Overview
Islamic finance arrangements can make ownership checks more complicated in party wall matters. A Land Registry search may show the finance provider as the registered owner, even though another person occupies the property and has the practical benefit of it.
That can create confusion when deciding who should serve or receive a party wall notice.
Why ownership matters under the Act
The Party Wall etc. Act 1996 uses a wider definition of "owner" than everyday language.
Section 20 includes, among others: - a person entitled to receive rents or profits from land; - a person in possession of land, other than as a mortgagee or short-term tenant.
This means the registered proprietor is not always the only relevant owner for party wall purposes.
How Islamic finance can affect the position
Some Islamic finance structures involve the finance provider holding the registered legal title, while the occupier has possession and economic benefit under the finance arrangement.
In that situation, the occupier may still fall within the Act's definition of owner, even if the Land Registry entry appears unhelpful.
Practical approach
Where Islamic finance is involved, the safest approach is usually to: - review the Land Registry title; - ask for written confirmation of the finance arrangement; - identify who is in possession; - identify who receives or is entitled to rents or profits; - consider serving notices on all relevant parties where there is uncertainty.
Over-serving is often safer than under-serving, provided the notices are accurate and properly addressed.
Building owners
If you are carrying out works and your property is held under an Islamic finance arrangement, make sure your surveyor understands the structure before notices are served.
Adjoining owners
If you receive a notice and ownership is unclear, ask for clarification quickly. Do not wait until the process has moved on.