Question 5. Page 32. Law of Property

Anne has entered into a contract to buy Greenacre from Paul. He has now sold Greenacre to Clare. Anne is saying that Claire must now sell Greenacre to her. What is the correct statement of Anne’s position?

a. Anne has an estate contract, this is an equitable interest and if Claire is a bona fide purchase shhe takes free of the interest regardless of notice?

b. Anne should have entered the estate contract as a class iv Land Charges. section 2 LCA 72 . If she has then Claire is bound by that interest. If she has not then Claire takes free regardless of her notice or her bona fides.

c. Anne has a contract with Paul and has a personal claim against him in breach of contract.

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a. She had an estate conttract then this is not binfing on Claire who is a third party. The bona fide purchaser of legal estate without notice is equity’s dalring in which case Claire’s position is inassailable.Moreover, if this is regstered land notice would have no effect.

b. This is correct in that Anne shold have entered it. But even if it was entered this would have no effect. This is like Midland Bnk v Green

c. She does have a personal claim. She has no claim against Claire.

b.

Question 4. Page 32. Law of property

Anne has a trust in Blueacre. Legal title is held by her parents, Daniel and Dorothy. Paul has purchased Blueacre from Daniel and Dorothy and after, paying the purchase monies to them both, wants Anne to move out. What is the correct statement of Anne’s position?

a. Her interest has been overreached so she has no right to stay.

b. Paul is bound by her interest if he has actual, imputed or constructive notice of Anne’s interest in Blueacre.

c. Anne should have protected her interest by entry by her interest on the Land Charges Register against the names of Daniel and Dorothy.

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a. May be correct. She has an equitable interest and not a legal interest. Paul has legal ownership and legal rights bind the world. His rights will defeat hers. The parents held the property on trust for their daughter. They were the two trustees. Money was paid to them and as it is at least two trustsees this will probably operate as overreaching. Anne probably has a constructive trust and not a resulting trust as she probably did not contribute to te purcahse price. Her rights will be turned into a shar eof te money.

b. Notice is neither here nor there. This is registered land.

c. Anne should have done this. Anne would still have to move out but she would definitely get some compensation and its amunt might be larger.

Question 3. Page 31. Law of property.

Anne bought Whiteacre from Paul. Her neighbour Nina claims that Anne cannot use Whiteacre as a business as Nina entered into a restrictive covenant with Paul. How should Nina have protected her interest?

a. She must enter the restrictive covenant onto the Land Register against Whiteacre.

b. She cannot protect it against a bona fide purchaser.

c. She should enter the interest against Paul’s name on the Land Charges Register.

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c is the correct answer. Land Charges under the LCA 1972 are registered against the name of the owener of the affected property and not against the land. This is a controoversial and possibly foolsh system but that is the way it is. A registered land charge is binding on a bona fide buyer.

Question 2. Page 31. Law of property.

Anne has a trust interest in Greenacre, the legal title is held by her partner Dell. Paul has purchased Greenacre froom Dell and wants Anne to move out. Which is the correct statement of Anne’s position.

a.    Anne’s beneficial interest will be binding on Paul if Anne has entered her interest in Greenacre on the Land Charges Register under section 2 Land Charges Act 1972?

bb.      Anne’s beneficial interest is automatically lost on transfer as her interest has been overreached when purcahse money was paid to Dell.

.c.      Paul will only be bound if he had actual, imputed or constructive notice of Anne’s interest in Greenacre.

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a. Anne has an equitable interest and it is overreachable. However, it is possible to register it. So she miight have registered it. But Paul has legal title. Legal rights bind the world but in this case her equitable interest will survive if she has registered it.

b. This is not necessarily true. Dell held a legal interest and not an equitable one. Even if he was deemed to hold it on truste for himself and Anne there was only two trustees. Money would have to be paid to at least two trustees for overreaching to occur. This is wring.

c. If this is registered land then the doctrine of notice does not apply. If it is uunrgeiesterd then this would not apply still.

Quick quiz. Page 31. Law of property.

Anne wants to transfer her unregistered title in Whiteacre to Paul. Which is the correct method?

a. She hands the bundle of deeds she has to Paul.

No, this is wrong. She needs to have a deed prepared by a lawyer to grant the title to Paul.

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b. She hands Paul a deed which states that Anne transfers Whiteacre to Paul – the document complies with section 1 LP . MP. Act 1989.

