Land Law revision notes PDF

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Introduction to Land LawLand law draws the distinction between real and personal property. Real property is land, and personal property is all that is not land.It tells us that land law is about more than just physical, tangible property such as trees and coal (so- called corporeal hereditaments): i...

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Introduction to Land Law Land law draws the distinction between real and personal property. Real property is land, and personal property is all that is not land.

‘Land’ includes land of any tenure, and mines and minerals, whether or not held apart from the surface, buildings or parts of buildings (whether the division is horizontal, vertical or made in any other way) and other corporeal hereditaments; also a manor, an advowson, and a rent and other incorporeal hereditaments, and an easement, right, privilege, or benefit in, over, or derived from land.

It tells us that land law is about more than just physical, tangible property such as trees and coal (socalled corporeal hereditaments): it also concerns intangible rights in land (so-called incorporeal hereditaments).

Personal Rights vs Proprietary Rights Propriety rights can be binding on third parties. Personal rights can only bind the parties which create the rights.  

A contractual licence is a personal right. A lease is a proprietary right.

Tenure, estates, and interests in land Tenure Feudal system imposed by William the Conqueror. Land is owned by the king and cannot be transfer besides on grounds of services such as Knights Service and Socage. Very little relevance in modern law. Estates in Land An estate in land is an interest in land for some particular duration. Today there are two types of estate: the Freehold and the Leasehold. I.

The Freehold ‘An estate in fee simple absolute in possession’  Fee Simple: Freeholder has the right use and enjoy the land for the duration of his lifetime and can transfer ownership to others.  Absolute: Freeholders rights are neither conditional nor liable to be ended on the occurrence of some event.  In possession: Freeholder enjoys immediate right to occupy the land.

II.

The Leasehold ‘Terms of years absolute’  A leaseholder is entitled to use and enjoyment of the land exclusively for a certain period of time and can transfer or sell (‘assign’) the leasehold to a third party provided the term of the lease has not come to an end.

Interests in Land An interest in land is a property right which does not confer any rights of ownership. Examples include:   

Mortgages Options Easements

The proprietary rights are binding on third parties, such as new owners.

Legal and Equitable Rights Legal rights A right must be created by a deed. A deed must:  Be made in writing,  Made clear on its face of its intention to be a deed,  Be validly executed

equitable rights A right will be equitable if:  It is not capable of being legal under of s. 1 of the LPA 1925; or  An attempt to make a legal right has been a failure of formalities; or  there has been a failure to register the right The significance of the legal/equitable distinction comes into sharp focus when deciding if a third-party acquiring land is bound by pre-existing property rights operating over that land.

Reforming the Law: The 1925 Legislation I.

Reclassification of estates and interests in land. Issue: Fee simple could be fragmented into a series of estates requiring a purchaser to identify all the owners. Resolution: Reducing the number of legal estates to two (freehold and leasehold) and by making the fee simple absolute in possession the essential basis of conveyancing.

II.

Statutory machinery for the protection of interests in the land. Issue: Wide interpretation of notice meaning many purchasers found themselves bound by rights they had no knowledge of. Resolution: Overreaching- a statutory mechanism under which a purchaser could ensure that when they bought land that they took the land free from certain equitable interests. Secondly, the legislation introduced the statutory machinery for registration. The Land Registration Act 1925 (LRA 1925)—now replaced entirely by the Land Registration Act 2002

Registered and unregistered Land Registered Land (LRA 2002) Land is registered if it has been recorded at the Land Registry. Once a person is registered as the proprietor, the State guarantees their ownership. When the land is sold, the new owner must register the transfer at Land Registry, and they will then become the new registered proprietor. I.

Group 1- Substantively registrable estates: Legal fee simple and leasehold estates >7 years can be substantively registered.

II.

Group 2- Interests not substantially registrable but must be registered: The 2002 Act calls these ‘registrable dispositions’ and they only operate at law if they are completed by registration.

III.

Group 3- Interests capable of protection on the register. Not required to be registered but will take priority if registered.

