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SQE2 > Land & Property Practice > Flashcards

Land & Property Practice Flashcards

1
Q

What Act governs security of tenure in commercial leases?

A

The Landlord and Tenant Act 1954.

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2
Q

What two kinds of lease are excluded from the Landlord & Tenant Act 1954?

A

a) A tenancy at will; and
b) A fixed-term tenancy not exceeding 6 months.

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3
Q

What 3 steps need to be followed in order to contract out of the Landlord & Tenant Act 1954?

A

1) The landlord must serve a health warning on the tenant;
2) The tenant must declare they have received it and are contracting out; and
3) The lease must reference the contracting out.

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4
Q

What must the tenant do if the landlord serves a health warning fewer than 14 days before their tenancy begins?

A

Make a statutory declaration of waiver in front of a solicitor.

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5
Q

When must a Section 25 notice or a Section 26 notice be served in order to be effective?

A

6 - 12 months before the end of the tenancy / new lease.

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6
Q

Who serves a Section 25 notice?

A

The landlord.

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7
Q

Who serves a Section 26 notice?

A

The tenant.

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8
Q

What are the 4 ‘fault’ grounds for a landlord to serve a Section 25 notice on the tenant?

A

1) The tenant has failed to carry out repairing obligations;
2) The tenant continually pays rent late;
3) The tenant has substantially breached other obligations; and
4) There are other suitable alternative premises.

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9
Q

What are the 3 ‘no fault’ grounds for a landlord to serve a Section 25 notice on the tenant?

A

1) The landlord requires the whole property for subsequent letting;
2) The landlord intends to demolish or reconstruct the premises; and
3) The landlord intends to occupy the holding.

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10
Q

In what instances is the tenant entitled to compensation upon being served a Section 25 notice?

A

If the landlord uses any of the 3 ‘no fault’ grounds AND does not offer alternative suitable premises.

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11
Q

How long does the landlord have to respond to a Section 26 notice?

A

2 months.

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12
Q

What must the landlord do when responding to a Section 26 notice?

A

List a statutory ground for refusing the new tenancy.

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13
Q

What is an easement?

A

A right which benefits one piece of land over another piece of land.

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14
Q

What are the 4 requirements for an easement to exist?

A

1) A dominant and servient tenement;
2) A benefit of the dominant land (so not personal);
3) Separate ownership between the land; and
4) Recognised as capable of being an easement.

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15
Q

What are the two requirements to create a legal easement?

A

1) Created by deed; and
2) For the equivalent of a freehold or leasehold term.

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16
Q

What are the 3 ways an easement can be created?

A

1) Express;
2) Implied; and
3) By prescription.

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17
Q

What are the 2 ways in which an easement might be implied?

A

1) Necessity; or
2) Existing use.

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18
Q

What is required for an easement to be created by existing use?

A

a) Continuous and apparent;
b) Necessary for the reasonable enjoyment of the land; and
c) Used by the seller for the benefit of the land now being sold.

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19
Q

What is required for an easement to be created by prescription?

A

a) The right has been used unchallenged for over 20 years; and
b) It has been used ‘as of right’.

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20
Q

Where will the benefit of an easement appear?

A

On the property register of the dominant tenement.

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21
Q

Where will the burden of an easement appear?

A

On the charges register of the servient tenement.

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22
Q

How should an easement be protected for unregistered land?

A

It should be registered as a D(iii) land charge.

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23
Q

What Act governs planning laws in England & Wales?

A

The Town & Country Planning Act 1990.

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24
Q

What are the two forms of planning regulations that must be considered?

A

a) Planning permission; and
b) Building regulations.

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25
Q

What kind of work requires planning permission?

A

Development.

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26
Q

What kind of work is granted deemed permission?

A

Small home extensions within certain size limits or conservatories.

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27
Q

How can a Local Authority remove deemed permission?

A

Through an Article 4 Direction.

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28
Q

What are the two kinds of planning permission?

A

a) Outline; and
b) Detailed.

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29
Q

What does outline planning permission give?

A

Permission as to the principle of the work with reserved matters.

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30
Q

How long do clients have to make an application for detailed permission after receiving outline permission?

A

3 years.

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31
Q

How long do clients who had outline permission have to begin the work after receiving detailed permission?

