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- Land law is about peoples relationships with and over land ± REGULATION


Gray and Gray Elements of Land Law : µFor serious students of property, the beginning of truth is the recognition that
property is not a thing but a power relationship ± a relationship of social and legal legitimacy existing between a person and
a valued resource (whether tangible or intangible).¶




 

! 

(I) Ñhat interest does each person have in the land? [States/interests]
(II) Ñhat is the relationship between all the persons with an interest in the land?
(III) You must also bear in mind the asset relationship of the land- i.e., what rights are changed or altered when a
piece of land is sold for its value. (This will depend upon the interest or title to land (registered/unregistered).

-
 
 "# 


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- Asset value of the land became secondary under the LRA 1925 to the social and alienable nature of land.
- The system now protects the µuse and occupation¶ value of the land and the asset value.

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- Mr B had signed Mrs B¶s named fraudulently. Mrs B was trying to say that her interest had bound the mortgage
company because her interest has always existed from the time of purchase. She didn¶t enter into the mortgage so
she couldn¶t be bound by the mortgage.
^

- Mrs Boland who did not appear of the legal title was given a beneficial interest in land. The mortgage company
was bound by her interest and if the property was sold, then Mrs B would have to be given some of the mortgage
entitlement and could in effect have a valid reason to stop the sale.
- The Bank in this case were not ultimately aware that a beneficial interest behind a trust was capable of creating an
overriding interest. Hence this is one of the reasons why they didn¶t ask for another legal owner to be placed on the
deeds in order to allow overreaching to take place.( s.2 LPA)


 
    
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In a relationship involving µundue influence¶ the bank is now under specific duties. The case sets out series of guidelines
where a person may be protected by this.Mortgage company has guidelines as to what they must do to avoid this issue.

+
 , -
.//

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.//

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- Land includes all rights, such as easements, held for the benefit of the particular plot of land s. *(23"4




#. .

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- An owner of land no longer has rights to certain valuable minerals under the surface. Unmined gold and silver
belongs to the Crown -  
3c2564

- Items found on the land will belong to the Crown if they are treasure trove ± ./-.

c&&5.

- Nor can a land owner prevent aircraft flying through the airspace above his land ± ,
, 

c&'*

- A land owner cannot abstract water flowing across his land for other than domestic purposes without a licence ±
Ñ.
/ -./

c&&c. All these controls reflect the increasing demands of the population on land use.

7
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˜nytime you have more than one person owning the same interest in land (they are co-owners of the property behind a trust)-
A house bought together

* /

The concept of land ownership is based on the feudal system of land ownership. There is no such thing as absolute
ownership in land, instead there are estates in land. The crown owns everything and gives its subjects pieces which are called
µestates¶. Êhe estate exists independently from the land itself. Êhe land is not important but the µconcept of the estate¶ is. Êhe
estate defines the limits and contents of a person¶s relationship land.

An estate is a concept which has three constituent parts:

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Types of Estate:
34 .:


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8/ -- A lease or tenancy which is granted for a limited period of time. After its time, the
estate ends and it ceases to exist. An estate for life can also exist and this will end when you die.

384 
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8/ -

# //// $
3.  4
This is the largest type of right that you can have. The duration of
this is the closest to perpetual that you can have.

34 
:

.,./ - This is where the freehold owner has leased their property to create a new µestate¶ for a
period of time but still ultimately retains the title of freehold owner once the terms of the lease come to end.


1


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//

S1 (1) Law of Property Act 1925: µThe only estates in land which are capable of being of subsisting or of being conveyed or
created at law are:
(a) An estate in fee simple absolute in possession;
(b) A term of years absolute.

S1 (3) Law of Property Act 1925: µAll other estates, interests, and charges in or over land take effect as equitable interests.

34 
/:
8/ -

 //// 

µIn possession¶ of the estate at that point in time and with it being µAbsolute¶ it is capable of continuing indefinitely: S7 Law
of Property Act 1925

374 .:


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determ nat n   $ 2 $ erat n  laa$    #    $      #
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1) Certa n term25$ #4 +" 4
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(›"$ #4 .

›ae v C andler [1944]: ›"!!  "Ê   " "
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As brn Anstalt v Arnld [1989]:
   
Drdent al Assrane v ›ndn Res dar Bd [1992]%"! Ê "!! 
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(Implied periodic tenancy)
Highlight the problems associated with periodic tenancies. Sometimes if
you tried to create a fixed term tenancy but weren¶t successful you can have an implied periodic tenancy.
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An appeal based on the prudential rule. It isn¶t however about a term of
years as a mutual housing organisation cannot grant a term of years absolute.


2) Rent24a et er r nt at a rent͛ `


 

As brn Anstalt v Arnld [1989]: Ê   #

3) E
ls ve ssess n- µThe right to exclude all others from the land including the lessor¶
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2 It places emphasis not on what the wording say, but the fact to what it created.
2 The court should be alive to strike out sham terms which are only in place to avoid giving tenants exclusive
possession. (note: not every term is sham or pretence)
2 µFork and spade metaphor¶
2 This is an µobjective¶ analysis of the practical components of the terms. (this has ultimately led to problems by not
focusing on the subjective analysis)



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2 A licence agreement was held to be a lease. Focus on the nature of the accommodation. Ie, basement room

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2 Couple singed separate agreement but the reality of the case was that they would not have signed unless they were
going to have the same effect. The contracts were interdependent and had unity of title.

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2 A clause stating that a maximum of three persons could be introduced to share the property with the licensee was
held to be real and reflected the reality of the arrangement. The court was influenced by the fact that each occupant
had signed an agreement, which incorporated a clause that a maximum of three other people could be introduced to
share the house with them. This was a practically acceptable clause in relation to a four bedroom house. The
occupants were stranger who arrives at the property willing, presumably to share with other persons they did not
know, unlike the couple in   /
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In essence, the occupants must in addition to certainty of
term also have a right to possess the whole of the property.
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2 (temporary plan did not matter) Case decided on the fact that the council provided services and have a right to
move people for medical reasons should they become violent whilst staying in one of the temporary
accommodations.

elationship of landlord and tenant with no legal estate

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2 µThe Hol held that it does matter whether or not the landlord has an estate to support a lease binding it on third
parties. On the facts, the landlord had a mere license. This did not stop an agreement (in form of a license) under
which exclusive possession was enjoyed, from creating the relationship of lease or tenancy as between the landlord
and the possessor.
2 µLord Hoffman decided that someone who had a license, could themselves grant an estate in land¶ vs NEMO DAT
A/C: 
Îright, µLeases, Exclusive Possession, ˜nd Estates¶ [2000] 116 LQ
7
2 He created a new form of contractual tenancy and tries to identify what this would look like.
Pawlowski, µOccupational
ights In Leasehold Law: Êime For
ationalisation¶ [2002] Conv. 550
2 Asked whether it was a time to rationalise this area of law and doubts whether Hoffmans views are correct.

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34

 2 µThe 'estate' tenancies held by the appellants were derived from and could not survive the termination of the [head]
lease. The 'non-estate' Bruton tenancies could survive as against the grantor of them [the Housing Trust], but they
were not binding as against [the freeholder]¶ (per Lord Scott)
2 A contractual tenancy gave no additional rights beyond a license.
2 Confirmed in:%   %
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26
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(i) A fixed term lease for 3years or longer must be made by a Deed (this is different from a contract) Ôs 52(1) and 54
Law of Property ˜ct 1925- A lease has to be made by deed to be legal. (A legal term of years absolute)
s. 1 Law of Property (Miscellaneous Provisions) ˜ct 1989 (defined requirements of a deed)

(ii) If less than 3 years, this can be created by parol. (orally) It also has to be for the best rent that can easily be
obtained. s.54 LP˜ 1925

(iii) Equitable lease

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2 If you don¶t have a deed but YOU DO have a binding contract to create a lease; equity will see as done what ought
to be done and (possibly) grant an equitable lease.

s.2 Law of Property (Miscellaneous Provisions) ˜ct 1989(as amended by the
egulatory
eform (Deeds and Documents)
Order 2005 (ÔI 2005/1906) This alters what is necessary for a contract to create an interest in land.

 /
8
  .



Courts are reluctant to imply terms into covenant. Implied covenants: (a lease hold clause or term) A promise that is
contained in a deed.

(i) For quiet enjoyment

Suggesting that the landlord leaves the tenant alone to enjoy their estate in land

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- Effect of a covenant of quiet enjoyment: µcould the landlord be held liable for not properly soundproofing?
- HELD: The noise made by neighbours was not sufficient to cause an actionable nuisance in tort. Covenant of quiet
enjoyment was not relevant and the landlords were not liable for the breach. Tenant took on an estate in the
building and there were no statutory codes requiring a particular density of wall for such tenants.

 
 $ 

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- They tried to argue that the covenant of quiet enjoyment led to a warranty of habitability. (premises of a decent
human living standard)

- There is no general warranty of habitability in English law.

- Facts maintained that the covenant of quiet enjoyment could not be used to imply this warranty of habitability.

(ii) Not to derogate from grant

If you give somebody an estate in land, you cannot take an action based on the premise that you never handed over the lease
to the tenant.

(iii) Repair
There is a difference between something being out of repair and not fit for service.

Ô11 Landlord and Êenant ˜ct 1985: (s.13 & 14 required to be read in unison)
[This is an implied obligation of repair]- The definition of a dwelling house is important.
(1)In a lease to which this section applies (as to which, see sections 13 and 14) there is implied a covenant by the lessor²
(a) To keep in repair the structure and exterior of the dwelling-house (including drains, gutters and external pipes),
(b) To keep in repair and proper working order the installations in the dwelling-house for the supply of water, gas and
electricity and for sanitation (including basins, sinks, baths and sanitary conveniences, but not other fixtures, fittings and
appliances for making use of the supply of water, gas or electricity), and
(c) To keep in repair and proper working order the installations in the dwelling-house for space heating and heating
water.

(iv) Passing of covenants

Covenants that regulate the agreement becoming imprinted on the estate. If you create an estate by contract, any of these
terms will become more than contractual and turn into proprietary rights. (Binding upon 3rd parties)

Privity of estate:
Landlord and tenant for the period of time have privity of estate between each other. Eg, if you move, you can sell on your
lease and in doing so you µassign¶ (give away all of your rights) your rights to that estate. Privity of estate exists between the
new lease holders. The covenants agreed in the originally lease agreement will pass onto the new lease holder and they will
be enforceable by the landlord & equally so the new tenant against each other.
! 

3c2'-4


- µThe passing of the benefit and burden of lease hold covenants passes with privity of estate... to become
enforceable by the tenant and landlord.¶ Not all covenants will pass...they have to touch and concern the land...they
must not be personal between the parties but instead, be relevant to control over the land.

