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Structure: Land > Structure: Registered and Unregistered Land > Flashcards

Structure: Registered and Unregistered Land Flashcards

1
Q
  1. Define the interest(s) that may exist and determine whether they are capable of being legal
A 
A) main interests and estate in land that can be legal, provided each one complies with requisite formalities, are respectively: 
- easements (s1(2)(a) LPA 1925)
- mortgages (s1(2)(c) LPA 1925)
- leases (ss1(1)(b) & 205 (1) (xxviii) LPA 1925)
B) all other interests:
- freehold covenants
- estate contracts
- options to purchase; and
- beneficial interests under a trust
... can only be equitable s1(3) LPA
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2
Q
  1. What are the formalities? Has it been validly created? LEASES
A

A) LEGAL LEASES
- specific formalities will depend on length of lease:
1. Greater than 7 years:
- by deed (s52(1) LPA); and
- registered (s27(2)(b)(i) LRA 2002 for registered land; s4(1)(c) LRA 2002 for unregistered land)
2. Equal to or fewer than 7 years but greater than 3 years: by deed (s52(1) LPA)
3. Fewer than 3 years: two types of lease can exist:
- fixed term lease: by deed (s52(1) LPA); or
- periodic term lease (“parole lease”). This can be oral (s54(2) LPA Fitzkriston LLP v Panayi), provided tenant:
i) is in possession of property; and
ii) pays best rent (market rent - Fitzkriston), without paying a fine
B) EQUITABLE LEASES
- 3 key ways to create an equitable lease
1. out of an agreement to create a lease
2. from a failed legal lease
3. lease granted over equitable estate
Regardless of situation, equitable lease must:
- be in writing (s2(1) LP(MP)A 1989)
- contain all agreed terms (s2(1) LP(MP)A)
- be signed by both parties (s2(1) LP(MP)A)
- be capable of specific performance (Walsh v Londsdale)
- but in recent case of Sahota v Prior where oral representations were made outside written lease the tenants were allowed to rely on promissory estoppel to enforce terms of agreement
- REMEMBER, if you identify both legal lease and equitable lease in same situation, equitable lease will prevail (Walsh)
- most common situation for this to happen is for leases of fewer than 3 years

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3
Q
  1. What are the formalities? Has it been validly created? LEASES
A

A) LEGAL LEASES
- specific formalities will depend on length of lease:
1. Greater than 7 years:
- by deed (s52(1) LPA); and
- registered (s27(2)(b)(i) LRA 2002 for registered land; s4(1)(c) LRA 2002 for unregistered land)
2. Equal to or fewer than 7 years but greater than 3 years: by deed (s52(1) LPA)
3. Fewer than 3 years: two types of lease can exist:
- fixed term lease: by deed (s52(1) LPA); or
- periodic term lease (“parole lease”). This can be oral (s54(2) LPA Fitzkriston LLP v Panayi), provided tenant:
i) is in possession of property; and
ii) pays best rent (market rent - Fitzkriston), without paying a fine
B) EQUITABLE LEASES
- 3 key ways to create an equitable lease
1. out of an agreement to create a lease
2. from a failed legal lease
3. lease granted over equitable estate
Regardless of situation, equitable lease must:
- be in writing (s2(1) LP(MP)A 1989)
- contain all agreed terms (s2(1) LP(MP)A)
- be signed by both parties (s2(1) LP(MP)A)
- be capable of specific performance (Walsh v Londsdale)
- but in recent case of Sahota v Prior where oral representations were made outside written lease the tenants were allowed to rely on promissory estoppel to enforce terms of agreement
- REMEMBER, if you identify both legal lease and equitable lease in same situation, equitable lease will prevail (Walsh)
- most common situation for this to happen is for leases of fewer than 3 years

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4
Q
  1. What are the formalities? Has it been validly created? EASEMENTS
A

A) EXPRESS LEGAL EASEMENT, must be:

  • by deed (s52(1) LPA)
  • for duration equivalent to legal estate (s1(2)(a) LPA)
  • registered (s27(2)(d) LRA 2002)

B) IMPLIED LEGAL EASEMENT:

