Defective Title

Business, Legal & Accounting Glossary

Definition: Defective Title

What is the dictionary definition of Defective Title?

Dictionary Definition

n. an apparent title to real property which fails because a claimed prior holder of the title did not have title, or there is a faulty description of the property or some other “cloud” over it, which may or may not be apparent from reading the deed.

Full Definition of Defective Title

An owner’s Title to land or goods can be ‘defective’ (that is, less than perfect) in at least four ways.

  1. He may not be the owner at all. Of course, the reason why a person seeks to sell something he does not own might be because he is a villain. However, a person may be dispossessed of his title by the action of law, and then find that he cannot pass title in a sale. For example, the owner of unregistered land may be dispossessed by a squatter if he loses his right to remove the squatter after 12 years (see adverse possession). Although the dispossessed owner holds the title deeds, if the squatter has subsequently been registered as the proprietor, the former owner no title to pass.
  2. The owner may have limited powers of disposition. This situation often arises where the owner is a company; its powers to buy and sell property may be limited by statute or by its own articles. As far as land is concerned, the LRA (2002) now makes it clear that a person (legal or natural) who sells property outside its powers is not prevented from giving good title simply by the fact that the sale was ultra vires; however, both the seller and the buyer may still be acting unlawfully.
  3. The property is subject to Incumbrances (that is, third-party rights are against it).
  4. The title may have become determinable. That is, someone else may have the power to bring the title to an end. This situation usually occurs in the context of Leasehold land, where the tenant has done something that gives the landlord aright to reenter, but that right has not yet been exercised.

Cite Term

To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.

Page URL
Modern Language Association (MLA):
Defective Title. Payroll & Accounting Heaven Ltd. September 23, 2021
Chicago Manual of Style (CMS):
Defective Title. Payroll & Accounting Heaven Ltd. (accessed: September 23, 2021).
American Psychological Association (APA):
Defective Title. Retrieved September 23, 2021, from website:

Definition Sources

Definitions for Defective Title are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 27th April, 2020 | 0 Views.