 
  ! "


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- µThe contractual obligations which touch and concern the land having become imprinted on the estate, the tenancy
is capable of existence as a species of property independently of the contract.¶ (per Nourse LJ)



s.141 Law of Property ˜ct 1925, µRent and benefit of lessee¶s covenants to run with the reversion¶
(1)Rent reserved by a lease, and the benefit of every covenant or provision therein contained, having reference to the subject-
matter thereof, and on the lessee¶s part to be observed or performed, and every condition of re-entry and other condition
therein contained, shall be annexed and incident to and shall go with the reversionary estate in the land, or in any part
thereof, immediately expectant on the term granted by the lease, notwithstanding severance of that reversionary estate, and
without prejudice to any liability affecting a covenantor or his estate.
(2)Any such rent, covenant or provision shall be capable of being recovered, received, enforced, and taken advantage of, by
the person from time to time entitled, subject to the term, to the income of the whole or any part, as the case may require, of
the land leased.
(3)Ñhere that person becomes entitled by conveyance or otherwise, such rent, covenant or provision may be recovered,
received, enforced or taken advantage of by him notwithstanding that he becomes so entitled after the condition of re-entry
or forfeiture has become enforceable, but this subsection does not render enforceable any condition of re-entry or other
condition waived or released before such person becomes entitled as aforesaid.
(4)This section applies to leases made before or after the commencement of this Act, but does not affect the operation of²
(a) Any severance of the reversionary estate; or
(b) Any acquisition by conveyance or otherwise of the right to receive or enforce any rent covenant or provision;
effected before the commencement of this Act.

s.142 Law of Property ˜ct 1925:¶ Obligation of lessor¶s covenants to run with reversion¶
(1)The obligation under a condition or of a covenant entered into by a lessor with reference to the subject-matter of the lease
shall, if and as far as the lessor has power to bind the reversionary estate immediately expectant on the term granted by the
lease, be annexed and incident to and shall go with that reversionary estate, or the several parts thereof, notwithstanding
severance of that reversionary estate, and may be taken advantage of and enforced by the person in whom the term is from
time to time vested by conveyance, devolution in law, or otherwise; and, if and as far as the lessor has power to bind the
person from time to time entitled to that reversionary estate, the obligation aforesaid may be taken advantage of and enforced
against any person so entitled.
(2)This section applies to leases made before or after the commencement of this Act, whether the severance of the
reversionary estate was effected before or after such commencement:
Provided that, where the lease was made before the first day of January eighteen hundred and eighty-two,
nothing in this section shall affect the operation of any severance of the reversionary estate effected before
such commencement.
This section takes effect without prejudice to any liability affecting a covenantor or his estate
Note: A lease is identifiable different from a contract through its ability to continue through change of ownership the rights
and interests concerned under the covenants on that lease.

***See: The Landlord and Tenant (Covenants) Act 1995***

(v) Breach of covenant (equates to damages)

- Ñhere a leasehold covenant is breached, the normal remedy is damages.
- Other remedies are available (forfeiture= right for tenant to forfeit his lease for breach of covenant)

(iv) Protection from Eviction Act 1977

- This stops people being evicted for due process
 - However, the act is one of the few pieces of legislation that applies to both terms of years absolute and licenses. (In
both cases you are entitled to only be evicted by court order)

  ::  

Designed to deal with modern living standards. Êhis gives people more rights!
(i) Commonhold and Leasehold
eform ˜ct 2002
- It is not a new form of property ownership!
- It exists as a µmodified¶ version of the free hold in absolute possession.







































0

>-8
.//



You always need to identify which TYPE OF RIGHT is present! Either legal or equitable interests.


0
.//

s.1(2)(a-c) LPA1925
(2)The only interests or charges in or over land which are capable of subsisting or of being conveyed or created at law are²
(a)An easement, right, or privilege in or over land for an interest equivalent to an estate in fee simple absolute in
possession or a term of years absolute; (an easement can be a legal interest if it is granted for the term of a legal estate)
(b)A rentcharge in possession issuing out of or charged on land being either perpetual or for a term of years absolute;
(no longer possible to create rentcharge - not important)
(c)A charge by way of legal mortgage;

7




>-8
.//

s.1(3) LPA 1925: µAll other estates, interests, and charges in or over land take effect as equitable interests¶
Key point: Equitable interest¶s whatever their nature cannot exist on their own. It must relate to someone¶s estate and
normally attached to an estate of your own.


< 
.0
.//

 
- .
 .:/

s.1 LP˜ 1925 µLegal estates and equitable interests¶
(1)The only estates in land which are capable of subsisting or of being conveyed or created at law are²
(a)An estate in fee simple absolute in possession;
(b)A term of years absolute

s.52 LP˜ 1925: µConveyances to be by deed¶

(1)All conveyances of land or of any interest therein are void for the purpose of conveying or creating a legal estate unless
made by deed.
(2)This section does not apply to²
(a)assents by a personal representative;
(b)disclaimers made in accordance with %55sections 178 to 180 or sections 315 to 319 of the Insolvency Act 1986), or not
required to be evidenced in writing;
(c)surrenders by operation of law, including surrenders which may, by law, be effected without writing;
(d)leases or tenancies or other assurances not required by law to be made in writing;
(e)receipts %56other than those falling within section 115 below);
(f)vesting orders of the court or other competent authority;
(g)conveyances taking effect by operation of law

s.53-µInstruments required to be in writing¶

(1)Subject to the provision hereinafter contained with respect to the creation of interests in land by parol²
(a)no interest in land can be created or disposed of except by writing signed by the person creating or conveying
the same, or by his agent thereunto lawfully authorised in writing, or by will, or by operation of law;
(b)a declaration of trust respecting any land or any interest therein must be manifested and proved by some writing
signed by some person who is able to declare such trust or by his will;
(c)a disposition of an equitable interest or trust subsisting at the time of the disposition, must be in writing signed
by the person disposing of the same, or by his agent thereunto lawfully authorised in writing or by will.
(2)This section does not affect the creation or operation of resulting, implied or constructive trusts

s.54-µCreation of interests in land by parol.(orally)¶

(1)All interests in land created by parol and not put in writing and signed by the persons so creating the same, or by their
agents thereunto lawfully authorised in writing, have, notwithstanding any consideration having been given for the same, the
force and effect of interests at will only.
(2)Nothing in the foregoing provisions of this Part of this Act shall affect the creation by parol of leases taking effect in
possession for a term not exceeding three years (whether or not the lessee is given power to extend the term) at the best rent
which can be reasonably obtained without taking a fine

s. 1(2-3) LPMP 1989- µDeeds and their execution¶

(2)An instrument shall not be a deed unless²
(a)it makes it clear on its face that it is intended to be a deed by the person making it or, as the case may be, by the
parties to it (whether by describing itself as a deed or expressing itself to be executed or signed as a deed or otherwise); and
(b)it is validly executed as a deed by that person or, as the case may be, one or more of those parties.
(3)An instrument is validly executed as a deed by an individual if, and only if²
(a)it is signed²
(i)by him in the presence of a witness who attests the signature; or
(ii)at his direction and in his presence and the presence of two witnesses who each attest the signature; and
(b)it is delivered as a deed by him or a person authorised to do so on his behalf.
s.2 LPMP 1989- Contracts for sale etc. of land to be made by signed writing.
(1)A contract for the sale or other disposition of an interest in land can only be made in writing and only by incorporating all
the terms which the parties have expressly agreed in one document or, where contracts are exchanged, in each.
(2)The terms may be incorporated in a document either by being set out in it or by reference to some other document.
(3)The document incorporating the terms or, where contracts are exchanged, one of the documents incorporating them (but
not necessarily the same one) must be signed by or on behalf of each party to the contract.
(4)Ñhere a contract for the sale or other disposition of an interest in land satisfies the conditions of this section by reason
only of the rectification of one or more documents in pursuance of an order of a court, the contract shall come into being, or
be deemed to have come into being, at such time as may be specified in the order.

s.27 Land
egistration ˜ct 2002 (for registered title only): In certain cases you will need more than a deed. You will also be
required to register the land.

 :: 
.//



Must be able to: Explain what the different interests are, identify them as either easement/mortgages, decide whether they
are legal/equitable rules (enforceability issues) and ensure statutory Formalities are in place for all.

34 /:/

µAn easement is a right attached to one piece of land which is exercisable over an adjacent piece of land. A right will not be
recognised as an easement unless it is sufficiently defined and benefits the first piece of land.¶



 )$%+
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c-c- List a series of requirements for something to be an easement.

Ñhat the law of easements does is to balance the competing rights of the owner of the dominant tenement (that is the
benefited land) and the rights of the owner of the servient tenement (that is the burdened land).

34 ?


µA legal easement can be acquired by an actual grant by deed¶,
- ˜ new legal easement created in registered land must be entered on the land register.
- A legal easement can also be acquired by a presumed grant. If a right is exercised for a sufficiently long period of
time the law will assume that there was once a valid grant by deed. This is called acquisition by prescription ±
Prescription Act 1832.
Ñe have seen that an easement granted for the equivalent of a fee simple or a term of years absolute is a legal interest. ˜n
easement granted for any other period, for example for life, is equitable and will required registration for protection. ˜n
easement granted in writing but not by deed is an equitable easement and will also require protection by registration.

374  .00/

µ˜ mortgage is the interest taken over an estate by a lender as security for his loan. It is a contract between a lender and a
borrower which gives the lender a proprietary right in the estate of the borrower.¶

- The right of possession is limited in the case of a house by s.36 Administration Justice Act 1970 and s. 8
Administration of Justice 1973 which gives the courts power to prevent a lender gaining possession where, for
example, the borrower can show that he can pay off any arrears of mortgage payments in a reasonable time.
- A mortgagee powers: Before the mortgagee can sell there must be at least 2 months arrears of interest - s.103 Law
of Property Act 1925.
- Mortgagee must exercise care to get the true market value for the property ± $ 

,
$$

  

%c&6c)

&+& The must pass on the rest of the proceeds of sale to the borrower.
?
 ??
Created by deed. A lender takes a charge by deed expressed as a legal interest by s.1(2)(c) Law of
Property Act 1925. A lender taking a first legal mortgage of unregistered land who, as is normal practice, takes the title
deeds is protected. All other legal mortgages of unregistered land need to be protected by registration. Any legal mortgage of
registered land must be entered on the land register.
!7
 ??
A mortgage which is in writing, but not by deed, will be an equitable mortgage and will need
to be protected by registration.
 34 /.,
 ,/

µ˜ restrictive covenant is an agreement between two freehold estate owners limiting the use of the land of one of them for the
benefit of the other¶.

