Summary
Summary SQE2 - Black Letter Law Land
- Module
- SQE2
- Institution
- University Of Law (ULaw)
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FIXTURES & CHATTLESIf the contract is silent on what is included in the sale then objects must be classified as either
fixtures or chattels.
Fixtures ‘form part of the land and are included in the sale of the land’. Chattels are removable
objects, that can be taken when the seller leaves.
There are two tests that need to be applied to ascertain whether an object is a fixture or chattel.
1. Degree and method of annexation (Berkley v Poulett) - Creates a presumption that if an object
is firmly attached to the land then it is a fixture and if moveable or freestanding then it is a
chattel.
2. Object and purpose of annexation - This test asks whether the item is there to form part of the
architectural design (D’Eyncourt v Gregoryt) or if the object is just there to be enjoyed by itself.
This test can rebut the presumption made in the degree test if the item enhances the realty. This
test also looks at whether annexation is the only way an object can form its purpose (Leigh v
Taylor).
Cases:
1. D’Eyncourt v Gregoryt - tapestries fixed into panelling and stone figures around staircases are
fixtures as they enhances the property.
2. Leigh Taylor - tapestries were firmly fixed but it this was the only way they could be enjoyed so
they were considered fixtures.
3. Elitestone Ltd v Morris - removable parts of a house can be a chattel if mobile e.g. mobile
greenhouse.
4. Botham v TSB Bank - carpets, curtains, light fittings and white goods of standard size were
chattels but fixed kitchen units were fixtures.
ENFORCEABILITY OF THRID PART RIGHTS
Interests can be binding to the purchaser thus it is always apt to consider third party rights.
First thing to do is identify the type of third party right.
Types
Easement - An easement is a right that is a ached to one piece of land and imposes a corresponding
burden on another piece of land
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,Is it capable of being legal
s.1(2) or s.1(1)(b) LPA extends to easements (s.1(2)(a) LPA 1925), mortgages s.1(2)(c) LPA 1925)
and leases s.1(1) LPA 1925.
Issues that are not capable of being legal are restrictive covenants, estate contracts, options,
beneficial interests, trusts and FLA rights(s.1(3) LPA, these are only capable of being equitable.
FLA rights = statute.
The only interests or charges in or over land which are capable of subsisting or of being conveyed
or created at law are -
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; A charge by way of legal mortgage.
What are the formalities and has it been validly created?
• Legal leases - the length of of the lease has a bearing on the formalities needed. For a lease
greater than 7 years a deed (s.52(1)LPA) to be signed sealed and witnesses (s.1LP(MP)A). If
however it is a parole lease (s.54(2) LPA 1925), which must:
- not exceed 3 years
- be immediately effectively
- be obtained at the best possible rent without a large upfront payment
then no deed is required.
• Legal easement - must be equivalent to term of years absolute (s.1(2)(a)) and it must be signed
sealed and witnessed by deed (s.52(1) LPA). Additionally, although an implied legal easement
(Wong v Beaumont Property Trust) does not require formalities it must be both impliedly
required for the duration of a legal estate (s.1(2)(a) LPA) and implied into a deed.
• Charge by legal mortgage - created by deed (s.52 LPA 1925) as well as being singled witnessed
and delivered (s.1 LP(MP)A 1989. It must also be clear that the document was intended to be a
deed. Will only be legal if it is registered (s.27 LRA)
• S.30 Family Law Act 1996 right - one must be married/ civil partnership, the home must have
been or was designated to be the marital home and the legal owner must still be alive for these
rights to be applied.
• Restrictive covenant - Signed and in writing (s.53(1)(a) LPA.
• Equitable lease - must be signed by both parties, in writing and containing all terms (s.2(1)
LP(MP)A). They must also be capable of specific performance (Walsh v Lonsadle).
