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Land Law > 1 - The Nature of Land > Flashcards

1 - The Nature of Land Flashcards

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1
Q

What is the difference between real property and personal property?

A

English Law distinguishes the rules that apply to:
- Land (real property), and
- The rules that apply to every other type of property e.g., cars, books, televisions, copyrights, and shares (personal property).

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2
Q

What is modern land law?

A

Land law focuses on the rights over land, and the responsibilities and duties in land-related relationships, rather than the physical land itself.

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3
Q

Which statute is the foundation of modern land law?

A

Law and Property Act 1925 (LPA).

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4
Q

What does the Land Registration Act 2002 govern?

A

The LRA governs the system of land registration, a national record of land ownership in England and Wales.

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5
Q

Who manages the national record of land ownership?

A

HM Land Registry, a government department, manages the national record of land ownership.

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6
Q

In what context is the distinction between proprietary and personal rights important?

A
  • The remedy available to someone who is deprived of their right.
  • The enforceability of it against third parties. (The new owner of the land burdened by the right).
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7
Q

What is the difference between proprietary and personal rights?

A
  • Proprietary: Enforceable against 3rd parties and can be enforced by an action in rem (use/possession of the land can be recovered). The holder of the right does not have to settle for damages if deprived.
  • Personal: Can only be enforced by a personal action (in personam) against the person who granted the right for damages as remedy if right is breached. Only binds original parties to the right, there can be no recourse against a third party.

Whether a disputed right is capable of being recovered and enforced against a new owner of the burdened land will depend upon determining this point.

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8
Q

How do you tell whether a right exercised over land is proprietary?

A

The holder of a proprietary right in the land will have a right to occupy, use or restrict what can be done on the land in some way.

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9
Q

Which rights on the ‘fixed list’ have proprietary status?

A
  • The freehold estate
  • The leasehold estate
  • An easement
  • A mortgage
  • A restrictive covenant
  • An estate contract
  • A beneficial interest in a trust of land
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10
Q

How do you find out if a piece of land is subject to a proprietary right?

A

Proprietary rights in land must be made apparent by registration at the Land Registry if they are to bind a purchaser of subsequent rights in the same land.

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11
Q

How do you determine whether a right is proprietary or personal?

A

The nature, creation and protection of rights in land determine if they are proprietary or personal. Not all on the fixed list always have proprietary status.

Fixed list - Is it on the list of recognised proprietary rights in land?

Nature -Does it satisfy certain substantive (definitional) characteristics for the particular proprietary right?

Creation - Has it been created/acquired in accordance with the formalities required for the right (if any)? Compliance, or otherwise, with such formalities may ultimately determine whether the right is proprietary or not.

Protection - If a right is proprietary, you need to ask if it is enforceable against a third party (ie a new owner of the burdened land). Whether it will be enforceable often depends on whether the right has been registered.

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12
Q

What is an example of a personal right?

A

For example, a homeowner runs a guesthouse and grants guests a licence to stay, and enter into a contract with the guests.

If the owner stopped the guests from staying in the guesthouse, then the guest would only be able to seek damages for breach of contract and would not be able to recover the right to stay in the guesthouse or enforce the contract against a third party owner should the house be sold.

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13
Q

What is an estate?

A

A proprietary right of possession in land.

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14
Q

What is a freehold estate?

A

The highest possible estate in land, the fee simple absolute in possesstion - Freehold. (LPA 1925, s1(1)(a)).

Fee - Capable of being inherited.

Simple - It can be inherited by any heir, including distant relatives.

Absolute - The estate is not liable to end prematurely, not determinable or subject to a condition.

In Possession - The fee simple owner has a current right to use and enjoyment of the property. Physical possession not necessary, ie a landlord.

Lasts indefinitely.

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15
Q

What is a leasehold estate?

A

Where a freeholder owner grants a lesser estate, which is of a certain duration, the estate granted is a term of years absolute (LPA 1925, s1(1)(b) LPA) commonly known as the leasehold estate.

A piece of land may be subject to one or more leases.

