Allodial title

Allodial title is a concept in some systems of property law. It describes a situation where real property (land, buildings and fixtures) is owned free and clear of any encumbrances, including liens, mortgages and tax obligations. Allodial title is inalienable, in that it cannot be taken by any operation of law for any reason whatsoever.

In common legal use, allodial title is used to distinguish absolute ownership of land by individuals from feudal ownership, where property ownership is dependent on relationship to a lord or the sovereign. Webster's first dictionary (1825 ed) says allodium is "land which is absolute property of the owner, real estate held in absolute independence, without being subject to any rent, service, or acknowledgement to a superior. It is thus opposed to "feud."

True allodial title is rare, with most property ownership in the common law world—primarily, the United Kingdom, the United States, Canada, Australia, New Zealand and the Republic of Ireland—described more properly as being in "fee simple". In particular, land is said to be "held of the Crown" in England and Wales and the Commonwealth realms. In England, there is no allodial land, all land being held of the Crown; even in the United States most lands are not allodial, as evidenced by the existence of property taxes. Some of the Commonwealth realms (particularly Australia) recognise native title, a form of allodial title that does not originate from a Crown grant.

In France, while allodial title existed before the French Revolution, it was rare and limited to ecclesiastical properties and property that had fallen out of feudal ownership. After the French Revolution allodial title became the norm in France and other civil law countries that were under Napoleonic legal influences. Interestingly Quebec adopted a form of allodial title when it abolished feudalism in the mid-nineteenth century making the forms of ownership in Upper and Lower Canada remarkably similar in substance.

Property owned under allodial title is referred to as allodial land, allodium, or an allod.

Legal concept

Allodial lands are the absolute property of their owner and not subject to any service or acknowledgment to a superior. An allodial title is the opposite of a feudal tenure such as fee simple. The derivation of the word is still doubtful, though it is probably compounded of the Germanic "all", whole or entire, and "odh", property. Allodial tenure seems to have been common throughout northern Europe, but is now unknown in common law jurisidictions apart from the United States. Allodial titles are known as udal tenure in Orkney and Shetland, the only parts of the United Kingdom of Great Britain and Northern Ireland where they exist.

Development of equitable title

As late as the Tudor period, in order to avoid estate taxes, a legal loophole was exploited where land was willed to a trustee for the use of the beneficiary. However, trustees often abused this privilege, and heirs found that the courts of common law would refuse to recognize the "use" clause, and would instead grant title in law to the trustee. However, the courts of equity, which were developed by the sovereign to deal with obvious injustices in the common law courts, ruled that the heirs were entitled to the use of the property, and gave them title in equity. As rulings of equity courts ranked above those of common law courts, this gave heirs the use of the land, but not title to it in the common law.

However, this distinction between common law and equity title helped develop forms of security based on the distinction, now known as the mortgage. Enjoyment of the property during the period where the mortgage was in good standing could be assured through the equity courts, while the right to foreclose on the property to merge the common law and equity title were guaranteed in the common law courts.

Proof of ownership

Until the 18th century, almost all common law property ownership depended on proving a link of possession from a royal grant of title to the property owner. Although the feudal system was rapidly disappearing from England in the 18th century, to be replaced with a system of taxation, in theory the feudal chain of title still exists, although it is a formality.

However, proving ownership in absence of the documents was an impossibility, and forgeries of crown grants were common and difficult to detect. Moreover, it was nearly impossible to determine if land was subject to common law encumbrances (i.e. mortgages). This led to the establishment in the 18th century of land registry systems, where a central office in each county was responsible for the filing of land deed, mortgages, liens and other evidence of ownership, transfer or encumbrance. Under land registry, deeds and charges were not recognized unless they were filed, and persons who filed were given priority over previous transactions that had not been filed. Moreover, under statutes of limitation, only documents that had been filed in the past 40 years had to be consulted to determine the chain of ownership.

Allodial title in the United States

In the United States, "To say that land is owned 'allodially' is a fiction, as all land under United States government jurisdiction is subject to expropriation by way of eminent domain", [http://www.kinsellalaw.com/publications/dictionary.pdf] though such governmental commandeering of territory or property is rare (except in the cases of property acquisitions made during drug raids and the like).

Before 1774, all land in the American colonies could also be traced to royal grants, usually one grant creating each colony. The original grantee then sold or granted parcels of land within their grant to private citizens and other legal entities. However, when the colonies won the Revolutionary War, they did not want to retain a feudal system of land ownership. The Treaty of Paris (1783), which ended formal hostilities and recognized American independence, also had the effect of ending any residual rights held by the original grantees or the Crown. Essentially, this merely recognized that no person holding land in the new United States owed any allegiance or duty to the Crown or any English noble. There is no specific reference to allodial title in the text of the treaty. Some states created a form of allodial title while others retained the tenurial system with the state as the new ultimate landholder.

Apart from land that was formally owned at the time of the Revolutionary War, most American landholders can trace their title back to grants by the federal or state governments of land obtained by purchase (Louisiana Purchase, Florida, Alaska), treaty (the Ohio Valley, New Mexico, Arizona, and California), or annexation (Texas, Hawaii). However, in reality, previous grants prior to those territories becoming U.S. possessions were recognized. In fact, in "Dartmouth College v. Woodward", the United States Supreme Court ruled a New Hampshire law that attempted to revoke the land grant to Dartmouth College from King George III was unconstitutional.

