Attributes of Land:
Land is:
Immovable;
Includes what is above and below (as well as the surface); and
Includes anything permanently fixed onto it.
‘”Land” is both the physical asset and the rights the owner or others may enjoy in or over it.’ [1]
Physical and Temporal Divisibility:
Land is physically and temporally divisible.
A person can transfer part of the land they own to another, making it 2 pieces of land. This is physical divisibility (freehold).
Alternatively, a person could transfer a slice of time in the land to another. This is temporal divisibility (leasehold).
Rights in Land:
Land law is primarily concerned with the different rights and duties that people can have over land.
Ownership:
Owning land is when a party holds the major stake in a bundle of rights existing over the land. They do not need to hold all the rights to be considered the owner.
All land in England and Wales is actually ultimately owned by the Crown. Persons may merely own an ‘estate’ in land, which confers rights to use and control it. This is practically equivalent to ownership.
Estates:
Unlike in everyday life, when you own land, land law treats you as the title holder. The title holder does not own the land itself, but the estate which grants them rights for a period / slice of time.
Rights in rem (real / proprietary / thing related) and in personam (personal):
Rights in rem: the rights of the title holder to the property itself (estates).
Rights in personam: a contract (known as a ‘licence’) to use or be present on land for a fixed term without being considered a trespasser. This is a right against the person holding the title.
The doctrine of nemo dat means that someone cannot grant a bigger estate in land than they already own. They can grant a smaller one (divisibility).
Freehold Estates:
Also known as fee simple absolute in possession, freehold estates are the largest possible in English land law.
Freehold titles are perpetual, meaning land ownership does not end on a fixed date and is freely transferable (alienable).
There can only be 1 freehold estate on a plot of land.
Leasehold Estates:
Also known as terms of years absolute, leasehold estates are created when the freeholder of an estate grants another the right to use the land for a fixed period.
This period may be subject to renewal upon negotiations.
For the period of the lease, both a freehold estate and a leasehold estate exist alongside one another. The freehold estate is the larger estate.
If the freehold estate terminates before the end of the leasehold period, the lease also terminates.
Leaseholders may carve out of their leasehold estate another, shorter leasehold estate (sub-letting).
A person who acquires an estate in land is known as a disponee (or transferee).
Law of Property Act 1925 (now controlled by Land Registration Act 2002):
s1(1) – legislated the doctrine of estates out of law; the only forms of estates could then be freehold or leasehold.
Numerus clausus: citizens are not free to devise their own types of property rights. Instead, there is a limited range of permissible estates and interests, as controlled by Parliament and the Courts.
Doctrine of Estates:
Prior to 1926, holders of freehold estates could, and did, create various other types of estates in their land. These usually were leases without a fixed end date.
EG: life estates.
The main reason of this doctrine was to keep an estate within families. It was not suited to geographical mobility and industrialisation (people couldn’t buy elsewhere as their property was tied up), so there was increasing pressure to abolish it.
s52 – freehold and leasehold estates that are transferred to another must be legally recognised, normally by deed.
Land Registration and Deeds:
A deed: a document titled ‘deed’, signed by both parties and witnessed by another. [2]
Although it is not strictly necessary, usually a contract of sale is drawn up and signed when land is to be sold. When the deed is transferred, the contract is said to ‘merge with the grant’, meaning that it has no separate legal existence from the deed itself.
Most legal estates also have to be registered on the Land Register. Once land is registered, it is known as a registered disposition and ownership is guaranteed.
If a transfer of land is not done via deed and registration where it ought to be, the right will change from a legal right in rem to an equitable right in rem.
Leases Exempt from Registration:
Leases less than 7 years.
Leases for more than 3 years but less than 7 years can optionally be registered.
Leases shorter than 3 years cannot be registered and do not have to be created by deed.
Where a lease cannot be registered, this counts as an ‘overriding interest’. [3]
Purpose of the Deeds and the Registration Requirement:
Rights must be easily provable due to the value of the land. This is not particularly convincing since there are other forms of property that may be more valuable than land.
It is more likely that deeds and registration is required because the land is immovable.
They also allow easy distinction between legal ownership rights and general interests.
Interests:
Interests are rights over property that don’t amount to ownership. Someone with an interest in land does not have an estate in the land.
Examples of Interests:
Right of way.
Requirements / covenants.
Option to purchase.
Entitlement to value of the estate (beneficial / equitable entitlement).
Detrimental reliance on a promise made by an owner.
For the land market to work it is important that title holders must allow interests in their estate, but also ensure their title is not vulnerable to those interests.
Rights in rem (real / proprietary / thing related) and in personam (personal):
Interests in land may be purely in personam (contractual in nature), but they are usually in rem.
Interests in rem may be binding on third parties involved with the land (including potential purchasers).
Legal Rights in rem:
A common law ‘legal’ right, binds everybody.
Legal estates, both freehold and leaseholds, are legal rights in rem. Due to this, these interests are passed onto successive owners.
Acquirement:
Some interests become legal rights in rem only if something is done. Usually, this is registration on the Land Register.
Some interests become legal rights in rem due to the passage of time (prescription).
Some interests become legal rights in rem automatically.
Registration:
Typically, a Notice on the Register is given to the Land Registry. This is basically a warning to any future party that another already has an interest in it. [4]
Once a Notice is Registered, it is binding on any future disponee.
Equitable Rights in rem:
Where someone, who would’ve had a legal right in rem if it were registered, has an interest, they have equitable rights.
Land Registration Act 2002:
Prior to 2002, an equitable right in rem bound everyone except from a ‘bona fide purchaser for value without notice’. The new rules simplify this.
s29 - Special Priority Rule: Under the new law, if a registerable equitable interest in rem is not registered, then it will not bind a disponee for value (buyer). Notice and knowledge of the unregistered interest is irrelevant.
s28 - Basic Priority Rule: if someone who acquires the land by other means than sale, or provides only nominal consideration, the interest is likely to be binding, even if unregistered. Whoever held the right first has priority.
Resources:
References:
[1] Dixon, Modern Land Law (12th edn, Routledge 2021) 4 [2] Law of Property (Miscellaneous Provisions) Act 1989 s1 [3] Land Registration Act 2002, Schedule 3 para 1 [4] Land Registration Act 2002 s32
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