Yes, this is valid. The sale will need to be registered under the Land Registration Act 2002.

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c. She and Paul agree a document which states that Anne is going transfer Whiteacre to Paul – the document complies  with section 2 Law of Property Miscellaneous Provisions Act 1989.

This is not quite the same. This is an estate contract rather than a conveyance itself.

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Activity 2.5 Page 30. Law of Property

Paul transfers the unregistered title of Whiteacre to Samantha for GBP 10 000. Will Samantha be bound by the following interests, all of which arose prior to the sale of Whiteacre to Samantha?

a. An easement granted by Paul to his neighbour Bethany?

This depends on whether Samantha knew about it or not. Bethany should have registered this as a land charge. If so that constitutes notice to the world and it will bind Samantha who is Paul’ successor in title. It is not an easement of necessity – because that would have not have been granted – which would have been binding regardless of notice. The easement is overreachable. This is unregistered land so the doctrine of notice applies.

Legal rights bind the world in unregistered title. The word granted implies that there was a deed and a deed would have created a legal right. Bethanty would need to register it as a land charge to make her case water tight because if it was not  a legal easement but an equitable easement it would be overreachable.

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b. A restrictive covenant granted by Paul to his neighbour Saskia?

This hangs on whether or not it was registered as a land charge. IIf yes then yes. If no then no it is not binding. A restrictive covenant can only be equitable. If granted before 1925 then it will be governed by the doctrine of notice and that would bind Samantha unless she is equity’s darling. If granted after 1925 then Saskai should have registered it as a land charge. That determines whether or not it is binding.

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c. Eloise’s beneficial interest in Whiteacre arising from her contribution to the purchase price Paul paid when he bought the property?

This like Kingsnorth Finance Ltd v Tizard. This is a resulting trust which is even more advantageous to the beneficiary than a constructive trust. She contributed to the purchase price. If she has registered her interest it is inassailable. If not then it will still prevail if supported by actual occupation as in Tizard – though that was a constructive trust. If she is not resident then it is overreachable. Her occupation – if at all – is discoverable.

Her interest is not registrable under the Land Charges Act 1972. It will not have been overreached as Paul is the only trustee – the purcahse money needs to be paid to two or more trustees to be overreached. Whether this is binding depends upon the equitable doctrine of notice.

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d. Tamara’s licence to occupy Whiteacre?

No. Licences are never binding. IIt is not a property interest. It exists in personam.

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e. The option to purchase Whiteacre Paul granted to Chris?

This is like Green v Midland Bank. It is registrable. If registered this equitable interest will prevail. If it is not registered then it will be defeated. It can be a land charge of class C iv.

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f. How, if at all, would your answer to each one of the questions change in each of the following alternative circumstances?

– Samantha paid ten pounds for Whiteacre

Yes, she is the bona fide purchaser of legal estate for value and if she is without notice then she is equity’s darling. In this case she can defeat all the interests above if she has no notice of them. She iis still a buyer as per Midland Bank v Green as this is value.

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– Samantha gave a peppercorn for it

This is nominal consideraton but it is still valuable. As this is unregistered title it makes no difference. In registered title it would be different.

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– Samantha gave no consideration

This is not valid consideration since it has no economic worth. It is derisory and an insult to the courts. Therefore she is a donee. She can defeat the licence and nothing else. As she got it for free she is not losing out as much as if she had paid for it. Courts are less sympatheitc to donees that buyers. She is not a purchaser under the Lan Charges Act in terms of registrable interests. She is not equity’s darling and cannot defeat overreachable interests.

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– The legal title to Whiteacre was co owned by Paul and Gordon who jointly conveyed it to Samantha.

They had joint tenancy. If the money is paid to both trustees then Eloise’s beneficial interest  will be overreached. This is the case even iif she is equity’s darling.

Overreaching has no effect on an easement or a restrictive covenant since these are excluded from overreaching under the Lae of Property Act 1925. So this does not change the earlier answers.

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Self assessment questions. Page 29. Law of Property.

1. When will a purchaser be bound by a restrictive covenant entered into before 1926?

When he has notice of it. The doctrine of notice still holds good here.

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2. What is the consequence of failure to register a land charge?

Then the interest will not be protected. It shall be overreached. The buyer probably had no knowledge of it.

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3. Which equitable interests are still subject to the doctrine of notice?

This are ones in unregistered land.. The doctrine of notice does not apply to registered land. These equitable interests are constructive trusts, resulting trusts, options to buy, estate contracts, easements and restrictive covenants.

