Land Law: Fixtures and Chattels

Land

• According to Section 205 (1) (ix) of the Law of Property Act 1925, land includes any tenure, mines, minerals, buildings, parts of buildings, corporeal hereditaments, manors, advowsons, rents, incorporeal hereditaments, easements, rights, privileges, or benefits derived from it.
• Corporeal hereditaments encompass a land’s characteristics that can be inherited like trees, earth etc.
• The feudal concepts of manor and advowson have reduced modern applications.
• Bernstein of Leigh (Baron) v Skyviews & General Ltd 1977 restricts airspace above land to what's needed for ordinary enjoyment and structures.
• Fixtures are considered part of the land and a chattel is an item of moveable property
• Shelves, cupboards, mirrors, and lights become fixtures once attached.
• A seller may want fixtures classed as chattel; a buyer would want them as fixtures.
• Berkley v Poulett 1977 uses a Two-stage test to determine if an object is a fixture or chattel
• A degree of physical annexation to land is required for an item to be a fixture.
• If an object is affixed, it's presumed a fixture unless removal causes serious property damage

Object and Annexation

• Presumptions from the annexation's degree can be challenged.
• Items attached to enhance a room are fixtures.
• Chattels affixed for better enjoyment remain chattels.

Exceptions to Fixture Rules

• Sellers can reserve the right to remove fixtures in the sale contract.
• Tenants can remove trade, agricultural, or ornamental fixtures.
• Berkley v Poulett 1997 ruled that Pictures, Sundials, and Status are not fixtures, but plinths are.
• D’Eyncourt v Gregory 1866, freestanding items integral to architectural design are fixtures like tapestries, carved kneeling figures, sculptured marbled vases and stone garden seats.
• Leigh v Taylor 1902 determined that tapestries remained chattels.
• Elitestone Ltd v Morris and another 1997 held that removable houses can remain chattels.
• Botham v TSB Bank plc 1997 regarded fitted carpets, curtains, light fittings, gas fires connected by a pipe, and standard-sized white goods as chattels, while Fitted kitchen units were fixtures.

Doctrine of Tenure

• Concerns the way land is held from whom and on what terms
• It’s found in leases where tenants pay landlords for occupancy rights.

Concepts of Estate

• Owner → Estate (period of time) → land
• Section 1(1) of the LPA 1925 stipulates that the two estates in land capable of being conveyed or created are freehold and leasehold
• Section 1(1)(a) of the LPA 1925 recognizes that an estate in fee simple absolute in possession is capable of existing at law
• Fee is inheritable
• Simple may pass to any class of heir
• Absolute is not conditional
• In possession means entitlement to possession now
• Section 1(1)(b) of the LPA 1925 identifies a term of years absolute as the other type of estate that is capable of existing at law
• Leasehold estates last for the lease duration and can be sold or inherited
• To qualify as a leasehold: tenants must have exclusive possession with certainty of duration
• Exclusive possession means the tenant must be able to exclude everyone, including the landlord
• The LPA 1925 defines 'term of years' as any fraction of a year

Third-Party Rights and Interests

• Legal interests according to s 1(2) LPA 1925:
• Easements give rights over another's land.
• Legal mortgages secure loans.
• Equitable interests according to s 1(3) LPA 1925:
• There are equitable Interests under trusts like beneficial interests
• In equitable interest with no trust:
• Restrictive Covenants restrict land use.
• Contracts to create or convey legal estates give buyers an immediate interest.
• Equitable easements come without a specific time.
• According to Statute, Home Rights(s 30 FLA 1996):
• Parties must be legally married
• It extends to civil partnerships.
• Licenses encompasses bare license and contractual license