IV.

Group 4- Overriding interests:

Unregistered Land Title is not to be found on any register but rather contained in the traditional, paper title deeds which comprise a bulk of documents kept by the current owner and a purchaser has to search through these title deeds to investigate the ‘root of title’ to be sure of what they are buying.

Land Law and Human Rights Human rights protect fundamental human values where land law is transaction-focused— dependent not on fundamental freedoms but on freedom of the parties to contract and on the primacy of administrative practices such as registration to ensure the free alienability of land.

The Human Rights Act 1998 There is no horizonal effect in ECHR (McDonald). This is criticised by Nield.

Article 1 of the First Protocol to the ECHR

Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law. The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.

When will Art. 1 of the First Protocol be engaged? Article comprises three rules:   

Rule 1: peaceful enjoyment of property Rule 2: deprivation of possessions Rule 3: control of possessions by the State.

Possessions: an autonomous meaning which is not limited to the ownership of material goods and is independent from the formal classification in domestic law. To qualify as ‘possessions’ under Art. 1, there must, however, be a discernible and associated economic value.

Acquisition of Land Formalities Legal requirements:  



Law of Property Act 1925, s.52: it must be created by deed. Law of Property Act (Miscellaneous Provisions) Act 1989: a deed is a document that calls itself a deed, and which the grantor must sign in the presence of a witness (who also signs as a witness). Land Registration Act 2002, s.27(2)(b): a lease of more than 7 years must also be registered.

Exception: A lease of no more than three years taking effect immediately in possession of best (or market) rent can take place by oral agreement: s.52 2 (d) LPA 1925 No legal lease if the interest is not registered. It can however be used in equity (Parker v Taswell) Requirements for an equitable lease: 1. 2. 3. 4. 5.

There be writing Containing all the main terms Signed by the parties With consideration/specific performance Clean hands

Land Registration-Title by registration Land Registration Act 2002: I.

Group 1- Substantively registrable estates:

II.

Group 2- Interests not substantially registrable but must be registered:

III.

Group 3- Interests capable of protection on the register.

IV.

Group 4- Unregistered overriding interests:

Compulsory registration Section 4:    

Transfer of registered freehold Grant of a lease of more than seven years Grant of a lease to take effect in the future (>3 months) Grant of a first mortgage

Registerable dispositions- Section 27     

Transfer of a freehold Transfer of a leasehold Grant of a lease of >7 years Grant of lease to take effect >3 months Express grant of an easement

Priority- Section 29 The focus is on the manner by which C acquires title: 1. 2. 3. 4.

Is there a registerable disposition Of registered land For valuable consideration Completed by registration

If yes... C takes the land subject to pre-existing interests (such as the right of ways) providing:  

The pre-existing interest is registered The pre-existing interest falls under Schedule 3

The pre-existing right overrides the disposition. If no… Section 28 applies. C is bound by all pre-existing rights of rem.

Interests that cannot be registered:  

Interest under trust of land A lease less than three years not required to be registered

Unregistered interests which override registered dispositions Schedule 3 Paragraph 1: All leaseholds granted for a term not exceeding seven years from the date of grant override registerable dispositions. Paragraph 2: An interest belonging at the time of the disposition to a person in actual occupation, so far as relating to land of which he is in actual occupation, except for: […] an interest which belongs to a person whose occupation would not have been obvious on a reasonably careful inspection of the land at the time of disposition, and of which the person to whom the disposition is made does not have actual knowledge at that time …

Williams & Glyn Bank v Boland Paragraph 3: Unregistered legal easements not requiring registration can also override providing that the easement has either been used in the previous year, or would have been obvious on a reasonably careful inspection of the land.

The Freehold Described in s.1 LPA 1925: An estate in fee simple absolute in possession.    

