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Land Law - Registered Land Priorities

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    A was the registered proprietor of a fee simple estate, subject to a legal right of way granted by A's predecessor in title to a neighbour, B, to enable her to reach the public road from her own adjacent property. B has not in fact used the right for some time. This transaction has been noted on the Land Register.

    A has now sold the estate to C, a property developer, who has been registered as proprietor at the Land Registry. C inspected the land before purchasing. However, at that stage he knew nothing of B's right of way (which showed no signs on the ground).

    Is C bound by B's right?


    My interpretation
    S.1 LPA - easements legal interests in land]

    Registered land - S.27(2)(d) LRA grant of an interest must be registered and S.38 LRA - whenever a person is registered as proprietor of an interest under S.27 the Registrar also enters a notice of that interest on the register.

    The grant of the easement was not registered with the Land Registry and so not afforded protection on the register.

    This is where I am stuck... because it was not protected under S.27, is it not capable of being a *legal* easement? Is it as simple as that or am I overthinking it? If it's not a legal easement because not registered, how does this affect priority on C?


    Help at this question would be appreciated greatly...
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    (Original post by suffocation1992)
    A was the registered proprietor of a fee simple estate, subject to a legal right of way granted by A's predecessor in title to a neighbour, B, to enable her to reach the public road from her own adjacent property. B has not in fact used the right for some time. This transaction has been noted on the Land Register.

    A has now sold the estate to C, a property developer, who has been registered as proprietor at the Land Registry. C inspected the land before purchasing. However, at that stage he knew nothing of B's right of way (which showed no signs on the ground).

    Is C bound by B's right?


    My interpretation
    S.1 LPA - easements legal interests in land]

    Registered land - S.27(2)(d) LRA grant of an interest must be registered and S.38 LRA - whenever a person is registered as proprietor of an interest under S.27 the Registrar also enters a notice of that interest on the register.

    The grant of the easement was not registered with the Land Registry and so not afforded protection on the register.

    This is where I am stuck... because it was not protected under S.27, is it not capable of being a *legal* easement? Is it as simple as that or am I overthinking it? If it's not a legal easement because not registered, how does this affect priority on C?


    Help at this question would be appreciated greatly...
    I think the analysis is as follows:

    1. Section 28 of the LRA 2002- first in time rule applies therefore prima facie the easement has priority over C's interest
    2. Section 29- reverses the first in time rule in cases where there has been a registrable disposition of a registered estate (A's title is registered) is made for valuable consideration (yes because C has paid) and it is completed by registration (yes because C has become registered proprietor).

    Therefore C's interest takes priority over B's interest UNLESS B's interest has 'protected' priority under section 29.

    The relevant part is the overriding interest under Sch 3 Para 3

    1. It is a legal easement therefore the Sch applies
    - Is it within the actual knowledge of C? No- facts state that he had no idea about it
    - would it have been obvious on a reasonably careful inspection of land over which the easement is exercisable? Again- facts state no.

    Seems that the easement will override. HOWEVER, Sch 3 Para 3(2) says that it will not override if the person entitled to the easement (B) proves that the easement has been exercised within the 1 year before the disposition (from A to C). On the facts, it states that B has not used the right of way 'for some time'.

    So depending on whether 'for some time' means he hasn't used it for more than a year (in which case it WON'T override and C's interest had priority) OR if he has used it in the year prior to disposition, his interest will override and C's interest will be postponed to B's.

    Hope this helps!
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    (Original post by alibaba03)
    I think the analysis is as follows:

    1. Section 28 of the LRA 2002- first in time rule applies therefore prima facie the easement has priority over C's interest
    2. Section 29- reverses the first in time rule in cases where there has been a registrable disposition of a registered estate (A's title is registered) is made for valuable consideration (yes because C has paid) and it is completed by registration (yes because C has become registered proprietor).

    Therefore C's interest takes priority over B's interest UNLESS B's interest has 'protected' priority under section 29.