Formalities for Creation of Estates and Interests

• Legal interests and estates must be created by deed, per Section 52(1) LPA 1925
• The requirements for a deed according to s 1 Law of Property Act (1989):
• Intent to create a deed
• Signed, witnessed, and delivered
• The (s 54(2)) Parol Lease exception to deeds:
• Leases for 3 years or less can be oral.
• Lease must take effect in possession immediately
• Best rent must be reasonably obtained
• According to Section 52(1) LPA 1925, legal easements require deeds
• Section 25 LPA 1925 states Deeds are required to transfer legal interests unless title is unregistered which uses conveyance
• Creation of Equitable Estates and Interests uses express trusts, according to s 53(1)(b) LPA 1925
• Section 53(2) LPA 1925 dictates that Implied trusts have no formalities
• Certain equitable interests should to be in writing and signed (s 53(1)(a) LPA 1925)

Unregistered Conveyancing Transactions

• Various actions are taken in conveyancing, including surveys and boundary checks.
• Enquiries are made regarding roads and investigate the seller's ownership.
• Exchange contracts, prepare transfer deed, complete the purchase and move into the property
• In stage one (exchange of contracts) buyers get equitable interest.
• In stage two (completion) a deed is executed to transfer legal ownership
• In unregistered systems, legal ownership transfers on conveyance date
• Since Sellers prove rights by showing 15 years of title deeds SECTION 44 LPA 1925, conveyances can also reveal third-party rights

Disadvantages of Unregistered Systems

• Include the potential for forged deeds
• Genuine deeds may lack crucial transaction records
• Titles are not uniform, requiring extensive conveyance reviews

Enforceability of Third-Party Rights

• Proprietary interests can bind buyers not party to their creation
• Land Charges Act (LCA) 1972 governs the third-party interests
• Section 2 LCA 1972 dictates registrable rights on the Land Charges Register.
• They include estate contracts, restrictive covenants, easements, home rights, and puisne mortgages
• Registration constitutes notice to all, according to s 198 LPA 1925
• Purchasers are bound by registered charges while effect of non-registration and a transfer is according to Section 4 LCA 1972
• The term purchaser includes mortgagees and lessees
• Knowledge is irrelevant to unregistered land charges, the court case Midland Bank Trust Co Ltd v Green 1981 ruled

Pre-1926 Rules

• Legal interests bind the world, ignorance is not a protection for property buyers
• Equitable interests enforceable against all except bona fide purchaser without notice
• An "Equity's darling" purchaser 5 criteria:
• Good faith
• Qualify as a purchaser
• Buy for value
• Take legal estate per s 1(1) LPA 1925
• Buying for property without NOTICE: actual, constructive including what could have reasonably been found, or imputed which is anything their solicitor had notice of
• Pre-1926 rules apply to interests outside the Land Charge Act 1972
• Includes: Equitable interests under a trust, most legal interests, and Pre-1926 equitable interests
• To remove third-party interests: before the sale negotiate a release

Overreaching

• You can remove express or implied equitable trust interests so the buyer takes land free of beneficiaries interests (to overreach a beneficial interest):
• Buyer gets legal estate
• Buyer pays purchase money to at least two trustees
• At there must be at least two trustees

Registered Conveyancing

• There are twp stages: Leads up to exchange of contracts and completion
• The transfer deed takes the form of a transfer
• The law relating to the transfer of registered titles in contained in the Land Registration Act (LRA) 2000 and the Land Registration Rules 2003

Transfers of Ownership

• Sellers prove ownership with Land Registry copies.
• The register is divided into 3 parts: Property, Proprietorship, Charges

Property Register

• Contains land description, title plan, and rights benefiting the title
• Proprietorship register states class of title, owners, restrictions

Charges Register

• Contains third-party rights burdening the land and registered charges

The transfer process

• The Section 27 of the LRA 2002 stipulates that legal estate in register is only transfered when buyer's name is on the register
• Leases under seven years cannot be registered
• Any lease >7 years can be registered
• Unregistered titles gradually become registered ones

