Dear Samantha S.

Saturday, 5 May 2012

Land Law- Leases

LEASE AND LICENCE
A lease is an estate in the land which, therefore, gives a proprietary interest in the land.
A licence which only gives a personal right in the land.
Although the fact that licences only create personal interest, it has proved controverisal in the law today.

Keep in mind 2 vital consequences of the right being a lease and not licence:
1. It binds third parties. For example, purchaser of freehold.
2. The holder of a lease has security of tenure created by statute but a licence has not.

Landlord and Tenant: The parties to a lease are the landlord and the tenant. However, they are legally the lessor (landlord) and lessee (tenant)

THE ESSENTIAL CHARACTERISTIC OF A LEASE
Characteristics of a lease arise from the case, Street v Mountford,
X was given an exclusive possession of furnished rooms at a rent. She had signed a statement at the end of the agreement that this was not intended to give rise to a tenancy under the Rent Acts. It was held that she did have a tenancy.

It was held that: A lease must have 3 characteristics
1. exclusive possession
2. for a fixed or periodic term
3. at a rent
If so, there will be a tenancy, unless there are exceptional circumstances which make it a licence.
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The fact that the agreement is described as a licence does not prevent it from being a lease of the above characteristics are present. The only intention of the parties which relevent is the intention to grant exclusive possession.

In the case Antoniades v Villier,
It happened that a couple entered into separate but identical agreements under which they were given the right to occupy rooms and each had separate responsibility for payment of half the rent. The agreement provided that they were to use the rooms either in common with the owner or with other licensees permitted by him.
Despite the attempt to make this look like two separate licence agreecement, it was in fact a lease. A vital point here was that they had the choice of either 2 single beds or one double bed. They chose a double bed and so clearly they intended to occupy the rooms jointly.

In the meantime, in Aslan v Murphy,
A 'licence agreement' was held to be a lease. A key influence behind the decision was the nature of the accommodation. As a basement room 4ft3'' by 12ft6'', the ability of the licensor to introduce other to share with the occupant was clearly not operational.

Yet, contrast the two cases, Antoniades v Villier and Aslan v Murphy to the case AG Security v Vaughan,Where in AG Security,
A clause stating that a maximum of 3 other persons could be introduced to share the property with the licensee, was held to be real and reflect the reality of the arrangement. The court was influenced by the fact that:
1. Each occupant signed an agreement, which incorporated a clause that a maximum of 3 other people could be introduced to share house with them. This was realistic clause in relation to the shared occupation of four-bedroomed house.
2. This clause was actually exercised, indicating that it was not a mere pretence.
3. The occupants were strangers who arrived at the property willing, presumable, to share with other persons they did not know, unlike in Antoniades v Viller.

It is also worthwhile to consider whether the circumstances show that there was no intention to create the relationship of landlord and tenant. Heslop v Burns
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In Bruton v London,
A charitable trust held a licence from Lambeth Council to use a block of flats for the purpose of providing short term accommodation for the homeless. The trust then gave a licence to Mr Bruton, a homeless person to occupy a flat in return for weekly 'licence' fee. The HL felt that as Mr Bruton enjoyed exclusive possession for the term at a rent, in the absence of any exceptional circumstances, a lease had been created in his favour.

According to Lord Hoffmann, 'lease' and 'tenancy' are term used to describe a contractual relationship between parties who are landlord and tenant. Whilst, a lease will also often create a proprietary interest that is binding upon third parties, known as 'terms of years absolute', it was not as essential element of a contractual (non-proprietary) tenancy. To make it binding upon a third party, the original grantor would need to have an estate out of which to grant it.
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The rule that a lease must be form a term certain is illustrated by Prudential Assurance v London Residuary Body: lease granted until a road required for road widening invalid.
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Leases are classified by the length of time they last for:
1. Leases are for a fixed term
2. Periodic tenancies
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Tenancy at will: The tenant, with the owner's consent, occupies land at the will of the owner, who, therefore, may terminate it at any time. The tenant has no security of tenure and is really in no better position than a licensee except that as a tenant there is a right to exclusive possession.

Tenant at sufferance: The tenant, after the expiry of the lease, continues in possession without the consent of the landlord. A tenant at sufferance has no real tenancy and cannot even sue another for trespass.
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It is also vital to remember periodic tenancies: They arise from payment of rent at period intervals.
There are 2 types(Note that if they are not more than 3 yrs, could be legal):
1. Express periodic tenancies- where a tenancy is granted but the precise length of it is not declare.
2. Implied periodic tenancies.

EXAMPLE:
Jacey grants by written agreement to let flat to Casper. The agreement is signed by Casper but not by Jacey. However, Casper goes into possession and pays rent monthly.
This is not a legal lease as it is not by deed nor it us a valid equitable lease as it does not satisfy the requirements of s2 of LP(MP)A 19989.
Casper may claim a monthly periodic tenancy based on payment of rent.

Another example of a periodic tenancy is where there is no agreement at all and the 'tenant' is just allowed into possession and then pays rent at regular intervals. The payment of rent converts what is just a tenancy at will into a periodic tenancy.
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TYPES OF LEASES
1. Legal leases- A lease will be legal if created by deed, but there is an important exception:

s54(2) LPA 1925,

A lease not exceeding 3 years can be legal without any formalities (even oral) if:

i. in possession

ii. best rent- commercial rent

iii. no fine- no premium

2. Equitable leases- A lease can be equitable under the principle in Walsh v Lonsdale as an agreement for a lease but it must satisfy the three requirements fir a valid agreement set out in s2 LP(MP)A 1989.

In Walsh v Lonsdale,
A lease was granted by not by deed. Thus it was only equitable- an agreement for a lease can be enforced by equity on the bases of the maxim that 'equity looks on that as done which ought to be done.' Eg, if a person has agreed to grant a lease then he ought to do so and, as far as possible, equity will assume that he has done so. An agreement for a lease can create a valid equitable lease.