    The relevant part is the overriding interest under Sch 3 Para 3

    1. It is a legal easement therefore the Sch applies
    - Is it within the actual knowledge of C? No- facts state that he had no idea about it
    - would it have been obvious on a reasonably careful inspection of land over which the easement is exercisable? Again- facts state no.

    Seems that the easement will override. HOWEVER, Sch 3 Para 3(2) says that it will not override if the person entitled to the easement (B) proves that the easement has been exercised within the 1 year before the disposition (from A to C). On the facts, it states that B has not used the right of way 'for some time'.

    So depending on whether 'for some time' means he hasn't used it for more than a year (in which case it WON'T override and C's interest had priority) OR if he has used it in the year prior to disposition, his interest will override and C's interest will be postponed to B's.

    Hope this helps!
    Aha that makes sense, and incredibly logical. Thanks for the help.

    One query though - Sch 3 Para 3 is for implied easements, the facts of my example show that a legal easement was granted in the past (so not implied since expressly granted)...
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    (Original post by suffocation1992)
    Aha that makes sense, and incredibly logical. Thanks for the help.

    One query though - Sch 3 Para 3 is for implied easements, the facts of my example show that a legal easement was granted in the past (so not implied since expressly granted)...
    Where does it say that it applies to implied easements only? Looking at the statute, it says:

    PARA 3(1) A legal easement or profit a prendre, except for an easement, or a profit a prendre which is not registered under the Commons Registration Act 1965 (c. 64), which at the time of the disposition—

    (a) is not within the actual knowledge of the person to whom the disposition is made, and

    (b) would not have been obvious on a reasonably careful inspection of the land over which the easement or profit is exercisable.

    (2) The exception in sub-paragraph (1) does not apply if the person entitled to the easement or profit proves that it has been exercised in the period of one year ending with the day of the disposition.

    Actually, I've just realised that since the LRA 2002, under section 27, an express easement is now a registrable disposition and on your facts it suggests that it has been registered SO you're right, Sch 3 Para 3 won't apply but not because Sch 3 Para 3 is reserved for implied easements (it applies to all legal easements) but because Sch 3 Para 3 only applies to unregistered interests.

    BUT it will still bind C because of section 38 of the LRA 2002 which requires that where a person is entered on the register as the proprietor of a registrable disposition that a notice is also entered. Therefore the notice has the effect of being an exception to section 29 so section 28 rule applies which means that C's interest is postponed to that of B.
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    (Original post by alibaba03)
    Where does it say that it applies to implied easements only? Looking at the statute, it says:

    PARA 3(1) A legal easement or profit a prendre, except for an easement, or a profit a prendre which is not registered under the Commons Registration Act 1965 (c. 64), which at the time of the disposition—

    (a) is not within the actual knowledge of the person to whom the disposition is made, and

    (b) would not have been obvious on a reasonably careful inspection of the land over which the easement or profit is exercisable.

    (2) The exception in sub-paragraph (1) does not apply if the person entitled to the easement or profit proves that it has been exercised in the period of one year ending with the day of the disposition.

    Actually, I've just realised that since the LRA 2002, under section 27, an express easement is now a registrable disposition and on your facts it suggests that it has been registered SO you're right, Sch 3 Para 3 won't apply but not because Sch 3 Para 3 is reserved for implied easements (it applies to all legal easements) but because Sch 3 Para 3 only applies to unregistered interests.

    BUT it will still bind C because of section 38 of the LRA 2002 which requires that where a person is entered on the register as the proprietor of a registrable disposition that a notice is also entered. Therefore the notice has the effect of being an exception to section 29 so section 28 rule applies which means that C's interest is postponed to that of B.
    I had learnt that Sch 3 applies to legal easements arising from an implied grant (perhaps I am mixing up implied easements and easements arising from implied grant?).

    McFarlane explains at 5.3:
    "[sch 3 para 3] needs to be understood in light of the general treatment of easements within the 2002 Act. The express grant of a legal easement is a registered disposition (as you pointed out above) and such easements necessarily appear on the register. Paragraph 3 is therefore directed at legal easements that arise from an implied grant... a legal easement arising from an implied grant is overriding if C has actual knowledge of its existence, or it is obvious on a reasonably careful inspection of the land, or it has been exercised in the year preceding the disposition."


