1
Q
What is a freehold estate in land?
A
You have the indefinite ownership
Full control to sell, lease, mortgage, develop or give away the land in your will
2
Q
What is a leasehold estate
A
You have the right to occupy for a fixed term. You can only do what is stated on the lease.
3
Q
What are the types of leasehold?
A
Residential and commercial leases
4
Q
Describe a residential lease?
A
Can be short term or long term. For residential purposes only. You pay a premium upfront and then a small amount for rent fees. Only long term leases can be assigned.
5
Q
What is a commercial lease
A
For business purposes. Rent paid monthly or quarterly at market rent charges for 5,10,15 year terms. Only the landlord can assign the lease.
6
Q
What does land include in a conveyance
A
Physical land, air above, ground below, fixtures, proprietary rights
7
Q
What are fixtures
A
Property attached to the land
8
Q
What are chattels
A
Property not attached to the land
9
Q
What is an estate in land
A
The right to occupy the land as the estate owner
10
Q
What can a freehold estate owner do
A
Occupy the land indefinitely, sell/lease/mortgage, develop the land, give land away via will
11
Q
What does a leasehold estate owner do
A
Right to occupy land for a fixed term, can only do things specified in the lease
12
Q
What are proprietary rights
A
Rights that pass with the land, can bind successive owners of the land
13
Q
What is an easement
A
A right of way for one owner to have a benefit of the land of another owner, usually neighbouring land
14
Q
Common interests in land, that can bind successive owners
A
Easements, mortgage, restrictive covenants and interest under trust
15
Q
3 Types of easement
A
Express, implied, prescribed
16
Q
What is an express easement
A
Created by deed
17
Q
What is an implied easement
A
Not created by deed, court implied
18
Q
4 Types of implied easements? NCES
A
Easement By necessity, by common intention, by existing use, implied by statute
19
Q
Implied by necessity
A
Land locked property must have an easement to the road by necessity
20
Q
Implied easement By common interests
A
Both parties have same intention to grant right over the land
21
Q
Implied easement By existing use
A
Previous owner had continuous and apparent use of the land, it was necessary for enjoyment of the land, and used by seller at time of conveyancing
22
Q
Implied easement by statute
A
Given by regulation if separate owners used land continuously and it’s apparent, right exercised at time of conveyancing, and this right isn’t excluded in the conveyance
23
Q
Prescribed easement
A
Use over 20 years, no permission but used as a right, not used in secret
24
Q
When is an indicative redemption figure needed
A
If outstanding mortgage, seller’s solicitor will request the lender provide this figure to ensure proceeds of sale covers the outstanding mortgage
25
Latent defect
Things that would not be apparent for inspection on a property
26
Patent defect
Physical defect in property easily discoverable upon reasonable inspection
27
What's in a register or title for registered land
1) title number
2) property register
3) proprietors register
4) charges register
28
Describe a property register
1) Property address;
2) If property is freehold/leasehold; and
3) If any benefits from neighbouring land
29
What's in a proprietors register
1) current owner with legal title
2) Their class of title
3) any other interest in land like a Trust
30
What's in a charges register
Easements, mortgages, restrictive covenants, notices of other burdens on land
31
What's an overriding interest in land
1) not on the Register of title
2) an interest in land that binds the buyer in a sale of property
32
Main types of overriding interest
1) legal lease of 7 years or less
2) implied legal easement
3) interest in land or non-owning person in actual occupation
33
What are the types of class of title with HMLR on the proprietors register
1) absolute title
2) qualified title
3) possessory title
4) good title
34
What's an epitome of title
A chronological summary proving a property's ownership history for unregistered lands, proving a chain of ownership is a good root of title.
Proves the Seller's right to sell the property.
35
What makes a good root of title
1) 15yrs old from date of contract
2) adequate description of property address and plan
3) unbroken chain of ownership - earlier conveyances included in documents
4) conveyances executed as deeds
5) shows stamp duty has been paid
36
What severs co-ownership
Bankruptcy severs and turns a Joint Tenancy into a Tenants in Common ownership
37
Difference between fixture and fitting
Fixture is attached to the land and passes automatically. A fitting is a separate chattel, only passes with the land if listed in the Fitting Content Form at sale of land.
