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Land > L6: Co-ownership > Flashcards

L6: Co-ownership Flashcards

1
Q

What is co-ownership?

A

Where 2 or more people own land at the same time

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2
Q

Main statutes for co ownership

A

LPA 1925
TOLATA 1996

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3
Q

What are the fundamental features of co ownership

A

Unity of possession & Trusts

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4
Q

What is unity of possession

A

Each co-owner enjoys entitlement to possess co owned land.

No unity of possession = no co ownership

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5
Q

What are the 2 forms of co ownership

A

Joint tenancy and tenancy in common

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6
Q

What is a joint tenancy?

A

Each co owner is wholly entitled to land
no single owner has a share irrespective of their contribution to purchase price

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7
Q

What are the 4 unities?

A

1) Possession
2) Interest
3) Title
4) Time

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8
Q

Possession

A

Co owners must enjoy entitlement to possess the whole of co owned land
No single co owner is permitted to exclude another from either part or entirety of co owned land (Wiseman v Simpson)

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9
Q

Interest

A

Co owners must hold same identical interest in the land

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10
Q

Title

A

Co owners must acquire identical interest from the same act, transaction or document (e.g. from the same conveyance, transfer or adverse possession)

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11
Q

Time

A

Co owners must have acquired interest at the same time
If one co owner acquired interest at a later date, there is no unity of time

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12
Q

What is the doctrine of survivorship?

A

When one JT dies, interest automatically passes to remaining JT’s
Surviving JT -> outright owner

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13
Q

When does survivorship operate?

A

On death
Interest does not pass under intestacy rules

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14
Q

What if it is uncertain as to who died first?

A

S184 LPA 1925
Seniority prevails
Older in years presumed to have died first

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15
Q

What happened in Scarle v Scarle

A

Husband and wife found death
Medical evidence unclear as to order
Presumption led to the result that the wife survived the husband

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16
Q

What is severance?

A

Mechanism by which JT can separate their interest from other JT’s
JT’s interest transformed into notional share, becoming a tenant in common

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17
Q

What happens to the remaining co owners when one JT decides to sever the joint tenancy?

A

Remaining co owners continue to be joint tenants

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18
Q

How is the size of the share calculated?

A

in proportion to the remaining JTs’ interests

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19
Q

What happens to the share of the co owner that severed their interest

A

Survivorship doesn’t operate
Co owner free to bequeath her interest to her heirs

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20
Q

Does survivorship operate under a tenancy in common?

A

No

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21
Q

What is a tenancy in common?

A

Co-owner is entitled to a notional or undivided share in land
May leave it to their heirs upon death
Able to sell their share or mortgage it

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22
Q

Are the 4 unities required for co ownership?

A

No- only unity of possession is required

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23
Q

What is the position at law for co ownership?

A

Co-ownership can only exist legally under a JT
No tenancy in common at law - s1(6) LPA 1925

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24
Q

What is the max number of people who can exist as co-owners over a parcel of land?

A

s34(2) LPA 1925 - 4

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25
Q

What happens where legal title is conveyed to more than 4?

A

s34(2) - first 4 people named on the conveyance (of full age) who will be registered as legal co owners

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26
Q

Which factors determine whether co owners are joint tenants or tenants in common?

A

Express declaration of trust
Presence of 4 unities
Application of various equitable presumptions

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27
Q

Facts of Goodman v Gallant

A

Mrs G and her husband bought a house conveyed into Mr G’s sole name
Agreement that Mrs G was entitled to a 50% share in the beneficial interest
Marriage broke down
Later, the defendant Mr Gallant began living with Mrs G
Mr Goodman conveyed freehold estate to Mrs G and Mr Gallant to hold the same unto the purchasers in fee simple as beneficial joint tenants
Mrs G severed JT, seeking determination of their beneficial interests
G claimed she was entitled to ¾ of the beneficial interest

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28
Q

What did the court find in Goodman v gallant?

A

Where a conveyance contains an express declaration of trust that makes clear the parties are to hold property as joint tenants, express statement is exhaustive & conclusive
Severance = tenancy in common in equal shares
Mrs G entitled to 50% of beneficial interest

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29
Q

What if there is no express declaration as to how the property is held in equity?

A

Words used in conveyance may indicate nature of co ownership
E.g. words of severance indicative of a tenancy in common
E.g. to be divided, in equal shares

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30
Q

What is the presumption where the 4 unities are present?

