Estates and Interests in Land
Legal estates
PROPRIETARY rights
EQUITABLE interests
Protection in REGISTERED land
Protection in UNREGISTERED land
Freehold
Leasehold
FEE: capable of being inherited
LRA 2002 3 categories of interest
Overriding interests (Schedule 3 LRA 2002)
Equitable interests protected by entry
Registrable dispositions (s. 27(2) LRA 2002)
All other interests are equitable, including:
Restrictive covenants
Estate contracts
Equitable easements and mortgages
Beneficial interests under a trust
MUST be registered in order to take effect
Grant of legal charge
Transfer of registered freehold or leasehold
Express grant or reservation of an easement
Rights of entry (forfeiture)
Leases of over 7 years
NOTICE in CHARGES register of BURDENED land (s. 32 LRA 2002)
Restrictive covenants affecting freehold land
Equitable easements
Estate contracts
Do NOT need to be registered to be protected
Paragraph 3: Implied legal easements and profits a prendre
Paragraph 2: Equitable interests in actual occupation
Paragraph 1: Leases for 7 years or LESS
EQUITABLE rights
LEGAL rights
"Bind the whole world"- Mercer v Liverpool
Rights arising under estoppel claims
Occupation rights under Family Law Act 1996
Legal leases more than 3, up to 7 years (optional)
Protected by RESTRICTION (s.33 LRA 2002)
Beneficial interest under a trust
But can be OVERREACHED
Leasehold estate
Freehold estate
PERSONAL rights
Determining the status of a right in land
- NATURE OF RIGHT: does it satisfy any substantive characteristics
- CREATION: created/ acquired in accordance with the formalities for paticular right
- FIXED LIST: is it on the list of recognised proprietary rights
- PROTECTION OF RIGHT: if proprietary, is it enforceable against third party
Enforced against a third party
Enforced by an action in rem
Bind only the original parties
Enforced by a personal action for damages
SIMPLE: inheritsed by any heir and includes distant relatives
Right of possession which lasts until the owner for the time being dies without heirs, meaning without blood relatives and not disposed by will
ABSOLUTE: estate is not liable to end prematurely, not determinable or subject to a condition
Fee simple absolute in possession (LPA 11925, s. 1(1)(a)
IN POSSESSION: current right to use and enjoyment of the property- physical possession not necessary
FREEHOLD REVERSION: residue of estate after granting lease
LEASEHOLD REVERSION: residue of the leasehold estate after granting sub-lease
Lesser estate of certain duration
Term of years absolute (LPA 1925, s. 1(1)(b))
Commonhold
Created out of a freehold registered estate
NO OVERALL LANDLORD
Designed to meet the needs of owners of flats or apartments where the owners are interdependent on each other e.g. retirement home
Owner of each flat is a member of the association
COMMONHOLD ASSOCIATION: freehold owner of property in the form of a company
Commonhold association responsible for maintaining the communal areas
Listed in s. 1 LPA 1925
Licence
LEGAL interests
EQUITABLE interests
Easements granted for a term equivalent to a freehold or leasehold estate
Mortgages
Rights of entry
Estate contracts
Beneficial interests in a trust of land
Freehold covenants
Easements granted for an uncertain term
Transfer
Will
Gift
Sale
Operation of law (automatic transfer in certain situations e.g., bankruptcy)
- COMPLETION OF THE DEED (s.52(1) LPA 1925)
- REGISTRATION
- EXCHANGE OF CONTRACTS
Parties become legally committed to buy/ sell the land
Voluntary and NOT legally necessary
Buyer pays a deposit to the seller
Occurs by way of DEED (written legal document)
CONVEYANCE in UNREGISTERED land TRANSFER in REGISTERED land
Requirements of valid deed s. 1 LP(MP)A 1989
REGISTERED land: legal title does NOT transfer until registration s. 27(1) LRA 2002
UNREGISTERED land: first registration within 2 months of completion, OR legal title revert back to seller (ss. 4 and 6 LRA 2002)
Register deed at Land Registry
Comply with LP(MP)A 1989, s. 2
Include all expressly agreed terms
Signed by BOTH parties
Writing
Validly executed
Deliverered
Clear intended to be a deed
TR1 prescribed by Land Registry
LABEL it a deed
Signed by SELLER in presence of witness
Witness sign deed confirm attested the deed
DATING the documents
Pay purchase money and hand keys over to buyer
UNREGISTERED land: LEGAL TITLE PASSES (trigger requirement to register- ss. 4 and 6 LRA 2002)
Whenever a material term is varied variation comply with s. 2 LP(MP)A 1989
Binding law contract passes EQUITABLE interest
Application
Option Agreement
Right of pre-emption
An "agreement for lease" OR "contract for lease"
Sale contract
Courts recognise EQUITABLE interest in land if:
Document complies with s. 2 LP(MP)A 1989
Remedy of SPECIFIC PERFORMANCE available
Remedies for BREACH of land contract
Specific performance
Injunction
Damages
Principles of registration
- The CURTAIN Principle
- The INSURANCE Principle
- The MIRROR Principle
Buyer should be bound only by third party interests already entered on the register at the time of sale