WHEN TRYING TO APPROACH TO LEASES QUESTIONS, TRY THIS:
LEASE----- Less than 3 yrs, it can be legal providing s54(2)LPA 1925
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More than 3 years, depend if they have deed.
If there is a deed--- then it is legal.
If there is no deed--- can be equitable providing s2 LP(MP)A1989
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If tenant pays the rent regularly, he can have a periodic tenancy, which is legal and is likely to be overriding if less then 7 years.
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COMPARISON BETWEEN LEGAL AND EQUITABLE LEASES

LEGAL LEASES:
1. Created by deed except for leases not exceeding for 3 years
2. Not granted at the discretion of courts
3. Tenant under legal leases can claim implied easements under s62(1) LPA 1925

EQUITABLE LEASES:
1. Created by agreement which stated by s54(2)LP(MP)A1989
2. Granted by the discretion of court- equitable remedies are discretionary
3. Tenant under an equitable lease cannot claim for an easements- equitable lease is not a conveyance.
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In addition, there are different rules on whether legal and equitable leases can bind third parties.
LEASES AND THIR PARTIES

Summary: Registered and Unregistered Land
REGISTERED LAND:
1. Legal leases for over 7 years are registrable dispositions.
2. Legal leases for less than 7 years are overriding interests.
3. Equitable leases should be rejected as estate contracts but, if they are not and if the leaseholder is in occupation, they may have an overriding interests under Sch3 Para 2 LRA 2002.

UNREGISTERED LAND:
1. Legal leases are binding on all third parties
2. Equitable leases need to be protected on the register of land charges as estate contracts: Class C(iv)

Tips:
i. What formalities are needed- vital length is not exceeding 3 years.
ii. If the lease is legal, does it need to subsequently registered? Vital length is not exceeding 7 years.
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PARTIES TO A LEASE

   Sale of freehold reversion
Lessor 1......................................................................................................... Lessor 2
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| Covenants Liability of successors?
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| Assignment of lease
Lessee 1...................................................................................................... Lessee 2
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   Sub-lessee

Definition:
Lessor- grantor of the lease
Lessee- grantee of the lease
Headlease- lease granted by the lessor to the lessee as distinct from a sub-lease.
Freehold reversion- the rights retained by the lessor on the grant of a lease.
Assignment- dispossition of the lessee's interest to the assignee who then takes over the assignor's interest in the land.
Underlease/ sub-lease- creation of a subsidiary estate out of the lessee's estate.

Tips:
When dealing with leases problem, we must ask 2 questions:
1. Is the lease legal or equitable?
2. What date was granted? If it was after 1/1/1996, the answer will be different from the one if it was before 1/1/1996 as Landlord and Tenant (Covenants) Act 1995 apples.
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ASSIGNMENT OF LEASES
S19(1) Landlord and Tenant Act 1927,
The landlord must not withhold consent unreasonably.

In the case International Drilling Fluids Ltd v Louisville
It was held that the landlord is entitled to be protected from having the premises used or occupied in an undesirable way by an undesirable asignee (or tenant), but consent to an assignment cannot be refused on grounds which have nothing to do with the relationship of landlord and tenant. So, personal dislike would not be enough.

s1(3) and (6) Landlord and Tenant Act 1988,
s1(3): If the tenant asks for consent in writing, the landlord must give or refuse consent in writing and must do this in a reasonable time.

s1(6): it is for the landlord to prove that:
i. a refusal of consent was reasonable
ii. consent was given or withheld in a reasonable time
iii. if conditions were imposed, that they were reasonable.

Examples of where a refusal of consent would be reasonable:
1. Where the landlord reasonable believes that a proposed assignment would lead to a breach of covenant in the lease.
2. The assignee tenant's references were unsatisfactory.
3. The financial standing of the assignee is unsatisfactory.

In Kened Ltd and Den Norske Bank plc v Connie Investments Ltd, Millett Lord Justice said that the essential question is: Has it been shown that no reasonable landlord would have withheld consent?
* Note that this point in relation to leases granted on or after 1.1.1996.

s19(1A), Landlord and Tenant Act 1927, (added by s22, Landlord and Tenant (Covenants) Act 1995)
Landlord and tenant of non-residential lease may agree in the lease what circumstances will justify the landlord in withholding consent.
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COVENANTS IN LEASES
Distinguish between:
i. Express covenants- actually contained in the lease
ii. Implied covenants- implied by law

Tips: Typical examples of covenants in an exam question are: repairing, payment of rent, that the tenant will only use the premises for certain purposes. (Normally express covenants)

Implied covenants are implied in the lease unless excluded- good ones to remember are:
1. Tenant's covenant to repair: If the premises are in disrepair at the start of the lease then if the tenant covenants to 'keep them in repair' this means that he must put them in repair at his expenses. Payne v Haine

2. Landlord's covenant for quiet enjoyment: For example that the tenant will not be disturbed by third-party rights and acts of the landlord which disturb possession, such as burst water pipes causing water to flow into the premises. If this covenants is broken, there could also be liability of s1(3) of Protection from Eviction Act 1977- unlawful harrassment.

Noise: Kekewich LJ in Jenkins v Jackson, who observed that this covenant does not mean 'undisturbed by noise'. Mention judgement in Southwark LBC v Mills, where the covenant was not broken by failure of the landlord to provide soundproofing in flats.

3. Landlord's covenants not to derogate from his grant: For example, not frustrate the purposes for which the premises were let such as interfere with a right to light. The covenant does not prevent the landlord setting up a competing business. Port v Griffith, (apply if the premises were to be let for a highly specialized purpose).

4. Tenant's covenant not to commit waste: Tenant must take proper care of the place. Denning LJ in Warren v Keen
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LIABILITY OF THE ORIGINAL LANDLORD AND TENANT ON THE COVENANTS
The original landlord and tenant are of course liable on the covenants while they are the actual landlord and tenant. When the freehold and the leasehold are assigned they may continue to be liable. This depends on whether the Landlord and Tenant (Covenants) Act 1995 applies. The Act applies to all leases granted on or after 1.1.1996 which by s1(1) are referred to as 'new tenancies'. Pre-1.1.1996 tenancies are referred to as 'other tenancies'

Note that by s28(1) a 'new tenancy' includes an agreement for a tenancy. For example, an equitable lease.

