Nature of land

Question 1

What are fixtures and chattels?

Answer 1

Fixtures are included within the definition of land and must be passed to the buyer.

Chattels retain their characteristics as personal property and can be removed on sale.

Question 2

What is the test to determine whether an object is a fixture or a chattel?

Answer 2

1. The degree of annexation - is the object resting on its own weight or is it attached to the land? If attached and removed, would it cause significant damage? If so, it is likely a fixture.
2. The purpose of annexation - is the object attached for better enjoyment of the object, or better enjoyment of the land? If the latter, then it is likely a fixture.

Question 3

What estates are capable of being legal?

Answer 3

Freehold - permanent tenure of the land and freedom to dispose of it.
Leasehold - tenant is granted exclusive possession of land for a fixed period.

Question 4

What are the two types of lease?

Answer 4

Fixed term lease - where the maximum duration is certain

Periodic lease - for a fixed period which extends itself automatically until either the landlord or tenant terminates by notice.

Question 5

What interests in land are capable of being legal?

Answer 5

Easements and profits
Rentcharges
Mortgages
Interests that arise by operation of statute
Rights of entry

Question 6

What interests in land can be equitable?

Answer 6

All property rights are capable of being equitable. Examples include:

• Contract to create or transfer a legal estate or interest
• Failing to comply with the relevant formalities
• Grant where someone only owes the equitable rights
• Grant of an estate which can only exist in equity
• By express or implied trust

Question 7

When land is placed in a trust, how are the types of interest laid out?

Answer 7

The legal title is separated to the equitable interest. The trustee/settlor holds the legal title and the beneficiary has an equitable interest.

Question 8

What types of trusts can exist as equitable interests?

Answer 8

Express
Implied (resulting or constructive)

Question 9

What are resulting trusts in the context of equitable interests?

Answer 9

A person who is not the legal owner who contributes directly to the purchase price - the person obtains an equitable interest proportionate to their contribution.

Question 10

What are constructive trusts in the context of equitable interests?

Answer 10

A person who is not the legal owner makes a contribution to the property by way of mortgage payments or making substantial improvements. It is quantified by taking into account the parties’ conduct, the direct and non-direct financial contributions and any non-financial contributions.

Question 11

What interests are equitable by nature?

Answer 11

Beneficial interests under a trust
Restrictive covenants
Estate contracts

Question 12

What are estate contracts and examples of such?

Answer 12

A contract which exists between the period of exchange of contracts and completion.

Examples - sale of freehold or leasehold, an option, right of pre-emption, grant of a lease and a grant of an easement or profit

Question 13

What is a home right?

Answer 13

A statutory right of occupation of the matrimonial home for a non-owning spouse or civil partner.

They do not create an interest in land and exist independently under a trust.

Question 14

What interests do licences grant?

Answer 14

A licence only grants a personal right and does not create an interest in land - it is binding between the original parties.

They can be revoked at any time.

Question 15

What are the formalities to create or transfer a legal estate or interest?

Answer 15

• Must be in writing
• Must be clear on its face that its a deed
• Signed
• Witnessed
• Delivered

Question 16

What is an exception to the formalities to create or transfer a legal estate or interest?

Answer 16

Parol leases which must be:

• For 3 years or less (including periodic leases)
• The tenant must have the immediate right to possess and enjoy the land
• The tenant must pay market rent
• The landlord must not charge a fine or premium (one-off capital sum)

Question 17

What are the formalities for a contract for the creation or transfer of rights in land?

Answer 17

• Must be in writing
• Must incorporate all expressly agreed terms in one document
• Be signed by or on behalf of all parties

Question 18

How can equitable rights in land be created?

Answer 18

By grant of an estate/interest which can only exist in equity e.g. restrictive covenants

By grant of an estate/interest by a person who only owns an equitable right

By a contract to create or transfer a legal estate or interest

Failure to comply with formalities of a legal estate transfer/creation

By express trust (must be written)

Question 19

When will equity recognise an equitable property right when there has been an invalid deed or a contract for the creation or transfer of rights of land?

Answer 19

It must have:

• A valid contract
• Complying with section 2 LPMPA
• Clean hands

Question 20

How do you create a legal easement?

Answer 20

• Must be in writing
• Must be clear on its face that its a deed
• Signed
• Witnessed
• Delivered
• Must be granted for a period equivalent to a freehold or leasehold i.e. forever or a fixed duration.