The Law Commission

Working Paper No. 94

Trusts of Land

HER MAJESTY'S STATIONERY OFFICE

The Law Commission was set up by section 1 of the Law
Commissions Act 1965 for the purpose of promoting the reform
of the law.

The Law Commissioners are:

The Honourable Mr. Justice Beldam, Chairman

Mr. Trevor M. Aldridge
Mr. Brian Davenport Q.C.
Prof. Julian Farrand
Mrs. Brenda Hoggett

The Secretary of the Law Commission is Mr. J. G. Gasson and its

offices are at Conquest House, 37-38 John Street, Theobalds
Road, London WC1 N 2BQ.

This Working Paper, completed on 30 September 1985 is

circulated for comment and criticism only.

It does not represent the final views of the Law Commission.

The Law Commission would be grateful for comments on this

Working Paper before 30 June 1986.

All Correspondence should be addressed to:

Mrs. C. M. Hand
Law Commission
Conquest House
37-38 John Street
Theobalds Road
London WC1 N 2BQ

(Tel: 01-242 0861, ext 237)

The Law Commission
Working Paper No. 94

Trusts of Land

LONDON
HER MAJESTY'S STATIONERY OFFICE
0 Crown Copyright 1985
Firstpublished 1985

ISBN 0 11 730175 2
 147-335-02

THE LAW COMMISSION

WORKING PAPER NO. 94

TRUSTS OF LAND

CONTENTS

Paragraphs
Introduction 1.1 - 1.5
The present system 2.1 - 2.2
An outline of t h e problems 3.1 - 3.27
T h e interests which any
system must t a k e into account 4.1 - 4.6
Outline of proposals
for reform 5.1

Proposal I 6.1 - 12.1

Proposal I1 13.1 - 13.10

Proposal I11 14.1

Proposal IV 15.1 - 15.9

Proposal V 16.1 - 16.18
Conclusion 17.1

Appendices

A. References
B. Statutes
C. Extracts from Law Reform
Committee, 23rd Report

...
111
 TRUSTS OF LAND

SUMMARY

In this Working Paper, t h e Law Commission examines, as p a r t

of its programme for t h e simplification of conveyancing, t h e law relating
to trusts of land. T h e paper presents five possible reforms: t h a t t h e r e
should b e a new t r u s t of land with a power of sale; t h a t all settled land
should be converted into land held under trusts for sale; t h a t t h e Settled
Land A c t should only apply if i t is expressed to so so; t h a t t h e r e should be
a new form of co-ownership which does not involve a t r u s t for sale; and a
series of miscelleanous minor reforms. T h e Law Commission
provisionally recommends t h e f i r s t of these, but t h e purpose of t h e paper
is to obtain t h e widest possible range of views on a l l of them.

iv
 TRUSTS OF LAND

Introduction

1.1 Ever since t h e reforms of property law in t h e 1920's, t h e r e

have been suggestions as to how those reforms should themselves be
reformed.' As p a r t of i t s programme for t h e simplification of i

conveyancing and as a result of a recommendation of t h e Government's

C o m m i t t e e on Conveyancing, t h e Law Commission has prepared this
paper, which i t hopes will provide a focus for discussion of reform in t h e
a r e a of trusts of land. T h e views expressed h e r e a r e not t h e final views
of t h e Law Cornmission. W e hope t h a t t h e r e will be detailed and wide-
spread discussion both of our proposals and of any others t h a t may b e put
forward.

1.2 The scope of this paper is wide. One of t h e notable features

of English land law i s t h e way in which a wide variety of different
interests c a n be c r e a t e d in one piece of land, and those interests a r e
themselves t r e a t e d as property. Among t h e most usual interests which
people wish t o c r e a t e a r e concurrent interests, where t w o or more people
hold interests in land together, and successive interests, where land is
given to o n e person during his or her lifetime and t h e r e a f t e r t o another.
A t present such interests a r e c r e a t e d under t h e Settled Land A c t 1925 or
t h e Law of Property A c t 1925, part of which is concerned with trusts for
sale. W e shall be looking both at t h e present structures within which
successive and concurrent interests a r e c r e a t e d and at some other
possible structures which might offer advantages over t h e present system.

1.3 This paper does not follow t h e usual Law Commission pattern
of setting o u t t h e existing law in detail. T h e law on settled land and on
trusts for sale is more than adequately dealt with in existing legal
writings. T h e following paragraphs contain a brief account of t h e present

I S e e Appendix A for a list of books and articles consulted.

