Examiners’ report 2014

Examiners’ report 2014

LA3003 Land law – Zone B

Specific comments on questions

Question 1
‘It is never easy for the law to strike the correct balance between simple, clear
formality requirements and the desire to give effect to the intentions of the
parties despite the absence of formalities. This much is evident in respect of
the way proprietary estoppel may operate to create beneficial interests when
no valid conveyance or land contract exists.’
Discuss.
General remarks
There are a variety of legitimate ways of responding to the terms of this testing
quotation. Essentially it is looking for a discussion of land law’s difficulty in
balancing formality requirements with the aspiration of allowing the creation and
operation of rights informally.
Law cases, reports and other references the Examiners would expect you to
use
Cobbe v Yeomans, Thorner v Major, Kinane v Alimamy Mackie-Conteh, s.9 WA
1837, s.52, 53 LPA 1925, s.2 LP(MP)A 1989, s.116 LRA 2002.
Common errors
Candidates frequently failed to restrict the answer to the specific issues raised in
the quotation. Such questions are not an invitation to write all you know about the
general area of proprietary estoppel. A sizeable minority of candidates appeared to
offer rote-learnt answers of dubious relevance that inevitably received a low mark
as, being prepared in advance, they could not expect to address the specific issues
raised in the question.
A good answer to this question would…
The question was not asking for a wide-ranging or abstract discussion and a good
answer consequently tended to target the two specific issues mentioned in the
second part of the quotation: proprietary estoppel’s role in creating beneficial
interests; and also the formality requirements about land contracts and transfers of
title. There is scope for answers to capitalise on a diverse range of judicial and
academic views and a good candidate would offer a focused but wide-ranging
discussion that captured this debate.
Poor answers to this question…
Unfortunately a sizeable number of candidates were indiscriminate in their selection
of material and/or partially or wholly ignored the precise wording and ideas
contained in the quotation.

1
LA3003 Land law

Question 2
Rigsby owned a large house which was sub-divided into three separate flats:
Flat 1, Flat 2, and Flat 3.
Rigsby allowed his cousin, Alan, to move into Flat 1 after Alan’s marriage
broke down and he had nowhere else to live. Alan signed a standard form
‘lease agreement’ that Rigsby found online. Rigsby deleted all the references
in the document to ‘lease’ and replaced them with the word ‘licence’. He also
added the following term: ‘Alan may occupy Flat 1 until he re-marries’.
Two local students, Philip and Brenda, responded to Rigsby’s advertisement
about occupying Flat 2. Rigsby required them to sign identical agreements
allowing them to live in the flat for three years. The agreement included the
following clauses: (a) Philip and Brenda must each pay £100 per week as an
‘occupation fee’, (b) Rigsby can decide to let a third person share the flat with
Philip and Brenda, and (c) Rigsby is to retain a key. Rigsby assures Philip and
Brenda that he will only need to use it if there is a water leak.
In January 2014 Rigsby agrees to grant Jones a lease of Flat 3 for two years
at an annual rent of £10,000, the rent to be paid in weekly instalments. Rigsby
never grants the lease but Jones moves in and pays the rent once a month.
Advise Rigsby as to the legal status of Alan, Philip, Brenda, and Jones.
General remarks
Essentially, Rigsby needs advice on whether his arrangement with the occupiers of
each flat takes the form of a lease or licence.
Law cases, reports and other references the Examiners would expect you to
use
Street v Mountford, AG Securities v Vaughan, Antoniades v Villiers, Mikeover v
Brady, Prudential v LRB, Berrisford v Mexfield, ss.52, 54, 149(6) LPA 1925, s.2
LP(MP)A 1989.
Common errors
A failure to address the specific issues under each of the leases via an essay that
either did not consider each lease separately in turn, or did so repetitively, failing to
appreciate the different facts under each of the scenarios.
A good answer to this question would…
be divided into three sections and address the following issues.
Flat 1: Using Street v Mountford and related case law a key point of advice will be
the effect of Rigsby altering the pro forma agreement in the determination of
whether Alan does or does not enjoy exclusive possession. Even if Alan does enjoy
exclusive possession, there is scope to argue that he occupies under a licence
rather than a lease because Rigsby is his cousin and Rigsby agreed to Alan’s use
of Flat 1 because of marital difficulties. The maximum duration of the stated term is
clearly uncertain. But presumably it could be cured, under Berrisford v Mexfield, by
an application of s.149(6) LPA 1925, making it a determinable 90 year lease;
although the facts are silent as to whether Alan is paying rent, which would appear
to be a requirement under s.149(6).
Flat 2: The three year term is certain and the payment of an occupation fee could
constitute rent. As Philip and Brenda are shared occupiers the advice to Rigsby will
need to include a consideration of whether they have exclusive possession as joint
tenants. It will consequently be useful to draw on case law that bears upon the
provision of separate, yet arguably interdependent agreements, and the