- A covenant can always be enforced between the original parties to the deed
<
 <
3one that does not require money to be spent). Only be enforceable, other than against the
original covenantor, if it relates to the land and not to be person. Registration required to protect RC!
- It must touch and concern the land
- Person seeking to enforce the covenant must have a legal estate in the land benefited by the covenant. In addition
the benefit of the covenant must have been annexed to the legal estate
^ 


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Annexation is now largely regarded as automatic. Special rules allow


  
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Special rules allow restrictive covenants on a housing estate to be enforced by and against any
owner of a house on the estate.

SEE EXTRA NOTES HANDOUT!

#.  


.//
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.
./

There are two types of doctrine of notice:

34 -

- Actual notice is being aware of the interest
- / c&'
#
c&*2: Under the unregistered system you can have deemed actual notice where you are not actually
aware but the law assumes that you to be.

34  /.-,

- ˜ purchaser will be deemed to have notice of all matters which he or she could have discovered if they made the
usual and proper enquiries.
- As a purchaser, you cannot ignore facts that might highlight an interest being present then you will be fixed with
constructive notice. Onus is on a purchaser to prove that they are a BPFVÑN. (equities darling)

s..199 LPA 1925: µRestrictions on constructive notice¶

(1)A purchaser shall not be prejudicially affected by notice of²
(i)any instrument or matter capable of registration under the provisions of the Land Charges Act, 1925, or any enactment
which it replaces, which is void or not enforceable as against him under that Act or enactment, by reason of the non-
registration thereof;
(ii)any other instrument or matter or any fact or thing unless²
(a)it is within his own knowledge, or would have come to his knowledge if such inquiries and inspections had been made as
ought reasonably to have been made by him; or
(b)in the same transaction with respect to which a question of notice to the purchaser arises, it has come to the knowledge of
his counsel, as such, or of his solicitor or other agent, as such, or would have come to the knowledge of his solicitor or other
agent, as such, if such inquiries and inspections had been made as ought reasonably to have been made by the solicitor or
other agent.

Purchaser will be deemed to have Constructive Notice:

(i) Ñhere the purchaser is aware that person X has an interest but they are not aware what type of interest. If the
purchaser could have found out the extent of this interest through enquiry, then they will be fixed with
constructive notice. Eg, beneficial interest behind a trust which does not appear of the legal title.
(ii) In circumstances where you purchase the property and do not try to find out the full extent of the interests in
that land at all. (You will have constructive notice for failure to take any reasonable action)
(iii) Ñhere a person fails to make proper enquiries through carelessness.
***[The reasonable enquiry would be needed where there is something in place contrary to the rights of the purchaser]***

º  %$
  ,
%c&'5)
3.
/
/4

šCombination of different facts gave rise to constructive notice}
Facts:
- Mrs T had BI in property and Mr T legal oner. (family home implied trust)
- Mrs T has contributed over the years; it had been established Mrs T has a beneficial interest behind a trust.
- Mrs T left the house but visited the children µalmost¶ every day. (except on Sundays)
- Mr T tried to sell and arranged a surveyor to visit the property on a Sunday.
- In addition, he hides Mrs T¶s clothes when the surveyor visits in order to obliterate any sign of her presence.
- Mr T then represented to the surveyor that he lived alone.
- The surveyor arrived but failed to draw a conclusion from the photographs listed throughout the property-=

 ?

 1@<
7

!

Held:
- In view of all these collective factors, the surveyor had constructive notice of Mrs T¶s beneficial interest as he
should have been put on further enquiry. The surveyor had constructive notice, however he was employed by the
mortgagee and this was an agency relationship. Therefore, if the agent is fixed with constructive notice, then the
mortgage company are also fixed with constructive notice. [

#1#1
 )


 ,..0

For overreaching to take place there are two conditions:

(i) The interest must be capable of being overreached (overreachable);
(ii) There must be an overreaching sale. (Purchaser pays money to two or more trustees or a trust corporation).

Aim of overreaching sale under s.2 LPA 1925:

- Make land alienable
- Reflect the mirror principle more efficiently
- Unburden the buyer

LPA 1925:
s.2 (1): This tells you what overreaching is; and how the process works under certain circumstances.
(2): This outlines what is an overreaching sale (is it an overreaching sale?)
(3): The exclusions to an overreaching sale.

Key point:
- The process of overreaching takes away the beneficial interest (life interest/trust) and instead gives that beneficiary
a representation of that interest in monetary value. /

- 
,..-
8
//
,-




- Note: s.27 (2) LPA is the purchasers equivalent of s.2 (2).

Application of the above principle as per s.2 (2): OVERREACHING SALE NOT ALÑAYS POSSIBLE
=0/ .
.-/

,
A.
%c&'5) Mr T was the single trustee pertaining to the beneficiaries¶ equitable interest under
the trust. Therefore, if someone were to purchase his house, it could not be deemed an overreaching sale under s.2 (2) LPA
1925. He was trustee beneficiary as he had both legal and equitable ownership. Mrs T was not a beneficiary.

Definition of Purchaser: s.205 (xxi) LPA 1925:

³Purchaser´ means a purchaser in good faith for valuable consideration and includes a lessee, mortgagee or other person
who for valuable consideration acquires an interest in property except that in Part I of this Act and elsewhere where so
expressly provided ³purchaser´ only means a person who acquires an interest in or charge on property for money or money¶s
worth; and in reference to a legal estate includes a chargee by way of legal mortgage; and where the context so requires
³purchaser´ includes an intending purchaser; ³purchase´ has a meaning corresponding with that of ³purchaser´; and
³valuable consideration´ includes marriage [F207, and formation of a civil partnership,] but does not include a nominal
consideration in money

ºey point:
- Ñhere you are granting an easement or a mortgage to someone then you are regarded as a purchaser under this
section. You do not have to be buying the estate but merely creating interests. If you are granting mortgage money
for an overreaching sale, it has to be to two trustees or a trust corporation.




  
7- 0
 
,
00
%c&'6)


- If you have notice (actual or constructive) it is not relevant as you cannot be bound by an interest that is capable of
being overreached.
7.:0:
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.,/

,
8.
3*(((4


- This was a case where an interest arose, not by means of a resulting or constructive trust but because of proprietary
estoppel.
- HELD: That an interest arising by estoppel could be classed as an equitable interest and could be overreached as
result of this. (Applied Flegg [1987])

7B


 
,

%c&&6)
c


c5&
3 4

- Issue, µwas the mortgagee a purchaser where there was no actual money advanced¶? Money was advanced but it
went against paying of an existing debt. At law, if you discharge a debt, this is not µtechnically¶ at law an µadvance
of money¶.

- Held: They asked whether overreaching can take place outside of s.2 LPA 1925? [Specific to s.2 (2)]. In these
very limited circumstances (facts of this case), overreaching can take place.

u Ñorking example of overreaching principles above:

µHouse to Debra for life, remainder to any children she might have¶
- You know this can only exist behind a trust and both parties have an equitable interest. If the property is sold
during her lifetime and the purchase money is paid to two trustees, then she is entitled (and her unborn children) to
an interest in the monetary value of the proceeds of sale. This is possible as her interest is beneficial and is capable
of being overreached. (s.2 LPA 1925)
However:
- If the purchase money is paid to only one trustee, then no overreaching takes place. Ñhy? Although her interest is
overreachable, there has been no overreaching sale taking place as it does not satisfy s.2 (2) µtwo or more trustees
or a trust corporation¶. Ñhether her interest would then bind the purchaser, would depend on the doctrine of notice
(actual or constructive) and those rules would then need to be applied.
?1
1

. - 

- Parliament created s.1(1) LPA 1925- Limitation to only two forms of legal estate ( freehold /leasehold)
- The system of unregistered titled was only an interim measure.
- If an estate in land is not registered, then you must prove µgood route of title µof 15 years prior.
- Unregistered estates can have certain interests registered as µland charges¶ under LCA 1972.
- Ñhere an interest is not capable of being registerable as a land charge, then the old rules of µdoctrine of notice¶ are
applied: 
.-
/
Legal interests bind the world; equitable interests bind according to the doctrine of
notice.

u Ñhat interests are not registerable?

7

./
7
.-/
Every time you have a beneficial interest in land, it happens behind a trust
in land. (Trust of Land and Appointment of Trustees Act 1996 s.1). They are not capable of being protected as such interests
are supposed to be capable of being overreached at sale.


/:


0/. 

s.2 LCA 1972: Outlines which charges are registerable and divides them into 6 classes of registerable interests. (Class A-F)


34 


.0/

(i) Pusny Mortgage:
$ If you are granted a second legal mortgage as a mortgagee you cannot retain the title deeds as these will be lodged
with the first legal mortgagee. Therefore, even though it is legal, it has to Registered under the Land Charges
system to be effective.

(ii) General Equitable Charge:

$ Any interest which isn¶t listed anywhere else will be a general equitable charge unless excluded by the subsection
within this piece of statute. (Class C under the LCA 1972 s.2)

(iii) Contract to create an Estate:

$ A person has not yet created a Deed but has contracted to so in the future. This includes an option to purchase
property or contracts to renew leases.

374 //
1

.0/

(i) Restrictive Covenants (D2 Land Charge)
(ii) Easements (Only Equitable) (D3 Land Charge)

34 //


.0/

9 -//
/- .
.0


- @

$ µA charge affecting any land by virtue of Part 4 of the Family Law Act 1996¶
$ Lord Denning¶s deserted wife¶s equity¶ theory overturned by #7
,
/ .
%c&52)

cc62
$ #.
+
3/ -(4



:


c&&5: Êhis gives the spouse who is not already the legal owner, a right not to
be excluded from the home.
Two requirements:
(i) A spouse ( or as per Family Law Act amendments- civil partnerships)
(ii) You have to not appear on the legal title.

Practical effect:
$ This, when registered, requires that a spouse must consent to any selling of land or creation of interests within it.
$ ^owever, very few people are aware that they can register this right to protect their right to consent.






0/.0


.0

A person must:
$ Register land charge personally against the name of the estate owner.
$ / c&'
#
c&*2: Registration of a land charge against the name of the estate owner binds the purchaser. It is
deemed actual notice
$ / c&&
3c4
#
c&*2: A registerable land charge is void for non-registration and is unenforceable against a
subsequent purchaser. The doctrine of notice not applicable. (STRICT APPLICATION)


  $
 
%c&'c)

Facts:
$ Concerned an estate contract in the form of an option to purchase which was given by a farmer to his son.
$ An option to purchase is a right to a contract of sale. However, it is only enforceable if you exercise the option. At
the point when you exercise this option, then a binding contract will come into existence.
$ Farmer and his son fell out and ended up hating each other. The son had not exercised the option as a result of this.
$ The farmer then conveyed the farm to a third part for a price far below market value but only to defeat the sons
option to purchase.
$ This issue was that the 3rd party was aware of the son¶s option to purchase.
$ However as it was unregistered land, the son had failed to protect this as C4 land charge (estate contract).
Held:
$ The court agreed with the farmer and held that if you do not register a land charge against the land owners name
(personally), you cannot claim actual or constructive notice (s.199)- [HL unanimous verdict]
$ It was also held that µbad faith¶ in selling the farms at a gross undervalue was irrelevant.