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16
Q

What is a sub-lease?

A

The leaseholder (tenant) may grant a lease of a lesser duration out of their own leasehold, whilst still retaining the original lease, known as a sub-lease.

This process may continue with sub-leases being granted for shorter periods by the successive sub-lessees.

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17
Q

What are freehold and leasehold reversions?

A

Freehold reversion - The residue of the estate after the granting of a lease.

Leasehold reversion - If the grantor holds the leasehold estate, the residue is known as the leasehold reversion.

This means that when the lease ends the right to physical possession of the land automatically reverts to the landlord.

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18
Q

What are the hierarchy of rights in possession?

A

Freehold
Leasehold
Sub-lease

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19
Q

What is a commonhold estate?

A

Commonhold is a type of freehold introduced by the Commonhold and Leasehold Reform Act 2002.

Commonhold is an estate created out of a freehold registered estate. It is designed to meet the needs of owners of flats or apartments, or other properties where the owners are interdependent on each other, i.e., retirement homes.

There is no overall landlord. However, there is a freehold owner, that is a company called a commonhold association. The owner of each flat is a member of the association, who is responsible for maintining the communal areas of the building.

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20
Q

What are interests in land? / incumbrances

A

Proprietary rights of a more limited use.

An interest in land does not give a right to possess in the way an estate does, rather gives the interest holder the right to do something on the land, or restrict what can be done on the land.

Powerful right in the land, can be recovered (enforced in rem) and capable of enforcement against 3rd parties.

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21
Q

Which interests are legal in nature? (incl relevant legislation).

A

S1(2)(a)-(e)LPA 1925

  • Mortgages
  • Easements granted for a term equivalent to a freehold or leasehold estate (forever or a certain term).
  • Rights of entry.
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22
Q

Which interests are equitable in nature? (incl relevant legislation).

A

S1(3) LPA 1925

  • Freehold covenants.
  • Estate contracts.
  • Interests in a trust of land.
  • Easements granted for an uncertain term.

Recognised by courts as having proprietary status. Will only take effect in equity.

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23
Q

What is a mortgage? (incl legislation).

A

LPA 1925, s1(2)(c)

A bundle of rights granted over a property by the borrower to the lender as security in exchange for a loan of money. This includes the right to possess and sell the land in the event of default in the mortgage repayments.

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24
Q

What is an easement? (incl legislation).

A

LPA 1925, s1(2)(a)

An easement is a proprietary right to use land which belongs to somebody else.
It must be granted for a term equivalent to one of the legal estates (freehold, leasehold).

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25
Q

What is a right of entry? (incl legislation).

A

LPA 1925, s1(2)(e).

Known as a forfeiture clause.
A right for a landlord to re-enter leased premises and end the leasehold estate in the event of tenant default or some other specified event occuring, or
A rentcharge owner’s right to hold the land if money owed is not paid - uncommon.

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26
Q

What is a restrictive covenant? (incl legislation).

A

LPA 1925, s1(3)

Negative in nature - A promise made which prevents a land owner from doing something on their land. E.g., a promise to only use the land for residential purposes.

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27
Q

What is an estate contract?

A

A contractual right to a legal estate, whether freehold or leasehold, resulting in an equitable right arising.

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28
Q

What is an interest in a trust of land?

A

Where the trustee holds property for the benefit of the beneficiary resulting in a split of the legal and equitable title (ownership).

The trustee(s) hold the the legal title. The beneficiary(s) hold the equitable title.

Can be the same or different people.

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29
Q

How is an express trust created?

A
  • Self-declaration: The settlor (entity that establishes the trust) retains the legal title to their property but declares that they hold the property as trustee for the benefit of another person (the beneficiary).
  • Declaration plus transfer: The settlor declares a trust and transfers legal title to their property to the trustees who hold the property for the benefit of the beneficiaries.
30
Q

What is an implied trust?

A

A type of trust that can arise impliedly without any express declaration of trust by the legal owner. Resulting and constructive trusts.

31
Q

What is a resulting trust?

