to improve the delivery of information and the security of the land rights. Such improvements may include:

• quality control checks on documents entering the system in order to raise the integrity of the registry information,
• indexing documents on a parcel basis by introducing a unique parcel identifier for each registered parcel,
• making it compulsory to register documents affecting legal rights to land,
• integrating survey data defining the spatial dimensions of the parcel with legal data defining the nature and basis of the land rights,
• limiting retrospective searches to prove title so that it is not necessary to trace back through the full "chain" of deeds to prove title,
• requiring a more standardized approach toward defining (surveying) the spatial dimensions of land parcels, and
• introduction of a register which contains details abstracted from the deed or document of conveyance.

While the central document of proof remains the deed in these "improved" registration of deeds systems, they begin to move the system along the continuum so that it starts to incorporate certain characteristics of the registration of titles systems.

Registration of titles systems were introduced to focus the system on answering the primary question which is asked from these systems, i.e., who has title to a particular piece of land. This information is typically contained in a register which identifies the titleholder (name, identification number, address, marital status, etc.), defines the subject parcel of land, and reflects any secondary rights or encumbrances on the parcel (e.g., liens, mortgages, easements). Typically, each parcel of land is associated with a specific page (or two) in the register. This essentially focuses the system on the parcel as a means of organizing the title information, as opposed to the person's name used in the deeds system.

The Torrens system is one of the most well known registration of title systems. Initially started in 1868 in South Australia, it has spread across Australasia and to many countries across the globe. One of the central principles of the Torrens system is that the title status of a parcel of land should be reflected directly in the register and it should not be necessary to carry out a retrospective search through previously registered documents to prove title. This system also provided for a state guarantee of the information in the registry. If a valid claim was brought against someone on the register, this guarantee would protect the rights of the person in the register and the state would compensate the claimant for his/her loss. The Torrens and most other registration of title systems make it compulsory to register land transactions.

Various versions of the Torrens system have been adopted in many different countries and the original system has evolved over the past century. This means that the term Torrens is actually applied to registration systems which may differ significantly from what was proposed and implemented in 1868 in Australia. Once again, this underlines the need to view registration systems on a continuum and to focus on the specific components and procedures inherent to each system.

The traditional Registro de Propiedad Inmueble system in Peru organizes the registration information on a parcel basis. In Latin America these systems are termed folio real. This is an improvement over the more rudimentary registration of deeds system which is based on personal indices (i.e., the information is keyed to the grantee and/or grantor). The Registro de Propiedad Inmueble for the Region of Lima introduced this improvement in 1970 and appears to operate fairly well even though they are not computerized. [FN 4]

Surprisingly, the new Registro Predial in Peru is also still based primarily on the principles of the registration of deeds system even though the general trend internationally has been toward title systems, or at least to the attributes associated with this system. The cumbersomeness of the title search becomes less of an issue when some of the information on archived documents is computerized, but it does slow down the computerization process since historical information has to be included in the database. In Peru this may involve extremely old deeds, especially where land has not been conveyed in the last ten years. In any event, a registration system that deals primarily with current information will always be more efficient than one that is forced to carry historical baggage.

Even though the Peruvian system is based on the deed registration system, the concept of proving title did not appear to be familiar to most of the Registro Predial personnel, suggesting that very few title searches (estudio de título) are actually done. In part this may be due to the high proportion of parcels that are being titled for the first time. However, given the large number of transactions of already-titled land in the Registro Predial, this does not fully explain the absence of title searches.