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,• Equitable easement - Singed and in writing (s.53(1)(a) LPA. Additionally, correct formalities for
an estate contract = signed by both parties, with all agreed terms, in writing (s.2 LP(MP)A), can
be equitable if it fails s.1(2)(a) or s.52(1).
• Estate contacts - Signed by both parties, in writing contains all agreed terms (s.2(1)LP(MP)A).
• Trusts - express trusts must be signed, in writing by the settlor (s.53(1)(b)) LPA. `implied or
resulting trusts may come about without formalities (s.53(2) LPA) e.g contributing to purchase
price (Bull v Bull).
Classify the Interest
Legal, equitable or statutory?
Will it bind the buyer?
REGISTERED SYETEM
Classify the right as either a registrable disposition, an overriding interest, a trust interest of an
interest affecting a registered estate (IARE).
Registrable disposition
- legal leases over 7 years (s.27(2)(b)(i)LRA and s.4(1)(c) LRA 2002)
- express legal easements (s.27(2)(d) LRA 2002)
- legal mortgages (s.27 LRA. 2002)
In terms of enforceability if the right has been registered then it is binding, if it has not been then its
not binding (s.29 LRA 2002).
Overriding interest
Must exist by date of registration of buyer as new owner (does not have to be registered). For
schedule 3 para 2 the date of registration of the buyers as the new owner is the relevant date for
assessing actual occupation.
- legal leases for 7 years or under (includes parole leases) (schedule 3, para 1 LRA 2002)
- issues protected by actual occupation (schedule 3 para 2 LRA 2002)
- Legal easement created by prescription of implication
There are 4 requirements needed for schedule 3 para 2 to bind despite not being registered:
1. Claimant of actual of interest must have actual interest in the land
2. Must be in actual occupation
3. the occupation must be obvious upon a reasonable inspection or the purchaser must have actual
knowledge of the interest (Kingsnorth v Tizard)
4. Person must disclose interests upon an enquiry being made (Kingsnorth v Tizard)
Cases:
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, Actual occupation requires some actual presence e.g. ‘moving in steps’ (Abbey national v Cann).
Actual occupation requires ‘physical presence on the land’ (Williams & Glyn’s Bank
v Boland).
visiting a semi-derelict site regularly was sufficient to be actual occupation (Lloyds Bank v Rosset).
Regularly parking in a garage constituted actual occupation of the garage (Kiling v Keston)
Occupation by a friend or relative for their own purposes does not amount to actual occupation
(Stand Securities v Caswell).
Even if you are in hospital for a year, if you pay the bills, leave possession and is it regularly and
had plans to move back in then there is actual occupation (Link Lending Ltd v Bustard).
A minor cannot be in actual occupation, they will be classes as shadows of their parents (Hypo
Mortgage Services).
However, someone who leaves their possessions but has no intent to return does not have actual
occupation (Thompson v Foy).
If a person usually resides at a property a temporary absence will not stop them from claiming their
interest (Chhokar v Chhokar and Kingsnorth Finance v Tizard).
- legal easements ceased by implication or prescription Schedule 3 para 3 LRA. 2002). There are
limitations to these interests:
1. the purchaser needs to know about the easement in advance; or
2. the easement would have been obvious on close inspection; or
3. the easement has been used within the last year
In terms of enforceability all the above are binding without registration. However, interest protected
by actual occupation can be overreached.
Trust interest
Interests of beneficiaries under a trust of land. The trust interest must be registered by way of a
restriction on the proprietorship register (s.40 LRA 2002). This will prevent the buyer(who had not
overreached) from being able to register as the new owner. It will also alert that buyer that they
need to overreach in order to take free of the interest.
The purchaser may still overreach despite the registration, by paying the purchase price of the land
to all the beneficiaries of at least two in number (ss.2(1)(ii) and s.27(2) LPA; City of London v
Flegg).
The beneficiaries can only gain limited protection. For example the interest cannot be protected by a
notice (s.33 LRA 2002).
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