1
system, but while we still explain particular points when necessary to t h e
discussion, for a general account of t h e law w e refer t h e reader to t h e
standard t e x t b o o k s 2 Some sections of s t a t u t e s referred to in t h e
discussion a r e set out in full at Appendix B.

Historical aspects
1.4 In considering possible r e f o r m s of this a r e a of law i t i s
important not to lose sight of t h e reasons why t h e law is in its present
form. This is not t h e place for a lengthy historical a c ~ o u n t However,
.~
t h e r e a r e certain problems which t h e present legislation a t t e m p t e d to
deal with and i t is necessary to note these, to ensure t h a t any reform does
not inadvertently give rise to t h e m again.

1.5 The wish to t i e up one's property for more than one generation
has always been a common one. However, i t b e c a m e a p p a r e n t in t h e
nineteenth century t h a t settlements w e r e causing major difficulties. If
t h e interest in land w e r e split between t h e tenant for life and
remaindermen, then i t was sometimes e x t r e m e l y difficult for any p a r t of
t h e land to be sold or otherwise dealt with. This had serious implications
for t h e economic use and development of land. T h e solution adopted in
t h e nineteenth century, and followed in t h e Settled Land A c t 1925, was to
give increased powers of disposition and management to t h e tenant for
life. His position was further strengthened by t h e Law of P r o p e r t y A c t
1925, when t h e future interests of t h e remaindermen w e r e m a d e equitable
only, and t h e tenant for life was given power to convey t h e legal f e e
simple in t h e land. I t is important t h a t any reform should retain t h e
advantage of t h e present system, t h a t t h e r e is always someone who c a n
deal with t h e land.

2 Megarry and Wade, The Law of R e a l Property, 5th ed., 1984; pp.
311-464, Cheshire & Burn's Modern Law of R e a l Property, 13th ed.,
1982, pp. 165-357.

3 For a brief historical a c c o u n t see Cheshire and Burn, ibid, pp. 69-80.
For more detail see Simpson, An Introduction to t h e History of t h e
Land Law.

2
T h e Present System

2.1 A t present t h e r e a r e t w o possible ways of creating successive

interests in land, and one of creating concurrent interests. Where
successive interests a r e concerned, whichever system is used, t h e
beneficial interests of t h e l i f e t e n a n t and t h e remainderman a r e equitable
only.’ The difference between t h e two systems lies principally in how
t h e legal estate is held and who has t h e powers of management. Where
successive interests a r e c r e a t e d under t h e Settled Land A c t 1925, t h e
t e n a n t for l i f e has a beneficial l i f e interest. However, for t h e purposes
of dealing with t h e land h e also holds t h e legal estate? H e has wide
powers of management. A purchaser will b e able to acquire a legal f e e
simple absolute from t h e tenant for life f r e e from t h e equitable interests
c r e a t e d by t h e s e t t l e m e n t provided t h a t t h e purchaser pays t h e purchase
money t o at least t w o trustees o r t o a trust Corporation. Where
successive interests a r e c r e a t e d behind a trust for sale, t h e legal estate is
held by t h e trustees, and generally it is they who have t h e powers of
management. A purchaser will b e able t o acquire t h e legal estate f r e e
from t h e equitable interest from t h e trustees by paying t h e purchase
money to t h e trustees.

2.2 Concurrent interests in land usually exist behind a trust for

sale.6 T h e only permitted concurrent interest in t h e legal estate is a
joint tenancy. Legal tenancies in common were abolished by s.34 of t h e
Law of Property A c t 1925. Therefore t h e e f f e c t of a conveyance t o t w o
or m o r e people as beneficial joint t e n a n t s is t h a t they hold t h e legal
estate as joint t e n a n t s on t r u s t for sale, for themselves as beneficial joint

4 Law of Property A c t 1925, s.1.

5 This i s not so if h e i s a n infant, o r in s o m e o t h e r way incapacitated,

when t h e r e are complex provisions as t o who should exercise t h e
powers of the t e n a n t f o r life.

6 Law of Property A c t 1925, ss.34-36. Where land is settled under

t h e Settled Land A c t 1925 and t h e r e a r e joint tenants f o r life, t h e r e
will be no t r u s t for sale.

