Land Law - Assignment Example

Land Law assignment The scenario concerns issues regarding equitable and legal interests in registered land arising as a result of joint tenancies. The will left by Michael in 2005 expressly conveys the land to his four children ‘jointly’, which renders it a joint tenancy where each of the tenants have equal share in the property. Thus, it is a legal joint tenancy, title to which is registered. Additionally, the scenario also raises issues concerning the law of severance. (i) Devolution of the legal estate The property was conveyed by will which stated that David, Aaron, Bartholomew and Christopher all must acquire title to it “jointly”. This creates a legal interest in the form of a joint tenancy by which all four recipients are entitled to equal and undivided shares of the property. The legal interest is necessarily that of joint tenancy here as a tenancy in common cannot subsist at law (s. 1(6) of the Law of Property Act 1925). The legal joint tenancy must, in the absence of any other intention in the trust instrument, should be followed by an equitable joint tenancy in the same, provided it fulfills the four unities required to form an equitable joint tenancy (Hammersmith and Fulham L.B.C v Monk (1992)), which is the case here. Hence, all three children that are of full capacity (Aaron, Bartholomeo and Christopher) hold the legal title in Oakhurst on a statutory trust governed by s. 35 of the Law of Property Act 1925, as well as the equitable title in the form of a joint tenancy subject to the provisions of the Trusts of Land and Appointment of Trustees Act 1996, meaning they hold the property as legal owners on a trust of land for themselves and David as equitable owners. David’s interest is necessarily equitable since he is a minor and until he becomes of age, he has an equitable share in the property according the provisions of TOLATA 1996, sched.1, para.1. Thus Bartholomeo, Christopher, and Aaron are the legal owners of Oakhurst holding it for the benefit of themselves and David as equitable owners. (ii) Size of David’s share Under a joint tenancy, David is entitled to an equal and undivided share in the property which should be accorded to him in the proceeds of sale. Moreover, as a joint tenant, David is also entitled to the Right of Survivorship which distributes the share of the deceased property equally amongst the surviving tenants. This, however, is only applicable if the joint tenancy has not been severed. The equitable interests in Oakhurst are capable of being severed from the joint tenancies so that a tenancy in common is created amongst the remaining joint tenants and the now-severed tenants in common. This allows the tenant to deal with his share of the property individually and also make sure that his share of the property passes to his heirs instead of the survivors of the tenancy. Thus, to analyze David’s share of the proceeds of sale, it is necessary to determine whether the joint tenancy was severed by the written note of Christopher, Bartholomew’s will, and Aaron’s mortgage. By virtue of s. 36(2), a person may be able to severe his share of the tenancy by giving notice in writing. We are told that Christopher writes to say that he no longer has any use for Oakhurst but expects a 25% share of the proceeds of sale were the property to be sold. Kinch v Bullard (1999) and Burgess v Rawnsley (1975) suggest this is sufficient to sever the joint tenancy, however, the facts of the case are closer to those seen in White v White (2000) where a contrary intention was shows to continue the joint tenancy whereas the written notice purported to sever it. The courts held that there was no severance in that case, and it is likely that they would follow the same route in Christopher’s case, given that his intentions to retain the joint tenancy are evident by his mention of retaining 1/4th of the proceeds of sale. Thus, on balance, the joint tenancy is still intact as far as Christopher’s concerned. In the case of Bartholomew, his share is subject to his wishes as mentioned in his will. An year has passed since his death and it is reasonable to believe that the notice of his intentions through the will was provided to the other joint tenants before Aaron later expressed his wish to sell the property in writing to Christopher and David. What falls to determine is whether he severed his joint tenancy interest to a tenancy in common so that the survivors of the tenancy are not entitled to his share, which would have been the case under a joint tenancy. On the facts, it does not seem so, and since the right of survivorship is superior to a will, his interest will be equally distributed amongst the remaining tenants David, Christopher and Aaron (Gould v Kemp (1834)). Aaron’s action of mortgaging his interest is more likely an “act operating on his own share”, which is enough to severe his equitable interest (Williams v Hensman (1861)). Bear in mind that Aaron is a trustee at law along with Christopher and thus cannot transfer the legal title alone without Christopher’s consent (First National Securities v Heggarty (1984)). He can only mortgage his equitable interest according to s.63 of the LPA 1925, which he does, thereby severing his equitable joint tenancy and becoming a tenant in common of 1/3rd of the property (since Bartholomew is now dead). Thus, if the property is to be now sold, David ought to be entitled to 1/3rd of the proceeds. (iii) If David disagrees as to the sale, how would the court order the sale? If David was to disagree, the other trustees with legal titles (Aaron and Christopher) can summon the court to intervene and order a sale under s.14 of TOLATA 1996. Under the old law, the Court favored a sale in case of a dispute as the trusts carried with them a duty to sale under s. 30 of the LPA 1925. However, with the advent of TOLATA 1996, the position has changed and the trusts are now of land instead of trusts for sale. As a result, the courts are reluctant to order a sale as decidedly as before. Much turns on the facts of the case and considerations are given to factors such as the purpose of creation of the trust, if the co-owners have any children, etc. Assuming David has not come of age, he is still a minor with an equitable interest in current occupation of the property, and the court may deny the sale on this basis (Edwards v Lloyds TSB (2004)). The trust instrument itself may be utilized, and since in this case it stipulated that the property be used as a “family home”, the courts would be further reluctant to order a sale (Barclay v Barclay (1970)). Since David has not reached full capacity yet, on balance, the court may order a postponement of sale till he becomes of age and is able to make a more conscious decision. Read More