  • no formalities required, as this kind of easement is implied by necessity under the common law (Manjang v Drammeh), easement must be both:
    i) impliedly acquired for duration of legal estate (s1(2)(a) LPA)
    ii) implied into a deed

C) EXPRESS EQUITABLE EASEMENT, must be:

  • in writing, containing all agreed terms and signed by both parties (s2(1) LP(MP)A)
  • capable of specific performance (Walsh v Londsdale)
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5
Q
  1. What are the formalities? Has it been validly created? OTHER INTERESTS IN LAND THAT CAN ONLY BE EQUITABLE
A

A) FREEHOLD RESTRICTIVE COVENANTS:
- must be in writing, signed by covenantor (s53(1)(a) LPA)

B) MATRIMONIAL HOME RIGHT:
- arises automatically by virtue of being a spouse of proprietor of land (s30 Family Law Act 1996 FLA)

C) ESTATE CONTRACTS, must be:

  • (i.e. option to purchase or right of pre-emption)
  • in writing, containing all agreed terms and signed by both parties (s2(1) LP(MP)A)
  • capable of specific performance

BENEFICIAL INTEREST UNDER A TRUST (BIUT):

  • express trusts - must be evidenced in writing signed by settlor (s53(1)(b) LPA)
  • implied trusts - arise without formalities (s53(2) LPA), for example when one party contributes to purchase price (Bull v Bull)
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6
Q
  1. Will the interests bind a buyer? LEASES
A

A) LEGAL LEASES:
1. greater than 7 years:
- registered land: registration is required (s27(2)(b)(i) LRA; s4(1)(c) LRA 2002
- unregistered land: legal interest can automatically be enforced against any purchaser of that land (Mercer v Liverpool)
2. equal to or fewer than 7 years (inc leases fewer than 3)
- registered land: such legal lease is overriding interest (Sch 3 Para 1 LRA 2002) and purchaser will be bound
- unregistered land: legal interest can automatically be enforced against any purchaser of that land (Mercer)
B) EQUITABLE LEASES:
1. registered land: notice on Charges Register required to bind all purchasers (ss32 and 29(2) LRA 2002)
- if no such notice exists, purchaser will not be bound if he is purchaser for valuable consideration (ss28(1) and 29(1) LRA 2002), regardless of any notice he may have of interest (De Lusignan v Johnson)
- however a volunteer/donee (someone given land as gift or inheritance) will be bound by interest even if not registered
NB: purchaser will be bound by equitable lease if it constitutions an overriding interest i.e. if lessee (person to whom lease was granted) has an interest in land and is in actual occupation of land (sch 3 para 2 LRA 2002) unless:
i) lessee did not disclose lease to purchaser following reasonable enquiry (sch 3, para 2(b) LRA 2002); or
ii) lease would not have been obvious on reasonable inspection and purchaser did not have actual knowledge of lease (sch 3, para 2(c)(i)-(ii) LRA 2002)
2. unregistered land:
- registration of lease as Class C(iv) land charge on land register constitutes actual notice (s2(4(iv) Land Charges Act 1972 (LCA) and consequently will bind any purchasers (s198(1) LPA)
- if land charge is not entered into land register, lease will bind anyone, except purchaser of legal estate for money or money’s worth (s4(6) LCA)

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7
Q
  1. Will the interests bind a buyer? EASEMENTS
A

A) EXPRESS LEGAL EASEMENTS:

  1. registered land - express legal easements must be registered to be binding on a purchaser (s27(2)(d) LRA 2002)
    - once registered, notice will be put on Charges Register of servient land (s38 LRA 2002 and Sch 2 LRA 2002)
  2. unregistered land - legal interests bind the world and can automatically be enforced against any purchaser of the land (Mercer v Liverpool)

B) IMPLIED LEGAL EASEMENTS:

  1. registered land - implied legal easements are overriding interests (Sch 3 para 2 LRA 2002) and there are no such registration requirements, this easement will bind purchaser of land if:
    i) purchaser has actual knowledge of it; or
    ii) easement is obvious on reasonable inspection; or
    c) easement was exercised in year prior to sale of land
  2. unregistered land - legal easements bind the world and can automatically be enforced against any purchaser of the land (Mercer v Liverpool)