If the legal lease was granted before 1.1.1996, both landlord and tenant remain liable on the covenants for the whole term of the lease even if they are no longer parties. For example, the tenant has assigned the lease and the landlord has sold the freehold reversion. But note s.17 Landlord and Tenants (Covenants) Act 1995.

If the lease was granted on after 1.1.1996, then the Landlord and Tenant (Covenants) Act 1995 applies to legal and equitable leases.

s5 L and T(C)A1995,
The tenant on assigning the lease is released from his covenants and ceases to entitled to the benefit of the landlord covenants. However, the landlord may, as condition of agreeing to the assignment, require the tenant to enter into an authorized guarantee agreement (AGA) (s16) guaranteeing that the incoming tenant will perform the covenants.

EXAMPLE:
When the landlord gives consent to the assignment from T1 to T2, he can require T1 to enter an AGA under which T1 guarantees T2's liabilities under the lease. When T2 assigns to T3, the landlord may require T2 to enter into an AGA, but when the assignment is complete, T1's liability ends.

s6 L and T(C)A 1995
The landlord may, on spelling the freehold reversion, be released from liability on his covenants. The procedure is set out in s8.

Note: The date for deciding if the Landlord and Tenant (Covenants) Act 1995 applies is the date of assignment of the lease. It is not. It is the date when the lease was originally granted.
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LIABILITY OF THE ASSIGNEE LANDLORD AND TENANT ON THE COVENANTS
Once again, it is necessary to distinguish between pre-1.1.1996 and post-1.1.1996 leases:

Landlord 1............................................................................................ Landlord 2
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Tenant.................................................................................................. Tenant 2

PRE-1.1.1996
In this situation, the distinction between legal and equitable leases is important as covenants only run in legal leases.

Tenant 2 is liable on the covenants, provided that 2 tests are satisfied:
1. There is 'privity of estate' between the landlord and the tenant. This originally meant the parties holding the legal estate created by the original lease. For example, the original landlord and tenant. However, this principle has now been extended to assignee tenants (by common law) and assignee landlords (s.141 LPA 1925)

2. The covenants 'touch and concern the land' (Spencer's Case). For example, covenants to pay the rent, user covenants, but not a covenant giving the tenant the right to purchase the freehold nor personal covenants.

In Thomas v Hayward,
The landlord of a public house covenanted that he would not open another 'beer or spirit house' within half a mile of the premises. This did not bind an assignee tenant as it did not refer to anything to be done or not done on the premises.

Landlord 2 is liable for T2 under s142 PLA 1925 and can enforce covenants which 'have reference to the subject matter of the lease'. This term means fundamentally the same as the common law term 'touch and concern' and is also a useful guide in cases involving tenant's covenants.

POST-1.1.1996
The rules apply to both legal and equitable leases as we saw above.

s3 L and T(C)A 1995
'The benefit of all landlord and tenant covenants of a tenancy... shall in accordance with this section pass on an assignment of the whole or any part of the premises or of the reversion of them.'

Both incoming landlords and tenants are bound by covenants unless they are not landlord and tenant covenants. For example, they are 'personal in character'. This is very similar to the okd 'touch and concern test'.

Note that a question may involve breach by, for instance, a landlord of a covenant to repair and a refusal of the tenant in consequences to pay rent. Breach by one party does not excuse breach by the other and so the tenant is still liable to pay rent.

REMEMBER:
Make sure that the liability of sub-tenants on a covenant in a lease. Remember these three points:
1. There is no privity of estate between the landlord under the headlease and the subtenant. For example, the landlord is not a party to the sub-lease. This means that the landlord and the subtenant cannot directly enforce covenants against each other.

2. The landlord can, as an exception to the above rule, enforce a restrictive covenant which is negative by an injunction against subtenant.

3. The landlord can sue the tenant under the headlease for a breach for a breach of covenant committed by the subtenant and so claim to forfeit the lease.

EXAMPLE:
There are 2 covenants in a lease:
a. to repair the premises
b. not to use the premises for any purpose other than a high-class grocer's shop.

T has sub-let to St. L can enforce covenant (b) against St but can only enforce covenant (a) against T.
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REMEDIES FOR BREACH OF COVENANTS

TENANT'S REMEDIES:
1. Damages- for breach of covenant by the landlord to repair
2. Repudiation of the lease. Possibly linked to a claim for damages
3. Specific performance. Granted in respect of an obligation to employ a resident porter at a block of flats.
4. Appointment of a receiver. To make repairs.

LANDLORD'S REMEDIES:
A. FOR BREACH OF COVENANT TO PAY RENT:
1. Action for arrears for rent. Limited to 6 years' arrears. s.19 Limitation Act 1980.
2. Forfeiture proceedings. This is the remedy which an exam

Note: The remedy for distress was abolished by the Tribunals, Courts and Enforcement Act 2007. There is a replacement remedy for commercial leases.

B. FOR BREACHED OF ALL OTHER COVENANTS
1. Damages- For breach of the tenant's covenant to repair.
2. Injunction- To prevent breaches of covenants.
3. Forfeiture.

The main case to mention here is Expert Clothing Service and Sales v Hillgate House Ltd

FORFEITURE FOR NON-PAYMENT OF RENT

Does the lease contain a forfeiture clause allowing the landlord

a right of re-entry and forfeiture or the lease if any of the covenants are broken?

(The clause usually provides that the rent must be at least 21 days in arrear.)

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      NO       YES
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   Cannot forfeit the lease   Can forfeit the lease
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   Does the landlord need to make
   a normal demand for rent
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     Not if more than half
   a year's rent due.
   (In any case the lease
   generally provides that
   a formal demand for rent
   is not required.)
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   Has the landlord waived
   the right to forfeit
   (eg. accepts rent
   knowing of the breach
   of covenant?)
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   YES NO
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   Cannot forfeit the lease Can forfeit the lease
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   BUT
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   Tenant may claim relief from
   forfeiture by paying into
   court all arrears of rent
   and costs. if so, all proceedings
   are stayed and the tenant
   regains possession. Even if the
   tenant does not do this
   she may still claim relief
   within 6 months of
   execution of judgement.