2
 Examiners’ report 2014

interpretation of the term about whether the rent obligation is compatible with unity
of interest.
The advice about exclusive possession might be expected to draw on precedent
and illustrative case law and incorporate consideration of: the effect of Rigsby’s
retention of the key to repair leaks; Rigsby’s labelling of the payment as an
‘occupation fee’; and the claim to be able to introduce a third person into the flat.
This latter clause may be used as a hook to consider the applicability of the ideas of
sham/pretence, and raise questions about the absence of factual details, such as
the size/layout of the flat.
Flat 3: Here consideration should be given to the possibility of a Walsh v Lonsdale
equitable lease (assuming the agreement with Jones is written), a monthly periodic
tenancy or a legal fixed term tenancy under s.54(2) LPA 1925.
Poor answers to this question…
would fail to appreciate that the Examiners wrote the problem in order to bring up a
number of separate issues in this area and do not expect candidates to repeat the
same advice in respect of each lease or to treat the three leases as if they were one
composite lease.
Question 3
Adam was the registered owner of a large estate. There was a disused cottage
on the estate that had been empty for some time. In 1990, Tim decided to
renovate the cottage and make it his home. In 1993 he began refurbishing the
property and occasionally stayed overnight when working late on the
refurbishment. In 1995 he and Lisa, a keen gardener, moved in and began
landscaping the gardens and mended the fences to keep their pet chickens
from wandering off. Adam, who was attempting to secure finance to demolish
the old cottage and build a sports complex, was aware that Tim and Lisa had
moved in but raised no objection. Tim continued to live in the cottage until his
death in 2000, leaving all his ‘worldly goods’ to Lisa. Last year, after failing to
secure finance, Adam sold the registered title to Saul, who bought the
property after noticing its magnificent gardens. Last week, on legal advice,
Saul wrote to Lisa stating that he was content for her to remain at the
property for the ‘time being’.
(a) Advise Lisa.
(b) How, if at all, would your advice differ in EACH of the following
ALTERNATIVE circumstances:
(i) Adam had expressly told Lisa that he did not mind her and her
boyfriend using the cottage while he was seeking finance;
(ii) Lisa threw Tim out last year after he refused to stop picking
her prize flowers from the garden?
General remarks
In this problem question we have, in addition to the usual categories of comment,
also included specific notes on some of the more pertinent facts to give you an
appreciation of how you might dissect a problem question during the 10/15 mins
you are strongly recommended to spend planning your answer.
 Given that the cottage is disused what amount of physical activity will
amount to factual possession? Is factual possession the same as exclusive
possession? There are various cases to suggest it is (e.g. Powell v
MacFarlane; Bucks CC v Moran, Marsden v Miller) but how then did the

3
LA3003 Land law

overstaying licensee succeed in the leading House of Lords case Pye v

Graham when, by definition, Saul did not have exclusive possession?
 Clearly, events begin prior to 13 October 1991, but when does adverse
possession begin? Presumably, intention existed from 1990, but when did
factual possession arise?
 It seems physical work does not begin for another two years after 1993
and, even then, there is doubt whether this amounts to factual possession
given the infrequency of Tim’s overnight stays. Thus, it seems most unlikely
that adverse possession began prior to 13 October 1991 and the applicable
law is consequently to be found in Schedule 6, LRA 2002 rather than s.75
LRA 1925.
 Does factual possession begin in 1995? Is the fencing significant or does
the fact that it was to keep the chickens in rather than the world out make it
less so? (Inglewood v Baker) Is there any sense in such a dichotomy or do
fences invariably have a dual purpose? On balance it seems likely that
adverse possession began at this point.
 Was the possession adverse? A failure to object seems unlikely to destroy
the adverse nature of the possession particularly since the passing of the
Limitation Act 1980 Schedule 1 para.8(4).
 If (as seems likely) Lisa has been adversely possessing in her own right
jointly with Tim since 1995 her rights continue under the doctrine of
survivorship irrespective of the terms of Tim’s will. However, could you
argue that on the facts only Tim showed the necessary intent to possess
and thus Lisa was only in factual possession (as Tim’s partner) in which
case the testamentary assignment would be relevant as it would enable her
to take the benefit of his prior adverse possession?
 If (as seems likely) Lisa has been adversely possessing in her own right
jointly with Tim since 1995 her rights continue under the doctrine of
survivorship irrespective of the terms of Tim’s will. However, could you
argue that on the facts only Tim showed the necessary intent to possess
and thus Lisa was only in factual possession (as Tim’s partner) in which
case the testamentary assignment would be relevant as it would enable her
to take the benefit of his prior adverse possession?
Common errors
After various references to the issue in the newsletters it was hoped that candidates
would show some appreciation of the fact that the onset of adverse possession is
often not an easy point to identify and that both factual possession and an intent to
possess are required before the clock begins ticking. Unfortunately, far too many
candidates simply assumed adverse possession began in 1990, for no apparent
reason other than the fact that it is the first date mentioned. For the reasons
detailed in the notes above, it was highly unlikely that adverse possession
commenced before 13 October 1991. However, a candidate who took that line and
applied the old law under LRA 1925 was not overly penalised, although those that
failed to include coverage of the new regime under the LRA 2002 (either exclusively
or in the alternative) were unlikely to be awarded higher than a 2.2 at best.
A good answer to this question would…
address many of the subtleties detailed above and offer critical comment on the law
the candidate is applying; whether or not the candidate took a positive, negative or
ambivalent attitude to the changes introduced under LRA 2002.