A

A person who is not the legal owner contributes directly to the purchase price of the property. The person acquires an interest proportionate to their contribution

32
Q

What is a constructive trust?

A

When a person, who is not the legal owner of the property, makes a contribution to the property other than a direct financial contribution at the time of the purchase.

Quantified by considering the parties’ conduct, the direct and non- direct financial contributions and any non- financial contributions.

33
Q

What are the remedies available for legal interests?

A

Damages, which the holder of the right would get automatically. No discretion to consider the merits of the case.

A number of equitable remedies available up-on satisfaction of usual equitable principles.

34
Q

What remedies are available for equitable interests?

A

Damages, or other equitable remedies, available entirely at the discretion of the court.

35
Q

How can a freehold estate be transferred?

A
  • Sale
  • Will
  • Gift
  • Operation of law (automatic transfer e.g., in bankruptcy)
36
Q

What are the formalities for sale of a freehold?

A

LPA 1925, s52:
- Exchange of contracts (voluntary, and not legally necessary to transfer the estate.)
- Completion of the deed (necessary).
- Rgistration (necessary).

37
Q

What is pre-exchange when selling a freehold?

A

The practical steps that the buyer’s and seller’s solicitors carry out before the contract is entered into. E.g., finding out about any proprietary rights which benefit or burden the land.

38
Q

What are the legislative requirements for the valid exchange of contracts?

A

LP(MP)A 1989, s2 requirements that must all be satisfied to have a valid land contract:

  1. The contract must be in writing.
    (There is no scope for an oral contract).
  2. It must contain all the expressly agreed terms.
    (Set out in the document or by reference to another document)
  3. It must be signed by both parties.
    (If the contracts are exchanged, in two documents provided they are identical - LP(MP)A 1989, s2(1)).
39
Q

What are the legislative requirements for completion of the deed?

A

Completion occurs by way of deed, a written legal document.

The requirements for a valid deed set out in LP(MP)A 1989, s1:

  • A deed must be clear on the face of the document that it is** intended to be a deed**.

(satisfied by labelling the document as a deed).

  • The deed must be validly executed.

(signed in the presence of a witness, who attests the signature - also signs the deed). (No legal requirement for buyer to sign but in practice both parties tend to).

  • The deed must be delivered.

(Acknowledgement that the person entering the deed intends to be formally bound, takes place by dating the document).

Generally called a TR1, which is a form prescribed by the land registry.

40
Q

What happens upon completion for unregistered land?

A

Known as a transfer. Legal title passes. Sale triggers a legal requirement to register the land for the first time at the Land Registry (LRA 2002, ss4 and 6).

41
Q

What happens upon registration for registered land?

A

Sale of registered land known as a conveyance.

You must ‘tell’ the Land Registry that the buyer is the new owner of the land by sending the completed deed.

Legal title will only transfer to the buyer once registration occurs (LRA 2002, s27(1)).

42
Q

What happens upon registration for registered land?

A

Legal title is transferred upon completion of the deed.

The new owner must register the land for the first time (first registration) within two months of completion, otherwise the legal title will revert back to the seller (LRA 2002, ss 4 and 6.)

43
Q

Can a land contract be varied?

A

McCausland v Duncan Lawrie Ltd [1997] 1 WLR 38

Whenever a material term in a land contract is varied that variation must also comply with LP(MP)A 1989 s.2. e.g., the completion date will be considered material.

44
Q

What is the proprietary effect of a land contract?

A

A contract to create or transfer a legal property will create a proprietary right in equity (equitable interest), called an estate contract.

Walsh v Lonsdale (1882) 21 Ch D 9 - Despite not executing a deed to create a legal lease, the court recognised an equitable lease because of the existence of the contract and the availability of the remedy of specific performance.

45
Q

When will courts recognise an equitable interest in the land? (land contracts)

A
  • There is a document that complies with LP(MP)A 1989, s2.
  • The remedy of specific performance is available.
46
Q

When is the remedy of specific performance available?

