Land Law in England and Wales: Core Principles and Cases

Introduction

Land law in England and Wales sets the rules for owning, using, and transferring land. It blends long-standing common law with modern statutes such as the Law of Property Act 1925 (LPA 1925) and the Land Registration Act 2002 (LRA 2002). This guide explains the main building blocks: estates (freehold and leasehold), legal and equitable interests, registration and priority, and the headline topics of easements, covenants, and mortgages. You’ll also find short case notes and practical steps for day-to-day use in conveyancing and property disputes.

What You'll Learn

• What “land” covers and the two legal estates recognised by the LPA 1925
• How to tell a lease from a licence using Street v Mountford
• The difference between legal and equitable interests, and how each is created
• How registration works under the LRA 2002 and why some interests override
• How unregistered land is protected via the Land Charges Act 1972
• Essentials of easements, restrictive covenants, and mortgages
• Key cases including Tulk v Moxhay, Williams & Glyn’s Bank v Boland, and Stock v Barrs
• Practical checks to spot occupiers’ rights, overreaching, and priority traps

Core Concepts

The Nature of Land and Estates

• What counts as “land”

  • Land includes the ground, buildings, and fixtures attached to it. Items fixed to land generally become part of the land (fixtures), whereas moveable items remain personal property (chattels).

• Two legal estates (LPA 1925, s.1)

  • Fee simple absolute in possession (freehold): open-ended ownership.
  • Term of years absolute (leasehold): time-limited right to exclusive possession.

• Lease vs licence

  • A lease grants exclusive possession for a term, usually at rent. Labels do not decide the issue—substance does.
  • Street v Mountford [1985] AC 809 confirms that exclusive possession for a term at rent creates a lease even if the agreement is styled a licence. A licence is a personal permission to occupy, not a proprietary right.

Legal vs Equitable Interests

• Creating legal interests

  • Legal estates and interests are created by deed (LPA 1925, s.52), which must be signed, witnessed, and delivered. Common legal interests include mortgages (legal charges), easements, rentcharges, and rights of entry (see LPA 1925, s.1(2)).

• Equitable interests

  • Arise where formalities for a legal interest are not met, or through trusts, contracts, or proprietary estoppel.
  • Beneficial interests under a trust divide legal title (held by trustees) from beneficial ownership (held by beneficiaries). Trustees exercise powers under the Trusts of Land and Appointment of Trustees Act 1996 (TLATA 1996).

• Enforceability and priority

  • Legal rights generally bind the world.
  • Equitable rights are more sensitive to notice and registration rules. In registered land, they may be protected by entries on the register or fall within the category of overriding interests. In unregistered land, many must be registered as land charges to bind buyers.

• Overreaching

  • If purchase money is paid to at least two trustees or a trust corporation, equitable interests behind a trust of land are transferred from the land to the sale proceeds (LPA 1925, ss.2, 27). This allows buyers to take free of many beneficial interests if they comply with the payment rule.

Registered and Unregistered Land: Priority and Protection

• Registered land (LRA 2002)

  • HM Land Registry keeps the Property, Proprietorship, and Charges registers. Title is state-guaranteed, and most transactions trigger compulsory registration.
  • Priority is governed by the register and the LRA 2002. Notices and restrictions protect many third-party rights.
  • Overriding interests (Schedule 3) can bind a buyer even if not on the register. Key examples:
    • Short leases (not exceeding 7 years) in many cases.
    • Interests of persons in actual occupation (para 2).
    • Some legal easements (para 3).
  • Actual occupation is a factual test; it requires a real physical presence or activity consistent with the nature of the property.

• Unregistered land

  • Ownership is proved through title deeds, usually showing at least 15 years’ “root of title”.
  • Many equitable rights must be registered as land charges under the Land Charges Act 1972. If a registrable land charge is not registered, it is usually void against a purchaser for value of a legal estate. Legal interests and certain overriding interests bind without registration.
  • Searches of the Land Charges Registry are essential when dealing with unregistered title.

Easements, Covenants, and Mortgages

• Easements

  • Rights enjoyed by one parcel of land (dominant tenement) over another (servient tenement), such as a right of way or right to light.
  • Creation: typically by deed (express grant or reservation), by implication on sale, or by long use (prescription).
  • Prescription requires use “as of right” for the required period: without force, without secrecy, and without permission (Dalton v Angus [1881] 6 App Cas 740).

• Covenants

  • Promises linked to land. Positive covenants require action (often payment). Restrictive covenants limit use (for example, “residential only”).
  • The burden of a positive covenant does not usually bind freehold successors. The burden of a restrictive covenant can bind successors in equity if requirements are met (intention that it should run, it “touches and concerns” the land, and the original covenantee owned benefited land).
  • Tulk v Moxhay [1848] 2 Ph 774 shows that restrictive covenants can bind later owners who take with notice (today typically via a registered notice in registered land).

