True/False Quiz

Answer the questions below based on the facts of this short scenario. In 1984 A purchased the freehold of No. 1 Main Street from BEF. In 1986 A discovered that B's predecessor in title, C, who had purchased their interest in the house in 1965, had not in fact purchased their interest from a freehold owner. In addition, A has now discovered that D claims to have entered into a contract giving him the option to purchase No. 1 Main Street with B in 1982. A did not know about this when he bought the property. He had done a search of the Land Charges Register under the name of BFF which stated that there was no interest binding B's interest. A search under BEF has revealed no registration of D's interest either. In fact, the interest is registered under BEE. In 1987 A declared that he would hold the property on trust for G and H, his children. He sold the property in 1989 to J for a good price. J knew about G and H's interests but will not let them live in the house. D still wishes to buy the house. A warned J of D's interest and so J, being careful, ran a check on the land charges register for BEF, as well as against A's name, which did not reveal any interests. A few days after D ran this check, A entered into a contract to grant a ten year lease to K, but did not in fact create any deed. K entered his interest under this contract on the land charges register.

Statute Quiz

Here you should outline the main effect, role, etc. of the provisions below. This is designed as a guide to the most important provisions, and as a means to improve your recall of the statutory provisions.

Case Law Quiz

Here you should attempt in one or two sentences to outline the main points to be taken from these cases and also three or four key words with their subject matter. This should assist in revision.

Short Answer Questions

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Podcast Script

This podcast examines the mechanisms for registration of interest in unregistered land.

In the previous podcast in this series we considered the rules relating to registered land. In particular we looked at sections 28 & 29 of the LRA 2002 and the requirement of registration. In this podcast we will be considering unregistered land and in particular we will look at the land charges system. When looking at unregistered land, it is often useful to think about the registered land system to compare them.

The unregistered land system will eventually it seems become obsolete. To date, about 90% of land in the UK is registered and with compulsory registration in place this figure will increase. The advent of e-conveyancing under section 93 Land Registration Act 2002 will also affect this. It may still on occasion though be necessary to consider the rules for unregistered land. These rules, unlike the 2002 system, do not rely on registered title. That is the key difference. But there is a register that forms a critical part of the system- the land charges register. This is a register of third party interests in land and the rules relating to this register can be found in the Land Charges Act 1972. We will be considering the sorts of interests that should be registered as land charges, the process of registration and searching the register, and finally the effect of such registration.

(1) What sorts of interests should be registered as land charges?

The first thing to remember is that in the case of unregistered land only equitable interests need be registered. Legal interests (with the exception of the puisne mortgage) bind automatically. In addition not all equitable rights are registrable as land charges and instead will either be overreached where appropriate or may bind by virtue of the old doctrine of notice. We will not go into these mechanisms here but it is important to remember that the land charges system is by no means a comprehensive system of registration even as far as equitable interests are concerned.

Section 2 of the 1972 Act defines the 6 classes of land charge and you should familiarise yourself with these. Remember, when answering problem questions it is important to be specific so you will want to make clear exactly which statutory provision renders the interests you are considering registrable. Some of the most important can be found in Class C- class C(iv) for example is concerned with estate contracts such as equitable leases. Options to purchase and rights of pre-emption are also contained within this Class. Class D(ii) is concerned with registered freehold covenants.

(2) The mechanics of registration as a land charge

The land charges register uses a system of registration by name where interests are registered against the name of the estate owner. This means that when searching the register a purchaser must search for the name of the current and previous estate owners. As you can imagine, this can cause a lot of practical difficulties. In particular, a purchaser will be detrimentally affected if he does not search against the correct name. This is because although the official search report will be conclusive, it will only protect a purchaser if he has searched for the correct name, postcode etc.

A further potential problem relates to the timing of searches. Often a purchaser will not have access to the title deeds- and thus to the name of previous owners- until a sale has been agreed. As a result section 24(1) gives the purchaser an escape route if he did not in fact know of a land charge which was later revealed to him following a search. In addition, section 11(5) gives the purchaser 15 days from his official search to complete the purchase. During this ‘priority period’ any interest which is entered as land charges will not bind him.

(3) The effect of registration

Section 11(5) apart, the fact of registration of an interest as a land charge means that the purchaser will be bound by that interest as long as the interest is registered against the correct name. The Land Charges Act deems registration to be constitutive of actual notice and means the interest is binding whether or not the purchaser in fact knew about it. Where an interest is registrable, entry as a land charge is in fact the only way to ensure that it binds a purchaser.

The process of registration of land charges therefore has crucial consequences in the case of unregistered land.

In the next podcast we will consider co-ownership interests in land. Today’s key concept- land charges.