Land Law

Q&A Land Law

Martin Dixon, Gerwyn Griffiths and Emma Lees

Q&A Land Lawcards 2012 - 2013

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The Good, the Fair and the Ugly

Good essays are the gateway to top marks. New to this edition, The Good, The Fair, and The Ugly shows you the style of essay which works well in exams, as well as the simple errors that can cost you essential marks. Written by our Q&A authors, each of these interactive essay-based tutorials highlights key themes and common errors and illustrates essays of specific standards:

Whilst marking criteria will vary, as a general guide, the Good answer will be based on a general mark of a first or upper second class; the Fair answer will be based on a lower second or third class and the Ugly answer would result in a fail.

The Good

Jeremy, Keith and Lucy, good friends at university, agreed after they graduated in 2009 to club together to buy a house in London. Malcolm, an uncle of Lucy, had recently moved into sheltered accommodation and offered to sell his house to her for £200,000, a price which represented a £25,000 discount on the market value at the time. The friends were delighted. Jeremy contributed £25,000 in cash and Keith contributed £25,000 that he obtained from his father, Freddy. The balance of the purchase price, £150,000, was raised by way of mortgage with Southern Rock Bank. At the bank's insistence, the house was registered in the joint names of Jeremy, Keith and Lucy, with each of them undertaking joint and several liability for the mortgage repayments.

Malcolm hated life in sheltered accommodation, and in 2010 he moved back to the house, living in an extension that was built using some of the money he had received from the sale of the house in 2008. Keith initially objected to the arrangement, saying that the presence of an elderly man would cramp their lifestyles, but reluctantly accepted when Jeremy and Lucy insisted and pointed out that the extension would increase the value of the house.

Keith has suddenly disappeared without telling anyone he was leaving. The others have just discovered that some months ago Keith forged the signatures of Jeremy and Lucy on a mortgage in favour of Tealeaf Building Society to secure an advance of £250,000. Part of this money was used to redeem the mortgage in favour of Southern Rock Bank; the rest has vanished with Keith.
Jeremy, Lucy and Malcolm cannot afford to shoulder this unexpected debt and are fearful of losing the house.

Advise them as to their legal position.

Podcast: the Good

The transfer of legal title to J, K and L will mean that they are trustees of the legal title to the house, by virtue of a statutorily imposed trust of land, according to sections 34 and 36 of the LPA 1925. Co-ownership of the legal estate can only take the form of a joint tenancy (section 1(6) LPA). However beneficial ownership can exist as a joint tenancy or a tenancy in common. There does not appear to be any express declaration by the parties regarding their respective beneficial interests. It is therefore necessary to consider the nature of the arrangement in order to determine the allocation of beneficial ownership of the property, through the operation of implied trusts. If the arrangement is a commercial one, the doctrine of resulting trust is more likely to give effect to the presumed intention of the parties to acquire beneficial ownership in accordance with their respective financial contributions, unless there is evidence capable of rebutting the presumption (Laskar v Laskar). However it is submitted that the arrangement is a domestic rather than a commercial one, on the basis that J, K and L appear to have purchased the property for their private occupation, as opposed to buying it for business or investment purposes. (1) The question begins with a short, but informative introduction to the general area of law covered by the question. The Examiner knows what the candidate intends to do.

The question of beneficial ownership of the property must therefore be considered in the light of Stack v Dowden. The starting point based on the approach adopted by Baroness Hale in Stack, is a presumption that, in the domestic context, equity follows the law and therefore that beneficial ownership should follow the legal ownership. There is therefore a prima facie presumption that J, K and L are joint tenants in equity. The presumption is rebuttable if one party can establish that the parties intended beneficial ownership to differ from legal ownership, although Lady Hale was of the opinion that the presumption would only rarely be rebutted. (2) Case law is introduced early and the answer gives the leading case with some detail. Note that there is no re-telling of the facts, but an analysis of the point of law.

