Define: Limited Owners Charge

Limited owner’s charge typically refers to a restriction or encumbrance placed on a property title that limits the owner’s ability to use or transfer the property. This charge may arise in various contexts, such as mortgages, liens, or easements, and it can impact the owner’s rights and obligations regarding the property. For example, a limited owner’s charge may restrict the owner from selling or mortgaging the property without obtaining consent from the charge holder or fulfiling certain conditions specified in the charge agreement. Limited owner’s charges are often recorded in the property’s title deeds or land registry documents to provide notice to potential buyers or creditors. It is important for property owners to understand any limited owner’s charges associated with their property and to comply with any requirements or restrictions imposed by these charges to avoid legal disputes or complications.

A limited owner’s charge is a rather rare equitable interest in land. It arises when a person who takes a Freehold estate in land does so as the Tenant For Life under a settled land act settlement. Because the tenant for life becomes the legal owner of the estate, the burden of inheritance tax falls on him or her, even though the tenant for life is only the owner for administrative convenience. In reality, the tenant for life is effectively (although not formally) a trustee for himself and his successors. The inheritance tax paid by the tenant for life can be recovered if the land is sold, but the right to do so must be registered as a Class C(ii) land charge if it is to be enforceable against the purchaser of the land.

This site contains general legal information but does not constitute professional legal advice for your particular situation. Persuing this glossary does not create an attorney-client or legal adviser relationship. If you have specific questions, please consult a qualified attorney licensed in your jurisdiction.

This glossary post was last updated: 29th March 2024.