SBAQ LAND Flashcards

Question 1

Q

What is the focus of the study of Land law?

The Crown’s ownership of land

The physical land

The history of land ownership

Rights in the land

The sale of property

Answer

A

Rights in the land
Correct. Land law is all about rights in the land, rather than the physical land itself. These rights can be very powerful. Land law is also the study of different land-related relationships, such as landlord and tenant.

Question 2

Q

A person describes themselves as the owner of a piece of land, which includes a house and garden. What do they own?

The physical land

A right to possess the land

The physical building on the land only

Answer

A

A right to possess the land
Correct. We are completely wrong in everyday language when we refer to ourselves as owning a piece of land. The Crown owns all land in England and Wales. What we technically own is a right to possess the land.

Question 3

Q

Which of the following pieces of statute is the foundation of modern land law?

The Law of Property Act 1066

The Land Registration Act 2002

The Law of Property Act 1925

The Law of Property Act 2002

Answer

A

The Law of Property Act 1925

Land law was radically overhauled by a statute called the Law of Property Act 1925 (LPA). This is the reason that the majority of land law has its roots in statute, rather than case law, and the LPA 1925 is the real foundation of modern land law.

Question 4

Q

Which of the following options correctly describes the process you must go through to determine if a right being claimed is proprietary or not?

Examine whether the right in question relate to personal or real property

Conduct a physical inspection of the land to ascertain whether there is evidence of the right in question

Determine whether the right in question has been registered

Determine if the right is on the list of recognised proprietary rights, whether it satisfies the substantive characteristics, and has been created/acquired in accordance with the formalities for the right

Answer

A

Determine if the right is on the list of recognised proprietary rights, whether it satisfies the substantive characteristics, and has been created/acquired in accordance with the formalities for the right

Proprietary rights are very powerful. As a result, these requirements will have to be met for a right to have proprietary status in the circumstances.

Question 5

Q

Which of the following statements best explains what it means if someone holds a proprietary right in the land?

The right is enforceable in personam

The right is in personal property

Compensation is available for breach of a proprietary right

The right is capable of being enforced against third parties

The right will automatically be enforceable against a new owner of the land

Answer

A

The right is capable of being enforced against third parties

A proprietary right is capable of being enforced against third parties. It will not just be enforceable against the grantor of the right. A proprietary right is not, however, automatically enforceable against a third party.

Question 6

Q

A landowner grants their friend a right to live in the landowner’s house for 5 years. One year later the landowner decides they would like the house back. The landowner goes into the house and changes the locks. Which of the following statements correctly explains what it means if the right to live in the house is determined to be a proprietary right known as a lease?

The friend would be able to recover the right to live in the house for the remainder of the term

The Crown owns the land and would be able to evict the both the landowner and the friend if it would like to

The friend would not be able to do anything as the landowner owns the land

If the landowner sold the house then the friend would not be able to enforce the right to live in the house against the new owner

The friend would have to settle for damages for breach of the right

Answer

A

The friend would be able to recover the right to live in the house for the remainder of the term
A lease is a proprietary right which is enforceable in rem ie the right is in the land rather than against the landowner who granted the right. This means if the right is a lease then the friend would be entitled to recover possession and use of the house for the remainder of the lease term.

Question 7

Q

Two landowners are neighbours. One of the landowners grants the other a right to store coal in their coal shed. The grantor of the right sells their house. The new owner asks the neighbour to move the coal from the shed. Which of the following statements best describes the legal position?

The neighbour does not need to move the coal if the right is an easement and if it has been registered properly at the Land Registry

The neighbour does not need to move the coal because it is real property

The neighbour will have to move the coal because it is personal property.

The neighbour does not need to move the coal because they have a proprietary right in the land.

The neighbour will have to move the coal because such a right can never be enforced against a third party

Answer

A

The neighbour does not need to move the coal if the right is an easement and if it has been registered properly at the Land Registry

The neighbour does not need to move the coal if the right to store is an easement, provided it has been registered at the Land Registry. A right to store is capable of being an easement. Provided that it satisfies the substantive requirements of easements and has been created in accordance with the correct formalities then it will be an easement. If the easement is registered it would then be binding the new landowner.

Question 8

Q

What is the technical name for a freehold estate?

Term of years absolute

Fee simple years absolute

Term of years in possession

Fee simple absolute in possession

Answer

A

Fee simple absolute in possession

This is how the freehold is defined in LPA 1925, s 1(1)(a). However, in practice it is always referred to as the freehold.

Question 9

Q

Does the freeholder need to be physically in possession of a piece of land?

Yes, all of the land

Yes, at least part of the land

No

Answer

A

No

Physical possession is not necessary as ‘in possession’ includes receiving rent.

Question 10

Q

The particulars of sale for a third floor, two-bedroomed flat in Camden state that the price is £400,000 and there are 125 years left to run on the term. If you bought this flat, what would you be buying?

A personal right in the land

The physical land

A freehold estate

The fee simple

A leasehold estate

Answer

A

A leasehold estate

Though you may think you will be the owner of the flat, what you would actually be the owner of is a 125 year lease of the flat. If you bought this flat, you would have a proprietary right to possess the land for 125 years.

Question 11

Q

Which of the following correctly describes an estate in land?

A right to use or enjoy the land

A right to possess the land

Physical ownership of the land

Answer

A

A right to possess the land

We cannot own the physical land, we can just own a right to possess the land. This is known as an estate.

Question 12

Q

Which of the 3 stages of transferring a freehold estate is not necessary to effect a legal transfer of the title?

All stages are necessary

Contract

Registration

Deed

Answer

A

Contract

A contract is not required to legally transfer the land. However, it is usual for the parties to enter into a contract as part of the conveyancing process.

Question 13

Q

Which of the following options is the correct statutory authority for the rule that a deed must be used to transfer a freehold estate?

LPA 1925, s 52

LP(MP)A 1989, s 1

LRA 2002, s 27

LP(MP)A 1989, s 2

Answer

A

LPA 1925, s 52

A legal estate must be transferred or created by deed. LPA, s 52 relates to the transfer of a freehold estate. It also relates to the creation of a leasehold estate and a legal mortgage and a legal easement as you will learn about.

Question 14

Q

If a piece of registered land is transferred, at what point is the buyer recognised as being the legal owner of the land?

Registration

When the land is registered for the first time

Exchange of contracts

When the purchase money is paid

Completion of the transfer deed

Answer

A

Registration

Legal title (ie ownership) transfers at the point at which the buyer is registered at the Land Registry.

Question 15

Q

If the land being transferred is unregistered land, does the transfer need to be registered?

Yes the land transfer will trigger the requirement to register the land for the first time

No there is never a requirement to register a land transfer

No because the legal title transfers at the point at which the deed is completed

Yes the registered title will need to be updated

Answer

A

Yes the land transfer will trigger the requirement to register the land for the first time

The land transfer will trigger a requirement to trigger the land for the first time. This is called compulsory land registration.

Question 16

Q

A buyer and seller enter into a document that is described as a ‘transfer deed’ for the sale of a piece of land. The seller signs the deed in the presence of their solicitor, who attests their signature. The buyer transfers the purchase money and the seller’s solicitor then dates the document. Which of the following statements correctly explains whether the deed is valid?

The deed is invalid because it has not been delivered

The deed is valid because it complies with LP(MP)A 1989, s 1

The deed is valid because it complies with LPA 1925, s 52

The deed is invalid because it has not been signed by both the buyer and the seller

The deed is invalid because it has not been correctly executed by the seller

Answer

A

The deed is valid because it complies with LP(MP)A 1989, s 1

The deed is valid. It has been clearly intended as a deed by being described as such, it has been correctly executed – signed by the seller in the presence of a witness who also signs and it has been delivered, which was done by dating the document. It therefore complies with a requirements laid down in LP (MP) A 1989, s.1, which is the statutory authority which tells us the requirements of a deed.

Question 17

Q

A buyer and seller of land agree that the buyer will buy a piece of land from the seller for a price of £100,000. They instruct solicitors. The buyer’s solicitor carries out various investigations into the land before the buyer confirms it is happy to proceed. The terms of the agreement are put into a document, which is signed by the buyer and the seller.

Which of the following statement correctly explains the validity of this document?

The document is valid because it complies with LP(MP)A 1989, s 1

The document is valid because it satisfies the requirements in LRA 2002, s 27

The document is invalid because it has not been delivered

The document is valid because it complies with LP(MP)A 1989, s 2

The document is invalid because it has not been witnessed

Answer

A

The document is valid because it complies with LP(MP)A 1989, s 2

The buyer and seller have not entered into a contract to buy/sell the land. The contract is valid because it is in writing, contains all the agreed terms and has been signed by both the buyer and seller. It complies with LP(MP)A 1989, s 2, which is the correct statutory authority.

Question 18

Q

A buyer and seller of land agree that the buyer will buy a piece of land from the seller for a price of £100,000. They instruct solicitors. The buyer’s solicitor carries out various investigations into the land before the buyer confirms it is happy to proceed. The terms of the agreement are put into a document, which is signed the seller in the presence of a witness. The document is then dated.

Which of the following statement correctly explains the validity of this document?

The document is invalid because it has not been delivered

The document is valid because it complies with LP(MP)A 1989, s 2

The document is valid because it complies with LP(MP)A 1989, s 1

The document is invalid because the witnessed has not attested his signature

The document is invalid because it has not been signed by both the buyer and the seller

Answer

A

The document is invalid because it has not been signed by both the buyer and the seller

The buyer and seller have entered into a contract to buy/sell the land. The contract is not valid it has not been signed by both the buyer and seller. It does not comply with LP(MP)A 1989, s.2. There is no requirement that either signature be witnessed.

Question 19

Q

If a piece of unregistered land is transferred, at what point is the buyer recognised as being the legal owner of the land?

Exchange of contracts

When the purchase money is paid

Completion of the transfer deed

When the land is registered for the first time

Registration

Answer

A

Completion of the transfer deed

Question 20

Q

Which of the following options best explains why approximately 15% of land in England and Wales remains unregistered?

The land is subject to an overriding interest

You only have to register a piece of land if a triggering event occurs eg sale of the freehold estate

The land will be in an area which is not designated as being subject to compulsory registration

The landowner has chosen not to register the land

Answer

A

You only have to register a piece of land if a triggering event occurs eg sale of the freehold estate

From 1926 onwards central government designated various areas as being areas of compulsory registration, so eventually all of England and Wales would be registered. It was not until 1990 that all of England and Wales became designated as an area subject to compulsory registration. The effect of designating an area as being subject to compulsory registration is that if there is then a transaction or event (disposition) with the land which triggers compulsory registration (a triggering event) then the land must be registered for the first time. If there has not be a triggering event with a piece of land it will remain unregistered unless the land owner chooses to make a voluntary first registration application.

Question 21

Q

Which of the following options best explains the advantages of the system of Land Registration?

There are no overriding interests which could bind the land

Dealing with registered land is very repetitive and so speeds up the process of conveyancing

The process of conveyancing is quicker, simpler and ownership is guaranteed by the state

Approximately 75% of land in England and Wales is now registered so solicitors will be more familiar with the registered land system

The Land Registry offer reduced fees if that land is registered

Answer

A

The process of conveyancing is quicker, simpler and ownership is guaranteed by the state

A buyer of registered land does not need to investigate numerous title deeds to establish ownership and the rights a piece of land has the benefit/burden of. As a result, it is quicker and simpler to investigate a piece of registered land and speeds up the process of conveyancing. Also, ownership of a registered pieces of land is guaranteed by the state, so there is a mistake with the register then the innocent party who has suffered loss can make a claim for compensation against the Land Registry.

Question 22

Q

Which of the following options is the correct statutory authority for the requirement to register a piece of land for the first time following the grant of a legal mortgage over the unregistered freehold estate?

LRA 2002, s 27

LRA 2002, sch 2

LPA 1925, s 27

LPA 1925, s 4

LRA 2002, s 4

Answer

A

LRA 2002, s 4

LRA 2002, s 4 lists the transactions over unregistered land that trigger a requirement to register the land for the first time. The grant of a legal mortgage over a piece of unregistered land will trigger a requirement to register the land for the first time.

Question 23

Q

Which of the following options correctly lists the dispositions (ie transactions) that trigger a requirement to register the land for the first time?

The grant of a 3 year lease, the sale of a freehold and the grant of an equitable mortgage

The grant of a 1 year lease, the assent of a freehold and the grant of an equitable mortgage

The grant of a 9 year lease, the gifting of a freehold and the grant of a legal mortgage

The grant of a 6 year lease, the sale of a freehold and the grant of a legal mortgage

The grants of a 7 years lease, the sale of a freehold and the grant of a legal mortgage

Answer

A

The grant of a 9 year lease, the gifting of a freehold and the grant of a legal mortgage

Under LRA 2002, s 4 (first registration) and LRA 2002, s 27 (transactions involving already registered land) the circumstances which trigger compulsory registration now include all of these transactions. It is not necessary for there to be a sale of a freehold estate, the gift or assent of a freehold estate will also trigger a registration requirement. The grant of a lease over 7 years must be completed by registration, as must the grant of a legal mortgage.

Question 24

Q

Which system for proving ownership of land is governed by the LRA 2002?

Registered Land

Unregistered Land

The Land Registry

Answer

A

Registered Land

The LRA 2002 governs the registered land system. The system was introduced by the Land Registration Act 1925, but this has not been repealed and replaced in its entirety by the LRA 2002.

Question 25

Q

Overriding interests are a feature of which system for proving ownership of land?

The Land Registry

Unregistered Land

Registered Land

Answer

A

Registered Land

Overriding interests are one of the greatest criticisms of the registered land system as they are interests which do not need to be registered, but will still be binding on a third party purchaser of the burdened land. They arguably defeat the rational for Land Registration however, there are valid justifications for their existence.

Question 26

Q

Which register in an official copy contains the details of any leases that burden a piece of land?

Charges Register

Property Register

Proprietorship Register

Answer

A

Charges Register

This register contains details of any rights that burden a piece of land eg leases, mortgages, restrictive covenants, easements.

Question 27

Q

Which register in an official copy contains the description of the piece of land that is registered?

Proprietorship Register

Charges Register

Property Register

Answer

A

Property Register

This register contains a description of the piece of land and the details of any rights that benefit a piece of land.

Question 28

Q

Which class of title would you to expect to see if the Land Registry is satisfied as to the ownership of the estate and that there is no defect with the title?

Possessory Title

Absolute Title

Good Leasehold

Qualified Title

Answer

A

Absolute Title

This is the best form of ownership and is really what you would want to see on the official copies if you were buying a property. Most properties are registered with this class of title and it means the Land Registry does not consider there are any defects with the ownership. The land is only bound by interests that are registered on the title or overriding interests.

Question 29

Q

Which of the following options best explains why the mirror principle of Land Registration has never fully been realised?

Around 15% of land in England and Wales remains unregistered

If someone is in possession of a piece of land but has lost the title deeds, they cannot be registered as the legal owner

A buyer of land will have to investigate the equitable ownership of a piece of land in addition to the legal ownership

Certain interests do not need to be registered, but will still be binding on a third party

Answer

A

Certain interests do not need to be registered, but will still be binding on a third party

The mirror principle is the ideal that the register should reflect all matters that the property has the benefit of and all the matters that the property is subject to. It should be a clear and comprehensive account of the ownership and rights that benefit and burden a piece of land. However, this has arguably never fully been realised due to the existence of ‘overriding interests’, which are interests that do not need registering and so do not appear on the register, but will still be binding.

Question 30

Q

Which of the following statements correctly describes the curtain principle of Land Registration?

The accuracy of the register is guaranteed by the state

The register should reflect all matters that the property has the benefit of and all the matters that the property is subject to

Certain interests do not need to be registered, but will still be binding on a third party

A buyer of land will have to investigate the equitable ownership of a piece of land in addition to the legal ownership

A buyer of land need not be concerned with the equitable ownership of an estate

Answer

A

A buyer of land need not be concerned with the equitable ownership of an estate

The register records the ownership of the legal estate in the property, the legal title. A buyer need not be concerned with the equitable ownership. As these matters are kept off the register we call this ‘behind the curtain’.

Question 31

Q

Which register in an official copy contains details as to who owns a piece of land?

Charges Register

Property Register

Proprietorship Register

Answer

A

This register contains details of the owner of the legal estate. This person(s) is called the ‘registered proprietor’. Proprietor is another word for owner.

Question 32

Q

Which of the following confers a personal permission to be on the land?

Licence

Lease

Both a lease and a licence

Neither a lease or a licence

Answer

A

Licence

A licence is a personal permission, a form of contract.

Question 33

Q

Two parties enter in a document, which they label as a ‘Licence to Occupy’. The term of the licence for ‘as long as the occupier is a student at university’. The right is granted by deed. Which of the following statements correctly explains whether a lease or licence has been granted on the facts?

The document is a licence because there is no certain term

The document is a licence because the correct formalities have not been complied with

The document is a licence because it has been labelled as such

The document is a lease because it has been granted by deed

The document is a lease because the document confers a right to possess the land

Answer

A

The document is a licence because there is no certain term

The document is a licence because the term is uncertain, and we do not know when it will end. There is no certain term. The fact that the document is labelled as a licence is inconclusive and will not be a determining feature. The courts would look at the substance of the document, rather than the label it is given.

Question 34

Q

Last year two parties entered into a lease for five years of an office space. The lease provides that the rent is ‘a peppercorn’ (ie nothing). The lease confers exclusive possession onto the occupier and complies with the correct formalities. Last month the landlord sold the freehold reversion to a third party. Yesterday, the new owner changed the locks and refused to let the occupier in. Which of the following statements correctly explains whether the occupier will be able to recover possession of the office space?

The occupier will be able to recover possession of the office space because it has a proprietary right in the land under the lease

The occupier will not be able to recover possession of the office space because it only has a personal right in the land

The occupier will be able to recover possession of the office space because the document is labelled as a lease and will therefore bind third parties

The occupier will not be able to recover possession of the office space because it is not paying rent, so the document is a licence

The occupier will not be able to recover possession of the office space because there is no certain term, so the document is a licence

Answer

A

The occupier will be able to recover possession of the office space because it has a proprietary right in the land under the lease

The occupier is a tenant. There is a certain term, the occupier has exclusive possession and the correct formalities have been complied with. It does not matter that the rent is ‘a peppercorn’ as a rent does not need to be payable for there to be a lease. As the occupier has a lease, it has a proprietary right in the land, the defining feature of which is that it is capable of being enforced against third parties i.e. the new freehold owner. For this reason, the tenant will be able to recover possession of the office space, it will not have to settle for damages.