J and K may seek to rebut the presumption of joint beneficial ownership and claim a larger beneficial entitlement than L in order to reflect the fact that they made an additional £25,000 contribution to the purchase price.(3) The law is applied to the facts. No assumptions are made. On the other hand, Lucy might argue that the “discount” she was able to obtain for them was itself a contribution to the purchase price (see Mumford v Ashe).(4) The answer discusses possible alternatives, revealing a wide understanding. In fact, Lady Hale was clear in Stack that the presumption of beneficial joint ownership cannot be rebutted simply because one party made a larger financial contribution to the acquisition of the property than the other and held that the court’s task is to search for the result that the parties must, in light of their conduct, be taken to have intended. The burden will be on J and K to establish that there was a common intention that the beneficial interests would be different from their legal interests. In this regard, Lady Hale included a list of factors which would be relevant to determining the parties’ true intentions, which include the reasons why the property was acquired in joint names, how the acquisition was financed, the nature of the parties’ relationship and the way in which household expenses were discharged (see judgment at para. 69).(5) Where the question raises issues connected to a leading case, a discussion of the judgments, as opposed to a general discussion of the points it raises will always earn more marks.

In our case, the parties were forced to acquire the house as joint legal owners in order to obtain the mortgage, the nature of their relationship was merely one of friendship and it appears likely that they maintained separate bank accounts and allocated household expenses individually. One of the parties also made a significantly lesser financial contribution than the others, but this might be counteracted by a contribution in kind. In Stack the presumption was rebutted after finding that the parties had never pooled their resources, took separate responsibility for the household expenses and one party made a significantly larger financial contribution than the other, despite the lengthy cohabitation of the parties. It is therefore submitted that the presumption is also likely to be rebutted in our case, where the case for rebuttal appears to be more persuasive than in Stack. Therefore J and K may be entitled to a larger share of the beneficial ownership than L. However the legal status of the reduced purchase price of the house is important in assessing beneficial ownership of the property. The £25,000 reduced price may have been a gift to L, in which case it may constitute a direct financial contribution to the purchase price by L (Ashe) and reduce the likelihood of J and K being able to rebut the presumption of beneficial joint tenancy, or at least render quantification of the tenancy in common likely to be in equal shares. AS for M, he would not have a beneficial interest in the property if the £25,000 is deemed to be a gift to L.

Alternatively, the £25,000 may be regarded as a direct contribution to the acquisition of the house by M. The contribution by M may be considered to be a commercial arrangement on the basis that M did not intend to live in the house and may have regarded the acquisition of the property as an investment. The fact that L and M have a family relationship will not by itself put the transaction within the domestic context, as demonstrated by Laskar v Laskar. If the arrangement is a commercial one there will be a presumption of a resulting trust whereby M will be presumed to have acquired a beneficial interest in accordance with his direct financial contribution. In Farrar v Farrars Ltd the Court of Appeal held that a sale by a person to himself is no sale at all (see also HSBC v Dyche), therefore M would be unable to acquire legal ownership of the property. However by virtue of the operation of implied trusts M will still be able to acquire a beneficial share in the ownership of the property. Note, however, that the erection of the extension to the property by M was not a contribution to the acquisition of the property; therefore it will not give rise to a presumption of a resulting trust. Thus, if the original contribution merely gives rise to a resulting trust the contribution made via the extension will not be relevant to determining M’s beneficial entitlement to the property.

If, contrary to the above, M’s contribution to the purchase price was a domestic arrangement (e.g. the property was not rented and did not provide any income for M), it is submitted that the property may have been brought to provide a home for a member of the family and potentially for himself in the future. If it could be established that the arrangement was a domestic one, the direct contribution to the acquisition of the house would readily justify the presumption of a common intention constructive trust according to Rosset, in the absence of evidence of the parties’ intentions to the contrary. Once a constructive trust has established that M has a beneficial interest, Stack determines that quantification of the interest is to be determined by reference to what the parties must be taken to have intended in light of their conduct (but cf. Jones v Kernott where the Court of Appeal took a more limited view). (6) Notice how conflicting case law is discussed, not ignored. Therefore the construction of the extension will be able to be taken into account during quantification and is likely to increase the size of M’s beneficial entitlement to the property.

On balance, it is my view that the contribution to the original purchase price was in fact more akin to the domestic context than the commercial one. It is also submitted that the contribution is unlikely to be considered a gift because of the significant size of the sum and the relatively modest financial position of M. Therefore the extension will be relevant to the quantification of M’s beneficial interest.

