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Overriding interests

The document outlines the principles of land ownership, emphasizing that ownership involves holding a bundle of rights rather than all rights, with the Crown as the ultimate owner. It distinguishes between legal and equitable rights, detailing the requirements for transferring land and the types of estates (freehold and leasehold) recognized under the Law of Property Act 1925. Additionally, it defines interests in land, differentiating between contractual and proprietary rights, and explains the implications of registration and the priority of rights in land transactions.

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Sera Hem
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20 views

Overriding interests

The document outlines the principles of land ownership, emphasizing that ownership involves holding a bundle of rights rather than all rights, with the Crown as the ultimate owner. It distinguishes between legal and equitable rights, detailing the requirements for transferring land and the types of estates (freehold and leasehold) recognized under the Law of Property Act 1925. Additionally, it defines interests in land, differentiating between contractual and proprietary rights, and explains the implications of registration and the priority of rights in land transactions.

Uploaded by

Sera Hem
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Week 1: Ownership and interest

Ownership of land

Land:
a)​ Isn’t moveable
b)​ Includes what’s above and below as well as on its surface, and
c)​ Includes what’s permanently fixed to it (eg if a TV can be taken away, doesn’t count
towards valuation of land)
d)​ Includes intangible rights in land (eg right to walk across a neighbour’s driveway)
e)​ Is physically and temporally divisible

Clarification on owning land: = holding major stake in bundle of rights over land, not holding all
the rights in the land
●​ Basic principle: all land owned by Crown

Special principle of land law: “land law rights” capable of attaching to the land itself → any
person who comes into ownership/possession of the land might be able to enjoy benefits that
come with it (eg easement → right to walk across neighbour’s land)
●​ Shows proprietary nature of rights + interests in land
○​ Provincial Bank v. Ainsworth [1965]: whether wife’s right to live in former
matrimonial home = proprietary right (she did not actually own a share of the
property)
■​ Right must be “ definable, identifiable by third parties, capable in its
nature of assumption by third parties, and have some degree of
permanence or stability”
●​ Different from ordinary contractual personal obligations

Definition owning land: person is a title holder; holds not land but an estate in it
●​ Means owning a period of time in it
●​ Gives (strong) right in rem: right to the property itself. Potentially/actually binds anyone
seeking to assert a right over the land. Is an outright ownership right = strongest.
○​ Contrast: right in personam = right to use/be present on land = right against
person who holds property
●​ Nemo dat: can’t grant u a bigger estate in the land than my own, but can grant a
smaller one

Types of estate (Law of Property Act (LPA) 1925, s 1(1))


1.​ Freehold estate (“fee simple absolute in possession”)
a.​ Biggest right possible
b.​ Perpetual title: no fixed expiration date
c.​ Legal or equitable
2.​ Leasehold estate (“term of years absolute”)
a.​ Has fixed expiration point
b.​ Owns freehold to land
c.​ Could grant someone else a leasehold estate
d.​ Legal or equitable

→ citizens aren’t free to devise their own types of property rights; range of permissible
estates/interests = controlled by P/courts

→ can only be 1 freehold estate, but numerous leasehold estates

Rules on registration/transferral

To obtain land, ask 2 qns:


●​ Who holds freehold?
●​ Are there any leaseholders?

To completely transfer (= registered disposition):

Method:
●​ Must be done by deed (LPA 1925 s 52)
●​ Then must be registered at Land Registry
●​ Note: Person who acquires estate = disponee

●​ Justification:
○​ 1) rights over land must be easily provable bc land = valuable form of property
■​ However: even in 1925 there are other (non land) property which =
valuable, which don’t need to be transferred by deed/registered. + short
leases can be valuable but are exempt from registration
○​ 2) land is immovable and so is vulnerable to all sorts of rights-claims
■​ Want to distinguish in personam from in rem

Exemption: short leases


●​ Leases less than 7 years = short lease.
○​ Valid legal estate, doesn’t have to be registered
●​ 3 years < Lease < 7 years
○​ Have to be created by deed
○​ Optional to register
●​ Leases less than 3 years
○​ Have to be in writing
○​ Don’t have to be created by deed
○​ Cannot be registered
Legal or equitable

Ask: who is the legal title-holder (freehold/leasehold/easement)? But you need the other side
of the picture: equitable rights attaching to land.

Legal right: binds everyone (S 1 LPA 1925)


●​ Who the law thinks owns the land
●​ Fixed number of rights that CAN be legal
○​ S1 LPA: (1) Estates: Freehold, Leasehold (2) interests: Easement, mortgage,
rentcharge, rights of entry
●​ Legal may = easement, right or privilege; rentcharge; mortgage; rights of entry
●​ Full formality req for creation of legal estates/interests (deed + registration)
●​ Registered interest = legal right in rem

Equitable right:
●​ Who else should own the land?
●​ More flexible, reflects reality of situation, easier to establish; but can bind third parties
only under certain conditions + can be lost through overreaching
○​ Eg informal co-ownership
●​ Less formality req for creation: eg written instrument (S 2 LPA 1989)
○​ In exceptional circumstances, courts will recognise the existence of an equitable
proprietary right arising from an oral agreement, provided that the conditions for
proprietary estoppel or implied trusts (resulting or constructive) have been fulfilled
●​ Eg: A has an interest in a piece of land owned by B. The interest can be, but hasn’t
been, registered. B transfers the land to C.
●​ “Priority rule” LRA 2002 s 29: doesn’t bind a disponee for value
○​ If C acquired land for value, not bound; will only be bound if legal right in rem
→ gets “special priority”/preferential treatment
○​ If C didn’t (inherited it/provided nominal consideration LRA 2002 s 132(1)),
likely bound → “basic priority rule” for A’s right since it was created first
■​ Note: what = “nominal consideration” depends on value of land
■​ Note: timing could be that C’s right came first in time (before A acquired
interest, B as OG owner left it in will to C)
●​ Not always that if C doesn’t provide value, A’s interest will win
out
■​ Note: some unregistered interests don’t require registration in order to
bind 3rd parties
●​ Override Land Register; = “overriding interests”

Note: legal/equitable distinction also found in other areas of law


●​ Eg personal rights; can someone enforce contracts against me?
○​ Eg can establish legal contract, but can establish an equitable defence of UI
○​ Equitable structures used all the time in business bc of flexibility, achieving
things that can’t be done through common law
○​ Can share ownership of property more easily through equity

Interests in land

Definition of interest: all types of claims/entitlements over land apart from ownership
rights/estates
●​ Caveat: leasehold estate shorter than 7 years = statutorily defined as an interest

Types of interest

Contractual (in personam)


●​ Eg: in a restaurant u have the right to be there and eat
●​ Eg: contractual licenses

Usually proprietary (in rem) → rights to property vs a person


●​ Eg rights in rem can be binding on 3rd parties dealing with the land
○​ Registration can turn 2-way agreement to right in rem against world
■​ Eg not building above a certain height, or right of first refusal

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