Question 35

Q

Last year two parties entered into a Licence to Occupy for 2 years of an office space. The licence provides that the rent is £10,000 per annum and that the licensor can share occupation with the licensee, which it does. The licence complies with the correct formalities. Yesterday, the new owner changed the locks and refused to let the occupier in. Which of the following statements correctly explains whether the occupier has a lease or a licence?

The occupier has a licence because the document is labelled as a licence

The occupier has a lease because the correct formalities have been met

The occupier has a licence because there is no certain term

The occupier has a lease because it is paying rent

The occupier has a licence because there is no exclusive possession

Answer

A

The occupier has a licence because there is no exclusive possession

The occupier is a licensee only. There is a certain term, but the occupier does not have exclusive possession as it shares possession with the licensor – it cannot exclude the licensor from the premises. It makes no difference that the correct formalities have been complied with, the requirements of a lease have not been met.

Question 36

Q

A lease granted for 1000 years can never be a lease and fails for lack of a certain term. Is this statement true or false?

False

True

Answer

A

False
A certain term means you know the duration of the lease and when it will end. This is often evidenced by a fixed term. A fixed term can be as little as a day or as 1000 years, it is still certain and we know when it will end.

Question 37

Q

In order for there to be lease a rent must be payable. Is this true or false?

False

True

Answer

A

False

This is correct. Although Lord Templeman indicated that payment of rent is essential in Street v Mountford [1985] AC 809, LPA 1925, s 205(1)(xxvii) makes it clear that rent is not essential. This was confirmed in the case of Ashburn Anstalt v Arnold [1989] Ch 1

Question 38

Q

Two parties enter into a document which is described as a lease of a flat with a rent payable of £12,000 per annum payable by equal monthly payments. What kind of lease does the tenant have?

An implied periodic tenancy of one year

An express periodic tenancy of one month

An express periodic tenancy of one year

A fixed term lease of one year

An implied periodic tenancy of one month

Answer

A

An express periodic tenancy of one year

The lease does not have a fixed term, it has a periodic term, which is determined by reference to have rent is calculated, which is ‘per annum’ on the facts i.e. yearly. It does not matter that it is payable monthly. The lease is written down, it is express on our facts.

Question 39

Q

Two parties enter into a document which grants a right to possess for 5000 years with a rent of £100 per annum payable each year. Which of the following statements best explains the nature of the document?

The document is a lease because there is an express periodic term

The document is a licence because the term is uncertain

The document is not a lease but there is an implied periodic tenancy on the facts

The document is a lease because there is a fixed term

Answer

A

The document is a lease because there is a fixed term

Although 5000 years is a very long time, the term is certain. We know when the lease will end. This is a fixed term.

Question 40

Q

Two parties enter into a document which is described as a lease of a house with a rent payable of £1,000 per month payable by monthly payments. The term is described as being for two years. What kind of lease does the tenant have?

An implied periodic tenancy of one month

A fixed term lease of one month

A fixed term lease of two years

An implied periodic tenancy of two years

An express periodic tenancy of one month

Answer

A

A fixed term lease of two years

Question 41

Q

Two parties enter into a document which is described as a lease of a house with a rent payable of £1,000 per month payable by monthly payments. The term is described as being for two years. What kind of lease does the tenant have?

An implied periodic tenancy of one month

A fixed term lease of one month

A fixed term lease of two years

An implied periodic tenancy of two years

An express periodic tenancy of one month

Answer

A

A fixed term lease of two years

Question 42

Q

In considering whether a clause in a lease is a sham clause, not reflecting reality and therefore not defeating a tenant from having exclusive possession, which of the following circumstances would likely indicate such a clause is a sham?

A widely-drafted sharing clause that has been exercised by the landlord on several occasions

A landlord retaining a key to access the premises in case of an emergency

A two-bedroomed flat where one room is vacant and the landlord has a right to introduce one other into the premises

A couple sharing a one-bedroomed flat and the landlord has a right to introduce others to share occupation

Answer

A

A couple sharing a one-bedroomed flat and the landlord has a right to introduce others to share occupation

The courts will look at the reality of a situation, looking beyond the label. In doing this, the court would consider a number of factors, as laid down in A G Securities v Vaughan and Antoniades v Villiers both reported at [1990] 1 AC 417t. This includes the relationship between the occupiers and whether it would be appropriate to introduce another to share given the relationship. It would be an unlikely situation to introduce someone into a one bedroomed flat which is being occupied by a couple on the facts and this would indicate the clause could be a sham.

Question 43

Q

An individual occupies a flat under a Licence agreement. The agreement reserves a right of entry to the licensor in the event of an emergency. The licensor retains a key for this purpose. The clause has never been exercised. Which of the following statements correctly describes whether the individual has exclusive possession?

There is no exclusive possession as the licensor is providing services

There could be exclusive possession if the clause is a sham

There could be exclusive possession as access is restricted

There is no exclusive possession because the individual cannot exclude the landlord from the flat in the event of an emergency

There is no exclusive possession as the access is unrestricted

Answer

A

There could be exclusive possession as access is restricted

Access by the landlord is restricted to only if there is an emergency. This is more of an acknowledgement by the licensor that there is exclusive possession (as it has to reserve this right) rather than a clause that will defeat it. The fact that the licensor retains a key is inconclusive, it is whether access is restricted or unrestricted which will be the determining feature.

Question 44

Q

Which of the following statements is true about the application of Street v Mountford to business tenancies?

The case applies equally to business arrangements as to residential ones

The case has no application to business arrangements

Business occupiers would only need to establish they have a certain term

An arrangement relating to business premises will always be a lease

The case only applies to certain business arrangements

Answer

A

The case applies equally to business arrangements as to residential ones

A business tenant must also show they have a certain term and exclusive possession in order to show they have a lease, rather than a licence.

Question 45

Q

Which of the following situations would indicate a business occupier does not have exclusive possession of premises it is occupying?

The landlord grants security of tenure to the tenant

The landlord can relocate the occupier upon given notice

The occupier is not permitted to alter the premises

The landlord retains a key for the premises

The landlord retains a right of access in the event of an emergency

Answer

A

The landlord can relocate the occupier upon given notice

In Dresden Estates v Collinson [1988] 55 P & CR 47 a clause entitled the licensor to relocate the occupier was held to defeat exclusive possession.

Question 46

Q

Why might the courts be more willing to accept the label given to an agreement by the parties where the parties are in a commercial arrangement?

The courts will always have regard to the label given to an arrangement by the parties

The bargaining power between commercial entities tends to more equal

This is the principle laid down in the case of Street v Mountford [1985] AC 809

Commercial entitles will always be represented by solicitors so will have had legal advice

Answer

A

The bargaining power between commercial entities tends to more equal

The courts are more prepared to accept the reality of the label ‘licence’ than they are in the residential context as there tends to be more equality in bargaining power, with commercial leases often negotiated and parties legally represented.

Question 47

Q

Your client has agreed to purchase the unregistered freehold of a large farm. The seller signs and dates the transfer deed in the presence of a witness who attests the seller’s signature.

Which of the following statements best describes your client’s position in respect of the legal ownership of the farm?

The seller holds the property on trust for the client until the transfer is registered with the Land Registry

The transfer deed is of no effect because it does not include all of the terms expressly agreed by the parties

The client holds the legal title but it will revert back to the seller if not registered within two months

The transfer will not take effect at law until title is registered with the Land Registry

The transfer deed is of no effect because the client has not signed the document

Answer

A

The client holds the legal title but it will revert back to the seller if not registered within two months

This is correct. The transfer of the unregistered freehold has been effected by deed so the legal title passes to the client on completion, who then has two months to register the land for the first time. See ss 4, 6 and 7 Land Registration Act 2002.

Question 48

Q

A purchaser has agreed to buy the registered freehold of a large office block. The buyer and seller both sign a document headed ‘deed’ and their signatures are attested by a witness. The document is then dated.

Which of the following statements best describes the legal position?

The purchaser holds the legal title to the property

The transfer will not take effect at law until title is registered with the Land Registry

The purchaser holds the legal title but it will revert back to the seller if not registered within two months

The purported deed is defective but a contract may be construed from the failed grant

The purported deed is defective and the purchaser has no interest in the property

Answer

A

The transfer will not take effect at law until title is registered with the Land Registry

This is the best answer. The transfer must be completed by registration to take effect at law. See LRA 2002, s27(2)(a) and s27 (1).

Question 49

Q

You act for a refuse collection and disposal company. who recently entered into negotiations with Waste Limited, the owner of a landfill site. Waste Limited has offered your client the opportunity to use the site. The first offer is a 12-month licence to use the site for a payment of £200,000. The second (alternative) offer is the grant of a 12-month lease of a specified part of the site for a payment of £225,000. In either case the maximum amount of refuse that your client may deposit is 25 metric tonnes.

Which of the following options is the best advice to your client as to which offer they should accept?

Your client should accept the lease because it would give it a personal right in the land

Your client should accept the lease because it will entitle R to sue for breach of contract should Waste Limited breach the terms

Your client should accept the lease because it would enable it to recover use of the right to use the site if Waste Limited subsequently tried to revoke the right.

Your client should accept the licence because it is capable of being enforced against third parties should Waste Limited sell the site

Your client should accept the licence because it would give it a proprietary right in the land

Answer

A

Your client should accept the lease because it would enable it to recover use of the right to use the site if Waste Limited subsequently tried to revoke the right.

This is correct. A lease is a proprietary right in the land. This means it is enforceable in rem, the right can be recovered. A licence is a personal right, which means the right cannot be recovered if Waste subsequently tried to revoke it, because a personal right is enforceable in personam.

Question 50

Q

A buyer and seller enter into an agreement to buy/sell a freehold estate. They enter into a document which is described as a contract for the sale of land. The document contains all the agreed terms and is signed by the seller in the presence of a witness who attests their signature.

Which of the following options correctly describes the validity of this document?

The document is invalid because it has not been registered at the Land Registry yet

The document is valid because it complies with the requirements for a land contract

The document is invalid because it does not comply with the requirements for a land contract

The document is valid because it complies with the requirements of a valid contract for sale at law

The document is valid because it complies with the requirements for a deed

Answer

A

The document is invalid because it does not comply with the requirements for a land contract

This is correct. A contract for the sale of land must comply with LP(MP)A 1989, s 2; it must be in writing, contain all the agreed terms and be signed by both parties. The document is not a valid contract as it has not been signed by both the buyer and the seller.

There is no valid deed as the document has not been intended as a ‘deed’ or delivered. Further, the parties are trying to enter into an contract, rather than the actual transfer of the land.

If this had been validly created, it would grant the buyer an equitable interest in the land called an ‘estate contract’.

Question 51

Q

An occupier entered into a four year agreement by deed with the owner of a registered freehold building to rent a first floor flat. The agreement contains a clause in which the owner of the registered freehold agrees to clean the flat once every two days. The occupier moved into the premises 2 years ago and the freehold owner has not cleaned the premises once.

Which of the following statements best describes whether the occupier has a lease or licence?

The occupier has a licence because the cleaning clause defeats exclusive possession

The occupier has a licence because there is no certain term

The occupier has a licence because the deed has not been substantively registered

The occupier has a lease because the agreement was created by deed

The occupier has a lease because the cleaning clause is a sham clause

Answer

A

The occupier has a lease because the cleaning clause is a sham clause

This is correct. Sham clauses are those which owners of land may insert into a lease to make it look like a licence (defeating the requirement of exclusive possession) and to deny the occupier certain statutory rights which attach to a lease. The cleaning clause, if genuine, would defeat exclusive possession as it means the tenant is not able to exclude the landlord from the premises ‘once every 2 days’. Whether the cleaning clause is a sham or not depends on whether it is being exercised by the owner of the registered freehold, amongst other factors.

On the facts, the cleaning clause hasn’t been exercised once in 2 years. The court would therefore ignore the clause. On the facts there is a certain term and nothing else to suggest the occupier doesn’t have exclusive possession. The agreement has been created by deed, which are the correct formalities for a 4 year lease. The occupier would therefore have a lease.

Question 52

Q

A freehold owner of an indoor market gives a jewellery maker a written “licence” to sell jewellery in a space in the market on weekdays from 9am to 5pm, for a weekly payment. There is no fixed term. The terms of the “licence” give the freeholder the right to choose the space each week, and also impose detailed restrictions on what the jewellery maker can sell and the layout and use of the space. The freeholder usually gives the jewellery maker the same weekly space, but on two occasions has moved them to another space.

Which of the following options best describes whether the jewellery maker(the occupier)is a tenant or licensee?

The occupier is a tenant because it is a business context, not a residential context

The occupier is a licensee because it does not have exclusive possession

The occupier is a licensee because the agreement is called a “licence”

The occupier is a licensee because there is no fixed term

The occupier is a tenant because the relocation clause would be thrown out by the court as a sham

Answer

A

The occupier is a licensee because it does not have exclusive possession

Correct answer. Caselaw shows that a moving/relocation clause, and control by the landlord, are likely to preclude exclusive possession in a business context, so the best answer is that they are likely to have a licence and be a licensee.

The other options are incorrect. It is not correct to advise that it is a licence just because it’s called a licence, or to advise that they are likely to have a lease just because it’s a business context. The lack of a fixed term does not make it a licence, because it could still be an implied periodic tenancy due to the weekly payment. There are no facts given that show the court will ignore the terms as a sham, the reality is that the relocation clause is exercised.

incorrect
The occupier is a licensee because there is no fixed term

Your answer is incorrect. The lack of a fixed term does not make it a licence, because it could still be an implied periodic tenancy due to the weekly payment.

Please review the case law on certainty of term and exclusive possession.

Question 53

Q

Which of the following statements is true in respect of an interest in land?

An interest in land is not capable of being enforced against third parties

Only legal interests in land have proprietary status

An interest in land can be enforced in rem, this means the right can be recovered if the holder is deprived of it

If the holder of an equitable interest is deprived of their right, they are automatically entitled to damages

An interest in land gives the holder of the interest a right to possess the land

Answer

A

An interest in land can be enforced in rem, this means the right can be recovered if the holder is deprived of it

This is correct. An interest in land is a proprietary right which means it is enforceable in rem and is capable of being enforced against third parties.

Question 54

Q

Where are the list of legal interests found?

LPA 1925, s 1(2)

LP(MP)A 1989, s 1

LPA 1925, s 52

LPA 1925, s 1(3)

LPA 1924, s 1 (1)

Answer

A

LPA 1925, s 1(2)

This is correct. S.1(2) of the LPA lists the interests that are capable of being legal interests.

Question 55

Q

Which of the following interests in land is only capable of being equitable in nature?

Estate contract

Easement

Right of entry

Mortgage

Answer

A

Estate contract

This is correct. An estate contract t is not a recognised legal interest under LPA 1925, s (1)(2), therefore it can only take effect as an equitable interest under LPA 1925, s 1(3).

Question 56

Q

A and B enter into a document in which A agrees not to use his land for commercial purposes, What interest in the land does B have?

An easement

No interest

An interest under a trust of land

An estate contract

A restrictive covenant

Answer

A

A restrictive covenant

This is correct. A enters into a restrictive covenant which B has the benefit of. A restrictive covenant can be defined as a promise not to do something in respect of the land.

Question 57

Q

A and B buy a piece of land together each contributing 50% of the purchase price. A is registered at the Land Registry as the legal owner. What interest (if any) does B have in the land?

A freehold estate

No interest

An estate contract

An interest under a trust of land

A restrictive covenant

Answer

A

An interest under a trust of land

This is correct. As B has contributed to the purchase price, but is not a legal owner, B does not have a legal interest in the land (i.e. B does not own a freehold estate) but equity regards B has having a beneficial interest in the land behind a trust. A trust is automatically imposed in these circumstances, with A holding the property on trust for him/herself and B.

Question 58

Q

Which statutory provision contains the legal definition of what is land?

s. 1 LPA 1925
s. 62 LPA 1925
s. 52 LPA 1925
s. 205(1)(ix) LPA 1925

Answer

A

s.205(1)(ix) LPA 1925

This is correct. The statutory definition includes; the surface of the physical land, building on the land, fixtures and incorporeal hereditaments.

Question 59

Q

Which of the following is not included within the definition of land?

Fixtures

Fittings

The benefit of an easement

Buildings

Mines and minerals

Answer

A

fittings

This is correct. Fitting are not included within the definition of land under LPA, 205(1)(ix).

Question 60

Q

Which of the following statements correctly explains the current position at law in respect of the airspace above an owner’s piece of land?

A landowner owner the upper airspace above his/her land

A landowner owns the lower airspace above his/her land

A landowner owns everything up to the heaven’s above.

A landowner only owns the surface of the land upon which the buildings rest. It does not own any of the air above it.

Answer

A

A landowner owns the lower airspace above his/her land

This is correct. A land owner has rights in what is classed as the lower airspace above his/her land.

Question 61

Q

A satellite dish is overhanging onto an adjoining piece of land, though is not causing any damage to the land. Which of the following options correctly explains whether this is trespass?

Yes the satellite dish would be committing trespass as it is in the lower airspace above the land.

No the satellite dish is not damaging the land, therefore it is not committing trespass.

No the satellite dish would not be committing trespass as it is in the upper airspace above the land.

Yes the satellite dish would be committing trespass as it is in the upper airspace above the land.

Answer

A

Yes the satellite dish would be committing trespass as it is in the lower airspace above the land.

This is correct. The satellite dish would be classed as trespassing into the lower airspace of the land. The lower airspace is the area above the physical land which is reasonably necessary for a landowner’s use and enjoyment of the land, it does not matter that no damage is being caused to the land. The facts of this case are similar to Kelsen v Imperial Tobacco Co.

Question 62

Q

Which of the following statements correctly explains the current position at law in respect of the ground below an owner’s piece of land?

A landowner owns up to depths of 600 metres under the Infrastructure Act 2015, s43

A landowner owns only the surface of the land

S/He who owns the land owns everything to the depths below.