4
 Examiners’ report 2014

Poor answers to this question…

showed little or no appreciation of the issues raised by the various facts, failed to
note the significance of 13 October 1991, showed little real understanding of how
Schedule 6 LRA 2002 works and were often far too keen to apply proprietary
estoppel in a situation where it was simply not applicable.
Student extract
The question needs an examination on title by adverse possession whether
Tim or Lisa will be able to claim it.
To claim title by adverse possession four requirements must be satisfied:
there must be factual possession; the possession must be open, adverse
and exclusive, the squatter must have intended to possess the land and
lastly it must have been possessed for 12 years prior to the LRA 2002 and
afterwards fulfilled the requirements of LRA 2002.
In the leading case of Bucks CC v Moran it was held that possession is to
be assessed contextually and will vary from terrain to terrain depending
upon the type of land possessed.
There are some cases which illustrate factual possession. Prudentail
Assurance v Waterloo where the refurbishing of a house constituted factual
possession. In Seddon v Smith the mending of fences likewise amounted to
factual possession. It has recently been accepted, in Purbrick v Hackney
LBC that even quite trivial acts can amount to factual possession … [the
essay continues by listing a number of cases where quite trivial acts
amounted to factual possession].
The next requirement is that the possession must be open, adverse and
exclusive as the squatter must be seen to have ‘unfurled his flag’ to show to
the world that he has taken possession … [the essay continues by
considering various cases that demonstrate this point]
The third requirement is that there must be an intent to possess the land
and exclude all others including those with a better title … [the essay
continues by considering various cases that demonstrate this point]
Lastly the adverse possessor has to fulfill the necessary requirements
depending upon whether the land is unregistered or registered and, if the
latter, whether the inception of adverse possession began before or after 13
October 1991 … [the essay continues by considering the different rules that
apply in each of those three situations].
The alternative circumstances where Lisa would have been told by Adam
that he did not mind them using the land whilst he sought finance would be
regarded as an acknowledgement of title under s.29 and s.30 of the LA
1980 and where Lisa threw Tim out the adverse possession would lapse.
[The essay continues by briefly considering what might arise under the
initial facts]
So if Saul did not evict the squatter by 2005 an unimpeachable right will
have been acquired.
Comment on extract
This is a clear fail. In problem questions candidates are assessed on how well they
apply the law to the facts and candidates should avoid the temptation to write
extensively on the generic law without applying it, from the outset, to the facts
before them. This candidate leaves it far too late to start applying the law and
adopts an illogical structure (by considering the alternative facts before the initial

5
LA3003 Land law

ones). The belated attempts to apply the law are also wrong and the essay finishes
with a nonsensical statement suggesting that the new owner (Saul) should have
evicted the squatter almost a decade before he had bought the registered title.
Question 4
Adele owned Greengates, title to which is registered. Greengates comprised
a furniture shop and an adjoining house. In 2011, when Adele retired from
running her business, she leased the furniture shop to Jessie, but retained
ownership of the house. Earlier this year, when the lease came to an end,
Jessie purchased the registered title of the furniture shop from Adele. Jessie
now needs your advice about each of the following matters:
(a) Is Adele entitled to replace the underground drains in the garden of
her house? Jessie is concerned that Adele’s proposed new drainage
system will no longer serve Jessie’s shop.
(b) Can Adele insist upon replacing the broken TV satellite dish that is
hanging on the side wall of Jessie’s furniture shop? Adele insists that
the shop wall is the only location from where it is possible to receive a
reliable TV signal for her house. Jessie, however, wants Adele’s
unsightly satellite dish permanently removed without being replaced.
(c) Can Jessie continue to park her delivery van in the garage belonging
to Adele’s house? Jessie began parking there several weeks after she
leased the shop from Adele in 2011. Adele had suggested the idea
because Jessie’s van had been stolen from the road. Adele is now
claiming that she needs the garage to park her new car.
How, if at all, would your advice to Jessie on (a) and (b) be different if Adele
had sold the registered title to the shop to Jessie in 2011 (rather than leased it
to her)?
General remarks
This is a fairly standard problem designed to test application of aspects of the
doctrinal nature of easements and the available methods by which they may (or
may not) have been (impliedly) created between Adele and Jessie.
Law cases, reports and other references the Examiners would expect you to
use
Re Ellenborough, Copeland v Greenhalt, London & Blenheim v Ladbroke Estates,
Batchelor v Marlowe, Moncrieff v Jameson, Wheeldon v Burrows, Wong v
Beaumont, Sweet v Sommer, Peckham v Ellison, Sovmots v SS for Environment,
Platt v Crouch.
Common errors
Wasting time laboriously going through the requirements of Re Ellenborough when
considering potential easements where there is no issue concerning whether or not
they can exist as an easement and where the candidate should consequently only
be concerned with whether or not they haven been created.
An unwillingness to distinguish between implied grants and reservations when
dealing with (a) and (b).
A failure to appreciate that the rule in Wheeldon v Burrows and s.62 LPA have no
application to implied reservations and only rarely (on the fulfillment of stricter
requirements) can a reservation arise under common intention.
A good answer to this question would…
divide the response into sections and address the following issues.