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4. What is constructive notice and when does it apply?

This is when a buyer ought to know something. The person who has the interest has not told the buyer but the right holder’s interest was easy to discover by a fairly careful buyer. It goes back to the old maxim – caveat emptor.

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Activity 2.3 Page 29. Law of Property

Read the Kingsnorth Trust Ltd v Tizard and make notes of its relevant facts, decisions and ratio. Answer the following questions.

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This is a 1986 case. Tizard was the sole registered owner of land. This was his home and he lived in it with his wife. His goodwife had a beneficial interest in equity in the said domicile. The marriage was shattered. Mrs Tizard moved out but the twins remained behind. The woman returned daily to care for her progeny. When her estranaged spouse was away she would sleep in the dwellinghouse.

Tizard mortgaged the house and on the application said he was single. An inspection of his house took place and he contrived for this to take place a’Sunday when his wife would be out. The agent inspecting the home realised that children lived there but found no evidence that children did. Mr Tizard said that his wife had long since departed and had now taken up with someone else.

Kingsnorth took the house subject to the wife’s interest. The agent should have looked at the house at a time of his choosing and not a predetermined time. The agent had not taken reasonable steps to see that the wife did not live there. The wife had a constructive trust and this was binding on Kingsnorth Finance Ltd. Kingsnorth had sought to rid itself of this but failed.

a. Why was it important that he husband was the sole legal owner?

Because the wife could only have a constructive trust and not legal joint tenancy. Moreover, it was possible for her constructive trust to be hidden. The agent had reasonable notice of this but failed to take notice. They had constructive notice of the wife’ interest. The man had held the property on trust for himself and the wife who had 50% of it.

It is important that the hubby was thhe sole legal oowner because if thhere are TWO OR MORE TRUSTESS then overreaching will operate.

It is controversial that the wife was found to be in occupation. This goes against Caunce v Caunce 1969. It develops on from William and Glyn’s Bank v Boland. Boland defined occupation.

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b. How did the bank know that Mr Tizard had not provided them with the full facts?

They found there were children there. Tizard later admitted to being married but said his wife had moved out which was half true.

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c. What should the bank have done?

The bank should have inspected at a time of its choosing and made sure he was not married and no other adult lived there. They ought to have inquired more deeply once they found he had misled them.

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d. Did the court criticise the surveyor for not opening cupboards and drawers (be very careful on this question and read the case rather than what the textbook writers sometimes say on this point!)?

They said that he did not carry out a diligent inspection. He argued that it would be daft for him to open drawers and cupboards. This would invade the privacy of people too much and it would be embarrassing for mortgagees to do so.

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e. Did the court agree that in the context of residential land it is necessary for surveyors to make an appointment to view the property? Why might it be different in other contexts such as commercial property?

I do not quite agree. People should be required to tell the truth. People should not benefit from dishonesyt that is unjust enrichment. I knw the wife did not deceive anyone but she gained from another’s lie.

In commerical property one doe snot expect people to be there outside office hours. No one lives there. In a commercial property it is acceptable to turn up any time during business hours. The court was inconsistent in saying he needed to agree a time to visit a residence and then they slammed him for doing so.

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f. On what basis did the court criticise the inspection (this is not an easy question – particularly if you read the case before answering the previous questions)?

It was done at a time appointed by Tizard and on a Sunday. This was suspect.

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g. Would this case have been decided differently if the land had been registered? Was it Mrs Tizard’s beneficial interest or her occupation of which the mortgagee was deemed to have constructive notice?

No, because the register is seen as definitive. It is possible for some interests to exist that are not on the register but this is unlikely to have been the case here. It might have counted as an overriding interest – this would be due to actual occupation which was discoverable and not due to constructive notice of her interest.

It was the occupation because that was discoverable by a reasonably competent inspection. Her beneficial interest could not be found except by someone’s declaration.

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h. Do you agree with the case – there is no reason why we should all agree – what do you think and why?

No, I do not concur. This is too hard on Kingsnorth Finance Ltd. It worked out well for the wife and children. It makes people less likely to lend money. It also makes it more difficult to borrow because lenders can have equitable interests forced on them that they did not know about. The woman gained financially from another’s mendacity.