A landowner owns the ground under the surface to depths above 300 metres

Answer

A

A landowner owns the ground under the surface to depths above 300 metres

This is correct. The Infrastructure Act 2015, s43 effectively states there is no trespass at depths below 300 metres.

Question 63

Q

Within the definition of land under LPA 1925, s.205 (1)(ix) a fixture would be classed as which of the following?

An incorporeal hereditament

Chattel

A corporeal hereditament

A privilege derived from land

Answer

A

A corporeal hereditament

This is correct. Corporeal hereditaments are things attached/fixed to the land, what we call fixtures in practice.

Question 64

Q

Which of the following statements correctly describes the legal position in respect of fixtures?

Fixtures will only pass to a buyer of land if they are included in the sale

An item not attached to the land can be a fixture if it part of the architectural design of a building

An item not attached to the land can never be a fixture

If something is attached to the land it will always be a fixture

Answer

A

An item not attached to the land can be a fixture if it part of the architectural design of a building

This is correct. If chattels are incorporated into the architectural design of a building, they may consequently be classified as fixtures even though they are not firmly affixed. This can be seen in D’Eyncourt v Gregory (1866) LR 3 Eq 382 where a stone garden seat and ornamental statues standing on their own weight were held to be fixtures as forming part of the architectural design of the house and its grounds.

Answer 65

A

The purpose of annexation test

This is correct. The ‘purpose test’ prevails over the ‘degree test’ where there is a discrepancy between them (Holland v Hodgson (1872) LR 7 CP 328)

Answer 66

A

It will depend on the circumstances of the case. If the picture can be removed easily and put in place to enjoy as pictures, it is likely to be a chattel.

This is correct. Such a situation is analogous to the facts of Berkley v Poulett [1977] 1 EGLR 86, and as Lord Justice Scarman states: “if ordinary skill was used, as it was, in their removal, they could be taken down, and in the event were taken down, without much trouble and without damage to the structure of the rooms. The decisive question is therefore as to the object and purpose of their affixing. …I find, applying the second test, that the pictures were not fixtures. They were put in place on the wall to be enjoyed as pictures.”

Answer 67

A

The mortgagor is the borrower.

This is correct. The mortgagor is the borrower, who grants the mortgage as security for the loan.

Answer 68

A

They will be charged a low interest rate

When the borrower is a low risk party, s/he will usually be charged a low interest rate.

Answer 69

A

Capital and interest repayments

Correct. Each month the borrower pays an instalment which consists partly of repayment of capital and partly interest on the outstanding balance.

Answer 70

A

The mortgage will be equitable provided that it is in writing which contains all the terms and is signed by both parties.

Correct. A failed legal mortgage will be treated as a contract to create a legal mortgage if it complies with LP(MP) A 1989, s 2.

Answer 71

A

A mortgage is capable of being a legal or equitable interest in land.

Correct. See LPA 1925 ss 1(2)(c) and 1(3).

Answer 72

A

Deed and substantive registration.
Correct. All legal interests must be created by deed LPA 1925, s 52; LP (MP) A 1989, s1; and the transaction must be registered to be legal LRA 2002, s27(2)(f).

Answer 73

A

The clause was struck out because once the loan was repaid, the borrower would get back an estate which was worth much less than at the time of the mortgage.

Correct. The borrower would not get back an unencumbered leasehold which was exactly what he had mortgaged. A leasehold estate is a depreciating asset, and a lease with only 6 weeks left to run, is very different to a lease with 17 years left to run.

Answer 74

A

When it is granted in a substantially separate transaction.

Correct. Warnborough V Garmite said that the whole transaction must be looked at to see if it is substantially a mortgage or not. If it is a mortgage, the option will not be allowed and vice versa.

Answer 75

A

The solus tie will be permitted in a commercial transaction if the tie ends before or at the end of the mortgage term.

Correct. This is the decision in Biggs v Hoddinot.

Answer 76

A

No postponement or prevention of redemption

Correct. The equitable right to redeem does not arise until 6 weeks before the end of the mortgage term. Courts look at clauses which postpone the legal date for redemption very closely and would consider whether, on the facts, the right to redeem is rendered valueless.

Answer 77

A

There should be no postponement of the legal right to redeem

An option to purchase is a clog on the equity of redemption

A collateral advantage will be struck out if unconscionable

A borrower has the right to be protected from unconscionable terms

Answer 78

A

On the day after the legal date for redemption has passed.

Correct. Equity softened the harsh common law rule by allowing the borrower to repay at any time after the legal redemption date has passed.

Answer 79

A

Law of Property Act 1925, s 1(2)(a).

This is correct. This section states that an easement granted or reserved for the equivalent of a freehold estate (ie indefinitely / forever) is capable of being a legal interest in land.

Answer 80

A

a right to light

This is correct. A negative easement is an easement which is enjoyed from the dominant owner’s own land and does not involve entering or using the servient land at all.]

Answer 81

A

a covenant

This is correct. the primary function of a restrictive covenant is to restrict what is be done on the servient land.

Answer 82

A

an express grant

This is correct. The right is express as it is in writing, and it is a grant as it is a right which A creates in favour of B

Answer 83

A

implied grant

This is correct. The right is not in writing and must therefore be implied. It is a grant not a reservation as it is a right which is in favour of D’s land that has been transferred.

Answer 84

A

20

Easements may arise by prescription or ‘long use’. Generally an easement is claimed by prescription where it has been exercised over land for a long time (at least 20 years), yet no express grant or reservation can be traced.

Answer 85

A

No, the right has been exercised with the use of force?

This is correct. A prescriptive easement must be exercised without force. Force includes the removal of obstructions, or ignoring the protests of the servient owner, which would include the ignoring of signage.

Answer 86

A

no

Although the right has been exercised for over 20 years, a prescriptive right can only be created as between two freehold owners.

Answer 87

A

No, there is no defined aperture in a garden

There is no general right to light. A right to light must be via a defined aperture eg a window. Rights to light do not attach to gardens or open land.

Answer 88

A

Re Ellenborough Park

This is correct. This case sets out the four criteria which must be met in order for an easement to be capable in principle of being an easement.

Answer 89

A

The use of the right must not amount to exclusive possession of the servient land.
This is correct. A right which passes the tests in re Ellenborough Park will nevertheless be disqualified on this basis.]

Answer 90

A

The right must have a direct beneficial impact on the dominant land.

This is correct. Lord Oliver’s test in essence requires the easement to benefit the land itself, not simply the dominant owner personally.

Answer 91

A

Borman v Griffith

This is correct. Judicial recognition is an essential element which must be satisfied if a right is to be capable of being an easement.

Answer 92

A

Positive easements only

This is correct. New negative easements would unduly restrict the use of the servient land: Phipps v Pears.

Answer 93

A

Batchelor v Marlow

This is correct. Batchelor v Marlow sets out the ouster principle test.

Answer 94

A

The easement must not leave the servient owner with no reasonable use of the servient tenement.

This is correct. The ouster principle is sometimes called the reasonable user test.

Answer 95

A

Moncrieff v Jamieson

This is correct. This Scottish case, which is persuasive authority only, introduced an alternative test.

Answer 96

A

A need not repair the lane but must allow B access to do the repairs: Jones v Pritchard.

This is correct. There is no obligation on the servient owner to carry out repairs.

Answer 97

A

Green v Ashco

This is correct. The essence of an easement is that it is enjoyed as of right.

Answer 98

A

Law of Property Act 1925, s 1(2)(a)

This is correct. The section makes it clear that to be legal, an easement must be granted it reserved for the equivalent of a freehold or leasehold term.

Answer 99

A

Law of Property Act 1925, s 52

This is correct. An express legal easement must be created by deed.

Answer 100

A

Deed + registration

This is correct. LPA 1925, s 52 and LRA 2002, s 27(2)(d) respectively provide a deed must be used, which must then be substantively registered.

Answer 101

A

The right may be recognised as an equitable easement if it complies with Law of Property (Miscellaneous Provisions) Act 1989, s 2.

This is correct. A failed legal easement may be treated as an enforceable contract to create a legal easement if the failed legal easement complies with the formalities for an estate contract.

Answer 102

A

It must be created in writing, signed by the grantor only.

This is correct. These are the formalities for a basic equitable interest set out in Law of Property Act 1925, s 53(1)(a).

Answer 103

A

Pryce v McGuinness

This is correct. It was held that drains and sewers are not absolutely necessary for the enjoyment of land, so the claim failed.

Answer 104

A

‘Absolute necessity’: the land cannot be used at all without the easement

This is correct. This is the test which was applied in Manjang v Drammeh and Pryce v McGuinness.

Answer 105

A

It recognised a right of way by vehicle as being implied by necessity, even though there was already a right of way on foot and the land was not inaccessible.

This is correct. The case appears to expand the scope to allow rights of way for land which is not actually landlocked.

Answer 106

A

A right of ventilation

This is correct. The claimant required a right to ventilation by common intention of the parties as this was essential to the operation of the premises as a restaurant.

Answer 107

A

The original parties must have been landlord and tenant.

This is correct. This method of implying easements does not require the original parties to be landlord and tenant. This method would also work if one party had bought part of the other’s land, instead of leasing it.

Answer 108

A

The surrounding land was shown as building plots on the transfer plan.

This is correct. Although other circumstances were taken into account, the court placed particular emphasis on the transfer plan as being evidence of the common intention of the parties.

Answer 109

A

Grants and reservations

This is correct. Whilst some methods of implied acquisition operate only on grants, this method is not so restricted.

Answer 110

A

Grants only

This is correct. Courts are reluctant to ‘derogate from grant’: in other words they are reluctant to acknowledge a right which was not specifically reserved by the dominant landowner, whether that person let or sold the servient land.

Answer 111

A

There must be a quasi-easement exercised for the benefit of the land now owned by the claimant.

This is correct. There must have been a single owner who enjoyed the right now claimed as an easement, for the benefit of that part of the land which is now the dominant tenement. The benefit becomes an easement once the ownership of the land is in different hands.

Answer 112

A

The right is necessary for the convenient and comfortable enjoyment of the land.

This is correct. The definition of the word ‘necessity’ in this context is much more relaxed than in cases on easements implied by necessity or by common intention of the parties.

Answer 113

A

Deeds or contracts

This is correct. Wheeldon v Burrows has a wider scope than Law of Property Act 1925, s 62 in that it operates on contracts as well as deeds.

Answer 114

A

The right must touch and concern the dominant land.

This is correct. This concept is part of the rules on capability which must be fulfilled before we even consider whether the right has actually been acquired.

Answer 115

A

Grants only

This is correct. Courts are reluctant to ‘derogate from grant’: in other words they are reluctant to acknowledge a right which was not specifically reserved by the dominant landowner, whether that person let or sold the servient land.

Answer 116

A

Deeds only

This is correct. Law of Property Act 1925, s 62 has a narrower scope than the rule in Wheeldon v Burrows in that it only operates on deeds.

Answer 117

A

The section operates in situations where land is sold or let for the first time, and in situations where part of the land has previously been occupied by a tenant but the lease is renewed or that land sold.

This is correct. Although case law had suggested that the section only operated where there had previously been a landlord and tenant situation, it is now settled law that the section also operates on quasi-easements to imply an easement into a transfer deed or lease where the land is let for the first time.

Answer 118

A

Wood v Waddington

This is correct. Although Platt v Crouch reached the same decision, Wood v Waddington is a Court of Appeal authority and thus carries greater weight.

Answer 119

A

Law of Property Act 1925, s 62

This is correct. The ordinary operation of s 62 operates as a word-saving provision, stating amongst other things that all rights privileges and easements which benefit the dominant land automatically pass on a transfer of that land.

Answer 120

A

The easement must be held by someone who is in actual occupation of the servient land.

This is correct. This provision is not listed as a condition in Schedule 3, paragraph 3. It relates to equitable interests which are held by people in actual occupation of the land in question. Although Chaudhary v Yavuz suggests obiter that an equitable easement could be an overriding interest based on actual occupation, there is no direct authority on this.

Answer 121

A

The covenantee can sue if the covenant is breached

The covenantee owns the land which has the benefit of the covenant and is able to enforce the covenant if it is breached

Answer 122

A

A covenant which restricts what can be done on the land

A negative, or restrictive, covenant is a promise which limits what can be done on the burdened land

Answer 123

A

The person who enters into the covenant and owns the servient land

This is correct. The covenantor is the person who enters into the covenant and is subject to the burden of the promise. That person’s land is the burdened or servient land.

Answer 124

A

A covenant which obliges the owner of the land to do something

This is correct. A positive covenant obliges the covenantor to “put their hand in their pocket” and do something to comply with the covenant, either spend money or energy. The covenant cannot be complied with by inaction.

Answer 125

A

Look at underlying substance of the covenant rather than the precise words used.

The correct approach is to look beyond the words used to see the effect of the covenant in practice. It is the substance of the covenant, rather that the words used to express it, which is important.

Answer 126

A

Haywood v Brunswick

This case sets out the ‘hand in pocket’ test, which states that if performance of a covenant requires expenditure of money, it is a positive covenant.

Answer 127

A

A covenant not to allow a fence to fall into disrepair

This is a positive covenant as the substance of the covenant is to maintain the fence in a good state of repair.

Answer 128

A

A covenant to use the land for residential purposes only

This is a restrictive covenant as it restricts the use which can be made of the land.

Answer 129

A

This is a mixed covenant which is predominantly negative with a positive condition attached

This is a predominantly negative covenant as the primary obligation is not to build on the land. The positive condition cannot stand alone but is only relevant when read alongside the main obligation.

Answer 130

A

Whether the covenant is enforceable by and against successors in title to the original parties

The legal problem here is that there is no contractual relationship between successors in title to the original parties. We look at whether the relevant rules have been observed to enable a successor in title to the covenantee to enforce a covenant direct against a successor in title to the covenantor.

Answer 131

A

That the benefit of the covenant has passed to them

A successor in title can only enforce a covenant if they can show that the benefit of the covenant has passed to them, as it is holding the benefit of the covenant which enables a party to sue.

Answer 132

A

That the benefit of the covenant has passed to the successor covenantee and that the burden of the covenant has passed to the successor covenantor

In order for the covenant to be enforced by a successor covenantee, they must show that they have the benefit of the covenant to enable them to sue. In order to enforce the covenant against a successor covenantor they must show that the successor covenantor has the burden of the covenant to enable them to be sued.

Answer 133

A

The burden of a covenant does not pass at common law

A covenant is essentially enforceable on common law contractual principles. The general rule is therefore that the covenant is personal between the parties and the burden of the covenant cannot therefore pass to a new servient owner.

Answer 134

A

LPA 1925, S 1(3)

A restrictive covenant is an equitable interest in land: it is not listed in LPA 1925, s 1(1) which sets out the legal estates; nor in s 1(2) which sets out the legal interests. It is included in the residual category of s 1(3) which says that all other previously recognised interests in land (other than the ones in ss 1(1) and 1(2) are now equitable.

Answer 135

A

LPA 1925, s 53(1)(a)

As a restrictive covenant is an equitable interest in land, the formalities for equitable interests apply: the covenant must be created in writing and be signed by the grantor. Generally however, the covenant is created much more formally by being contained in a transfer deed.

Answer 136

A

There must be an intention for the benefit to pass

The intention for the benefit to pass relates to the passing of the benefit and has not place in the test for passing the burden.

Answer 137

A

LPA 1925, s 79

Answer 138

A

The covenant is not binding LRA 2002, s 29(1)

A covenant must be protected by a notice in the charges register LRA 2002, s 32. If this is not done, s 29(1) says that the covenant will not bind the purchaser for value.

Answer 139

A

Renals v Cowlishaw

Renals v Cowlishaw identifies the three ways by which the benefit of a covenant can pass.

Answer 140

A

LPA 1925, s 78

S 78 operates to annex the benefit of a covenant to the dominant land as soon as the covenant is made, unless this is expressly excluded.

Answer 141

A

The assignment must be in writing and signed by the person disposing of the benefit, LPA 1925, s53(1)(c).

This is correct. The benefit is treated as the disposition of an equitable interest in land and the formalities in LPA 1925, s 53(1)(c) must be complied with.

Answer 142

A

The benefit of a restrictive covenant will pass if the parties intended to create a scheme of mutually enforceable obligations

The test concerns the intention of the parties, relaxing the strict requirements set out in Ellison v Reacher.

Answer 143

A

The benefit of the covenant forms part and parcel of the dominant land from the time of creation and automatically passes to a new owner of the dominant land when the land is transferred

This is the most comprehensive definition of annexation, which operates to make the benefit an integral part of the dominant land itself.

Answer 144

A

A court order which requires a breach of covenant to cease. It is a discretionary remedy.

A prohibitory injunction cannot be requested as of right. It is a court order granted at the discretion of the court which orders the person breaching the covenant to stop doing so.

Answer 145

A

Equitable damages in lieu of an injunction, calculated to reflect the theoretical payment which the dominant owner might have expected to receive in order to release the land from the covenant.

The court exercised its discretion and refused to grant an injunction to knock down houses built in breach of covenant. The court felt that the dominant tenement did not suffer a reduction in value as a result if the breach, and that ordering an injunction would have involved a waste of money, time and utility. If the servient owner had asked the dominant owner to release the land from the covenant, a fee would have been paid. The court awarded damages which reflected the fee which would have been paid had the servient owner formally asked for the land to be released from the covenant.

Answer 146

A

A prohibitory injunction

Where land is being used continually in breach of covenant, it is likely that the court will make an order requesting the breach to cease.

Answer 147

A

Austerberry v Oldham Corporation

Austerberry v Oldham Corporation states that at common law, the burden of an obligation cannot pass to the successor in title of the original covenantor.

Answer 148

A

All covenants of whatever type

The general common law rule applies to all covenants of whatever nature. Generally, the burden of an obligation will not pass to a successor in title.

Answer 149

A

Damages only

As the original covenantor is no longer in possession of the land, they cannot carry out the terms of an injunction or order for specific performance. The only remedy which can be awarded is damages.

Answer 150

A

The section implies wording into freehold covenants to make the original covenantor liable for all breaches of covenant by any successor in title.

The section makes the original covenantor liable for all breaches of covenant by any person who holds the land after the original covenantor has parted with it. It does not pass the burden of the covenant.

