2a. Property - Land

Question 1

Nature of land

To what extent does a landowner have a right to the air above?

Answer 1

To the extent necessary for the ordinary use and enjoyment of the land

Question 2

Nature of land

Is a freehold landowner entitled to all minerals under his land?

Answer 2

Except coal, oil, natural gas, gold, silver, and treasure, to which the Crown is entitled

Question 3

Nature of land

What does a landowner need to draw water from a source running through their land?

Answer 3

A licence

Question 4

Nature of land

What does the degree of annexation test provide?

Answer 4

The greater something is attached to the land, the more likely it is to be a fixture

Question 5

Nature of land

What does the purpose of annexation test look at?

Answer 5

Whether something was brought onto the land with an intent to make a permanent improvement or only a temporary one

If the purpose of annexation test is met, the degree of annexation becomes irrelevant

Question 6

Estates and interests in land

What are the two estates under the Law of Property Act 1925?

Answer 6

1. Freehold estate (uncertain duration)
2. Leasehold estate (fixed duration)

Question 7

Estates and interests in land

What are the five types of legal interest, and how must they be created?

Answer 7

1. Legal mortgage
2. Legal easement
3. Rentcharge
4. Right of entry
5. Profits a prendre

Must be created by deed.

Question 8

Estates and interests in land

What three things are required for a deed to be valid?

Answer 8

1. In writing
2. Clearly intended to be a deed
3. Duly executed as a deed

Duly executed means signed in the presence of an attesting witness and delivered (delivered means expressing an intention to be bound)

Question 9

Estates and interests in land

What is a rentcharge?

What does the the rentcharge owner’s right of entry allow him to do?

Answer 9

An interest in land requiring the landowner to make a periodic payment in respect of land to the rentcharge owner, but is different to and cannot arise under a lease or tenancy

Enter and take possession of the premises in the event of a default

Question 10

Estates and interests in land

What is a profit a prendre, what are the two types, and what is the difference between the two?

Answer 10

An interest in land enabling someone to take something from the land of another

1. Profit a prendre in gross
   - Exists independently of the land
   - Can be exercised for personal benefit of the profit owner
   - Can be bought and sold separately from the land
   - Not attached to any piece of land
2. Profit a prendre appurtenant
   - Attached to a particular piece of land
   - Is bought and sold with the land

Question 11

Estates and interests in land

What does the term concurrent interests describe?

Answer 11

The fact that a number of legal and equitable interests can exist in property at the same time

Question 12

Estates and interests in land

What is a common situation in which an equitable interest may arise by accident?

Answer 12

When parties attempt to create a legal interest by deed, but the formalities for a deed are not met

Question 13

Estates and interests in land

What are the some types of equitable interest?

Answer 13

1. Equitable mortgage
2. Equitable covenant (restrictive or positive)
3. Equitable easement
4. Estate contract

Question 14

Estates and interests in land

For what two reasons is the deposit of title deeds as security for a loan not enough to create an equitable mortgage?

Answer 14

1. Equity requires sufficient evidence in writing before an equitable mortgage can be created
2. A contract for property must be in writing, and in this situation there is no written agreement capable of enforcement

Question 15

Estates and interests in land

For equitable interests created after 1925 and equitable interests which are not a beneficial interest under a trust, what is required for an equitable interest to be binding?

Answer 15

Notice

A BFP for V without N will not be bound

Other than the two examples, this requires the interest to be registered, otherwise there is no notice.

Question 16

Estates and interests in land

In what four situations is a deed not needed to transfer property?

Answer 16

1. Assents by personal representatives
2. Disclaimers under the Insolvency Act 1986
3. Surrenders by operation of law
4. Leases, tenancies or other assurances not required by law to be in writing

Question 17

Principles of unregistered title

What two interests will a buyer of an unregistered legal estate purchase it subject to?

Answer 17

1. Any legal interest over the estate, whether or not they were aware, and
2. Any equitable interest of which they have notice

Question 18

Principles of unregistered title

How are legal interests generally discovered?

Answer 18

Checking the deeds, or inspecting the property

Question 19

Principles of unregistered title

What does it mean when a seller deduces title to the buyer, and what is the traditional way of doing so ?

Answer 19

Seller proves that they own the land they are contracting to sell, by producing documents commencing with a good root of title demonstrating an unbroken chain of ownership for a minimum of 15 years

Question 20

Principles of unregistered title

What are the four requirements of a good root of title?

Answer 20

1. At least 15 years old
2. Deal with the whole legal and equitable interest in the property
3. Contain adequate description of the property
4. Do nothing to cast doubt on title

Question 21

Principles of unregistered title

What is the epitome of title?

When does the seller send this?

Answer 21

A chronological list of all the documents, together with a copy of each

In the contract package

Question 22

Principles of unregistered title

What is required for most equitable rights and interests to be enforceable against subsequent buyers?

Answer 22

Registration with Land Charges Department of HM Land Registry

Question 23

Principles of unregistered title

What is an equitable interest land charge registered against, and who makes the application for it?