Simplify and cut down the costs of conveyancing
Register should be a CLEAR and COMPREHENSIVE account of the ownership and rights that benefit and burden land
Never fully realised due to OVERRIDING INTERESTS
Register should REFLECT all maters
Need not be concerned of beneficial or equitable ownership of land under trust
Register records ownership of legal estate in the property- LEGAL title
Error will be corrected and COMPENSATED (s. 23 LRA 2002)
"State indemnity"
Accuracy is guaranteed by state
Classes of title
QUALIFIED
GOOD LEASEHOLD
ABSOLUTE
Best form of ownership
Title has some defect
Satisfied as to the title of the leaseholder only
POSSESSORY
May be given to those with a claim under "Adverse Possession" or "Squatters Rights"
Land
LOWER airspace: that portion of airspace which is necessary for the ordinary use and enjoyment of the land (INJUNCTION if breached)
UPPER airspace: does NOT constitute trespass (s. 76(1) Civil Aviation Act 1982 grants immunity from trespass/ nuisance for innocent flight/ aircraft)
Statutory definition s. 205(1)(ix) LPA 1925
Landowner owns EVERYTHING beneath the surface of land
NOT entitled to minerals under land- belongs to Crown (Treasure Act 1996)
NO trespass at depths below 300 metres (s. 43 Infastructure Act 2015)
Any COAL belongs to Coal Authority (Coal Act 1938))
FIXTURES
PURPOSE annexation is BETTER ENJOYMENT of chattel, remain a CHATTEL
Chattel incorporated into ARCHITECTURAL DESIGN classified as FIXTURE even though NOT firmly affixed
Chattel cannot be removed without DESTRUCTION/ DEMOLITION will be FIXTURE
s. 62 LPA 1925 conveyance includes ALL FIXTURES unless excluded from sale in contract (s. 62(4) LPA 1925)
Legal test
- Degree of annexation test
- Purpose of annexation test
Rests on land by its own weight, CHATTEL
More firmly object fixed to land/ building more likely a FIXTURE
WHY object attached to land/ building
Annexation more convenient use or enjoyment of chattel as chattel, or enhance land/ building
TAKES PRIORITY over other test
Complete a Law Society Fixtures and Contents Form (Form TA10)
s. 28 LRA 2002: an interest whatever kind will take priority over later dispositions
s. 29 LRA 2002: a registrable disposition of a registered estate, made for valuable consideration, will take priority over any pre-existing rights in the land except those which protected by notice or overriding interests
Donees take land subject to ALL pre-existing interests, irrespective of whether they have been protected by registration (s. 28 LRA 2002)
Equitable leases
Options to purchase
Equitable interests under trusts of land
Interests arising by way of estoppel
Actual occupation:
Actual occupation at the TIME of TRANSFER DEED and possibly also TIME of REGISTRATION
NOT defeated by temporary absences e.g. hospital stays, holidays, business trips (prolonged absence might defer)
Must be "permanence and continuity" not simply a "mere fleeing presence"
EXCEPTIONS
Schedule 3 paragraph 2(b)
Schedule 3, paragraph 2(c)
Inquiry made BEFORE disposition and HOLDER of interest FAILED TO DISCLOSE when REASONABLY expected to
OCCUPATION was not obvious with reasonably careful inspection, and the person whom disposition made does NOT have ACTUAL KNOWLEDGE
New owner KNEW about it
New owner did NOT know but OBVIOUS on reasonable inspection of land
Exercised within 12 months immediately BEFORE disposition
EPITOME OF TITLE: bundle of relevant copy documents
DEDUCING TITLE: on a sale, seller required to show epitome of title to buyer
PRE-1926
POST-1926
DOCTRINE OF NOTICE
Equity's Darling: bona fide (good faith) purchaser for value of a legal estate in the land without notice of the prior interest TAKE LAND FREE
Doctrine of Notice
REGISTRATION AS LAND CHARGE under Land Charges Act (LCA) 1972
Exception: "PUISNE" MORTGAGE (second legal mortgage)
Must be registered as a Land Charge
Equitable easements and restrictive covenants BEFORE 1926
Equitable interests under a trust NOT overreached
Entered against the NAME IN THE TITLE DEEDS (rather than name as appears in other contexts)
Failure correct name UNENFORCEABLE and NOT BIND new owner of BURDENED land
Class C(IV): Estate contract
Class C(I): Puisne mortgage
Class D(II): Restrictive covenants AFTER 1926
Class F: Spouse's Matrimonial Right of Occupation
Class D(III): Equitable easement AFTER 1926
Contract to buy land
Option to purchase
Contract to have a lease
Non-protection of an interest make it VOID AGAINST A PURCHASER of land, but NOT AGAINST SOMEONE GIFTED/ INHERIT land
PURCHASER: acquires an interest in land otherwise than by operation of law
VALUE: money or money's worth or future marriage
LEGAL ESTATE: freehold or leasehold estate (or charge by way legal mortgage)
WITHOUT NOTICE: actual, constructive or imputed notice
BONA FIDE: buyer must act in good faith
IMPUTED notice: s. 199(1)(ii)(b) notice received by buyer's agent
CONSTRUCTIVE notice: s. 199(1)(ii)(a) purchaser act as prudent person
ACTUAL notice: purchaser actually knows