The failure of the Torrens System in the United States of America

Abstract

The aim of this article is to study the reasons for the failure of the Torrens system in the USA. At the beginning of the 20^th Century there were Torrens Laws in nineteen States but today they are in force in only four. The paper points out that the reason for the failure is not only due to vested interests but it also goes further about the mistakes in the basic design specially in the state of NY.

The first claims against that the Torrens System were based on its constitutionality because it was said not to respect due process of law. This resulted in several declarations from state constitutional courts and numerous legal academic studies which showed a high level of understanding of the effects of setting up a title system.

The mistaken design which lead to the failure of the registration system, especially in NY was due to: 1) the expense and complexity of the procedures for the first registration; 2) the mistakes made in the procedure to examine the titles and the organization of human capital; 3) the inadequate regulation of the insurance fund; and 4) the possibility to withdraw the property titles which was a claim of those against the enemies of the system against the advice made by Robert Torrens himself.

There is also a reflection on those against setting up or developing land registration systems to show that these people are not only a special characteristic of the US. The article concludes with some ideas about the consequences and costs of not choosing an appropriate Land Registration system.