A

2 years.

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32
Q

How long generally do you have after receiving detailed permission to start building work?

A

3 years.

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33
Q

How long do local authorities have to enforce planning permission breaches relating to construction work?

A

4 years.

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34
Q

How long do local authorities have to enforce planning permission breaches relating to change of use?

A

10 years.

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35
Q

What do listed buildings require if work is to be carried out?

A

Listed building permission.

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36
Q

Where are listed buildings registered?

A

Historic England.

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37
Q

How long is the enforcement period for breaches of listed building permission?

A

Unlimited.

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38
Q

What is issued in the event that a local authority believes someone has breached listed building permission?

A

An enforcement notice.

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39
Q

What are the consequences of failing to comply with an enforcement notice?

A

It is a criminal offence.

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40
Q

Where do sellers inform buyers of any work carried out?

A

The Property Information Form.

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41
Q

Who enforces building regulations?

A

Building Control.

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42
Q

What is issued by the building officer after the work has been completed if it is compliant?

A

A final certificate.

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43
Q

How long does a local authority have to enforce building regulations breaches?

A

12 months, but an injunction can be issued to force the owner to bring it up to standards after that

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44
Q

What could a buyer do in the event that an enforcement period for planning permission has passed?

A

Ask the seller to provide indemnity insurance.

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45
Q

How long does an Energy Performance Certificate last?

A

10 years.

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46
Q

When an EPC not required?

A

When the building is listed.

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47
Q

What 2 steps does an estate agent take at the pre-market stage?

A

1) Negotiate the price; and
2) Send a memorandum of sale to the solicitors.

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48
Q

What Code sets out best practice at the pre-market stage when leasing commercial premises?

A

The Code for Leasing Business Premises.

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49
Q

What does the Code for Leasing Business Premises set out about offers made by landlord to tenants?

A

The offer should be made in writing, include clear terms regarding rent and length, any right to break the lease etc.

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50
Q

What is almost always required if an existing commercial tenant is assigning their lease?

A

Permission of the landlord.

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51
Q

What will the landlord often require when considering if a tenant can assign their lease?

A

3 years of bank references/business accounts and a reference from the assignee’s landlord.

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52
Q

Who drafts a license to assign?

A

The landlord’s solicitor.

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53
Q

What will a landlord often require as a condition of assigning a lease?

A

An Authorised Guarantee Agreement.

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54
Q

How long does the pre-contract stage typically take?

A

4 - 6 weeks.

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55
Q

How does the seller’s solicitor deduce title at the pre-contract stage for registered land?

A

By obtaining the Official Copies from the HMLR portal.

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56
Q

How does the seller’s solicitor deduce title at the pre-contract stage for unregistered land?

A

By obtaining the root/epitome of title.

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57
Q

What will the seller’s solicitor have to do at the pre-contract stage if unregistered property deeds have been given to a lender as security for a mortgage?

A

Give an undertaking to retain the deeds pending the redemption of the mortgage.

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58
Q

When does the Law Society’s Conveyance Protocol require that the seller’s solicitor remedy any defects in the seller’s title?

A

At the pre-contract stage.

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59
Q

What 4 things does the contract package sent to the buyer’s solicitor contain?

A

a) The draft contract in duplicate;
b) The PIF and Fittings & Contents form;
c) A copy of the seller’s title or epitome of title; and
d) Any guarantees or planning permissions.

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60
Q

What kind of defects must be disclosed at the pre-contract stage?

A

Latent defects & burdens.

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61
Q

What is a latent defect?

A

One that would not be apparent from a reasonable inspection of the land.

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62
Q

What can the buyer do if the seller attempts to cover up a patent defect?

A

Sue the seller in tort for willful deceit.

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63
Q

What are the three main searches carried out by the buyer’s solicitor at the pre-contract stage?

A

1) Local searches;
2) Drainage and water search; and
3) Environmental search

64
Q

What is included under the umbrella of local searches?

A

1) Local land charges;
2) Planning charges;
3) Listed building charges; and
4) Enquiries of local authorities.

65
Q

When is a search of the Index Map required?

A

When the property is unregistered to check if it is registered.

66
Q

When will a bankruptcy search be carried out by the buyer’s solicitor at pre-contract stage?