A

The claimant must have clean hands for the land contract to be recognised as an equitable interest in the land. The person seeking the remedy must not be in breach of the terms of the contract.

Coatsworth v Johnson [1886-90] All EER Rep 547.

47
Q

Which estate contracts create a contractual right to a legal estate?

A
  • Sale contract: Records the terms of the agreement, legally commits parties to the purchase/sale.
  • Agreement for lease/ Contract for lease: Landlord and tenant commit themselves to enter into the lease in the future.
  • Option Agreement: Gives another party a right, during the option period, to serve notice that they wish to buy the land. Buyer not obliged to exercise the option
  • Right of pre-emption: Gives another party a right of first refusal in the event that the land owner decides to sell their land. Land owner must offer sale to the right holder first.
48
Q

Is an estate contract binding on third parties?

A

To be binding on a purchaser, an estate contract must be protected.

A third party donee, who is gifted or inherits the land, will be bound by an estate contract.

49
Q

What are the remedies for breach of a land contract?

A
  • Damages: Available automatically. Measure of damages is the loss which the claimant suffered as a result of the breach.

Equitable remedies - Equitable principles apply. The court will have regard to the behaviour of the parties in determining whether to grant the remedy:
- Specific performance: Court order compelling the defaulting party to carry out positive contractual obligations. Not available automatically.
- Injunction: Prohibitory court order E.g., preventing the seller from selling the land to someone else. Not available automatically.

50
Q

How do you prove ownership of registered or unregistered land?

A
  • Registered: Registered at the Land Registry
  • Unregistered: The title information (ie who owns the property) is contained in various old deeds.
51
Q

What are the disadvantages of the unregistered land system?

A

Difficult to discover third-party rights.
No state guarantee of accuracy or compensation for error.
Examining old title deeds is difficult, slower, and may incur more expensive legal fees for the seller.
Difficult to know for certain the extent of the property.

52
Q

What legislation governs the present system of land registration?

A

Land Registration Act 2002.

Designed to simplify and cut down on the costs of conveyancing, while allowing for a complete record of all matters relating to a piece of land.

53
Q

What are the advantages of using a registered land system?

A

Each registered title has a title plan which evidences the full extent of the property.
Ownership is guaranteed by the State upon registration as title owner. If incorrect the innocent party can make a claim for compensation.
Reduces the risk of fraud.
Speeds up the conveyancing process - title deduced quickly etc.
The buyer knows what it is buying, and the holder of the interest knows that by recording it on the register it is enforceable against a new owner.

54
Q

What are the most common triggering events for land registration?

A

The most common ‘triggering events’ under LRA 2002 are:

  • Transfer of the freehold estate by sale, gift, or court order.
  • Grant of a lease for a term of more than seven years.
  • A first legal mortgage of the freehold or of a leasehold with more than seven years to run.

These apply to both unregistered land (triggering a first registration requirement, LRA 2002 s4) and registered land (triggering a requirement to update the register, LRA 2002 s27)

55
Q

What are the three principles of the system of registered land?

A
  1. The Mirror Principle
  2. The Curtain Principle
  3. The Insurance Principle
56
Q

What is the Mirror Principle?

A

That the LR should reflect all matters that the property has the benefit of and all the matters that the property is subject to. A comprehensive account of the ownership and rights that benefit and burden a piece of land.

57
Q

Why has The Mirror Principle never been realised?

A

Due to the existence of overriding interests. - An interest that does not appear on the LR but will still be binding on the owner of the legal estate and subsequent buyers.

58
Q

What is the Curtain Principle?

A

The LR records the ownership of the legal estate in the property, the legal title.

If the property is held on trust (beneficial or equitable ownership), this is kept off the title.

Simplifies conveyancing, making the process of investigating ownership of land simplier and quicker.

59
Q

What is the Insurance Principle?

A

The accuracy of the LR is guaranteed by the state.

If there is an error, it will be corrected and any loss will be compensated (state indemnity) - LRA 2002, sch 8, para 1.

60
Q

When a piece of land is registered for the first time, what details are included?