Answer 23

It is against the name of the estate owner at the time the land charge was created, not the address of the property

Applied for by the person who claims the right

Question 24

Principles of unregistered title

What are the two Class C equitable interest land charges relevant to the SQE?

Answer 24

1. C(i): Puisne mortgage, i.e. a legal mortgage not protected by deposit of title deeds, e.g. a second legal charge
2. C(iv): Estate contract, e.g. protects the interest of someone who has an option to purchase or has executed a contract to purchase but before completion

Second mortgage can’t be protected by title deeds as first lender has them

Question 25

# Principles of unregistered title What are the two **Class D** equitable interest land charges relevant to the SQE?

Answer 25

1. **D(ii)**: Restrictive covenant 2. **D(iii)**: Equitable easement

Question 26

# Principles of unregistered title What does a **Class F** equitable interest land charge protect?

Answer 26

A non-owning spouse's statutory right of occupation in the matrimonial home

Question 27

# Principles of unregistered title What is the relevance of registration of these land charges? ## Footnote Does registration bind subsequent owners?

Answer 27

They constitute **actual notice** of the interest ## Footnote Yes, because registration is **actual notice** of the interest to **all persons**

Question 28

# Principles of unregistered title What is the consequence of an equitable land charge not being registered?

Answer 28

It is **void** against a purchaser for **value** ## Footnote Unless the doctrine of notice applies and they have other **actual**, **constructive**, or **imputed** notice

Question 29

# Principles of unregistered title To what two things does the **doctrine of notice** apply, and under it, what four things must a buyer show to take free of any *equitable* interest?

Answer 29

Only applies to **equitable interests pre-dating 1925** and **beneficial interests under a trust**. To take free, the buyer must show they: 1. Were a BFP for V without N 2. Acquired a **legal** estate/interest, *not just an equitable interest*

Question 30

# Principles of unregistered title When will a person be deemed to have constructive notice?

Answer 30

When they would have discovered something with reasonable enquiry

Question 31

# Principles of unregistered title What is imputed notice?

Answer 31

Notice given to an agent of a buyer is deemed to be given to the buyer Things an agent *should have known* can also be imputed to a principle, i.e. things the agent should have constructive notice of can be imputed to the principle.

Question 32

# Principles of unregistered title Why is notice irrelevant in the registered system?

Answer 32

Because interests are either: 1. Registered (and therefore binding on the buyer) or 2. Protected as **overriding interests** (which automatically bind the transferee irrespective of registration or notice) ## Footnote Failing that neither legal nor equitable interests are binding and any other notice cannot save them

Question 33

# Principles of unregistered title What does someone receiving unregistered property as a gift take the property subject to?

Answer 33

Any equitable interest, even if without notice | **Paying value** is the key defence mechanism in this situation

Question 34

# Principles of unregistered title What does it mean for an interest in unregistered land to **override first registration**, and what are four examples of interests which do this?

Answer 34

It means that it is sheltered from and superior to the first registration of the land 1. Lease for **seven years or less** 2. **Legal** easement 3. Local land charge 4. Interest of a person in **full occupation**

Question 35

# Principles of unregistered title How does an interest which overrides cease to be overriding?

Answer 35

If the **buyer is aware of it**, they must disclose it to HMLR, after which it is protected by an entry on the register

Question 36

# Principles of unregistered title Under the Limitation Act 1980, how long must the owner of an estate in **unregistered** land allow someone else to occupy it before the lose the right to recover the land?

Answer 36

**12** years | **10** years in the registered system

Question 37

# Principles of unregistered title In relation to unregistered land, what three things must an applicant for adverse possession show with regard to ***possession***?

Answer 37

1. Actual 2. Exclusive 3. Without permission of the landowner ## Footnote The point of adverse possession is that the applicant treat the land as theirs **as of right**, hence why the law should transfer it to them

Question 38

# Principles of unregistered title Where this 12 year period is met, does the legal owner **lose the legal title**?

Answer 38

No, but they hold the legal estate on trust for the squatter who can apply for registration ## Footnote In the registered system, the squattor only has the opportunity to apply for registration, which if objected to, will usually cause the application to be rejected

Question 39

# Registration of title What are the four main triggering events?

Answer 39

1. Grant of first **legal mortgage** 2. **Transfer**, e.g. conveyance on sale, assent, deed of gift 3. Grant of **lease exceeding seven years** 4. Assignment of lease with more than seven years remaining ## Footnote Requires registration within **two months** if occurring after **1 December 1990**

Question 40

# Registration of title What two things happen if registration is not applied for within the two month window in the case of (1) a conveyance and (2) a lease or mortgage?