3
tenants, and t h e effect of a conveyance to t w o or more people as t e n a n t s
in common is t h a t they too hold t h e legal estate as joint t e n a n t s on t r u s t
for sale, but for themselves a s tenants in common.

An Outline of t h e Problems

3. I Before looking at proposals for reform i t is clearly important

to establish what problems exist. The following paragraphs describe
problems which have become apparent through t h e case law or have been
discussed in t h e academic literature. I t may well b e t h a t we have failed
to identify all t h e problems, and we would be very glad to hear of others.
Quite a p a r t from t h e specific problems, i t is now sixty years since t h e r e
was last substantial legislation in this a r e a , and as many of t h e provisions
then were consolidating ones, much of t h e law d a t e s back a hundred years
or more. That alone, of course, is not a n argument for change, but i t is a n
argument for a re-examination of t h e law, not least because t h e social
circumstances surrounding property ownership have changed greatly in t h e
last forty years. I t is only t h e problems t h a t a r e discussed here. Possible
solutions a r e considered l a t e r in t h e paper.

A. Dual system

3.2 The following problems a r e those t h a t a r i s e because, at

present, successive i n t e r e s t s in land can be c r e a t e d e i t h e r as s e t t l e d land
under t h e Settled Land A c t 1925 or as interests behind a t r u s t for sale. I t
has o f t e n been suggested t h a t a dual system is unnecessary and t h a t one
system for successive i n t e r e s t s would be sufficient. Originally t h e t w o
systems performed d i f f e r e n t functions? T h e s t r i c t settlement, using
combinations of l i f e i n t e r e s t s and entailed i n t e r e s t s (which before 1926
could exist as legal estates), was intended to keep land within t h e
ownership of a particular family. In many cases t h e t e n a n t for l i f e would
occupy t h e land. T h e t r u s t f o r sale was used e i t h e r where a s a l e was

7 For a full historical account see Simpson, An Introduction to t h e

History of t h e Land Law, 1961 pp. 188-194, 218-224.

4
actually intended, or where t h e land concerned was intended to be an
investment, to be bought and sold as market conditions demanded, t h e
t e n a n t for life being paid t h e income from it. By t h e mid-19th century i t
was apparent t h a t s t r i c t s e t t l e m e n t s caused difficulty in t h a t , if t h e
s e t t l e m e n t was not well drafted, t h e powers of t h e t e n a n t for l i f e were
too limited t o enable t h e land t o b e managed properly, and however t h e
s e t t l e m e n t was drafted, s a l e of t h e land was extremely difficult as no
person had t h e power to convey t h e fee simple. A series of reforming
s t a t u t e s culminating in t h e Settled Land Act 1925 increased t h e powers of
t h e t e n a n t for life and ensured t h a t t h e r e was also some person able to
convey t h e fee simple in t h e land. A t t h e s a m e t i m e t h e Law of Property
A c t 1925, s.1 prevented life interests from existing as legal estates, so
t h a t a l l s e t t l e m e n t s had to t a k e effect behind a trust. T h e effect of these
reforms has been t o remove many of t h e differences between t h e t w o
systems of settlement. In either system t h e land can be sold and t h e
s t r i c t s e t t l e m e n t is no longer an e f f e c t i v e method of keeping land in t h e
family. The remaining differences c e n t r e on who makes t h e decisions
with respect to t h e land. I t is arguable t h a t t h e differences a r e not
sufficient to justify t h e continuing existence of t w o systems.

3.3 Priority given to s e t t l e d land. The legislation is so phrased

t h a t when successive interests a r e created, a t r u s t for sale must b e
expressly adopted (except where imposed by statute); otherwise t h e
S e t t l e d Land A c t will apply. This means t h a t where trusts of land a r e
c r e a t e d without proper advice i t is almost c e r t a i n t h a t t h e land will b e
settled. This is most likely to occur where wills are, as o f t e n happens
drawn up without advice. In some cases this will be what t h e t e s t a t o r
would have wanted, but in many cases it will not be and additional
expense f o r t h e beneficiaries may result because additional documents
and a different form of probate a r e required. If a n inadvertent
s e t t l e m e n t is c r e a t e d by will and t h e executors do not realise this,
problems may b e caused for purchasers (see below).