FORFEITURE FOR OTHER BREACHES

Does the lease cpntain a forfeiture clause allowing the landlord

right of re-entry and forfeiture of the lease if any of the

covenants are broken?

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NO YES

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   Cannot forfeit the lease Can forfeit the lease
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   Has the landlord waived
   the right to forfeit?
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   YES NO
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   Cannot forfeit the lease Can forfeit the lease
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   Landlord must serve a notice:
   1. Specifies the breach
   2. Requires it to be remedied if it is capable of remedy
   3. Requires the tenant to pay compensations
   (s146(1)LAP1925)

Thursday, 3 May 2012

Land Law- Easement and Profit

To start off, we should always determine the definitions of legal terms.

Easement, is a right over one piece of land for the benefit of another piece of land. For example, a right to store, right to light etc.

Whilst, profits a prendre is that a right for a person to go onto the land of another, the servient land and take either part of the natural produce of the land, itself capable of ownership (such as crops, water) or animals.

DISTINGUISH EASEMENTS AND PROFIT

Similarities: Both easements and profits are proprietary interest in land.

Differences: Easement are rights over the land of another whilst profits are the rights to enter the land of another and take the profits of it.

CHARACTERISTICS OF EASEMENTS

There are four characteristics of an easements, which have been set out from the Re Ellenborough Park

(1) A Dominant Tenement (DT) and a Servient Tenement (ST): The easement must benefit land and there must be two pieces of land.

(2) Diversity of ownership: The DT and ST must be owned or occupied by different persons.

(3) Accommodates the DT: The easement must benefit the DT as such and not the present owner nor activities which the present owner is carrying on.

In the case Hill v Tupper,

The owner of a canal granted X the exclusive right to put pleasure boats on the canal for profit. However, it was held that the right was just a personal right which did not benefit the land as such.

The question arises from the case, whether a business carried on the land is so closely connected with the land that it does benefit it.

In the case Moody v Steggels,

The right to put an advertisement on a neighbor's land advertising a pub was held to be an easement. Although the exercise of right provided commercial advantage, the business benefitting (the pub) was seen as normal use of dominat land, having been present on the land over 200 years. With the business and land so entwined, a benefit to the former was also benefit to another.

After the comparison between two cases, notably that:

(a) whether a right accommodates the dominant tenement is a question of fact,

(b) to accommodate, the DT and ST must be sufficiently proximate to one another, Bailey v Stephens.

(4) Subject of grant: The right claimed must be capable of forming the subject matter of a grant. The basic point is that the right must be sufficiently certain. Bear in mind that:

(a) The rights of lights, water, air etc should be through define channels, Harris v De Pinna

(b) The rights that required cannot be too vague or uncertain, William Aldred's Case

EASEMENT SHOULD NOT INVOLVE THE OWNER OF ST IN POSITIVE AND NEGATIVE OBLIGATIONS

The ST should not be obliged to incur expenses so as to enable DT to enjoy the right, Regis v Redman. However in Crow v Wood, positive easements have been allowed by the spurious easement of fencing, where ST is required to fence his land for the purpose of enclosing livestock.

In Phipps v Pears, a claim was brought to an easement to protection of one house from rain and frost by another house. This would mean that the other house could not be demolished. The claim was rejected. The courts are reluctant to allow the creation of new negative easements which would be an undue restriction on an owner's rights over his hand.

In the meantime, an easement cannot subsequently be used for a different purpose, Jelbert v Davis.

EASEMENT CANNOT AMOUNT TO EXCLUSIVE USE-OUSTER PRINCIPLE

A distinction must be drawn between an easement and a lease or a licence.

In Copeland v Greenhalf,

The claimant owned land on which the defendant had stored and repaired vehicles for 50 years. He claimed an easement by prescription. This was a claim to beneficial use of the land and so could not be an easement. Judge Upjohn described it as: 'virtually claim to possession of the ST.'

Conversely, in deciding whether the ST has retained reasonable use of ST, consideration must be given as to what amounts to ST. In Wright v Macadam, where a tenant's revocable licence to store coal in a coal shed converted, upon the granting of a new lease, into a legal easements to store.

CAR PARKING

Whether there can be an easement of the right to park a car has not been definitively settled although there have been cases:

In the case Batchelor v Marlow,
The right to park cars on the ST during weekday working hours was rejected as an easement. Although the ST retained use of the land at night and on weekends, this was not considered reasonable use, especially since the ST related to business premises.

Contrast Batchelor,

In the House of Lords, in the Scottish decision of Moncrieff v Jamieson,
found in favour of finding easement to park. In doing so, Lord Scott criticised the 'reasonable use' test endorsed in the Court of Appeal (CA) decision of Bachelor v Marlow, preferring to ask whether the exercise of the right would leave the ST in 'possession and control' of the ST.

The question arises whether if there is an easement, then how does the Ouster Principle affect it? Suppose the X claims the right to park her car on a defined space on land that owned by Y. In Moncrieff, Lord Scott in HL proposed the test of whether the ST 'retain possessions and subject to the reasonable exercise of the right question, control of the ST.'

The Law Commission, in its consultation Paper, thought that it was difficult to define control and preferred to ask:' What can the DT do?' Thus, any right must be clearly defined.

EASEMENTS, PROFITS AND THIRD PARTIES
Quick summary:
Registered Land
(1) Legal easements and profits created expressly (by deed) are registerable disposition.
(2) Express legal easements and profits and equitable easements, which were overriding before 13.10.2003 remain overriding
(3) New equitable easements and profits are now minor interest
(4) The only new legal easements and profits that can be overriding are those created:
a. by impled version
b. by implied grant (Wheeldon v Burrows or s62 LPA 1925)

c. by prescription (Schedule 3 para 2)

Unregistered Land

(1) Legal easements are binding on all third parties.
(2) Equitable easements must be registered as land charges of created on or after 1.1.1926. Those created before will bind purchasers who have notice of them and will bind donees automatically.

