Thorne was the trustee holding the property for the couple. Rose therefore, has overriding interests in the property, ‘these interests bind anyone taking under a registered disposition including a purchaser…’ she has an interest in the property and was also seen to be in possession at the time of the sale even though not she was not in the country. The case of Chhokar v Chhokar suggests that it need not matter if there is a brief period where the owner is away from the property.
These rights were previously stated in S.70 (1) (g) LRA, which looked at whether the purchaser is in actual occupation and ‘has right in the property’. Under schedule 3 paragraph 2 of the LRA the reasonable discoverability test is applied. Two criteria’s must be satisfied in order for an overriding interest to succeed these are that ‘i) if a purchaser knows of an interest but it is not seen to be obvious on an inspection or ii) if the purchaser could have found the interest out by reasonable inspection and did not know of it’.
There must be actual occupation as supported by the case of Williams & Glyn’s Bank v Boland which clarified that the wife of the sole proprietor could have an equitable interest and could be successful in her claim. Hence, Rose has an interest which is binding.
These interests are now under the LRA. This is also seen to be an equitable interest under a resulting trust. This can occur where there is a couple involved and both have contributed towards the costs. Although Rose is not registered, Major Thorn is holding it on trust for them both and this does not have to be registered to be enforceable. Therefore, Major Thorn is holding half of the property on trust for Rose. This means that she would be entitled to half of the proceeds of the sale price.
With regards to Mr Wood, he can be seen to have a legal interest. His contract can be seen as an example of an estate contract. As the lease is under 7 years it is possible to have an overriding interest in the cottage. These interests were originally governed under Section 70 of the LRA.
However, under schedule 3 paragraph 2 of the LRA the person must be in ‘actual occupation’ for the interest to apply as supported by the case of Webb v Pollmount Ltd. Mr Wood is not in occupation of the cottage, if perhaps he had occupied the cottage for a brief period during the lease then he may have a stronger argument as to being granted a first refusal. In order for his claim to be successful it must have been protected by notice on the land charges register.
The focus now must turn to whether Mr Plant has a right of way over the field. It must be established whether it will be enforceable upon Mr Hay’s Land. Schedule 3, Paragraph 3 of the LRA looks at whether the easement is legal. The following must be considered: ‘ ‘the purchaser has actual knowledge of it,’ ‘it is obvious on a reasonably careful inspection of the land…’ and ‘it has been exercised within the period of one year before disposition’.’ Therefore this right of way it is possibly binding even though Mr Hay is unaware of it has been exercised within the period of a year and existed for a number of years, therefore will be binding.
With regards to the ornament and its plinth, the issue lies in whether they are a fixture or chattel. Under S.205 of the Law of Property Act it deals with fixtures and chattels. It must be looked at whether the ornament is part of the garden or if it is there for decoration purposes. A chattel can become a fixture and formulate part of the land, if it is attached to it.
If it can be seen that the ornament is part of the realty then it has been illegally removed. The case of Holland v Hodgson first established what is meant by fixtures and chattels. It will be considered whether it is a fixture, using a two fold test. Firstly the degree of annexation test must be used. This test focuses on the specific item to see how it is connected to the property. The case of Hamp v Bygrave looked at items resting on their own weight, and it was suggested that ‘only in the case of the Chinese figure was the plinth fixed or attached…’
Following this approach, the purpose of annexation test is applied. It focuses upon the reason that the item is placed there. It was regarded in the case of D’Eyncourt V Gregory that statues are fixtures where ‘ …they had become part of the garden itself’.
The case of Berkley v Poulett also focused on a similar issue to the situation in hand with regard to a statue and a plinth. However, Scarman LJ established that a statue is not a fixture where ‘…they had never formed part of the architectural design.’ He went on to say that the plinth had been used for the purpose of a fixture. Therefore the plinth may be retrievable as it is a fixture, but the statue is a chattel. Under S.62 (4) of the Law of Property Act he could have expressed his intention to keep the item which would have meant that it was free for him to remove.