Fee – from old French for payment, as land was often given as payment for loyalty, men (for war), or other service. Simple – to distinguish this type of fee from others, such as fee tail Absolute – to describe that it is without condition or limit In Possession – to describe that it takes effect immediately in possession (upon grant), which can include a right to receive rent (e.g. if it is leased, s.205(1)(xix))

Classes of Freehold Title Upon registering the property for the first time, title is classified as one of the following

Proprietary Estoppel Disorganised rights Those that do not necessarily comply with formality requirements, but may still operate in rem. Beneficial interests under trust of land may be acquired on a resulting trust or constructive trust basis. Proprietorship (ownership) can be acquired by factual possession = intention to possess under the rules of adverse possession. Proprietary estoppel can generate an equity by estoppel which is capable of operating in rem.

A necessarily equitable interest in or over land, often without formality whatsoever. Can provide relief in the form of monetary award, some other personam right, or a right in rem. Where it operates in rem, subject to the usual rules on land registration.

Example: A let B believe that A’s garden was the property of B. B acts in detriment due to that belief (i.e.) looking after the garden. The circumstances as a whole would make it unconscionable to go back on assurance. Equitable estoppel arises

A SWORD Asserting right to the garden, registering notice against land or asking the court to give effect to the equity by estoppel

A SHIELD A protection against a. Use equitable interest as shield if b tried to sue for trespass by applying for an order of possession.

The court has huge discretion in the award of remedies- The could grant an estate in land; a licence to the land; compensation against assurance (value of the land) or cost of the detriment. Cobbe v Yeoman’s Row Management No equity as there was no clarity in the negotiations and no certainty. Too conditional. A claim cannot be found on unconscionability alone, there must be an undoubted belief.

Establishing Equity “If A under an expectation created or encouraged by B that A shall have a certain interest in land, thereafter, on the fait of such expectation and with knowledge of B and without objection by him, acts to his detriment in connection with such land, a court of equity will compel B to give effect to such expectation” – Taylor Fashions v Liverpool Victoria Trustees (1982) Oliver J.

Therefore, the ingredients are:   

An assurance relating to an interest in land Relied upon, reasonably, to one’s detriment Where it would be unconscionable to go back on the assurance

Detriment Cobbe – unsuccessful: assurance did not relate to a certain interest in land, and it was not reasonable for the assurance to be relied upon Gillett – a freehold estate plus farming assets Thorner – all estates in land relating to the ‘farm’ as it existed at the time of death

Satisfying the Equity Equity take affect where there is an assurance which is reasonably relied on to a person’s detriment. Bind third parties from that time. Jennings v Rice (2002)- Awarding property would have unjustly enriched C, awarded 200,000 instead. ‘If the claimant's expectations are uncertain, or extravagant, or out of all proportion to the detriment which the claimant has suffered, the court can and should recognise that the claimant's equity should be satisfied in another (and generally more limited) way.’ Walker LJ at [50] However, Suggit v Suggit (2010)- Full property was awarded despite only modest detriment. Davies v Davies- A scrutinised approach.

1. 2. 3. 4. 5.

Award the expectation loss Award the expectation loss, unless doing so is grossly disproportionate Try to strike a balance between the expectation loss and reliance loss Award the reliance loss Award the lesser of either expectation or reliance

Acquisition of Title (Mortgages) The legal concept of a mortgage A mortgage is a right in rem, granted by a mortgagor to a lender (the mortagagee) in return for a loan. The mortgagee enjoys an interest in the property which operates in rem.

Formalities and registration Requires a grant by deed (s.52 LPA 1925) and registration (s.27 LRA 2002). Failure to register the mortgage may create a mortgage in equity. The usual priority rules apply.

Rights of the Mortgagor (Freeholder/Borrower) Equity of redemption= the mortgagor’s bundle of rights. Equitable right to redeem- The right to pay off the loan, debt and charges and extinguish the mortgagees’ interest. Must not be any restriction on right to redeem, if there are they will be void.   

Express exclusion of the right to redeem (Jones v Morgan) A term that restricts or postpones the timing of redemption (Fairclough v Swan Brewery). However, note that commercial contexts might permit such a term (Knightsbridge Estate’s Trust v Byrne).