Answer 40

1. Transfer of legal estate is void, and legal estate reverts to the transferor 2. Lessor/mortgagor retains full legal title but holds as trustee of the lessee/mortgagee | Cost of remedying failure to register falls on the party in default ## Footnote Two month window may be extended if good reason is provided to the Registrar

Question 41

# Registration of title What is the impact of a failed legal registration becoming an equitable estate?

Answer 41

It will lose priority to other transactions which create interests in the estate before defect is cured

Question 42

# Registration of title What are the five classes of title?

Answer 42

1. Absolute freehold *(legal estate plus all benefitting interests)* 2. Qualified *(specified interest is excepted from registration)* 3. Possessory *(based on factual possession; does not affect rights which pre-dated registration)* 4. Good leasehold 5. Absolute leasehold *(best as HMLR has inspected freehold and checked for superior leases)*

Question 43

# Registration of title Absolute freehold title is the best kind of title. What are the only two interests absolute freehold title is subject to?

Answer 43

1. Interests on the register after registration, e.g. charges, notices, restrictions 2. *Overriding* interests at registration

Question 44

# Registration of title How can *good leasehold* and *possessory* title be upgraded, and what are they upgraded to?

Answer 44

**Good leasehold** becomes absolute leasehold if landlord’s freehold title is produced. **Possessory** becomes absolute freehold if possessory title is not challenged for 12 years since it was granted.

Question 45

# Registration of title Other than freehold and leasehold estates in land, what three interests can be registered, and get their own title number and register?

Answer 45

1. Rentcharges 2. Franchises 3. Profits a prendre in gross

Question 46

# Registration of title How can a party with an interest in unregistered land ensure that they are notified if an application for registration is made regarding their land?

Answer 46

Register a caution against first registration, and the caution gets its own title number and register ## Footnote Owner of estate can apply to HMLR for caution to be cancelled on grounds that cautioner lacks the interest they claim

Question 47

# Registration of title What are four types of disposition which **do not operate until registered**? | Three are triggering events

Answer 47

1. Transfer of freehold estate *(for value, by court order, by gift, or by PRs)* 2. Grant of legal lease with more than seven years 3. Express grant or reservation of legal easement, legal profit, or legal rentcharge 4. First legal mortgage

Question 48

# Registration of title In the registered system, when does title pass?

Answer 48

When the disposition is registered at HMLR | Completion of the contract in unregistered system

Question 49

# Registration of title What are the three *registers* on the register of title, and what appears on each?

Answer 49

1. Property register *(basic details; rights benefitting the land)* 2. Proprietorship register *(class of title; name of estate holder; restrictions on the land)* 3. Charges register *(rights of others burdening the land, e.g. mortgage or easement)*

Question 50

# Registration of title What is a notice?

Answer 50

* Entry on the **charges register of burdened land** in respect of an interest affecting the registered estate, or * Entry on the **property register of benefitting land** in respect of an interest benefitting the estate.

Question 51

# Registration of title What is a restriction?

Answer 51

An entry on the **proprietorship register** used to prevent any dealing with the land otherwise than in accordance with the terms of the restriction ## Footnote E.g. in a tenancy in common: "No disposition by a sole proprietor..."

Question 52

# Registration of title What is an **overriding interest** in the registered system?

Answer 52

Interest which is binding on both the proprietor and a person who acquires an interest **despite the fact that the interest does not appear on the affected register of title**

Question 53

# Registration of title What are the three **overriding interests** in the registered system?

Answer 53

1. Legal leases for seven years or less 2. Legal easement or profit*, not expressly created by deed* 3. Interest of person in actual occupation*, except spouse who must use an F land charge*

Question 54

# Registration of title What is the main difference between interests which override in the unregistered system and overriding interests in the registered system?

Answer 54

**Local land charge** is an interest which overrides in the unregistered system but not an overriding interest in the registered system

Question 55

# Registration of title What is the requirement for the type of easement that can be overriding in the registered system, and what type of easement cannot be, and why?

Answer 55

It must be a legal easement and must **not** be an **express** easement, i.e. it must arise from implied grant/reservation or prescription. An expressly created easement (i.e. created by deed) cannot be overriding. ## Footnote *Because an express easement must be registered in its own right to be effective, and when it is placed on the charges register of the burdened land, it becomes binding anyway.*

Question 56

# Registration of title Other than not being an express easement, one of what two options must be satisfied for a legal easement to be overriding in the registered system?

Answer 56

1. Known to the buyer or obvious on reasonable inspection, or 2. Exercised within **one year** of the date of the disposition

Question 57

# Registration of title What must a person claiming the overriding interest have in addition to **mere occupation**?

Answer 57

A **property right** in the land, e.g. tenancy or right to remain

Question 58

# Registration of title What will make an interest cease to be overriding?

Answer 58

If upon disclosure to HMLR during applying for registration or a registrable disposition, the **interest is capable of registration**, it will cease to be overriding and will be protected by an entry on the register of title

Question 59

# Registration of title In the registered system, how is the process of adverse possession different?

Answer 59

1. Period is 10 years instead of 12 2. Squatter does not acquire any rights automatically 3. They merely receive a right to apply for registration of title at the end of the period 4. Landowner given opportunity to object, and if they do the application will usually fail 4. Other elements are the same: actual, exclusive possession, without landowner permission

Question 60

# Registration of title In what three situations may an application for adverse possession still be granted even though the landowner objects?