A

Suggests that the land is held under a joint tenancy
If they are not present -> TiC

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31
Q

What are 6 equitable presumptions where there is no express declaration of trust?

A

1) Given there can only be a joining tenancy at law, there will also be a joint tenancy at equity
2) Equity prefers a tenancy in common
3) Unequal contribution to purchase price presumes TIC
4) Mortgage loans from 2 or more mortgagees presumes mortgagees hold an interest in common
5) presumption that business partners hold land as tenants in common
6) Lease of business premises holds the presumption of a TIC

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32
Q

Facts of Malayan Credit v Jack-Chia-MPH

A

2 business took out a lease of office block
Dispute arose
JC applied for sale of the lease, seeking equal share of proceeds
Issue: did they hold under JT or TIC
Court: businesses had agreed unequal share of floor space & meticulous unequal division of liabilites as to rent & SC = TIC in equity in unequal shares

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33
Q

What is severance?

A

The process by which a joint tenant is converted into a tenant in common

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34
Q

Definition of severance in Harris v Goddard

A

Severance … is the process of separating off the share of a joint tenant, so that the concurrent ownership will continue but the right of survivorship will no longer apply. The parties [who have severed] will hold separate shares as tenants in common.

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35
Q

Why would JT wish to sever?

A

Avoid survivorship
Access shares in co owned land

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36
Q

Qualifications of severance

A

Must take place before the death of JT - cannot be effected by will Carr v Isard
Burden of proof on severing party to prove effective severance
Severance can’t be undone

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37
Q

What are the 5 methods of severance?

A

By written notice s36(2) LPA 1925; Goodman; Harris; Kinch
Joint tenant operating on own share by written notice; Re Draper’s Conveyance
By mutual agreement; Burgess v Rawnsley
By mutual course of dealing; Greenfield v Greenfield
Forfeiture; Forfeiture Act 1982; Re K

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38
Q

What are the requirements for severance by written notice?

A

s36(2) LPA 1925
JT can sever without consent of other co-owners
JT must make desire to sever clear in a written notice
JT must serve the notice on all other JT’s

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39
Q

What amounts to an effective notice?

A

No requirement in statute that the notice must contain signature of JT (Re Draper’s Conveyance)
Written notice must express immediate intention to sever (Harris v Goddard)

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40
Q

In Goodman, how was a clear & immediate unequivocal intention to sever illustrated?

A

I hereby give you notice of my desire to sever as from this day the joint tenancy and equity of and in [the co-owned land] now held by you and me as joint tenants both at law and in equity so that the said property shall henceforth belong to you and me in equal shares.

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41
Q

The facts of Gore and Snell v Carpenter

A

Husband & Wife equitable joint tenants of 2 homes
They separated- husband’s divorce solicitor instructed to draw up a separation agreement referring to severance
Draft agreement served on wife - in draft & not formally accepted by both sides
Husband refused to serve notice fearing it would damage prospects for divorce negotiations
Husband died before final separation agreement was reached
Court held there was no clear, unequivocal, immediate intention to sever JT
Wife entitled to 100% of equitable ownership under survivorship

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42
Q

What happened in Re Drapers Conveyance?

A

Husband & wife co owners of matrimonial home
Held property as JT at law and in equity
Marriage broke down- they divorced
Wife issued summons that the house be sold & proceeds be divided equally between them
Court made an order for sale, husband died prior to the sale

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43
Q

What was the legal issue in Re Drapers Conveyance?

A

Had severance taken place?
Yes = wife entitled to 50% share of sale
No = wife entitled to entire beneficial ownership under severance

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44
Q

Judgment of Re Drapers Conveyance

A

Equitable joint tenancy had been severed when wife issued her summons to court
Amounted to a written notice of severance clearly evincing an intention that she wished the property to be sold & proceeds distributed in half
JT was severed

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45
Q

What happened in Harris v Goddard?

A

Married couple JT
Marriage broke down- wife petitioned for divorce
Wife sought order for the home as may be just
3 days before court hearing, husband died in a car crash

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46
Q

What was the legal issue in Harris v Goddard?

A

Did the divorce petition constitute an effective notice of severance?
Or was there no severance -> operation of survivorship to the benefit of the wife?

