No CrossRef data available.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.
Published online by Cambridge University Press: 16 January 2009
The Property Acts of 1925 have restricted in several ways the old equitable doctrine of notice. This article is an attempt to bring together and summarise some of the effects and problems which result from one of the innovations which the Acts introduced to that end.
Section 10 of the Land Charges Act, 1925, enacts that certain ‘charges on, or obligations affecting, land’ may be registered as land charges in His Majesty's Land Registry. Some of these registrable charges have long been recognised as imposing an equitable burden upon the land concerned, and for present purposes we may confine our attention to two of them: (i) estate contracts, (ii) restrictive covenants. By ‘estate contract’, the section means a contract by an estate owner to convey or create a legal estate. By ‘restrictive covenant’ it means a covenant or agreement (not made between a lessor and lessee) restrictive of the user of land.
Both estate contracts and restrictive covenants are registrable if created after the Act came into force. But those which were already in existence before the Act are subject to a distinction: restrictive covenants older than the Act are not registrable—section 10, indeed, so defines a restrictive covenant (for the purposes of the Act) as to exclude them from the Act entirely; estate contracts older than the Act, however, do sometimes become registrable, namely, ‘if acquired under a conveyance’ (i.e., if the person who has the benefit of the estate contract assigns it) after 1925. This distinction, of course, is important and should be borne in mind.
1 Most if not all of these effects and problems are mentioned in the current treatises on the Law of Property and Conveyancing.
2 This peculiarity of estate contracts applies equally to the other charges which are registrable under Class C of s. 10—e.g., legal mortgages not protected by deposit of title deeds (‘puisne mortgages’). If created before 1926 and assigned after 1925, they should be registered within a year after the assignment, otherwise they are not enforceable against a subsequent purchaser for value of any interest in the land: s. 14 (2).
3 The burden of an estate contract or restrictive covenant contained in a lease sometimes runs even at law with the lease or reversion: see Spencer's Case, 5 Co. Rep. 16a; Law of Property Act, 1925, s. 142. A restrictive covenant between lessor and lessee is not registrable as a land charge. But an estate contract between lessor and lessee is so registrable, even, it seems, if it runs at law—e.g., an option to renew the lease: see Sharpe v. Coates [1948] 2 All E.R. 871; and compare Wright v. Dean [1948] Ch. 686, noted post, p. 269.
4 Section 10, which says what may be registered, is speaking of ‘charges on, or obligations affecting, land’.
5 For the rules which determine whether a contract to sell or to let creates an equitable interest, see e.g., Cheshire, Modern Law of Real Properly, 5th ed., pp. 144–146, 340, 667. For those which determine whether a restrictive covenant operates in equity as an incumbrance, see, ibid., pp. 301–311.
6 The Land Charges Rules, 1926, r. 1 (6), expressly provide that the Registrar ‘shall not be concerned to inquire into or otherwise verify the accuracy or validity of any matter or thing stated’ in any application made to him for a registration. See also Williams on Title, pp. 71–72, 502, and post, footnote 15. An order may be obtained from the court for the cancellation of an entry in the register: see s. 10 (8) of the Land Charges Act.
7 Though ineffectual in legal theory, they are likely in fact to injure the estate owner so long as they remain on the register—e.g., they are likely to deter prospective purchasers. For the court's power to order their removal from the register, see preceding footnote
8 But see footnote 9, infra.
9 There would seem to be a slight difficulty here, in that s. 199 (read with s. 205) applies only to a purchaser in good faith, whereas the Land Charges Act avoids the unregistered charge against the purchaser without making that requirement: s. 205 (1) (xxi) implies a requirement of ‘good faith’ except where the Act ‘expressly’ excludes it; and s. 199 does not so exclude it. On the other hand, the opening words of s. 205 (‘In this Act unless the context otherwise requires …’) perhaps allow its exclusion by implication. There is a like difficulty about the antinomy of valuable consideration (in ss. 199 and 205) and ‘money or money's worth’ (in L.C.A., s. 13).
10 See e.g., Cheshire, Modern Law of Real Property, 5th ed., pp. 144–147. Before 1926, the maxim was reasonably accurate only if the tenant, with his mere agreement for a lease, was actually in occupation of the premises, SO that purchasers would be bound to have constructive notice of his equitable rights: see Hunt v. Luck [1902] 1 Ch. 428, infra.
