A more recent version of these Freehold Leasehold Estates notes – written by Cambridge/Bpp/College Of Law students – is available here.
The following is a more accessble plain text extract of the PDF sample above, taken from our GDL Land Law Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:
Land Law : Proprietary Rights, Freehold & Leasehold Estates Proprietary rights
?????Closed 'list' of proprietary rights, s1 LPA 1925:
?????Only two estates in land o S1(1)(a): Freehold (fee simple absolute in possession) o S1(1)(b): Leasehold (term of years absolute)
?????Fee simple absolute in possession: absolute right to possession indefinitely
?????Formalities for transfer of freehold, 3-stage process: o (1) contract
? Point at which equitable title transfers to buyer (seller retains legal title); gives equitable interest in land to buyer. o (2) Completion/Deed
? Point at which legal title transfers to buyer if unregistered land o (3) registration
? Point at which legal title transfers if registered land (1) Contract (s2 LPMPA):
?????[[need general 2 contract conditions: offer & acceptance; consideration; ICLR]].
?????And specific for land:
?????[contracts made before 27 Sep 1989: LPA 1925 s40
?????s40, must satisfy (a) (b) or (c).
? ?? ? [contracts made on/after 27/9/1989:] s2 LPMPA: (1) in writing; (2) contain all terms; (3) signed by both parties.
?????NB: s2(1): contracts may be exchanged (2 identical contracts, seller and buyer sign one each, exchanged)
?????NB: may have incorporation of terms by reference to another document (s2(2), incorporating that document into the contract).
?????[[same formalities for sale of any estate/interest in land (leasehold, agreement to grant mortgage, easement, lease etc)]].
?????Equitable estate held by buyer from date of contract ('estate contract', not full legal estate).
?????Re options, Spiro v Glencrown: for options, requirements of s2 LPMPA apply to the initial grant of the option; but to exercise the option, is a unilateral act of the buyer, doesn't need seller's consent.
?????NB, Cannot have s2 contract formed by correspondence: Commission for New Towns v Cooper: written offers &
acceptances by correspondence can no longer give rise to a written
1 contract, under s2 LPMPA. For correspondence to result in a binding contract, must culminate in a single doc, referring to every other doc, signed by both parties.
?????Re 'contain all terms', 3 ways to save a contract: collateral contract, Record v Bell; separate contract, Tootal v Guinea; rectification, s2(4), Wright v Robert Leonard): o Collateral contract to induce, Record v Bell: a collateral contract (where the consideration = entry into another contract), designed to induce a buyer into purchase, need not comply with s2 LPMPA, is separate from contract of land. [[re additional agreement for seller to present proof of ownership paperwork; this additional agreement not contained within sale of land contract; buyer argued this meant sale of land contract not compliant with s2 LPMPA as didn't contain all terms; held: additional contract not part of land contract, was collateral, so s2 irrelevant].]
o Separate contract, not directly concerned with sale of land need not be contained in same document as land sale agreement, can be 'hived off', Tootal Clothing v Guinea Properties: contract re seller reimbursing leaseholder for shop fittings he would have to carry out; this contract was 'hived off' into another contract---the existence of second contract didn't contravene s2 LPMPA. o Cannot be 'hived off' if the main land contract is conditional on terms of separate contract (North Eastern v Coleman).
?????Equitable remedy of Rectification (s2(4) LPMPA) o An omission of 'all terms' can be rectified by courts if left out by mistake, but clearly agreed to by both parties, if just' Wright v Robert Leonard o Agreement to sell leasehold included an oral agreement that all fixtures and fittings would be included; wasn't included in written contract, so not s2 compliant; couldn't treat as collateral contract (Record) or as separated, 'hived off' (Tootal)?
o Court granted equitable remedy of rectification---
including the missing terms about interior fittings. o S2(4) LPMPA, rectification o No rectification if the terms were expressly excluded (must have been a mistake): o Oun v Ahmad: unlike Wright v Robert, was not excluded by mistake; here, was expressly excluded. No rectification. o Ruddick v Ormston
? [[NB: note how courts don't like people trying to wiggle out of binding agreements, so have used various methods to uphold the contract, getting round non-compliance with s2: treat as 'collateral' (Record v Bell); treat as 'separate'/hived off
2 (Tootal Clothing v Guinea); or rectify if mistake (Wright v Robert Leonard).]]
Variations to contract
??? ?Where correctly created contract; subsequent variation.
? ?? ? McCausland v Duncan Lawrie: o Tried to vary completion date. o A variation of a 'material term' (eg completion date) must comply with s2 LPMPA (so can't be oral). Exceptions for s2 LPMPA formalities
? (1) contracts to grant a lease of term not exceeding 3 years (S54(2) LPA 1925)---which takes effect 'in possession', if at best rent obtainable.
? (2) contracts made at public auctions
? (3) the creation of resulting, implied or constructive trusts (s53(2) LPA 1925).
? (4) certain contracts regulated by Financial Services & Markets Act
2000. ? (5) Proprietary estoppel: courts may uphold non-s2 compliant agreements under doctrine of PE (Yaxley v Gotts). Proprietary effect of a binding contract (an estate contract)
? ?? ? Effect of estate contract ? the equitable interest in the land passes to buyer [[seller retains legal title]].
? ?? ? So estate contract = equitable interest in the land, held from date of contract. This is a proprietary right.
??? ?Why: 'equity regards that as done that which ought to be done'.
??? ?Can be protected against 3rd parties.
? ?? ? So if seller doesn't go through with sale, not handing over legal title, buyer can enforce his equitable interest under estate contract, with equitable remedies: SP, injunction etc. Remedies if either party breach estate contract
?????(1) Damages, available as of right for breach of contract. Usual measure = the loss C has suffered as result of the breach (Speciality Shops v Yorkshire).
?????(2) discretionary equitable remedies (awarded if 'fair &
equitable': o SP o Injunction o Rectification (eg Wright v Robert Leonard), rectifies the contract (2) completion
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