Answer 60

1. Unconscionable for the proprietor/landowner to seek to displace the applicant (i.e. on the facts, applicant should be regarded as the proprietor) 2. Applicant is for some other reason entitled to be proprietor 3. Reasonable mistake as to boundaries

Question 61

# Co-ownership What will the court do where, e.g. two parties buy a property, each contributing to the purchase price, but legal estate is conveyed to only one?

Answer 61

Infer a **resulting trust**, with the legal owner holding the estate on trust for both

Question 62

# Co-ownership What are the options where contributions are (1) equal and (2) unequal? ## Footnote What way *must* the **legal** estate be held, and why?

Answer 62

1. Equal: **Joint tenancy** 2. Unequal: **Tenancy in common** ## Footnote As **joint tenants**, because tenancy in common cannot exist at law

Question 63

# Co-ownership What is the impact of the doctrine of survivorship? ## Footnote Does the doctrine apply in law ***and*** equity?

Answer 63

Any attempt to gift or leave a joint tenancy upon death will fail, and it will vest automatically in the surviving joint tenants ## Footnote Yes

Question 64

# Co-ownership What is the maximum number of trustees that can hold the **legal estate** in land? ## Footnote What about the behind-the-scenes equitable interest?

Answer 64

Four ## Footnote No limit

Question 65

# Co-ownership What is a declaration of trust?

Answer 65

A **conclusive** agreement between co-owners as to how their beneficial interest is to be held

Question 66

# Co-ownership What is **severance** in the context of a *equitable beneficial interest*, and what are the seven ways it can be achieved?

Answer 66

Bringing the ***equitable* joint tenancy** to an end and converting it to a tenancy in common 1. Written notice 2. Treating a share as separate *(e.g. trying to sell/gift in spite of doctrine of survivorship)* 3. Disposal of equitable interest 4. Mutual agreement 5. Course of dealings 6. Forfeiture *(one tenant kills another)* 7. Bankruptcy

Question 67

# Co-ownership After a party disposes of or treats their share as separate, are they completely out of the picture?

Answer 67

No, they still hold the legal estate on trust for the purchaser of their share*, because severance only concerns the **equitable interest***

Question 68

# Co-ownership Why does the bankruptcy of one joint tenant sever an equitable joint tenancy?

Answer 68

Because the bankrupt's equitable share is transferred to the trustee

Question 69

# Co-ownership Although the intention of the parties will control, if it cannot be determined, what will the court assume?

Answer 69

That **equity follows the law**, and the beneficial interests reflect the legal interests, i.e. joint tenancy, because tenancies in common cannot exist at law

Question 70

# Co-ownership What should a solicitor acting for a buyer always be aware of when the legal estate is held by only one party?

Answer 70

There could be behind the scenes co-owners who may have a claim on the property

Question 71

# Co-ownership What is **overreaching**, and how does it occur? ## Footnote Why does this allow overreaching?

Answer 71

A process under which a buyer may take property free of a beneficiary's interest under a trust, when purchase money is paid to **all trustees** *(minimum of **two** or one if a trust corporation)* ## Footnote The payment transfers the equitable interest of the beneficiary **from the land** and attaches it **to the purchase money**.

Question 72

# Co-ownership What should a buyer do if there is only one trustee, to ensure they can overreach and take property free of the interest?

Answer 72

Ensure that a **second trustee** is appointed to receive the money, or obtain a written release from the beneficiary regarding this requirement

Question 73

# Co-ownership In the **registered** system, how will behind the scenes beneficial interest *typically* be evidenced?

Answer 73

By a **Form A restriction** on the **proprietorship** register

Question 74

# Co-ownership When will sections 14 and 15 of the Trusts of Law & Appointment of Trustees Act 1996 help co-owners?

Answer 74

If they cannot decide how or when to dispose of property

Question 75

# Co-ownership What does section 14 allow? ## Footnote What does it not allow?

Answer 75

It allows a trustee or any other person with an interest in property subject to a trust to apply to the courts for an order relating to the trustee's duties to sell, obtain consent, or declare the nature of a party's interest ## Footnote It does not allow the court the appoint or remove a trustee

Question 76

# Co-ownership What are the four factors under section 15 for the court to consider in determining an application under section 14?

Answer 76

1. Intentions of the trustees 2. Purpose for which the property subject to the trust is held 3. Welfare of any minor who occupies or might reasonably be expected to occupy 4. Interests of any secured creditor or beneficiary

Question 77

# Co-ownership If the court does have to make a split upon the breakdown of a relationship, what proportion will each receive and what will the court consider?

Answer 77

Each party will receive the proportion the court considers **fair considering all the circumstances** and not just those surrounding the purchase

Question 78

# Leases An **oral** tenancy is valid if for less than how long?

Answer 78

Three years

Question 79

# Leases Although a lease must generally be created by deed, what two things are required to create a legal short lease of **three years** or less in writing or orally **without a deed**?

Answer 79

Tenant: 1. Takes **possession** of leased premises 2. **Pays at least market rate rent** and are not required to pay any **upfront sum or premium**

Question 80

# Leases In a long term lease, what is required for the rent to be adjusted?

Answer 80

The lease must provide for it

Question 81

# Leases What is a reversionary lease, and what is the maximum period between the lease being entered into and the tenant taking possession for it to be valid?