CREATION OF EASEMENTS
(1)Expressly:
   a. Legal by deed
   b. Equitable by written agreement

(2) Implied reservation in a conveyance
   a. Necessity: such as land-locked Manjang v Drammah, Adealon v Merton
   b. Common intention: such as building a ventilation on the business premises in Wong v Beaumount Property Trust Ltd.

ACQUISITION OF IMPLIED EASEMENTS UNDER THE RULE IN WHEELDON V BURROWS

In Wheeldon v Burrows,
On a grant of land, the grantee (buyer) will acquire, by implication, all easements which:
(1) are continuous and apparent. Hansford v Jago
(2) common ownership and occupation of the potential DT and ST. Kent v Karang
(3) the right must be necessary for the reasonable enjoyment of the DT.

In Wright v Macadam,
The defendant let a flat to the claimant and gave her permission to store coal in it. He later grant her a new tenancy.
The legal principle was that the grant of the tenancy was a conveyance under s62(1) LPA 1925 and as a right to store coal was a right of capable of being granted by law the grant of new tenancy had effect of cenverting what was a licence into an easement.

PRESCRIPTION
Another way of acquiring an easement is by prescription, where it is the acquisition of easements and profits by long use.

The condition must be without Nec Vi, Nec Claim and Nec Precario, which means that the use must without force, secrecy and permission.

Three types of prescriptions:
(1) Common law- DT can claim that he has been exercising the easement since the 'time immemorial' of 1189.

(2) Prescription Act 1832-
Under the s2 PA 1832, where to an easement by prescription requires 20 years continuous use, but where the easement was exercised with the oral agreement of the ST, it is 40 years.

Under the s3 PA 1832, where to claim an easement of light requires of 20 year continuous use. No provision for 20 years where exercised with the permission of the owner.

A claim by prescription is based on a presumed grant and the claim will fail if the presumed grantor had no capacity to grant an easements.

(3) Loss modern grant: This is a way of letting the court assumes two things have not, in fact, occurred:
a. there was a grant of an easement
b. it has been lost.

EXAMPLE BASED ON PROFIT

Tehidy Minerals v Norman

Jacey allows her sheep to graze on Casper's land for many years but did not do so for the last 18 months because they were diseased.

a. no claim to a profit at common law- cannot prove since 1189

b. PA 1832 does not apply here since there was a discontinuous for more than a year (s4), no period of prescription as period not next before action.

c. arguable can rely on the lost common grant.

EASEMENT VS PROFIT
Note that the following rules on profits and how they are differ from those on easements.
(1) No requirement of a dominant tenement
(2) The rule Wheeldon v Burrows does not apply to the creation of profits but s62(1) LPA does.
(3) The periods of prescriptions are longer
(4) Apart from this, rules are generally the same.

LAW COMMISSION PROPOSAL FOR REFORM
In the Consultation Paper 186, the Law Commission provisionally proposed that:
(1) Any right must clearly defined, or be capable of clear definition and not involve the unrestricted use of the ST.
(2) Easement should no longer be capable of creation by implication under s62(1) LPA 1925. In addition, it asked whether the law on acquisition of easements by implication should be recast into statutory form.
(3) The present rules law on acquisition of easements by prescription should be abolished and replaced by one single method of acquisition by prescription with a proposed period of 20 years. The paper also asked if acquisition by prescription should be possible at all and if it could be replaced by proprietary estoppel, which the Commission does not favour.
(4) Profits should only be acquired by express grant, reservation or statute and not by prescription.
(5) Easements created by implication and easements in unregistered land should be capable of extinguishment after non-use after a set period of time. This would not apply to express easements in registered land.
(6) s84(1) of LRA 1925 should also allow the discharge or modification of easements or profits.

-4-

Wednesday, 2 May 2012

Land Law- Registered Land

There exist today two types of land: Registered and unregistered land. Each of them consist their own rules concerning the transfer of land from one person to another and the enforcement of third party proprietary interests affecting the land. We will firstly need to be familiar with Registered Land.

The Land Registration Act (LRA) 1925 (now the LRA 2002) provided a system of registration of titles but not titles to land. Therefore, there can be more than one title applicable on the same piece of land. The main aim of LRA 2002 is to make arrangements to the legislation to enable dispositions of registered land to be dealt with electronically.

The land registration scheme rests on 3 principles:

(1) Mirror Principle- All facts are relevant to the title are to be found on the register.

(2) Curtain Principle- Purchasers need not to look beyond the register and are not concerned with trust.

(3) Insurance Principle- Any flaw in the register leads to the payment of compensation to a person affected.

Scheme of the Land Registration Act

The LRA 2002 takes different types of estates and interests in land and classifies them for the purposes of land registration in the following ways:

(1) Dispositions which must be completed by registration.

(2) Unregistered dispositions which override registered dispositions. These correspond to the old category of overriding interest and the effect is that a buyer of the land can be bound by an interest that is not on the register.

(3) Interests which must be protected by an entry against the title which they bind. These were formally known as minor interests.

REGISTRABLE DISPOSITION

s27(1) LRA 2002 stated that:

If a disposition is required to be completed by registration, then it does not operate at law until it is registered in accordance with the requirements.

s27(2) LRA 2002 stated that:

The disposition which must be completed by registration:

(a) A transfer of registered freehold estate- This includes transfer by any of the following methods:

i. for valuable or other consideration

ii. by way of gift

iii. in pursuance of a court order

iv. transfer by personal representatives on death.

(b) The grant of a legal lease with more than 7 years to run. In addition, certain leases for less than 7 years are registerable, such as those which take effect more than three 3 after the date of the grant.

(c) Certain other leases and rights arising under leases. For example, registration of the grant of right to buy a lease under the Housing Act 1985.

(d) The express grant or reservation of legal easements, legal profit, legal rentcharges.

(e) A first legal mortgage created out of the estate. This will apply whenever existing legal mortgages are discharged and new mortgage created. This rule has proved to be one of the main means of transferring land from the unregistered system to the registered system.

The above-mentioned are the 'triggers' to registration of title. They cover almost all the possibilities but not quite: the appointment of new trustees and registration of the freehold on the grant of a long lease are not triggers.

