Overreaching Flashcards
What is overrreaching
Process whereby certain equitable rights in land that might otherwise have enjoyed protection are swept off the land and transferred to the purchase money that has been paid on occasion of sale.
When that occurs the equitable rights are said to be overreached and no longer bind the purchaser, even though they might have fitted into the category of overriding interests
What rights are capable of being overreached
- Those equitable rights that exist behind a trust of land (equitable ownership rights that exist when the land is co-owned) and which have a readily identifiable monetary value.
- Other’s not as relevant - equity to set aside a transfer as being unconscionable, some proprietary estoppels and
What happens when overreaching occurs
If overreaching occurs, a right that would have been protected against a purchaser ceases to be so protected, irrespective of whether it would have been an overriding interest under LRA 2002.
Conditions of overreaching
Right must be capable of being overreached
Statutory conditions of overreaching must be fulfilled
What rights can be overreached
Overreachable equitable rights are defined in s2 LRA 1925 and in essence are equitable co-ownership rights existing behind a trust in land (Flegg)
Statutory conditions of overreaching
Must be conveyance of a legal estate made by those persons in those circumstances that together constitute overreaching transaction.
‘Conveyance’ either a sale, lease or mortgage of a legal estate that is completed by substantive registration
When does overreaching occur
Transaction is made by at least two trustees exercising valid power under a trust of land, usually in a co-ownership situation. Trustees will be the legal owners of the land. the need for two trustees is a statutory requirement and has no relevance other than this is the minimum number required. Most common transaction effected by the trustees that will overreach any equitable co-owners is simple sale to a purchaser.
