Law of Property (Miscellaneous Provisions) Act 1994

A word about credit risk mitigation Go Premium Legal security: Mortgage • Pledge • Lien • Bailment Equitable security: Charge • fixed • floating | ABWOS | Equitable lien Credit risk mitigation: Title transfer | Guarantee | Letter of credit | Netting Friends and relations: Rehypothecation | Equivalent Documents: 1994 NY CSA | 1995 CSA | 1995 ISDA CSD (English law) Regulation: LPA 1925 | Financial Collateral Regulations | LPMPA 1994 Index: Click ᐅ to expand: Taking security Security Collateral Comments? Questions? Suggestions? Requests? Insults? We’d love to 📧 hear from you. Sign up for our newsletter.

One of those innocuous-sounding, understated, quintessentially British statutes that actually does some fairly important work.

It is this little fellow whom we can thank for vouchsafing to us the expression “full title guarantee” and its less fashionable, seldom-uttered brother “limited title guarantee”. In it, “property” includes intangible rights and similar things in action.

also, it implies a covenant, in Section 3(1), that

3(1) If the disposition is expressed to be made with full title guarantee there shall be implied a covenant that the person making the disposition is disposing of the property free—

(a) from all charges and incumbrances (whether monetary or not), and

(b) from all other rights exercisable by third parties,

other than any charges, incumbrances or rights which that person does not and could not reasonably be expected to know about.

It is not unknown for chargees to try to widen this implied covenant to delete the caveat about no actual or constructive knowledge. Which seems a bit harsh.

See also

text of the legislation