Answer 81

A lease under which the tenant does not take possession until some time in the future | 21 years

Question 82

# Leases If there is no notice provision in a periodic tenancy, how much notice must be given to terminate it?

Answer 82

An amount of time equivalent to one *period* in the tenancy

Question 83

# Leases In an implied periodic tenancy, how is the *period* determined?

Answer 83

Based on the intervals between the payment of rent

Question 84

# Leases What arises and what does not arise if an owner of land allows a buyer to take possession of land before a written agreement is entered into? ## Footnote What is the effect of the prospective buyer in possession attempting to assign?

Answer 84

A tenancy at will *(not a legal interest)* may arise, but no estate in land is created ## Footnote It operates as notice to terminate the tenancy, as soon as the tenant notifies the landlord of such

Question 85

# Leases In the case where such a tenancy at will arises, what is the effect of the prospective buyer in possession (1) attempting to assign and (2) beginning to pay rent?

Answer 85

1. It operates as **notice to terminate** the tenancy, as soon as the tenant notifies the landlord of such 2. Court will treat it as a **periodic tenancy unless there is very clear evidence** that the parties intend the tenancy at will to continue

Question 86

# Leases In what two situations is a lease void for uncertainty?

Answer 86

1. A term is uncertain 2. Starting/ending date (if fixed) is uncertain/not knowable

Question 87

# Leases Even if a lease is not created by deed and is not an eligible short lease, **equity will recognise such as a contract** for the disposition of land if what two conditions are met? ## Footnote What does this not apply to and what will it not protect against?

Answer 87

1. Lease in writing incorporating all terms expressly agreed 2. Signed by all parties ## Footnote *This exception does not apply to oral leases and will not protect against a buyer of the landlord's reversion unless the lease is registered*

Question 88

# Leases How is an equitable lease which was recognised due to the failed creation of a legal lease appropriately registered in (1) the unregistered system and (2) the registered system?

Answer 88

**Unregistered**: Class C(iv) **estate contract** land charge **Registered**: Notice on the **charges** register ## Footnote Otherwise not binding on a BFP for V without N, unless rent is paid in which case it converts to a legal interest which *binds a purchaser of unregistered land* and will be an *interest that overrides first registration or a registrable disposition*

Question 89

# Leases What are the three characteristics of a lease? ## Footnote What is likely created if any is missing

Answer 89

1. Exclusive possession 2. Fixed or periodic time *certain* 3. In consideration of a premium *(lump sum or periodic payments)* ## Footnote Licence: a right to use land in some way, creating neither an estate nor an interest in land

Question 90

# Leases What covenants will a lease generally contain?

Answer 90

* To pay rent * Quiet enjoyment * Repair *(landlord and tenant's duties)* * Uses to which the premises can be put * Alterations *(either qualified or absolute bar)* * Assignment *(either qualified or absolute bar)*

Question 91

# Leases What is the covenant of quiet enjoyment?

Answer 91

An obligation imposed on the landlord to not interfere in any way with the tenant's enjoyment of the property **nor allow the lawful activities of other tenants to do so**

Question 92

# Leases Where an absolute bar is in place to make alterations or assign, can the tenant still ask for the landlord's specific consent? ## Footnote Where the bar is qualified, how forthcoming must consent be?

Answer 92

Yes ## Footnote It must not be unreasonably withheld

Question 93

# Leases What is Commercial Rent Arrears Recovery? ## Footnote Is is automatically available?

Answer 93

Statutory procedure allowing landlords of **commercial** premises to recover rent arrears by taking control of tenant's goods and selling them ## Footnote Available even if not expressly provided for in the lease

Question 94

# Leases What is forfeiture with regard to a lease, residential or commercial? ## Footnote Is it automatically available?

Answer 94

The right of the landlord to **re-enter the premises** and **bring the lease to an end** due to default by the tenant*, usually rent not paid* ## Footnote Must be expressly provided for in the lease

Question 95

# Leases What is the tenant's right in a forfeiture situation?

Answer 95

Settle the arrears instead of losing premises

Question 96

# Leases How might a landlord **waive** his right to forfeit?

Answer 96

By being **aware of the default** and then: 1. Accepting or demanding payment 2. Serving notice on tenant of repairs to be done 3. Carrying out distress for rent (re-entering and seizing tenant's goods in lieu of rent) ## Footnote Any act suggesting landlord has looked beyond forfeiture and wants to solve the issue another way

Question 97

# Leases What is a *Jervis v Harris* clause? ## Footnote What is the significance of the costs being recoverable as a debt?