.-/

.
 $0/. 


.//

/ +

c&6* provided two separate systems which are dependent upon the type of interest not registered:

//
C7C34$34

//


.0/

%/ +3*4$3-4$324$3'4)

Non registration will be void as against a purchaser of the land or any interest in such land where they have 0,
,-8

 / . . It will however be binding against non-purchasers where the transfer of land is by way of gift.
Note:
(a) The definition of a purchaser would include a mortgagee as per #
c&*2
/ *(23c43""4
(b) Valuable consideration does not have to be adequate consideration [ B
7B
,
 B]
(c) Valuable consideration need not be money: Marriage Consideration.

//

3,4
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//
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Non registrations will be void against a purchaser of a legal estate in land who 0,/
: 
.
: @/
 .
of a 0

/ in land. Even if unregistered, a Class C (iv) or Class D land charge µcould¶ be binding against someone who is
creating an >-8
./ in land. rote: Ñhere someone is not a purchaser, they will be bound by the unregistered
interest. An unregistered land charge of whatever type may bind someone who is given a gift of land.

#. .
0/. 

$ The Land Charges register requires you to register the interest against the owner of the land. So in this sense you
have to make sure you register this against the correct legal owner. [name of the estate owner at the time of
registration- s.3(2)]

   
 

 
3c&6*4
*-
#E
-+5

Facts:
$ A wives statutory right of occupation under the then Matrimonial Homes Act. Ñife tried to register a Class F land
charge and she registered against Erskine Alleyne (not the full name). A search was then carried out on the Land
Charges registry against the full proper name and her charge did not show up under his correct full name.
Held:
$ The finance company (purchasers) took free of any charges as the wife had not properly registered the charge.
$ The search being conducted must also be done using the correct full name and if not, then a person will be bound
against that which would have been there under the correct full name search. (search)
 7


?
?1
1

Identify Nature & #./ 

Inherent Validity Purchaser
of Interest Not Bound

Proprietary
and Valid

Registrable under
LCA 1972?

0/.8 Is  
0/.8
Right Actually Is Right Legal or
Registered? Equitable?

  Void Against / Purchaser

Most Purchasers. Bound
Apply ss. 4(5)
valuable
consideration &
4(6) money or 0 >-8 Is
moneys worths All Right
LCA 1972. Purchasers Overreachable?
Bound S.2 LPA 1925
&S.27

/ Has  C
.

-

Overreaching ,..0 Is Purchaser
Taken Place? b.f.p. w/o notice?

/ Purchaser / Purchaser   Purchaser

Not Bound Not Bound Bound


?1
1

1. Difficulties with Unregistered Land

$ The estate owner must physical prove entitlement to the land by showing deeds that derived title from a person
who has been in peaceful possession for a period of 15 years or more.
$ Certain interests in the land still depend on the doctrine of notice to give protection. (beneficiary behind a trust)
$ The unregistered system is of decreasing importance but much of the registered system finds dependence on the
registered system (building blocks)

2. Registered Land

$ Official copy of the register and title plan from the Land Registry (this is proof of title).
$ The title to the land itself is registered and is guaranteed by the state.(insurance principle)
$ Almost all encumbrances (third party interests) are protected by registration with the land registry- subject to
certain exceptions (overriding interests).
$ Those third party interests that are not protected by the register may become protected via actual occupation. (only
use this phrase in registered land)
$ The doctrine of notice has no relevance in registered land.

Mirror Principle:
$ The idea is that the register should act as a mirror which reflects the full facts material to the title. However, cracks
will form in the mirror due µto interests that override a disposition¶.
$ The LRA 2002 has reduced the extent of these µcracks in the mirror¶ by decreasing the OI¶s. .

-  #-. /


0/.

/:

$ Only interests capable of subsisting at law under s.1 LPA 1925 (legal estates and legal interests) are registerable as
registerable interests.

$ You cannot have a different right in registered land than you can have in unregistered land as only µrecognised
land law rights¶ are capable of protection. ( the law has not changed, only the system)

+  
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c&*2 [L
˜ 1925 is in italics]

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Land
egistration for the 21st Century: ˜ Conveyancing
evolution, 2001, Law Com No.271
µThe fundamental objective of the Bill is that under the system of electronic dealing with land that it seeks to create, the
register should be a complete and accurate reflection of the state of the title to the land at any given time, so that it is possible
to investigate title to land on line with the minimum of additional enquiries and inspections¶ (para.1.5)

  
? 




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L
˜ 2002, s.6: µDuty to apply for registration of title¶

) 

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Practically people will not voluntarily invoke registration, therefore the system continues to have cracks.
*  
0/.



The registration is of the individual title and evidence of this registration is given to the registered proprietor through a Êitle
Information Document.

The Title Information Document includes: (New to the LRA 2002)

(i) Property register:
$ This will also include µbenefits of the land which are held¶.ie, easement
(ii) Proprietorship register:
$ The nature of the title held (categories of title)/ Name and address of registered proprietor
$ Sets out restrictions to the land.
(iii) Charges register:
$ Contains entries of rights adverse to the land which are protected by rotices.

L
˜ 2002, s.66 - µÊhe register is now open public inspection¶

L
˜ 2002, s.27 and sched.2- µro register of a registered estate is complete until there is entry on the register system¶
Registration Gap--The period of time between the transfer and registration period. E-Conveyancing will ensure transfer and
registration takes place simultaneously and will make this issue void]

  - )

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$
  (!!)!!!!!# !! 
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Dermanent B ld ng Ô et v ½am n (1998)
$ Ñ !!!!   $  
#8›
99
›eeman v M ammed (2001):   !"  $ $ " 
  !

A/C: 1" 
The e-conveyancing system will change the process from of title, to title by registration.

0 ./




Upon first registration of land, the registrar will give one of the following categories to the owner based on the route of the
title and the proof of such title:
[s.58 LRA: Registered proprietor deemed to have been vested with rights as per register]
8/ -: Generally given to freeholds.
s.9(5) LRA 2002- Already registered
s.11 LRA 2002- 1st registration
# //// .
Given where there is insufficient evidence to allow absolute title.
!-
 
Fundamental defects with route of title.
?
/  
Absolute title, except that is subject to any interests affecting the landlords freehold. s.12(6) LRA 2002

L
˜ 2002, s.62 ±
egistrar can upgrade the lesser titles:

1" $This will be taken into consideration for qualified title if it is felt that it may later be possible to upgrade the
title.

  0

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L
˜ 2002, s.58 ± µEntry on the
egister is Conclusive¶

1" $
Fundamental link to the states guarantee of title (insurance principle) and it must be presumed so until
something otherwise is proved differently.


L
˜ 2002, s.11 Effect of First time
egistration F
EE^OLD ÊIÊLE
(4)The estate is vested in the proprietor subject only to the following interests affecting the estate at the time of
registration².
(a)interests which are the subject of an entry in the register in relation to the estate,.
(b)unregistered interests which fall within any of the paragraphs of Schedule 1, and.
(c)interests acquired under the Limitation Act 1980 (c. 58) of which the proprietor has notice..

L
˜ 2002, s.12± Effect of First Êime
egistration LE˜ÔE^OLD ÊIÊLE
(4)The estate is vested subject only to the following interests affecting the estate at the time of registration².
(a) implied and express covenants, obligations and liabilities incident to the estate,.
(b) interests which are the subject of an entry in the register in relation to the estate,.
(c) unregistered interests which fall within any of the paragraphs of Schedule 1, and.
(d) interests acquired under the Limitation Act 1980 (c. 58) of which the proprietor has notice..

L
˜ 2002, s.23 ± Owner¶s Powers over the
EGIÔÊE
ED EÔʘÊE
Owner¶s powers over a registered estate allow them to make a disposition of any kind in relation to the land but not a
mortgage by demise (only a charged mortgage can be created)

L
˜ 2002, s.26 - Unlimited
Seems to protect a purchaser because the conditions of this section infer that the registered proprietor has the right to
whatever it is they seek to carry out; therefore protecting the purchaser¶s subsequent conveyance of the property. The
disponee will not have any questions as to their rights to title.






#. .

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/ / /


Once land is registered, any subsequent transaction in relation to the new purchase and third party rights in that estate will be
subject to / *'



-


/
/

/ *&
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/ -(

L
˜ 2002 s.28 µÎasic rule¶
   "   "7"#$ !
:;9

:;9  4. #  $! # 
 !3#!<<<
L
˜ 2002 s.29 µEffect of registered dispositions: EÔʘÊEÔ¶
()5!!#$  
!  !   !  
 "   !
()
 ()$  =
() $ =
()! ! * !$
()"   ! ' ;$
() ! !$
()  $   
(;)'()()() "    * ! 
 ! 
(>)Ñ  ! !##!$ 
 =
() !## $
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L
˜ 2002, s.30 µEffect of registered dispositions: charges.¶- MO
ÊG˜GEÔ
^
.  
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%*((')
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c5&*

$
s.28 did applied

This case involved a complex mortgage fraud with two competing equitable interests. It was held that s.28 applied, meaning
that the first in time applied and took precedence. The reason why s.29 didn¶t apply even though there had been an
intervening transfer of property was that s.29 requires valuable consideration to be given for a registerable disposition of a
registerable estate and in the current case, there was no valuable consideration of the later transaction due to the fraudulent
enterprise.

 



?1
1

You have to decipher where your interest fits within the system and it will ultimately fall within one of the following
categories: (note: they are not listed in the LRA 2002)

0/.8
.//


Situation: The land is already subject to the registered system-

L
˜ 2002, s.27-¶Dispositions which must be completed by
egistration¶
- Outright Transfers
- TOYA¶s of more than seven years from the date of grant.
- Express grant or reservation of an interest of a kind falling within s.1(2)(a) LPA 1925: - Easements for an interest
equivalent to an estate in fee simple absolute or a term of years absolute. (Deed Required)
- You would need to know how long the easement had been granted for in order to know if its suffice. Ie, it must be for a
fixed period (TOYA) or for ever (FSA).
- the grant of a legal charge


0/.
.0/

L
˜ 2002, s.30- Separate section for Registered Charges regarding priority of interests
L
˜ 2002, s.27 (3)
(;)5 ! !$ "! "   
!=
()$
() !2 !
L
˜ 2002, s.132 ± definition of registered charge
$ µA charge the title to which is entered in the register¶

.//

,.. 

1/ / 

$
,.. 0
.//

Interests that are not protected in anyway, but they override a registered dispositions (bind them). If you have one of these,
they bind a third party purchaser of an estate or a charge without them appearing on the register. Crack in the mirror
principle in action.