5
3.4 Definition of t r u s t for sale. Inadvertent s e t t l e m e n t s may
a r i s e not through failure to decide which is required but through failure to
c r e a t e a valid t r u s t for sale. The definition of a t r u s t for s a l e as an
immediate binding t r u s t for sale has been criticised.l As a definition i t
i s poor because i t defines a thing as a particular kind of t h a t thing. The
word "binding" has caused particular problems because a t r u s t should be
binding anyway and t h e c o u r t s have considered t h a t i t must mean
something other t h a n t h e t r u s t e e s being under a duty to sell. 9

3.5 Rights of residence. In other cases, s e t t l e d land has been

c r e a t e d inadvertently because a right of residence has been conferred on
a person for his or her lifetime. I t is not entirely clear t h a t t h e
conferment of such a right was intended to be sufficient to bring the land
within t h e S e t t l e d Land Act. The technical question to b e decided was
whether land "stands for t h e t i m e being limited in t r u s t for any persons by
way of succession"." However t h e c o u r t s have made i t clear t h a t t h e y
will t r e a t such land as s e t t l e d land especially if t h e r e is no other way to
p r o t e c t t h e rights of t h e l i f e resident." Giving such a person a l l t h e
powers of disposition and management of a t e n a n t for life has been much
criticised. T h e r e should be some provision for giving rights of residence
during a person's l i f e t i m e which do not cause technical complications.
This problem is discussed f u r t h e r below 12 .

8 Law of Property A c t 1925, ~.205(11(xxix), and see Megarry and

Wade, T h e Law of R e a l Property, 5th ed., 1984, pp. 386-388.

9 R e Parker's S e t t l e d E s t a t e s [I9281 Ch. 247, R e R d e r and

Steadman's C o n t r a c t 119271 2 Ch. 62, R e Norton 1[92*
Beamount S e t t l e d E s t a t e s [19371 2 All E.R. 353, R e Sharpe's Deed of
Release E19391 Ch. 51.

10 Settled Land A c t 1925, s.l(l).

11 R e Duce and Boots Cash Chemists (Southern) L t d [1937] Ch.642,

- -L194812 All E.R.
Bannister v. Bannister
Ch. 359.
133, Binions v. Evans [1972]

12 S e e para. 16.16.

6
B. Making good t i t l e

3.6 If a purchaser of land subject to a t r u s t for s a l e fails to

comply with t h e provisions of s.27 of t h e Law of Property Act 1925, which
s t a t e s t h a t t h e purchase price must be paid t o a t least two trustees (or a
t r u s t corporation) t h e conveyance will not b e void, although interests
under t h e t r u s t for sale will not b e overreached. If a purchaser of s e t t l e d
land fails to comply with t h e provisions of s.18 of t h e Settled Land A c t
1925, t h e conveyance will be void e x c e p t in so far as i t binds t h e
beneficial interest of t h e t e n a n t for life. In some circumstances a
purchaser may be protected by s.110 of t h e S e t t l e d Land Act, which is
discussed in t h e following paragraph. I t is questionable whether i t is
necessary for t h e position of a purchaser to vary in this way.

3.7 The drafting of s.110 of t h e Settled Land Act 1925 has led to
t h e suggestion t h a t i t fails to give purchasers enough protection and t h a t
they may have to examine t h e t r u s t instrument themselves, contrary to
t h e general principles of t h e S e t t l e d Land A c t 1925. This is probably a
theoretical problem rather than a practical one. A real problem t h a t has
arisen is t h e relationship between s.110 and s.18 of the Act. Section 110
is meant t o give some protection to a purchaser if h e buys in good faith,
but under s.18, if land is s e t t l e d land, then any unauthorised disposition is
void. I t is not c e r t a i n which prevails, nor is i t clear whether s.110 offers
any protection where t h e purchaser does not know t h a t h e is dealing with
t h e t e n a n t for life. 13

3.8 Where s e t t l e d land is c r e a t e d by will (particularly a home-

made one) i t is easy for t h e executors not to realise this and they may, for
example, v e s t t h e land in trustees rather than in t h e t e n a n t for life. I t
may t h e n b e difficult for e i t h e r t h e t e n a n t for life or t h e t r u s t e e s or their
successors to make a good t i t l e to a l a t e r purchaser. I 4

13 Compare Weston v. Henshaw [I9501 Ch. 510 with R e Morgan's Lease

119721 C h r -
14 As, for example, in R e Duce and Boots Cash Chemists (Southern)
-
Ltd [1937]Ch. 642.

7
3.9 T h e r e is no formal provision for t h e termination of a t r u s t for
sale. This means t h a t purchasers of land which has been subject to a t r u s t
for sale may be put in t h e position of having to investigate t h e t r u s t s in
15
order to ascertain that t h e t r u s t for sale has ended.