A

When the buyer is obtaining a mortgage.

67
Q

When will a company search be carried out by the buyer’s solicitor at pre-contract stage?

A

When the seller is a company.

68
Q

What will the buyer’s solicitor do if they discover any title defects or issues at pre-contract stage?

A

They will raise enquiries of the seller’s solicitor.

69
Q

At the pre-contract stage of a leasehold transaction, what must the landlord do to enable the tenant to register the lease with title absolute?

A

They must deduce title.

70
Q

At the pre-contract stage of a leasehold transaction, what two things must the seller do if they are assigning the lease and consent is required?

A

1) Apply for consent at their cost; and
2) Use all reasonable endeavors to obtain it.

71
Q

At the pre-contract stage of a leasehold transaction, what can the seller do if the seller has not gained permission to assign their lease?

A

If it is 3 working days before completion, the seller can rescind.

72
Q

Who drafts the transfer form?

A

The buyer’s solicitor.

73
Q

When does the buyer need to sign the transfer form?

A

If there are any declarations of trust (i.e. more than one buyer) or covenants.

74
Q

What 2 things does the seller prepare before completion?

A

1) The Completion Information and Undertakings Form for the buyer; and
2) A completion statement for the seller.

75
Q

If the buyer is using a mortgage, what does the buyer’s solicitor submit to the lender before completion?

A

The Certificate of Title.

76
Q

What two functions does the Certificate of Title serve?

A

1) To confirm the property is good and marketable; and
2) To act as a drawdown request for the lender.

77
Q

What search does the buyer’s solicitor always carry out at pre-completion stage?

A

An OS1 or OS2 search.

78
Q

What search does the buyer’s solicitor carry out at pre-completion stage if the buyer is using a mortgage?

A

A bankruptcy search on behalf of the lender.

79
Q

How long is the OS1’s priority period for the buyer to register the disposition?

A

30 working days.

80
Q

What does the seller’s solicitor do after completion?

A

Redeem any mortgages and request a release from their undertaking to do so.

81
Q

What two things does the buyer’s solicitor do after completion?

A

1) Prepare the SDLT form and pay any due; and
2) Submit the application to register the transfer at the Land Registry within the priority period.

82
Q

What does a prospective tenant need to do if they are unhappy with the terms of the lease?

A

Ask the seller to negotiate with the landlord to get a deed of variation.

83
Q

What are ‘prescribed clauses’ in the context of a lease?

A

A summary of the lease terms that must be included in any lease that is registrable to help HMLR complete registration quickly.

84
Q

What length of lease term is generally not acceptable to a lender?

A

Less than 80 years.

85
Q

What clause is generally included in a commercial lease that is not included in a residential one?

A

A rent review clause.

86
Q

What should a solicitor do if the buyer refuses to disclose a material change in circumstances to the lender?

A

Stop acting for the client.

87
Q

What two things should a solicitor ensure clients do if they are buying property as tenants in common?

A

1) Enter into a declaration of trust; and
2) Have wills drafted to dictate what they want done with their shares.

88
Q

What can parties do from 2pm on the day of completion if it is delayed?

A

Claim interest at the contract rate.

89
Q

How can an innocent party make time of the essence when completion is delayed?

A

By serving a notice to complete.

90
Q

How long does the breaching party have to complete after being served a notice to complete?

A

10 working days.

91
Q

What is the innocent party stating when they serve a notice to complete?

A

That they are ready, willing and able to complete.

92
Q

What two things can the buyer do if the seller does not complete after being served with a notice to complete?

A

1) Claim their deposit back with interest; and
2) Claim for damages.

93
Q

What two things can the seller do if the buyer does not complete after being served with a notice to complete?

A

1) Keep the deposit; and
2) Sell the house and claim damages for any loss in house price.

94
Q

What must you make sure happens if there is a non-owning occupier in the property?

A

Have the non-owning occupier sign the contract to agree to move out after completion.

95
Q

What remedies can the buyer claim between exchange and completion?

A

Specific performance, damages or rescission.

96
Q

When can a contract be rescinded under the Standard Conditions of Sale?

A

1) There is an element of fraud or recklessness; or
2) If the innocent party took the property, it would be substantially different from the property they expected to take.