Self assessment exercise. Page 27. The Law of property

1. Is an unregistered estate enforceable against:

a. the purchaser of an equitable interest in land, or

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No, it is not enforceable because it is not registered. An equitable charge is void against the purchaser for value of the land or any interest in the land. Whether the this is a legal or an equitable state or interest does not matter.

b. the purchaser of a legal estate for marriage consideration?

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No, it is not enforceable. In equity marriage consideration is still valid whereas it is not in law.

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2. What is a land charge and how is it protected?

A land charge is an equitable interest in another’s land. It is protected by registering it with the Land Charges Registry. The mechanisms around this are dictated by the Land Charges Act 1972 which displaces the Land Charges Act 1925. A land charge is registered against the name of the estate owner. The charge is NOT registered against the land itself. This is arguably a big drawback for the whole system. The registration of the land charge is notice to everyone. SO no one can rightfully claim that he did not know about a land charge on land that he is purchasing. HHe ought to have looked at the register. A buyer only needs to look back at the Land Charges Register for who has owned it for the last 15 years.

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3. Give examples of land charges and the categories as which they should be registered.

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Land charges which can be registered are estate contracts, options to buy, restrictive covenants, a puisne mortgage (pronounced ”puny”), an equitable easement, a spouse’s or civil partner’s right of occupation under the Family Law Act 1996.

The categories are class C i, class C iii, Class C iv, Class D ii, Class D iii, Class F

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4. When will a purchaser be bound by a land charge?

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If the land charge is registered then he will be bound by it. If the land chargge is not registered then a purchaser for value will NOT be bound. But if someone gains land by inheritance or as a gift then the donee will be bound by the charge even though the charge is not registered.

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5. Define: (a) purchaser for value; (b) purchaser for money or money’s worth. Is there any logical reason to have two separate categories?

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A purchaser for value is someone who pays a fair price for the land. It may be below the market value but so long as it is not ridiculously small then the consideration paid will be valid.

A purchaser for money has to give some money however small. Instead of money he can give something else such as exchanging land, giving services instead, giving gold, chattels etc… So long as the consideration has some pecuniary value. An emotion is not consideration.

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Prince William – for thhe Russian market

The whole world knows Prince William‘s public persona but what is he like one-on-one? I was at Eton College with Prince William and some of my friends are still in regular touch with him. His Royal Highness’ true personality is not entirely what you would expect. He experienced the divorce of his parents and the death of his mother by the age of 15. This would traumatise most people but how have these tragedies shaped the personality of the future king of 16 countries?

Prince William is very self-assured and outgoing. Perhaps more surprising is his intellectual incuriousity and his fondness for racy jokes. Whenever any intellectual topic came up in conversation he would glaze over. He is of average academic ability. His French is not so good and he knows none of his ancestral language – German.  This is a pity because he needs to speak French to some of his grandmother’s subjects in Canada. Remember Queen Elizabeth is the queen not just of the United Kingdom but of 15 other lands – Australia, Jamaica, New Zealand and so on. I once asked Prince William which countries his grandmother ruled and he could only remember half of them. Many of them are small islands in the Caribbean.

Prince William had a lively sense of humour and as a little boy said to his classmates, ”when I am king I will order my soldiers to chop your head off!” Everyone knew this was just comedy. He was notably humble and willing to deprecate himself.

Because he was scholastically middle of the road he did not go to Cambridge (which Prince Charles attended) or Oxford (which some other British kings attended). Instead he went to St Andrew’s University in Scotland. It may be hard to believe in Russia but British universities do not make exceptions for royalty. In the United Kingdom there is a very strong feeling that the royal family should only be awarded qualifications that they have earned.

There were many societies at Eton where boys would develop their interest in everything from Philosophy and Debating, to Amateur Radio and Farm Management. Prince William never attended any such societies expect when some animal rights activists came to speak about why fox hunting should be outlawed. Prince William spoke up vociferously in favour of keeping hunting legal. It is astonishing that the press never reported this at the time. It is no secret that he likes blood sports or as he prefers to call them ”field sports” and he has often been filmed riding to the hounds. I used to go beagling with him. A beagle is a small dog. Remember Charles Darwin’s voyage? His ship was called the beagle. Anyway, we would go by minibus to the estate of a a different Old Etonian twice a week. Sometimes it was Lord Carrington’s estate – Lord Carrington was once the Foreign Minister. We would follow the beagles as they chased and killed. I was a schoolboy who would look at racy magazines full of girls in bikinis. I remember Prince William borrowing my copy of Loaded and reading aloud ”gravity defying Brazilian buttocks!” as admired some nubile girls.