Baroness Hale in Stack expressly recognised that whatever the parties’ intentions may have been at the time of acquisition, these may have changed following the construction of an extension to the property and a common intention may have arisen for beneficial entitlement to differ from what it was originally. M may therefore be able to establish that a common intention trust arose at the time of the extension under which he was intended to acquire beneficial ownership. It remains unclear following the decision in Stack whether an indirect financial contribution such as the extension to the house will constitute a sufficient basis from which to infer a common intention. Lord Bridge in Rosset was of the opinion that nothing less than a direct financial contribution would be sufficient but there are dicta in Stack from Lord Walker indicating that the law has moved on from this position (see also Abbott v Abbott)

However decisions following Stack have adopted a strict approach to what will constitute sufficient conduct to merit the inference of common intention. The court in James v Thomas for example held that the cohabitant’s labour which contributed to the improvements of the house was wholly explicable on other grounds, because of the nature of the relationship between the parties and therefore determined that she had no beneficial interest. It is submitted that the court in our case may distinguish James and be more willing to conclude that there is a sufficient basis for the inference of a common intention constructive trust, on the basis that there is no suggestion the extension was built in furtherance of the parties’ relationship. Sir Peter Gibson in Morris v Morris spoke in terms of conduct which could only be explained on the footing that the claimant believed they were acquiring an interest in the land. In our case it may be considered that the only rational explanation for M’s financing and building the extension to the property was on the basis that he believed he was acquiring a beneficial interest in the land and therefore found an inference of common intention. However Stack is clear that the intention must be common to all of the parties in order to establish a constructive trust. The reluctance of K to allow M to move in and his reluctant acquiescence based only upon his belief of the increased value of the house for the legal owners, may rebut the presumption of a common intention that M should acquire beneficial ownership by virtue of his indirect financial contribution, even if this can be established to be sufficient.

The legal effect of the forgery of J and L’s signatures in order to obtain the mortgage must now be considered. The forgery means that the intended legal charge to the Building Society will be incapable of creating a legal mortgage (First National Bank v Achampong). K does not have the power to convey legal title to the whole estate without the agreement of all the legal owners. The attempted mortgage is however capable of creating a mortgage of K’s equitable interest in the property (section 63(1) LPA and Bankers Trust Co v Namdar). K’s equitable share in the property will therefore provide security for the additional money which K has retained for himself after repaying the original mortgage. K alone will be responsible for repaying this additional sum. If J, K and L were held to be joint tenants in equity previously, which it is submitted is unlikely anyway, the equitable mortgage would certainly have the effect of severing the joint tenancy in respect of K, whilst J and L would remain joint tenants (Achampong). (7) Once again, the application of the law to the facts is analysed in some detail and, importantly, supported by references to case law.

The operation of subrogation will mean that the Tealeaf Building Society (T), as a third party, who has paid off the original mortgage, will be presumed unless the contrary appears, to intend that the mortgage shall be kept alive for their own benefit (Ghana Commercial Bank v Chandiram, Equity & Home Loans v Prestridge)). It is therefore submitted that J and L will be liable for the repayment of the original debt to Tealeaf Building Society, although not for the additional amount that was kept by Keith once the mortgage had been discharged. The operation of subrogation will mean that T will have the same priority of title as the original mortgagee and will be referred to as the mortgagee in discussion of the priorities of the parties.

The relative priorities of each of the parties with a beneficial interest in the property must now be considered because T will only be able to take possession in respect of any person over whom it has priority - taking possession will be important if T is to realise the full value from the sale of the house in the event of default. T is unable – in the absence of a legal charge – to secure possession and sale as of right, so it will have to apply under section 14 TOLATA 1996 as a “person interest”. In respect of such an application, the court must consider the factors listed in s.15 of the Act and may well order sale (Bank of Ireland v Bell), although it is possible that they might postpone sale in the light of the use still being made of the property by the other co-owners (Mortgage Corporation v Shaire). (8) The answer is detailed, not general. Empty statements are avoided.

In conclusion, J, K and L were the original legal and beneficial owners of the property and it appears that they were tenants in common in equity owing to the rebuttal of the presumption of joint tenancy in the domestic context by virtue of the facts of their relationship. It appears that M also had a beneficial interest on acquisition of the house by virtue of a common intention constructive trust or alternatively possibly following the construction of the extension to the property. By virtue of the forged mortgage, T has a mortgage over K’s equitable share of the property to the extent of the surplus money following repayment of the original mortgage. By virtue of subrogation T will also be entitled to repayment of the original mortgage from J, L and M which will be secured on the property. T will have to apply for an order for sale, although the balance of authority suggests that such an order will be granted. (9) The answer reaches a conclusion and the Examiner knows that the candidate has good understanding of this area of the law. Even if the precise details of the answer are wrong, the answer reveals that this is a candidate who has come to grips with the topic.