97
Q

What is a misrepresentation?

A

A statement of fact made by one party that induced the other party into entering a contract.

98
Q

What are the 3 kinds of misrepresentation?

A

a) Fraudulent;
b) Negligent; and
c) Innocent.

99
Q

What can a buyer do if there has been a misdescription?

A

Rescind the contract and claim damages.

100
Q

Why are fewer remedies available after having completed?

A

Because the terms of the contract merge with the purchase deed.

101
Q

What does Commercial Rent Arrears Recovery allow a commercial landlord to do?

A

Enter the property and take the tenant’s goods to sell them after having given notice 7 days prior.

102
Q

How can the right to forfeiture enter a lease?

A

ONLY by express incorporation.

103
Q

What can a tenant do if the landlord exercises their right to forfeiture?

A

Apply for statutory relief.

104
Q

How can a landlord waive their right to forfeiture?

A

By accepting the breach.

105
Q

Who can be pursued for a breach of covenant in leases made before 1996?

A

The original tenant is always liable. There is usually a chain of indemnity.

106
Q

Who can be pursued for a breach of covenant in leases made after 1996?

A

Under the Landlord and Tenant (Covenants) Act 1995, tenants are automatically released on assignment.

107
Q

Which three of the Section 25 grounds are “mandatory” grounds?

A

a) The availability of alternative suitable premises;
b) The landlord intends to destruct or demolish the premises; and
c) The landlord intends to occupy the premises.

108
Q

Which four of the Section 25 grounds are “discretionary” grounds?

A

a) The tenant has consistently been late in paying rent;
b) The tenant has breached their repair covenant obligations;
c) The tenant has substantially breached other covenants; and
d) The landlord wants to rent out the whole premises (if only part has been let).

109
Q

How is SDLT calculated?

A

It is a tiered tax.

110
Q

How much extra SDLT is charged for second properties?

A

3% on each band.

111
Q

How is SDLT calculated on a lease?

A

a) Any lease premium paid; and/or
b) The net present value of the rent.

112
Q

What are the relief rates for the purchase of first residence relief?

A

0% up to £300,000 then 5% on any remainder. After £500,000, no relief is given.

113
Q

When does a trust of land arise automatically?

A

When land is owned by more than one person.

114
Q

How must co-owners hold the legal estate in land?

A

As joint tenants.

115
Q

What happens when a joint tenant dies?

A

Their share of the land passes automatically to the surviving tenant by survivorship.

116
Q

In what 3 scenarios would a tenancy in common be appropriate?

A

a) Where it’s clear that the parties did not intend to hold as joint tenants;
b) Where they contributed in equal portions to the purchase price; and
c) Where they entered into a commercial transaction where a joint tenancy would be inappropriate.

117
Q

What are the 5 major ways in which a joint tenancy can be severed?

A

a) Written notice;
b) Treating share as separate;
c) Disposal of the equitable interest;
d) Mutual agreement; and
e) Course of dealings.

118
Q

What is the presumption regarding equitable ownership of land?

A

That equity follows the law.

119
Q

How does a buyer take land free of beneficial interest if there are multiple owners?

A

By overreaching.

120
Q

How can a buyer overreach any beneficial interest?

A

Pay the purchase price to at least two beneficial owners.

121
Q

What should the buyer do if there is only one owner but there remains a Form A restriction on the proprietorship register?

A

Ensure a second trustee is appointed to overreach any beneficial interest.

122
Q

What does section 14 of TLATA 1996 allow trustees to do?

A

Apply to the court for an order for sale or relieving requirement for consent.

123
Q

What factors are set out by section 15 of TLATA which determine what they must consider when deciding a section 14 application?

A

a) The intentions of the person who created the trust;
b) The purposes for which the property is held;
c) The welfare of any minor who occupies; and
d) The interests of any secured creditor.

124
Q

What will happen in the event that owners disagree but there is a declaration of trust?

A

The declaration of trust is usually conclusive.

125
Q

If a property was transferred to owners jointly, how can a challenger challenge the presumption of a joint tenancy?

A

By proving there was a different common intention.

126
Q

What will the court consider when an applicant challenges ownership of property via common intention?

A

All the circumstances.

127
Q

When is CGT due?