Answer 151

A

It enables the original covenantor to recover any damages paid out in respect of a successor’s breach. The damages can only be recovered from the original covenantor’s immediate successor in title.

An indemnity covenant is made between the original covenantor and his successor in title and is personal to them. If the original covenantor pays out damages for a successor’s breach, the indemnity covenant enables the original covenantor to recover the outlay from the immediate successor in title, who may not be the person in breach.

Answer 152

A

There must be a close link between the benefit in the nature of an easement and the burden of the covenant.

Rhone v Stephens restricted the scope of Halsall v Brizell as it had been thought that the benefit and the burden simply had to be conferred in the same transaction. It made it clear that the benefit and burden had to be directly linked.

Answer 153

A

Enter a restriction on the proprietorship register of the burdened land (LRA 2002, s 40).

The restriction is placed in the proprietorship register of the burdened land and requires the consent of the covenantee to the registration of the purchase of the burdened land. This consent is given subject to the successor covenantor entering direct covenants with the covenantee.

Answer 154

A

Halsall v Brizell

Halsall v Brizell gives the mutual benefit and burden exception to the general rule. Its scope was refined in subsequent cases.

Answer 155

A

In writing, with notice given to the covenantor: LPA 1925, s 136.

The assignment can be made simply in writing, but notice must be given to the covenantor. This is to inform the covenantor that a new person is entitled to enforce the covenant.

Answer 156

A

P&A Swift Investments v Combined English Stores plc

Correct. This case sets out the 4 requirements for implied assignment of the benefit of a covenant at common law.

Answer 157

A

The buyer covenants with the intention of benefiting land know of 31 Yew Tree Close to only use the land for residential purposes

Intention of the parties is expressed here with the reference to the covenant ‘benefiting land know as…’

If there is no express intention, LPA 1925, s 78 implies an intention for the benefit to pass unless it is expressly excluded.

Answer 158

A

The covenant does not touch and concern the dominant land

A covenant to wash the covenantee’s car every week will not touch and concern the land as it has no impact on the quality, enjoyment or utility of the land. It is simply a personal privilege.

Answer 159

A

The Upper Tribunal (Lands Chamber)

The Upper Tribunal (Lands Chamber) has jurisdiction to hear applications of this nature.

Answer 160

A

LPA 1925, s 84(1)

S 84(1) gives the Upper Tribunal (Lands Chamber) the power to discharge the whole or part of a covenant.

Answer 161

A

Restrictive covenants only

S 84(1) specifically states that the tribunal can only discharge or modify restrictive covenants.

Answer 162

A

The original dominant owner has sold the dominant land and cannot be located in order to execute a formal discharge

There is no provision in s84(1) LPA 1925 for an application to be made simply because the dominant owner has sold the land. In fact, the appropriate person to execute a discharge is the current dominant owner, but even so, there is no provision in the statute for this type of application.

Answer 163

A

Trusts of Land and Appointment of Trustees Act 1996

This is correct. This statute deals with the powers and duties of trustees and beneficiaries and the resolution of disputes relating to trusts of land.

Answer 164

A

The declaration of trust must be evidenced in writing signed by the person creating the trust.

This is correct: Law of Property Act 1925, s 53(1)(b)

Answer 165

A

A holds the property on resulting trust for A and B

This is correct. Where, in a non-domestic context, someone makes a direct contribution to the purchase price, a resulting trust is implied to reflect their contribution

Answer 166

A

They are trustees acting in an administrative capacity

This is correct. The legal owners are named as the proprietors in the register, but have duties of trusteeship. They have the power to sign transfer deeds, contracts and mortgage documents but they hold the property on trust for the beneficiaries.

Answer 167

A

Unity of possession

This is correct. Without unity of possession, there is no co-ownership.

Answer 168

A

The co-owners’ interests must all take effect at the same time.

Answer 169

A

When a joint tenant dies, that person’s notional interest immediately accrues to the surviving joint tenants.

This is correct. Joint tenants are viewed as a single entity and therefore do not have a distinct ‘share’ of the property. Instead they have a notional interest which disappears on their death meaning the property accrues to the surviving joint tenants.

Answer 170

A

A distinct but undivided share in land

This is correct. A tenancy in common is a distinctly quantified share in the whole property, but the holder cannot say that any particular part is theirs: hence, ‘undivided’ share.

Answer 171

A

Where there have been unequal contributions to the purchase price

This is correct. This will be presumed in non-domestic cases only. The presumption can be rebutted by an express declaration of an equitable joint tenancy.

Answer 172

A

It changes the basis on which the equitable title will be held in future

This is correct. Severance does not destroy co-ownership but simply changes the basis on which the parties hold the equitable interest in the future

Answer 173

A

It will have no effect

This is correct. A will does not have any effect until after death by which time survivorship has operated.

Answer 174

A

C continues as legal joint tenant but has 25% of the equitable title as tenant in common

This is correct. The legal joint tenancy cannot be severed. If the equitable joint tenancy is severed the holder takes an equal share as tenant in common, irrespective of the size of their initial contribution

Answer 175

A

A and B are now tenants in common as to 50% each

This is correct. When the joint tenancy was severed, A received an equal share irrespective of the size of A’s initial contribution: Goodman v Gallant

Answer 176

A

On all equitable joint tenants

This is correct. The equitable joint tenants are the only people who will be affected by the severance and LPA 1925, s 36(2) specifically states that they must all be served.

Answer 177

A

The notice need not comply with any formalities

This is correct. No statutory formalities are prescribed

Answer 178

A

A divorce petition

This is correct. The wife asked in her divorce papers for an immediate order for sale of the property and equal split of the sale proceeds. Although the main point of the ‘writing’ here was to instigate divorce proceedings, the contents were sufficient to show the requisite intention to sever the joint tenancy

Answer 179

A

When it is delivered to the last known place of abode or business of the addressee

This is correct. Severance takes effect on service, and not when/if the notice is actually read: Kinch v Bullard

Answer 180

A

The sender can revoke the notice if he informs the addressee before the notice is served that he wishes to revoke it.

Answer 181

A

A mortgage of an equitable interest

This is correct. A mortgage is an act of partial alienation because when the loan is repaid the owner will retain the equitable interest unencumbered.

Answer 182

A

The joint tenancy was severed by mutual agreement with each party receiving a 50% share as tenant in common.

This is correct. The mutual agreement was evidenced by the draft consent order in divorce proceedings. The shares were equal, based on the number of joint tenants: the rule in Goodman v Gallant prevailed over the terms of the draft consent order.

It is true to say that shares would be calculated in accordance with Goodman v Gallant based on the number of joint tenants; but you should review the case of Hunter v Babbage and compare it to the case of Gore and Snell v Carpenter.

Answer 183

A

The parties had negotiated on the basis that their assets including the house would be realised and divided.

This is correct. The parties had always envisaged a split of the sale proceeds of the house and other assets and had conducted negotiations on that basis.

Answer 184

A

Because it was not possible to infer from ongoing negotiations any mutual working towards a final end in view

This is correct. The negotiations did not have any particular aim (unlike in Davis v Smith) and there was no evidence that there was no ‘mutual’ acceptance that Mrs Carpenter would hold tenancies in common. In that situation, the parties were not ‘mutually’ conducting themselves towards the same end.

Answer 185

A

An express or inferred agreement to change the basis on which co-ownership will continue

This is correct. Co-ownership does not end on severance of the joint tenancy: it continues on a different basis. An agreement to do this can be expressly stated, or (as in this case) inferred from what the parties said and did.

Severance does not result in the end of co-ownership, so there is no requirement to agree to do this in order to sever. Review Burgess v Rawnsley

Answer 186

A

The trustees must have regard to the rights of the beneficiaries

This is correct: TLATA 1996, s 6(5)

Answer 187

A

Because the trustees do not have to act on the beneficiaries’ wishes unless in the general interests of the trust

This is correct. The trustees need only consult so far as is practicable and only need give effect to the beneficiaries’ wishes so far as is in the general interest of the trust.

Answer 188

A

The land must be suitable for occupation by beneficiaries generally

This is correct. There is no requirement that the land must be suitable for any beneficiary (whether under this trust or another). The requirement is that the land must be suitable for the particular beneficiary who wishes to occupy

Answer 189

A

The land is not intended to be occupied by them

This is correct. The purpose of the trust is to generate income by letting the flat. In those circumstances the beneficiaries do not have the right to occupy: TLATA 1996, s 12(1)

Answer 190

A

Anyone who has an interest in the land

This is correct. This means that legal trustees, beneficiaries, and secured creditors can all make applications.

Answer 191

A

None – the statute gives no indication of any factor having greater weight than the others.

This is correct. There is nothing in TLATA 1996, s 15 which states that any factor is to be given greater weight than others.

Answer 192

A

Mortgage Corporation v Shaire

This is correct. The judge said that the law had changed with TLATA 1996 and all factors had to be weighed evenly.

Answer 193

A

Fred Perry v Genis

This is correct. Despite the decision in Mortgage Corporation v Shaire and the fact that TLATA 1996, s 15 does not give greater weight to any particular factor, the court prioritised the interests of creditors.

Answer 194

A

Matrimonial home

This is correct. The property was held as a home for the couple. When they separated, the joint purpose had come to an end and an order for sale was made. Although one party wanted the purpose to continue, it is not possible unilaterally to carry out a joint purpose.

Answer 195

A

Payment of market rent

If there is a degree of formality to the occupation agreement and/or a rent is paid then this would evidence an intention to create legal relations between the parties.

Answer 196

A

The occupation is an act of generosity from a family member

In Facchini v Bryson [1952] 1 TLR 1386, Denning LJ set out the circumstances from which a lack of intention to create legal relations can be deduced, making an arrangement simply a licence. He said that where there is a family arrangement, an act of friendship or generosity, it can be presumed that there is a lack of such intention.

Answer 197

A

A teacher living in a house at the school in order to assist with boarding house duties

This teacher is living at the school for the ‘better performance of his/her duties.’ This is similar to Norris v Checksfield [1991] 1 WLR 1241 and would be classed as a service occupancy.

Answer 198

A

The occupation is an act of generosity

In Facchini v Bryson [1952] 1 TLR 1386, Denning LJ set out the circumstances from which a lack of intention to create legal relations can be deduced, making an arrangement simply a licence. He said that where there is a family arrangement, an act of friendship or generosity, it can be presumed that there is a lack of such intention. This presumption can be rebutted though, and just because an agreement is between family members/ friends, it does not mean it will not be a lease if there is a degree of formality to the arrangement / market rent is payable.

Answer 199

A

All of the interests must derive from the same document or from separate but identical documents which are interdependent

As it was held in Antoniades v Villiers [1990] 1 AC 417, the occupiers need not sign the same document for there to be unity of title providing they sign identical documents that are interdependent.

Answer 200

A

All must have a leasehold interest for the same term under the same conditions and must be jointly liable for the rent

All the occupiers must be subject to the same terms/conditions of occupation and must hold the same interest in the land meaning the same lease term and restrictions. All the occupiers must also be jointly liable for the rent, meaning they are each fully liable for the whole rent, rather than just for a share of it.

Answer 201

A

Unity of possession

All occupiers must be entitled to occupy the whole of the premises. No-one has exclusive use of any part. The occupiers could only ever be individual licensees sharing with other in this instance.

Answer 202

A

No, as they do not have unity of time.

In order for there to be unity of time, all of the interests must start at the same time, which is not the case here. If it is found that the occupants do not have the four unities, they cannot have a joint tenancy.

Answer 203

A

They will not have a joint tenancy and cannot hold a lease together. However, if they can individually show exclusive possession of part of the property, they may have individual leases of their own part

If it is found that the occupants do not have the four unities, they cannot have a joint tenancy. But if they can show that they each have exclusive possession of a part of the property then it is possible for them to have individual leases of their own part. If neither a joint tenancy nor an individual tenancy exists then the occupants can only be individual licensees sharing with each other.

Answer 204

A

The agreement can bind new owners of the freehold.

Answer 205

A

No estate of land is granted.

Answer 206

A

Letting for a fixed term of one year of a member’s golf club.

The definition of ‘business’ (in s 23(2) of the Landlord and Tenant Act 1954 includes a ‘trade, profession or employment and includes any activity carried on by a body of persons, whether corporate or unincorporate’.

A fixed term tenancy not exceeding six months will generally not be protected by the 1954 Act (s.43(3)). The letting of the shop for a fixed term of six months will not be protected (unless it contains provisions for renewing the term or extending it beyond six months, or if the tenant has already been in occupation for a period exceeding 12 months).

A tenancy at will is not a legal estate as it does not fall within the definition of a term of years absolute in the Law of Property Act 1925. Hagee (London) Ltd v AB Erikson and Larson [1975] 3 All ER 234 confirmed that a tenancy at will does not fall within the protection of the 1954 Act.

A licence cannot be protected by the 1954 Act because it is not a tenancy.

Answer 207

A

The landlord must serve a warning notice on the tenant and the tenant must make a statutory declaration.

Correct.

The warning notice is served by the landlord on the tenant and the tenant makes a declaration.

On these facts the tenant’s declaration must be a statutory one as there will not be the necessary 14 days for a simple declaration between the warning notice being served (which would happen today at the earliest) and the agreement for lease being completed (tomorrow). It is the completion of the agreement for lease rather than completion of the lease which is the relevant date as the tenant’s declaration must be made before the tenant becomes bound to enter into the lease ie before the tenant completes the earlier of the lease or an agreement for lease (if there is one, as here).

Answer 208

A

The Tenant serves the warning notice on the Undertenant and the Undertenant can enter into a simple declaration or a statutory declaration.

Correct.

It is the immediate landlord who must serve the warning notice. On these facts, the immediate landlord for the underlease is the Tenant.

The warning notice must be served on the tenant to the underlease (since the question asks about the procedure for contracting out the underlease) ie the Undertenant. So the warning notice for the underlease must be served by the Tenant on the Undertenant.

It is the tenant to the underlease ie the Undertenant who must make the declaration in respect of the contracting out of the underlease.

As there is no agreement for underlease and the underlease is not being completed until more than 14 days after the service of the warning notice, the Undertenant (the tenant to the underlease) can make either a simple declaration (as there is time to do so) or a statutory declaration.

Answer 209

A

The tenant must make a statutory declaration.

Correct.

As the warning notice is being served today and there are fewer than 14 days between the warning notice and the completion of the lease, the 14 days’ notice needed for the simple declaration procedure cannot be complied with and so the tenant must make a statutory declaration.

If there is not at least 14 days between the warning notice and the completion of the lease, the tenant can make a statutory declaration instead of a simple declaration. There is no need to delay completion of the lease so that the simple declaration procedure can be complied with.

The point of the statutory declaration is that the lease can be completed without having to wait 14 days from the service of the warning notice. If the statutory declaration procedure is used, the lease can complete when it is due to, in 7 days’ time.

Answer 210

A

A two year periodic tenancy of two floors of a building.

Correct
Correct.

A periodic tenancy is covered by the 1954 Act and a lease of part of a building is also covered by the 1954 Act. The tenant will be only be entitled to apply for a new lease of the part of the premises that it occupies.

There must be a tenancy for the 1954 Act to apply and a tenancy at will (terminable at any time by either party) is excluded.

There must be a tenancy for the 1954 Act to apply and a licence is excluded.

Under s 43 of the 1954 Act, fixed term tenancies not exceeding 6 months are excluded from the protection of the 1954 Act provided. With a first fixed term non-renewable tenancy for six months of a building, the same business or tenant has not been in occupation of the premises for 12 or more months through successive tenancies and the tenancy is not renewable beyond 6 months.

Under s 43 of the 1954 Act, service tenancies (leases granted as part of a tenant’s employment such as a lease to a housekeeper of a flat granted as part of their employment) are excluded from the protection of the 1954 Act.

Answer 211

A

Certainty of term, exclusive possession and the correct formalities.

Answer 212

A

Payment of rent, payment of service charge, use of premises, covenant against assignment and subletting.

Correct. This is usual tenant covenants contained in a lease i.e. restrictions on what the tenant can/cannot do with the premises and promises it makes to the landlord.

Answer 213

A

A landlord’s covenant not to interfere with the tenant’s possession or enjoyment of the property during the term of the lease

Answer 214

A

A list of set clauses at the front of a lease which help to speed up registration of registrable leases at the Land Registry.

Answer 215

A

The standard of repair is to keep the premises in the condition in which they would be kept by a reasonably minded owner, having regard to the character and type and age of the premises.

Answer 216

A

It is an obligation to put the premises into repair at the beginning of the term if they are out of repair and to keep them in repair throughout the term of the lease.

Correct. This obligation is therefore quite onerous if the premises are in a state of disrepair at the beginning of the lease term.

Answer 217

A

Fully qualified

Answer 218

A

The landlord has received a poor financial reference from the proposed assignee.

Correct. The landlord has refused consent on the basis of the landlord/tenant relationship. This is entirely reasonable.

Answer 219

A

The lease contains an absolute covenant against structural alterations and the tenant requests a one-off consent from the landlord to an extension affecting the structure of the property.

Correct. This is an absolute covenant and the statute has no effect here. The landlord does not need to grant consent or act reasonably in considering the request.

Answer 220

A

Qualified

Answer 221

A

When either a landlord or a tenant is allowed by the lease to bring the lease to a premature end.

Correct. A break clause may allow the landlord or the tenant or both parties to bring the lease to a premature end.

Answer 222

A

Forfeiture
Correct. This is the procedure to follow when a landlord is looking to terminate a lease early for breach of a tenant covenant.

Answer 223

A

Half a year’s notice.

Correct. It is necessary to serve at least half a year’s notice to end an annual periodic tenancy.

Answer 224

A

A right to forfeit for non-payment of rent is implied into an equitable lease.

Correct. A right to forfeit (for non-payment of rent) is implied into equitable leases only. In legal leases the right to forfeit for any breach of covenant must be expressly reserved.

Answer 225

A

In the case of business premises, a landlord may forfeit by either peaceable re-entry or by court order.

Correct. In the case of residential or mixed use premises however, a landlord may only forfeit by court order.

Answer 226

A

The landlord may not forfeit the lease as the agent (who acts for the landlord) has waived the right to forfeit. The landlord’s right to forfeit will arise in the subsequent month if no rent demand is sent out for that month’s rent payment.