With regards to Mr Corn’s issues, it must be looked at as to whether any of the third parties have legal or equitable interests in the land which will be enough to bind him. The S.1 (2) of the LPA looks at legal interests and S.1 (3) focuses on equitable interests. A legal interest is binding and can be seen to be ‘good against the world’, whoever purchases the land will therefore, be bound by any interests within it. Equitable interests are ‘rights which are good against all persons save the bona fide purchaser…’ so if a purchaser has bought the property in good faith they will not be bound by such an equitable interest this is known as equity’s darling.
Firstly it can be established that Mr Potter’s right is equitable and it can be classed as a commercial interest. It must be established that Mr Corn has a good ‘root of title’ to the land this was set out under S.23 of the LPA It must, be considered whether this interest is binding upon Mr Corn. Under S.198 (1) of the LRA it looks at whether the commercial interest has been registered. If it clearly has been registered under Class D (ii) of the Land charges register, under the Land Charges Act then it will be binding upon the purchaser.
The case of Pilcher v Rawlins deals with a bona fide purchaser where an actual notice is not obtained, they will not be bound by the interest. Therefore, if the interests are not registered they cannot be binding upon Mr Corn unless he has specific notice of it. It can be argued that the original covenant was made between Mr Potter and Farmer Field therefore, as it is a restrictive covenant Mr Potter may be able to bring an action for damages against Farmer Field for a breach of contract.
With regards to Mr Leek and Mr Roots tenancy agreements, they happen to be legal interests and therefore Mr Corn will be bound by them. Mr Leeks lease could have been created orally or written however, Mr Root must have a deed for his. It can be argued that the leases are for a fixed period and therefore must be honoured unless agreed to be terminated at the end of it. It can also be argued that as there was a reasonable inspection by Mr Corn, He could have come across the leaseholders on his tour of the ground therefore it would be binding upon him.
With regards to Heather’s right of way, it can be argued that as it can be seen to be a Legal interest therefore, any purchaser of land will be bound by the right of way. As she has made a payment, it can be argued that this was beneficial to Mr Field as he was receiving a benefit of the money. However, seemingly it does not benefit Mr Corn as he is not getting anything from it and therefore it should not be binding upon him unless a similar payment is made to him.
Daisy is a beneficiary her interest is one of a residual nature as there is only one trustee present. It can be argued that perhaps. Daisy may be protected by constructive notice the rule in the case of Hunt v Luck is suggesting that if there has not been a reasonable inspection by a purchaser to see whether or not there are any persons with interest in land, these interests may be protected by a constructive notice. This suggests that Daisy’s rights could be protected. However, as Mr Corn is seen to be a Bona fide purchaser, it can be argued that he has bought the property in good faith and therefore if he is not aware of such interests, unless he has totally ignored them as in the case of Barclays Bank PLC v O’Brien otherwise he should not be bound by them.
- Mackenzie J-A , Phillips. M, Textbook on Land Law, 12th ed, 2008, oxford university press.
- Curzon L.B, Richards P.H, The Longman Dictionary of Law, 7th ed, 2007, Pearson/Longman.
- Bray. J, Unlocking Land Law 2nd Ed, 2007, Hodder Arnold.
- Clarke. S, Greer. S, Land Law Directions, 1st ed, 2008, Oxford University Press.
- Smith.R, Property Law Cases and Materials, 3rd ed, 2006, Pearson/ Longman.
- Gray.K , Gray. S, Elements of Land Law, 4th ed, 2005, Oxford University Press.
- http://www.kevinboone.com/lawglos_ActualOccupation.html (7/11/08)
- http://books.google.co.uk/books?id=zXSKtLp7muEC&pg=PA15&lpg=PA15&dq=residiual+interests+land+law&source=web&ots=OtUmM9D7c2&sig=aqBX0-qV09wPoBbrklxPYHB5XN0&hl=en&sa=X&oi=book_result&resnum=2&ct=result#PPA16,M1 (11/11/08)
- http://www.kevinboone.com/lawglos_EstateContract.html (15/11/08)
- http://www.gillhams.com/dictionary/324.cfm (15/11/08)
- http://www.landregistry.gov.uk/ (15/11/08)
- http://www.oup.com/uk/orc/bin/9780199284436/resources/cases_materials/bychapter/chap_10.pdf (15/11/08)