Options to Purchase- The courts will strike out a term which gives the mortgagee a right to purchase the mortgaged property. Samuel v Jarrah Timber- A right to purchase mortgaged stock was a clog on the equity of redemption. Reeve v Lisle- Option to purchase was permitted when it was conveyed by a separate agreement with the mortgagee. Collateral Advantages The mortgagee may seek to introduce other advantages beyond the repayment of the loan. E.g., a Shell petrol station may only purchase petrol from shell. These may be valid dependant on their nature and extent. Noakes v Rice: A collateral damage may only be valid for the term of the mortgage. Kreglinger v New Patagonia Meat and Cold Storage: A fiver year collateral advantage beyond the mortgage term in a commercial context was enforceable. Is the advantage unfair or unconscionable? Is it a clog on the equity of redemption? Is it consistent or repugnant to the contractual and equitable right to redeem?

Unconsionable and Oppressive Terms: Multiservice Bookbinding v Marden Terms would have to be oppressive or unconscionable to be void, would not be use in unreasonable terms.

Rights of the Mortgagee (lender) 

Receive payments in accordance with the agreement, interest and charges.



The mortgagee has a right to seek possession of the property (Quennell, Ropaigealach)



The mortgagee can ask the court for an order for possession, which is then assessed by the court taking into account relevant statutory provisions.



In the event of default, the mortgagee also has a power of sale under s.101 LPA 1925.

Power of sale Has the power of sale arisen under s.101?   

Mortgage must be granted by deed – i.e. a legal mortgage The deed did not exclude the power of sale Mortgage money is now due (arrears)

Is the power exercisable under s.103?   

Notice must be served requiring payment, then three months must have passed since notice is served; OR Repayment is at least 2 months in default (in respect of interest); OR Another term of the mortgage has been breached.

A third party buying the reclaimed property   

S.88 LPA 1925 assure title to property of any purchaser S.104 Transfer takes priority over other interests S.104 confirms that the purchaser receives an unimpeachable title

Money is allocated in the following order:    

Any prior charge is redeemed; The costs of sale are met; The mortgagee’s expectation is met (debt, interest, charges) Balance to be paid to the mortgagor.

(s.105 LPA 1925)

Duty of Care of the mortgagee towards the mortgagor Cuckmere Brick v Mutual Finance holds that the mortgagee owes a duty to obtain a good price, act fairly and in good faith.

The court has always asserted a right of the mortgagor to obtain relief in the form of a postponement or adjournment of possession proceedings- usually for no more than 28 days (Birmingham v Caunt) This power has been substantially extended by 2.36 Administration of Justice Act 1970:   

Only concerns land that includes a ‘dwelling house’… Where mortgagee has commenced court proceedings… And the court is convinced that ‘any sums due’ are payable ‘within a reasonable period’… …the court may: Adjourn proceedings; or Postpone possession, or suspend execution of a possession order.

“any sums due” Halifax v Clark, the totality of the debt was due. Parliament disagreed and stated that this was purely to make sure the mortgagor could get back on track with payments. Response: s.8 Administration of Justice Act 1973- Mortgagor cannot be expected to pay the capital sum owed in the event of default.

“Reasonable Period” •

Norgan defaulted on her mortgage, and the mortgagee sought a possession order.

•

At trial, the judge arrived at 4 years, being a reasonable period to repay the arrears, but found that it was unlikely that Norgan would be able to repay the money owed in that time – so ordered possession.

•

The Court of Appeal allowed an appeal: the starting point must be the term of the mortgage agreement.

•

The courts should then look into a range of factors regarding the personal circumstances of the mortgagor to see if repayment is likely in the circumstances.

Ropaigealach v Barclays Bank (2000)    

Mortgagor were renovating property, so were not in occupation of the house. They fell into arrears- Barclays’ letters went unnoticed. Barclays sold the house under their power of sale. Ropaigealach sought to stop the sale, citing s....