The legal issue in this scenario is an unregistered title which is subject to the Land

Charge Act (LCA) 1972. It stated that rights which affect unregistered title should be

registered as land charges at the Land Charges Registry. This, therefore, represent

actual notice to the whole world, thus protecting such interest even when the land is

sold as stated in Land Property Act (LPA) 1925 s198 and s271. This register is

names based system as against land-based as stated in LCA 19722 and in Oak Co-

operative v Blackburn3.

Letitia is not the legal owner of the cottage but sequel to her £25,000 direct

contribution towards the purchase; she acquired an equitable interest in the cottage

arising from a resulting trust as outlined in LPA 19254. However, as noted in Curley v

Parkes5, if the contribution was not made at the date of the purchase, Letitia cannot

acquire a beneficial interest in the property under a resulting trust. Likewise, if the

contribution was made towards household maintenance as stated in Burns v Burns6

and Lloyds Bank plc v Rosset7, it would not equate to equitable interest under a

resulting trust. By her action, it can be presumed that Letitia intends to retain a

beneficial interest in that contribution, which implies that Terry as a trustee holds

£25,000 of the value of the cottage in resulting trust for Letitia as held in Dyer v

Dyer8 and affirmed in Bull v Bull9. Despite this position, Letitia interest can be

overreached if Terry appoints a second trustee for the cottage and payment is

subsequently made to the two trustees as highlighted in Kingsnorth Finance v

1
Law of Properties Act 1925 s27 and s198
2
Land Charges Act 1972 s3
3
Oak Co-operative Building Society v Blackburn [1968]
4
Law of Property Act 1925, s1(3)
5
Curley v Parkes [2004] EWCA Civ 1515
6
Burns v Burns [1984] Ch 317
7
Lloyds Bank plc v Rosset [1991] 1 AC 107
8
Dyer v Dyer [1788] 2 Cox 92, 93
9
Bull v Bull [1955] 1 QB 234
Tizard10 and HSBC Bank v Dyche11, thus Letitia’s interest will be detached from the

cottage and attached to the value paid to the two trustees as stated in LRA 192512,

TOLATA 199613 and affirmed in City of London Building Society v Flegg14. Letitia

would then have only personal claims against the trustees because equitable right as

a right in personam15 has limited capacity to bind a third party, unlike a legal trust

which is a right in rem that binds the entire world. To protect Letitia equitable interest

which is not registrable as a land change under the LCA 1972, it must first be

established that Terry remains the only trustee and her interest in the cottage have

not been hitherto overreached as held in City of London Building Society v Flegg16.

Letitia can then be advised to reasonably argue that her interest is overriding as

explained in LPA 192517 and re-stated in LRA 200218 because she was in actual

occupation19, although in Caunce v Caunce20, the wife’s occupation in the

matrimonial home was not considered to be a sufficient notice to the purchaser but

this was rebutted in Williams & Glyn’s Bank v Boland21 and Kingsnorth Finance v

Tizard22 where a wife’s beneficial interest under a trust land could be protected if she

is in actual occupation so far the interest is disclosed on reasonable enquiry or her

occupation is noticeable upon a reasonable inspection. In 2013 Letitia was

temporarily absent from the cottage for eighteen months, unlike in Thompson v

10
Kingsnorth Finance Co v Tizard [1986] 1 WLR 783
11
HSBC Bank v Dyche [2009] EWHC 2954
12
Land Registration Act 1925 s2(1)
13
TOLATA 1996
14
City of London Building Society v Flegg [1988] AC 54
15
Smith RJ, Property law: Cases and Materials (6thedn, Pearson, United Kingdom) 18
16
City of London Building Society v Flegg [1988] 1 AC 54
17
LPA 1925 S70 (1) (g)
18
LRA 2002 schedule 3 para 2
19
Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 211, 222
20
Caunce v Caunce [1969] 1 ALL ER 722
21
Williams & Glyn’s Bank v Boland [1981] AC 487 HL
22
Kingsnorth Finance Co v Tizard [1986] 1 WLR 783
Foy23; where the claimant had no intention of returning, Letitia in this scenario had no