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47
Q

What was the judgment of Harris v Goddard?

A

Divorce petition failed to demonstrate immediate intention to sever JT
Wife entitled to 100% of ownership

48
Q

Why did Re Drapers & Harris v Goddard reach different conclusions?

A

HvG lacked immediacy

49
Q

When is a written notice served on all other existing joint tenants?

A

S196 LPA 1925
When it is left at the JT’s last known address or place of business
Where delivery is made by post, it is served when it would in the ordinary court be delivered

50
Q

Does notice have to be read and received by the other JT’s?

A

No- mere delivery is sufficient

51
Q

What happened in Kinch v Bullard?

A

Mr and Mrs J married & co owners of a matrimonial home at law and in equity
Marriage broke down, Mrs J (terminally ill) petitioned for divorce
Mrs J sent written notice of severance by ordinary first class post
Mr J suffered a heart attack and underwent a hospital stay
Mr J had not seen the notice, but it had been delivered
Mrs J likely to outlive Mr J- she did not wish to sever JT
She destroyed the letter, Mr J died in hospital

52
Q

What was the judgment in Kinch v Bullard?

A

Written notice had been served
Subsequent destruction had no bearing on severance
Tenancy had been severed
If Mrs J had revoked her notice via communication to Mr J before the letter had been delivered -> no severance

53
Q

How can severance take place through a unilateral act of a joint tenant operating on her own share?

A

Under the Hensman Catalogue
Where a JT carries out an act demonstrating an intention that her interest in the co owned land constitutes a share => severance (acting on one’s own share)

54
Q

What constitutes a JT operating on their own share?

A

JT transfers their interest to a third party = alienation
May be via sale or by gift
Equity treats as done that which ought to be done - specifically enforceable contract for sale/transfer of JT’s interest = severance Caldwell v Fellowes

55
Q

How can a JT transferring their interest to another JT be an act of severance?

A

One joint tenant may wish to buy out another JT
JT purchasing the additional ‘share’ becomes a tenant in common to the newly acquired interest but remains a JT as to their original interest

56
Q

How can a mortgage sever a JT?

A

Bedson- a mortgage or charge of an equitable joint tenant’s interest operates as an act of severance
Specifically enforceable contract for a mortgage = act of severance

57
Q

What is the position on severance where a JT fraudulently purports to transfer/grant mortgage of the whole property?

A

No single co owner can grant a mortgage over the whole property- requires agreement of all legal owners
Disposition will not be valid if they attempt to do so
Entry made in the register will be corrected
s63(1) LPA 1925
Actions of a sole equitable JT will sever their own interest even where they have committed fraud

58
Q

What was the effect of the husband’s actions in First National Security v Hegerty?

A

Married couple were co owners = retirement home
They were equitable JT’s
Relationship broke down- husband forged signature on a legal charge for security for a loan
Actions of husband = disposition of husband’s own share and a sufficient act of alienation to sever beneficial joint tenancy, converting husband and wife into TIC
Disposition created an equitable charge over husband’s share enforceable by the mortgage lender

59
Q

What happens where all JT’s band together to grant a legal mortgage over the property?

A

No severance- their coming together impacts legal estate only, not the equitable position C v S

60
Q

Can a commencement of legal proceedings by one JT against other JT’s suffice as effective severance?

A

Nielson-Jones v Fedden- unilateral declaration is insufficient for effective severance

61
Q

What happened in Burgess v Rawnsley?

A

Conveyance declared they held JT ine equity
Mr H intended for them to be married
Mrs R had no desire to marry, had intended to live upstairs, Mr H downstairs
Oral agreement was reached that Mrs R would see her interest to H for £750
Mr H’s solicitor wrote to Mrs R to confirm, on reflection she adjusted the price upwards of £1000
Mr H took no further action
3 years later, H died
Burgess (H’s daughter), argued severance had taken place- survivorship did not operate, that estate was entitled to 50% ownership
Court: agreement for the sale of her interest = severance
Whilst s40 LPA 1925 states a contract for the sale of an interest in land must be in writing, the absence of such was immaterial
Agreement = common intention to sever

62
Q

How can severance occur by mutual agreement?

A

Operates only where all equitable JT’s agree to sever

63
Q

What happened in Burgess v Rawnsley?