Compulsory First Registration

• Voluntary registration doesnt happen often
• Compulsory first registrations occurs when land is sold and triggers the obligation to register
• Section 4(1) LRA 2002 outlines trigger events: sales, gifts, court orders, and legal leases any > 7 years
• Where there is an obligation to apply for first registration. The application must be made within two months of completion
• Section 4(1) LRA 2002 – Where there is an obligation to apply for first registration and it wasnt, the application must be made within two months of completion and it is void

Enforceability of Third-Party Interests in Registered System

• 3 categories of rights exists over registered titles:
• Registrable dispositions
• Interests that affect a registered estate
• Interests which override
• LRA 2002 enacted October 13, 2003 and anything before is subject to LRA 1925*

Interest that binding purchaser post LRA 2002 s29 LRA

• entries on register
• Unregistered interests that override registered
• Valuable consideration defined in s 132 LRA 2002 and excludes marriage consideration and nominal consideration in money

Sections LRA 2002 s 27

• The Creation of a legal mortgage and the express creation of a easement bind any land purchasers
• Registered dispositions under s 27 is the creation go a leasehold estate for a term of more than seven years
• LRA 1925, pre 2002 only leases >21 yrs were registrable
• Interests affect a registered estate if notices are on a register according to Sections 32 and 29 LRA 2002
• Restrictive covenants, estate contracts, and Family Law Act 1996 rights need a notice in the charges register
• These interests can be overreached

Important LRA 2002 paragraph 2

• Over registered land interests always consider Schedule 3 paragraph 2 that allows the rights holder to protect if holder in actual occupation of relevant land
• Trust interest and beneficaries cannot be protected must be restriciton on the preoprietorship register section (s 40 LRA 2002
• Trust interest can be overreached if buyer pays purchase money to at least 2 trustees as described on (s 27 LRA 1925
• The restriction will alert buyers to the need to never reaching

Interest that override Unregistered Interest which override

• Interest bind a purchaser if in exists
• List of interest override in schedule 3 LRA 2002
• Legal lease grantees for a term not exceeding seven years s1 LRA 2002
• Legal easements can be claimed under LRA
• The easement must be binding on a purchaser only if, since 13 octtober if the purchaser new has had to have known or if it would have been obvious

Qualifying overide Paragraph 2- Para 2 LRA

• Para 2 LRA interest must be property
• If its just licensing and other situation see other provision
• The spouses need to see that they have proper housing
• Schedule 3 gives Para 2- 2 a 2002 date of competion and disposition. They need the proper status in the time period

Schedule Paragraph 2 and Other Limitations

The interest will over only if:

• The occupation is to have been Obvious or what could be reasonably care of
• To claim Sch 3

Overreaching

• Important factor
• The purchaser discovers that even if someone other then the seller. Still under sch 3

Trustee Laws

Where a new trust is created over land after 1 January 1997

• it can only take the form of a trust of land

Trustees of land and their power

• s6 TLATA( 1966)- Power in trutes. They have right and power
• Power the Trustee had: -6- Trustee the power to the specified way Trustee can buy and sell: - The trust must regard to the right the powers Trustee have power to: regard to all trustee laws

Restrictions on the trustees power restricted Trustee in the exercise the power -

The duty to consult the utes with all the right Benefeciaries need to sign. trustee is Selling land

• TLA - Trustee sign power

• • Trustee be consult and sell with any member or signor -

• the beneifcares does sale that if the signed has power or desell so they can sell. power 5 rights

6 Trustee

• Need a certain Trustee is assigned to the trust to be the Trustee

• Be consult with every - all rights

• every all - Bencieiares all sign Trustee

• trustee the Trustee or Trustee sell sign Trustee sell

There must be at least two Trustees

• Every time a sale must be assign/ or Trustee or trustee all

• Every time a signed must be assignment Trustee sign

6 Trustee Trustee

• need a Certain Trustee right
• the trustee every -every all power every Trustee Trustee sign