L
˜ 2002, Ôchedule 1 ± ˜pplicable to first time registrations

L
˜ 2002, Ôchedule 3- ˜pplicable to already registered land.
Ôee s.29 & s.30- These sections back up the concept of overriding interests regarding priority of rights.

.//
8


70
#. 
8
.


0/.

There is no list of these residual interests; As it is merely everything else that is left over from the above three categories.
[Used to be called µminor interests¶]
L
˜ 2002, ss.28-29
$ They can be protected if they are registered; however, they are also capable of being over overreached.


#  





.//
#. 
7
./


0/.

All rights and interests which are not in the first three categories will fall within this residual category. Their capacity to bind
will rely solely on if they have been registered. A purchaser will not be bound by an unregistered interest of this nature even
where they have actual notice except in very limited circumstances. (see bad faith & constructive trusts below) If an interest
is protected, the purchaser cannot plead that they are BFPFVÑN- as noted in Parkash v Irani Finance ltd [1970]

-.

#. 
./

Basic rule is that if the [old term: minor] interest is not protected on the register, then it will not bind the purchaser.

$    Ú% 
3c&6-4I

There used to be certain Exceptions to this rule, however see the following:
+ 

%c&66) Brother in law bad faith against unregistered interest on non-legal owner.



O

ÑGrounds (1) If the purchaser took in bad faith (equitable fraud).
  [Decided under the LRA 1925] It was binding, as the ex-wife aware of the previous agreement. The court went on to
say that the definition of a purchaser under the 1925 act was held to include a purchaser in good faith and so the court felt
they could go outside the scope of the act in this circumstance.

Ñ
Ñ

Law Com ro.254, para.3.4: LRA 2002, s.29 makes it clear that neither bad faith nor actual notice will impact on an
unprotected interest LRA 2002 as this provision of µgood faith¶ no longer appears.



 $

%*((c)
There is no general principle which makes it unconscionable for a purchaser to rely on lack of
registration even when they took with express notice of the interest which wasn¶t protected. Hence, it¶s not unconscionable
for a purchaser to say µI¶m not bound by an interest which should have been protected even if I knew about it.
1
A
decision to the contrary would defeat the whole purpose of the legislature introducing the registration system in the first
place.

1
Ñ
Grounds (2) Constructive trustee:

#

.
,
00
 @  They took the land expressly subject to an interest they knew about which had not been protected and
therefore they held the land on constructive trust for the other brother in law.

$ +* 
! 

%c&'*)

Facts: Plaintiffs had contracted with builder to buy a plot of land and to have a house built on it, (An estate contract present
which needed registration to be protected. The estate contract had not been protected. The building company ultimately went
into liquidation and the bank (as mortgagee) sold the plot to other developers who agreed that they took it subject to the
plaintiffs estate contract and then the land was sold onto another set of 2nd defendants which was again subject to the
plaintiffs estate contract.
  The defendants held the land on constructive trust for the plaintiffs and had to give effect to the estate contract. The
court here went onto say that the defendants couldn¶t rely on provisions within the LRA 1925 requiring such interests to be
registered as in doing so (based on the facts of this case) then that would be to use the statute as an instrument for fraud.

A/C DIXON: It could also be argued that the LRA 2002 s.29 &s.30 could also be used as an instrument for fraud; however
in contrast to this, the LRA is in place to provide a much more effective mirror principle. To give weight to a person who
does not register an interest for protection would defeat the purpose of the statute itself.



#. ,
./
- .


*((*

Ê "!"  "    !
Ê  !,›
99Ê    
!r
!)`



L
˜ 2002, s.77 ± duty on application

" !     #
! 

  .



9 @

L
˜ 2002, s.32 ± µrature and Effect¶
()
  ! !! !
()Ê   ! !  
(;)Ê   *   #$
    $#$ ;9

L
˜ 2002, s.29(2)(a)(i) ± µbinding upon purchaser¶: An interest will take priority if it is the subject of a notice in the register
and will therefore bind a purchaser.

L
˜ 2002, s.33 ± µInterests that cannot be entered as a notice- Excluded Interests¶
.-/


 : A trust of land cannot be protected as a Notice; However it will be noted below that a restriction will be used
instead!

/ 
/

 
Ñhich is granted for a term of years of three years or less from the date of the grant, and is not
required to be registered.

/.,
 , : 
8

// .

//. This is only concerning terms of years. Restrictive covenants
between Freeholders would be capable of protection under s.33 L
˜ 2002.

L
˜ 2002, s.37 ± µ
egistrar may enter rotice¶
If it appears to the registar that a registered estate is subject to an unregistered interest which overrides at first registration, he
may enter a notice in respect of that interest provided that interest is capable of protection by means of a notice.

1J : These are neither agreed nor unilateral but may become known as registrar¶s notices. The ideology behind this
is to greater strength the true effect of the mirror principle.
) 

,`
57-r'8 
&
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   ##!"" 

#

 

L
˜ 2002, s.34(3) ± ˜greed rotice
Example: A agrees with B to create an estate contract. The purchaser then wishes to register a Notice protecting this estate
contract. Ñhen the registered proprietor agrees with this, then it becomes a registered µAgreed Notice¶

L
˜ 2002, s.35 µUnilateral rotice¶
The person with the interest goes along to the registrar and seeks to protect the interest by way of a Unilateral Notice. The
registrar then gives Notice to the registered proprietor about this entry, who can then agree or disagree.

L
˜ 2002 s.36 ± µCancellation of unilateral rotice¶
The registered proprietary can then ask for the cancellation of the notice. Practically, the registrar will discuss with both
parties and wipe out the notice or else upgrade it to an µAgreed Notice¶.

L
˜ 2002, s.73 ± µObjection to notice¶

   


%*(cc)
Ñ
,
'(c

L
˜ 2002, s.108, 111 - adjudication
Introduced under the LRA 2002:This gives the adjudicator jurisdiction in this kind of case. Following this, appeal is to the
High Court under s.111 LRA 2002.
8  /. 

//0"1/213

L
˜ 2002, s.40 µrature of
estriction¶
A restriction is an entry in the register regulating the circumstances in which a disposition of a registered estate or charge
may be the subject of an entry in the register. The restriction is a form of entry that places limitations on the registered
proprietors powers over the land.

L
˜ 2002, s.41 µEffect of a
estriction¶
(1)Ñhere a restriction is entered in the register, no entry in respect of a disposition to which the restriction applies may be
made in the register otherwise than in accordance with the terms of the restriction, subject to any order under subsection (2).
(2)The registrar may by order².
(a)disapply a restriction in relation to a disposition specified in the order or dispositions of a kind so specified,
or.
(b)provide that a restriction has effect, in relation to a disposition specified in the order or dispositions of a kind
so specified, with modifications so specified..
(3)The power under subsection (2) is exercisable only on the application of a person who appears to the registrar to have a
sufficient interest in the restriction.

L
˜ 2002, s.42 ± GErE
˜L POÑE
Ô OF
EGIÔÊ
˜
ÊO ErÔU
E OVE

E˜C^IrG
This is the main purpose of restrictions. It will let prospective buyers be aware of the fact that they cannot do as they please
with the land without having to pass monetary value to the persons with a registered notice under the overreaching principle.
s.41(1)(b): Securing that interests which are capable of being overreached on a disposition of a registered estate or charge are
overreached

L
˜ 2002, s.40(2)(b) ± µ
estriction very wide in rature¶

L
˜ 2002, s.44 µ OLÎIG˜ÊO

EGIÔÊ
˜ÊIOr Î
EGIÔÊ
˜
OF ˜
EÔÊ
ICÊIOr¶
If the registrar enters two or more persons in the register as the proprietors of a registered estate in land, he must also enter in
the register such restrictions as rules may provide for the purpose of securing that interests which are capable of being
overreached on a disposition of the estate are overreached.

L
˜ 2002, s.45 ± µObjections¶
(1)Ñhere an application under section 43(1) is notifiable, the registrar must give notice of the application, and of the right to
object to it, to².
(a)the proprietor of the registered estate or charge to which it relates, and.
(b)such other persons as rules may provide..
(2)The registrar may not determine an application to which subsection (1) applies before the end of such period as rules may
provide, unless the person, or each of the persons, notified under that subsection has exercised his right to object to the
application or given the registrar notice that he does not intend to do so..
 ,.. 0
.//$
µunregistered interests which override a registered disposition¶

L
˜ 2002, s.29(2)(a)(ii) ± effect = These are interests which bind without being evident on the registry and do not need to be
protected as they are binding in any event. - This SECTION outlines that the priority of an interest is protected if it falls with
any of the paragraphs of schedule 3. (this contains a list of overriding interests).


 , µOverriding interests ... provide a cavernous crack in the fundamental mirror principle under which the
register is supposed to reflect accurately and irrefutably the current facts material to a particular title.¶

Academics have argued that this overriding principle is just a statutory version of the notice doctrine.

L
˜ 2002, Ôched.3 ˜lready registered land: overriding interests.
L
˜ 2002 Ôched 1- Only applies on first registration of unregistered land : overriding interests


# 
 / . @/
8


*((*
Under the old s.70(1) of the LRA 1925 there were far wider lists of
overriding interest. This is important to show how the crack in the mirror is being ever increasingly decreased in size.

L
˜ 2002, s.117 µLOrG ÊE
M
EDUCÊIOr OF OVE

IDIrG IrÊE
EÔÊÔ¶
(1)Paragraphs 10 to 14 of Schedules 1 and 3 shall cease to have effect at the end of the period of ten years beginning with the
day on which those Schedules come into force.

L
˜ 2002, s.37-¶
egistrar Entering a rotice¶:
An interest that may have been capable of being an overriding interest, but has been entered as a Notice by the registrar, will
remain as a notice. (see above) and also the effect of L
˜ 2002, s.29(3)

L
˜ 2002, s.71- µDuty to disclose unregistered Interest when applying for
egistration¶
Ñhere rules so provide²
(a)a person applying for registration under Chapter 1 of Part 2 must provide to the registrar such information as the
rules may provide about any interest affecting the estate to which the application relates which².
(i)falls within any of the paragraphs of Schedule 1, and.
(ii)is of a description specified by the rules;.
(b)a person applying to register a registrable disposition of a registered estate must provide to the registrar such
information as the rules may provide about any unregistered interest affecting the estate which².
(i)falls within any of the paragraphs of Schedule 3, and.
(ii)is of description specified by the rules

rote: L
˜ 1925 s.70 µ
ights ˜cquired through ˜dverse Possession¶: 
     4

#
#

<1?


  //

.
//

6
./
3. c4

L
˜ 2002 Ôchedule 3 Para 1
A/C: The law had changed from requiring 21 years, to only 7 years. There is talk that this will be further reduced to 3 years!
Therefore increasing the number of registered leases and improving the mirror principle.

8  0
/:/

#.