A

Mr H and Mrs R bought a house in joint names where Mr H lived
Conveyance declared they held IT in equity
Mr H intended for them to be married
Mrs R had no desire to marry, had intended to live upstairs, Mr H downstairs
Oral agreement was reached that Mrs R would see her interest to H for £750
Mr H’s solicitor wrote to Mrs R to confirm, on reflection she adjusted the price upwards of £1000
Mr H took no further action
3 years later, H died
Burgess (H’s daughter), argued severance had taken place- survivorship did not operate, that estate was entitled to 50% ownership
Court: agreement for the sale of her interest = severance
Whilst s40 LPA 1925 states a contract for the sale of an interest in land must be in writing, the absence of such was immaterial
Agreement = common intention to sever

64
Q

How can severance take place by mutual course of dealing?

A

When all JT’s act in a manner demonstrating that they regard themselves entitled to specific shares -> severance Williams v Hensman
A consensus between the joint tenants, disclosed by a pattern of dealings with the co-owned property, which effectively excludes the future operation of survivorship.

65
Q

Can severance take effect by ongoing negotiations? Does this = a mutual course of dealing?

A

Case law suggestive that it is challenging for inconclusive negotiations to amount to a mutual course of dealing
Ongoing or incomplete negotiations will only give rise to severance where the agreement, had it been reached, would have operated to sever JT Hunter v Babbage

66
Q

Can a JT unilaterally sever a JT by leaving her interest to heirs in a will?

A

No
Making of mutual wills suffices as a mutual course of sealing- where all JT’s execute mutual wills Estate of Heys

67
Q

Does the physical division of land = severance?

A

Greenfield v Greenfield - physical division does not necessarily = severance
2 brothers purchased a house as JT at law and in equity
Lived with their mother who died
Brothers were both married, so converted the house into maisonettes
One brother lived in upper half, the other in the lower
No notice of severance served, no evidence from the brothers that they considered the conversion to impact the JT
For wife of the deceased brother to be entitled to 50%, there had to be severance of JT
Held: physical division, conversion and separate occupation not inconsistent with the continuation of the JT
No severance had taken place- interest passed onto surviving brother who was wholly entitled to the land
Onus on the wife to establish severance
Severance will only amount to a mutual course of dealing if there is evidence of a common mutual intention

68
Q

How can a JT be severed by forfeiture?

A

Where one JT is responsible for unlawfully killing another JT, s1 Forfeiture Act 1832 prevents JT responsible from benefiting under the doctrine of survivorship
The unlawful killing severs the JT

69
Q

What types of unlawful killing does the forfeiture rule apply to?

A

Where one JT murders another JT Cleaver v Mutual Reserve Fund Life Association
Applies to cases of manslaughter Re Estate of Hall
Gray v Barr- forfeiture operates where a JT is guilty of deliberate, intentional and unlawful violence or threats of violence
Has been held to operate in cases of assisted suicide RE Ninian
On the balance of probabilities, JT was responsible for the killing is all that is required

70
Q

Does the forfeiture rule sever a JT?

A

s2(1) - court can offer relief if they are satisfied having regard to the conduct of the offender, that the justice of the case requires the rule to be so modified
S5- relief unavailable for convicted murder

71
Q

Examples of relief from forfeiture

A

Re k
Relief granted where one JT killed the sole JT (her husband)- wife had suffered prolonged and serious DV and had only intended to threaten her husband with a gun rather than fire it
Dunbar v Plant
Relief granted in a failed suicide pact resulting in the death of only one of the two joint tenants

72
Q

What are the stages for severance by forfeiture?

A

Does the forfeiture rule in s1 1982 apply?
Should relief be granted? If so, should the forfeiture rule be disapplied in part or in total?

73
Q

What are the methods for terminating a co ownership?

A

Unity of co owned land in 1 JT
Under the doctrine of survivorship, where land comes into sole ownership of a single JT, trust of land is terminated, entire estate passed onto surviving JT
Purchase of the legal estate taking free of the trust of land
Where legal estate is held on trust & sold to a third party who takes free of the trust of land via overreaching
Proceeds of sales are paid to two or more trustees ss.2 & 27 LPA 1925
Purchaser overreaches equitable interests
Co owners interests converted into proceeds of the sale
Partition of co owned land
Physical division of land and transfer of each plot destroys unity of possession s7 TOLATA - consent of beneficiaries required before partition
There can only be partition if
B’s are of full age
B’s are absolutely entitled to the land
B’s hold co owned land as tenants in common

74
Q

What happened in Re Evers’ Trust?