C. Control by beneficiaries
3.10 In general t h e beneficiaries of a t r u s t of land a r e t r e a t e d no
differently from t h e beneficiaries of a t r u s t of any other kind of property.
This may, itself, be t h e cause of some problems. Land is not like most
other kinds of property; each piece is, in principle, unique, and, more
importantly, i t may be t h e place where t h e beneficiaries live, or want to
live in the future. Questions of control over t h e land a r e t h e r e f o r e
particularly important.

3.1 I Those entitled to s e t t l e d land in remainder. It is impossible

for a remainderman to prevent the s a l e of t h e land, unless t h e r e is lack of
good f a i t h on t h e p a r t of t h e t e n a n t for life. This leaves t h e
remainderman in a very weak position because t h e land may have already
been sold before h e becomes a w a r e of t h e t e n a n t for life's intention to
16
sell.

3.12 Duty to consult. The t r u s t e e s of land held on a s t a t u t o r y

t r u s t for sale'' have a duty to consult t h e beneficiaries." There is no
such duty where express t r u s t s for sale a r e concerned. Even as regards
s t a t u t o r y t r u s t s t h e provision i s weak. I t only applies "so f a r as i s

15 Except where joint t e n a n t s were holding on t r u s t for themselves and

t h e r e is only one survivor, Law of Property (Joint Tenants) A c t
1964.

16 See, for example, England v. Public Trustee (1967) 112 S.J. 70.

17 S e e para. 2.2.

18 Law of Property A c t 1925, s.26. (3) substituted by t h e Law of

Property (Amendment) A c t 1926, Sched.

8
practicable." The trustees only have t o give e f f e c t to t h e wishes of t h e
beneficiaries "so f a r as consistent with t h e general interest of t h e trust"
and a purchaser is not a f f e c t e d by t h e trustees' failure to carry out or
comply with t h e result of any consultation.

3.13 Delegation. I t has been suggested t h a t t h e power to delegate

t h e management of land to a t e n a n t f o r life of land held on trust for sale
is inadequate. If t h e power to delegate is not exercised, t h e tenant for
life is l e f t with no control, which, may be unsatisfactory if t h e trust for
sale is being used as a substitute for settled land. If t h e power is
exercised, ownership and management a r e separated which may be
undesirable. The t r u s t e e s retain t h e legal interest. If t h e tenant for life
is not in possession, h e may not be able t o bring a n action in his own name
to protect t h e reversion of any property leased. As h e is not t h e
covenantee, h e cannot s u e on t h e covenants in t h e lease. I t may be t h a t
these difficulties do not cause problems in practice as t h e trustees always
t a k e appropriate action, but, in theory at least, they do exist. W e would
be interested to hear from those with practical experience of this area.
In addition it has been said,19 "Psychologically in t h e management of a
country estate this duty to act in t h e name of another seems unsound".
Whether t h i s is t r u e today s e e m s less likely. Ownership and management
are commonly separated, f o r example, in limited companies and we doubt
t h a t t h e r e is any general issue of principle a t stake. Making trustees
delegate c e r t a i n powers in certain situations would minimise t h e
difference between t h e t w o systems.

3.14 Sale subject to consent. In settled land it is not possible t o

make t h e sale of t h e land or t h e exercise of other powers subject to t h e
consent of s o m e other person,20 for example, a remainderman. Making

19 P o t t e r , S t r i c t S e t t l e m e n t and Trust for Sale, (1944) 8 Conv. (N.S.)

147, 157.
20 Settled Land A c t 1925, s.106.

9
t h e consent of a beneficiary necessary for t h e sale of land held on t r u s t
f o r s a l e does not seem to have caused any problems and a similar
provision could be made for s e t t l e d land.

D. Specific S e t t l e d Land A c t problems

3.15 Complexity. Perhaps t h e g r e a t e s t difficulty of t h e Settled

Land Act 1925 is i t s sheer complexity. Three different aspects will serve
to illustrate this.