C) EXPRESS EQUITABLE EASEMENTS:
1. registered land - notice on Charges Register is required to bind all purchasers (ss32 and 29(2) LRA 2002)
- if no such notice is inserted purchaser will not be bound if he is purchaser for valuable consideration (ss28(1) and 29(1) LRA 2002)
- however, purchaser will be bound by equitable easement if it constitutes overriding interest i.e. if owner of easement has an interest i.e. if owner of easement has an interest in the land and is in actual occupation of the land (sch 3 para 2 LRA 2002), unless:
i) lessee did not disclose easement to purchaser on reasonable enquiry (sch3 para 2(b) LRA 2002); or
ii) easement would not have been obvious on reasonable inspection and purchaser did not have actual knowledge of easement (sch 3, para 2I (i)- (ii) LRA 2002)
NB: when dealing with easements, being in actual occupation may be an issue, will depend on type of easement dealing with… if involves occupation (parking or storage), actual occupation more likely to be satisfied… if deal with easements that merely allow access, such as use of a staircase (Chaudhary v Yavuz) or right of ways (Holaw v Stockton Estates) then these will not allow actual occupation
2. unregistered land:
i. easements granted on or after 1 Jan 1926:
- registration of easement as Class D(iii) land charge on the register constitutes notice (s2(5)(iii) LCA) and consequently will bind any purchaser (s198(1) LPA)
- if land charge not entered into land register, easement will bind anyone except purchase of legal estate for money or money’s worth (s4(6) LCA)
ii. easements granted before 1 January 1926: these covenants will be binding on a purchaser, subject to doctrine of notice

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8
Q
  1. Will the interests bind a buyer? OTHER INTERESTS IN LAND THAT CAN ONLY BE EQUITABLE: A) FREEHOLD RESTRICTIVE COVENANTS:
A
  1. registered land:
    - notice on Charges Register required to bind all purchasers (ss 32 and 29(2) LRA 2002)
    - if no such notice is inserted, purchaser will not be bound if he is a purchaser for valuable consideration (ss 28(1) and 29(1) LRA 2002)
    - regardless of any notice he may have of the interest (De Lusignan v Johnson)
    - however, a volunteer/donee will be bound even if interest is not registered
    NB: purchaser will be bound by covenant if it constitutes an overriding interest i.e. if covenantee has interest in land and is in actual occupation of land (sch 3 para 2 LRA 2002) unless
    - covenantee did not disclose interest to purchaser on reasonable enquiry (sch 3 para 2(b) LRA 2002); or
    - freehold restrictive covenant would not have been obvious on reasonabele inspection and purchaser did not have actual knowledge of freehold restrictive covenant (sch 3 para 2(c)(i)-(ii) LRA 2002)
  2. unregistered land:
    i. covenants granted on or after 1 January 1926:
    - registration of restrictive covenant as Class D(ii) land charge on land charges register constitute actual notice (s2(5)(ii) LCA) and consequently will bind any purchasers (s198(1) LPA)
    - if land charge is not entered into land charges register, freehold restrictive covenant will bind anyone, except purchaser of legal estate for money, or money’s worth (s4(6) LCA)
    - covenants granted before 1 January 1926: these covenants will be binding on purchaser subject to doctrine of notice

NB: under s84(1) LPA land tribunal can modify a restrictive covenant
- applies if covenant is obsolete