A

Couple who had bought a home had split, the woman remained in the property with 3 children
Court refused order of sale as the property had been purchased to provide a home for the family children for the indefinite future

75
Q

What does s 1 TOLATA say in relation to any trust consisting of land?

A

Must take effect as a trust of land, whether via express or implied creation by way of resulting or constructive trust

76
Q

What are the powers and duties of a trustee?

A

S6 TOLATA
(1) have all the powers of an absolute owner for the purpose of exercising their functions as trustees
Must act with regard to the rights of B, in a manner which does not contravene rules at law or equity & subject to a duty of care when exercising their powers
(3) given the power to acquire freehold/leasehold either as an investment, occupation by B or any other reason in accordance with s8 Trustee Act 2000

77
Q

What are the exceptions to a trustee’s powers?

A

s8(1) TOLATA
Express creation of a trust -> restriction of ss. 6 & 7 TOLATA
s8(2) TOLATA
Disposition creating a trust of land can include a requirement that consent of B’s be obtained before ss.6 & 7 powers can be exercised
S11 TOLATA
Trustees under a duty to consult B’s when exercising any of their functions relating to land, as far as is practicable and consistent with the general interest of the trust, give effect to B’s wishes

78
Q

what are the rights of beneficiares?

A

The right to be consulted; the right to occupy co owned land s3 TOLATA

79
Q

What is the s11 TOLATA right to be consulted?

A

B enjoys the right to be consulted by T exercising any function in relation to co owned land
Right only applies to B’s of full age entitled to possession of land
T only has to consult B so far as is practicable
Where B is consulted, T must give effect so far as is consistent with the general interest of the trust
Where B disagrees, T can give effect to the wishes of the majority of B’s
Duty to consult can be excluded by the terms of an express trust
Duty to consult inapplicable to trusts existing at the time 1996 Act came into force

80
Q

What is the s12 TOLATA right to occupy?

A

Arises where 2 requirements are satisfied
s12(1) - purpose of the trust was that the land was intended for the occupation of B (where the terms make it clear land was held purely as an investment or imposes duty on T to sell land, precludes occupation)
s12(2) - must be shown that land is suitable for occupation by B

81
Q

How was suitability to occupy defined in Chan Pui Chun v Leung Kam Ho?

A

‘suitability’ for this purpose must involve a consideration not only of the general nature and physical characteristics of the particular property but also a consideration of the personal characteristics, circumstances and requirements of the particular beneficiary.
E.g. farm land unsuitable for a non farmer B

82
Q

What happens if the right to occupy has arisen?

A

s13(1)
Where 2 or more B’s are entitled to occupy co owned land, T is permitted to restrict or exclude the right to occupy of any one or more B’s

83
Q

What are the 5 key aspects of s13?

A

In restricting the right to occupy, T must neither unreasonably exclude any B’s entitlement to occupy land nor exclude such entitlement to an unreasonable extent
In exercising the power to exclude or restrict, T must have regard to the intentions of the person who created the trust, purpose and circumstances of B
T can impose reasonable conditions of B’s in relation to their occupation and conditions may include paying outgoings or expenses in respect of the land / assuming obligations in relation to activities on land
Where B’s right to occupy is excluded/restricted, conditions may be imposed on other B’s including paying compensation to the excluded
T’s powers cannot be used to exclude any occupants or exercised in a manner likely to result in any such person ceasing to occupy the land

84
Q

What happened in Rodway v Landy?

A

Doctors R & L entered into a business partnership
They purchased a property in joint names at law and equity
Existing building was demolished- surgery from which both doctors practiced was constructed
Dispute -> partnership ending
R sough court order for winding up of partnership and sought to purchase the entire property
L counterclaimed seeking that property be partitioned under TOLATA or doctors exercise s13 powers to restrict the other’s right to occupation
Court: order under s13 directing that the property be divided into 2 units with each enjoying exclusive occupation of one unit

85
Q

What does s 14 TOLATA provide for resolving disputes involving co owned land?

A

Court with jurisdiction can hear disputes involving co owned land

86
Q

Who can make an application under s14?