/
3. -4

L
˜ 2002 Ôchedule 3 Para 3
(1)A legal easement which at the time of the disposition².
(a)is not within the actual knowledge of the person to whom the disposition is made, and.
(b)would not have been obvious on a reasonably careful inspection of the land over which the easement or profit
is exercisable..
Remember: Express easements fall under s.27 in most cases. Therefore the only easements that will be overriding easements
under this section are impliedly acquired. You can acquire a legal easement through prescription and this makes practical
sense as being an overriding interest.


 
 ^$^
 
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c
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34



$ Court interpreted the LRA 1925 very widely and felt that the section could include legal and equitable easements.

Note: LRA 1925 s.70 (1) (a) used to deal with this as stating µeasements not being equitable easements¶. The law now makes
it more obvious that only legal easements will qualify as overriding interests.

  / -/
3. c($c54

Chancel
epair Liabilities:
  
*+ Ñ

) 
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=
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2+5

$ The applicants failed.

 #./ /

-
- 
3. *4

L
˜ 2002 Ôchedule 3 Paragraph 2 =



An interest belonging at the time of the disposition to a person in actual occupation, so far as relating to land of which he is 2#?5'Ê53653Ê'Ê'53›
3 53Ê 
5 53653Ê'Ê'
in actual occupation, except for².
2
@"! <<<A#!
(a)an interest under a settlement under the Settled Land Act 1925 (c. 18);. 
(b)an interest of a person of whom inquiry was made before the disposition and who failed to disclose the right
=



when he could reasonably have been expected to do so;. 2Ê    
(c)an interest².  ,9()(!)›

(i)which belongs to a person whose occupation would not have been obvious on a reasonably careful 2Ê "! 
inspection of the land at the time of the disposition, and.  !#
23 Ê%0"99›

(ii)of which the person to whom the disposition is made does not have actual knowledge at that time;.
""<
(d)a leasehold estate in land granted to take effect in possession after the end of the period of three months 
beginning with the date of the grant and which has not taken effect in possession at the time of the disposition
=


Ê #!
Note: Old Law: L
˜ 1925, s.70(l)(g)  
! 5$ B"
Must be land law right of interest in land ! C!!
  
+  
   *%
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cc62
34
  
$ There is no such thing as a µdeserted wife¶s equity¶.
$ In order to have a land law right there needed to be a resulting trust or common intention constructive trust.

%)$  
  

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c
3)

$ Dealt with a contractual license. (only a personal rights)
$ Therefore, this was not an overriding interest under the then s.70(1)(g).

Only proprietary rights will do: For the avoidance of doubt, the LRA 2002 included the following sections to highlight that
they existed as proprietary rights-
L
˜ 2002, s.115- µ
ights of pre-emption¶
(1)A right of pre-emption in relation to registered land has effect from the time of creation as an interest capable of binding
successors in title (subject to the rules about the effect of dispositions on priority)..
(2)This section has effect in relation to rights of pre-emption created on or after the day on which this section comes into
force
L
˜ 2002 s.116- µProprietary Estoppel and Mere Equities¶
It is hereby declared for the avoidance of doubt that, in relation to registered land, each of the following²
(a)an equity by estoppel, and.
(b)a mere equity,.
has effect from the time the equity arises as an interest capable of binding successors in title (subject to the rules about the
effect of dispositions on priority).

Family Law ˜ct 1996, s.31(10) ± does not include statutory right to occupy =



s.30(10)(b)- A persons home rights are not capable of falling within Para 2 of Schedule 3. 2Ê  !  
 
#!
 2Ê + ! 
Ñ



 


 
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+'6
34
 
/ A bank was found to be bound by a wifes beneficial interest under a trust. Having advanced the mortgage monies to
just one legal owner (the husband) it had not successfully overreach the beneficial interest and this, coupled with the fact that
the wife was in actual occupation of the property, gave her an overriding interest binding upon the bank.
  Successful overreaching requires payment of the moneys to at least two trustees or a trust corporation. Ñhere a
beneficial interest has not been overreached and the beneficial owner is in actual occupation, it will bind a purchaser as an
overriding interest.

º  %  $  ,
%c&'5)

=




!$
$ Lord Ñilberforce in Boland [1981] had talked about physical presence but that this did not necessarily mean  <
continuous and uninterrupted.


 !  %% ^
%*((*)

ACTUAL OCCUPATION: In this case the land was uninhabitable and it was held that fencing the land and keeping
boundaries was suffice to amount to actual occupation of that land



))  
$
   
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=


  
This case decided the following points: › &+#%
2
!!
(1) ACTUAL OCCUPATION: Going in to measure up and having furniture moved into a house is not sufficient for actual
! +! 5
occupation.
(2) TIMING: The time for deciding whether a person was in actual occupation is the date of completion and NOT the date of
registration.
Note: This is a shorter time period and therefore narrowing the number of overriding interests that can exist.
NOÑ: under LRA 2002: It is noted as being at the time of the disposition.




 
 

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c

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34



ACTUAL OCCUPATION: Occupation can be through agents such as builders
It is going to be a fine line as to when actual occupation begins in those situations


%% %%
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34
=



Facts: The wife went into hospital for a period of time and when in hospital the husband tried to sell on the property. 2 #!# 
Held: ACTUAL OCCUPATION: (hospital case) Temporary absence from the property will not prevent a finding of actual 
occupation provided there is some physical evidence coupled with an intention of the temporarily absent occupier to return.

%

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$
$!  $
!%

//


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,
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=



Facts: A mental patient was sectioned under the Mental Health Act and was not able to be at her property for those reasons. 2
"   
Held: LJ Mummery Ratio: that she was still in actual occupation. Her personal effects still remained in the property. She Ê "+   
also made brief supervised visits to her house about once a week to collect her post. 



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Justice Lewison: Obiter comments only. '   #"
Timing of Actual Occupation: (As per Abbey Nation v Cann) It is the time of disposition taking place and not the D›"
registration. He did leave open whether there has to be actual occupation at the date of disposition as well as the date of
registration- he thought you needed both dates.

% 

 +

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*622
3!74K
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ACTUAL OCCUPATION: Ñife was supervising major renovations in property on a daily basis and it was intended that she
would live there after the renovation was complete.
Mr Justice Ramsay: She could prove actual occupation.


















#. ,/ /


 -
-
#.
*

O.I must relate to the specific land where there is actual occupation:
 %$ Ñ

 
%c&&&)

-22
3)
Under the new law in LRA 2003 the overriding interest must relate to the specific land where there is actual occupation. This
provision overturns the finding in this case which was based on the LRA 1925 S.70(1)(g) which did not include this intricate
detail.

Estate Contract creating an overriding interest:

Ñ)) +

$ 
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2'+
3)
This case found that due to the land being registered land: 
/
 . + actual occupation = o.i
**However it is worth noting that in unregistered land this would need to be protected as a Class C(iv) Land charge even if
the purchaser is aware of this interest. (Midland Bank Trust v Green)**


.!   %$
5
+) 
"3/6
µ˜n interest is not overriding if it is the interest of a person in whom inquiry was made before the disposition and who failed
to disclose the right when he could have been reasonably expected to do so¶

^ +
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+ =



  +"
Married couple bought a property from the wives parents. The property was bought for £25,000 which was less than market !!!
   "#$  #   
value and there was also a loan taken out from Lloyds Bank for £17,000. The reason for the property being sold was to avoid
   
her father having the house taken of him by the trustees in bankruptcy. The parents continued to live there as their home and   7"#$ 
they paid of the Lloyds Mortgage. "   !  
However, contrary to the agreement between the parties, the property was not transferred back to the parents¶ names. !  "    
Following the divorce of the daughter, the property was transferred into the daughters sole name and she then took out a loan
with HSBC and supplied a forged document which showed her father as a an assured shorthold tenant.
The daughter then became bankrupt and HSBC sought possession of the property but the father is still alive living there.
 
The couple held the property on constructive trust for the parents and the father as the sole beneficial owner left alive,
was entitled to the entire property. His interest (constructive trust) was overriding as he was in actual occupation throughout
the time. He was entitled to a transfer of the property to him free from any mortgage charge. HSBC could have avoided this
by making inquiry as to the father¶s actual occupation; however in failing to do so, he acquired an overriding interest.


+ =


Ê #
 %  
µ˜n interest is an overriding interest if the occupation would have been obvious on a reasonable careful inspection or if the  #7"#$ ()
 "  ++"
purchaser has actual knowledge of it¶
"   +
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Ê 
 !5 *
  #FFF
 27"  F
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5
3Ê<<


 =


" Bland [1981]
 Ê  " & "
 
  $
   

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2+
34  !""  !!"
2 "#
!!()
There was more than one legal owner in this case and meant that the interests were overreachable.


+  $
     
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3) =


#"   
Owner beneficial interest can give up their priority to the property. !"2" !#
 # 
  

rote: s.70(1)(g) used to protect those that were in the receipt of rents and profit therefore. ^owever it has not been =


Ê !#
2 +" #  
maintained by the L
˜ 2002 and so you can longer claim an overriding interest purely because you are in receipt of rents &
!#!# 
profits.
 $   *


%c&52)

&2'
34

7   
1
1

The register is guaranteed by the state; however there will be circumstances where there
register is wrong and alterations need to be made to the register. In doing so, a person is more
than likely to lose out. This is where the following two concepts arise. This will take place
through either rectification or indeed non rectification. The terminology has changed under
the LRA 2002, however the principles remain the same.

1. Alteration =




2Ê +
L
˜ 2002, s.65 and sched.4 Para 2 (courts powers) & 5(registrar powers) allow the court or ! !!#
the registrar to make alterations. "   
rote: Êhe registrar can also remove a superfluous entry. !

Para 3 & 6 give protection to a proprietor in possession. =




2
 ! 
 "  
  " 
 

2. Indemnity 2Ê  +  
This will arise where the register should be changed in your favour but due to a proprietor in  
possession, it cannot be carried out. =




L
˜ 2002, s.103 and sched.8 ;›


LL
0.:
,.
LL


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<
1
 


1
=


Ôuggested reading:
Gravells, pp. 253-255; Smith, ch.14,17

   1 



The two different forms of multiple interests in land. This is either concurrent or successive
interest in the land. The trust is used for both forms of multiple ownership of the land where
the legal and equitable interests are separated.

 -..: µCo-Ownership¶
$ Êhose which are joint or held at the same time as each other e.g., the land is conveyed
to ˜ & Î.