• Mortgages

  • Most commonly created as a legal charge by deed over registered land. The lender (mortgagee) takes rights to protect repayment.
  • Statutory power of sale arises under LPA 1925, s.101, and can be exercised when conditions in s.103 are met (subject to any contractual terms). The lender owes a duty to act in good faith and take reasonable care to obtain a proper price on sale.
  • Borrowers may seek relief, but persistent default can lead to possession and sale.

Key Examples or Case Studies

• Street v Mountford [1985] AC 809

  • Issue: Whether an “agreement” was a lease or a licence.
  • Key point: Exclusive possession for a term at rent creates a lease, regardless of labels.
  • Use it for: Assessing occupation agreements and spotting shams dressed up as licences.

• Tulk v Moxhay [1848] 2 Ph 774

  • Issue: Whether a restrictive promise bound later buyers.
  • Key point: Restrictive covenants can bind successors in equity if they take with notice and the covenant benefits land.
  • Use it for: Enforcing “use” restrictions across a freehold estate.

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

  • Issue: Whether a wife’s unregistered beneficial interest could bind a lender.
  • Key point: Actual occupation can protect a beneficial interest as an overriding interest in registered land.
  • Use it for: Lender and buyer checks—ask who lives at the property and on what basis.

• Dalton v Angus [1881] 6 App Cas 740

  • Issue: Requirements for prescriptive acquisition.
  • Key point: Use must be without force, secrecy, or permission for the required period.
  • Use it for: Right of way and right to light disputes based on long use.

• Stock v Barrs [2020] EWCA Civ 1539

  • Issue: Whether a lodger had an overriding interest via actual occupation.
  • Key point: A lodger’s status did not amount to a proprietary right capable of protection as an overriding interest.
  • Use it for: Distinguishing occupiers with genuine proprietary claims from bare licensees.

• Stack v Dowden [2007] UKHL 17

  • Issue: Shares in the home where legal title was joint but contributions differed.
  • Key point: Courts may recognise unequal beneficial shares where evidence shows that was intended.
  • Use it for: Co-ownership disputes and advising co-buyers to record their shares.

Practical Applications

• For every purchase of registered land

  • Obtain official copies of the title and plan. Check the Charges Register for mortgages, restrictions, and notices of third-party rights.
  • Ask pre-contract questions about occupiers. Confirm who lives there and their basis of occupation. Inspect the property to identify signs of actual occupation.
  • Consider overreaching: ensure purchase money is paid to two trustees or a trust corporation if there is a trust of land.

• For unregistered land

  • Review the title deeds to establish a good root of title. Conduct Land Charges Registry searches against the correct names and variations.
  • If a registrable equitable right is not registered as a land charge, advise on its likely loss of priority against a purchaser for value.

• Easements

  • Check for express grants in deeds and entries on the register. Look for long use suggesting prescription.
  • If a right is claimed by prescription, assess whether use has been without force, secrecy, or permission for the required period.

• Covenants

  • Identify any restrictive covenants on the register (or in deeds for unregistered land). Consider enforceability and possible discharge or modification.
  • For positive obligations needed on a freehold estate (e.g., estate charge), plan suitable mechanisms such as chains of indemnity covenants or rentcharges.

• Mortgages

  • For lenders: ensure proper creation and registration of the charge. Before enforcing, check contractual terms and statutory conditions (LPA 1925, ss.101–103).
  • For borrowers: explore redemption, re-financing, and any available relief. If sale proceeds are at risk, remind the lender of the duty to take reasonable care over price.

• Lease or licence?

  • Where occupation agreements are in issue, test for exclusive possession. If present with a term and rent, it is likely a lease despite any “licence” label.

Summary Checklist

• Know the two legal estates: freehold and leasehold (LPA 1925, s.1)
• Use Street v Mountford to separate leases from licences (exclusive possession is key)
• Create legal rights by deed (LPA 1925, s.52); otherwise, they may be equitable only
• In registered land, protect rights by entry on the register unless they are overriding
• Overriding interests include some short leases, actual occupation, and certain legal easements (LRA 2002, Sch 3)
• In unregistered land, register equitable rights as land charges or risk loss of priority
• Overreach beneficial interests by paying capital money to two trustees or a trust corporation (LPA 1925, ss.2, 27)
• For easements, check deed, implication, or prescription (use without force, secrecy, or permission)
• For covenants, restrictives may bind successors (Tulk v Moxhay); positives usually do not
• For mortgages, note the power of sale (LPA 1925, ss.101–103) and the lender’s duty on sale

Quick Reference