A
  • Unique title number.
  • The details of the landowner.
  • The rights that benefit/burden the land.
  • Title plan.
61
Q

What are the different classes of title given by the LR on first registration?

A
  • Absolute
    The best and most common form of ownership. The land is only bound by interests that are registered on the title or overriding interests.
  • Qualified
    If the title has some defect, which will then be specified on the LR. Rare to see.
  • Good Leasehold
    Where the LR is satisfied as to the title of the leaseholder only and not the freeholder.
  • Possessory
    May be given by the LR where the applicant is in possession of the property, or in receipt of rents and profits and there is no other class of title that can be given. Where theere are no title deeds to prove ownership, or the deeds have been destroyed.
    Usually given to those with a claim under ‘Adverse Possession’ or ‘Squatters Rights’.
62
Q

Are Possessory titles binding on third-parties?

A

Possessory title may mean that third party interests created before the date of first registration will bind the property even though these are not noted on the title.

63
Q

Which legislation requies you to keep the LR updated?

A

**LRA 2002, s 27 **provides a list of transactions involving already registered land which must be registered i.e. the Land Registry must be notified of the transaction so that the register can be updated accordingly.

Failure to register means the transaction is not legally recognised (LRA 2002, s 27(1).)

64
Q

What are the three registers on the LR?

A

Each registered title (Official Copy) is split into three registers:

The property (describes the land & any rights that benefit it),
Proprietorship (landowner details), and Charges register (burdens, e.g., interests in the land).

65
Q

What is the statutory definition of land?

A

LPA 1925, s205(1)(ix):

The surface, buildings, or parts of buildings on the land, other corporeal hereditaments (physical things attached to the land - fixtures), and other incorporeal hereditaments (proprietary rights with no physical substance eg an easement).

A buyer of the land gets everything that falls within the legal definition of land (LPA 1925, s62)

66
Q

What are an owners right to airspace?

A

Restricted to such height as is necessary for the ordinary use and enjoyment of the land and the structures upon it (lower airspace).

The law makes a distinction between the upper and lower airspace. E.g., flying an aircraft above a house is not trespass.

67
Q

What are an owners rights to the ground below land?

A

A conveyance of land ordinarily carries with it all that is beneath the surface.

Exceptions to this principle include:
- The minerals and any “treasures” under the land, e.g., gold and silver, belong to the Crown.
- Any coal under the land.
- No trespass below 300 metres e.g., deep-level drilling.

68
Q

What is the difference between a fixture and a chattel?

A

Fixture - Something that should remain upon sale as its part of the land.
Chattel - Something that the seller can take with it upon sale.

68
Q

What is the legal test for determining if an object is a fixture or a chattel?

A

**1. The degree of annexation test. **

Whether the object is fixed to the land or building. Even if it is fairly easy to remove, its character is prima facie that of a fixture.

If it rests on the land by its own weight, it is generally considered a chattel.

2. The purpose of annexation test.

Why the object is attached to the land/building.

If the attachment is temporary and is no more than is necessary for the item to be used or enjoyed, it will remain a chattel.

68
Q

What items are considered fixtures?

A
  • Kitchen units
  • Items installed by a builder
  • Bathroom fittings.
69
Q

What items are considered chattels?

A
  • Ornamental items.
  • Carpets and curtains.
  • Light fittings.
  • Kitchen appliances (washing machine) that can be removed without causing damage.
70
Q

How are fixtures transferred in practice?

A

Under LPA 1925, s 62, a conveyance of land (ie a transfer) automatically includes all fixtures in the property, unless the items are specifically excluded from the sale in the contract under the LPA 1925, s 62(4).

If the contract is silent and does not specifically exclude any items from the sale, the seller may not remove a fixture after they have contracted to sell the property to another.

To avoid a dispute about whether an item is a fixture or chattel, it is common practice for the buyer and seller to agree which items are to pass on the sale by completing a** Law Society Fixtures and contents form (Form TA10)** which forms part of the contract.

Land Law (8 decks)

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