A

31 January of the following tax year.

128
Q

How do you declare any CGT due?

A

Annual self-assessment tax return.

129
Q

How do you calculate a gain?

A

Proceeds of sale - costs of acquisition

130
Q

What two costs are deductible from the proceeds of sale as well as costs of acquisition?

A

a) Costs of enhancements made; and
b) Costs of defending title.

131
Q

What relief allows a full or partial exemption of a gain in property?

A

Private Residence Relief

132
Q

What are the 4 different deemed occupations and their periods?

A

a) Last nine months of ownership;
b) Any period of absence up to 3 years;
c) Abroad for employment - unlimited; and
d) Absent from property due to working elsewhere for up to 4 years.

133
Q

How much is the annual exempt amount for CGT?

A

£12,300.

134
Q

What is a landlord required to serve on a tenant before exercising a forfeiture right after a tenant has failed to carry out their repair obligations?

A

A section 146 notice.

135
Q

What three things must a section 146 notice include?

A

a) Specify the breach;
b) Require the breach to be remedied in a reasonable time; and
c) Require the tenant to pay compensation if required.

136
Q

Who can always enforce covenants against each other?

A

The original parties.

137
Q

What are the 4 requirements for a successor in title to enforce the benefit of a restrictive covenant?

A

a) The covenant touches and concerns the land;
b) The covenant was intended to run;
c) The covenantee held the legal estate when the covenant was made; and
d) The assignee of the covenantee now holds the legal estate.

138
Q

What are the 4 requirements for a successor in title to enforce the burden of a restrictive covenant in equity?

A

a) The covenant is negative;
b) The covenantee owned the benefitted land when covenant was made;
c) The burden was intended to run; and
d) General equitable principles apply (registration required).

139
Q

Can positive covenants run with the land?

A

No.

140
Q

What are the 5 methods of granting an enforceable positive covenant?

A

a) Granting a lease;
b) Setting up a commonhold scheme;
c) Chain of indemnity covenants;
d) Right of re-entry coupled with rentcharge; and
e) The benefit and burden rule.

141
Q

What does protection of a third-party interest count by registration do?

A

Counts as notice for prospective buyers.

142
Q

How should a solicitor search for any registered third party interests protected by registration in unregistered land?

A

By searching the correct full name of the current proprietor(s).

143
Q

What happens to an interest in unregistered land if it is not protected by registration when the land is sold?

A

The land charge is void against purchasers of the legal estate for money or money’s worth.

144
Q

When is a buyer bound by an equitable interest in unregistered land?

A

If they have notice of it.

145
Q

When will a buyer not be bound by an equitable interest in unregistered land?

A

If they are a bona fide purchaser for value of the legal estate without notice.

146
Q

What 4 interests in unregistered land override first registration?

A

a) A lease of more than 7 years;
b) A legal easement;
c) A local land charge; and
d) An interest of someone in actual occupation.

147
Q

How long must a squatter hold unregistered land to claim the title by adverse possession?

A

12 years.

148
Q

What 3 things must an applicant for adverse possession of unregistered land show?

A

a) They have actual possession;
b) It is exclusive; and
c) It is without permission.

149
Q

How soon should land be registered after a triggering event?

A

2 months.

150
Q

What happens if a buyer fails to register land after a triggering event?

A

It reverts to the original owner.

151
Q

What is absolute freehold title?

A

The Registered Proprietor takes the legal estate together with all interests benefitting that estate.

152
Q

What is possessory title?

A

Title based on factual possession of the land e.g. adverse possession or title deeds lost.

153
Q

What is good leasehold title?

A

The freehold title hasn’t been produced therefore the titleholder is subject to any previous leases.

154
Q

What third-party interests in registered land are not complete until registration?

A

a) Dispositions of legal estate;
b) Mortgages;
c) Easements;
d) Leases of 7 years or longer; and
e) Certain other leases.

155
Q

What restriction is standard when property is held as tenants in common?

A

A Form A restriction.

156
Q

What 2 ways can a buyer avoid an overriding interest from someone in actual occupation?

A

a) Enquiry of the seller and failure to disclose; or
b) Occupation was not obvious on reasonable inspection of the land and the buyer did not know.

SQE2 (8 decks)

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