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9
Q
  1. Will the interests bind a buyer? OTHER INTERESTS IN LAND THAT CAN ONLY BE EQUITABLE: B) MATRIMONIAL HOME RIGHT
A
  1. Registered land:
    - notice on Charges Register is required to bind all purchasers (ss32 and 29(2) LRA 2002)
    - if no such notice is inserted, purchaser will not be bound if he is a purchaser for valuable consideration (ss28(1) and 29(1) LRA 2002)
    - but note the following:
    i) a court can, if it decides that it is appropriate, make order to end or alter matrimonial home right, regardless of whether it has been registered in accordance with s32 LRA s33(3) FLA; Kaur v Gill
    ii) matrimonial home rights are not an interest in land (s31(10)(b) FLA) and consequently can never be an overriding interest under sch 3 para 2 LRA 2002
    iii) in scenario with matrimonial home right, may also want to discuss potential express or implied Beneficial interest Under a Trust (BIUT) - if something has been said indicating that a BIUT may exist or if the party contributed to the purchase price
  2. unregistered land:
    - registration of matrimonial home right as Class F land charge on land register constitutes actual notice (s2(7) LCA) and consequently will bind any purchasers (s198(1) LPA)
    - if land charge is not entered in land register, matrimonial home right will bind anyone, except purchaser for value of any interest in land (s4(8) LCA)
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10
Q
  1. Will the interests bind a buyer? OTHER INTERESTS IN LAND THAT CAN ONLY BE EQUITABLE: C) ESTATE CONTRACTS
A
  1. registered land:
    - notice on Charges Register required to bind all purchasers (ss 32 and 29(2) LRA 2002)
    - if no such notice is inserted, purchaser will not be bound if he is purchaser for valuable consideration (ss28(1) and 29(1) LRA 2002) regardless of any notice he may have of interest (De Lusignan v Johnson)
    - however a volunteer/donee will be bound even if interest is not registered
    NB: purchaser will be bound by estate contract if it constitutes an overriding interest i.e. person claiming benefits of estate contract has interest in land and is in actual occupation of land (sch 3 para 2 LRA 2002), unless:
    i) beneficiary of estate contract did not disclose interest to purchaser on reasonable enquiry (sch 3 para 2(b) LRA 2002); or
    ii) estate contract would not have been obvious on reasonable inspection and purchaser did not have actual knowledge of estate contract (sch 3 para 2 (c)(i)-ii) LRA 2002)
    NB: estate contracts are interests in land from time of their creation (s115 LRA 2002)
  2. unregistered land:
    - registration of estate contract as Class C(iv) land charge on land register constitutes notice (s2(4)(iv) LCA) and consequently will bind any purchasers (s198(1) LPA)
    - if land charge is not entered into land register, estate contract will bind anyone, except purchaser of legal estate for money or money’s worth (s4(6) LCA)
    - in unregistered land, an estate contract becomes an interest in land only at the point where it becomes exercisable, i.e. where land is put on sale (Pritchard v Briggs)
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11
Q
  1. Will the interests bind a buyer? OTHER INTERESTS IN LAND THAT CAN ONLY BE EQUITABLE: D) BENEFICIAL INTERESTS UNDER A TRUST (BIUT)
A
  1. registered land:
    - BIUT must be entered as a restriction on proprietorship register (s40 LRA 2002)
    - however even if restriction is entered on register, BIUT may be overreached by paying purchase price to two or more trustees (ss 2(1)(ii) and 27(2) LPA; City of London v Flegg, compare with Williams Bank v Boland)
    - by doing so, BIUT becomes detached from land and transferred to money paid by buyer, and purchaser will obtain property free from interest in land

if s40 restriction not entered, and money is paid to only one trustee, BIUT will bind purchaser as overriding interest under sch 3 para 2 LRA 2002, if person claiming BIUT has interest in land and is in actual occupation

NB: BIUT is interest in land (per Williams Bank) for person in actual occupation of land (sch 3 para 2 LRA 2002), unless:

  • beneficiary did not disclose BIUT to purchaser on reasonable enquiry (sch 3 para 2(b) LRA 2002); or
  • BIUT would not have been obvious on reasonable inspection and purchaser did not have actual knowledge of BIUT (sch 3, para 2 (c)(i)-(ii) LR)
  1. unregistered land: no registration is required
    - however, BIUT may be overreached by paying purchase price to two or more trustees (ss2(1)(ii) and 27(2) LPA; City of London, compare with Williams Bank)
    - when purchase price is paid to only one trustee, thus failing to overreach, purchaser is subject to doctrine of notice and will be bound unless he is Equity’s Darling (Williams Bank)
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12
Q
  1. Conclude
A
  • what interests are there in the land?
  • are they overreached?
  • are they overriding?
  • will buyer take land free of all interests?
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Structure: Land (4 decks)

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