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The Fair

Advise them as to their legal position.

Podcast: the Fair

The transfer of legal title to J, K and L will mean that they are trustees of the legal title to the house, by virtue of a statutorily imposed trust of land. Co-ownership of the legal estate can only take the form of a joint tenancy (section 1(6) LPA). However beneficial ownership might be able to exist as a joint tenancy or a tenancy in common. I am going to assume that there is no declaration by the parties regarding their interests and so everything now depends on the facts. This looks like a domestic arrangement and so Stack v Dowden applies to it.(1) There is no attempt to introduce the topic and the answer "jumps in" to the problem without evidence of thought or structure. The candidate makes the great error of assuming something. "I am going to assume" are words that should never be written in a land law answer.

In that case, which concerned an unmarried couple with the man (unusually) trying to claim a larger share, the House of Lords said that equity follows the law. There is therefore a presumption that J, K and L are joint tenants in equity. The presumption will give way if one party can establish that they intended the beneficial ownership to be different from the legal ownership. (2) There is no case law, no analysis and no detail. For all the Examiner knows, this could be made up.

J and K may try to claim a larger share than L in order to reflect the fact that they made an additional £25,000 contribution to the purchase price. The judges in Stack(3) The candidate gives no analysis of Stack, nor explains its significance. suggested that this depended on all the facts, (4) It could be said of most legal problems that they "depend on the facts". This is a frequent error made in examinations and gives the impression that the candidate does not understand the principles behind the law. To say that "the judge must decide" or "it depends on how the facts are viewed" is not a substitute for you're your own analysis. It makes the answer appear weak. which included how much money that had paid for the house. It is up to J and K to prove that they have a larger share based on all these facts. I think it is likely that J and K will have a larger share because it does not seem fair that they have the same as Lucy when they paid more money. (5) What are the reasons for this conclusion, and what case law supports it? General unsupported statements gather very few marks. L might argue that she has also done a lot – by getting her uncle to sell them the house – but it is not certain that this will count. (6) Again, why and on what basis? Therefore J and K may be entitled to a larger share of the beneficial ownership than L. In fact, it is possible that M (the uncle) might(7) This gives the impression of uncertainty – what conclusion do you reach, and why? be able to claim a share because he sold them the house cheaply and he paid for the extension. In a number if cases,(8) References to "a number of cases" does not impress an examiner: it could be said of everything! Case names must be given, although there is usually no need to recite the facts. this has been found to be sufficient to get an interest in property. Cases after Stack have tried to apply the law to a range of different situations but they have not been consistent. (9) Give examples. Consequently, the judge will have to decide. Overall, I think that J and K have a larger share than L and that M also has a share. The house is held on trust for all of them.

When the house is mortgaged by K, this is a fraud because the others have not signed the mortgage. This means that the Building Society have a problem because they cannot obtain priority over J and L and M. They will have to sue K, if they can find him. It might be possible for the Building Society to argue that they do have a mortgage over K’s share in the land, but this is not worth very much as he only owns part of it – see Ahmed v Kendrick. The Building Society will want to get their hands on the property in order to sell it, but because they don’t have a legal mortgage, this is going to be difficult. They can apply to the court for an order for sale, but because they do not have a mortgage over all of the property, this is not likely to succeed. (10) This is probably the best part of the answer. Accurate and with some case law. Of course, it could be more precise.

Because of K’s fraud, J and L and M are lucky because they may be able to stay in the property. Keith owes the Building Society a large amount of money and they can make him bankrupt. If they do, they might have a better chance of selling the property – see the Insolvency At 1986 and Slayford. (11) Failure to mention relevant statute law – here TOLATA 1996 – creates a very poor impression. This is especially so if you have been permitted to take the statute book in to the examination with you.

