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Allodial Title
is a concept in some systems of property law. It describes a situation where real property (land, buildings and fixtures) is owned free and clear of any encumbrances, including liens, mortgages and tax obligations. Allodial title is inalienable, in that it cannot be taken by any operation of law for any reason whatsoever.
Legal concept
Allodial lands are the absolute property of their owner and not subject to any service or acknowledgment to a superior. An allodial title is the opposite of a feudal tenure such as fee simple. The derivation of the word is still doubtful, though it is probably compounded of the Germanic all, whole or entire, and odh, property. Allodial tenure seems to have been common throughout northern Europe, but is now unknown in common law jurisidictions apart from the United States. Allodial titles are known as udal tenure in Orkney and Shetland, the only parts of the United Kingdom of Great Britain and Northern Ireland where they exist.
As late as the Tudor period, in order to avoid estate taxes, a legal loophole was exploited where land was willed to a trustee for the use of the beneficiary. However, trustees often abused this privilege, and heirs found that the courts of common law would refuse to recognize the "use" clause, and would instead grant title in law to the trustee. However, the courts of equity, which were developed by the sovereign to deal with obvious injustices in the common law courts, ruled that the heirs were entitled to the use of the property, and gave them title in equity. As rulings of equity courts ranked above those of common law courts, this gave heirs the use of the land, but not title to it in the common law.
However, this distinction between common law and equity title helped develop forms of security based on the distinction, now known as the mortgage. Enjoyment of the property during the period where the mortgage was in good standing could be assured through the equity courts, while the right to foreclose on the property to merge the common law and equity title were guaranteed in the common law courts.