He showed a total lack of interest in politics which in a sense is a good thing. The monarch is the only person who is not entitled to an opinion. The Crown is above politics. The monarch must always maintain the strictest neutrality in political affairs. The monarch is not allowed to vote by law.

Prince William never attended the theatre. His indifference to drama is at odds with his mother who was quite enthusiast about the theatre. Nor is he musical. Prince William does at least like the visual arts and is a reasonably talented painter. He studied History of Art so he can develop a greater appreciation of his family’s collection of masterpieces.

Prince William was not at all religious which is typical of a Briton. When he had to sign the entry book to the school he paused at the space for ”religion” and asked his father what to write. ”Church of England” Prince Charles told him indulgently. There were optional prayer services in chapel every day but he only went when it was obligatory.

He is convivial and usually upbeat. His parents divorce affected him surprisingly little. The one thing his parents could agree on is that the boys MUST attend Eton. All of Princess’ Diana’s male relatives attended Eton. Some of Prince Charles’ cousins attended Eton but PrinceCharles was sent to Gordonstoun School in Scotland which his father Prince Philip had attended. Gordonstoun was chosen for PrinceCharles because it was thought to be tougher and almost military. Prince Philip said that Eton was too close to London and too culturally sophisticated – he wanted his son to be a sailor like him.

What astonished me is how soon he returned to school after the violent death of his mother. I never felt it right to ask him about this extremely sensitive topic. I sensed that although he blatantly experienced grief he was coping exceptionally well in the circumstances.

His friends were mostly drawn from aristocratic circles. These boys were the sons of his parents’ friends.  Only a minority of boys at Eton are the sons of noblemen. Most boys are the sons of highly successful bankers and lawyers.

Prince William was suspicious of overtures of friendship. He was wise before his time because he knew there were plenty of sycophants and tittle tattles who might betray him. He was well aware that some people only wanted to suck up to him because he was due to be king. He was also cautious around girls. At the Feather’s Ball girls were lining up to try to kiss him but he rejected them all – there were too many people watching.

He could he as normal there as at any other school. Curiously, he was not close to the other royalty at the school. Prince Nirajan of Nepal was there. Although Nirajan went to Buckingham Palace occasionally he never became friendly with Prince William – there was no enmity. The same is true of the Saudi Arabian prince at Eton.

Prince William smoked a little but soon gave up. He hardly drank alcohol. He was known to have never touched cannabis. From his teenage years he showed a deep sense of responsibility. Millions of people in his grandmother’s many kingdoms look up to him. He must not fail them. He avoided controversy and I cannot think of anything he did to ever stain his family’s honour.

He regards himself as being from Gloucestershire. This is a county in the West of England. He spent most of his time there because his father, Prince Charles, owns a house in Gloucestershire called Highgrove. Prince Charles bought Highgrove in 1980 . Why did PrinceCharles buy a house in a part of the country with which he had no connection? Highgrove is a 10 minute drive from the house of Camilla Parker Bowles – who was always Prince Charles’ true love. Camilla Parker Bowles was then married to a cavalry officer – Andrew Parker Bowles.

Camilla Parker Bowles’ son – Tom Parker Bowles – was at Eton but finished school before Prince William arrived. Incidentally, there is no suspicion that Prince Charles is the father of Tom. For the first couple of years of Camilla’s marriage it is common knowledge that PrinceCharles left her alone to have children while he attempted to find a bride he loved.

Prince William inherited the cool headedness of his father. His brother Prince Harry is more emotional like his mother. Prince William is also the cleverer of the two. Princess Diana said of Prince William, ”that child is a deep thinker”. Prince William like his mother is a people person. He was confident and willing to talk to boys much older than him on equal terms.

Prince William was a fairly talented sportsman. He was a decent football player and excellent at water polo. He almost made the national water polo team. He also liked rowing rather than the more popular cricket. He took plenty of exercise and always watched what he ate because it is difficult to respect an obese king.

Prince William is fairly well-suited to the role. Do not imagine that he is superhuman and extraordinarily gifted. This is perhaps the strength of the monarchy – that the monarch is usually a person of quite typical abilities. Likewise that is what is so splendid about Eton. It can take boys of average ability and empower them to achieve far more than you might expect – in their academic subjects, in music, in drama and in sports. Boys leave absolutely brimming with self-belief. Nothing is ever achieved without confidence.