Answer 97

**Self-help clause**, enabling **landlord to re-enter to make repairs and recoup costs as a *debt*** if tenant breached covenant to maintain *after serving notice on tenant to carry out repairs* ## Footnote Costs are recovered in a more straightforward debt action, rather than a damages action

Question 98

# Leases What are the remedies for breach of the covenant to pay rent?

Answer 98

1. Commercial Rent Arrears Recovery 2. Forfeiture

Question 99

# Leases What are the remedies for breach of the covenant to repair/maintain?

Answer 99

1. Damages 2. Specific performance 3. Self-help 4. Forfeiture *again* 5. Debt action

Question 100

# Leases What is a section 146 notice, and what are the three requirements for one?

Answer 100

The notice served on a tenant by a landlord for breach of repairing obligations when landlord wishes to forfeit the lease 1. Specify the breach 2. Require the breach to be remedied within a reasonable time 3. Require tenant to pay compensation *in any event*

Question 101

# Leases What is the first determining factor in whether covenants of a lease bind the original parties after assignment?

Answer 101

Whether the lease is granted before 1 January 1996

Question 102

# Leases What is the position under a lease made (1) before 1996 and (2) from 1 January 1996? ## Footnote In an on or post 1 January 1996 situation, what is the assignor still liable for?

Answer 102

* **Before 1996**: The original landlord and original tenant remain liable to one another, even after assignment, unless expressly released * **From 1 January 1996**: Tenants are automatically released from their covenants upon assignment ## Footnote Breaches of covenant which occurred **before assignment**

Question 103

# Leases What is an authorised guarantee agreement? ## Footnote Allowed in a residential lease?

Answer 103

An agreement*, usually required by a landlord as a condition of assignment,* whereby the original tenant will act as guarantor for his **immediate successor** in title, meaning only the last party to give an AGA is liable ## Footnote Not allowed **in the lease** and if the landlord tries to impose such in an assignment situation, it must be **imposed lawfully**

Question 104

# Leases What occurs when a tenant tries to create a sublease which is longer than his own lease?

Answer 104

No new lease is created, but the tenant's full lease will be assigned instead

Question 105

# Leases What is the required form of the assignment of a lease?

Answer 105

**Deed**, even if the lease is made orally

Question 106

# Leases What is the effect of an assignment by a tenant made in breach of the landlord's consent requirement?

Answer 106

The assignment is legally effective, but there is a breach of covenant on the part of the original tenant as with the landlord

Question 107

# Leases Are the covenants in the head lease usually enforceable against a subtenant, and why?

Answer 107

No, because there is no privity of contract or estate between the landlord and the subtenant

Question 108

# Leases Is a sublease affected by the assignment of a head lease?

Answer 108

No

Question 109

# Leases Who may serve notice to terminate where there are multiple landlords and multiple tenants?

Answer 109

Any of them

Question 110

# Leases What are the two ways the parties can *mutually* agree to bring a tenancy to an end?

Answer 110

1. **Surrender**: Parties agree tenant will give up possession to the landlord 2. **Merger**: Parties agree landlord will transfer reversion to the tenant

Question 111

# Leases If a head lease is ended by expiry, notice to quit, or forfeiture, does any sublease existing under it come to an end?

Answer 111

Yes

Question 112

# Leases If a head lease is ended by **surrender**, does any sublease existing under it come to an end? ## Footnote What about **merger?**

Answer 112

No, the **subtenant will become the tenant of the head landlord on the terms of the sublease** and will have to pay rent due under the sublease to the head landlord ## Footnote New owner of the estate *(usually the headlease tenant)* will hold the estate **subject to the sublease**, and the subtenant's position will be the same as with surrender

Question 113

# Easements and profits What are the three essential characteristics of an easement?

Answer 113

1. There must be a **dominant** *and* **servient** tenement 2. Easement must benefit the dominant **land**, not just the owner/occupier **personally** 3. Dominant and servient land must be in **separate ownership**

Question 114

# Easements and profits What are the two requirements for a legal easement or legal profit?

Answer 114

1. For equivalent of an absolute interest *(fixed period or forever, but not for life)* 2. Created by deed ## Footnote If no deed, equity may rescue

Question 115

# Easements and profits What two conditions must be met for equity to rescue a legal easement or profit not created by deed?

Answer 115

1. In writing incorporating all terms expressly agreed 2. Signed by both parties *Same as exception to **non**-short lease not by deed.*

Question 116

# Easements and profits What are the three ways an easement can be *created*?

Answer 116

1. Express grant or reservation *(legal)* 2. Implied grant or reservation *(equitable)* 3. Prescription *(legal)*

Question 117

# Easements and profits Under section 62 of the Law of Property Act 1925, what type of easements and profits will pass under statute even if not specifically mentioned in the transfer document (and why), and does this apply to **grant** and **reservation** (and why)? ## Footnote What are the two conditions for section 62 to apply?

Answer 117

Easements and profits **appurtenant** because they run with the land and cannot be transferred on their own. Just **grant**, because if the seller wanted to reserve them when selling a parcel of land, they easily could have *(same reason why implied easement generally can't help seller other than two exceptions)*. ## Footnote Grant must be within the power of the grantor, and there must be no contrary intention

Question 118

# Easements and profits When does implied grant or reservation arise, and what are the four types of easements which can arise impliedly?