(i) The Act always requires t h e use of at l e a s t t w o

documents, t h e vesting deed which vests t h e legal estate
in t h e t e n a n t for l i f e (or whoever is entitled to exercise
his powers) and t h e t r u s t instrument which declares t h e
trusts.” If land is acquired a f t e r t h e s e t t l e m e n t has
been created, a subsidiary vesting deed must b e executed
vesting t h e land in t h e t e n a n t for life (or whoever is
entitled to exercise his powers).22 Hence where t h e r e
a r e frequent purchases of land for a s e t t l e m e n t , t h e r e
may b e a considerable number of vesting deeds. There
a r e no equivalent provisions for t r u s t s for sale. The
deed which vests t h e land in t r u s t e e s for sale may also
d e c l a r e t h e trusts, or t h e r e may be t w o s e p a r a t e
23
documents where t h a t i s convenient.

(ii) The Settled Land A c t 1925 does not only provide for t h e
straightforward s e t t l e m e n t of a life i n t e r e s t followed by
i n t e r e s t s in remainder. It also covers a wide range of
conditional interests and determinable fees, and land

21 S e t t l e d Land A c t 1925 ss. 4, 5.

22 Ibid., s.10.

23 Law of Property A c t 1925, s.27(1): t h e purchaser is not concerned

with t h e trusts.

10
 conveyed to infants. Here, t h e r e is no tenant for life in
t h e proper sense and t h e Act has to make e l a b o r a t e
provisions giving certain people all t h e powers of t h e
24
t e n a n t for life.

(iii) Because t h e Act applies in certain circumstances

without this being appreciated by t h e settlor, i t can
happen t h a t no t r u s t e e s a r e appointed by him. Thus a
simple g i f t of land t o X for life remainder to Y c r e a t e s
a s e t t l e m e n t and i t is necessary for t r u s t e e s t o be
appointed. Again this necessitates complex provisions
as to who a r e to be t h e t r u s t e e s where none a r e
25
appointed.

3.16 Conflict of interest. I t has been suggested t h a t t h e r e is a n

inherent conflict involved in t h e position of t h e t e n a n t for life.
The legal
estate and all t h e powers of dealing with i t a r e vested in him and under
s.16 of t h e Settled Land A c t 1925 h e is a trustee. Yet h e is, at t h e s a m e
time, t h e principal beneficiary. While i t is quite usual for a t r u s t e e to be
a beneficiary, given t h e lack of any other restraints on t h e tenant's
powers, t h e conflict may become real. I t seems t h a t where t h e r e is a
conflict of interests, t h e t e n a n t for l i f e is not t r e a t e d like a n ordinary
trustee. I t has been held t h a t t h e court will not intervene if t h e t e n a n t
for l i f e allows t h e estate to become derelict, but only if t h e r e is evidence
t h a t h e has refused to exercise his powers.26 Thus t h e remaindermen
may inherit an e s t a t e much diminished in value and have no remedy.
Similarly t h e interests of t h e remaindermen may b e adversely a f f e c t e d by
a sale of t h e s e t t l e d land at a low price. Again, they may have no

24 S e t t l e d Land A c t 1925, ss.20-24.

25 S e t t l e d Land A c t 1925, ss. 30-34.

26 R e Thornhill's Settlement [1941] Ch. 24.

11
e f f e c t i v e remedy27 as they may not discover t h e s a l e until years a f t e r i t
took place and, even if they could establish a breach of trust, the t e n a n t
f o r life may be dead and his e s t a t e not worth suing. While i t is clear t h a t
t h e courts, recognising t h e risks arising from conflicts of interest, usually
make t h e purchase of trust property by a t r u s t e e virtually impossible,28 in
one case where t h e tenant for life purchased t h e settled land without t h e
29
proper procedure being adopted, t h e s a l e was simply allowed to stand.

E. Trust for sale - specific problems

3.17 Co-ownership. The Law of Property A c t 1925 imposes a
s t a t u t o r y t r u s t for s a l e wherever land i s conveyed to co-owners - whether
in equity t h e y a r e joint t e n a n t s or t e n a n t s in common.30 Thus, wherever
a couple buy a house, they become t r u s t e e s for sale of i t although a sale is
probably not what they intend. In 1925, owner-occupation of dwellings
was f a r less usual, than nowadays, and where i t did exist, i t was less likely
t h a t a house would be purchased in joint names.’l T h e co-ownership
envisaged by t h e Law of Property A c t would have arisen in a different
context, where, for example, property was l e f t to children in equal shares.
In such a case, a sale at some s t a g e was likely. A s f a r as co-ownership is
concerned, a system devised for one set of social circumstances is being
used for very different circumstances.

