Land Law Tutorial 2 - Matthew Stone PDF

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UNIVERSITY OF ESSEX LW303 LAND LAW, 2016-17

TUTORIAL 2 – Land registration, overriding interests, and overreaching

Dixon, Modern Land Law, 10th ed., chapter 2 and pp. 157-166. Key cases:

Williams & Glyn’s Bank v. Boland [1980] 2 All ER 408 City of London Building Society v Flegg [1988] AC 54

Further reading:

1. The cases of Williams & Glyn’s Bank v Boland and City of London Building Society v Flegg both describe similar facts: each involves a mortgage lender (‘mortgagee’) attempting to take possession of a property over which they have a mortgage charge, against the wishes of occupants who were not liable for the mortgage debt. Write a summary of each case, and explain why they were decided differently. Is the difference in outcome justifiable? Williams & Glyn’s Bank v Boland:   

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Mr Boland was the sole registered proprietor of the matrimonial home. Mrs Boland had made substantial contributions to the purchase price and mortgage payments entitling her to a beneficial interest in the house. Mr Boland mortgaged the house and defaulted on payments. Therefore, the Bank sought possession of the property and Mrs Boland claimed an overriding interest under s.70(1)(g) Land Registration Act 1925 based on her beneficial interest. The bank argued that the wife’s occupation was not inconsistent with the title offered and that an interest could not be both a minor interest and overriding interest. It was held that the wife’s beneficial interest was overriding by virtue of her actual possession. Therefore, the bank’s attempt for possession was unsuccessful.

City of London Building Society v Flegg: 

Mr & Mrs Maxwell Brown purchased Bleak House in 1977 for £34,000. Half the purchase price was funded by the parents of Mrs Maxwell Brown, Mr & Mrs Flegg.

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The house was registered for Mr and Mrs Maxwell Brown who held the legal title on trust for sale. Both the Flegg’s and Maxwell’s occupied the house. In 1982 the Maxwell Browns, in breach of trust, mortgaged the property for £37,500 to City of London Building Society. The Flegg’s were unaware of this mortgage and the Maxwell Browns used the money for their own purposes. The Maxwell Browns subsequently defaulted on the mortgage payments and City of London Building Society brought an action seeking possession of the house. The Flegg’s defended on the grounds that they had a beneficial interest in the property through their contribution to the purchase price and this was an overriding interest under s.70(1)(g) Land Registration Act 1925 since they were in actual occupation when the mortgage was taken out. City of London Building Society claimed that the Flegg’s interest had been overreached since they had paid the capital moneys to two trustees. The trial judge found for the Building Society. This decision was reversed by the Court of Appeal. City of London Building Society appealed to the House of Lords. It was held the Flegg’s interest had been overreached. Their right existed only in the proceeds of sale. Once overreaching operated to detach the beneficial interest from the land to the proceeds of sale there is no longer an interest in land capable of being an overriding interest. City of London Building Society therefore took free of the Flegg’s interest.

2. Does the law and policy of land registration conjure a particular idea of what property and ownership mean? Are there alternative ideas? What do you think about property interests requiring entry into a public record in order to be enforceable?...