Answer 118

When the parties have not expressly created necessary easements as part of the conveyance 1. Easements implied by necessity 2. Intended *(but not executed)* easements 3. Ancillary easements 4. Easements implied by existing use ## Footnote 1 and 2 are available to the grantor, in exception to the general rule that they should reserve whatever rights they need

Question 119

# Easements and profits 1. When will an easement be **implied by necessity**? 2. From what will an **ancillary easement** arise?

Answer 119

1. Where a parcel of land is **landlocked**, a right of way will be implied in order to access 2. From the realities of the situation, *e.g. a right to take water from a spring gives rise to an ancillary right of way to that spring*

Question 120

# Easements and profits What are the three requirements for an easement by existing use to be implied on sale/transfer?

Answer 120

Easement must: 1. Be **continuous** and **apparent** 2. Be **necessary** to the reasonable enjoyment of the land acquired 3. Have been **used by the seller for the benefit of the land** at the time of conveyance

Question 121

# Easements and profits What are the two requirements for an easement to arise by prescription?

Answer 121

Party has used the benefit: 1. Unchallenged for **20 years**, and 2. As of right, *i.e. without permission or making payment*

Question 122

# Easements and profits What is the status of an easement arising by common law prescription?

Answer 122

It is a **legal interest**

Question 123

# Easements and profits When will **legal** easements and profits bind a buyer in the (1) unregistered system and (2) registered system?

Answer 123

1. When they come into existence 2. When they are registered

Question 124

# Easements and profits In the registered system, what is the consequence of **not registering** a right which arises by express grant or reservation?

Answer 124

It will **not take effect as a legal interest**, and will not override an equitable interest

Question 125

# Easements and profits What is required for an **equitable** easement to bind a buyer in the unregistered system?

Answer 125

Registration as a D(iii) **equitable easement** land charge

Question 126

# Freehold covenants Is the original **burdened party** liable on the covenant even after the **sale of land by the person benefitting** from the covenant, and why? ## Footnote i.e. is the original burdened party liable to a successor, where the original burdened party remains?

Answer 126

Yes, under privity of contract, the person to whom the covenantee sells is essentially assigned the right to benefit from the covenant

Question 127

# Freehold covenants What typically determines if a covenant is enforceable between successors? ## Footnote i.e. where both parties have moved on and no original party remains

Answer 127

Whether it is a positive or restrictive covenant ## Footnote Positive generally only binds the original parties; restrictive can bind successors

Question 128

# Freehold covenants What are the four conditions for the **benefit** of a **restrictive covenant** to be enforceable by the successors of the original **benefitting party**, where the original burden party is gone? ## Footnote Remember, if the original burdened party is still in situ, a restrictive covenant remains binding on them

Answer 128

1. Covenant **touches and concerns the land***, i.e. benefits the land in the same way as an easement* 2. It was **intended to pass with the legal estate** held by the original benefitting party 3. The BP held the **legal estate** in the land to be benefitted **at the time the covenant was made**, and 4. The *successor* of the original BP **now holds the legal estate** ## Footnote *Essentially a privity of contract argument to transfer a benefit to the land, which was intended to run with the legal estate, to the person who now owns the legal estate*

Question 129

# Freehold covenants Is the **burden** of a restrictive covenant enforceable **in law** against a successor in title of burdened land?

Answer 129

No, but it may be enforceable in **equity** if: 1. The original benefitting party held the legal estate in the land to be benefitted when the covenant was made, and 2. Burden was intended to run with the land 3. Convenant is on the **charges register of burdened land** if *registered*, or **D(ii) restrictive covenant land charge** if *unregistered* ## Footnote Registration is only required to enforce in equity, as if it is a legal interest, e.g. restrictive covenant, it is binding on the world at large

Question 130

# Freehold covenants What are three of the ways of otherwise enforcing a **positive** convenant?

Answer 130

1. Grant a lease 2. Chain of indemnity covenants 3. Benefit and burden rule

Question 131

# Freehold covenants Why does a granting a lease allow a positive covenant to be enforced?

Answer 131

Because the burden of positive and negative leasehold covenants run with the land due to privity of estate

Question 132

# Freehold covenants How does a chain of indemnity covenants allow a positive covenant to be enforced?

Answer 132

The original covenantor and each successive successor in title obtain an indemnity covenant from the next buyer, so the liability is continually offset and primarily enforceable

Question 133

# Freehold covenants What is required for the rule that a person cannot accept a benefit without also accepting the burden, and what is a consequence of them failing to uphold a positive convenant?

Answer 133

The benefit and the burden must be **related to each other**, e.g. benefit of using a road paired with burden of helping fund its maintenance. Whilst the obligation to maintain is not enforceable against a successor, they can be denied use of the benefit.