This follows with the coming sections as:

s28 LRA 2002, where:

Basic rule- The priority of an interest affecting a registered estate or charge is not affected by the disposition of the estate or charge. The effect is that priority of the interests in registered land depends on their date of creation.

s29 LRA 2002, where:

The effect of a registered disposition made for a valuable consideration is that it takes priority over any rights affecting the estate prior to the disposition which are not protected by registration or are overriding. Thus, an interest which is neither overriding nor protected by any entry on the register will not be binding on the purchaser.

The relationship between ss.28 and 29 is demonstrated as below:

Jacey, the registered proprietor of Blackacre, has made a contract to sell it to Casper.

(a) Jacey dies and Tracey inherits the estate. Casper's contract binds Tracy as Casper's right was created first. (s28)

(b) Jacey sells the estate to Tracy. As the disposition was for valuable consideration, s29 applies and of Casper's contract was not protected by the registration, it will not bind Tracy.

The relationship between ss28 and 29 was considered in the case Halifax Plc v Curry Popeck, where the issue was the priority of two mortgages to different lenders over a property. The property had been transferred fraudulently and therefore no question of valuable consideration arose, so s28 applied. Thus the mortgage created first has the priority. The reason for the litigation was that the first lender had not acquired immediate charge over the property as there was no contract to satisfy s2 of the LP(MP)A 1989. However, the first lender did have a right by proprietary estoppel.

There are few dispositions of freehold land or leases with at least 7 years which will not be caught by the above rules and which will not need to be registered, such as an assignment of mortgage. Voluntary registration is also possible. For example, a freehold estate may be registered even though it is not being transferred.

OVERRIDING INTEREST

Overriding interest is an unregistered disposition which overrides a registered disposition. The LRA 2002 distinguishes between:

(1) The interests which override on first registration of the land and

(2) Interests which override on subsequent registration of the land.

The reason is because the effect of a first and subsequent registration is different.

COMPARING THE SCENARIO

SCENARIO 1:

Jacey sells 112 High Street, which has unregistered title to Casper. Follwing the sale, Casper registers the title. Jacey's Mom, Rita who contributed to the purchase price when Jacey bought the house, wtill lives there. Rita may have an equitable interest in the property. It is not at this time an overriding interest as 112 High Street has not beed registered. Time for deciding if Rita's interest is binding on Casper is when Casper acquired the title to it and the principles of unregistered land are relevant. However, when Casper's title is registered later, Rita's interest may then count as an overriding interest.

SCENARIO 2:

Now the title is registered. This time the crucial time is when Casper's title is registered. Now Rita's interest is counts as an overriding interest throughout the transaction.

SCENARIOS DIAGRAM:

(1)First registration

Completion of transaction------------------------------------------------------- Title then registered

Validity of interest decided

(2) Subsequent registration

Completion of transaction-----------------------------------------------------Title then registered

Validity of interest decided

INTERESTS WHICH OVERRIDES ON FIRST REGISTRATION:

(1) Legal leases not exceeding 7 years.

(2) Interests of persons in actual occupation.

(3) Legal easements and profits (not equitable).

(4) Miscellaneous such as local land charges.

INTERESTS WHICH OVERRIDES SUBSEQUENT REGISTRATION:

Leases:

(1) Legal leases with more than 7 years to run are registrable dispositions.

(2) Legal leases not exceeding seven years are overriding interests. (Shedule 3 para 1)

(3) Equitable leases should be protected by registration as minor interests. But if they are not and if the leaseholder is in actual occupation, then they may have an overriding interest such under Schedule 3 para 2, LRA 2002.

Note that s118(1) LRA 2002 gives the Lord Chancellor power to reduce the period for which registration of a legal lease is required. It is likely to be reduce to 3 years.

Overriding interests of occupiers- Schedule 3 para 2, LRA 2002

An interest belonging at the time of the disposition to a person in actual occupation except for:

(i) an interest of a person whom enquiry was made before the disposition and who failed to disclose the right when he could have been reasonable expected to do so;

(ii) an interest which belongs to a person whose occupation would not have been obvious on a reasonable inspection of the land at the time of the disposition and of which the person whom the disposition was made does not have actual knowledge.

In Williams & Glyn's Bank v Boland,

The wife had contributed to the purchase price of property and so had acquired the beneficial interest in it. The husband mortgaged it to the bank which sought possession when he did not keep up the repayments. As the wife was in occupation under an equitable interest, she had an overriding interest which bound the bank.

CASE DIAGRAM

Mortgage

Mr Boland------------------------------------------------------------------------------------- Bank

| Overriding interest binding on the bank?

Mrs Boland

When determining the question based on Williams & Glyn's Bank v Boland, the approach for a problem question:

1.Does the person claiming have a legal or equitable interest in the land?

2. Was he/she in actual occupation at the time of the disposition?

3. If so, does he/she has an overriding interest?

4. Is it binding on the purchaser?

5. Apply test (i) and (ii) in Sch3 para2.

To decide when does a right qualify as for overriding status:

National Provincial Bank v Ainsworth

When it is a proprietary interest in land, whether legal or equitable. The principle is given statutory force by s29(1) LRA 2002 which refers to any interest 'affecting the land', such as proprietary interest.

EASEMENTS AND PROFITS

Legal easements and profits created expressly after 13.10.2003 (by deed) are registrable disposition.

Equitable easements and profits created on or after 13.10.2003 can only take effect as minor interest.

The new legal easements and profits that can be overriding are:

(1) created by implied reservation

(2) created by implied grant (Wheeldon v Burrows rule or s62(1) LPA 1925)

(3) created by prescription (Sch 3 para 3 LRA 2002)

Where an easement can be overriding, it will then be the same way as for rights of occupiers. But remember:

Where the person entitled to the easement or profit proves that it has been exercised in year previous to the disposition then it will in effect always be overriding.

EXAMPLE SCENARIO:

Jacey has a right of way (easement) over Casper's land. Casper sells the land to Johnny.

(1) If the easement was granted by deed, it will not bind Johnny unless registered.

