Modern Land Law, 9th Edition

Students: Chapter 2

Welcome to the Student Resources for Chapter 2 of Modern Land Law. Here you will be able to practice your exam technique with a set of essay questions; check your understanding of what land law is with our multiple-choice quiz and short-answer questions; test yourself on your knowledge of the key statutes and case law; and listen to a short lecture podcast on the latest developments within land law.

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Essay questions

Question 1

In 2007, Mary and Nina became the registered freehold proprietors of 1, The Glebe. Mary contributed 70 per cent of the purchase price from her savings, Nina 30 per cent. They later entered into an oral agreement with Ola that Ola would purchase a third of the property for £100,000. Ola paid the money and moved into one of the rooms but nothing else was done.

In 2009, Mary and Nina decided to sell the property to Paul without telling Ola and entered into a written agreement with Paul. Paul was then registered freehold owner of the property. Mary wants 70 per cent of the proceeds of the sale, but Nina insists that she is entitled to half.

Ola meanwhile is very upset by the sale of the property as Paul will not allow her to go on living in the property. At the time when Paul entered into the written agreement with Mary and Nina, Ola was in hospital and her things had been put into storage elsewhere whilst she was ill. Paul had not been told about Ola and believes that she is not entitled to stay in the property.

Advise generally.

Question 2

What is meant by the mirror, insurance and curtain principles of the Land Registration Act? To what extent does the Act embody these principles?

In 2011, Caroline, the proprietor of No. 23 Puzzle Passage died leaving the property by will to David. Before Caroline died she decided to enter into a number of agreements with her neighbours to ensure that Puzzle Passage remained of the same character. She signed a covenant with her neighbour, Emily, that there would be no development of dwellings in Puzzle Passage. Both Caroline and Emily intended that this would bind any future owners of No. 23, but did not take any action beyond the written agreement. David wishes to build a cottage on his land for his aunt to live in.

In addition, in 2007, Caroline granted Frankie a five year lease of an upstairs flat at No. 23. Caroline promised Frankie that if Frankie helped look after her as she was getting older that Frankie would have a home for life. Frankie did look after Caroline, but as she was a kind person, she did not think much of the promised home for life. David now wishes Frankie to leave.

Caroline, in 2008 had sold part of No. 23 to George. In order to get to the road George had to cross part of Caroline's land. In 2009 George used to use the shortcut from his remaining land to the main road but in late 2009 he ceased to use it this way as another means of access became available to him. He now wishes to use it again, but David is complaining that he should not have to let George use it because there is no physical evidence of the shortcut that can be seen.

Advise David.

True/False Quiz

Answer the questions below based on the facts of this short scenario. In 2003 the registered proprietor of a registered freehold estate, X, died and left all their property to A under their will. In 2005 it was discovered that in fact X had not purchased or been given the freehold estate – he was simply pretending to be the freehold owner. A also granted a lease of two years to go into possession in seven months time to B. They did not register this leasehold estate. In early 2004 A declared in writing that he would hold his entire property on trust for C. In late 2004 A sold his freehold estate to D. D became registered freehold proprietor.

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    Statute Quiz

    Here you should outline the main effect, role, etc. of the provisions below. This is designed as a guide to the most important provisions, and as a means to improve your recall of the statutory provisions.

    Land Registration Act 2002, section 58

    Section 58 operates to guarantee legal title where registered, although this is subject to rectification of the register. Book location: 2.5

    Land Registration Act 2002, Schedule 3

    Schedule 3 lists unregistered rights which override a registrable disposition of a registered estate in land where section 29 Land Registration Act 2002 applies. Book location: 2.6.3

    Land Registration Act 2002, section 28

    Section 28 explains the priority rule where there is a registrable disposition of an estate in land which is not for value. Book location: 2.5.5

    Land Registration Act 2002, section 29

    Collapsible Group Item #1

    Section 29 explains the priority rule where there is a registrable disposition of an estate in land for value. Book location: 2.5.5

    Land Registration Act 2002, section 27

    Section 27 explains the consequences of failing to register a registrable disposition. Book location: 2.5.5

    Case Law Quiz

    Here you should attempt in one or two sentences to outline the main points to be taken from these cases and also three or four key words with their subject matter. This should assist in revision.

    Williams v. Glynn Bank v. Boland [1981] AC 487

    Overreaching, one trustee. Where there is only one trustee the requirements for overreaching will not be met and a purchaser will need to 'look behind the curtain'. Book location: 2.9.3

    Halifax v. Popeck [2008] EWHC 1692

    Purchaser, section 29, fraud. The test as to whether section 28 or section 29 applies is one of substance, not form, and as a matter of substance the transfer in this case is not for value. Book location: 2.5.5

    Baxter v. Mannion [2011] EWCA Civ 120

    Mistake, adverse possession. For the purposes of rectification of the register, 'mistake' covers substantive as well as procedural mistakes. Book location: 2.10.2

    Thompson v. Foy [2009] EWHC 10768

    Actual occupation, overriding interest. The case discusses the requirements of actual occupation under the Land Registration Act 2002. These comments are obiter. It also suggests that actual occupation must exist both at the time of the disposition and at the time of registration. Book location: 2.6.2.2, 2.6.3.2.1

    Abbey National Building Society v. Cann [1991] 1 AC 56

    Actual occupation, registration gap. A caretaker or the representative of a company can occupy on behalf of his employer. It decides also that actual occupation must be judged at the time of the conveyance – not registration. Book location: 2.6.2.2, 2.6.3.2.1

    Short Answer Questions

    What is the role of restrictions under the Land Registration Act 2002?