-//,: =


  
#
$ Interests are held one after the other e.g., land is held on trust for ˜ and then for Î.
$ Historically land owners often wanted to provide for several future generations and to
ensure that the estate remained intact.
$ This was made capable through a successive interest in the land.
$ The private interest is to maintain the property within the family, however the public
interest is to have the property broken up and go outside the family in order that more
members of the public have good access to land. =



&›5 ›50
$ SLA 1925 maintained that you could no longer split up the legal estate, so that all
successive interest must now of necessity be only equitable in nature. =


Ê $
'
!!    
# #"   
 

 /
8

9$ 7 



:
"/

34 .
:
3
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$ The tenant for life holds onto legal estate
$ Very archaic


34 .-/



3 
c&&54
%
.:.
.-/

.
/
.$c&&5)

$ Legal estate in held by the trustees


$ This can accommodate both successive and concurrent interests in land

$ This can be used for both land and personlty.

Note:
$ Under both systems, the families¶ successive interests are both equitable. Both =


3Ê "
+<
methods have safeguards to ensure protection of beneficial interests.
$ Trusts of Land and Appointment of Trustees Act 1996 ± Any new successive interest
settlements and all co-ownership now use trust of land (latter converted in 1997 from
trusts for sale)

Overreaching: =


'*›
!
<<
$ Ñhen the legal estate in sold the beneficiaries proprietary rights will be changed into
monetary compensation and the purchaser will take the property free of the beneficial
interest.

Eg, To A for life, then to B for life, then remainder to C absolutely.

 $ B¶s interest will come into possession when A dies. At that time if the property has
already been sold, then this is when B¶s rights to the income of that land will take
effect.
$ The value of the equitable interest will depend on the maintenance of the value of the
land. B &C will both look to ensure that A does a good job in looking after the land
properly because that will impact on B & C¶s later interest.
$ The holder of the legal estate (tenant for life or trustees) is given sufficient powers to
deal with the land to satisfy the public policy in ensuring land is made alienable when
possible.
$ However, there also need to be safeguards that protect the equitable interests as well.




##

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1



<





 
7 
 
c&&5

c  7/
.--.



/:

SLA 1925, s.1(7)

$ A strict settlement would have come into existence whenever there was successive
interests in land and there was no trust for sale =


''"


ÔL˜ 1925, s.4(2) ± legal estate in tenant for life

&  #!  #   "( *
) ! * %
# $"  ! #  "$ $
"   # $ #!  #  

ÔL˜ 1925, s.19-20 ± who is tenant for life, has powers of tenant for life
$ The tenant for life is the person who has their beneficial interests in possession (ie,
they currently have the legal title under the terms of the strict settlement)

ÔL˜ 1925, s.30 ± Êrustees of the Ôettlement =



Tenant for life holds the estate
as a fiduciary and not for themselves. HE IS NOT
$ These people will often be given the power to sell the land but ofcourse the tenant for REGARDED AS A TRUSTEE UNDER THE
life has the power to sell. STRICT SETTLEMENT.
$ Trustees are specifically tasked with receiving moneys on sale and then holding this
on trust for the rest of the beneficiaries. =


Ê "# !
+   
$ Also regarded as statutory owners if there is no Tenant for Life and hold this title until Ê› ›

they can convey it under s.4 to the Tenant for Life. (ie, a clause in the strict settlement 
that requires the tenant for life to me married before receiving his interest)

*  # ./




 .


=



2Ê #
#+
ÔL˜ 1925, s.18 ± µOnly in accordance with ÔL˜¶ 2Ê "  
$ The tenant for life cannot deal with the legal estate unless it is expressly authorised " <

under the act.

ÔL˜ 1925, µÔtatutory powers¶

s.38-39
2 Tenant for life has power to sell the settled land but only for the best price possible. =


5
# !$  "+
"  #
s.41-48 µLeasings¶ !

- Power to let the land/lease it for the best outcome of the

s.71 µMortgages¶
- Power to mortgage the property only when money is being borrowed for the purposes of the
settlement as a whole. (legal mortgage)
- However, the tenant for life can use their own beneficial interest as security for the loan if it
is just to fund their own personal interests. (Equitable mortgage)

ÔL˜ 1925, s.110(1) ± µProtection of purchaser¶ =



3+!  
4 $ !$$!!$ !$ $ !! "        
! ! ! 
 " $! $# + #!# 
$$  $     
"$ #"   
.

ÔL˜ 1925, s.106 ± Cannot exclude statutory powers of tenant for life
2 Effectively precludes the exclusion of any of the powers of the tenant for life.
2 Any provision that purports to prevent a tenant for life within the terms of the
settlement which has the effect of hindering the tenant for life powers under the SRA
is void.

O
)(6859:%613
Provision: A tenant for life shall forfeit their interest if they cease to live on the land
Held: The court found that this is ineffective if the tenant for life wishes to sell the land
(which is allowed under the SRA subject to certain conditions). =


5  
* 
!  '

7  

1

c  . - 

There can be no new strict settlements in creation; it can only be a trust of land. (TOLATA
1996). However existing settlements (SLA¶s) that were in place when the act came into force
are still to be regarded as strict settlements. In addition, the Trust for sale (old) which used to
be in place is no longer used and all previous trusts for sale have been converted into Êrusts
of Land under ÊOL˜Ê˜ 1996.

ÊOL˜Ê˜ 1996, s.1 Meaning of ³trust of land´..

()5 
=
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$
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=



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2 Structure chosen by the SLA 1925 to be used by choice for successive interests in =


Ê " 
!5$ 
land and for concurrent interests in land the Trust for Sale was the only mechanism #!
that could be used. 
2 The underlying purpose of a trust for sale was to sell land. =


Ê  
! $ "  
2 This was due to the strong emphasis on sale based on the idea that the focus of the act # #"
was to make land alienable.
=



2 Technically Trustees were in essence required to impose a sale however; they BACKGROUND ON›







effectively used their powers to postpone this duty to sell. 2Ê  "  " 
 $    
2 In a trust for sale the Trustees had both the powers of tenant for life and a trustee   ! !!("   
combined as under the SLA 1925. '›
" "#  
  )
2 The beneficiaries under a trust of sale only had equitable interests in the property and 27 2" # 
they would only have the powers which the trustees chose to delegate to the "  ""
beneficiaries, which did not include the power of sale (remained with the trustees).   $ "#$
 2" 
2 However, one of the mechanisms in place to protect the beneficiaries was " 
overreaching. Another was consultation ($!)$()›

2 Finally the intervention of the court under the LPA s.30 (now repealed) and replaced =


3 +
by similar provisions in TOLATA 1996.
 "<

1 .


 ,./ 
9
.  


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BO›AND " !
2
The courts traditionally held that where you have a trust for sale the land must be "5½›EGG"  ""
sold and that the beneficiaries behind a trust for sale only had an interest in money, !"
not in land. This was based on the fact that as a trust for sale was ultimately meant to =


Ê"+" 
be sold, then equity looks upon what ought to be done as done. Hence, the land would "   
" (
Ê ›
Ê
-)
be sold anyway and therefore, the beneficiaries could only ever establish personal
=


Ê "  
monetary interest in the sale. This also kept in line with the 1925 legislation aims to ! +
protect the purchaser from being bound by a pre-existing interest.  "   "!
00
3c&'64
The court here followed the conversionist approach, the idea that the parents 

who contributed only had money in interests anyway and it was immaterial that they didn¶t =

 

2Ê !   "#
have a proprietary interest in the land. # !5  
7 
3c&'(4
The court categorically stated %   that beneficiaries behind a 2 #""  
trust could have a property land law which when coupled with actual occupation, could be an  # !
2Ê "  

6
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overriding interest. (anti-conversionist). The wife was held to have a proper land law right
even though it was an interest behind a trust. =

 

2 "+"! 
"     "

/ -(
#
 @ 
 &
2 Under this section, where 1 or more trustee refused to sell the property, any person !
2Ê   !
interested could apply to the courts for an order for sale. (This order could be made
as the court thinks fit). In exercising is discretion the courts began to look at the terms
and the purpose of the trust in place. In doing so the court started to realise the
practical µfiction¶ of the µfor sale¶ part of a trust for sale.ie, the general intention was
to keep the land and not to sell it on. However, the intentions of the parties will often
change over time and therefore, the situation at hand must be analysed too.


$%  2Ñ


  
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6-'
34


2 Four neighbours who owned a piece of land between them. Infront of their property
there was an empty space of land and the four neighbours decided the buy the area in
front of the land. Thye bought it with the aim of just keeping it in order to enjoy the
scenery infront of their houses. Ultimately one of the owners decided to enforce the
duty to sell (under s.30 LPA). The court said they could not enforce the other owners
to co-operate in the sale because the whole purpose of the trust was to enjoy the view.

 
 $
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2 Proposed reform which is later outlined through TOLATA 1996.

*  .-/



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The legal estate is vested in the trustees and they have an implied power to postpone sale
which is a power that cannot excluded.
ÊOL˜Ê˜ 1996, s.4 µExpress trusts for sale as trusts of land¶.
()5 #   $ 
#    $"  2
  " ! $  $

()'()"  $$  


(;)'()    .

There can be no duty to sell as per s.4 above and therefore the following section applies:
ÊOL˜Ê˜ 1996, s.3 µ˜bolition of doctrine of conversion¶
()Ñ   *$ !
 2"  *   $
  !
()'()  "  
 

(;)'* $()"  $$ 

-  .-//

As the holder of the legal estate, there are certain powers given to trustees.
ÊOL˜Ê˜ 1996, s.6 µGeneral powers of trustees¶
()
 ! $  # * 
 "" =

 
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()Ñ   *    "" 
! "   $ "  ()   #"
Ê  "!!  
"#   # !    # 2"    7 ÑÊ70
'Ê5››
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-$# 
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(-)Ê "   #$ $
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-(;)%  !"