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The Ugly

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Lawcards

Revision Checklist

Chapter 1: Fundamental concepts

Definitions of Land
Concept of Property
Test for fixture or chattel
Concept of tenure and estates
Concept of rights, estates and interests
Concept of notice
Concept of fee simple absolute in possession
Requirements for a valid contract for sale
Requirements for a valid conveyance of land

Chapter 2: Conveying title to land with unregistered title

Legal and equitable interests in unregistered land
Overreaching beneficial interests in unregistered land
Registration of Land Charges
Land Charges Register
Residual interests

Chapter 3: Transferring title to land with registered title

Conveyancing process
Principles underlying registered land
Property, Proprietorship and Charges register
Interests in registered land
Registrable interests
Classes of title
Minor interests: methods of protection
Overriding interests
Alteration and indemnity of the register

Chapter 4: Adverse possession and boundaries

Factual possession
Animus possidendi
Adverse possession of land with registered title before 13 October 2003
Adverse possession of land with registered title after 12 October 2003
Adverse possession and leasehold land
Boundaries
Party Wall etc Act 1996

Chapter 5: Trusts of land

Express trusts
Statutory trusts
Implied trusts
Trusts of land pre-1997
Trusts of land post-1996
Powers of the trustees
Beneficial interests
Beneficial tenancy in common
Severance
Rights of the beneficiaries
Sale of the trust land
Termination of a trust of land

Chapter 6: Resulting trusts, constructive trusts, proprietary estoppel and licences

Resulting trusts
Constructive trusts
Overreaching an interest in land subject to resulting or constructive trusts
Proprietary estoppel
Comparison of rights
Licences

Chapter 7: Leases

Concept of a lease
Creation of leases and formalities
Protection of a lease
Essential requirements of a lease
Lease/licence distinction
Social housing
Leasehold covenants
Enforcement of covenants pre-1 January 1996
Enforcement of covenants post-31 December 1995
Landlord's remedies for breach of covenant
Tenant's remedies for breach of covenant
Methods of terminating leases

Chapter 8: Mortgages

Creation of legal mortgages
Creation of equitable mortgages
Equity of redemption
Undue influence and misrepresentation
Remedies of the mortgagee
Protection of mortgages

Chapter 9: Easements and profits a prendre

Definition of an easement
Characteristics of an easement
Examples of common easements
Creating an easement by grant
Implied grant of necessity
The rule in Wheeldon v Burrows [1879]
Law of Property Act 1925, section 62
Prescription
Reservation of easements
Protection of easements
Alteration and extinguishment of easements

Chapter 10: Freehold covenants

Definition of a freehold covenant
Original parties
Running the benefit of covenants at law
Running the benefit of a covenant in equity
Running the burden of a covenant at law
Running the burden of a covenant in equity
Positive covenants
Discharge and modification of covenants
Remedies for breach of covenant

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Glossary

Click on the glossary term to see the definition

Chapter 1

Fixture: Item which has become part of land through attachment to it. Section 62(1) LPA 1925 tells us that all fixtures are conveyed with the land, unless there is a contrary intention expressed in the conveyance.

Chattel: The name given in law to things that are personal property. Chattels can be divided into chattels real and chattels personal.

Real property: Freehold land and any buildings on it

Estate: Ownership of land (freehold or leasehold)

Fee simple absolute in possession: freehold estate which lasts for ever

Term of years absolute: Also known as a leasehold. One of the two legal estates in land found under S 1(1) LPA 1925. An estate in land for a period less than a freehold. A term of years absolute will last for a determinate period such as a week, a month, or a thousand years

Conveyancing: the legal and administrative process of transferring ownership of land or buildings on it from one owner to another

Land

"Land" includes land of any tenure and mines and minerals, whether or not held apart from the surface, buildings or parts of buildings... and other corporeal hereditaments; also a manor, an advowson, and a rent and other corporeal hereditaments, and an easement, right, privilege, or benefit in, over or derived from land..."

S 205)1) (ix) LPA 1925, amended by Sched 4 to the TOLATA 1996.

Land includes-

buildings and other structures
land covered with water, and
mines and minerals, whether or not held with the surface"

(Section 132(1) LRA 2002

Hereditament: Real property which is capable of being inherited

Contract: Any legally binding agreement; contracts for any transaction relating to land must (with very limited exceptions) be in writing, contain all agreed terms, be signed by both parties (S.2 Law of Property (Miscellaneous Provisions) Act 1989)

Deed: Legal document complying with the formalities under S.1 Law of Property (Miscellaneous Provisions) Act 1989 (must state that it is a deed, be signed by the person making it and a witness to the signature)

Chapter 2

Legal Interest

aside from the two legal estates, there are 5 other rights which can be created at law (S 1 (2) LPA 1925. These are

Easement;
Rentcharge;
Charge by way of legal mortgage;
Any other similar charge created by instrument;
Rights of entry exercisable over a legal lease or rentcharge

Equitable Interest: All other estates, interests and charges in or over land take effect as equitable interests (S.1 (3) LPA 1925

Charge: any right over, or interest in, freehold or leasehold land which belongs to any person other than the owner of the land in question; normally used for a mortgage

Title deeds: deeds and other documents which prove ownership of freehold or leasehold property, consisting of all document transferring ownership successively from one owner to the next; used by the seller to prove his ownership where land does not have registered title

Equity's darling: A person who is a bona fide purchaser for value without notice of an equitable interest.