(2) If the easement was granted by agreement but not in a deed, it is equitable and will not bind Johnny unless protected on the register as a minor interest.

(3) If the easement was created by implied grant or prescription, it can be overriding but will not bind Johnny where cases (i) or (ii) in Schedule 3 para 2 apply. However, it will bind Johnny if Jacey exercised it in the year previous to the disposition (sale to Johnny).

PROTECTED REGISTERED INTERESTS: MINOR INTERESTS

Protected registered interests is the interests in land which are not overriding and include: restrictive covenants, equitable easements and profits, estate contracts and rights of beneficiaries under a trust.

Most of these must be protected by an entry on the register to bind a purchaser. One significant change from pre-LRA 2002 law was that where an overriding interests in protected on the register by notice, it ceases to be an overriding interest even if the notice is later removed from the register. There are two ways of protecting the interest:

(1) By a notice

(2) By restriction

ALTERATION OF THE REGISTER

INDEMNITIES

If the register needs to be altered, compensation can be paid to whoever has suffered the loss subject to s103 and Sch 8 LRA 2002.

-3-

Land law- The Interest In Land

What is Interest in land? The proper definition is that a right which a person has over another's land. There are 2 types of interest:

1. Legal interests

2. Equitable interests

These two interests are different from each other but both of them share a common feature- they are proprietary rights in land, which means that they are capable of binding third parties. It is different from the personal rights, which is not capable of binding third parties (eg, licences)

1. LEGAL INTEREST IN LAND

The list of interest which can be legal is:

(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. This includes both easements (the right to use the land of another in some way or prevent it from being used for certain purposes, such as rights of way and rights of water and light) and profits a prendre (rights to take something from the land of another, such as fish, wood or grazing rights).

In order to be a legal, the right must be held either for an indefinite time (equivalent to a fee simple) or for a definite time (equivalent to a term of years). Therefore, an easement for life or a right of drainage granted until the road is adopted by the local authority cannot be a legal interest, must be equitable.

(b) A rentcharge in possession issuing out of or changed on land being either perpetual or for a term of years. Rentcharge is that someone gives the owner the right to a periodical sum of money secured on land independently of any lease or mortgage. For example, where the seller of land reserves an annual payment for it to secured by a rentcharge. These are commonly found in the Manchester and Bristol area.

Yet, there will be no new rentcharge can be created after 22 July 1977 and most rentcharges will be extinguished on 22 July 2037 or 60 years from the date of the creation.

(d) Land tax, tithe rentcharge, and any other similar charge on land which is not created by an instrument.

(e) Rights of entry exercisable over or in respect of a legal term of years absolute annexed, for any purpose, to a legal rentcharge. A right of re-entry in a lease, if the tenant, for example, fails to pay the rent, is made an interest in land itself. It can be attached to a legal rentcharge to secure payments of the rent.

Assuming that the interest is within this list, then in order to be legal it must have been created by DEED, s52(1) LPA 1925. Whilst, s1(2) and (3) Law of Property (Miscellaneous Provisions) Act 1989 stated that:

An instrument shall not be a deed unless:

(i) it makes clear that it is intended to be a deed

(ii) it is signed by the person executing it and by a witness present at the same time who also signs it

(iii) it is delivered by the person executing it or by someone on his behalf.

COMPARING THE SCENARIO:

SCENARIO 1

Jacey agrees Casper by a deed that Casper can have a right of way across X's land for the rest of Casper's life.

To identify:

Step 1- Identify the right: an easement

Step 2- Legal or equitable?

As it is for life, it can only be equitable even if it is signed in a deed.

***

SCENARIO 2

Jacey agrees with Casper that Casper can have a right of way across Jacey's land.

To identify:

Step 1- Identify the right: an easement

Step 2- Legal or equitable: It does not mentioned that the easement is for the rest of Casper's life, therefore we can assume that it is for ever. So, it can be either legal or equitable.

Step 3- Is it in a deed? If yes, then it is a legal interest.

* Note that sometimes the interest is not actually granted by deed but it is implied to it.

2. EQUITABLE INTERESTS IN LAND

The term equitable means that the right was originally only recognised by the Court of Chancery, which dealt with equitable rights and not by the Courts of Common Law.

Equity often applied where the application of the strict rules of common law would not have produced a just result. The effect was that equity often did not insist on the observance of formalities, such as the need for a right to be granted in a deed.

In order to decide if the right is equitable, you should ask:

(i) is it above the list of legal interest? If not, then it must be equitable

(ii) if it is in the above list, then was it created by deed? If not, then it must be equitable.

INTEREST UNDER TRUST

Trust, arises when property is held by one person (known as trustee) on trust for another ( known as beneficiary).

X (trustee) ---------------------------------------------------------> Y (beneficiary)

Many trusts met in land scenarios are not created by the parties specifically agreeing to set up a trust but in other ways. For example, by one party (Y) paying part of the purchase price of property which is actually held in X's name. Here, equity implies a trust in favour of Y.

The legal ownership and the benefit are split and the common law, apparently because it could not cope with the idea of splitting these two, refused to recognise trusts and allowed the trustee to ignore the rights of beneficiaries.

However, equity enforce trusts because this was a matter of conscience. Common example is that a trust is where a person (X) contributes to the purchase of land but the legal title is held in the name of Y. Y then will hold the trust of X in the absence of contrary intention.

INTERESTS NOT CREATED FORMALLY

If a contract has been made to create an interest in land then equity may, at its discretion, enforce it by decree of specific performance (court order which commands the performance of a contract) or restrain its breach by an injunction (court order which either orders a lawful act to be done or restrains an unlawful act). This is in accordance with the equitable maxim that 'equity looks on that as done which ought to be done'. This means that when a deed is required to create an estate or interest in land and there is no deed, equity may still regard the interest subsisting in land as an equitable interest.

For example, Jacey agrees to grant Casper a right of way over his land. This is not a deed. As in the above-mentioned example, it can be assume that it is to last for ever, as it does not say that it is for life. However, that lack of a deed would still be fatal to it being a legal easement. However, equity may come to rescue and declare it to be an equitable easement.

