Introduction
Land law is a complex area of legal study, encompassing the rights, obligations, and interests associated with real property. This field is characterized by its detailed technical principles, including various proprietary rights, conveyancing procedures, and the interaction between registered and unregistered land. A comprehension of these principles is vital for any aspiring solicitor. It demands meticulous application of legislation and case law. This area of law concerns not only the legal framework governing land ownership, but also the practical implications of land transactions and disputes.
Estates and Interests in Land
Freehold and Leasehold Estates
The most fundamental distinction in land law is that between freehold and leasehold estates. A freehold estate grants the owner the right to possess and use the land indefinitely. A leasehold estate, conversely, grants the right to possess and use the land for a specified period.
Legal and Equitable Interests
Land can be subject to various legal and equitable interests. Legal interests, such as a legal lease or a legal mortgage, are created and transferred by deed. Equitable interests, such as a beneficial interest under a trust or an equitable easement, arise from the principles of fairness and are enforceable in equity.
Examples
- A legal lease of a shop for 10 years is a legal interest.
- A beneficial interest that arises when a couple jointly contribute to the purchase price is an equitable interest.
Registered and Unregistered Land
Registered Land
The Land Registration Act 2002 governs registered land in England and Wales. Under this system, title to land is registered at the Land Registry, creating a public record of ownership. The register records the legal owner and certain rights and interests affecting the land. Registration protects the purchasers as well as those with interests in the land.
Unregistered Land
Unregistered land is land where the title is not registered at the Land Registry. Ownership is proved by the title deeds. A complex system of legal and equitable rights apply to unregistered land and require diligent examination and investigation of the title deeds before a purchase takes place. It remains subject to unregistered interest, which may come into being without notice to a future purchaser.
Examples
- A person may have a registered title to a home. This information is kept at the Land Registry.
- An unregistered property’s history of ownership is traced through title deeds, with more documents and a more cumbersome process involved to prove ownership.
Co-ownership of Land
Joint Tenancy
In a joint tenancy, all owners possess the entire property equally. The hallmark of a joint tenancy is that of ‘survivorship’. If one joint tenant dies, their share passes automatically to the surviving joint tenants.
Tenancy in Common
In a tenancy in common, the co-owners own distinct, but undivided shares of the property. There is no survivorship in a tenancy in common and the tenant’s share passes to the beneficiaries of his will.
Severance
A joint tenancy can be severed to turn it into a tenancy in common. This can occur in various ways, such as by written notice, mutual agreement, or certain acts of a joint tenant that demonstrate an intent to treat their share separately.
Examples
- A couple jointly purchases a home to share equally, they are joint tenants.
- Siblings who inherit a property but wish to retain separate, inheritable shares are tenants in common.
Easements and Covenants
Easements
An easement is a right to use land belonging to another. Common examples of easements include rights of way, rights to light, and rights of drainage. These can be either legal or equitable depending on their methods of creation. A legal easement is created by deed and needs to be for the equivalent of a freehold or a leasehold. An equitable easement requires a written contract to have created, as per Law of Property Act 1925, s.53.
Covenants
Covenants are promises relating to land. Positive covenants require the covenantor to do something (e.g., maintain a fence), whereas negative covenants restrict the use of the land (e.g., preventing the building of a structure on a certain part of a property). Under common law, the benefit of a covenant will pass on to future owners of the benefited land, the burden may not pass to new owners of the burdened land. The benefit and burdens can however pass in certain equitable circumstances.
Examples
- A homeowner may have an easement granting a right of way over a neighbor’s land.
- A covenant may prevent building on certain land.
Landlord and Tenant
Lease Agreements
A lease is a contract that grants one party the right to occupy land owned by another for a specified period of time. The landlord retains the reversionary interest in the property during the lease term.
Lease Terms
Lease agreements typically contain a variety of terms relating to rent, repairs, the user of the property and forfeiture. A crucial aspect of a lease is the term or duration of the tenancy agreement, because the length of the term of the lease greatly impacts the way in which it is treated under statute.
Leasehold Covenants
Leasehold agreements will contain terms which detail the rights and responsibilities of the tenants in respect of the landlords, which run with the land. The passing of leasehold covenants is complex and depends on whether the lease was granted prior to 1996 or subsequent.
Examples
- A lease agreement may detail obligations about the time, place and method for rent payments.
- It may also include a covenant for quiet enjoyment, providing the tenant with the use and enjoyment of the land, free from unnecessary harassment by the landlord.
Mortgages and Charges
Legal Mortgages
A legal mortgage is a charge created by a deed that secures a loan against land. If a mortgagor fails to repay the loan, the lender can take possession of the property and sell it.
Mortgagee’s Powers
The mortgage gives the lender (mortgagee) a variety of powers, including to take possession of the land, power of sale and the ability to appoint a receiver of the rent.
Rights of a Mortgagor
The mortgagor, or borrower, has various rights, including the right to redeem the mortgage and to be notified of a sale. The right of redemption is a right which cannot be frustrated by a mortgage lender.
Examples
- A bank takes out a legal mortgage over a person’s home after issuing a loan.
- A mortgage lender has the right to repossess a property where the mortgage payments have not been kept up with.
Key Legislation and Case Law
Land Registration Act 2002
This is the primary legislation governing registered land in England and Wales. It aims to create a register of title that accurately reflects the ownership of land and the rights and interests affecting it. This legislation replaced the Land Registration Act 1925.
Law of Property Act 1925
This act governs many aspects of land law and continues to apply to both registered and unregistered land. This act sets out many rules relating to the way in which the land is transferred between owners, and the specific rules regarding legal and equitable interests in land.
Williams & Glyn’s Bank Ltd v Boland [1981] AC 487
This important House of Lords case affirmed the status of actual occupation as an overriding interest in registered land. It states that actual occupation is nothing more than “physical presence on the land” and there need be no apparent evidence that a person with an equitable interest has physical possession of the property to satisfy the requirement of actual occupation.
City of London Building Society v Flegg [1988] AC 54
This case sets out the importance of the principle of overreaching. Here a legal mortgage that was taken out by two legal owners of land overreached the equitable interest of the parents who had contributed towards the purchase price of the property. As the money was paid to the two owners of the legal title, the equitable interest did not bind the lender.
Stack v Dowden [2007] UKHL 17
This case establishes the important distinction in respect of how beneficial interests in co-owned land should be apportioned. For joint owners (joint tenants) who are not in a partnership relationship, and who contribute unequally to the purchase price of the property, it would be unfair to assume the beneficial shares in equity should be distributed equally.
Conclusion
The study of land law involves numerous complexities, requiring a careful balance between statute, case law, and factual analysis. Aspiring solicitors must therefore acquire a high degree of familiarity with the subject matter as well as its practical application. Through a strong understanding of estates and interests, the registration system, co-ownership principles, easements, covenants, landlord and tenant issues, and mortgages, they will be better prepared for the demands of this area of law. It is therefore apparent that understanding of the above principles will allow the students to be better equipped when approaching similar problems and also preparing for the SQE.
