Land Law - Easements, Freehold Covenants, Mortgages Flashcards
Easements: Essential Characteristics
A right over one piece of land which benefits another piece of land
Essential characteristics set out in Re Ellenborough Park
- Must be a dominant and servient tenement: servient = burdened land and dominant = benefitted land
- Must benefit the dominant tenement - cannot just be a personal right
- Two pieces of land must be sufficiently proximate
- Separate ownership (i.e. cannot have a right over your own land)
- Capable of being an easement
- Cannot deprive the servient landowner of possession of their land
- Do not require permission
- If land owner incurring expense to maintain the right this is likely to be too onerous to be an easement
Easements: Acquisition
Express Easements
Legal easements must be created by deed and can be created for a fixed period or for an indeterminate duration
Can be express grants or express reservations
Grant = if land being sold requires any rights over the land being retained. Specified in deed or transfer.
Reservation = reserved in sale/purchase (land owner reserving the easement for them on sale/purchase)
Implied grant or reservation
- Necessity: e.g. if piece of land has no right of access unless over another piece of land the law might imply a right of way by necessity. Only rights of way can be implied by necessity.
- Common intention: applies where parties have a specific shared intention of how the land should be used by impossible to use the land for that purpose without the easement
- Ancillary: arises from the realities of the circumstances
- Rule in Wheeldon v Burrows: only applies to grants. Applies where landowner sells off part of their land (i.e. the dominant and servient land previously held by one owner) - right must be continious and apparent, right must be necessary for reasonable enjoyment of the land and the right must be in use at the time of the transfer.
- Statutory (s.62 Law of Property Act 1925): grants only, must be prior diversity of ownership, right must be continous and apparent. If so, right becomes an easement on conveyance.
Prescription: right must have been used unchallenged for 20 years or more and been used ‘as of right’
- Common law prescription: creates a legal interest
- By ‘Lost Modern Grant’: creates a legal interest
- By the Prescription Act 1832
Freehold Covenants
Two types: restrictive and positive convenants
Look at what needs to be done to comply with the covenant - just because a covenant starts with the word ‘not’ it doesn’t necessarily mean it is restrictive
The land over which the covenant has been imposed bears the burden and the land which imposed the covenant enjoys the benefit
The benefit of a covenant is enforceable by successors in title provided that:
- Convenant touches and concerns the land;
- Parties must have intended the covenant to run with the land (implied by statute unless expressly excluded);
- At the time covenant made the covenantee must have held a legal estate in land to be benefitted;
- Assignee of the original covenantee must hold a legal estate
Benefit of covenant is also enforceable by successors of title in equity
Under common law the burden cannot pass to the successor of burdened land (unless the convenantor gets a benefit as well as a burden)
In equity the burden can pass to the successor of burdened land if:
- Covenant is negative in nature;
- Covenant touches and concerns the land held by covenantee;
- Burden intended to run (implied by statute); and
- Sufficient notice (see registration rules)
Therefore, positive convenants affecting freehold land cannot pass in equity
Indemnity covenant: seller enters into an arrangement with buyer that they will indemnify seller for any breaches of convenant (due to privity of contract, buyer is not liable)
A rentcharge can secure positive obligation to pay for upkeep of communal areas on residential developments (useful if chain of indemnity is broken)
Mortgages
Creation
- Legal mortgage must be made by deed
- Most common method of creation is a mortgage created by way of legal charge
- Equitable mortgage can also be created
- If mortgagor owns equitable interest only an equitable mortgage is all that can be created
Protection
- Legal mortgage of registered land: a registrable disposal
- Equitable mortgage of registered land: protected by placing a notice on the property’s register of title
- Legal mortgage of unregistered land: protected by deposit of the title deeds as security for the loan (if there are multiple mortgages on unregistered land the second mortgage would be a puisne mortgage)
- **Equitable **mortgage of unregistered land not rotected by deposit of the title deeds: protected by registration of a class C(iii) land charge [for legal estates] OR mortgagee giving notice to the trustees [for equitable estate]
Enforcement
- Lender can sue for debt, foreclose on the property, appoint a receiver or take possession of property
- Most common is for lender to sell the land to recover the money owed by the borrower
- If there are multiple mortgages on a property, need to consider the rules on priority:
- Generally, first in time take priority
- Sale by a lender is subject to any prior mortgages but free from any interests over which the mortgage has priority
- If second or subsequent lender decides to sell the property they are obliged to use to proceeds of sale to pay off the original mortgage first
Protection of Easements
Registered land: benefit will appear on dominant tenement as a notice on the property register, burden will appear on servient tenement as a notice on the Charges Register
Unregistered land: if a legal easment then this enforceable against the buyer, if an equitable easement it must be registered as a D(iii) land charge
Right to Redeem
Right of borrower to pay off the mortgage in full and regain all rights over the property
Mortgage agreement will contain the earliest date upon which the loan can be repaid in full
A term postponing the right to redeem will be void if it renders the right to redeem illusory (e.g. postponing the right for 19 years on a 20 year lease)
Priority of Mortgages
LEGAL MORTGAGE OF REGISTERED LEGAL ESTATE
- Has priority over all later mortgages
EQUITABLE MORTGAGE OF REGISTERED LEGAL ESTATE
- If protected by a notice on the register of title then an equitable mortgage will have priority over any leater dealing with legal estate
MORTGAGE OF AN UNREGISTERED LEGAL ESTATE
- If mortgage of legal estate the legal mortgage is protected by deposit of the title deeds and will have priority over all other mortgages
- The priority of all other mortgages depends on the date on which they were registered as a land charge
MORTGAGE OF AN EQUITABLE INTEREST
- E.g benefit of a contract or a BIUT
- Priority of one equitable interest against another equitable interest is that first in time takes priority (irrespective of whether registered or unregistered land)