Correct. This is a waiver. The landlord had knowledge of the breach and the agent, who acts for the landlord, has acted unequivocally by sending out a rent demand for next month’s rent. This is a non-continuing breach; however, the right to forfeit may arise again in the subsequent month if there is a breach of the next rent covenant.

Answer 227

A

Subletting the property without the landlord’s consent.

Correct. This is a breach of covenant that can only be committed once and cannot be undone.

Answer 228

A

The landlord must make a formal demand for the rent due on the day when it becomes payable unless the lease waives this requirement.

Correct. There is a special procedure to follow when forfeiting for non-payment of rent (unless waived by the lease).

Answer 229

A

The tenant may be granted relief after the date of the court order if all the arrears and costs are paid.

Correct. The court has a discretion to grant relief even after it has made an order to forfeit the lease on condition that all arrears and costs are paid.

Answer 230

A

The tenant may be granted relief after the date of the peaceable re-entry if all the arrears and costs are paid.

Correct. The court has an inherent equitable jurisdiction to grant relief to the tenant; this may even be some time after the landlord has forfeited the lease.

Answer 231

A

The s 146 notice must: specify the breach; if capable of remedy require the breach to be remedied within a reasonable time; ask for compensation if required by the landlord.

Correct. There is no prescribed form of s 146 notice but it must contain the correct information. This depends on whether the breach is capable of remedy and whether the landlord requires compensation from the tenant for the breach.

Answer 232

A

Subletting in breach of covenant.

Correct. This is a breach of covenant that can only be committed once and cannot be undone.

Answer 233

A

If the landlord re-entered pursuant to a court order, the tenant may be granted relief up until the time that the court order is made.

Correct. No further relief is available after the execution of a court order forfeiting the lease for breach of a non-rent covenant.

Answer 234

A

Damages

Correct. A landlord is extremely unlikely to be awarded any other remedy by the court.

Answer 235

A

Seven days’ notice served on a commercial tenant that the landlord is going to seize goods from the leasehold property because of a failure to pay rent.

Answer 236

A

Specific performance

Answer 237

A

A promise contained in a lease given by a landlord or a tenant

This is correct, this is the best definition of a leasehold covenant.

Answer 238

A

Old lease governed by the old system of rules

Correct. The lease was entered into prior to 1 January 1996. It is therefore an ‘old lease’ and is governed by the old rules, not the LTA 1995. Though, as you will see, the LTA 1995 has some provisions that apply retrospectively to both old and new leases.

Answer 239

A

The landlord and the tenant

This is correct. Between the original landlord and original tenant there is a contractual relationship ie privity of contract exists here.

Answer 240

A

The landlord and the tenant have privity of contract and privity of estate.

Correct. The original landlord and tenant have privity of contract. As the parties are the current landlord and tenant, they also have privity of estate.

Answer 241

A

1 January 1996.

Correct. The LTA 1995 applies to leases granted on or after 1 January 1996. We describe these leases as “new leases”.

Answer 242

A

The tenant is liable for the entire term of the lease.

Correct. The original tenant has privity of contract and is liable for its assignees for the entire term of the lease as per the Law of Property Act 1925, s 79.

Answer 243

A

The landlord is liable for the entire term of the lease.

Correct. The original landlord has privity of contract and is liable for its assignees for the entire term of the lease as per the Law of Property Act 1925, s 79.

Answer 244

A

The original tenant, Assignee 2, Assignee 3.

Correct. The original tenant is liable as it remains so for the entire term; Assignee 2 is liable for the entire term as it has made a direct covenant to that effect with the landlord; Assignee 3 has privity of estate with the landlord and is liable as the current tenant. Assignee 1 has neither privity of contract nor privity of estate.

Answer 245

A

The tenant was automatically released from liability upon assignment of the lease to the assignee.

Correct. This is because of the operation of the LTA 1995, s 5.

Answer 246

A

The landlord was released from liability if the tenant granted him a release.

Correct. This is because of the LTA 1995, sections 6 and 8. Unlike the tenant, the landlord is not automatically released under the LTA 1995.

Answer 247

A

The tenant is liable for any covenant that it breached.

Correct. This is because of the operation of the LTA 1995, s 24(1).

Answer 248

A

The provisions of the Landlord and Tenant (Covenants) Act 1995 apply to leases granted on or after 1 January 1996. The retrospective provisions apply to all leases whenever granted.

Correct. This is because of the LTA 1995, section 1.

Answer 249

A

The reversioner may sue the assignee only for the breaches of covenant.

Correct. The effect of the LTA 1995, s 3 is that the benefit of the covenants passes automatically to the reversioner and the burden of the tenant’s covenants passes automatically to the assignee.

Answer 250

A

The landlord should sue Assignee 1 for damages. Assignee 1 may try to recoup his losses via an express or common law indemnity from Assignee 2.

Correct. The tenant is no longer liable as the authorised guarantee agreement falls away under the LTA 1995, s 16(4) when Assignee 1 assigns the lease. Assignee 1 is liable under its authorised guarantee agreement and could try to recoup any losses from Assignee 2 (if possible) if there is an express indemnity between them or via the common law rule from Moule v Garrett (1872).

“running of leasehold covenants”

incorrect
The landlord should sue the tenant or Assignee 1 for damages. The tenant may try to recoup his losses via an express indemnity from Assignee 1 or via a common law indemnity from Assignee 2. Assignee 1 may try to recoup his losses via an express or common law indemnity from Assignee 2.

Incorrect. Review the material on authorised guarantee agreements. The tenant is no longer liable under the authorised guarantee agreement. If Assignee 1 were sued under its authorised guarantee agreement, it could try to recoup any losses from Assignee 2 (if possible) if there is an express indemnity between them or via the common law rule from Moule v Garrett (1872).

Answer 251

A

The landlord may sue Assignee 1 or Assignee 2 for the breaches of covenant. The tenant has been released from liability.

Correct. The assignment between Assignee 1 and Assignee 2 is an excluded assignment so Assignee 1 is not released from liability under the LTA 1995, s 11. The tenant was released from liability under the LTA 1995, s 5.

Answer 252

A

The landlord may sue the subtenant for the breach of the user covenant and the tenant for the breach of the decorating covenant.

Correct. The LTA 1995, s 3(5) allows the landlord to sue a subtenant directly for breach of a restrictive covenant. The landlord would have to sue the tenant for the breach of the decorating covenant as this covenant is positive and is also in the headlease (as the sublease contains the same leasehold covenants as the headlease).

Answer 253

A

Assignee 1 or Assignee 2.

Correct. Assignee 2 is liable as the burden of the covenants passed under the LTA 1995, s 3. Assignee 1 is liable for its successor’s breaches as it gave an authorised guarantee agreement to the landlord under the LTA 1995, s 16.

Answer 254

A

The landlord may pursue the tenant, Assignee 1 or Assignee 2 for a remedy for the breaches of covenant.

Correct. The burden of the tenant’s covenants passes to Assignee 2 under the LTA 1995, s 3. Assignee 1 has made an excluded assignment under the LTA 1995, s 11. Assignee 1 is therefore not automatically released from liability under the LTA 1995, s 5. Consequently, the AGA entered into by the tenant cannot fall away because the tenant’s immediate assignee remains liable for the tenant’s covenants (as per the LTA 1995, ss 11(2) and 16(4)).

Answer 255

A

Where there is an absolute or qualified covenant against assignment in the lease and it is a condition of the lease that the outgoing tenant will provide an AGA, a landlord may request an AGA from an outgoing tenant.

Correct. These details are set out in the LTA 1995, s 16(3).

Answer 256

A

The landlord must serve a notice on the former tenant under the LTA 1995, s 17. The former tenant may then apply for an overriding lease to maintain some control over the actions of the current tenant.

Correct. The landlord is suing the former tenant for a ‘fixed charge’ so must serve a notice under the LTA 1995, s 17, and the tenant may then apply for an overriding lease.

Answer 257

A

In writing, contains all the terms and is signed by both parties

A land contact must comply with LP(MP)A 1989, s.2. The contract must be in writing, all the terms must be included and the contract must be signed by both parties. There is no requirement that the signatures of both parties be witnessed, unlike the requirements for a deed.

Answer 258

A

True because s 2(1) permits all the terms to be in two documents provided they are identical

The statement is true. The agreed land contract can be engrossed in duplicate, with the parties signing different copies of the same document, which are then physically swapped. This is standard conveyancing practice to save time and is known as ‘exchange of contracts’.

Answer 259

A

A five-year lease

LP(MP)A 1989, s 2 applies to all land contracts, not just a contract for the sale of land. If the subject matter of the agreement is land, s.2 will apply. A lease is not, however, a contract. It is the grant of an estate in land, which must be by deed.

Answer 260

A

The prospective tenant need not enter into the lease because the landlord has not complied with plans and scheme of building works, which have been included in the sale agreement by incorporation

The two parties have entered into an agreement for lease, which is a contract to enter into a lease in the future. Such a contract must comply with LP(MP)A 1989, s.2, which it does. The contract is in writing, has been signed by both parties and contains all the agreed terms, including the building works and plans, which have been included by incorporation. This is permitted by LP(MP)A 1989, s 2(2), which provides the contractual terms may be incorporated into the contractual document either by being set out in the document or by referring to some other document. The landlord has not complied with the terms by undertaking the works. Therefore, the other party need not enter into the lease because it is conditional upon these being completed.

Answer 261

A

The agreement has not been extended because the variation does not comply with the necessary statutory formalities

The agreement is a right of pre-emption, which is a type of land contract. In order for a variation to be valid, it must also comply with LP(MP)A 1989, s.2. This was made clear in the case of McCausland v Duncan Lawrie Ltd [1997] 1 WLR 38, where the parties tried to agree an oral variation to the agreed completion date. This variation was held to be void and the court stated that whenever a material term in land contract is varied, that variation must comply with LP(MP)A 1989, s.2. The term of the pre-emption agreement is no doubt a material term.

Answer 262

A

The buyer should ask for the court for an order of specific performance which would compel the seller to comply with the contract

As the contract for sale grants the buyer a proprietary equitable interest in the land, the buyer is entitled to damages as a right for breach. Given the buyer would like to proceed with the purchase, the buyer should ask the court for an order of specific performance. This is an order which, if granted, would compel the seller to comply with the terms of the contract and sell the land to the buyer. This, like an injunction, is an equitable remedy, which means it will only be granted at the discretion of the court.

Answer 263

A

The buyer should ask for the court for an order of specific performance which would compel the seller to comply with the contract

As the contract for sale grants the buyer a proprietary equitable interest in the land, the buyer is entitled to damages as a right for breach. Given the buyer would like to proceed with the purchase, the buyer should ask the court for an order of specific performance. This is an order which, if granted, would compel the seller to comply with the terms of the contract and sell the land to the buyer. This, like an injunction, is an equitable remedy, which means it will only be granted at the discretion of the court.

Answer 264

A

If you are selling a piece of land, you need to know what you are entitled to take and what must be left for the buyer as everything classed as land passes to the buyer under LPA 1925, s 62.

This is correct. This is particularly relevant in the context of fixtures/fittings. If an item is a fixture, it is part of the land and must therefore be left for the buyer. However, if something is a fitting, the seller can take it.

Answer 265

A

The clause was upheld because once the loan was repaid, the borrower would get back what he had mortgaged and during the mortgage he had had the benefit of a low interest rate.

Correct. The borrower got back an unencumbered freehold which was exactly what he had mortgaged. The advantageous interest rate justified the lock-in.

Answer 266

A

On the date set out in the mortgage deed.

Correct. The legal right exists for one day, and is the date set out in the mortgage deed. Review the materials on the equitable right to redeem.

Answer 267

A

When some of the interest is unpaid for two months or more.

Correct. LPA 1925, s 103(ii) states that some interest must be outstanding for two months. It does not mean that two months’ worth of arrears is owed! The amount can be very small.

Answer 268

A

The first loan is redeemed first, then the second loan with any surplus being paid to the borrower.

Correct. The first lender takes priority and is paid first, even though the second lender actually sold. The surplus proceeds are held in trust of the first borrower.

Answer 269

A

The lender has an unfettered discretion as to when to sell and need not delay.

Correct. This was decided in Silven Properties Limited v Royal Bank of Scotland plc.

Answer 270

A

The lender cannot be expected to achieve the perfect sale price, but the price must be in the correct bracket.

Correct. This was the decision in Michael v Miller.

Answer 271

A

As soon as one monthly instalment is unpaid.

Correct
Correct. LPA 1925, s 101(1) says that the right arises when the mortgage money ‘has become due’. In an interest-only mortgage, that will happen on the legal redemption date; in a capital and interest repayment mortgage, that happens when any payment of capital has been missed.

Answer 272

A

NO

Although the right has been exercised for over 20 years, a prescriptive right can only be created as between two freehold owners.

Answer 273

A

Law of Property Act 1925, s 1(2)(a).

This is correct. This section states that an easement granted or reserved for the equivalent of a term of years absolute is capable of being a legal interest in land.

Answer 274

A

a quasi-easement

This is correct. A quasi-easement is a benefit which could be enjoyed as an easement should the different parts of the owner’s land ever be enjoyed by separate owners.

Answer 275

A

implied reservation

This is correct. The right is not in writing and must therefore be implied. It is a reservation as it is a right which C has kept back for himself out of the land sold to D.

Answer 276

A

incorrect
S 62 upgrades permissions to full legal easement when there is a transaction by deed.

This is not correct. This is a statement of the way in which the section can operate to imply easements into a document. It is not a statement of the ordinary operation of that section. Re-read Law of Property Act 1925, s 62.

Answer 277

A

S 62 passes the benefit of existing easements to a new owner of the dominant land.

This is correct. The section operates as a word-saving section and makes it clear that any existing rights and easements will form part of the dominant land and will automatically pass to the new owner on a sale.

Answer 278

A

Substantive registration: Land Registration Act 2002, s 27(2)(d).

This is correct. An express legal easement must be substantively registered in order to be legal. Once substantively registered it will appear in the charges register of the servient land and will automatically bind a new owner of that land.

incorrect
Schedule 3 paragraph 3 relates to enforceability of implied legal easements. Revise the rules on enforceability of expressly created legal easements.

Answer 279

A

No registration is necessary: Land Registration Act 2002, Schedule 3, paragraph 3.

This is correct. Implied legal easements operate as overriding interest provided that one of the conditions in Land Registration Act 2002, Schedule 3, paragraph 3 is met.

Answer 280

A

The easement is not binding on a purchaser for value of the servient land: Land Registration Act 2002, s 29(1).

This is correct. Buyers and lenders are purchasers for value, and will take the land free of an unprotected equitable easement, although it will still bind a volunteer.

Answer 281

A

6.1

Registrable dispositions

This is correct. Registrable dispositions are transactions which must be completed by registration. This includes creation of certain interests in land.

Answer 282

A

An implied periodic tenancy of one year

The lease does not have a certain term. A term ‘for as long as the tenant is trading’ will fail for lack of certainty, we do not know how long this will be. However, because the tenant has moved in and is paying an annual rent, a periodic tenancy of one year will be implied.

There is no certain term so there is no lease on the facts

This is incorrect. Consider the case of Prudential Assurance Co Ltd v London Residuary Body [1992] 2 A.C. 386 and how it might apply to this scenario.

Answer 283

A

False, the courts will always looks at the substance of a sharing clause

Correct
The courts will look at the substance of a sharing clause. Although such a clause does at first sight indicate there is no exclusive possession, because the occupier cannot exclude whoever the landlord can introduce, the courts will look at the substance of the arrangement and the reality of it, whether the clause is in fact a sham. If it is a sham, such a clause will not defeat exclusive possession.

Answer 284

A

Exclusive possession means the occupier is able to exclude everyone from the flat including the landlord

For there to be a lease the occupier must have exclusive possession, which is correctly defined by this statement.

Answer 285

A

There could be exclusive possession if the clause has never been exercised

The label of the document is inconclusive, the court will look at the substance of the agreement rather than the label. This means the court will also look at the reality of whether the clause has been exercised, or whether it is a sham clause. If the clause has never been exercised then this would indicate it is a sham clause and so there could still be exclusive possession.

Answer 286

A

No formalities are required, and the lease does not need to be registered at the Land Registry

This lease would fall within the exception for short leases of three years or fewer (LPA 1925, s 54(2)) and need not therefore be created by deed or with any formality at all. The lease is at a market rent so the conditions in the section appear to be satisfied. There is no requirement to register legal leases of seven years or fewer. Such a lease will be an overriding interest under LRA 2002, sch 3 para 1.

Answer 287

A

A deed must be used but it need not be registered at the Land Registry

The lease must be created by deed (LPA 1925, s 52). There is no requirement to register legal leases of seven years or fewer. Such a lease will be an overriding interest under LRA 2002, sch 3 para 1.

Answer 288

A

A landlord and tenant agree to the grant of a lease at the advertised market rent of £5000 per annum. The tenant moves in and pays the rent by monthly instalments.

This is a yearly periodic tenancy that has been created on the facts – the tenant has moved in and is paying an annual rent. The term is regarded as being of one year. There is no indication that any premium was payable by the tenant and a market rent is being paid. The conditions in LPA 1925, s 54(2) have therefore been satisfied.

Answer 289

A

Fixed term legal lease

Implied annual periodic tenancy (legal lease)

No valid lease has been created

Express monthly periodic tenancy (legal lease)

Fixed term equitable lease

Answer 290

A

Fixed term legal lease

Implied annual periodic tenancy (legal lease)

No valid lease has been created

Express monthly periodic tenancy (legal lease)

Fixed term equitable lease

Answer 291

A

Yes, as the seven-year lease does not need to be registered and is an overriding interest (LRA 2002 , schedule 3 para 1)

A lease of seven years or fewer must be created by deed, but need not be registered. It is binding on a new freehold owner as an overriding interest.

Answer 292

A

Fixed term legal lease

Implied annual periodic tenancy (legal lease)

Fixed term equitable lease

Express monthly periodic tenancy (legal lease)

No valid lease has been created

Answer 293

A

Creation of a restrictive covenant

This is correct. A restrictive covenant is not an interest which must be registered as part of the process of creating it.

Answer 294

A

Land Registration Act 2002, s29(2)

Answer 295

A

A purchaser for valuable consideration will take land free of any prior registrable disposition which have not actually been registered.