    Restrictions control the ability of the registered proprietor to deal with their land. They are an indirect means of protecting third party rights and are designed simply to be a means of limiting what the owner can do with their land. Book location: 2.8

    What are the three principles of registered land? Explain briefly what each entails.

    Mirror, curtain and insurance principle. The mirror principle is the idea that the register should be a mirror of all the rights that bind the land and the nature of the ownership. The curtain principle states that the purchaser of land should not have to look behind the curtain of legal ownership and investigate equitable title. The insurance principle is the idea that the owner of land should be compensated when the register is inaccurate. The register guarantees his title. Book location: 2.3

    What are the triggers for compulsory first registration and where can this rule be found?

    Conveyance of the freehold estate; transfer of an existing lease with more than seven years to run; grant of a legal lease of more than seven years; creation of a first legal mortgage over a freehold or a lease of more than seven years. Section 4 Land Registration Act 2002. Book location: 2.4.2

    Is the receipt of rents sufficient to amount to actual occupation for the purposes of Schedule 1 and Schedule 3 of the Land Registration Act 2002?

    No. Book location: 2.6.2.2

    What is a deed, and when is a deed required?

    A deed is a document expressed to be a deed and validly executed as a deed – this means it must be signed and witnessed, and delivered as a deed as per the requirements in section 2 Law of Property (Miscellaneous Provisions) Act 1989.

    Podcasts

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    Podcast Script

    This podcast explains the priority provisions of the LRA 2002.

    The previous podcast in this series gave an introduction to the concept of registered land and gave some indication as to the importance of the concept of registered land in modern land law. This podcast is going to look more deeply at the issue of registration and the specific requirements of the LRA 2002. This Act attempts to provide a comprehensive modern regime of registration.

    The policies behind the systems of registration and the aims of the LRA 2002 are not the subject-matter of this podcast although the general ideas behind registration are often the subject of essay questions and so it is worth familiarising yourself with this material. Instead, here, we will go through some of the specific statutory provisions of the 2002 Act to explain its structure. This should assist you in improving your handling of the statutory material- something that many students neglect. Remember, most Universities let you have a copy of the statutory materials in your exam. It is therefore a great asset to be familiar with and used to handling the provisions in that format.

    The LRA is split into 12 parts and 12 schedules. The first part that we will look at is part 2. It deals with first registration. The events which will trigger a first registration are found in Section 4. The most important are likely to be the transfer of the freehold estate and the grant of a lease for more than 7 years. There are others however and you should look through them. If one of these events occurs, as a result of Section 6, there is a duty to register the interest. If this is not done, as Section 7 explains, then the transfer, grant etc will be, in the statutory language, void with regard to the legal estate. What this means in practice, is that although the equitable interest will be transferred or granted, no such grant or transfer will take place with regard to the legal estate. This has potentially serious consequences for the right holder.

    Sections 11 and 12 then explain the effect of first registration. Registration itself has the effect of vesting the legal title in the proprietor. This will be subject to any pre-existing rights on the register, or any unregistered interests which override in Schedule 1. This means that the new owner of the legal estate will be bound by those rights that are already on the register, and by any rights which override. Nothing else will bind their title. This is the key idea behind registration.

    Part 3 has the same function as part 2, but this time it is concerned with dealings with land that has already been registered. It also outlines also the powers of the registered owner. Section 27, like Section 4, describes the events which trigger registration. As above, the transfer of the legal freehold or the creation of a lease for more than 7 years will be the most common events, but you should make sure you know the other triggering events listed in section 27.

    Section 28 & 29, which explain the priority system for dispositions of registered land, are arguably the most important sections in the LRA. It is therefore useful to go through these in detail.

    (1) Section 28

    This is described as the basic rule. In fact, it is more common to deal with Section 29. Section 28 applies only where there is no valuable consideration given in the transaction. Donees, those who receive gifts, and legatees inheriting under a will will therefore be looked at under Section 28 as they do not provide any valuable consideration.

    In such cases, the application of Section 28 means that the transferee will be bound by any property right which bound the estate before the disposition, whether or not that interest is registered.

    (2) Section 29

    Section 29 is the heart of the registration system. It tells us that where an estate is transferred or created in exchange for valuable consideration, the purchaser of the estate will only be bound by those interests which are either registered, or which override even though they are not registered. The list of interest which will override is found in Schedule 3 and includes (1) legal leases for less than, or equal to, 7 years; (2) the interests of those in actual occupation; and (3) certain legal easements.

    Parts 2 & 3 then have established the system of priorities. Part 4 explains how to protect interests in another person's land. The mechanisms available are the notice, and the restriction. Notices register the interest in question, but not all interests can be the subject of a notice. Restrictions can be used to protect these unregistrable interests. Restrictions can be seen as instructions to the land registry not to register a transfer unless the conditions of the restriction are met. This is a common way of protecting the interests of beneficiaries under a trust.

    These provisions together make the basic idea behind registration possible. In the next podcast, we will look at the position with regard to unregistered land and in particular the concept of land charges. Today's key concepts- section 28 and 29 of the Land Registration Act 2002 and the requirement of registration.