Question 134

# Mortgages How must a legal mortgage be made?

Answer 134

By **deed** ## Footnote An unsuccessful attempt to create a legal mortgage will be rescued by equity, if the appropriate writing can be evidenced

Question 135

# Mortgages What are the three situations in which an **equitable mortgage** can be created?

Answer 135

1. Parties agree that mortgage should only be equitable 2. Contract in writing to create a legal mortgage, and there is no deed or the deed fails *(rescue)* 3. Mortgagor owns equitable interest only

Question 136

# Mortgages Regarding **registered** land, how is (1) a **legal** mortgage and (2) an **equitable** mortgage protected?

Answer 136

* **Legal mortgage** must be completed by registration, and has priority over competing interests *(unless previously registered or overriding)* * **Equitable mortgage** is protected by placing a notice or restriction on the property's register

Question 137

# Mortgages Regarding **unregistered** land, who has priority regarding mortgages?

Answer 137

The **first mortgagee**, because they will have custody of the title deeds

Question 138

# Mortgages Regarding **unregistered** land, how is (1) a **subsequent legal** mortgage and (2) an **equitable** mortgage protected?

Answer 138

* **Subsequent legal mortgage** is protected by registration as a C(i) puisne mortgage land charge * **Equitable mortgage** is protected by registration as a C(iii) general equitable land charge | Both are registered against the borrower's **name**

Question 139

# Mortgages Within what time period of a company creating a charge must it be filed with Companies House?

Answer 139

21 days

Question 140

# Mortgages What are the two main situations in which a third party may have an interest in land subject to sale?

Answer 140

1. Tenants 2. Co-owners, or non-owning occupants who contributed to the purchase price

Question 141

# Mortgages What **legal tenancies** in (1) unregistered system and (2) registered system will bind a mortgagee?

Answer 141

1. **Unregistered**: legal tenancies granted before the mortgage was created 2. **Registered**: legal tenancies not exceeding seven years ## Footnote A legal tenancy of registered land exceeding seven years must be registered in its own right to be binding

Question 142

# Mortgages What **equitable tenancies** in (1) unregistered system and (2) registered system will bind a mortgagee?

Answer 142

1. **Unregistered**: equitable tenancies registered as a C(iv) estate contract land charge 2. **Registered**: equitable tenancies not exceeding seven years, **and the tenant is in occupation** ## Footnote Tenant must be in occupation as this converts it to a legal interest, which is an overriding interest

Question 143

# Mortgages Where the mortgage deed prohibits creation of tenancies without mortgagee's consent, is the mortgagee bound by unauthorised tenancies?

Answer 143

No

Question 144

# Mortgages What is required where an institution is lending money secured by co-owned property, but the proceeds are to be used by only one of the co-owners for a separate purpose?

Answer 144

Other co-owner must be: 1. Separately represented by another solicitor, and 2. Given full financial information ## Footnote The other co-owner must understand the practical implications of the proposed transaction in a meaningful way

Question 145

# Mortgages What are four of the rights a legal mortgagee has once the mortgage is registered as a charge?

Answer 145

1. Sue for the debt 2. Take possession 3. Foreclose 4. Sell ## Footnote Equitable mortgagee has the same rights, with a different process for sale

Question 146

# Mortgages Whilst a legal mortgagee can usually always take possession, the presence of **what** on the land adds an additional requirement, and what is this step?

Answer 146

If there is a **dwelling** on the land, **possession can only be sought through the courts**

Question 147

# Mortgages What is the effect of **foreclosure**? ## Footnote When does the right to foreclose arise?

Answer 147

The mortgagee becomes the owner of the property via court order ## Footnote Same as right to sell, right to foreclose does not arise until after the contractual due date has passed *(usually six months after creation)*

Question 148

# Mortgages What are the three requirements, one of which is enough, for the power of sale to become exercisable? ## Footnote In addition to the contractual due date having passed

Answer 148

1. Interest payments more than **two months** in arrears 2. Written request for payment and **three months** has passed 3. Breach of any other term of the mortgage

Question 149

# Mortgages What is sale by a legal mortgagee under a power of sale subject to and what is it free of?

Answer 149

Subject to any **prior mortgages** Free of any interest over which the mortgage has priority, e.g. unprotected interests ## Footnote A legal mortgage also has priority over any subsequent legal mortgages. This means a buyer from a lender who has taken possession takes free of any other legal mortgages created after the one the property was repossessed under.

Question 150

Unless there is anything on the register to the contrary, what will a legal mortgage have priority over when it is entered on the register of title?

Answer 150

Any interest whose priority is not protected

Question 151

What two things will have priority over a properly registered legal mortgage in the registered system?

Answer 151

1. Charge registered before the mortgage, and 2. Overriding interest **if it existed before the mortgage**

Question 152

# Mortgages Whilst an **equitable mortgagee** will generally have the power of sale, what do they not have?

Answer 152

Power to convey or transfer the legal estate

Question 153

# Mortgages When an equitable mortgage in the registered system is protected by placing a notice or restriction on the property's register of title, what will the equitable mortgage have priority over?

Answer 153

Any later dealing with the legal estate, even a later legal mortgage

Question 154

# Mortgages For all legal mortgages in the unregistered system other than the first protected by the title deeds, what is the main factor in determining priority?

Answer 154

The date of registration as a legal charge

Question 155

# Mortgages What are the priority rules for equitable interests *(including equitable mortgages)* in both systems?

Answer 155

Generally, first in time has priority