What is a Chain of Title?

A chain of title is legally defined as the official record of ownership of a property. For the most part, the term is used to refer to real estate documentation in which the “chain” is established in reverse order beginning with the current owner and ending with the original owner. A chain of title may also represent a history of the transfer of ownership to intellectual property in order to demonstrate proprietary rights to a film, piece of music, or other materials protected by copyright.

In terms of real estate, a title company constructs the title report by researching the archives of the county clerk or registrar of deeds. This document is necessary to prove that the current owner has the exclusive right to sell the property to another party and is revised each time ownership of the property is transferred or amended. Also known as an abstract of title, this record is also required to obtain title insurance to protect against financial loss or liability due to errors in the title report, or in the event the property is not eligible for transfer due to a lien. The language used in title reports to describe these events typically includes the phrases “conveyances” and “encumbrances.”

A chain of title may also be used to show existing or equitable non-possession interests in specific rights to a property, such as hunting, farming, or timber rights. Other rights outside of possession or ownership include easements, which grant another party the legal use of the property for a specific purpose. Examples of common easements described in title reports include access and development rights to a utility company for the purpose of maintaining utility lines and making related structural improvements. In other cases, a neighboring property may be granted an easement in a title due to both properties sharing a common entrance or exit route, like a driveway.

Establishing a chain of title in intellectual property usually involves several more components to clearly show and validate present ownership. For instance, claiming ownership to a literary work or musical composition typically requires copyright verification. In the case of films and movies, participating actors are asked to sign a release to allow the commercial distribution of their likeness. Similarly, other contributors, such as choreographers and animation artists, release the right of publicity to their works. In contrast to a real property title report being covered by title insurance, however, an intellectual property chain of title is guaranteed by proof of errors and omission insurance.