such intention. Although as held in Hodgson v Marks24, actual occupation includes

physical presence of the claimant in the property, however, according to LPA 192525

and in line with the position held in Chhokar v Chhokar26 and affirmed in Link

Lending Ltd v Bustard27, the claimants were considered to be in actual occupation

despite being temporarily absent from the property, based on this, Letitia is deemed

to be in actual occupation. Secondly, Letitia could be advised to argue that she

equally have an equitable interest in the cottage under a constructive trust which is

wider in application than a resulting trust. Lord Bridge in Lloyds Bank v Rosset28

gave three requirements of a constructive trust as common intention (express and

implied agreement), reliance and detriment. Although there was no express

agreement between the Terry and Letitia as seen in Eves v Eves29 but by their

conducts, by financially contributing directly towards the purchase of the cottage, it

can be implied that they both have the common intention30 to hold beneficial

interests in the cottage as held in Gissing v Gissing31 and affirmed by the House of

Lords in Stack v Dowden32 and the Supreme Court in Jones v Kernott33. Moreover,

mortgaging the cottage will be detrimental to Letitia’s interest. Additionally, Letitia

can protect her interest under Class F of LCA 197234 which is a home right as stated

23
Thompson v Foy [2009] EWHC 1076 (Ch)
24
Hodgson v Marks [1981] AC 487
25
Land Property Act 1925 s70(1)(g)
26
Chhokar v Chhokar [1984] FLR 313
27
Link Lending Ltd v Bustard [2010] EWCA Civ 424
28
Lloyds Bank v Rosset [1991] 1 AC 107
29
Eves v Eves [1975] 1 WLR 1338
30
J Stevens and R Pearce, Land Law (5th edn, Sweet & Maxwell, London) 323
31
Gissing v Gissing [1970] 2 ALL ER 780
32
Stack v Dowden [2005] EWCA Civ 857
33
Jones v Kernott 2011 UKSC 53
34
Land Charges Act 1972
under the FLA 199635 that was later amended by the CPA 200436 and as seen in

Wroth v Tyler37. This is a right given to spouse or the civil partner to occupy the

matrimonial home even though that partner is not a co-owner of the property, this

could be done without Terry’s consent; however, if used wrongly, the charge can be

cancelled by the court as held in Barnett v Hassett38.

Ron was granted a right of way at the rear of Dell Cottage, which is a positive

easement39. An easement as a right that is attached to a land restricts the owner’s

use of the affected portions. Easement as stated in LPA 192540 is the right to cross

or use another’s land for a specific purpose as held in Harris v Flower41. Rights of

way can be expressly created, implied, acquired by prescription or “verge space” and

“swing space”42. In this scenario, the four fundamental elements of an easement as

stated in Re: Ellenborough Park43 are fulfilled; there is a dominant and servient piece

of land as held in Wall v Collins44, the easement accommodates the dominant

tenement as held in Hill v Tupper45, the dominant and servient owners are different

and fourthly, the easement is capable of being granted a deed, that is sufficiently

certain and recognised by the courts as held in Phipps v Pears46. Since easement is

capable of existing as a legal interest, to protect his interest in the cottage as stated

in LPA 192547 and Law of Property (Miscellaneous Provisions) Act 1989)48, Ron can