Doctrine of notice: Awareness of some event or state of affairs.

Constructive notice: The purchaser will be fixed with such notice if he could have discovered an interest by making appropriate enquiries, for example examination of deeds and inspection of land. Constructive notice applies only to residual interests in unregistered land. S. 199 LPA 1925. See Kingsnorth Trust Ltd v Tizard [1986] 2 ALL ER 54

Imputed Notice: The purchaser will be regarded as having notice of any matter which has come to the knowledge of the solicitor or agent had that person made such enquiries as should reasonably have been made. S. 199 (1) (ii) (b) LPA 1925.

Overreaching: The process whereby the rights of beneficiaries under a trust are swept off of the land and transferred to the capital monies. In order to overreach successfully a receipt for capital money must be obtained from at least two trustees of land or a trust corporation.

Chatpter 3

Filed plan: The official Land Registry plan by reference to which a piece of land with registered title is identified

Good leasehold title: One of the grades of leasehold title which may be granted to leasehold land by the Land Registry on registration

Land Registry: A government department (head office in London and district registries in other places in England and Wales) responsible for registering title to land when it become subject to first registration, maintaining the land registers, recording transactions and dealings with registered land, issuing results of public searches in the land registers

Overriding interest: An overriding interest only relates to land with registered title; it is a right which is enforceable against a property, and binding on a buyer, transferee or lender, even thought the right is not referred to on the register of the property at the Land Registry

Property register: One of the three registers (with the proprietorship and charges registers) maintained by the Land Registry for any piece of land with registered title this register describes the property and any rights attached to it, and whether it is freehold or leasehold

Proprietorship register: One of the three registers (with the property and charges registers) maintained by the Land Registry for any piece of land which registered title this register states the name of the current registered owner and the grade of title which the property has

Charges register: One of the three registers (the others are the property register and the proprietorship register) maintained by the Land Registry for any piece of land which has registered title; the charges register records any third party rights and interests over the piece of land

Registered proprietor: The person who is recorded at the Land Registry as the owner of any piece of land which has registered title

Registered title: Ownership of freehold or leasehold property which has been registered at the Land Registry (which then guarantees the ownership and contents of the register as accurate)

Chapter 4

Adverse possession: Acquiring ownership of land through possession, rather than transfer from the owner

Limitation: time period within which legal rights must be asserted through court proceedings under Limitation Act 1980.

Powell v McFarlane (1977)

Sets out the two requirements that the squatter must satisfy for adverse possession

Factual possession of the land for the limitation period; and
Animus possidendi - the intention to possess

Pye (JA) (Oxford) Ltd v Graham [2002]: The court held that the willingness of the squatter to pay the paper owner if asked would not defeat a claim for adverse possession.

Schedule 6 LRA 2002

Lays down the rules relating to adverse possession for registered land since 13 October 2003. In summary the rules are

The squatter will not acquire title to the land until he has registered his title
The squatter may apply to register his title following a period of 10 years adverse possession

Chapter 5

Trust: situation where land is held in the name of one person (trustee), on behalf of others (beneficiaries).

Strict settlement: Under Settled Land Act 1925 the strict settlement dealt with successive interests. The legal estate was held by the tenant for life who held for the beneficiaries in remainder.

Trust of Land: Since 1 January 1997, it has been possible to create only one type of trust of land. Section 1 of TOLATA 1996 provides that "trust of land" means... any trust which consists of or includes land...

Trustee: A person in whose name the property has been put, but who holds it for the benefit of another person (the beneficiary)

Co-ownership: where two or more people own land together - see "joint tenants" and "tenants in common"

Joint tenant: One of the two forms of ownership (for freehold or leasehold land) applicable where two or more people own a property together; (the survivor of joint tenants becomes the tenant of the whole).

