CILEx L3 Land Law Essentials 2 — Questions and Answers
Question 1: What is the legal effect of a mortgage on registered land?
- It transfers ownership of the property to the lender
- It creates a legal charge giving the lender security over the property without transferring ownership (Correct answer)
- It creates a lease in favour of the lender
- It gives the lender the right to occupy the property
Correct answer: It creates a legal charge giving the lender security over the property without transferring ownership
Under the LRA 2002, a mortgage of registered land takes effect as a legal charge (s.23(1)(a) and s.51). The borrower retains ownership and possession of the property, while the lender obtains security rights including the power of sale, the right to appoint a receiver, and the right to possession. The charge must be registered to take effect as a legal interest (s.27(2)(f)).
Question 2: What is adverse possession, and how long must a squatter occupy registered land before applying for title under the LRA 2002?
- Occupying land without permission for 5 years
- Occupying land without permission for 10 years, then applying to be registered as proprietor (Correct answer)
- Occupying land without permission for 12 years with automatic acquisition of title
- Occupying land without permission for 15 years
Correct answer: Occupying land without permission for 10 years, then applying to be registered as proprietor
Under the LRA 2002, a squatter who has been in adverse possession of registered land for 10 years may apply to be registered as proprietor (Schedule 6). The registered owner is notified and has 65 business days to object. If they object, the application fails but the squatter can reapply after a further 2 years if still in possession. This replaced the old 12-year limitation period which applied to unregistered land under the Limitation Act 1980.
Question 3: Under s.52 of the Law of Property Act 1925, what is generally required for the creation or transfer of a legal estate in land?
- A verbal agreement in front of witnesses
- A deed (Correct answer)
- A written contract signed by both parties
- Registration at the Land Registry only
Correct answer: A deed
Section 52(1) of the Law of Property Act 1925 provides that all conveyances of land or of any interest therein are void for the purpose of creating or conveying a legal estate unless made by deed. A valid deed must comply with s.1 of the Law of Property (Miscellaneous Provisions) Act 1989: it must be clear on its face that it is a deed, it must be signed, and the signature must be witnessed and delivered.
Question 4: What is the significance of Williams & Glyn's Bank v Boland [1981] in land law?
- It established that a mortgage could be created without a deed
- It confirmed that a spouse with a beneficial interest who was in actual occupation had an overriding interest binding the bank (Correct answer)
- It established the rules for adverse possession of registered land
- It defined the requirements for a valid easement
Correct answer: It confirmed that a spouse with a beneficial interest who was in actual occupation had an overriding interest binding the bank
In this landmark case, the House of Lords held that Mrs Boland, who had a beneficial interest in the matrimonial home (through her contribution to the purchase price) and was in actual occupation, had an overriding interest under s.70(1)(g) of the Land Registration Act 1925 (now Schedule 3, paragraph 2 of the LRA 2002). The bank's mortgage was therefore subject to her interest, even though it did not appear on the register.
Question 5: What is a licence in the context of land law, and how does it differ from a lease?
- A licence grants exclusive possession for a term; a lease does not
- A licence is mere personal permission to be on land and does not create a proprietary interest, unlike a lease (Correct answer)
- A licence can bind third parties; a lease cannot
- A licence must be granted by deed; a lease can be oral
Correct answer: A licence is mere personal permission to be on land and does not create a proprietary interest, unlike a lease
A licence is merely a personal permission to be on someone's land, preventing what would otherwise be a trespass. Crucially, it does not create a proprietary interest in land and therefore cannot bind third parties (Ashburn Anstalt v Arnold [1989]). A lease, by contrast, creates a legal estate giving the tenant exclusive possession for a defined term. The distinction was clarified in Street v Mountford [1985], where the House of Lords held that exclusive possession for a term at a rent creates a lease regardless of what the parties call the arrangement.
Question 6: What is meant by the 'curtain principle' in land registration?
- All interests in land must appear on the register
- Beneficial interests behind a trust are kept off the register and overreached on sale (Correct answer)
- The register can be viewed by anyone
- Only legal interests can exist in registered land
Correct answer: Beneficial interests behind a trust are kept off the register and overreached on sale
The curtain principle means that beneficial interests under a trust of land are kept behind a 'curtain' and do not appear on the register. On a sale by two or more trustees, these equitable interests are overreached — they are detached from the land and attach instead to the purchase money (City of London Building Society v Flegg [1988]). This allows purchasers to take free of trust interests provided they pay the purchase money to at least two trustees.
CILEx L3 Land Law Essentials 2
What is the legal effect of a mortgage on registered land?