A

Anyone with an interest in land subject to a trust

87
Q

Limits of a courts jurisdiction under s 14 TOLATA

A

Court cannot appoint or remove trustees
Court cannot order T to exercise a power which they do not have

88
Q

What happened in Bagun v Hafiz?

A

B the sole registered owner of a 4 bed house in london & lived with her 2 eldest son
Sons both made financial contributions to the purchase price of the house and subsequent mortgage instalments
Sons married - one son decided to leave
Mrs B decided to make a declaration of trust under which each son was declared to be an equitable tenant in common with ⅓ share in the property
Dispute arose as to the sale of the property
Judge- had no jurisdiction to order one of the sons to sell the property
Court made an order directing trustees to sell the trust property on terms that the brother seeking sale would be given first opportunity to buy the property at a price determined by the court

89
Q

What does s15 (a) TOLATA direct courts to factor in when resolving disputes?

A

The intentions of those who created the trust 15(a)
Only identifiable intentions at the time or before the trust was created can be taken into account by the court
May be express, oral or by written evidence by the parties or capable of inference by the court
Re Buchanan-Wollaston
Sea front promenade was conveyed to 4 individuals as JT
Clear in the deed the conveyance was made to avoid depreciation in market value of the parties’ adjacent properties
Land could only be dealt with by way of majority vote
Court held that the purpose of the trust was obvious- no sale should be ordered that would work against the clear and unequivocal expression in the deed

90
Q

What will the courts take into account when considering the purpose for which the land subject to the trust is being held? S15 (b) TOLATA

A

The purpose for which the land subject to the trust is being held
Court will consider whether the initial purpose has been fulfilled, exhausted or is no longer capable of being achieved
White
Property purchased by a couple who had not intention at the outset that it was to be a family home
Couple subsequently had children- court found no agreement that the purpose for the property had changed

91
Q

What happened in Jones v Challenger?

A

Husband and wife purchased a lease with 10 years left to run as JT
Marriage broke down - pair divorced
Wife left the matrimonial home, husband remained in possession of the property
Wife requested a sale of the lease, husband refused
Wife applied to court s30 LPA 1925 seeking sale
Court: ordered property to be sold - when the marriage failed, the purpose dissolved, was no longer alive

92
Q

What will the courts take into account when considering the welfare of associated minors? S15 (c) TOLATA

A

The welfare of any minor occupying or who might reasonably occupy the land as home
Age of the minor will be a relevant factor

93
Q

What happened in Williams v Williams?

A

Husband & wife co owners of a family home with their 4 children
Marriage broke down- couple divorced
Wife remained in the house with the children, husband moved out
When the oldest child was 12, husband decided he wanted to sell the house
Court refused to order the sale

94
Q

What is the presumption under a trust for sale?

A

Presumption in favour of sale Re Mayo

95
Q

What are the rules governing a creditor’s interests in relation to co owner disputes?

A

s15(1)(d) TOLATA- interests of any secured creditor of B to be taken into account by the court

96
Q

What was the general rule in regard to a creditor’s interest in relation to co owners disputes Pre tolata ?

A

Pre TOLATA
Creditor’s interests trumped those of the B and their children
Lloyds bank v Byrne and Byrne
Husband and wife co owners of a matrimonial home
Husband secured against the property a debt of 25k relating to his co
Bank obtained a charging order against the property
When the debt was not paid, bank sought am order for sale of property under s30 LPA
Court: No distinction between a trustee in bankruptcy & the bank
sale would be ordered in the absence of extraordinary circumstances

97
Q

What happened in Mortgage Corp v Shaire?

A

House purchased as a family home in which Mr Fox, Mrs Shaire and Mrs S’s son were to live
Mr F & Mrs S held the property in joint names
Without Mrs S’ knowledge, Mr F twice mortgaged the house by forging her signature
F fell into arrears, subsequently died
Mortgage lenders (Morgage Corp) made a s14 application for possession and sale of the property
Court: s15 was only one of the 4 factors to be considered by the court- interests of the creditors alone were not decisive
Considering the other s15 factors, court decided that Mrs S would not be an enormous hardship, mortgage was converted into a loan of 25% of property value
Debt was paid, Mrs S was entitled to entire beneficial ownership of the property

98
Q

What happened in Bank of Ireland Home Mortgages v bell ?