6
 Examiners’ report 2014

(a) The right to use an underground drain does not warrant a detailed
exploration/application of the ideas in Re Ellenborough as there is no doubt this
is capable of being an easement; the only issue is whether or not it was created
in this instance. There is consequently a need to explore all the available
methods of implied grant to determine if Jessie has a property right enabling her
to object to Adele replacing the existing drains.
(b) Again there is little that appears to be contentious in Adele’s claim that the
right to hang a satellite dish can exist as an easement (although here the advice
might touch upon how it can be argued the right benefits the use of the
dominant land). As there is no suggestion that A has expressly reserved the
right, the advice needs to determine how it may arise via implied reservation.
(c) Advice should first identify the uncertainty in the case law about if and when
a right to park is capable of being an easement (this allows for skilful integration
of academic commentary in the advice.) As Jessie and Adele seem to have
created a licence shortly after the 2011 lease, one issue is whether this has
been transposed into an easement by s.62 when Jessie subsequently acquired
the shop.
The final rubric does not need lengthy attention. For one thing it gives a context for
considering how far the traditional view of a need for prior diversity of occupation,
which makes the operation of s.62 and Wheeldon mutually exclusive, has been
subject to recent judicial challenge.
Poor answers to this question…
fail to subdivide the answer and show no real appreciation of the fact that there are
two basic aspects to an easement question. Namely: (1) is the right capable of
being an easement; and (if so) (2) has it been created as such in this particular
scenario. There is no point in considering (1) where the right in question clearly can
exist as an easement and candidates who laboriously (and in detail) repeat the Re
Ellenborough requirements for each potential easement are simply wasting time
that should be spend on the substantive issues in the problem. You only need to
consider Re Ellenborough in detail where the right in question might not come
within the established categories of easement and thus there was no need to
consider it under (a); while under (b) it was (to the limited extent already noted)
acceptable, but by no means critical, that you did so.
Question 5
Tom was the owner of a large estate with extensive grounds and a manor
house called Mallet. Part of that estate, called Velvet Pastures, was used by
Boystoy Ltd as a croquet ground and museum. In 2004, Tom gave Velvet
Pastures to Boystoy to continue using it as a croquet ground and museum.
The conveyance to Boystoy contained the following covenants by which
Boystoy agreed:
(i) not to allow any structure on Velvet Pastures to fall into disrepair;
(ii) to use Velvet Pastures only for croquet matches to be played between
the hours of noon and 3 pm;
(iii) to allow the current owner of Mallet to preside at any awards
ceremony organised by Boystoy and their successors in title.
In 2005 Tom died and left Mallet to his son Harold, who was also a keen
croquet player like his father. Last year Boystoy went into liquidation and
Velvet Pastures was bought by Girlsthing Ltd, which has begun staging
ladies football matches between the hours of 3 pm and 10 pm on Velvet

7
LA3003 Land law

Pastures. These matches regularly attract a large and often raucous crowd,
quite unlike the sedate audience that previously attended the croquet
tournaments.
At their last board meeting, Girlsthing decided not to repair the museum,
which had been damaged in a recent storm, and announced that the
forthcoming awards ceremony would be a ‘ladies only’ event.
Advise Harold.
General remarks
In this problem question we have, in addition to the usual categories of comment,
also included specific notes on some of the more pertinent facts to give you an
appreciation of how you might dissect a problem question during the 10/15 mins
you are strongly recommended to spend planning your answer.
 Covenant (i): although it takes a negative form this covenant is in substance
positive.
 Covenant (ii): this looks to be negative in substance if interpreted as a
covenant not to build akin to the ornamental gardens clause in Tulk.
Consider whether it might additionally be interpreted as a clause preventing
activity likely to disturb one’s neighbours.
 Covenant (iii): although clearly not personal this does not appear to touch
and concern the land.
 Did the benefits pass to Harold when Tom died?
 Did the burdens pass to Girlsthing when they bought Velvet Pastures?
 Are the ladies football matches a breach of covenant (ii)?
 The decision not to repair the museum would appear to be a breach of
covenant (i).
 Is the ‘ladies only’ awards ceremony a planned breach of covenant (iii)?
This is a standard non-leasehold covenants question where candidates must
consider whether the benefit (Tom to Harold) and burden (Boystoy to Girlsthing)
have duly passed in equity and (for the sake of completeness but not absolutely
necessary) at common law.
Common law: Benefit
1. Assignment
There appear to be no express assignments but as none of these benefits are
purely personal all of them could have been passed as choses in action under
s.136 LPA.
2. Annexation
Clearly these are post-1925 covenants and thus s.78 (as interpreted in Federated
Homes) applies. There are thus only two requirements:
1. the covenant must touch and concern Mallet and
2. both Tom and Harold must have a legal estate in Mallet.
The second does not appear to be an issue (although we have not actually been
told that they own legal estates) leaving us only to consider whether each of the
three covenants touch and concern Mallet. The answer seems to be:

8
 Examiners’ report 2014

Covenant (i): yes

Covenant (ii): probably, if interpreted as a covenant not to build and/or to avoid
activities that disturb the neighbours.
Covenant (iii): no.
The burden of course cannot pass at law and thus we now move to whether or not
the benefit and burden passed in equity (perhaps pausing to consider whether, if
the burden passes in equity, it is sufficient for the benefit to have passed at
common law; which usually does not matter (as equity is only rarely more
restrictive) but is also thought insufficient, in which case the benefit must likewise
run in equity – but see Gray, Elements of land law).
Equity: Burden
There are four requirements for the burden to run in Equity:
1. it must be negative
2. it must accommodate the dominant tenement
3. there must be an intention that it should run
4. it needs to be registered.
On that basis the three covenants all seem to fulfil (3) and we have no information
regarding (4). Turning to whether (1) and (2) are fulfilled in respect of each of the
three covenants:
Covenant (i): fails on (1) but not (2).
Covenant (ii): probably succeeds on (2) and definitely (1).
Covenant (iii): definitely fails on (2) and possibly (1).
Thus, the burden in covenant (ii) could well run (provided it was registered) in which
case we need to consider whether the benefit ran in equity (but see discussion
above).
Equity: Benefit
There are two requirements to fulfil for the burden to run in equity: the covenant
must
1. touch and concern Mallet and
2. pass by assignment, annexation or under a scheme of development.
Clearly here the benefit in covenant (ii) will (if interpreted in a way that lets the
burden run) touch and concern the land. There appears to be no possibility of
assignment or a scheme of development but it will pass by means of a statutory
annexation (as considered above at common law), but in equity irrespective of
whether Tom and/or Harold have a legal or an equitable estate in Mallet.
Thus, arguably, the benefit and burden of covenant (ii) have both passed to Harold
and Girlsthing but unlike covenant (i) there is more doubt over whether a breach
has occurred (depending upon how widely covenant (ii) is construed). On covenant
(i) Boystoy would be liable to Harold in damages but as they went into liquidation
that would be of little solace. Finally, no injunctive relief would be available in
respect of covenant (iii) as neither the benefit nor the burden passed to Harold or
Girlsthing.

9
LA3003 Land law

Law cases, reports and other references the Examiners would expect you to
use
Tulk v Moxhay, Federated Homes, ss.78, 79, 136 LPA 1925.
Common errors
Quite inexplicably, a fair number of candidates addressed this problem on the basis
of leasehold covenants and duly failed the question. Other common errors included
an unwillingness to consider the substance (rather than the form) of the covenants
when assessing whether they were positive or negative, a failure to properly
distinguish benefit and burden and little consideration of the touch and concern
requirement or the importance of registration.
A good answer to this question would…
adopt a structured approach making good use of sub-headings and showing a clear
understanding of the technical law. A critique of the law in this area could also be
usefully incorporated; particularly in the final paragraph (which should not be
wasted simply summarising what has already been said).
Poor answers to this question…
showed little understanding of the technical aspects of the law and were confused
and chaotic.
Question 6
Elizabeth was the registered owner of Republican Acre, which she purchased
with Phillip, who contributed 30% of the purchase price. Republican Acre
comprises a house, in which they both live, and an adjoining field. Andrew
has an express easement over Republican Acre, giving him access to the
river from his neighbouring property, but he now no longer uses the
easement since he recently became scared of water. Last year Elizabeth
granted Andrew a ten-year option to purchase Republican Acre for
£5,000,000. In January Elizabeth sold Republican Acre to Charles for
£10,000,000 while Phillip was on a 3-month ‘round the world’ cruise and
Andrew was staying in their guest room because all the bathrooms were
being renovated in his house. Charles is now the registered owner of
Republican Acre.
(a) Advise Charles.
(b) How, if at all, would your advice differ in EACH of the following
ALTERNATIVE circumstances:
(i) No purchase monies arose on the disposition to Charles as
the house was a gift from Elizabeth;
(ii) Charles only paid £1 for Republican Acre?
(c) Describe, briefly, how, if at all, your advice in (a) and (b) would differ if
title to the land was unregistered and each transaction was carried out
solely subject to the rules of unregistered title.
General remarks
In this problem question we have, in addition to the usual categories of comment,
also included specific notes on some of the more pertinent facts to give you an
appreciation of how you might dissect a problem question during the 10/15 mins
you are strongly recommended to spend planning your answer.
 We are talking about a registered title from the outset so there is no issue of
first registration to consider.
 Elizabeth holds the legal estate on trust for Elizabeth and Phillip.

