Equitable Interests and Land Law

1. In Tulk v Moxhay, a new equitable interest in land was created for the protection of landowners in the form of restrictive covenant, which would bind a purchaser of the land even though not a party to the covenant to an obligation to not perform certain acts of ownership upon the land. This principle provides that restrictive covenants can run with the land. The principle is of declining significance since the introduction of the Land Registration Act 1925, under which such covenants have become a registrable interest.

2. In order to be a tenant under a lease, exclusive use of possession for a fixed or periodic term in return for a consideration of lump sum or periodical payments are the conditions to be met. In case there is a Licence Agreement, the licensee has use the property as per the terms without the creation of any other interests. In case Licence Agreement is contractual in nature, terms of the contract are applicable. As Giles and Jan do not have exclusive possession and the landlord can increase the number of tenants, this is not a lease but a license. He can therefore increase the number of tenants as per the terms of the agreement. Giles and Jan can take action for enforcement of the clause which requires the landlord to provide cleaning services as per the Agreement.

3. The rights that are eligible to easement include right of way, easements of support, easements of light and air, rights to use service conduits, and right to artificial waterways, to name the prominent easement rights. The characteristics of rights that can be eligible to easements were noted by the court in Re Ellenborough Park. According to this, there are four characteristics of easements: dominant and servient tenement; right connected with enjoyment and benefit of servient tenement; dominant and servient owners are different; rights are capable of forming the subject-matter of a grant. Easement rights can be created through implication. This can happen in specific situations. One of these is if an owner of property sells part of property to another while retaining another part of the same property, although this may not always lead to creation of easement rights. Implied grants can lead to creation of easements, such as, where rights were first granted under licences and were later held to be legally transformed into an easement.

4. English law strives for a balance between the rights of borrowers and lenders on default of legal mortgage. The need for a balance arises because conflicting interests are created with relation to the same parcel of land between landowner and lender when the land becomes a subject of legal mortgage. The courts try to resolve these tensions by recognising commercial realities of mortgage, rights of vulnerable parties (especially third parties who are not parties to the mortgage agreement). Courts have recognised the mortgagee’s right to possession on default of loan to be the same as the rights of the lessee. In cases where the mortgagor inhabits the house, court may adjourn repossession so as to provide more time to the mortgagor to make payments and avoid possession or sale of house by mortgagor. In cases where manifestly disadvantageous transaction is considered to have taken place, the court may require notice to co-mortgagor, especially those in vulnerable positions. To a great extent, conflicts and tensions running through land law in this context has been resolved through the Etridge procedure, which provides a fair balance between the interests of borrowers and lenders. This requires steps to be taken by lender to ensure avoidance of undue influence (especially if co-mortgagor is wife): direct communication with the wife and written confirmation from a solicitor acting for her; provision of financial information to the solicitor of the co-borrower; and written communication from solicitor on the advice given by them.

5. Dodger can enforce the arrangement under proprietary estoppel. In order to do so, Dodger will have to prove: representation of assurance from Oliver, reliance on the assurance by himself and detriment to himself. These can be easily established as Oliver made specific statements to Dodger regarding the latter’s interest in the land, Dodger left his job in the city acting on these assurances, and this was detrimental to Dodger because he lost his pay. Moreover, as Dodger relied on the assurance, he has also spent money on the estate and as per the decision in Ramsden v Dyson, this is an acquiescence on the part of Oliver that he accepts Dodger’s claim to the interest in the land. Nancy cannot enforce the arrangement. This is so because her agreement with Oliver was not a final agreement as it was “subject to permission from local council.” The deciding factors are the intentions of the parties to be bound by the contract; and the lack of written agreement. As per the Law of Property (Miscellaneous Provisions) Act 1989, Section 2, contract of sale of freehold estate must be written and as per provisions of common law for formation of contract as well as the provisions of the Section 2. Since the contract was not written, it is not enforceable.

6. If an unmarried couple purchases property together but make no declaration of the beneficial interest, the rule in Stack v Dowden, provides that the beneficial ownership mirrors legal ownership and even though the property is bought in the joint names, the partner that has contributed more to the purchase of the property will hold beneficial ownership to the extent of contribution. The same principle was also applied in Grant v Edwards. David and Victoria can sell the house and share the proceeds as per their beneficial interest share in the property.

7. Principles for determining the ownership of a family home for unmarried couples are unfair, uncertain and illogical. Unfair and illogical decisions do result from the application of trust and property law principles to disputes between unmarried couples over the distribution of property and financial resources. There is doctrinal confusion because of application of doctrines of proprietary estoppel, constructive trust, and implied trust in such cases. In Stack, legal ownership of the property in the joint names of both parties did not stop the court from deciding that beneficial ownership was to be distributed in a different manner. In Jones, the court decided to change and readjust the share in the property based on the change in living arrangements and non-payments of mortgage payments.

In Lloyds Bank v Rosset the court held that there should be some expressed common intention to share the beneficial interest in the property and the claimant should have acted to his detriment. Therefore, there is doctrinal confusion in this area. Unfair results are seen in cases like Lloyds Bank, where the court refused to consider financial contributions other than those that were made towards purchase. This is unfair because a partner may have contributed in other ways, like giving up work for childcare, while the other party works and earns money, which go towards paying mortgage payments. The approach of determining ownership on the basis of mortgage payments or other contributions towards purchase of home is unfair because it discounts the many ways in which the non-paying partner may be contributing to the purchase or payments.