35
Family Law Act 1996 class F PART IV s.30
36
Civil Partnership Act 2004
37
Wroth v Tyler [1974] Ch 30
38
Barnett v Hassett [1981] 1 WLR 1385
39
Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 313
40
Law of Properties Act 1925 s1(2)(a)
41
Harris v Flower [1904] 74 LJ Ch 127
42
J Stevens and R Pearce, Land Law (5th edn, Sweet & Maxwell, London) 511-517
43
Re: Ellenborough Park43 [1956] Ch. 131
44
Wall v Collins [2007] All ER (D) 278
45
Hill v Tupper [1863] 159 ER 51
46
Phipps v Pears [1965] 1 QB 76
47
Law of Properties Act 1925 s.1(2) and s.52(1)
be advised to execute a deed to legalise the easement, otherwise, a new purchaser

may take free of such equitable easement49. Furthermore, he can protect his interest

by registering in the charges register under Class D (iii) of the LCA 197250, which

contains charges and any other third-party rights which may adversely affect the new

owner’s rights. Under the LRA 2002 equitable interest is no longer overriding, but

can only take effect under equity if the requirements for a legal easement are not

met.

The covenant between Terry (covenantor) and Martins (covenantee) is a

restrictive/negative covenant because it restricts the erection of further buildings in

the garden of Dell Cottage. In this scenario, an encumbrance is placed on the

cottage which is referred to as covenant appurtenant as agreed the covenant’s

terms. As long as this covenant subsists, subsequent buyers are bound by its terms.

Martins can be advised to protect his interest by registering in the land register under

Class D (ii)51 of the LCA 1972. He can also protect his interest by executing a deed

as highlighted in LPA 192552 and Law of Property (Miscellaneous Provisions) Act

198953. He can also seek a court injunction if Terry reneges on the terms of the

covenant54. These two agreements with Terry are transferable to the successors of

both Martins and Ron even if they are unnamed in the agreement55 as held in Smith

Snipes v River Douglas56 .

48
Law of Property (Miscellaneous Provisions) Act 1989), s1
49
Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 348
50
Land Charged Act 1972, S.2(5)
51
Ibid
52
Law of Properties Act 1925 s.52(1)
53
Law of Property (Miscellaneous Provisions) Act 1989), s1
54
Clarke Sandra and Greer Sarah, Land Law (5tgedn, Oxford, United Kingdom) 359
55
LPA 1925 s56 (1), s.78 (1)
56
Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board [1949]
In this scenario, Grasping bank being the first legal mortgagee is expected to hold

the title deeds of the cottage which would have been a reasonable protection of their

equitable interest thereby giving them priority over any intended new

mortgagee/purchaser57, unfortunately, this was omitted. According to LCA 197258,

any mortgagee of unregistered land will be bound by all interests that they have

constructive, imputed or actual notice unless those matters are void against them for

lack of registration. To take ownership of the cottage free from any other equitable

interest, they must show that they are the genuine purchaser of a legal estate for

value without any notice as held in Lloyd v Banks59 and must be seen to have

entered the transaction in good faith. Failure to inspect the property equally means

that constructive notice will apply as seen in Lloyds Bank v Carrick60 and stated in the

LPA 192561. To protect their interest, Grasping Bank could be advised to register its

interest under the land charge under Class C (i) of the LCA 197262, (although this is

more common for a second mortgage) otherwise it will only take effect as an

equitable mortgage and it will lose it priority which is normally decided by date order

as held in Dearle v Hall63 and highlighted in LPA 192564. Under LRA 200265, if a

transaction is the first legal mortgage on the unregistered cottage, it will trigger for

registration.

57
Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 432-433
58
Land Charges Act 1972, s4 (5)

59
Lloyd v Banks [1868]
60
Lloyds Bank v Carrick [1996] 4 All ER 630 Court of Appeal

61
Law of Property Act61 1925 (LPA 1925), s 1999(1)(ii)
62
Land Charged Act 1972, s.2
63
Dearle v Hall [1828] 38 ER 475
64
LPA 1925 s137
65
Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 405
Since this scenario was after 1 January 1926, LCA 1972 becomes operatives

otherwise the doctrine of notice would have been adequate to protect the

aforementioned interests. Accordingly, the onus is on the equitable owner to ensure

that their interests are protected by registration as demonstrated in Midland Bank

Trust Co Ltd v Green66 that if an estate contract which was registrable under LCA

197267 but remained unregistered, such cannot be enforced against the purchaser

irrespective of knowledge of any charge on the land.