38
2 tests for fixture
1) degree of annexation, if nailed down, screwed and removal damages the structure;
2) purpose of annexation, if it purpose intended to make it permanent, prevails over 1 above.
39
5 categories of legal interest in land
1) mortgage - interest secured by a loan
2) easement - right to use land to benefit another land
3) rent charge - landowner pays periodic rent to rent charge owner/ previous owner
4) profit prendre - someone takes something from land of another- wood/fish
5) right of entry-allows entry under certain circumstances in lease/rent charge
40
Difference between freehold and leasehold estate
Freehold is ownership with indefinite duration.
Leasehold is ownership for a fixed maximum duration.
41
What makes a deed a legal interest
1) in writing
2) states it's a deed
3) signed by grantor in presence of witnesses
4) delivered, dated and sealed
42
What's a covenant
A promise in a contract relating to land
43
What makes a contract of land binding
1) be in writing
2) include all terms agreed by parties
3) signed by all parties
44
What is the difference between a legal interest in unregistered land Vs an equitable interest?
Buyer of land is bound to a legal interest even if not aware.
Buyer is bound to an equitable interest, only if the buyer has notice.
45
How to prove notice to all for equitable interest in unregistered land?
It must be registered on the Land charges Register, this is actual notice and becomes binding on subsequent owners
46
6 classes in the Land Charges Register
C(i) - puisne mortgage, 2nd legal charge
C(iii) - general equitable charge/mortgage
C(iv) - estate contract/option to purchase
D(ii) - restrictive covenant
D(iii) - equitable easement
F - statutory right of occupation of non-owning spouse/ civil partner
47
Adverse possession unregistered land
1) actual, physical and exclusive possession
2) intention to posses
3) at least 12 years
Gives the right to apply for Title at HMLR
48
What are the types of restrictions that can appear on registered title documents?
1. Restrictive covenants
2. Right of way
49
What is a restrictive covenant?
It prohibits or limits development, for example to not use land for commercial purposes or not build another dwelling
50
What is a legal right of way?
A legal right of way is an
1. easement allowing specific individuals or the public to pass over
2. another person's land, typically to access a road, property, or footpath.
3. It is a legally binding, often registered
4. Usually via express deed, long-term use (prescription), or necessity.
51
How can you resolve restrictions on registered title documents?
You can negotiate a Release from the person with the benefit of the right of way or restrictive covenant.
52
In planning permission, what is the definition of a development?
1. Carrying out any building over and under land
2. Making a material change of use of any building or other land
53
In planning permission, what is the definition of 'carrying out a building'?
Making structural changes or additions
54
What are the types of planning permission you can have?
1. Deemed permission - no formal application
2. Express permission - formal application to local authority
55
When is express planning permission required?
1. For any development, you must make a formal application to the local authority
2. Especially for a listed building, need listed building consent
* Permission Not needed for minor internal works
56
When do you have deemed planning permission?
Only for 'permitted developments', you don't need express consent, it's deemed to be granted if build is a:
1. Small home extension
2. Porches or fences
3. Conservatory
57
What is excluded from Deemed permission in planning permission?
Conservation areas excluded, you need express permission for even minor changes, you must make an application for express planning permission
58
What are the types of express planning permission?
1. Outline permission
2. Detailed full permission
59
What is outline permission, as an express planning permission?
1. Broad permission to develop subject to reserved matters (material to be approved by local authority).
2. Must submit detailed full application in 3 years of outline permission being granted.
3. Work must start in 2 yrs of approval of reserved matters.
60
What is detailed full (express) planning permission?
1. Full application to local authority
2. Work must start in 3 yrs of permission granted or it lapses.
61
What is an Enforcement Action?
Local authority can take this action is land owner/ occupier of a property does not have planning permission or fail to comply to conditions.
62
What types of enforcement actions could the court impose?
1. Require full compliance with planning laws
2. Require development to be pulled down
3. Require development to be rebuilt according to planning conditions
63
Why are planning problems an issue?
1. It runs with the property
2. Binds new buyers
64
What's included in an Enforcement Notice?
1. Nature of breach
2. Steps to remedy breach
3. Time limit to complete work
65
What is the penalty for breaching an Enforcement Notice?
1. Unlimited fine
2. Criminal offence
66
What is a remedy for a local authority if there's a breach in an Enforcement action?