10
 Examiners’ report 2014

 Despite the obiter comments in Stack v Dowden and Jones v Kernot

regarding the inapplicability of the resulting trust in the domestic context,
the courts do not (according to the Court of Appeal in Geary v Rankine)
have the ability to impute a common intention in an acquisition case (i.e. a
case where the other party is not on the legal title via a joint tenancy). On
these facts, unless the differential contributions to the purchase price can
be used to infer a common intention to share equally (or in some other non-
resulting proportion), a resulting trust would, in the absence of any evidence
to decide otherwise, appear to be the only solution here.
 We are told that Andrew has an express easement and there is
consequently no point in speculating upon whether the easement is
capable of being express, nor whether it was created expressly, impliedly or
not at all. The only issue to concern us in this question is whether or not it is
legal or equitable, as we have not been given that information.
 Likewise we do not need to dwell overlong on s.2 LP(MP)A 1989 as the
question states that an option to purchase was granted and so it must, by
definition, comply with the formal requirements necessary to be an option.
 Charles is clearly a purchaser for value.
 Was Phillip still in occupation at the time of the sale to Charles under
Boland and if so was that occupation discoverable under LRA 2002
Schedule 3, para.3(2)?
 Likewise, is Andrew in discoverable occupation for the purposes of
para.3(2)?
 So we need to discover whether Charles is bound by Phillip or Andrew’s
interests.
This is a question on the rules of registered and unregistered conveyancing and
candidates do not gain credit if they waste time on the requirements of a valid
option or express easement. As you are told in the subject guide, you should take
such statements as authoritative and thus, if told an option or express easement
has been granted, you should not look behind that fact to query compliance with the
necessary formalities. In contrast, you have not been told whether the express
easement is legal or equitable and thus that is something on which you should
speculate and answer in the alternative.
Law cases, reports and other references the Examiners would expect you to
use
See the cases and statutory provisions listed below.
Common errors
Many candidates continue to confuse the rules of registered and unregistered
conveyancing and, in particular, attempt to apply the Land Charges Act 1972 to
registered title when it is only applicable to unregistered title. You are strongly
recommended to consult the diagrams included in the subject guide.
A good answer to this question would…
Would adopt the structure of the question and cover the following issues:
(a)
Beneficial interest
Phillip should have protected this by means of a restriction requiring that any
conveyance comply with overreaching. This appears not to have happened as
Elizabeth, as sole legal owner, transferred the registered title to Charles for value

11
LA3003 Land law

clearly not in compliance with overreaching. Thus, it depends upon whether Phillip
comes within Schedule 3 para.3(2) which requires candidates to determine whether
he remained in occupation during his three month sojourn (probably) and whether it
was discoverable on a reasonably careful inspection of the land (where you need to
speculate as you have not been given any facts regarding the occupation or
inspection).
Express easement
As an express easement it must be substantively registered to be legal in which
case it will bind C. If not substantively registered the equitable easement could be
protected by means of a notice and would again bind C. If this has not occurred it
cannot come within Schedule 3 para.3 as it not a legal easement although it might
come within para.2 if coupled with discoverable occupation. The Court of Appeal in
Chaudhary v Yavuz refused to find that using a metal staircase constituted ‘actual
occupation’. Admittedly they explicitly chose not to offer any comment as to whether
the exercise of other forms of easement could ever comprise ‘occupation’ but that
would appear to be relevant to easements such as parking and storage and not
applicable to these facts. However under Webb v Pollmount there does not need to
be any causal connection between the right protected and the occupation that
provides the protection. Thus, the equitable easement would be protected if on
these facts Andrew is held to be in discoverable occupation even though that
occupation was not derived from the option but from the act of good
neighbourliness.
Option
This is necessarily an equitable interest which, to bind Charles, should have been
protected by means of a notice. In the absence of so doing Andrew will only be
protected if he is in discoverable occupation as discussed above.
(b)
(i) Under State Bank of India v Sood it is arguable that, where no purchase monies
arise, even a single trustee can enter into an overreaching transaction. Thus,
Phillip’s interest would be overreached even if he were in discoverable occupation.
(ii) Is £1 nominal consideration? According to the House of Lords in Midland Bank v
Green the concept is an absolute and not relative term. This is surely open to
debate (it would after all, unlike a peppercorn or a 1p, fail my ‘not bending down to
pick it up if I saw it on the ground’ test!) If it is nominal then, unlike in unregistered
title, Charles is not a purchaser who takes free of such unprotected interests, as
valuable consideration is defined as excluding nominal consideration under s.133.
(c)
(a) The survival of Phillip’s beneficial interest will be decided under the
equitable doctrine of notice (Kingsnorth v Tizard).
Andrew’s easement if legal will bind the world and if equitable should
have been protected as a class D(iii) land charge and will be void
against Charles if not so registered.
Andrew’s option should have been protected as a class C(iv) land
charge and will be void against Charles if not so registered.
(b) (i) If the above reading of Sood is correct, Phillip will be overreached
even if his interest was binding under the equitable doctrine of notice.
(ii) In contrast to registered title, even if £1 is nominal consideration,
Charles will still be purchaser for money or money’s worth under s.4(6)