11 The rule, as formulated by the Court of Appeal in Hunt v. Luck [1902] 1 Ch. 428, 433, was as follows:—‘If a purchaser or mortgagee has notice that the vendor or mortgagor is not in possession of the property, he must make inquiries of the person in possession—of the tenant who is in possession—and find out from him what his rights are, and, if he does not choose to do that, then whatever title he acquires as purchaser or mortgagee will be subject to the right or title of the tenant in possession’.
12 Section 14 of the Law of Property Act, 1925, is irrelevant here. It enacts merely that ‘This Part (i.e., ss. 1–39) of this Act shall not prejudicially affect the interest of any person in possession’. It cannot therefore preserve possessors against the registration rules, for those are imposed by s. 199 of that Act, and by the Land Charges Act.
12a See Hanbury and Waldock, Law of Mortgages, 51, 56–58, and authorities there cited. The deposit of deeds is regarded, semble, as a sufficient act of part performance of the contract: ibid.
12b Although s. 13 of the Law of Property Act perhaps ousts s. 199 (1) (i) in such a case, it is conceived that, even without the latter section, notice of an estate contract which is void against one (for non-registration) cannot have any effect.
13 It seems probable that he would be held to have constructive notice in such a case. The doctrine of constructive notice does not apply to documents (such as the trust instrument under a trust for sale) in which a prudent purchaser would not expect to find anything to concern him. But the register is a document made for the very purpose of recording information of concern to him—though not the particular kind of information (a charge which ought not to be registered) which we are supposing to be there.
14 Land Charges Rules, 1925, r. 6. But the Land Charges Rules, 1926, r. 1 (6), expressly exempt the Registrar from any duty to ‘inquire into or otherwise verify the accuracy or validity’ of any statement or matter when he receives an application for a registration; see also footnote 15, infra.
15 Probably the words ‘made between a lessor and lessee’ (in L.C.A., s. 10) were intended to refer only to covenants contained in a lease or agreement for a lease.’ When one applies for the registration of a land charge one need not show the Registrar the documents, if any, which created it unless he specifically requires one to do so (Land Charges Rules, 1925, r. 9); and he is under no duty to verify the particulars which one gives of it: see preceding footnote.
16 See White v. Bijou Mansions [1937] Ch. 610, 617, per Simonds J., obiter: Wolstenholme and Cherry, Conveyancing Statutes (12th ed.), 298. Section 44 of the L.P.A., 1925, enacts that, unless there be a contract to the contrary, (i) neither lessees nor sub-lessees nor their assignees can ‘call for’ the title to the freehold, (ii) neither sub-lessees nor their assignees can ‘call for’ the title to the leasehold reversion. Moreover, subs. 5 of that section (reversing the rule in Patman v. Harland) enacts that when they are thus unable to ‘call for’ the title to the freehold or leasehold reversion they ‘shall not be deemed to be affected with notice’ of anything which that title would have revealed to them. It seems, therefore, that this subsection frees them from constructive notice of any unregistrable equities (even those improperly on the register) which have been imposed upon that freehold or leasehold title. On the other hand, anything which is properly on the register is a different matter, for s. 198 gives actual notice of that ‘to all persons and for all purposes’. In this latter case, therefore, there is a conflict between the two sections; but the authorities cited above indicate that s. 198 prevails. See further, Logan's, Dr. D. W. article, Patman v. Harland Today, 56 L.Q.R. 361–375.Google Scholar
17 It is apprehended that a negative covenant which does not ‘touch and concern the land’ within Spencer's Case cannot ordinarily run in equity under the rule in Tulk v. Moxhay, and that such decisions as Hall v. Ewin (1887) 37 Ch.D. 74, will nowadays be followed only where the lessee's covenant is beneficial to the lessor's reversion.
18 See footnotes 5, 6 and 7, ante.
19 See, e.g., Williams on Title, pp. 69–71; Gibson's Conveyancing (16th ed.), pp. 65, 92. In Re Forsey and Hollebone's Contract [1927] 2 Ch. 379, Eve J. held (probably obiter) that one cannot repudiate for an irremovable defect of which (by s. 198) one is deemed to have had actual, notice, even though the contract does specifically require the vendor to sell free from incumbrances. But this decision does not seem consistent with the earlier cases—e.g., Re Gloag and Miller (1883) 23 Ch.D. 320.
20 But see preceding footnote for the dictum in Re Forsey.