Tenants-in-common: one of the two forms of ownership (for freehold or leasehold land) applicable where two or more people own a property together; tenants-in-common have separate shares in the property and there is no right of survivorship (unlike joint tenants).

Severance of joint tenancy: A joint tenancy can be severed in writing (S. 36(2) LPA 1925) or in equity (S 36(2) LPA 1925. See Williams v Hensman (1861)

Chapter 6

Resulting Trust: a resulting trust of land arises by way of presumption. The presumption is raised by contributions towards the purchase price of the land, which can include an contributions to a mortgage from the outset.

Constructive Trust

person may claim an interest in land if he can satisfy three requirements ( Lloyds Bank plc v Rosset (1991)), these are

A common intention that they were to benefit;
Detrimental reliance upon the common intention;
Unconscionability on the pat of the legal owner

Detrimental reliance: In respect of a constructive trust, evidence must be provided that a person has relied on a common agreement and changed his or her position in reliance on the agreement. It may include a financial contribution to the property, or home improvements.

Proprietary estoppel: A representation by one person to another that he/she has rights in property cannot later be denied where the representation has been acted upon. The person who relies on the representation must show that he has acted to his/her detriment.

Chapter 7

Landlord: The person who has granted a leasehold or who currently owns the freehold of the property out of which the leasehold was granted

Leasehold: Ownership by way of occupation of another's property for a fixed number of years (or on a periodic basis) usually in return for a rent; granted by a document called a "lease" (or "tenancy agreement" in the case of a period for under three years). See sectuib 205(1) (xxvii) LPA 1925.

Leaseholder: Person who owns a leasehold estate, either through direct grant to him by landlord or through transfer of lease to him; also known as "the tenant" or "the lessee"

Lessee: The leaseholder; alternative word for "tenant"

Lessor: Alternative word for landlord

Licence

A personal permission to enter or occupy another person's property. A licence is not an interest in the land. There are four categories of licence

Bare licence
Licence coupled with an interest
Contractual licence
Estoppel licence

Privity of contract: Prior to 1 January 1996 the original landlord and tenant would be in privity of contract and could sue each other on the contract. The original tenant could be liable under privity of contract throughout the original term of the lease, even after assignment. The original landlord could also be liable throughout the term of the lease, even after assignment of the reversion

Privity of estate: Assignees will be liable for breaches in covenants under privity of estate. Privity of estate will exist between the persons who are currently in the position of landlord and tenant.

Chapter 8

Mortgage: loan for which land is security a mortgage gives the lender rights over the land

Mortgage deed: the document containing the mortgage agreement and conditions

Mortgagee: one who lends money on the security of a mortgage or legal charge

Mortgagor: one who borrows money for which he pledges his land as a security

Equity of redemption

The right of the mortgagor to pay off the mortgage and get the property back in its original state. The most notable rights are

there should be no clogs or fetters on the equity of redemption
there should be no unreasonable postponement of the right to redeem
there should be no unfair collateral advantages

Right of possession: Legal mortgagees have a right to possession as soon as the mortgage deed is executed. Residential occupiers have statutory protection under the Administration of Justice Act 1970 s36. Unless the mortgagor is in default and the mortgagee wishes to obtain vacant possession pending sale of the property, possession is unlikely to be sought.

Power of sale the power of sale

the exercise of a mortgagee's power of sale is governed by the LPA 1925 ss101-107. Section 101 states that the power of sale must have arisen This means

the mortgage must have been made by deed; and
the mortgage money must have become due; and
there must have been no provision excluding sale in the mortgage agreement

Administration of Justice Act 1970 s36

Where the mortgagee under a mortgage of land which consists of or includes a dwelling house brings an action in which he claims possession of the mortgaged property, the court may exercise any of the powers set out below, if it appears to the court that in the event of its exercising the power the mortgagor is likely to be able within a reasonable period to pay any sums due under the mortgage.

The court

ay adjourn proceedings, or
stay or suspend execution of the judgment or order, or
postpone the date for delivery of possession, for such period or periods as the court thinks reasonable.

Chapter 9

Easement: a right over another's land, such as a right of way or right of light

Dominant tenement: land which benefits from an easement

Servient tenement: land subject to easement

Profit a prendre: These are rights to take part of the soil, plants, minerals, or wild animals from the servient tenement. Anything which may be owned may be granted as a profit provided that it is found on the servient land or in its waters. Profits can exist either appurtenant to land or in gross. Some examples of profits are; profits of turbary (rights to dig peat), profits of piscary (rights to fish), and profits of estovers (rights to take wood).