Answer 296

A

Beneficial interest under a trust

This is correct. Land Registration Act 2002, s33 specifically states trust interests cannot be protected by notice.

Answer 297

A

A is bound by the covenant because Land Registration Act 2002, s28 applies.

This is correct. A is a volunteer, or donee, which means that A has not paid for the land. Volunteers are always bound by pre-existing interests, irrespective of whether they have been protected or not.

Answer 298

A

A restriction imposes conditions which must be complied with before a disposition of land can be registered.

This is correct. A restriction does not make an interest binding as a new owner, it simply tells that person what to do in order to be able to complete the transaction.

Answer 299

A

Beneficial interest under a trust

This is correct. This type of interest is the only type of interest which can be overreached. This is because it is not an interest (unlike easements and covenants) which is intended to affect one piece of land indefinitely.

Answer 300

A

The purchaser must pay the purchase money to at least two trustees.

This is correct. LPA 1925, s2, s27 state that capital money must be paid to at least two trustees for overreaching to take effect.

Answer 301

A

The interest remains in the land, but will not not necessarily be binding

This is correct. If an interest is not overreached, it remains in the land. It is not automatically binding on a purchaser though, it will depend if the holder of the interest is in ‘actual occupation’.

Answer 302

A

Both registered and unregistered land

This is correct. You must keep the two systems of land ownership distinct. The rules that relate to each system do not relate to the other, they are completely separate systems. However, overreaching applies to a beneficial interest behind a trust (rather than one particular system.) The doctrine therefore applies to trusts of land over both registered and unregistered land.

Answer 303

A

City of London Building Society v Flegg.

This is correct. As the mortgage money lent by the building society was paid to the Maxwell – Browns as legal trustees, the Fleggs’ interests were overreached and converted its interests in money.

Answer 304

A

An overriding interest is an interest which will bind a purchaser of the burdened land even though it does not appear on the register of title.

This is correct. An overriding interest does not have to be registered in order to be binding.

Answer 305

A

A legal lease granted for a term of five years.

Correct. Legal leases for a term of seven years or less do not need to be protected by registration in order to be enforceable.

Answer 306

A

A restrictive covenant.

Correct. To be overriding interest under para 2, the holder must be in actual occupation of the burdened land. This is not the case for the holder of the benefit of a covenant.

Answer 307

A

Link Lending v Bustard

Correct. Temporary absence did not defeat actual occupation. This case is good illustration of how courts consider each case on its own facts.

Answer 308

A

A can enforce it against C as it is an overriding interest under LRA 2002, Schedule 3, paragraph 3.

Correct. Schedule 3, para 3 states that implied legal easements can be overriding interests provided that they are obvious from a reasonable inspection of the burdened land (which this probably is) OR that they have been exercised within the 12 months immediately prior to the sale (which this definitely has been).

Answer 309

A

Epitome of title

As the seller may have lots of old title deeds of varying degrees of usefulness relating to the property, s/he must only select those which contain relevant detail about the property and then make a copy of these documents. This bundle of relevant copy documents is called an epitome of title. On a sale, the seller is required to show the epitome of title to the buyer. This is called deducing title.

Answer 310

A

Legal interests

Legal interests will ‘bind the whole world.’ This is the case even if the new owner does not know about the interest prior to the purchase and there is no evidence of it.

Answer 311

A

Equitable interests created pre-1926

Equitable interests created prior to 1926 remain subject to the doctrine of notice, as do equitable interests under a trust that have not been overreached. For this reason, the doctrine of notice has fairly limited application nowadays.

Answer 312

A

Equitable interests created post-1926

The majority of equitable interests created after 1926 should be protected by the entry of a Land Charge against the name of the land owner at the time the interest is created. This was intended to be a ‘stop-gap’ system until all land became registered in England and Wales.

Answer 313

A

No, because they are not a purchaser for value

This is correct. Equity’s darling is a bona fide purchaser for value of a legal estate without notice. Someone who is gifted the land (or inherits it) could never be equity’s darling because they are never a ‘purchaser for value.’

Answer 314

A

The name of the land owner at the time the interest is created

The land charge must be entered against the correct name(s) of the estate owner(s) at the time of the creation of the land charge: LCA 1972, s 3(1).

Answer 315

A

Puisne mortgage

A second legal mortgage is the only type of legal interest that can be protected by way of a Land Charge. It is the exception to the rule that Land Charges protect equitable interests only.

Answer 316

A

The buyer could still be bound by the equitable easement because the search was not against the correct name

The land charge must be entered against the correct name(s) of the estate owner(s) at the time of the creation of the land charge. This is the version of the name as it appears in the title deeds ie Peter Wells. The buyer has searched against the wrong name on the facts, and therefore could still be bound by the easement if it has been entered as a Land Charge against the name Peter Wells.

Answer 317

A

The new owner will be bound by the estate contract because it is not a purchaser for value

The agreement for lease, as an estate contract, should be protected by a Class C (iv) Land Charge under the LCA 1972. Failure to do this means that it will not be binding on a purchaser for value. However, the new owner is not a purchaser for value, it has inherited the freehold estate. For this reason, the new owner will be bound by the equitable interest. Notice is irrelevant as the estate contract was created after 1926.

Answer 318

A

Interest behind a trust that has not been overreached

An equitable interest behind a trust cannot be protected by way of a Land Charge. If such an interest has not been overreached, the interest will be binding unless the purchaser is ‘equity’s darling.’

Answer 319

A

A bona fide purchaser for value of a legal estate without notice

‘Equity’s Darling’ is a ‘bona fide purchaser for value of a legal estate without notice’ of the equitable interest.

Answer 320

A

A good faith buyer who pays monetary consideration for a terms of years absolute and who instructs solicitors and inspects the land but finds no evidence of the equitable interest.

This person is Equity’s Darling. They are a good faith purchaser for value of a legal estate without notice. All elements are satisfied.

Answer 321

A

A buyer will be bound by those equitable interests it ought reasonably to have known about

LPA 1925, s 199(1)(ii)(a) requires a purchaser to act as a prudent person. A purchaser cannot attempt to avoid being bound by equitable interests by shutting its eyes and ears and thus not having actual notice. A purchaser will be fixed with constructive notice of an interest if it fails to pursue a line of enquiry which ought reasonably to have been made

Answer 322

A

No, it cannot be revived so as to bind a subsequent buyer

Correct
An equitable interest is void against such a purchaser or someone claiming through them. It follows that once an equitable interest becomes void for want of notice, it cannot be revived so as to bind a subsequent buyer who does have notice of the equitable right.

Answer 323

A

When the tenant sells the remainder of their lease to another party.

Correct. This is very common in practice, especially where the lease is longer than 5-10 years.

Answer 324

A

A valid deed.

Correct. LPA 1925, s 52 requires a deed to be used to transfer a legal estate in land. This applies even if the lease has been created under LPA 1925, s 54(2) (i.e. with no formalities).

Answer 325

A

A landlord’s consent is unreasonably withheld if the refusal is designed to achieve a collateral purpose unconnected with the landlord and tenant relationship, and the burden of proving that a refusal of consent is reasonable is on the landlord.

Answer 326

A

The landlord must give written consent within 28 days and is entitled to request additional information to enable them to make a decision. The landlord must provide written reasons if they refuse consent.

Correct. This is as per Landlord and Tenant Act 1988, s 1(6).

Answer 327

A

The tenant is liable for the entire term of the lease.

Correct. The original tenant has privity of contract and is liable for its assignees for the entire term of the lease as per the Law of Property Act 1925, s 79.

Answer 328

A

The landlord is liable for the entire term of the lease.

Correct. The original landlord has privity of contract and is liable for its assignees for the entire term of the lease as per the Law of Property Act 1925, s 79.

Answer 329

A

The landlord and the tenant have privity of contract and privity of estate.

Correct. The original landlord and tenant have privity of contract. As the parties are the current landlord and tenant, they also have privity of estate.

Answer 330

A

The landlord and the tenant have privity of contract.

Correct. The original landlord and the original tenant of an old lease have privity of contract.

Answer 331

A

The original tenant, Assignee 2, Assignee 3.

Correct
Correct. The original tenant is liable as it remains so for the entire term; Assignee 2 is liable for the entire term as it has made a direct covenant to that effect with the landlord; Assignee 3 has privity of estate with the landlord and is liable as the current tenant. Assignee 1 has neither privity of contract nor privity of estate.

Answer 332

A

A restrictive covenant

This is correct. A restrictive covenant is a promise not to do something in respect of the land. The buyer enters into a covenant in the transfer deed by promising to only use the land for a single dwelling house and for no commercial or business use. This a common restrictive covenant.

Answer 333

A

Your client is likely to be successful as the shop owner is trespassing into your client’s lower airspace

This is correct. A freehold estate includes the ‘lower’ airspace. This is defined in Bernstein v Skyviews [1978] as the height which is necessary for the ordinary use and enjoyment of the land. The ordinary use and enjoyment of this land would include the peaceful enjoyment of the roof terrace.

Answer 334

A

The summer house is a moveable structure.

This is correct. After considering the degree of annexation and purpose of annexation tests, if the summer house can be moved or removed without being damaged or destroyed then a court is likely to hold it is a chattel as per the case of Elitestone v Morris (1997).

Answer 335

A

The land is a leasehold estate, the borrower is a residential tenant and the loan is to pay for the extension of the leasehold term.

This is correct and the facts are akin to the case of Cityland v Dabrah (1968). As with this case, if the property is a leasehold and the borrower is a residential tenant who needs the money to extend the length of the lease, there is a risk that the lender could take advantage of the borrower’s circumstances and impose a higher interest rate. The borrower is more likely to agree to unconscionable terms to ensure the loan is made.

Answer 336

A

Term (i) is an enforceable collateral advantage but term (ii) is inconsistent with the right to redeem the mortgage.

This is correct.

Term (i) is a collateral advantage but as it expires at the end of the mortgage term and as long as it is not onerous or in the nature of a penalty, it will be upheld by the court as in the case of Biggs v Hoddinott.

Term (ii) gives the lender the option to purchase the freehold at any time during the term and is likely to be struck out as in the case of Samuel v Jarrah Timber and Wood Paving Corporation Limited.
incorrect

Term (i) and term (ii) are both unenforceable terms and likely to be struck out by a court.

Your answer is incorrect. Although one of the terms is likely to be unenforceable, the other isn’t.

Revisit the Equity of Redemption (2) element. In particular, please review the material on collateral advantages and the case of Biggs v Hoddinott in relation to term (i). Please review the material on option agreements and the case of Samuel v Jarrah Timber and Wood Paving Corporation Limited in relation to term (ii).

Answer 337

A

The lender would not be put on enquiry of undue influence because the loan is for the joint benefit of the couple

This is correct. The lender would not be put on enquiry of undue influence because the loan is for the joint benefit of the couple. In CIBC Mortgages plc v Pitt the House of Lords confirmed that a lender would not be put on notice that there is a risk of undue influence where a transaction is ostensibly for a couple’s joint benefit, as it is on the facts here.

Answer 338

A

The borrower has granted an equitable mortgage. Equity will recognise the ‘failed legal mortgage’ as a ‘contract to grant a legal mortgage’.

This is correct. Although a valid deed has been created on the facts - the document complies with LP(MP)A 1989, s 1 - it has not been registered by the lender. No valid legal mortgage has therefore been created on the facts. Equity will, however, recognise this an equitable mortgage in the circumstances. The document complies with LP(MP)A 1989, s 2 and equity will therefore recognise it as a ‘contract to grant a legal mortgage’. An equitable mortgage does not need to be registered to be validly created.

Answer 339

A

The lender should apply for a court order to obtain possession and then sell the property. However, the mortgagor may apply to have the possession order postponed.

This is correct and is the best answer. It is advisable for the lender to apply for an order for possession, rather than exercising self-help and it is true that the mortgagor can apply to have the possession order postponed under section 36 Administration of Justice Act 1970. The other options are less correct because possession through self-help is rarely if ever advisable with regard to residential property, the Administration of Justice Act 1970 would apply here as the mortgaged property is a dwelling, and the facts indicate that the power of sale has arisen and is exercisable (in addition to the fact that it would not make sense to appoint a receiver here).

Answer 340

A

The lender can sell the property as the power of sale has arisen and has become exercisable on the facts

This is correct: if there is no express power of sale in a mortgage deed (as here) then the statutory provisions in LPA 1925 apply and s 101 will give the lender such a right in a legal mortgage.

The right has arisen as one instalment of capital became due as soon as one payment had been missed: Payne v Cardiff; and the right is exercisable as some interest has been in arrears for two months: LPA 1925, s 103(ii).

As the right has become exercisable due to the missed interest repayments, there is therefore no need for the lender to serve a 3 month written warning/notice of the sale. The legal date for redemption, which is the earliest date on which the borrower can redeem the mortgage, has nothing to do with the lender’s right to sell.

Answer 341

A

The agreement does not create an interest in land

This is correct. Although the parties are trying to create a mortgage, the formalities for both a legal and equitable mortgage have not been complied with.

There is no valid deed, it document has only be signed by the lender. The deed would need to be signed by the mortgagor - the company - on the facts (LP(MP)A 1989, s 1). In order to be a recognised by equity as an equitable mortgage ie be seen as a ‘contract to grant a legal mortgage’ the agreement would need to be signed by both parties (LP(MP)A 1989, s 2), which it hasn’t been on the facts. The agreement has not been signed by the borrower at all, so no interest has been created.

incorrect
Equity will recognise the agreement as an ‘equitable mortgage’

This is incorrect. Equity will only recognise a failed/defective legal mortgage as an ‘equitable mortgage’ if the agreement complies with LP(MP)A 1989, s 2. Revisit your understanding of the requirements of s 2 and make sure you understand why, on the facts, the agreement will not comply with it.

Answer 342

A

The lender should apply for a court order to obtain possession and then sell the property. However, the mortgagor may apply to have the possession order postponed.

This is correct and is the best answer. It is advisable for the lender to apply for an order for possession, rather than exercising self-help and it is true that the mortgagor can apply to have the possession order postponed under section 36 Administration of Justice Act 1970. The other options are less correct because possession through self-help is rarely if ever advisable with regard to residential property, the Administration of Justice Act 1970 would apply here as the mortgaged property is a dwelling, and the facts indicate that the power of sale has arisen and is exercisable (in addition to the fact that it would not make sense to appoint a receiver here).

incorrect
The lender should take possession through self-help, rather than applying for a court order, and then sell the property.

This is incorrect. Self-help could expose the lender to criminal liability under the Criminal Law Act 1977 because the property is not vacant. Although a court order is not always necessary, it is almost always advisable – especially when the mortgaged property is residential or otherwise occupied.

Please revisit your understanding of the rights of the lender, paying particular attention to the lender’s rights to possess and sell.

Answer 343

A

The right is not capable of being an easement because the servient land owner is not left with any reasonable use of the shed

This is correct. The right is not capable of being an easement because it grants exclusive possession to the dominant land owner. The tenant is using all of the available space in the shed so the landowner cannot make any reasonable use of it (Batchelor v Marlow [2003] 1 WLR 764). In addition, the landowner does not ‘retain possession or control’ of the shed (the test suggested by Moncrieff v Jamieson [2007] UKHL 42) as the tenant locks the shed, which the landowner does not have a key for.

In order for a right to be capable of being an easement it must satisfy the requirements established in Re Ellenborough Park [1955] EWCA Civ. If the right does not satisfy any of these requirements, it is not capable of being an easement and will be merely a personal permission (a licence) rather than a proprietary right in the land, which an easement it. Even if a right satisfies the requirements of an easement laid down in Re Ellenborough Park, the right can be defeated (i.e. will not be an easement) if it requires payment by the servient land owner, grants exclusive possession to the dominant land owner or requires permission from the servient land owner in order to be exercised. If a right is capable of being an easement then you then need to consider if it has been acquired (expressly or impliedly) as an easement on the facts.

Answer 344

A

The tenant has acquired an easement impliedly under s.62 of the Law of Property Act 1925

This is correct. the tenant has acquired an easement impliedly under s.62 of the Law of Property Act 1925. On the grant of the second 5 year lease, the informal permission to use the garden is upgraded to an easement and implied into this lease. The facts are similar to Wright v Macadam [1949] 2 KB 744, which demonstrates this mode of acquisition.

An easement can be acquired expressly or impliedly. You should consider first if there has been express acquisition – is the easement written down and does it comply with the necessary formalities? If not, consider if the circumstances mean the easement could have been acquired impliedly by one of the recognised modes. Certain modes of implied acquisition only apply if it is a grant, rather than a reservation, situation. It is therefore important that you understand not only the different modes of acquisition, but also the distinction between reservation and grant.

Answer 345

A

The woman cannot claim an easement of light as there is no defined aperture in a garden

This is correct. A right to light is one of a few recognised negative easements - it is not a ‘new’ negative easement, which the court will not recognise.

However, there is no general right to light. A right to light is an easement that gives a landowner the right to receive light through defined apertures in buildings or on their land. There is not a defined aperture in the woman’s garden to through which the right to light could be claimed on the facts, the women is just trying to claim a general right.

Answer 346

A

The tenant can park their car by reason of an implied equitable easement.

This is the correct answer. Where an estate is transferred or granted to a person for a particular purpose, and that purpose can only be realised if the transferee or grantee can exercise an easement over land retained by the transferor or grantor, that easement will be implied by reason of common intention: Wong v Beaumont [1965] and Donovan v Rana [2014] EWCA Civ 99.

Since the tenant can only use the southern plot for the specified purpose if it is able to park on the northern plot, an easement of parking will be implied.

Implied easements derive their legal or equitable status from the transaction into which they are implied. Since the tenant acquired an equitable lease (arising by reason of the specifically enforceable contract to grant a lease: R v Tower Hamlets LBC ex parte Von Goetz [1999] QB 1019), any easements implied into that lease would be equitable.

Answer 347

A

The farmer has not acquired an easement.

This is correct. This is an attempted reservation. There is no mention of the right to use the drains in the lease, so it cannot be an express easement. The only methods of implied acquisition available for reservations are: necessity and common intention. Necessity will not apply - necessity is only applicable to rights of way where there is no other means of access to the land. The courts will only allow an easement of common intention in a reservation situation if there is no other possible interpretation of the facts (Peckham v Ellison; Re Webb’s Lease). Here, the farmer can use its retained land without the drainage right and had two opportunities to reserve this right (in the first and second leases) (Yeung v Patel) so the court is unlikely to imply this reservation.

