Under the Long Leases (Scotland) Act 2012, as from 28 November 2015, tenants under qualifying long leases become the outright owner of the leased property, generally without payment to the current owner, and on successful completion of the proper process.
There are some exceptions, but a qualifying lease must:
- be registered in the Land Register of Scotland or Register of Sasines;
- have a term of over 175 years - and in relation to a private dwelling house have at least 100 years run and for all other properties at least 175 years left to run; and
- have an annual rent of £100 or less.
For further commentary on the Act and on qualifying leases and exceptions, please see our previous Law-Now article.
The Registers of Scotland do not automatically update affected titles, and formal application needs to be made to the Registers to reflect a conversion. The relevant application is a ‘Notification of Inaccuracy in the Register’. This application notifies the Registers that the Title Sheet is not up to date, and requires to be amended to show the holder of the former long leasehold interest as the new outright owner.
In updating the Title Sheet, the Registers will carry forward all existing title conditions to the new title, and if there are any other conditions specific to the lease (other than payment of rent) those will also be disclosed on the new Title Sheet as title conditions, even though they may no longer be enforceable.
If there are additional rights included within the lease which are not already included on the Title Sheet, and which the Act has converted into servitude rights (easements), those must be specifically referenced when the application is submitted. These would include, for example, rights of access.