Registration

Question 1

Overreaching

Answer 1

• overreaching is a mechanism, primarily defined in Section 2 of the Law of Property Act 1925, that allows a purchaser to buy land free of certain equitable interests (beneficial interests of trust beneficiaries)
• This is achieved by the purchase price being paid to two trustees, effectively transferring the beneficial interests from the land to the proceeds of the sale

Question 2

What is the Land Registry?
Where is it defined?

Answer 2

• LRA
• a centralised system in which an individual can find all reliable information pertaining to ownership & interests over registered title

Question 3

What is the key principle of nemo dat?
which case?

Answer 3

• Nemo dat: no one can give a title they do not have
• Bishopsgate Motor Finance Corp Ltd v Transport Brakes Ltd

Question 4

What are the principles of the registry?
academic?

Answer 4

• Ruoff
• mirror principle
• curtain principle
• insurance principle

Question 5

What is the mirror principle

Ruoff 1957

Answer 5

• Land Registry ought to reflect reality accurately
• properly reflect the basic needs of who owns said property, as well as who may have a legal / equitable interest in said property

Question 6

What is the curtain principle?

Answer 6

• a purchaser need only be concerned with the legal title reflected on the register and not with any underlying equitable interests
• The register of title acts as a “curtain” that hides the true equitable position of the land
• Purchasers are not required to inquire about or be aware of any equitable interests behind the legal title
• Simplifies Transactions
• Promotes Certainty
• Protects Registered Proprietors
• The principle of overreaching ensures that equitable interests are dealt with effectively and that the purchaser’s title remains valid, even if there are underlying equitable interests.

Question 7

What is the insurance principle?

Answer 7

• interests and rights on register are protected by state
• mistakes will allow for compensation
• State is incentivised to take good care to make sure Register is accurate and reliable

Question 8

What are owner’s powers?
where are they found?

Answer 8

• s.23 LRA
  -> registered proprietors can deal with the land as if they held the legal estate e.g. transfer, mortgage, lease
• s.24 LRA 2002
  -> person entitled to be registered has same powers as a registered owner -> acquired land that is not yet registered

Question 9

Where are registrable interests found?

Answer 9

• s.27 LRA
• which estates need to be registered

Question 10

Which sections cover priorities?

Answer 10

• s.28 LRA 2002
• s.29-30
• s.116
• Sch 3

Question 11

Which sections cover notices?

Answer 11

• s.32-33 LRA
• gives priority but doesn’t guarantee validity

Question 12

Which sections address restrictions?

Answer 12

• s.40-41 LRA
• something that prevents owner from doing something
• e.g. bank lending money on mortgage doesn’t allow mortgagee to sell land

Question 13

Which section gives you title by registration?

Answer 13

• s.58
• most imporatnt one
• it gives you the legal title whether or not you should have it

Question 14

Which section discusses timing and registration gap?

Answer 14

• s.72, 74 LRA

Question 15

Which section discusses alteration + rectification?

Answer 15

• s.65
• Sch 4

Question 16

Which section discusses indemnity?

Answer 16

• s.103
• Sch 8

Question 17

What did the Law Commission say about updating the LRA?

Answer 17

• land registration doesn’t exist in a vacuum
• LRA was never inteded to be a self-contained legal ‘code’ for land registration
• precise relationship between LRA and general law is a source of debate

Question 18

What did Cooke say about the LRA?