Injunction to prevent work called a Stop Notice
67
What is the time limit in England for a local authority to serve an Enforcement Notice for a breach of planning permission or a material change of use?
Local authority has 10 years to serve from the date of the breach.
68
What remedies for Seller if no planning permission?
1. Get retrospective planning permission
2. Take out indemnity insurance at their cost, new policy in Buyers name as a special condition in contract for sale of property
69
What do you need to develop a Listed Building?
1. Listed Building consent from the Local Authority
2. Express Planning permission to change property
70
What is the time limit for Enforcement Action for a Listed Building? Who can be served?
1. No time limit, can be any time.
2. Served to the owner or previous owner.
71
What are Building Regulations?
Statutory standards to ensure new buildings are built accordingly
72
Who needs to comply with Building Regulations?
Anyone who intends to build, like property owners, developers etc.
73
How long does a local authority have to serve an Enforcement Action for a breach in Building Regulations?
In England they have within 10 years of the work that is in breach to serve a notice against the person not complying
74
Is planning permission needed for change of use? What types?
Yes for changes in residential and commercial uses:
1. Dwelling house to multiple occupancy for residential
2. Commercial class change:
E shops, F1 non residential/public, F2 small shops
75
What comes up in a local search?
Indicates:
1. If property is listed
2. Any planning permissions
3. Building regulation completion certificates
4. Enforcement actions
76
Exchange of contract meaning?
1. Contract in writing
2. Legally binding to complete the transaction
3. Can't withdraw without paying compensation
4. Risk for property passes from Seller to Buyer
77
What do solicitors need to do in chain transactions?
1. Ensure both transactions exchanges on the same day
2. Same completion day on both houses for sale and purchase
3. Failure to do so = negligence claim
78
When is the deposit paid?
When contracts exchange, buyer pays deposit, the rest of balance payable on completion.
79
What are the methods of exchange of contract?
1. In person
2. By post
3. By phone, most common
80
What is completion?
1. The day the buyer's solicitor sends the balance of money due to the seller's solicitor to complete the transaction.
2. The date and time specified in the contract, must be 2pm unless amended.
3. The day that the seller moves out and the buyer collects keys from the estate agent and moves in
81
What is a purchase deed?
1. Transfers legal estate in property to a buyer
2. Prepared by Buyer's solicitor
82
What are the 2 types of deeds for sale of land?
1. TR1 for sale of whole land, registered and unregistered land
2. TP1 sale of part of land
83
What does the seller's solicitor need to provide to buyers solicitors at completion? 4 MAKU
1. Account of purchase money on day of completion
2. Amount due in completion
3. Where keys will be available for collection on day of completion
4. Undertaking to pay off mortgage out of sale of proceeds and provide evidence of discharge
84
What are the buyer's solicitor 5 pre completion checks?
1. Official search with priority, registered, 30 working priority period
2. Solvency of Buyer, individual bankruptcy or if company Companies House search if not insolvent
3. Puisne mortgage, 2nd mortgage, class c(i), if unregistered
4. Land charges search, 15 working days priority period, if unregistered
4. Buyers mortgage, clear certificate of title
85
What is the official search with priority?
1. OS1 whole property and OS2 for part of land
2. Checks no recent entries or changes since date in title register
3. Provides buyer 30 working days priority period (new entries are held back, to allow buyer to complete and register)
4. Solicitor negligent if the client suffers a loss
86
What pre-completion searches for Seller?
1. On registered land, if company, Company search to check not insolvent;
Or If individual, if bankrupt.
2. Unregistered land, full land charges search, 15 working days priority period to complete transaction.
87
On unregistered land, what is in a full land charges search?
1. Search full names of current owner for full period of ownership, if anything unexpected
2. Seller to fix issues
3. Gives parties 15 working days to complete transfer
88
Describe the 1st registration requirements for unregistered land?
1. Triggered 1st registration within 2 months of completion for buyer, if not legal estate reverts back to the seller
89
What is a clear certificate of title for the buyers solicitor?