Answer 348

A

incorrect

The benefit has passed by express assignment

This is incorrect. There is no evidence that your client assigned the benefit of the covenant to the new owner. Please revise the rules for passing the benefit of freehold covenants in equity and make sure you can identify which method is the most appropriate for a given set of facts.

Answer 349

A

The burden of the covenant will not pass because the new owner had no notice of the covenant

This is correct. As House 2 is registered land, the man should have protected the covenant by the entry of a notice on the charges register of House 2 (s32 LRA 2002). This did not happen at the time the covenants were entered into. Therefore, the new owner, as a purchaser for valuable consideration of House 2, takes free of the unprotected covenant (s29(1) LRA 2002).

The other answers are incorrect because the covenant is actually overall negative with a positive aspect (following Powell v Hemsley) and it does touch and concern the dominant land since restricting building on your neighbour’s land will protect the view from the dominant land thereby preserving its value, quality etc. It is incorrect to assert that the dominant and servient land are not sufficiently proximate since House 1 and House 2 are adjoining properties. There is also express wording here that shows that the original parties (the man and woman) did intend the burden of this covenant to run with House 2, so it is incorrect to state that the original parties did not intend the burden to run.

Answer 350

A

The covenant can be enforced against the friend because the burden of the covenant will pass under the doctrine of mutual benefit and burden

This is correct. The covenant is likely to pass to the friend under the rule in Halsall v Brizell [1957] as there is a mutual burden (to contribute towards the maintenance costs) and benefit (use of the garage). As per Rhone v Stephens [1994], there is a correlation between the benefit and burden and the benefit and burden as conferred in the same transaction (Davies v Jones [2009]). There is a genuine choice whether to accept the benefit of the right to park (Thamesmead Town Ltd v Allotey (1998)) as the friend could park on the next street instead. This exception to the general rule that the burden will not pass at common law (Austerberry) can therefore be applied on the facts and used by the lawyer to enforce the covenant against the friend.

The rule in Tulk v Moxhay cannot be used to pass the burden of the covenant in equity as the covenant is positive.

Answer 351

A

The covenant is a mixed covenant. It cannot be split and is overall positive.

This is correct. Applying the ‘hand-in-pocket’ test (Haywood v Brunswick Permanent Benefit Building Society [1881] 8 QBD 403), the obligation to paint the windows requires money and time to be spent. The part of the covenant requiring the buyer to ‘only use colours approved by the landowner’ is restrictive and therefore negative - this part of the covenant can be complied with by inaction. The negative element cannot, however, stand alone and therefore Powell v Hemsley [1909] 1 Ch. 680 applies and the covenant is seen as one obligation with a condition attached. The main obligation is positive and the covenant is therefore seen as an overall positive covenant.

Answer 352

A

The tenant will be able to enforce the covenant against the man providing the covenant is deemed to touch and concern the land

Correct
This is the correct answer. Provided that the covenant is deemed to touch and concern the land, this will satisfy the rules for an implied passing of the benefit at common law under P&A Swift Investments v Combined English Stores.

The other conditions of P&A Swift will be satisfied because if there is no express wording showing an intention for the parties to pass the benefit to successors, s78 Law of Property Act 1925 will imply this intention. Further, both the covenantee and their successor will also hold legal estates in land, as the woman owned the freehold and the tenant has a legal lease. Smith & Snipes Hall Farm v River Douglas Catchment Board confirms that different estates are acceptable.

Answer 353

A

The neighbour should protect the right by the entry of a notice on the charges register of the Property.

The neighbour has an inherently equitable easement over registered land- it is an easement for an uncertain term, so can only take effect in equity (s 1(3) LPA 1925). The easement has been properly created in accordance with s 53(1)(a) LPA 1925 and does not need to be registered in order to be validly created.

To bind a purchaser for valuable consideration, this type of easement should be protected by entering a section 32 Land Registration Act 2002 notice on the charges register of the Property.

Answer 354

A

An entry relating to an easement in the property register

This is correct. A right of way would be an easement. You are told the land has benefit of this right, rather than the burden. Interests that benefit a piece of registered land are found in the property register.

Answer 355

A

incorrect
You do not need to do anything as there are two sellers so your client will not be bound by any interest due to overreaching.

This is incorrect. Although are are told there are two sellers, it is clear from the facts that only one of the sellers is actually registered as the legal owner (the registered proprietor). Therefore, unless the man is appointed as a trustee, the purchase monies would only go to the woman.

Revisit your understanding of interests in trusts of land and the doctrine of overreaching.

Answer 356

A

Yes, your client is bound under the normal rules of priority

This is correct. Your client is not a purchaser for value, they are a donee - they were gifted the land. Therefore, they will be bound by the option to purchase, which is a form of estate contract.

The estate contract is an equitable interest in the land. It has been validly created as it complies with LP(MP)A 1989, s 2 - it is in writing and signed by both parties (the neighbour and the parent) and there is nothing to indicate that all the terms are not contained. An estate contract over registered land should be protected by a notice in the charges register of the burdened land (LRA 2002, s 32) otherwise it will not bind a purchaser for value. However, your client is not a purchaser for value on the fact so will still be bound (LRA 2002, s 28) under the normal rules of priority.

Answer 357

A

incorrect
No, your client will not be bound because the person is not in actual occupation of the land

This is incorrect. Although physically absent from the land during the sale, the person could still be in ‘actual occupation’. Revisit your understanding of ‘overriding interests’, with particular attention to the cases of Link Lending v Bustard and Chhockar v Chhockar

Answer 358

A

The interest must be protected by a land charge to bind future purchasers for valuable consideration.

This is correct. You are told on the facts the land is unregistered. This is a second legal mortgage - a puisne mortgage - and must be protected by a Class C(i) land charge to bind a purchaser for valuable consideration of any interest in the land. See s2(4)(i) and s4(5) Land Charges Act 1972.

If this were a first legal mortgage over unregistered land, it would be a trigger for first registration of the land (s 4 LRA 2002).

If this second legal mortgage were granted over registered land, it would need to be substantially registered in order to take effect as a legal interest.

Answer 359

A

The solicitor will need to review a search carried out of the Land Charges Register, and investigate the possibility of interests that are subject to the doctrine of notice.

This is the correct answer. Title to unregistered land has no register at the Land Registry to review. As such, when investigating unregistered land, solicitors must investigate the possibility of any Land Charges that are registered on the Land Charges Register and will bind the land, but also consider whether there are any other interests (predominantly pre-1926 interests or beneficial interests under a trust that have not been overreached) that could also bind the property subject to the doctrine of notice.

Answer 360

A

incorrect

Your client is bound by the interest because it remains in the land and your client had actual notice of it.

This is incorrect. Although it is correct to say that your client has ‘actual notice’ you need to revisit you understanding of overreaching, and its impact.

Answer 361

A

The right of way will be binding under the rule ‘legal interests bind the world’

This is correct. A legal interest over unregistered land will be binding under the principle ‘legal interests bind the world’. We know the right of way is a legal easement because it is granted for term equivalent to a freehold or leasehold estate (20 years - a certain term) and is granted by way of valid deed.

If the easement was for an uncertain term or was granted by way of a failed deed, it could be equitable. In this situation, it would need to be protected by a land charge against the name of the grantor.

Answer 362

A

The bank is bound by the interest because it had imputed notice of it

This is correct. The surveyor has actual notice, and the surveyor is the bank’s agent. The bank will be bound by the actual or constructive notice of their agents, which is imputed notice. Overreaching has not occurred because the bank only paid the loan monies to the sole legal owner. It is therefore bound by the partner’s equitable interest because it is not equity’s darling.

Answer 363

A

incorrrect
The first four of the five friends named in the transfer deed will hold the property as joint tenants

This is incorrect. The number of owners is irrelevant for the purposes of equity. Whilst there may be a limit on the number of joint tenants that can hold the legal title, the same does not apply in equity. This is not to say there may never be a situation where only four of the five friends could hold the equitable title as joint tenant. For example, if the property was initially held as joint tenants and one of the friends dies or severs their interest. This is not applicable here. Revisit your understanding of when a rebuttable presumption of a tenancy in common will arise and the case of Bull v Bull [1955] and Lake v Craddock (1732).

Answer 364

A

incorrect
The partner’s equitable interest has not been severed as the contract has not been signed by both parties.

This answer is incorrect as the contract does not need to be signed by both parties in order for the mortgage to be created and the interest severed. Check your understanding of equitable mortgages and the formalities for creation focusing in particular on s.53(1)(c) LPA 1925.

Answer 365

A

Severance has not occurred because the notice does not show a desire to sever with immediate effect.

This is correct. The notice in writing must demonstrate an unequivocal and immediate intention to sever - Harris v Goddard [1983] 1 WLR 1203. Here the desire to sever does not show an intention to bring about the result immediately, it says for the property to be sold in a year’s time. The letter would otherwise comply with the requirements of a ‘notice in writing’ - it is in writing, addressed to the other equitable joint tenants and correctly served on them at their place of abode. It does not matter that the letter is unsigned (Re Draper’s Conveyance [1969]).

Answer 366

A

B and D hold 75% as equitable joint tenants. C holds 25% as a tenant in common.

This is correct. A died as an equitable joint tenant, and therefore the right of survivorship operated and A’s interest in the property passed to the remaining joint tenants, B and D.

C’s interest had already been severed at this point. When C was declared bankrupt this automatically severed C’s interest, which vested in C’s trustee in bankruptcy. On severance, C got an equal share, which at the time was 25% (Goodman v Gallant). The subsequent death of A had no effect on this.

Answer 367

A

E’s application for an order for sale is likely to be refused by the court because C and D oppose the sale and the combined value of their interests is greater than E’s.

This is correct. TLATA 1996, s 15(3) allows the court to take into account the circumstances and wishes of the beneficiaries aged 18 and over and give effect to the wishes of the majority by value. The interests of G will not weigh heavily as the payments are not in arrears and G will continue to be paid monthly instalments.

Answer 368

A

E and G hold the legal title and equitable titles as joint tenants

This is correct. The legal joint tenancy cannot be severed (Law of Property Act 1925, s 36(2), and E F and H have not reached a mutual agreement to sever the equitable joint tenancy: Burgess v Rawnsley as they had not reached the point where all joint tenants regarded one person’s share as separate. Their further deliberations need not necessarily involve severance. As F died as a legal and equitable joint tenant, survivorship applies meaning that the interest accrues to the survivors, E and G.

Answer 369

A

A, B and E

This is correct. Originally, the legal owners were A, B, D and E as joint tenants. C could not hold legal title as legal owners must be aged 18 or over. On D’s death, the rule of survivorship applies and the joint tenancy continues to be held by the survivors, A, B and E.

Answer 370

A

A, B and E

This is correct. Originally, the legal owners were A, B, D and E as joint tenants. C could not hold legal title as legal owners must be aged 18 or over. On D’s death, the rule of survivorship applies and the joint tenancy continues to be held by the survivors, A, B and E.

Answer 371

A

incorrect
The occupier has an equitable periodic tenancy

Your answer is incorrect. A periodic tenancy is implied by the common law, not equity. Please review the rules on formalities for legal and equitable leases.

Answer 372

A

incorrect
The company has an equitable lease

Your answer is incorrect. There is no contract to grant a lease, rather the deed is actually valid. Please review the case law on certainty of term and the nature of periodic tenancies in particular.

Answer 373

A

Correct
This is correct. On these facts, the occupiers appear to have the four unities (possession, interest, title and time) as required by AG Securities v Vaughan (1990). On the facts, the separate licence agreements are likely to be read interdependently as per Antoniades v Villiers (1990). If the agreements are exactly the same, placing each occupier under the same terms, they will be considered to be ‘artificially separate’ as per Antoniades and this will not defeat the 4 unities from being present. The occupiers would be joint tenants of the property pursuant to a lease.

If the occupier are employer and employee and the occupiers are required to live in the house to perfrom their employment duties, this would defeat a lease as it would be a service occupanies.

Answer 374

A

This is a joint lease because the man and woman have the four unities

Correct
This is correct. There is no indication that the man and woman do not have unity of possession. They have unity of interest as they both have a five year lease on the same terms with a joint obligation to pay £1000 rent; they have unity of title as they sign identical documents and they have unity of time as the interest of both started on June 7th. It is irrelevant that they signed the documents at different times.

On the facts the the separate licence documents are likely to be read interdependently as per Antoniades v Villiers (1990).

Answer 375

A

The tenant is permitted to make the alterations providing they do not devalue the premises

Correct
This is correct. Unless the lease stipulates otherwise, which it does not on the facts, the tenant is free to carry out any alterations to the premises. This is only subject to the legal doctrine of waste, which prevents alterations which would devalue the premises.

Answer 376

A

incorrect
The landlord can refuse consent but if it does consent it cannot demand payment for it unless the change involves a change to the structure

This is incorrect. This would be the best answer if the covenant was a qualified user covenant, to which LTA 1927, s 19(3) applies. However, it is an absolute alterations covenant on the facts. Revisit your understanding of the different types of covenant and how statute operates in respect of each one.

Answer 377

A

The premises must be put into repair if they are not already and then kept in the condition in which they would be kept by a reasonably minded owner

This is correct. A covenant to ‘keep’ premises in repair can be very onerous if the premises are not in a good state of repair at the start of the lease, as a covenant to keep the premises in repair also entails an obligation to put them in repair first. Once in repair the Court of Appeal in Proudfoot v Hart (1890) made clear that the premises should be kept in the condition in which they would be kept by a reasonably minded owner, having regard to the character, type and age of the premises.

Answer 378

A

The landlord is under a duty to give written consent / refusal, which it has not done in the circumstances.

Correct
This is correct. On the facts, the landlord is in breach of this statutory duty. Although it has responded within a reasonable time (within 28 days) and its refusal is arguably reasonable, it has not given written reasons.

The covenant is qualified. LTA 1927, s 19(1)(a) applies to this covenant, imposing an obligation on the landlord to act reasonably and not unreasonably withhold or delay its consent. The landlord has refused the request to assign on the basis that the assignee, the company, would compete with the Landlord’s business. This has been held to be a reasonable reason to refuse consent.

LTA 1988, s 1 also applies to this covenant (and generally all fully qualified covenants). It provides the landlord must give written consent within a reasonable time (unless it is reasonable to refuse) and written reasons must be provided.

Answer 379

A

The bank may be pursued by the landlord for the unpaid rent if there is a direct covenant between them.

Correct
As the bank is an intermediate tenant, there is no privity of estate between the landlord and the bank as the bank is no longer the tenant. There is no privity of contract between the landlord and the bank unless they entered into a direct covenant, pursuant to which the landlord could sue the bank for a breach of covenant by the bank’s successor in title.

This is an old lease on the facts, so a direct covenant is in the only way in which the intermediate tenant could be liabile. If there is no direct covenant, the bank will not be liable.

Answer 380

A

The landlord is liable for the breach of covenant because the breach occurred prior to the sale of the reversion.

This is a new lease and as per s 24(1) Landlord and Tenant (Covenants) Act 1995, a landlord is not released from liability for a breach of covenant occurring before the sale of the reversion. Even if the landlord had been released from liability in accordance with s 6 Landlord and Tenant (Covenants) Act 1995, s/he would not be released from liability in this case.

Answer 381

A

The assignee only has the benefit of the covenants; the landlord and new owner have the burden of the covenants.

Correct
The benefit of the covenants passes to the assignee under s 3 Landlord and Tenant (Covenants) Act 1995 and the tenant ceases to be entitled to the benefit under s 5(2)(b) Landlord and Tenant (Covenants) Act 1995.

The burden of the landlord’s covenants passes to the new owner under s 3 Landlord and Tenant (Covenants) Act 1995. The burden also remains with the landlord until it applies to be released from the burden of the landlord’s covenants as per s 6(2)(a) Landlord and Tenant (Covenants) Act 1995.

Answer 382

A

The investment company can sue the clothes retailer because it assigned the lease to the shoe shop without the investment company’s consent.

Correct
This is correct. There was an unauthorised assignment two years ago and the clothes shop would not have been automatically released from liability under s 5 LTCA 1995 (see s 11 LTCA 1995). The investment company can therefore still sue the clothes retailer for the shoe shop’s breach even though the clothes retailer did not provide an authorised guarantee agreement.

The other answers are incorrect because the clothes retailer is still liable for the shoe shop’s breach even though it did not provide an authorised guarantee agreement (see above) and the breach does not need to involve a fixed charge for the clothes retailer to be liable (see s 5 LTCA 1995 and s 11 LTCA 1995). It is incorrect to argue the investment company does not have the benefit of the redecoration covenant, because the benefit will have passed to it under s 3 LTCA 1995 as the covenant is not expressed to be personal. Also, original tenant liablity only applies to old leases and this is a new lease on the facts.

Answer 383

A

The landlord should pursue a claim for damages for breach of repair against the tenant.

Correct
This is correct and the best advice in the circumstances. The landlord does not wish to end the lease so forfeiture is not a good option. An injunction is not the appropriate remedy as it is an order which forces something to stop, which is not relevant to this breach. Specific performance is very rarely ordered against a tenant, so is not the best advice to the landlord. Finally, CRAR is only relevant where there is a beach of a rent covenant.

incorrect
The landlord should seek the remedy of specfic performance to force the tenant to carry out the repair.

This is incorrect and not the best advice as this remedy is very rarely ordered in respect of a repairing covenant because damages are considered adequate. Revisit your understanding of a landlord’s remedies.

Answer 384

A

The lease has been surrendered

Correct
The is correct. Surrender is the handing back of the lease by the tenant to the landlord with the landlord’s consent. This results in premature termination of the lease, which has occurred on the facts. A deed of surrender is often entered into and sometimes a surrender premium will be paid by the tenant to the landlord, which again is the case on the facts.

Answer 385

A

The landlord has waived its right to forfeit and it can never again forfeit for this specific breach

This is correct. The landlord’s agents has sent out a rent demand. This is an acknowledgement of the continued existence of the lease and evidence of the landlord’s intention that the lease should continue despite the breach. The breach (unauthorised subletting) is classed as a ‘non-continuing’ breach, which means waiver is permanent and it can never again forfeit for this specific breach. It does not matter that the waiver is inadvertent and that the agent was unaware of the breach.