    Anyway, yes so if it's an easement requiring registration under s.27 -> s.38 tells us it automatically gets entered as a notice -> s.29(1)(i) tells us that if it's a registered charge or entered as a notice, the rule in s.29 will not apply -> S.28 general rule saving B's pre-existing interest applies -> B's interest binds C

    YAY, I got it, thanks for putting some logic to this! But yes, if you could clarify what McFarlane says, that would be grand
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    Wow... I wish I understood Land Law as well as you guys....

    I'm being serious, I mean does anyone want to explain how on earth you answer problem questions, because everytime I think I understand them, I get myself confused...
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    (Original post by sophie_snail)
    Wow... I wish I understood Land Law as well as you guys....

    I'm being serious, I mean does anyone want to explain how on earth you answer problem questions, because everytime I think I understand them, I get myself confused...
    Mind maps have really helped me, Sophie. There are parts of the course where there is so much statute e.g. the rules in registered land for adverse possession are quite technical compared to the rules for adverse possession in unregistered land. Also, as here, the rules for priorities in registered and unregistered land are quite technical - I think drawing mind maps has helped:

    e.g. 'Is this first registration or a disposition?' 'disposition' --> 'is it required to be registered under s.27?'

    There are other parts of the land law course such as easements and freehold covenants which are mostly common law and less technical, in my opinion!

    Also, try reverse-revising. Skim through a chapter in the book and then try a problem question. That's how I'm doing it, but honestly I am dreading the exam.
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    (Original post by suffocation1992)

    McFarlane explains at 5.3:
    "[sch 3 para 3] needs to be understood in light of the general treatment of easements within the 2002 Act. The express grant of a legal easement is a registered disposition (as you pointed out above) and such easements necessarily appear on the register. Paragraph 3 is therefore directed at legal easements that arise from an implied grant... a legal easement arising from an implied grant is overriding if C has actual knowledge of its existence, or it is obvious on a reasonably careful inspection of the land, or it has been exercised in the year preceding the disposition."

    [/B][/I]

    YAY, I got it, thanks for putting some logic to this! But yes, if you could clarify what McFarlane says, that would be grand
    Haha no problem, it clarified some stuff for me as well, totally glossed over the s38 so glad that's flagged up for me

    As for McFarlane, reading that I think you're right in that Sch 3 Para 3 only applies to implied grants.

    I think what he's getting at is that after the 2002 Act, there will be very little express grants that will not be registered and therefore will be able to be unregistered overriding interests under Sch 3 Para 3. The purpose of section 27 was to ensure that everything that can be registered gets registered (mirror principle etc).

    Indeed if it is a registrable disposition, it will be void unless completed by registration so express grants--> registrable dispostion that must be completed by registration--> registration (+ notice on the register-section 38)--> obviously cannot be unregistered interest that overrides (and won't need to be protected as overriding interest anyway because of the notice)--> leaving the scope of Sch 3 Para 3 to implied grants (which don't seem to have any other way of protection)!
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    (Original post by alibaba03)

    Actually, I've just realised that since the LRA 2002, under section 27, an express easement is now a registrable disposition and on your facts it suggests that it has been registered SO you're right, Sch 3 Para 3 won't apply but not because Sch 3 Para 3 is reserved for implied easements (it applies to all legal easements) but because Sch 3 Para 3 only applies to unregistered interests.
    I am not sure about this point. If an easement is not registered, it canot be a legal - unless it is implied. As a result, Sch 3 Para 3 will de facto only apply to implied easements.

    Indeed if it is a registrable disposition, it will be void unless completed by registration so express grants--> registrable dispostion that must be completed by registration--> registration (+ notice on the register-section 38)--> obviously cannot be unregistered interest that overrides (and won't need to be protected as overriding interest anyway because of the notice)--> leaving the scope of Sch 3 Para 3 to implied grants (which don't seem to have any other way of protection)!
    A registerable disposition not completed by registration is not void - it still has effect in equity. This can be relevant in cases of Sch 3 Para 2.

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