Land Law

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  • Topic: Land Registration Act 2002, Law, Property law
  • Pages : 9 (3359 words )
  • Download(s) : 35
  • Published : February 21, 2013
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This assignment will discuss some of the interests which can exist in land, and how they can affect a third party who wishes to purchase the property. By considering the creation of such interests, it can be assessed how they are protected against third parties in the registered system and then consider how the protection differs in the unregistered system. Richard has entered into a written agreement to purchase a freehold estate from Vanessa. He has been informed about the interests relating to the estate. When advising Richard whether he is bound to the interests, it is important to identify all the interests and establish whether they are binding. There are three types of propriety rights which can exist at law; they are property rights, personal rights and equitable property rights. The first interest to consider is the lease given to Simon. To establish whether Richard will take subject to the interests one would need to consider whether the interest is capable of being legal. A lease has the potential of being created at law, as it is one of the two legal estates listed under s.1 (1) (b) Law of Property Act 1925, as a term of years absolute. The next question would be to consider whether it was created in the correct manner complying with the formalities of creating a legal estate. As per s.52 (1) of the LPA legal leases over 3 years must be created by using a deed, only then it is capable of being recognised in law. Another requirement would be that some leases will only be classed as legal leases if they have been registered with the land register. There are different categories of leases, depending on the requirements which are needed to be fulfilled when creating them at law. The first types of leases are those shorter than three years, the second type of leases are those which are longer than 3 years but less than 7 years. As the lease was created in 1990, it has already been 20 years and so the lease does not fall within these categories. The final category of leases is a lease for more than seven years. These leases are required to be created using a deed in accordance to the LPA; it also requires that the lease is registered to be legal under s. 27 (1) and (2) of the LRA 2002.Previously under the LRA 1925, leases less than 21 years were not required to be registered; however this has been reduced to 7 years under LRA 2002.If the lease has been created using a deed but not registered there would not be a lease created at law. The lease in question may require registration due to the fact that the lease was created in 1990; where registration was only required if the lease was over 21 years. The lease has already ran for 20 years, if it is to continue, then the lease is for longer than 21 years and would be required to be registered, however if the lease runs out within the next few months, it may not be required to be registered. If the lease is created using a deed then the requirements of the LPA have been fulfilled, and so the lease would be created at law as long as the requirements of registration are completed. If no deed has been used then there would not be a lease created at law but a lease in equity. Furthermore failure to register could also render the lease invalid at law. The equitable lease would need to be registered as a notice as per s. 34 of the LRA 2002 for it to be binding over Richard. An equitable interest binds everyone except a bone fide purchaser of value without notice; a way to bind a third party would be by providing a notice. As Richard has been informed about the lease, it could be taken as giving Richard actual notice, thus excluding him from the exception of being a bone fide purchaser without notice. Where an equitable lease arises due to the failure to use a deed renders the lease incapable of being registered as a notice, ultimately releasing the third party from being bound to the lease. In such cases if Simon was occupying the property before the property was...
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