Answer 386

A

incorrect
The court has total discretion whether to grant relief in the circumstances
This is incorrect. At or after a court order for possession, the court has discretion to grant relief on the condition that the arrears are paid. On the facts, the court order has not been made yet. Revisit your understanding of when relief is likely to be granted.

The court cannot grant relief in the circumstances
This is incorrect. Only in exceptional circumstances will the court not grant relief and certainly not on these facts. Revisit your understanding of relief for non payment of rent and when it is likely to be granted.

Answer 387

A

The landlord is not entitled to forfeit the lease because there is no express right to forfeit

This is correct. A legal lease, which the landlord and tenant have entered into on the facts, must contain an express right to forfeit in the event of tenant breach. A right to forfeit will not be applied on the facts.

If there was a right to forfeit, the landlord would not have waived this on the facts as the rental demand is served before the landlord is aware of the breach. The landlord would need to serve a s 146 notice, but would not need to comply with the Leasehold Property (Repairs) Act 1938 as the lease was only granted for 2 years, so it would not apply.

Answer 388

A

The lender should apply for a court order to obtain possession and then sell the property. The mortgagor is not entitled to apply to have the possession order postponed under the Administration of Justice Act.

This land law question assesses the topic of mortgages. In particular, your understanding of the lender’s rights on default and the lender’s right to possess.

This is correct, it is the best answer in the circumstances. There is no indication the office premises over which the loan is granted are vacant. Therefore, it is inadvisable for the lender to exercise self-help and the lender should seek a possession order. However, given the mortgage is not over residential property, the borrower is not entitled to apply for a postponement under s 30 of the Administration of Justice Act 1970 in the circumstances. The other options are less correct because possession through self-help is rarely if ever advisable with regard to occupied property, and the facts indicate that the power of sale has arisen and is exercisable (in addition to the fact that it would not make sense to appoint a receiver here).

Answer 389

A

The occupation agreement will be binding as an overriding interest.

This land law question assesses the topic of the leasehold estate. It requires application of the essential requirements of a lease and the formalities required to create a legal lease.

This is correct. A 7 year legal lease, which this is on the facts (it is for a certain term, grants exclusive possession and is granted by a valid deed) will take effect as an overriding interest (LRA 2002, sch 3 para 1). The lease does not need to be registered in order to be legal and will binding on a new owner of the burdened land.

Answer 390

A

1) A Limited 2) B Limited 3) C Limited

This land law question assesses priority of mortgages over registered land. In order to answer a question on priority, you need to also understand the formality rules as to the creation of legal and equitable mortgages.

This is correct. On the facts, there are 3 equitable mortgages. Although the mortgages to all the lenders are a purported grant of a legal mortgage, they all fail. A legal mortgage must be granted by deed (LPA 1925, s 52 , which must comply with LP(MP)A 1989, s 1) and be registered (LRA 2002, s 27(2)). The mortgage to A Limited has not been granted by deed, nor has it been registered. It is however in writing, contains all the terms and is signed by both parties. It therefore complies with LP(MP)A 1989, s 2 and therefore takes effect as a contract to grant a legal mortgage (an equitable mortgage). The mortgage to B Limited has been granted by deed, but it has not been registered. The mortgage to C Limited has not been granted by deed and takes effect as a contract to grant a legal mortgage - an equitable mortgage. The equitable mortgage has been registered. On the facts all of the mortgage are equitable. Under the rule of priority of mortgage over registered land, the priority of equitable mortgage is determined by reference to the date of creation. As all the mortgages are equitable, it does not therefore make a difference that the mortgage to C Limited has been registered. The mortgage to A Limited will rank in priority to the other two mortgages because it was created first.

Answer 391

A

The right of way is not an easement as permission to use it is required.

The land law question assesses easements, in particular your understanding of whether a right is capable of being an easement and has been acquired as one on a given set of facts.

Correct. This answer reflects the legal principal from the case of Green v Ashco Horticultural Ltd. If a landowner has to ask permission to exercise a right, it cannot be an easement.

Answer 392

A

The finance company is on notice of potential undue influence because of the nature of the relationship between the borrower and their parent and the reason for the loan.

This land law question assesses the circumstances in which a presumption of undue influence will arise.

This is correct. As in Barclays Bank v O’Brien [1993], the lender will be on notice of potential undue influence in these circumstances - it is both the assumed relationship of trust and confidence between the parties and the purpose of the loan, which is not for both parties benefit, it is for the benefit of the borrower’s business venture. The case of RBS v Etridge [2001] sets out the steps which the lender should take to fulfil its responsibility in these circumstances.

Answer 393

A

The parent must sign and date a document headed ‘deed’ and their signature must be attested by a witness.

This is a land law question. It concerns transfer of an unregistered freehold estate. It assesses your understanding of the legal requirements necessary to effect a legal transfer and the requirements of a deed.

This is the best answer. A deed is required to effect a transfer of the legal estate as stated in LPA 1925, s 52. The deed must comply with LP(MP)A 1989, s 1, which this document would - it must be described as a deed, be signed by the parent in the presence of a witness and it must be delivered, which would be done by dating the document. As the land is unregistered, the legal title transfers on completion of the deed. In contrast, where registered land is transferred, legal title does not pass until registration. This transfer would be a trigger for first registration of the land and legal title would revert back to the parent if this is not done within 2 months of the date of completion.

Answer 394

A

This land law question assesses the common law rules for passing the burden of a covenant.

The landowner can enforce the covenant against D as there is a mutual benefit.

This is the correct answer. This type of covenant will fall under the rule in Halsall v Brizell, and provided it meets the relevant tests (the benefit and burden must be conferred in the same transaction, there must be a close link between them and there must be a genuine choice whether to accept the benefit) which there is no indication it does not, then the landowner can enforce this directly against D under this rule.

Answer 395

A

This questions assesses your understanding of the equity of redemption, in particular the equitable right to redeem and the validity of a clause that attempts to postpone redemption.

If the property is a commercial freehold property.

A court may allow a lender to postpone the date of redemption if the property is a freehold and if it is part of a commercial bargain as per Knightsbridge Estates Trust Ltd v Byrne. This is less likely if the property is a residential freehold.

Answer 396

A

Because the covenant is positive.

This land law question assesses the rules that govern passing the burden of a covenant in equity. You need to know and be able to apply each aspect of the rule in Tulk v Moxhay to a given set of facts.

This is correct. The general test to determine whether a covenant is negative is whether it can be observed without expenditure or effort – whether it can be observed by inaction. If payment of money is required, then this will be a positive covenant under the ‘hand in the pocket test’ (Haywood v Brunswick Permanent Benefit Building Society). Although this covenant is worded in the negative, the substance of it is positive: it requires effort and expenditure not to let House 2 fall into disrepair. Therefore, the burden of this covenant will not pass to D in equity. The other answers are incorrect because the facts state that A’s solicitor protected the covenant. As House 2 is registered land, this will mean that A’s solicitor secured the entry of a notice on the charges register of House 2 (s32 LRA 2002) in order to bind D as a purchaser for valuable consideration (s.29(2) LRA 2002). The covenant does clearly touch and concern the dominant land because it affects the value, quality etc of House 1 and House 1 and House 2 are adjoining properties and so they are sufficiently proximate for the dominant land (House 1) to derive a real benefit from the restriction affecting the servient land (House 2) (Bailey v Stephens). There is express wording here that shows that the original parties (the landowner and B) intended the burden of this covenant to run with House 2, so it is incorrect to assert that the original parties did not intend this.

Answer 397

A

Your client’s action will be successful as the satellite dish is protruding into the lower airspace.

This is a land law question. It concerns the legal issue of ‘what is land’. You need to understand the legal rules determining a landowners’ rights in the airspace above their land.

This is the correct answer. A landowner owns the airspace that is deemed to be lower airspace, as defined in Bernstein v Skyviews, as the amount of airspace that is necessary for the ordinary use and enjoyment of the land. A protrusion at the height of the top floor of a house will be likely to satisfy this test and therefore be actionable.

Answer 398

A

The lender can possess the hot tubs. They form part of the land and are subject to the mortgage as there is a high degree of annexation and the purpose of annexation is to enhance the enjoyment of the land.

The question assesses the topic ‘what is land’ and in particular, the distinction between fixtures / chattels and the application of the legal test to determine if an item is a fixture or not.

This is correct. The degree of annexation is high as the tubs are sunken and will be plumbed and wired in. This gives rise to a presumption of a fixture which can be rebutted when looking at the purpose of annexation. However here the purpose of annexation is not just to enjoy the hot tubs as hot tubs, but to enhance the enjoyment of the whole property in its use as a hotel.

Answer 399

A

Although the covenant was not protected, C will be deemed to have had notice of it under the Land Registration Act 2002.

This land law question assesses the rules that govern the passing of a burden of a covenant in equity, in particular notice. You need to know and be able to apply each of the aspect of the rule in Tulk v Moxhay.

This is the correct answer. Although the covenant was not protected with a s.32 Land Registration Act 2002 notice on the charges register of Red House, as C was not a purchaser for valuable consideration of Red House, under the basic rule of priority in s.28 together with s. 29(1) Land Registration Act 2002, C will be deemed to have notice of the covenant because it was gifted to C.

Answer 400

A

This land law question assesses the distinction between a lease and licence. You need to know, understand and recognise from a given set of facts the essential requirements of a lease.

The parties have not entered into a legal lease as the correct formalities have not been complied with

This is correct. Although there is a certain term (5 year fixed term) and there is nothing to suggest there is no exclusive possession (the right of entry is restricted, more of an acknowledgement of exclusive possession rather than something that would defeat it - Street v Mountford), on the facts the agreement does not comply with the correct formalities. A lease of 5 years must be granted by deed to be legal (LPA 1925, s 52). On the facts, the agreement does not comly with the legal requirements of a deed (LP(MP)A 1989, s 1) as it is not intended as a deed and has not been executed as a deed - the signature of the grantor (the would be landlord) has not been witnessed. There is no indication the agreement has been delivered either. The agreement would not need to be registered in order to be legal. Leases of over 7 years take effect as overriding interests (LRA 2002, sch 3 para 1). However, this does not matter on the facts as there is no valid deed.

Answer 401

A

The tenant has acquired an express easement which is equitable due to lack of formalities

This land law question assesses your understanding of the distinction between legal and equitable easements and express and implied acquisition.

This is correct. The easement is express. It is capable of being legal as it is for the duration of the lease (s.1(2)(a) LPA 1925) and has been created in a legal deed in accordance with s.52 LPA 1925. However, it fails as a legal easement due to formalities as it has not been registered in accordance with s.27(2) LRA 2002. It appears that the deed may amount to a s.2 LP(MP)A 1989 compliant contract and there is nothing on the facts indicating such contract is not capable of specific performance as per [Walsh v Lonsdale (1882) LR Ch D 9]. As such, the easement is likely to be equitable.

Answer 402

A

Implied acquisition under s.62 of the Law of Property Act 1925

This land law question assesses your understanding of the acquisition rules of an easement. You need to be able to identify whether an right has been acquired as an easement and how on a given set of facts.

This is correct. The neighbour has most likely acquired an easement impliedly under s.62 of the Law of Property Act 1925. On the grant of the second 7 year lease, the informal permission to use the outbuildings is upgraded to an easement and implied into this lease. This is similar to the facts of Wright v Macadam [1949] 2 KB 744, which supports this mode of acquisition. An easement can be acquired expressly or impliedly. You should consider first if there has been express acquisition – is the easement written down and does it comply with the necessary formalities? If not, consider if the circumstances mean the easement could have been acquired impliedly by one of the recognised modes. Certain modes of implied acquisition only apply if it is a grant, rather than a reservation, situation. It is therefore important that you understand not only the different modes of acquisition, but also the distinction between reservation and grant.

Answer 403

A

C is bound by the interest as C is not a purchaser for money or money’s worth under the Land Charges Act 1972

This is correct. In order to take the land free of the unprotected option, C must show that it is a purchaser for money or money’s worth of a legal estate: Land Charges Act 1972, s 4(6). C is actually a donee (as the land was gifted) and therefore is bound by the interest.

Answer 404

A

A does not have a right to forfeit without first obtaining the leave of the court

This is correct. The Leasehold Property (Repairs) Act 1938 applies to covenants to repair in any lease when the lease is granted for over 7 years and there are at least 3 years still to run. This provides additional protection to tenants in the event the landlord seeks to forfeit a lease for breach of a repair covenant, which the landlord (A) is seeking to do on the facts here. On the facts, the lease contains an express right to forfeit in the event of tenant breach and this right has not been waived on the facts. The landlord must serve s 146 notice and give the tenant the chance to remedy the breach within a reasonable time, which it has done. The notice must also inform the tenant of their right under the 1938 Act to serve a counter notice within 28 days. We are told that the tenant has served a counter-notice, therefore the landlord cannot proceed to claim forfeiture without first obtaining the lease of the court. It does not matter that the tenant has failed to remedy the breach in the circumstances.

Answer 405

A

The occupier will not have protection because rights under the 1954 have been excluded

This is correct. Under s 38A of the 1954 Act, before completing the lease, the landlord and tenant can agree to exclude the lease from the protection of the 1954 Act. The tenant must sign either a simple declaration or a statutory declaration (both have prescribed forms). Which one is needed depends on whether the 14 days of the landlord’s warning notice can be complied with or not. Whether the simple or statutory declaration procedure is used, the lease must contain: a) Wording that the parties have agreed to exclude security of tenure; and b) Reference to both the warning notice and the tenant’s declaration. It is not clear if this is the case, but we are told on the facts that a warning notice has been served and the occupier has sworn a statutory declaration. This is therefore the best answer.

Answer 406

A

The purchasers will be bound because B has an actual occupation overriding interest.

This is correct. B contributed to the purchaser price of the house so has a beneficial interest under a trust which may bind a purchaser for valuable consideration as an actual occupation overriding interest under Sch 3 para 2 Land Registration Act 2002. The exception in sch 3 para 2(c) would not apply here. The other answer options are incorrect because the land is registered, overreaching would not automatically occur here as there is a sole proprietor and, as stated above, B has a beneficial interest in and is in actual occupation of the land.

Answer 407

A

X should register a notice on the charges register of Y’s land to protect the interest.

A s 32 notice under the LRA 2002 is required to protect this covenant against a purchaser for valuable consideration of the servient land to the covenant.

Answer 408

A

The landlord cannot unreasonably withhold its consent to the works

This is correct. The covenant is a qualified covenant against alterations on the facts. LTA 1027, s 19(2) applies to this covenant and converts a qualified covenant against alterations that amount to improvements (in the eyes of the tenant) into a fully qualified one. This means the landlord must act reasonably in the circumstances and can only refuse consent if reasonable in the circumstances and on grounds that relate to the landlord and tenant relationship.

incorrect
The landlord can refuse consent but the landlord cannot demand payment for its consent

This is incorrect. This would be the best answer if the covenant was a qualified user covenant, to which LTA 1927, s 19(3) applies. However, it is an alterations covenant on the facts.

Answer 409

A

The landlord should sue B for the outstanding rent as B has not been released from the covenants on assignment

This is correct. B should have obtained The landlord’s consent to assign but did not do so. This is therefore an unauthorised assignment and B remains liable for all breaches of covenant as if the assignment had never taken place: Landlord and Tenant (Covenants) Act 1995, s 11.

Answer 410

A

The owner and the occupiers are employer and employees respectively and the occupiers are required to live in the house to perform their employment roles.

As the owner and occupiers are also in an employer-employee relationship and (as in Norris v Checksfield (1991)) the occupiers are required to live in the property for the better performance of their duties, they have service occupancies which are licences.

Answer 411

A

The man may declare this trust orally but the declaration must be evidenced in writing signed by the man

This is the correct answer. S53(1)(b) Law of Property Act 1925 requires express trusts of land to be signed by the person creating the trust, which is the man.

Answer 412

A

The landlord is able to forfeit immediately by peaceable re-entry of court order

This is correct. The lease contains an express right to forfeit and there is nothing to indicate that the landlord has forfeited its right to forfeit. As this is a breach of rent covenant, the landlord needs to serve a formal demand, unless there is an express exemption in the lease, which there is. The landlord is therefore entitled to forfeit immediately. As the lease is of commercial premises, the landlord is entitled to exercise its right by peaceable re-entry.

Answer 413

A

The landlord can recover six months’ arrears at the increased rent from B.

This is correct. Although Landlord and Tenant (Covenants) Act 1995, s 5 automatically releases an outgoing tenant from liability for lease covenants, the Authorised Guarantee agreement supersedes this. The landlord must act quickly to serve notice on B under Landlord and Tenant (Covenants) Act, s 17 as B is only liable for six months’ arrears from the date of the s 17 notice. Liability is for the increased rent as this is a foreseen variation of the lease: Landlord and Tenant (Covenants) Act 1995, s 18.

Answer 414

A

The occupier has an equitable lease for seven years

Correct. Although the legal lease for seven years has not yet been granted, in equity a contract for a lease is as good as a lease and prevails over the common law periodic tenancy interpretation: Walsh v Lonsdale. The other options are therefore incorrect. Further, there is no such thing as an equitable periodic tenancy.

Answer 415

A

The parent’s interest will not bind the buyer because it has been overreached.

This is correct. Although the parent ad a beneficial interest under a trust due to their contribution to the purchase price, that interest was overreached when the buyer paid the purchase money to the couple. See sections 2 and 27 Law of Property Act 1925. The other answers are incorrect because they fail to take account of overreaching or incorrectly apply the enforcement rules relating to registered land.

Answer 416

A

A and B are the joint legal owners. They each own one-half of the equitable interest.

This is the correct answer. The equitable joint tenancy was severed by mutual agreement: Burgess v Rawnsley [1975] Ch 429. As a result, A and B became tenants in common of the equitable interest, each being entitled to one-half of that interest: Goodman v Gallant [1986] Fam 106.

Answer 417

A

The siblings have a joint tenancy in equity because there was an express declaration they hold as joint tenants.

This answer is correct. This is correct because there is an express declaration and it is conclusive: Pink v Lawrence (1978) 36 P & CR 98

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