Land Law

Question 1

Proprietary rights vs. personal rights
1. How to enforce
2. Who is it enforceable against

Answer 1

Proprietary rights -> enforced by action in rem (use/possession of land is recoverable) + enforceable against 3P

Personal rights -> enforced by personal action (damages) + enforceable against original parties

Question 2

Fixed list of proprietary rights x7 + criteria to be recognised as proprietary right

Answer 2

1. freehold estate
2. leasehold estate
3. easement
4. mortgage
5. restrictive covenant
6. estate contracts
7. interest in trust of land

• nature of right: substantive characteristics
• creation: formality req
• protection: registration

Question 3

What is an estate?
What is a freehold/ leasehold estate?

Answer 3

Estate = proprietary right of POSSESSION

Freehold = fee simple absolute in possession
Leasehold = term of years absolute

Question 4

What is an interest?

Answer 4

proprietary right of LIMITED USE (right to use / enjoy land or NOT to do something)

Question 5

Legal interests x3 + must be created by what? + remedies available

Answer 5

1. mortgages
2. easements (forever/certain)
3. rights of entry

Must be created by deed

AUTOMATIC right to damages + equitable remedies

Question 6

Equitable interest x4 + Remedies

Answer 6

1. easements (uncertain)
2. restrictive covenants
3. interests in a trust of land
4. estate contracts

Not entitled to damages as a right, only at court’s discretion

Question 7

3-steps for sale of freehold (registered land v unregistered land)

Answer 7

1. Exchange of contracts (voluntary) - parties become legally bound
2. completion of deed (standard form of transfer deed = TR1)
   a. unregistered land: conveyance -> legal title acquired at completion
   b. registered land: transfer

• buyer pays balance of purchase money to seller, seller moves out + hands keys to B

3. Registration
   a. unregistered land - trigger compulsory 1st registration within 2 months
   b. registered land - acquire legal title once registered

Question 8

Formalities for all land contracts

Answer 8

LP(MP)A, s2:
1. writing

2. expressly agreed terms
3. signed by both parties
   a. 1 doc signed by both parties; OR
   b. 2 identical doc signed by each party + exchanged

Question 9

formalities of a deed

Answer 9

1. intended to be deed
2. validly executed
   a. indv - signed by seller & witnessed
   b. company -
   2 directors/ 1 director + secretary & witnessed
   OR affix company seal
3. delivered / dated

Question 10

Varying a land contract

Answer 10

If material term (eg completion date) varied -> must comply with LP(MP)A, s2

Question 11

Types of land contracts
1. agreement for lease/ contract for lease

2. Option agreement
3. right of pre-emption

Answer 11

Agreement for lease / contract for lease:
1. landlord + tenant commit to enter lease in the future
2. used when premises not ready for immediate occupation, but parties want certainty that lease will be entered into

Option agreement:
1. right to serve notice of wish to BUY land during option period
2. if served -> seller MUST sell land to buyer, but buyer NOT obliged to buy

Right of pre-emption
1. right of first refusal to sale
2. land owner must first offer to right owner before sale, no obligation to sell, no ability of right owner to require land to be sold to them

Question 12

Criteria for failed legal estate/ interests to be recognisable as estate contract

Answer 12

1. comply with LP(MP)A, s2
2. remedy of specific performance ie C has clean hands + not breached any contractual terms

Question 13

Remedies for breach of estate contract

Answer 13

Common law remedy: automatic right to damages

Equitable remedies (court’s discretion - accounts both parties’ behaviour)
1. Specific performance (if C has clean hands)
2. Injunction

Question 14

Where to find title information - registered v unregistered land

Answer 14

Registered -> Land Registry’s register

Unregistered -> various title deeds

Question 15

ADV of registering land/ Land Registry’s register x3

Answer 15

1. each registered title has title plan (full extent of property + who is responsible for property’s boundaries)
2. ownership is guaranteed by the State (if incorrect, can claim compensation)
3. quicker to view + 3P interests are discoverable

Question 16

Triggering events for compulsory registration x6

Answer 16

1. transfer of freehold estate (sale/gift/court order)
2. grant of lease >7yrs
3. first legal mortgage (freehold/leasehold) with >7yrs left to run
4. assignment of lease of unregistered land with >7yrs left to run
5. transfers on death of freehold/leasehold with >7yrs to run
6. future leases ie grant of lease to take effect >3 months after date of grant

Question 17

Application of triggering events for compulsory registration -> unregistered v registered land

Answer 17

Unregistered land
1. FIRST registration
a. sale - 1 Dec 1990
b. death/gifts - 1 April 1998

2. VOLUNTARY registration (reduced registration fees)

Registered land
1. UPDATE the register - failure to register, transaction not legally recognised

Question 18

Principles of land registration x3

Answer 18

1. Mirror principle - register reflects all benefits/ burdens on property EXCEPT overriding interests (binding, but do not appear on register)
2. Curtain principle - register records legal title, not equitable title
3. Insurance principle - accuracy of register is guaranteed by the State

Question 19

Land Registry’s registers x3 + content

Answer 19

1. Property register
   - description of land (address) by ref to title plan
   - type of estate (freehold/leasehold)
   - rights BENEFITTING land
2. Proprietorship register
   - name+ address of landowner (registered proprietor)
   - RESTRICTIONS affecting registered proprietor’s ability to deal (eg sale/lease/mortgage)
   - Class of title
3. Charges register
   - Rights BURDENING land

Question 20

Different class of title on proprietorship register x4

Answer 20

1. absolute (best form of ownership)
2. Qualified - title defects
3. Good leasehold - title of leaseholder only
4. Possessory (adverse possession/ squatter rights) - may mean 3P interests created before date of 1st registration will bind property even if not noted on title

Question 21

Statutory definition of land x4

What airspace is included?