66
Midland Bank Trust Co Ltd v Green [1980] UKHL 4
67
LCA 197267, s.2(4)(iv)
Bibliography

Acts

Civil Partnership Act 2004

Family Law Act 1996 class F PART IV s.30

Land Charged Act 1972, s.2

Land Charged Act 1972, S.2 (5)

Land Charges Act 1972

Land Charges Act 1972 s.4

Land Charges Act 1972 s3

Land Charges Act 1972, s4 (5)

Land Property Act 1925 s70 (1) (g)

Land Registration Act 1925 s2 (1)

Law of Properties Act 1925 s.52 (1)

Law of Properties Act 1925 s.52 (1)

Law of Properties Act 1925 s1 (2)(a)

Law of Properties Act 1925 s198

Law of Properties Act 1925 s27

Law of Property (Miscellaneous Provisions) Act 1989), s1

Law of Property (Miscellaneous Provisions) Act 1989), s1

Law of Property Act 1925 (LPA 1925), s 1999(1)(ii)

Law of Property Act 1925, s1(3)

LCA 1972, s.2 (4)(iv)

LPA 1925 s.1 (2)

LRA 2002 schedule 3 Para 2

LRA 2002 Schedule 3 Para 2

TOLATA 1996 S.

Books

Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 211,

222

Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 313

Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 348

Clarke Sandra and Greer Sarah, Land Law (5tgedn, Oxford, United Kingdom) 359

Clarke Sandra and Greer Sarah, Land Law (5thedn, Oxford, United Kingdom) 432-

433

J Stevens and R Pearce, Land Law (5th edn, Sweet & Maxwell, London) 323

J Stevens and R Pearce, Land Law (5th edn, Sweet & Maxwell, London) 511-517

Smith RJ, Property law: Cases and Materials (6thedn, Pearson, United Kingdom) 18

Cases

Barnett v Hassett [1981] 1 WLR 1385

Bull v Bull [1955] 1 QB 234

Burns v Burns [1984] Ch 317

Caunce v Caunce [1969] 1 ALL ER 722

Chhokar v Chhokar [1984] FLR 313

City of London Building Society v Flegg [1988] 1 AC 54

City of London Building Society v Flegg [1988] AC 54

Curley v Parkes [2004] EWCA Civ 1515

Dyer v Dyer [1788] 2 Cox 92, 93

Eves v Eves [1975] 1 WLR 1338

Gissing v Gissing [1970] 2 ALL ER 780

Harris v Flower [1904] 74 LJ Ch 127

Hill v Tupper [1863] 159 ER 51

Hodgson v Marks [1981] AC 487

HSBC Bank v Dyche [2009] EWHC 2954

Jones v Kernott 2011 UKSC 53

Kingsnorth Finance Co v Tizard [1986] 1 WLR 783

Link Lending Ltd v Bustard [2010] EWCA Civ 424

Lloyd v Banks [1868]

Lloyds Bank plc v Rosset [1991] 1 AC 107

Lloyds Bank v Carrick [1996] 4 All ER 630 Court of Appeal

Midland Bank Trust Co Ltd v Green [1980] UKHL 4

Oak Co-operative Building Society v Blackburn [1968]

Phipps v Pears [1965] 1 QB 76

Re: Ellenborough Park [1956] Ch. 131

Smith and Snipes Hall Farm Ltd v River Douglas Catchment Board [1949]

Stack v Dowden [2005] EWCA Civ 857

Thompson v Foy [2009] EWHC 1076 (Ch)

Williams & Glyn’s Bank v Boland [1981] AC 487 HL

Wroth v Tyler [1974] Ch 30