Difference between possession, ownership, and registered title

Introduction

In the field of Civil and Registry Law, the terms possession, ownership, and registered title are often used interchangeably in everyday language, even though each represents a distinct legal situation with significant implications. Understanding their differences is essential to determine who actually exercises rights over a property, who may dispose of it, and who merely occupies it in fact.

I. Possession

Possession is a factual situation recognized and protected by the legal system. According to Article 896 of the Peruvian Civil Code, it is defined as “the factual exercise of one or more powers inherent to ownership.” In simple terms, a possessor is a person who physically holds a property and acts as its owner, even if they are not necessarily the legal owner.

There are several types of possession:

• Lawful possession: when it derives from a valid title (for example, a sale contract or lease agreement).

• Unlawful possession: when it is exercised without title or in disregard of another person’s right.

• Good-faith possession: when the possessor believes, due to an error, that they are the legitimate holder.

• Bad-faith possession: when the possessor knows that the property belongs to another and nevertheless occupies it.

Over time, possession may produce legal effects such as acquisitive prescription, through which the possessor may become the owner if the legal requirements and statutory time periods are met.

II. Ownership

Ownership is a real right that grants its holder the legal power to use, enjoy, dispose of, and reclaim a property, in accordance with Article 923 of the Civil Code. It constitutes full ownership and is protected by Article 70 of the Political Constitution of Peru, which guarantees its inviolability and establishes that it may only be limited for reasons of public necessity or national security.

The owner may or may not be in possession of the property. In other words, a person may hold ownership rights while having transferred possession to a tenant, borrower, or other occupant.

III. Registered Title

Registered title is the legal presumption of ownership derived from registration in the Public Registries. According to Article 2012 of the Civil Code, “the content of a registry entry is presumed to be true and produces all its legal effects as long as it is not rectified or judicially declared invalid.”

Registration in the Property Registry aims to publicize ownership rights and provide legal certainty vis-à-vis third parties. However, registered title does not always coincide with actual ownership or possession of the property. For example, a person may appear as the registered owner, while another maintains continuous and peaceful possession of the property without being recorded in the registry.

IV. Relationship and Essential Differences

Concept	Nature	Source	Main Effect
Possession	Factual situation	Physical occupation or control	May lead to acquisitive prescription
Ownership	Full real right	Valid title (contract, adjudication, etc.)	Grants dominion and power of disposal
Registered title	Legal presumption	Registry inscription	Publicity and enforceability against third parties

In summary:

• One may possess a property without being its owner.

• One may be an owner without being registered.

• One may be the registered titleholder without possessing the property.

V. Conclusion

Distinguishing between possession, ownership, and registered title allows for a precise delimitation of the rights and obligations of each individual with respect to a property. In legal and registry practice, correctly identifying each situation helps prevent ownership disputes, actions for recovery of possession, or acquisitive prescription proceedings. Understanding these differences is essential for any real estate transaction, ensuring that the title held is not merely registered, but also legally and factually sound.