What ground is included?

Answer 21

1. surface (inc. mines + minerals)
2. buildings/ part of buildings
3. corporeal hereditaments (physical things attached to land) - ie fixtures
4. incorporeal hereditaments - benefit of proprietary rights

Airspace: only lower airspace necessary for ordinary use + enjoyment
- if structure overhangs = trespass
- NB: innocent aircraft is not trespass

Ground: up to 300m
- except gold, silver, treasure, coal

Question 22

Legal test: fixture or chattel?

And which does conveyance of land include?

Answer 22

1. DEGREE of annexation
   a. How object is attached - raises a presumption
   i. more firm = fixture - even if fairly easy to remove, prima facie fixture
   ii. rest on land by own weight = chattel
2. PURPOSE of annexation
   a. Takes priority over degree test - rebuts presumption
   b. Why object is attached
   i. Permanent enhancement of land/building = fixture
   - chattels incorporated into architectural design (eg stone garden seat/ ornamental statue)
   ii. Temporary & convenient use = chattel

Conveyance of land automatically includes all fixtures UNLESS specifically excluded in contract (eg Buyer and seller complete Form TA10)

Question 23

What is a mortgage?
who is mortgagee/ mortgagor?
Granted over what type of estate?

Answer 23

Bundle of proprietary rights granted to lender as security for loan

Lender = mortgagee
Borrower = mortgagor

Granted over freehold/leasehold estate

Question 24

Legal v Equitable mortgage
- what interest?
- Formalities

Answer 24

Legal mortgage
- proprietary interest + contractual debt
- Deed + Registered

Equitable mortgage
1. Mortgage of equitable interest
- writing + signed by grantor (mortgagor)

2. Defective legal mortgage -> contract to grant legal mortgage
   - comply with LP(MP)A,s2 + specific performance available

Question 25

Discharge of mortgages - whole / part of land

Answer 25

Mortgage repaid in full -> cancel mortgage entries at charges register
a. whole - DS1 form
b. part - DS3 form

Question 26

Legal date for redemption?

equity of redemption?

Answer 26

legal date for redemption - specified on mortgage deed when borrower fully repay loan -> if not, property forfeited to lender

equity of redemption -
1. loan can be repaid after legal date for redemption ie equitable right to redeem
2. protection from postponement / prevention of redemption + collateral advantages + unconscionable terms
- equity = market value LESS outstanding debt

Question 27

Equity of redemption - clauses postponing or preventing redemption? are they valid?

Answer 27

1. Cannot prevent redemption (ie early repayment of loan) totally
2. May postpone redemption if no clog/ fetter on equity of redemption

VALID IF:
a. estate being mortgage = FREEHOLD (enduring/ rarely loses value); not leasehold (depreciating asset)

b. borrower can get back what they mortgaged on redemption

c. deal favoured borrower - eg low interest rate in return for postponed redemption

Question 28

Equity of redemption - Options to purchase by lender? are they valid?

Answer 28

VOID if option granted at same time as mortgage

VALID if granted at same time/ in subsequent transaction but IF independent of mortgage

Question 29

Equity of redemption - collateral advantages for lender?

Answer 29

VOID if unconscionable (nature of penalty)

VALID if solus tie (adv in commercial transactions) if end within mortgage term

Question 30

Equity of redemption - Unconscionable terms?

Answer 30

Multiservice test - VOID if morally reprehensible manner
- if void, not enforceable on borrower, but remainder of agreement remain in force

VOID if
1. clear imbalance of bargaining power - eg residential tenant/ extending lease
2. If interest rate in event of borrower’s default > lender’s losses

VALID if
1. equality of bargaining power, even if enter bad bargain
2. lender can charge higher interest rate > market rate IF:
a. borrower = credit risk
b. lender’s own commercial needs eg financial difficulty

Question 31

Undue influence in mortgage loan
- 2 types
- Irrebutable presumption
- Burden of proof is on who? + what to prove x2
- Effect if undue influence is proven?

Answer 31

1. Acts of improper pressure/coercion
2. Taking advantage of influence one party has over the other in a relationship
   a. Irrebutable presumption of influence = parent/child, trustee/beneficiary, solicitor/client
   b. Need to positively prove influence exists = parent/adult child, husband/wife

Burden of proof = party alleging undue influence
1. relationship of trust and confidence (or irrebutable presumption)
2. transaction which requires explanation (suspicious type/ high value - NOT spouse offering interest in matrimonial home as security for loan for spouse’s biz -> need to prove unfair advantage taken of rs)

EFFECT =
- contract / gift by deed set aside at court’s discretion
- mortgage unenforceable against borrower + lender not able to exercise right to possess/ power of sale
UNLESS
1. delay in making claim
2. C no clean hands

Question 32

How can lender avoid risk of undue influence when one party in non-commercial setting standing as surety for other party?

Answer 32

Etridge guidelines
1. LENDER put on inquiry / notice of undue influence to be protected from future claims / risk of undue influence
a. write to party not benefitting from mortgage + ask them to nominate independent solicitor to explain transaction
b. must not lend until confirmation received from solicitor

NB: lender is not put on inquiry if purpose of loan for joint benefit of co-owner (eg holiday cottage)

2. INDEPENDENT SOLICITOR must:
   a. meet non-benefitting party on their own + in person
   b. explain transaction
   c. keep detailed attendance note + confirm in writing
   d. send certificate to bank