What is meant by the term 'cloud on a title'?

The term 'cloud on a title' refers to a defect or uncertainty that affects property ownership. This can arise from various issues such as liens, claims, or other legal encumbrances that may challenge or limit the owner's title rights. A cloud on the title indicates that there are unresolved legal questions regarding who has the rightful ownership of the property, which can complicate transactions or cause disputes.

Understanding this concept is crucial in land surveying and real estate transactions because it highlights the need for thorough title examination and resolution of any outstanding issues before transferring ownership or encumbering the property. Addressing a cloud on the title is often an essential step in ensuring that the title is marketable and free from disputes, which provides security to both buyers and lenders involved in property transactions.