Many state constitutions (Arkansas, Wisconsin, Minnesota, New York) refer to allodial title, but only to clearly distinguish it from feudal title, which appears to be illegal throughout the United States. The conditions under which the government can compel the sale of privately owned real property for public benefit are established by eminent domain laws of either the federal or state governments, respectively. The Fifth Amendment to the United States Constitution requires just compensation for eminent domain compelled sale. The right to tax real estate is preserved in the Constitution though it is a right reserved for the states (i.e. via property taxes). In addition, the government powers of police power, and escheat have been retained in the American legal system.

Allodial title advocates

Many concerned groups are convinced that the references to allodial title in state constitutions and (allegedly) the Treaty of Paris give property owners absolute, inalienable title to their property. These people are generally stereotyped into these groups:

# Tax protesters. This group denies the right of municipal and state governments to tax property on the basis that allodial title cannot be alienated by failure to pay those taxes. However, most private property (to include all property in the United States) is not held in true allodial title, which would be the only title exempting the title holder from any tax.
# Mortgagors. Persons who have overextended themselves and face foreclosure often try to create an allodial title. As allodial title cannot be alienated by seizure by a creditor, they claim the foreclosure by the mortgagee is illegal. However, by its nature, allodial title cannot be mortgaged in the first place, and an attempt to create allodial title on land that is subject to encumbrance by debt is impossible. Actually a contract can be created by an owner of allodial property with a mortgagee resulting in the transfer of title under certain circumstances such as default on a loan, thus that land falls out of the allodial title domain as it is essentially jointly owned and governed by contract by both the mortgagee and mortgagor. Once the mortgagee releases the contract as satisfied in full, the ownership reverts entirely back to the owner. There was time when one was considered a fool to mortgage allodial land and thus give up allodial ownership as among other penalties the owner often lost the right of a freeholder to vote.
# Anti-Zoning groups. Persons who own agricultural land that faces re-zoning due to encroaching urbanization often claim that zoning laws that control agricultural use of property are illegal as they constitute an encumbrance on allodial title. They claim that only the law of nuisance applies to persons holding allodial title. However, the U.S. Supreme Court court has upheld the constitutionality of zoning laws on a very broad basis, even though such laws all post-date the 1787 Constitution.

Schemes to obtain allodial title usually advise property owners to file a deed of allodial title with the local registry office, or to publish a notice of allodial title in a local newspaper. However, neither these or any other method is recognised by U.S. courts, and attempts to improperly assert an allodial title in U.S. courts may be classified as a "frivolous claim".

Limited allodial title

Two states, Nevada and Texas, have created limited allodial title provisions in order to protect property owners from the burden of highly increased property taxes which often occur when unincorporated land becomes part of a town or city. However, the Nevada Legislature in 2005 prohibited applications by property owners for allodial title after June 13, 2005.

Nevada allows persons who own and live in single family residences to obtain allodial title on land they own if the land is free of mortgage and tax arrears. Nevada accepts a payment based on an actuarial calculation of the present value of the future property taxes payable given the age of the youngest person who holds title to the property. Once this amount is paid, a certificate of allodial title is granted. Property taxes owing are paid by the state treasurer from the funds paid to obtain the certificate. Allodial title is subject to exemptions from seizure in debt or bankruptcy under homestead laws, and the taxes are paid by the state treasurer as long as the original owner remains in the home. However, like the barons under Magna Carta, Nevada law still allows the seizure of property if it is used in a criminal enterprise.

Other institutional property ownership can also be called allodial, in that property granted for certain uses is held absolutely and cannot be alienated in most circumstances. For example, universities and colleges that hold property for educational purposes can be described as having allodial title. In most states, property held by churches for the purpose of worship also has status similar to allodial title. American Indian reservations also share some similarity with allodial title. However, in all these cases, it is also clear that if the title ceases to be used for the purposes for which it was granted, it reverts to the state or the federal government.

Difficulties with allodial title

Although allodial title cannot be lost in most circumstances, that also means that it cannot be transferred or encumbered without losing its allodial status. As such, when a property owner dies and leaves ownership to more than one heir, the allodial status of the property is lost. Allodial title cannot be mortgaged. Moreover, as liens cannot attach to allodial title, it is difficult to finance improvements to a property held in allodial title as, once incorporated, the improvements become part of the allodial title and become exempt from lien or seizure of the property to pay a contractor's bill.

Allodial title cannot, in theory, be legally taken away against the will of the owner. However, an allodial owner can contractually give up allodial ownership and that allodial ownership can be restored or sold or passed on to a single heir. Allodial title cannot be taken away by fraud, only by legitimate contract.

Notes

ee also

* Fee simple
* Land tenure
* Manorialism
* Odelsrett
* Udal law
* Native title
* Torrens title
* Numa Denis Fustel de Coulanges
* Mark system
* Quia Emptores

External links

* [http://www.paperadvantage.org/allodial.html Allodial title resources]
* [http://www.quatloos.com/taxscams/protcase/britt.htm Court case where mortgage holder did not have allodial title recognized by court and sanctions were applied] at quatloos.com
* [http://nevadatreasurer.gov/specialprograms/allodial/info.html Nevada Allodial Title] .