1. Confirms to lender title is good and marketable
2. Acts as the request to release mortgage funds in advance of completion
3. Solicitor must report to the lender any title issues or change in purchase price that affects the loan to buyer
90
What are the 5 parts of a buyers completion statement? PTRDL
Prepared by Buyer's solicitor:
1. Balance of purchase price (deposit paid/mortgage advanced)
2. SDLT/LTT payable
3. HMLR registration fee
4. Disbursement fees
5. Legal fees (must be paid from cleared funds)
91
When's the mortgage deed executed?
1. Dated on completion
2. Executed by borrower just before completion
92
What does the seller check at completion? 4 DFMR
1. Review transfer and arrange execution for deed formalities on or before completion date
2. Complete and return form to buyers solicitor
3. undertake to pay off mortgage and provide evidence of discharge
4. From the lender, obtain the redemption figure for completion
93
What is the redemption figure?
1. In completion, the total amount required to fully pay off a mortgage on a specific date.
2. Lender provides this amount to Seller's solicitor to pay off from proceeds of sale.
3. It includes the remaining principal, interest accrued to date, early repayment charges and admin fees.
94
How to assign a lease? 4 Parts DPCS
1. Buyers solicitor preps purchase deed TR1 to legally transfer lease.
2. Buyer solicitor does pre-completion searches, and
3. provides evidence that landlord consents to assignment.
4. Seller/tenant provides best estimates of service charges and rent
95
Who preps a new lease?
1. Landlords solicitor preps final copies of Lease
2. Original signed by landlord
3. Counterpart signed by Tenant
96
What's involved in a sale of part of land TP1? 4 parts TDEO
1. TP1 must be attached to contract
2. Drafted by sellers solicitor
3. Grants of easements must be included in the Additional Provisions panel
4. Official search (OS2) pre-completion searches gives 30 working priority period to complete
97
What's the method for completion by post? (Presumed default) 5 parts MoneyDateConfirmKeyTime
1. Buyer solicitor send completion money by bank transfer, seller solicitor will confirm funds received.
2. Sellers solicitor completes dates on transfer documents upon receipt of sums
3. Confirmation to buyers solicitor by telephone, fax or email of when completion took place,
4. Seller notifies key holder to release keys to buyer
5.. The latest time is at the end of the working day following the day of completion
98
When does title pass?
1. Registered land, when buyer registers at HMLR
2. Unregistered land, on completion of transfer
99
What is the contractual compensation for delayed completion?
1. Delay by buyer, compensation payable to seller regardless if any loss suffered
2. Delay by sellers, compensation payable to buyer
100
What is a delayed completion?
1.Completion does not take place on contractual date and time,
2. standard time is 2pm, or if not completion takes place next working day.
3. Non-defaulting party may suffer a loss.
101
How do you calculate compensation for delayed completion?
Contractual interest rate is divided by 365 days to find the daily rate.
1. For Seller interest calculated on whole purchase price from contractual date to actual date of completion.
2. Buyer interest calculated on purchase price minus the deposit for period between completion date and actual completion.
102
What is a notice to complete?
1.Innocent party wants to withdraw/terminate contract if party defaults on completion date
2. Must serve notice to complete which makes time of the essence, can be served after completion date passes
3. Creates final date of completion
4. Defaulting parties have 10 working days to complete
103
Remedies for not complying with notice to complete?
1. Buyer defaults: seller may rescind contract, retain deposit, resell property, claim damages.
2. Seller defaults: buyer may rescind contract, reclaim deposit, claim damages.
3. Contract rescinded = no contractual compensation
104
What are the common law damages for delayed completion?
1. Innocent party claim damages through courts on losses flowing from breach of contract plus foreseeable consequential losses.
2. Injured party has duty to mitigate losses.
3. Damages to put innocent party in position if contract had been performed.
105
What is the evidence of a redeemed mortgage?
1. Registered land - Form DS1 sent by lender to seller solicitor, to be sent to buyers solicitor and HMLR
2. Unregistered land - original mortgage deed sent to lender to acknowledge payment, then sent back to seller and then sent to buyers solicitor
106
When do you pay CGT on land transfer?
1. No CGT payable if this property is the individual's main residence
2. Payable if holiday home
3. Payable on any gain (sale price minus acquisition costs)
107
What are the buyer's solicitors post completion actions?