A

Property acquired to provide family home for husband, wife and son
Husband, without wife’s knowledge, mortgaged the property
Husband fell into arrears
Marriage broke down - bank sought possession and sale of the property
At the time of the sale application, the son was almost 18
On account of the facts( initial purpose to provide a family home rejected, sons age immaterial, debt owed increased daily) court was persuaded to order sale of the property

99
Q

What happened in Edwards v Lloyds TSB?

A

Mr and Mrs Edwards co-owned a property in which they lived as their matrimonial home
Mr E forged wifes signature to secure a mortgage against the property
Marriage broke down- E absconded (could not be located)
Mrs E remaining living in the property with the children
Bank brought an application for sale of the property
Court: found that immediate sale would be unacceptably severe to the wife and hcildren - purpose prevailed
Order for sale postponed until youngest of Mrs E’s children turned 18

100
Q

Why were the decisions made in Edwards vs bell conflicting?

A

In Bell, the debt was spiralling, at the time of the application there was insufficient value to cover the debt (court sympathised for the creditor)

101
Q

what statute governs situations where co owner is bankrupt

A

Insolvency Act 1986

102
Q

When does the insolvency act operate?

A

When the co owner is actually insolvent, not merely heavily indebted

103
Q

What happens when a co owner becomes bankrupt?

A

S306 IA - estate is vested in a trustee in bankruptcy
T’s job to realise co-owners property to cover as far as possible, the debt owed to the co owners creditors

104
Q

What if one of the co owners goes bankrupt but the other’s don’t?

A

S14 TOLATA can be raised to bring an action for sale of the land

105
Q

What is the relevant statute governing applications in bankruptcy concerning the co owned land, and what is an important factor in determining how the court will resolve the dispute?

A

s335A IA
Timing- distinction between aplications made leass than 12 months after vesting of bankrupt’s estate in the trustee in bankruptcy and those made more than 12 months after vesting

106
Q

Applications for sale made less than 12 months since bankruptcy

A

Courts will consider factors listed in s.335A(2)
Court will balance competing interests of: bankrupt’s creditors against the conduct of any spouse, civil parner, former spouse/CP contributing to the bankruptcy; needs of any spouse, children & all other circumsntances other than the needs of the bankrupt

107
Q

What does S335A(2)(C) IA require courts to disregard?

A

ss35a(2)(c) requires the court to consider all circumstances other than the needs of the creditor

108
Q

Applications for sale made more than 12 months since bankruptcy

A

s335a(3) court assumes the interests of bankrupt’s creditors outweigh all other considerations unless exceptional circumstances apply

109
Q

What are exceptional circusmtance s 335 (A)(3)

A

Requires something more than the melancholy consequences of debt Re Ciltro
Re Bremner- circumstances are only exceptional where they lie wholly outside the range of problems commonly associated with bankruptcy

110
Q

Case law examples as to what an exceptional case consisted of

A

Bankrupt’s daughter with mental age of 8-9 yr old, mobility problems and OCD (Grant v Baker) sale postponed for 12 months
B’s husband with autoimmune condition affecting msucles, requiring ventilator and zimmer frame (Pickard v Constable) sale postponed for 12 months
B with various chronic conditions relating to stroke and diabetes (Everitt v Budhram) Sale postponed for 12 months

111
Q

How can a purchaser protect her position when purchasing co owned land (to make sure land is free of pre existing equitable interests)

A

via the doctrine of overreaching

112
Q

What is the effect of overreaching?

A

Purchaser need not concern herself with the trust - acquires land entirely free of equitable interests

113
Q

How is overreaching satisfied in co owned land?

A

Where co owned land is held by at least 2 JT, overreaching is satsified provided the purchaser deals with at least two of these legal owners

114
Q

What of equitable interests under a trust of land that hasn’t been overreached?

A

Governed by doctrine of notice - Kingsnorth Finance v Tizard
Registered land- determined on the basis of sch 3, para 2 LRA 2002 if the interest holder satisfies the requirements of an overriding interest

115
Q

How are purchasers protected in unregistered land?

A

S16 TOLATA
If T convey co owned land without having regard to the rights of or without consulting b, under s 16 the purchaser will not be affected by these breaches

116
Q

How are purchasers protected in registered land?

A

S26 LRA 2002
Any limitation on the powers of registered co owners are intended to be contained in a restriction entered on the register- where any limitations have not been entered, purchaser will not be affected

Land (9 decks)

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