Yet, how to tell if there is a deed or just an agreement?

(i) The word 'grants' usually indicates a deed as this is the idea behind one: the right of way is granted by Jacey to Casper and not agreed by them.

(ii) The words 'agrees to grant' indicates just an agreement as it points to the future and this fits with the idea behind equity: it enforces a contract to grant an interest in the future.

Bear in mind that, referring to s2 Law of Property (Miscellaneous Provisions) Act 1989,

Contracts for the sale or other disposition of an interest in land made on or after 27 Sep 1989 must:

(i) be in writing

(ii) contain all the terms agreed my parties

(iii) be signed by all the parties.

Therefore, equity will enforce a contract for an equitable easement provided that it satisfies these requirements. Contracts made before that date do not require writing and there are several fairly cases in which this point has been important.

RESTRICTIVE COVENANTS

Restrictive covenants is, where a person covenants in a deed not to use his land in a certain way or to do something on his land, such as keep fences in repair or not build on the land.

These have only ever been enforced in equity.

DISTINCTION BETWEEN LEGAL AND EQUITABLE INTEREST

We often ask ourselves, why do we need to know or able to distinguish the difference between legal and equitable interest. The reason is that the differences between the interest will cause different effect which they have on the purchaser of the land. Note that if a person is not the purchaser, then that person takes the land with all equitable rights, such as inherited the land.

OVERREACHING

Overreaching is the process by which equitable rights which exist under a trust of a land are removed from the land and transferred to the money (the capital money) which has been paid to purchase the land. The effect is to give the purchaser automatic priority over equitable interest under a trust.

Under s.2(1) LPA 1925,

'A conveyance to a purchaser of a legal estate in land shall overreach any equitable interest or power affecting the estate, whether he has notice thereof. There are various instances where overreaching can take place but the relevant one here is,

s2(1)(ii): where the provision of s27 of the LPA regarding the payment of capital money are complied with, ie. the capital money is paid to at least two trustees or a trust corporation.

*Note that this vital restriction on overreaching: It can only take place if the transaction is made by at least 2 trustees or a trust corporation.

COMPARING THE SCENARIO

SCENARIO 1

sells the legal estate to

X---------------------------------------------------------------------------------------------------------------Y

SCENARIO 2

X and W -----------------------------------------------------------------------------------------------------Y

|
|
|
|
|
Z beneficiary under a trust

Here, Y will not bound by Z's interest as the transaction was entered into by two trustees (X and W) and so Z's interest in the property is overreached and is transferred to the proceeds of sale. The effect is that Y need not concern himself about them but Z may claim against X and W for any share of the proceeds of sale which she feels belongs to her.

In City of London Building Society v Flegg,
where Mr and Mrs MB were the registered proprietors of a house but over half of the purchase price had been raised by Mr and Mrs F (Mrs MB's parents), who were also lived in the house. Accordingly, the house was held on trust for all four of them. Mr and Mrs MB then, without the acknowledge of Mr and Mrs F, raised two further charges over the property and then defaulted on the repayments. The lender sought possession and it was held that the interests of the parents had been overreached by the charges and their rights now only existed in the proceeds of sale.
The legal principle: The interests of beneficiaries in a trust of land are overreached if the transaction os entered into by two or more trustees.

The extent of overreaching has been extended in the following case, where:

In State Bank of India v Sood,
it was held that overreaching applies not only where capital money is actually paid but also where the mortgage was created as security for existing and future liabilities.

-2-

The Law of Property

Dear Samantha,

Let me introduce and explain the "fun" subject with you-- Land Law.

WHAT IS LAND?

First of all, what is land? We normally think that land is kind of a piece of soil. While the legal definition of land is, according to s.205(1)(ix) of Law of Property Act 1925"

Land includes land of any tenure, and mines and minerals, whether or not held apart from the surface.

What is unsettled is how far does the definition extends:

In Bernstein v Skyviews and General LTD, the case was claimed by the landowner for trespass in respect of flights over his house for aerial photography rejected. The court held that a landowner only owns such airspace necessary for the reasonable enjoyment of the land.

Note that, when a land is sold, in order to avoid disputes, sellers usually provide lists of what are fixture and fittings. Botham v TSB Bank Plc

The Treasure Act 1996 abolished the old notion of 'treasure trove' and provides that articles defined as treasure vest in Crown.

ESTATE IN LAND

All land is owned by the Crown. The most that anyone can have is an estate in the land.

Estate in the land:

The rights which person has to control and use the land. An estate owner is often called the owner of the land. Estate in land must be created by deed except in the case of leases for up to 3 years, s.54(2)LPA 1925.

s.1(1) LPA 1925 stated that:

The only estates in land which are capable of subsisting or being created or conveyed at law are:

1. An estate in fee simple absolute in possession (legal freehold estate)

2. A term of years absolute (legal leasehold estate)

Freehold Estate:

All land must have a freehold owner. If the individual owner cannot be traced, the ownership will be held by the Crown.

Leasehold Estate:

Land may also be held under a leasehold estate and so there will be 2 estates in the same land.

-1-

Tuesday, 1 May 2012

又是这时候

亲爱的萨蔓妲，

算了，不想再说不好意思。

每次冷落你，不知到自己已经说了多少不好意思。

老娘忙着当律师，你好心就将就一下。

没错，又到了发牢骚的时候！

昨天英国时间 14.00-16.00，

老娘我正式上完大学第二年的最后一趟课。

下个星期二开始考试。

忙着复习之余，还忙着收集大家的‘好运’。

要求不多，老师你只要给我一个及格，老娘便是感激不仅。。

眼看五月八号就在眼前。

有种死刑来临的感觉：无助，彷徨，焦虑。

不知道自己已经多久没有到城市去。

不想浪费时间，一份一秒

不想浪费钱，一分一豪。。

因为我这个人有个乖僻，

压力起来就会失心疯。。

会乱买东西，乱买食物。。

好啦，

牢骚发够了，

胡言乱语完了。

＊咻＊

回去念书了！

－－－

幸福上

J.C.