Prescription

Prescription gives effect to the claims of a user over long periods of time. There are three requirements which need to be satisfied before a prescriptive right can be acquired

the user must be the fee simple owner
the user must be continuous
the user must be as of right

common law: At common law the use had to date back to time immemorial which was taken to be 1189. The rules were later relaxed - if a user could show use as of right for 20 years, he could claim an easement.

Lost modern grant: assumes that, provided that a user can show 20 years enjoyment as of right, and that the grantor of the "lost" grant was competent, the right can become an easement. It does not matter that there was never a grant in existence.

The Prescription Act 1832: provides that an easement enjoyed as of right cannot be defeated by evidence that use began after 1189 provided that it has been enjoyed for 20 years. After 40 years the right becomes indefeasible unless the original use was as a result of consent or agreement.

Re Ellenborough Park

Lays down the essential characteristics of an easement. The characteristics are

there must be a dominant and a servient tenement
the easement must accommodate the dominant tenement
the dominant and servient tenements must be owned (or at least occupied) by different persons
the easement must be capable of forming-the subject matter of a grant

Wheeldon v Burrows: Quasi-easements may become true easements under the rule in Wheeldon v. Burrows. The rule is applied when a landowner sells part of his land and he used to exercise a quasi-easement (usually either a right of way or a right of light) over the land retained in favour of the land sold. Provided that there was unity of seisin immediately prior to the grant, the user was "continuous and apparent, the quasi-easement was in use "at the time of the grant and was one of "reasonable necessity ",the land retained becomes the servient tenement and the land sold becomes the dominant tenement.

Chapter 10

Covenant: legally enforceable promise in a deed to carry out some specified task (positive covenant) or refrain from some specified action (restrictive covenant)

Negative covenant: A promise to refrain from a specified action. It does not matter how the covenant is worded. The test is whether the covenant involves the covenantor in expenditure; if it involves expenditure, the covenant is positive. For example not to allow a road to fall into disrepair is expressed in negative terms but it is a positive covenant because it will involve the covenantor in expenditure when he repairs the road. Conversely, a covenant to maintain a field free from buildings is expressed in positive terms but it is a restrictive covenant because all that is required is that the covenantor does not build upon the land - in other words it merely restricts his use of the land.

Positive Covenant: The test is whether the covenant involves the covenantor in expenditure; if it involves expenditure, the covenant is positive. The burden of a positive covenant cannot run with the servient land

Touch and Concern: This is one of the requirements for running a covenant at law. In Swift Investments Ltd v. Combined English Stores Group Ltd [1989], Lord Oliver formulated rules which provide a working test for determining whether a covenant touches and concerns the land (a) the covenant benefits only the reversioner for time being, and if separated from the reversion ceases to be of benefit to the covenantee; (b) the covenant affects the nature, quality, mode of user, or value of the land of the reversioner; (c) the covenant is not expressed to be personal; (d) the fact that a covenant is to pay a sum of money will not prevent it from touching and concerning the land so long as the three conditions (above) are satisfied and the covenant is connected with something to be done on , or in relation to the land

Tulk v Moxhay

Since the decision in Tulk v. Moxhay (1848) equity has been prepared to run the burden of covenants in certain situations when the common law would not. The ratio of Tulk v. Moxhay was that a covenant could be enforced against the assignee of the covenantor if the assignee had notice of the covenant. Subsequent case law has restricted the scope of the rule in Tulk v. Moxhay by requiring the following four conditions to be satisfied before that burden will run

the covenant must be restrictive or negative
the covenantee must at the time of the creation of the covenant and afterwards own the land for the protection of which the covenant is made (see London County Council v. Allen [1914])
the covenant must touch and concern the dominant land See Rogers v Hosegood
it must be the common intention of the parties that the burden of the covenant shall run with the land of the covenantor This will usually be presumed under the LPA 1925 s79 unless a contrary intention is shown.

Halsall v Brizell: The rule in Halsall v. Brizell [1967] states that he who takes the benefit of a deed must also shoulder the burden. However, Lord Templeman limited the use of the doctrine in Rhone v. Stephens [1994], he made it clear that the benefit and the burden must be connected, they cannot be independent obligations.