Types of Ownership: Overview

[Flash Card 1 of 3]

Estates

• life estate: freehold / common law person could hold land for lifetime / on death property reverts back to owner of fee simple
• fee simple: freehold & largest estate in land / estate in land capable of being inherited & may pass to heirs / can last indefinitely (until landowner has no heirs) / qualified fee simple: conditional or determinable / fee simple absolute: no conditions
• fee tail: freehold / restrict class of heirs / grantor retains portion of fee simple / unable to create today
• leasehold estates: fees simple owner allow possession of land for rent

Tenures

• freehold: estate in land / indefinite time
• leasehold: estate in land / from freeholder / set time

Successive interests

• possession: if person has immediate enjoyment of it (physical possession or receipt of rent) (s.205(1)(xix) LPA 1925) / life estate is interest in possession
• reversion: interest that is not disposed of following the granting of an estate / if A gives B life interest in property: A retains interest in reversion / if A grants B a lease: A retains a freehold reversion
• remainder: if original owner gives up entire estate in more than one portion / A give lifetime estate to son & fee simple to grandson / A kept no reversion / future interest is remainder / son gains lifetime estate & grandson gain remainder (fee simple) on death of son

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Types of Ownership: Overview

[Flash Card 2 of 3]

Contribution of equity

• owner of land may transfer land to trustee (T) to the use of or on trust for a beneficiary (B) / equity not allow T act unconscionably / B own equitable interests in land / T legal owners (common practice 2 Ts)
• if Ts sell: B's equitable interest dealt with under bona fide purchaser rule & overreaching

The bona fide purchaser rule

• unregistered land: purchaser must ensure appropriate enquiries carried out / before exchanging contracts / avoid being bound by adverse third party interests
• bona fide purchaser: acquired unregistered land / for value / without notice of an equitable right / position supported by equity purchaser includes mortgagee / mortgagee not made all reasonable enquiries / constructive notice of equitable interest / not claim under bona fide purchaser rule (Kingsnorth Finance v Tizard)
• also applies to personalty / constructive notice only if commercial purchaser knew facts / imperative to seek explanation / if absence explanation / obvious transaction probably improper (Macmillan v Bishopsgate Investment Trust)
• registered land: bona fide purchaser rule not apply

Overreaching

• transfer of rights under a trust from land to the proceeds of sale of land
• if purchaser has notice of equitable interests: not bone fide purchaser / must use overreaching to be free of equitable interests
• to overreach: must be minimum of 2 Ts / value paid for property must be paid to all Ts / receipt must be given
• equitable interest / transfers to sum of money held by Ts / Ts obliged to distribute or invest / as detailed by trust

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Types of Ownership: Overview

[Flash Card 3 of 3]

Property legislation 1925

• pre-1925 fragmented: Ts hold legal estate & Bs equitable interest (horizontal split) / X for life Y in fee tail & Z in fee simple (vertical split) / successive splits / reform needed: smaller estates / life interest & fee tail as equity behind trust

Law of Property Act (LPA) 1925

• s.1(1) : only legal estates capable of existing: (a) estate in fee simple absolute in possession / (b) term of years absolute (lease)
• s.1(2): only interests in land capable of existing: (a) easement (equivalent to fee simple absolute in possession or term of years absolute) / (b) rentcharge in possession (perpetual or term of years absolute) / (c) charge by way of legal mortgage / (d) any other similar charge not created by an instrument / (e) rights of entry (legal term of years absolute or annexed to legal rentcharge)
• s.1(3): all estates & interests / other than listed in s.1(1) & s.1(2) / are equitable
• valid equitable interest if: not listed in s.1(1) or s.1(2) or listed but conditions not satisfied / & correct form used to create the right
• legal interest if: listed in s.1(1) or s.1(2) / conditions satisfied / & correct form used to create the right
• no legal or equitable interest if: not listed in s.1(1) or s.1(2) or listed but conditions not satisfied / & incorrect form used to create the right

Family Law Act 1996 amended by Civil Partnership Act 2004

• s.30(1): (a) if one spouse or civil partner (A) entitled to occupy house through (i) beneficial estate or interest or contract / (ii) enactment giving A right to remain in occupation / & (b) other (B) not
• s.30(2): B's home rights / (a) if in occupation: not evicted or excluded by A except by court order / (b) if not in occupation: right if court order given to enter & occupy

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