Answer 18

• e-conveyancing made LRA politically attractive allowing it to be transported through Parliament

Question 19

Registrable interests

Answer 19

S.27
- Requires certain interests in land to be registered to take legal effect
- Transactions requiring registration include=
-> Transfers of freehold or leasehold estates
-> Leases over 7 years
-> Legal mortgages
- If interest not registered under s.27= not legal interest, maybe exists in equity
- Case= Barclays Bank v Zaroovabli (1997] where it was held that a legal mortgage must be registered in order to take legal effect. Unregistered= equitable status= Lower priority

Question 20

Priorities

s.28 & 29

Answer 20

• S.28- Basic rule of priority= interests take effect in order they are created (first in time)
• Abbey National Building Society (1991) where it was held that a registered mortgage had priority over mother’s equitable interest as it was made first in time
• S.29- Effect of registration of a deposition= A purchaser for valuable consideration takes priority over unprotected interests (unless protected by registration or sch3)
• Law Commision on s.29= ‘A fundamental protection for purchasers’
• Halifax v Curry Popeck (2008)= under s.29 a bona fide purchaser for value w/out notice takes priority (ignoring rectification for fraud)

Question 21

Priorities

s. 30 / 116 / sch 3

Answer 21

• S.30- Legal charges and mortgages= Same priority rules apply to mortgages- a lender w/ a registered mortgage has priority
• S.116- Equitable interests= Some equitable rights (eg. PE claims) are enforceable even if not registered
• Sch3- Overriding interests= Certain rights bind purchasers w/out registration including leasehold estates under 7 years and rights of actual occupation
• Gray (2008)- overriding interests leads to ‘uncertainty’ for lenders and 3rd parties
• Williams and Glyn’s Bank v Boland (1981)- bank bound to wife’s rights as she was in physical occupation of property

Question 22

Notices

s.32 / 33

Answer 22

• S.32- For notices used to protect 3rd party interests such as freehold covenants= a notice does not confirm validity but ensures the interest is binding on future purchasers
• S.33- For interests that cannot be protected by notices= Trusts and leases under 3yrs cannot be registered as notices (protected by restrictions)
• Malory Enterprises v Chesire Homes (2002)
  -> Company claimed interest in land but title fraudulently transferred
  -> Held that equitable rights should be protected by notice or registration under s.32

Question 23

Restrictions

s.40 / 41

Answer 23

• S.40- Nature of restrictions= Restrictions prevent certain delaings unless conditions met (eg. consent from 3rd parties or court may be needed)
• Bogusz (2010)- used not to protect rights but as strategy to block transactions
• s.41= If restriction is registered, any dealing not complying w/ it may be void or not registerable
• Hunt v Luck (1902)
  -> Landlord attempted to sell property w/out notifying tenants who has an unregistered lease
  -> Held that a restriction would have prevented this transaction had it been registered

Question 24

Title by registration

s.58

Answer 24

• Conclusive Title rule- Dixon (2018) describes it as the “central pillar” of registration
• Registration as proprietor gives indefeasible title
• Even if title obtained by fraud, the registered owner remains the owner in law (Subject to rectification)
• Ruoff and Roper (2018)- claim s.58 leads to “injustice” in fraud cases
  Walker v Burton (2013)
  Family was wrongly registered as proprietors of common land
  S.58 provides conclusive proof of ownership- 3rd parties still bound- rectification still possible

Question 25

Timing and Registration Gap ## Footnote s. 72 / 74

Answer 25

- S.72- Protection during registration gap after transaction= Transferee’s interest protected during this period - S.74- Duty of HM Land Registry= Registry must verify applications to ensure they comply w/legal requirements - Dixon (2014) claims this problem is reduced with instantaneous communication

Question 26

Alteration and Rectification ## Footnote s.65 / Sch 4

Answer 26

- S.65- Allows for rectification of register - Sch4- The register can be altered to correct mistakes= If rectification causes loss, compensation is available - Law Commision (2016) on sch4- “Necessary corrective mechanism” in order to balance certainty with fairness - In NRAM Ltd v Evans (2017) Kitchin LJ defines ‘mistakes’ as: -> “Widely interpreted and not confined to any particular kind of mistake”

Question 27

Indemnity ## Footnote s. 103 / sch 8

Answer 27

- s.103= Sets out the right to indemnity where rectification causes loss - sch8= Provides compensation to parties who suffer loss due to an error or rectification - Ruoff and Roper (2018) criticise indemnity as payments given are often less than actual market loss suffered