12
 Examiners’ report 2014

LCA 1925 as according to Midland Bank v Green ‘money or money’s

worth’ includes nominal consideration.
Poor answers to this question…
waste time considering whether or not an easement or an option has been granted
or spend too long on speculating on what share in the beneficial interest Phillip
might acquire.
Question 7
‘Although the mortgage is a creature of equity, it is time for equity to
relinquish its hold and let statute regulate a device where the residential or
commercial nature of the transaction necessarily requires a wholly different
degree of legal oversight.’
Discuss.
General remarks
This was an essay that provided candidates with a chance to consider the very
different circumstances in which mortgages are granted and the inappropriateness
of the one size fits all approach of equity.
Law cases, reports and other references the Examiners would expect you to
use
Multiservice Bookbinding v Marden, Cityland v Dabrah, Samuel v Jarrah Timber,
Reeve v Lisle, Biggs v Hoddinot, Sanley v Wilde, Kreglinger v New Patagonia, AJA
1970/1973, CCA 2006, FSMA 2000.
Common errors
A failure to go beyond the case law to consider the legislative developments in this
area in recent years.
A good answer to this question would…
explain how legislative advances in recent years have already begun to make
inroads into the homogenic nature of the mortgage (as emphasised by recent
developments regarding the future role of the FCA) and speculated on whether or
not more could and should be done in this area.
Poor answers to this question…
Simply wrote all they knew about the law of mortgages.
Student extract
This essay began with a comparatively brief explanation of how the mortgage is
indeed historically the product of equity’s intervention to address the shortcoming in
the ancient common law mortgage. It then continues by considering relatively
modern cases including Multiservice Bookbinding v Marden, Cityland v Dabrah to
illustrate the very different issues and pressures that exist in commercial and
residential settings before describing the statutory framework that applies to the
latter in the following extract.
However in addition to the historic equitable safeguards, residential
mortgages have become increasingly subject to statutory regimes. Until
recently there were two regulatory schemes but from April 2014 the
Financial Conduct Authority (FCA) became responsible for regulating all
such mortgages. Before then first legal mortgages of residential properties
to be occupied by the borrower were already regulated by the FCA. Whilst
consumer mortgages which previously fell outside of FCA regulation, such
as second mortgages and mortgages for other purposes (ie those on a
‘buy-to-let’ basis), were covered by the consumer credit legislation instead
(the Consumer Credit Act (CCA) 1974, as amended by the Consumer

13
LA3003 Land law

Credit Act 2006). The two regulatory regimes were mutually exclusive, so
that an FCA regulated mortgage fell outside the consumer credit legislation
and vice versa.
The consumer credit legislation was historically aimed at protecting
borrowers with low credit ratings who find it difficult to obtain finance.
However it was often difficult to intervene in such circumstances because
their poor credit rating justified a higher interest rate. In Paragon Finance v
Nash, the court held that a lender’s discretion to vary interest rates was
subject to an implied term not to exercise that discretion for an improper
purpose, arbitrarily or capriciously. However, maintaining interest rates at 2
- 4% above those on the high street was not a breach of this implied term or
‘grossly exorbitant’ under the CCA 1974. Whilst in Davies v Directloan the
lender had not acted improperly by imposing a 21.6% rate of interest (at a
time when market rates were 17%) because he court were justified in taking
into account the poor credit history of the borrower and the subsequent risk
being taken by the lender.
The extortionate credit provisions of the CCA 1974 were replaced by the
concept of an ‘unfair relationship’ under the CCA 2006. This also allows the
court to examine whether the creditor’s behaviour towards the borrower has
in any way been unfair. The legislation, perhaps wrongly from the
perspective of certainty, does not clearly define an ‘unfair relationship’,
preferring instead to leave it to the court to decide how this should be
applied on the particular facts. The CCA 2006 gives the court a wide range
of remedies to deal with an unfair credit relationship, including ordering any
part of the agreement to be set aside, varying any terms, or ordering a
creditor to take or refrain from taking a particular course of action.
The essay then continues by considering another example of the statutory control of
(broadly) residential mortgages in the form of the AJA 1970/73 and the power given
to the court to postpone possession proceedings where the mortgaged property
includes ‘a dwelling house’. The essay then finishes by concluding that the
quotation, although once correct, fails to give enough prominence to recent
statutory interventions that do go some way to recognise the contextual difference
between residential and commercial mortgages.
Comment on extract
This is a clear first with the candidate showing good detailed (but apposite and
succinct) knowledge and a willingness to engage with (and point out weaknesses
in) the quotation.
Question 8
A few years ago Elizabeth, Mary and Sylvia bought a country cottage
together. They were registered as joint tenants and declared in the TR1 form
that they held title in trust for themselves as joint tenants. Elizabeth
contributed 50% of the purchase price, Mary 40%, and Sylvia 10%.
Initially they used the cottage for occasional weekends, but Sylvia soon found
a job nearby and began living in the cottage. Her boyfriend Jim moved in with
her, to help look after their new born baby.
Last year Elizabeth was posted abroad and sold her beneficial interest in the
cottage to Mary.
In January Mary wrote to Sylvia offering to sell her interest in the cottage to
Sylvia. Sylvia replied that she and Jim “would immediately start saving so
that they can take her up on her offer”. In February Mary was made redundant