" 
(,)Ê (-)    
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(8)Ñ       * $
$  "   "    # =

 
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All the powers under s.6 can be restricted by the disposition that creates the trust. Hence, where the
trust is expressly created, there may well be express terms that may remove some of the trustees
powers. =

 
Ê '›
"
 +" " 
Êrustee ˜ct 2000, s.8 µExclusion and restriction of powers¶ E
()'-,   # 
      
()5 ! +#!   
" -,$ " "  
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(>)'()() #* "    # 
 

The trustees can all or any of their powers via power of attorney to any beneficiary(s) of full
age who are beneficially entitled to an interest in possession. =

 
5$Ê› 
'›

ÊOL˜Ê˜ 1996, s.9 µDelegation by Êrustees
(1)The trustees of land may, by power of attorney, delegate to any beneficiary or beneficiaries of full age and beneficially
entitled to an interest in possession in land subject to the trust any of their functions as trustees which relate to the land.. =

 
Ê  " 
(2)Ñhere trustees purport to delegate to a person by a power of attorney under subsection (1) functions relating to any land #
and another person in good faith deals with him in relation to the land, he shall be presumed in favour of that other person to
have been a person to whom the functions could be delegated unless that other person has knowledge at the time of the
transaction that he was not such a person..
And it shall be conclusively presumed in favour of any purchaser whose interest depends on the validity of that transaction
that that other person dealt in good faith and did not have such knowledge if that other person makes a statutory declaration
to that effect before or within three months after the completion of the purchase.
(3)A power of attorney under subsection (1) shall be given by all the trustees jointly and (unless expressed to be irrevocable
and to be given by way of security) may be revoked by any one or more of them; and such a power is revoked by the
appointment as a trustee of a person other than those by whom it is given (though not by any of those persons dying or
otherwise ceasing to be a trustee)..
(4)Ñhere a beneficiary to whom functions are delegated by a power of attorney under subsection (1) ceases to be a person
beneficially entitled to an interest in possession in land subject to the trust².
(a)if the functions are delegated to him alone, the power is revoked,.
(b)if the functions are delegated to him and to other beneficiaries to be exercised by them jointly (but not
separately), the power is revoked if each of the other beneficiaries ceases to be so entitled (but otherwise functions
exercisable in accordance with the power are so exercisable by the remaining beneficiary or beneficiaries), and.
 (c)if the functions are delegated to him and to other beneficiaries to be exercised by them separately (or either
separately or jointly), the power is revoked in so far as it relates to him..
(5)A delegation under subsection (1) may be for any period or indefinite..
(6)A power of attorney under subsection (1) cannot be an enduring power within the meaning of the M1Enduring Powers of
Attorney Act 1985..
(7)Beneficiaries to whom functions have been delegated under subsection (1) are, in relation to the exercise of the functions,
in the same position as trustees (with the same duties and liabilities); but such beneficiaries shall not be regarded as trustees
for any other purposes (including, in particular, the purposes of any enactment permitting the delegation of functions by
trustees or imposing requirements relating to the payment of capital money). =

 
Ê   
  

Note: Ñhile TOLATA 1996 aimed to give more power to the trustees, it had to find a middle
ground in ensuring that the interest of the beneficiaries was equally safeguarded.

+  #.  


7
./

A beneficiary to whom all or some powers have been delegated to by the trustee has a very
strong position but for aside from the beneficiary in this scenario, there exists the following 5
mechanism in place under TOLATA 1996:

(A)Overreaching
Is the land registered or unregistered land? Then follow the correct process as per the type of
land in question. See: Flegg & Boland.

(B)Consultation

ÊOL˜Ê˜ 1996, s.6(5) =



7"! F

45! "    #! !  .  *" 4 #
!. F

rote: compare the above and below sections: Ñhich one carries greater strength for the
beneficiaries?

ÊOL˜Ê˜ 1996, s.11¶Consultation with beneficiaries¶

)Ê    !* =
()$ ! 
 $
()"  ! $!# "  
$() * (! # ) =



()'() = 3 Cnd t ns:
)&
() #  
) ! 
  $ 
()!"  
$ ;)"  
 =


5$ 
()  "-()   +$ 
(;)'()   
 $ " 
   $#  
  =
()"   "   $  $
()"   "  $   " 
 #  =



Ê ›
Ê

(>)
 (;)#.   #  
(")
A purchaser need not be concerned to see that any requirement in s.11 had not been complied
with. Hence a beneficiary will only be able to make a personal claim against a trustee for
failing to consult. The trustees would simply just have to maintain that their actions were
warranted in line with the intentions of the trust or not practicable to consult.
ÊOL˜Ê˜ 1996, s.16 µProtection of purchasers¶
()
 "   *  
  -()$,(;)() " 
()Ñ =
()" # "  ( # )* 
#-(-)(8)$
()      #$
 ## # 
(;)Ñ  " #8=
()  +!     
 $
() # #    "  
 
(>)Ñ # "  ( # )* 
#     !
 =
()  !    !  
$
()  $  +! 
()
 "  (>) $ 
 $ *     "+
   "#    
! 
(-)'()(;)   $
(,)Ê  !

(C)Consent

ÊOL˜Ê˜ 1996, s.8(2)¶Exclusion and

estriction of Powers¶ =


  "  
45 ! +#!   "   
#
 " -,$ " "  .

ÊOL˜Ê˜ 1996, s.10(1) µConsents¶ =



 " * 
()5!  "    #
 ! $  "   
# 
()'()     $

(;)Ñ  "  !
    ! !=
() $# $  $
()   "    ("  
! / 
8)! 
 (D)Occupation =


 Ê ›
Ê

-"#<

ÊOL˜Ê˜ 1996, s.12(1) µÊhe right to occupy¶ =



7 ! 
()
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 ! $"   #
      =   !  BO›AND IÔ
()  +! # (  VER IMDORTANT IN THIÔ REGARD

"   !)$
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'%%  
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2 LJ Parker held unsuitability involves a consideration not only of the general nature
and physical characteristics of the particular property but also a consideration of the
personal characteristics, circumstances and requirements of that particular beneficiary.

ÊOL˜Ê˜ 1996, s.13 µExclusion and restriction of right to occupy¶ =



/ B,C
()Ñ "( ") # >
 $    ()
  =


%" #› 
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()  
(;)Ê    
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=
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THEÔE ARE CONDITIONÔ
(,)Ê "   = IMDOÔED ON THE BENE½ICIAR WHO HAÔ BEEN
GIVEN THE RIGHT TO OCCUD OVER ANOTHER
()# " ("   
BENE½ICIAR  (COMDENÔATION MEAÔUREÔ
)!  $ REA›› ) Ê "" 5 
()+   !  $ !$   "  #
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Daden [2007]$"  #
(8)Ê "    #!!"  !##
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2 Baroness Hale felt the both the old way of using the equitable principles of accounting
or the new way via s.13(6) would give the same results. Lord Neuberger µit would be
rare for equitable and statutory to produce different results.
 34 


 -.
#.  

Êhe courts power to intervene and protect beneficiaries had developed in the past under the
trust for sale. ^owever the jurisprudence on this area has now been placed on a statutory
footing through s.14 & s.15 ÊOL˜Ê˜ 1996.
Êhis section is built on the old s.30 of the LP˜ 1925.
ÊOL˜Ê˜ 1996, s.14 µ˜pplications for Order by Court¶
()
 "   * +
   =


Ê "
()    +  2 " +  +
()!     (!#!  =


Ê  $
 ! $$ "    !!
 )$ =


Ê "" 2
()! . *   + !"+!
 #!!+!
(;)Ê   +  # =


Ê " 
(>)Ê "   "   #" !" ! 
  
  5$›lds Ban v Rsset- "
 

Êhis section gives guidance to the court regarding its orders made through the powers given
to it under s.14. It is however no an exhaustive list as it states the points for consideration
µinclude¶ those listed in s.15(1)(a-d).Êhese have however been put in place as a result of the
case law decided under the old provision contained in s.30 LP˜ 1925. (CODIFIC˜ÊIOr?)
ÊOL˜Ê˜ 1996, s15-  Ñ+
O&77O
() Ê "    #!!
>2
() Ê  ( )"  $ =


/ "
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() Ê " " !    
#
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() Ê     =


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  ;$ "    #!
=



+!  
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!"+!  
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 * () * (! # 
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34


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"
A house was bought as a matrimonial home and the marriage broke down. The parties split
up and there were no children. 1
The CoA held under a s.30 LPA application that the
house should be sold. Ñith the ending of the marriage, the purpose of the trust also been
severed. The court made a point of emphasising the primacy of a trust of sale is that the
property should be sold.
 u -.
.  .
,/
7
.
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The courts will often have to decide in balancing the interests of a beneficiary over that of the
secured creditor.


))  
  
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34


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!$!%$
    $ "
The defendant (mother) had been persuaded to transfer her house into the joint names of her
and her daughter under the understanding that the property would not be sold during the
mother¶s lifetime. The daughter mortgaged the property to the Abbey National through
forging her mother¶s signature which was effective to mortgage the daughter¶s beneficial
interest. The daughter then failed to pay back the money owing on the mortgage. The Abbey
National then applied for a sale order under s.30 LPA. 1
The CoA refused the
application for an order to sale on the grounds that the collateral purpose of the trust still =


5/ Ê
3Ê%Ê 
  "
remained, ie, that the mother should continue to live in the property for the rest of her life.   $ 
 

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34
Ñhere a spouse who has a beneficial interest
in the matrimonial home has become bankrupt under debts which cannot be paid without the
realisation of that interest, the voice of the creditors will usually prevail over the voice of the
other spouse and a sale of property ordered within a short period of time. The voice of the
other spouse will only prevail in exceptional circumstances. In cases such as this, the
economic factors outweighed the social factors.

u .-/

7B.-
- .
1-

7 
 68<90"55=: (This is a new provision inserted by TOLATA 1996)
This provision only applies to cases Post-TOLATA. It deals with s.14 of TOLATA and lays
down particular criteria to take into account when dealing with a trustee in bankruptcy. A
trustee in bankruptcy will look for a sale to pay the debts owed and the beneficiaries will seek
to avoid a sale in order to remain the property.
()
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Justice Neuberger maintained that s.14 & s.15 had to some extent changed the law in this
area. He focused on the court being given greater flexibility when exercising its jurisdiction
under order of sales. 1
It is for the court to weigh up each factor based on the
circumstances of each individual case. The judge left it to the parties to try and agree terms
between themselves. He focused on the fact that should Mrs Shaire not agree to terms that
allowed the bank to be given a realistic chance of recovering some of its money, then he
would make an order for sale.

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The wife in this case had a very small beneficial interest and was one of the key
considerations when deciding the case. The wife was given a reprieve in the lower courts.
However, the CoA reversed the lower decision and ordered a sale.  
TOLATA has given
some scope for change but this was not as µradical¶ a change as that suggested by Mr Justice
Nueberger in Shaire [2001]. The judge at first instance had not taken into account the fact
that the mortgagee would take all the proceeds on the sale of the property considering the
amount that was owed to them. Nor did the judge acknowledge the subsequent injustice for
the bank resulting from indefinite refusal of sale.

   
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This was a wife trying to resist a sale and in doing so she tried to maintain that the house was
a matrimonial home (collateral purpose) and that even though the couple were no longer
living together she tried to make the assumption they would get back together. She also tried
to point out that there were issues with the children and grandchildren; however she had not
shown to the court the effect of the sale on these people. Furthermore, she argued the bank
had delayed in bringing this action.  
The sale was ordered on the basis that the bank
would continue to suffer financial detriment and the debt owed would continue to increase.
Regarding the banks supposed delay, the court found this to be irrelevant as during the delay
she was given use of the property for a longer period.




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Husband and wife as joint legal owners and beneficial owners. Hence the wife needed his "  ! !# ›

signature. The wife forged mortgage documents. She defaulted on the payments. The bank Ê  " +# Ñ $
then applied for an order for sale under s.14.  
An order for sale was granted but was  2""+ 
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postponed for a period of 4 months to allow the innocent co-owner to sell the property and  
purchase a new one. Ñhilst at the same time giving the bank relief for the debts owed to it.