1. Call the buyer to confirm completion took place
2. Followed by written confirmation
3. Remind buyer to put insurance in place on property
4. Notify Lender completion took place
5. If company, register mortgage at Companies House within 21 days, get certificate of registration, copy sent to HMLR
6. Check titles docs, previous mortgage removed, disclose any overriding interests
7. Pay SDLT and LTT within 14 days of completion
8. Register at HMLR within 30 days for registered land, 2 months for unregistered land
108
What is the security of tenure for commercial tenants?
The right of a business tenant to stay in a premises at the end of a tenancy and have a new lease granted to them.
109
What protection in legislation does a commercial tenant have?
1. Landlord and Tenant act 1954 gives them protection at the end of lease.
2. Tenant does not have to vacate unless the landlord uses a statutory method to terminate the lease
3. Gives tenant the right to request a new lease from the landlord.
110
111
What is a hold over?
A commercial tenant who remains beyond the contractual expiry date of their lease is said to hold over.
112
Can a landlord and tenant agree to exclude security of tenure provisions?
Yes, this is known as contracting out.
Landlord can negotiate a higher rent for a protected lease. Tenant can negotiate lower rent for contracted out lease.
113
What are the 3 requirements to contract out a lease?
1. Landlord must serve tenants a Health Warning
2. Tenant must sign a Declaration that they received and understood the Health Warning
3. Reference must be made in the lease, that parties agree to contract out of security of tenure provisions.
114
What is a health warning?
1. Statutory notice explains what security of tenure is
2. Tenant will give up those rights with consequences
3. Should state they should seek professional advice
4. Served in 14 days before tenant completes lease
115
What are 3 ways to terminate a protected tenancy?
1. Landlords sec 25 Notice
2. Tenants sec 26 Request
3. Tenants sec 27 notice
116
What is the landlord's sec 25 Notice?
1. Must be in prescribed form
2. Served 6-12 months before tenancy ends
3. Landlord brings the current lease to an end as they want to either:
a. Get tenant out, hostile s25 notice or
b. End current lease with tenant to charge higher rent, friendly s25 notice
117
What is a hostile sec 25 Notice?
Discretionary Reasons that court will enforce a new lease: tenant has done the following
1. Failure to carry out repairs
2. Persistent delays in paying rent
3. Substantial breach in obligations, or
4. Landlord requires whole property to sublet
118
What are the mandatory grounds for sec 25 Notice? Court will uphold the landlords position.
1. Availability of alternative accommodation
2. Landlord intends to demolish, reconstruct premise and cannot do so with tenant occupation
3. Landlord will occupy the whole building
119
What is a Tenants sec 26 Request?
1. Tenant request a new lease for lower rent or certainty of lease terms
2. Must serve request 6-12 months before new tenancy starts
3. Must use a prescribed form
4. Landlord has 2 months after receipt to serve a counter-notice
120
What is the Tenant's sec 27 notice?
1. No prescribed form
2. Tenant wants to end lease, no renewal
3. Served 3 months before date tenant wishes to leave
121
When is compensation available for commercial tenants?
No fault grounds:
1. Discretionary, landlords needs to sublet
2. Mandatory, landlord intends to demolish, or occupy whole building
3. Tenants have been on premises for 14 years+ (2x eatable value/cost of rent), less than 14 years (1x ratable value)
122
When is compensation not available for commercial tenants?
1. Fault grounds, Discretionary, Tenants failure to carry out repairs, persistent delays in paying rent or substantial obligations
2. No loss suffered if the landlord can offer alternative accommodation to tenant
123
What is interim rent?
Until new lease signed, tenant pays the old rent. If New lease to be granted by the landlord, it can be at market rent. If landlord not willing to issue new lease, rent will be 10-15% below market rent.
124
What are 2 common types of mortgage?
1. Repayment mortgage
2. Interest only mortgage
125
What is a repayment mortgage?
A repayment mortgage (or capital and interest mortgage) is a loan where monthly payments cover both the interest accrued and a portion of the original loan amount (capital). As long as all payments are made, the debt reduces over time and is fully repaid at the end of the term.
126
What is an interest only mortgage?An interest-only mortgage is a loan where monthly payments cover only the interest charges, not the principal (capital) borrowed. This results in lower monthly payments but requires repaying the full original loan amount as a lump sum at the end of the term.
SQE2
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Decks in class (9)
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