14
 Examiners’ report 2014

and wrote to Sylvia saying she needed to sell her share now. Sylvia explained
she would definitely be in a position to buy out Mary’s share in a couple of
years but Mary has explained she cannot wait that long and is insisting,
despite Sylvia’s objections, that the cottage be sold immediately.
(a) Advise Sylvia.
(b) If the cottage was sold now, how would the proceeds of sale be
divided?
(c) How, if at all, would your advice in (a) differ in EACH of the following
ALTERNATIVE circumstances:
(i) The property was conveyed into their joint names but no
reference to any trust was made in the conveyance;
(ii) Elizabeth, Mary and Sylvia were business partners and no
reference to any trust was made in the conveyance;
(iii) Mary was adjudged bankrupt;
(iv) Sylvia died yesterday leaving her entire estate to Jim?
General remarks
In this problem question we have, in addition to the usual categories of comment,
also included specific notes on some of the more pertinent facts to give you an
appreciation of how you might dissect a problem question during the 10/15 mins
you are strongly recommended to spend planning your answer.
 The declaration in the TR1 form is conclusive as to the beneficial interest
being held jointly and thus the individual percentage contributions are an
irrelevance.
 Was use ‘for occasional weekends’ the original purpose?
 Did the purpose change from holiday home to family home when Sylvia
began living in the cottage and Jim and their baby moved in?
 Elizabeth has clearly acted upon her share by the irrevocable action of
selling it, and thus severs her interest, which means that Mary is a tenant in
common of one third and that her and Sylvia jointly own two thirds of the
beneficial interest.
 Does Mary’s letter to Sylvia in January count as a written severance under
s.36(2) LPA 1925? Seems unlikely as it does not manifest an immediate
intention to sever.
 Sylvia’s remark about saving up seems to confirm the lack of immediacy
regarding Mary’s plan.
 Does Mary’s letter in February comply with s.36(2) LPA 1925?
(a) Either Sylvia or Mary could apply to court under s.14 TOLATA and under
s.15 the initial purpose [s.15(a)], changed purpose [s.15(b)] and the welfare
of the child [s.15(c)] would all be relevant considerations to which the court
is required to have regard. Whether a postponement of sale would be
ordered is a moot point although Sylvia is in a better position than she
would otherwise be in the absence of a secured creditor petitioning for a
sale.
(b) One third to Sylvia and two thirds to Mary (please see bullet points above
for an explanation as to why).

15
LA3003 Land law

(c) (i) According to Stack v Dowden, in a domestic context, equity follows the
law when the legal title is in joint names (absent requisite evidence to the
contrary) rather than adopting a resulting trust based upon their
proportionate contributions.
(ii) Clearly, in this situation, they would be tenants in common on a
presumed resulting trust in proportion to their contributions.
(iii) Mary’s trustee in bankruptcy would proceed under the more favourable
s.335A IA 1986 and, in the absence of exceptional circumstances, would
prevail after, at most, a 12-month delay.
(iv) Did Mary’s final note sever by written notice? In which case Sylvia was
a tenant in common of one third when she died and could indeed leave that
share to Jim.
Law cases, reports and other references the Examiners would expect you to
use
Williams v Hensman, Re Drapers Conveyance, Burgess v Rawnsley, Nielson Jones
v Fedden, Davis v Smith, Re Palmer, Stack v Dowden, TOLATA 1996, s.36(2) LPA
1925, s.335A IA 1986.
Common errors
A majority of candidates found this a surprisingly difficult question. Errors included:
failing to note the significance of the express declaration concerning the beneficial
interest, not considering either or both the initial and subsequent purpose for which
the house was held; awarding shares after severance by reference to the now
irrelevant percentages the parties contributed to the purchase when any severance
of a joint tenancy will always be on the basis of equal division among the current co-
owners, ignoring the immediacy requirement in s.36(2) LPA, ignoring Stack v
Dowden regarding the presumption applicable to legal joint tenancies of residential
property, failing to apply the contrary presumption relating to business partners;
failing to apply s.335A IA 1986 in the context of bankruptcy; applying the right of
survivorship to a tenant in common.
A good answer to this question would…
adopt the structure given by the question and answer each part in turn, giving
approximately equal treatment to the law of severance and the workings of
TOLATA. Diagrams may be used (although they are by no means essential) but
only if they assist in the explanation and candidates are strongly advised to adopt
the form of diagram used in the subject guide or in Gray’s Elements of land law.
Poor answers to this question…
failed to use the structure dictated by the question and gave composite answers
that (unsuccessfully) sought to answer more than one part simultaneously; sought
to award shares (either from the outset or subsequently) by reference to the initial
contribution to purchase price; provided diagrams of doubtful utility and often
claimed that some (and sometimes all) the alternative facts were of no significance
(it is, by the way, highly likely that the alternative facts will be insignificant in a
problem question).

16