3.18 The doctrine of conversion. The doctrine of conversion states

t h a t where land is held on t r u s t for sale, t h e i n t e r e s t s of t h e beneficiaries
a r e deemed to b e i n t e r e s t s in t h e proceeds of sale, even before before t h e

27 England v. Public Trustee (1967) 112 5.3.70.

28 P e t t i t t , Equity and t h e Law of Trusts, 5th ed., 1984,pp 374-376.

29 R e Pennant’s Will Trusts [1970] Ch. 75.

30 Law of Property A c t 1925, ss.34, 36.

31 Co-ownership arises when t w o or more people r e n t property, as

would have been more usual in 1925, but most of t h e problems s e e m
to occur when t h e co-owners own t h e fee simple or a long lease.

12
land has been sold. The doctrine developed during t h e 18th century.32 In
t h e early cases, t h e n a t u r e of t h e beneficial interests was in question
because t h e law of inheritance differed depending on whether property
was real or personal. The doctrine of conversion meant t h a t land held on
t r u s t for sale devolved as personalty. When reform of land law was being
considered, i t was t h e doctrine of conversion t h a t made t h e t r u s t for sale
a useful tool in t h e simplification of conveyancing: since t h e interests
were not in t h e land anyway, i t was easy to provide t h a t a purchaser
should t a k e f r e e of them.33 Now, however, t h e doctrine of conversion
causes problems. To say t h a t a person with an equitable joint tenancy or
a n equitable tenancy in common has no interest in t h e house but only an
interest in t h e proceeds of sale, when no sale is contemplated, is wholly
artificial. The c o u r t s have refused to allow t h e doctrine of conversion to
o p e r a t e fully in some cases.34 The position therefore now is t h a t t h e
doctrine of conversion applies for some purposes but not for others,
depending on t h e particular circumstances. This is clearly
unsatisfactory.

3.19 Powers conferred by 5.30 of t h e Law of Property Act 1925.

Problems have arisen with s.30 of t h e Law of Property Act 1925 as t o who
c a n apply, under t h e section t h e e x t e n t of t h e powers of t h e court and t h e
f a c t o r s to be taken into account in exercising t h e court's discretion. On
t h e face of it, t h e section only enables a n application to b e made if t h e
t r u s t e e is refusing t o sell. However t h e c o u r t s have found ways of
protecting beneficiaries who wish to prevent a sale.35 I t also appears

32 Lightwood, 'Trusts for Sale,' (1927) 3 C.L.J.59.

33 S e e Fourth Report of t h e Acquisition and Valuation of Land

Committee, Cmd. 424, 1919, especially Appendix IV P a r t I, t h e
Memorandum by B.L. Cherry.

34 e.g. Williams & Glyn's Bank v. Boland [I9811 A.C. 487.

35 See, e.g. Bull v. Bull119551 1 Q.B. 234.

13
t h a t a t r u s t e e who has no beneficial interest in t h e land may b e unable to
apply, so t h a t t h e section does not provide a remedy where t h e t r u s t e e s
36
cannot a g r e e to a sale.

3.20 While t h e c o u r t is given power to make such order as i t thinks

fit, i t is not c e r t a i n whether this extends to ordering one co-owner who
has sole occupation to pay a n occupation r e n t to t h e o t h e r who is not in
o c ~ u p a t i o n . ~I ~t is probably desirable t h a t they should have power to do
a possible solution to t h e problem t h a t where a sale is
so, as t h i s provides
refused because of t h e wishes of one co-owner, t h e other is deprived of a
valuable financial asset.

3.21 A considerable amount of case law exists as to how t h e

discretion should b e exercised. Generally t h e c o u r t will look at t h e
purpose for which t h e t r u s t was c r e a t e d , and see whether t h e purpose still
exists.38 Particular difficulties have arisen as to t h e weight to b e given
40
to t h e children's interests,39 and where one co-owner i s bankrupt.

3.22 Occupation right. I t is not clear whether a tenancy in

common confers on beneficiaries as against t r u s t e e s a right to occupy t h e
41
land.

36 S e e Law Reform Committee, 23rd Report, para. 3.63.

37 S e e further para. 8.10.

38 R e Buchanan-Wollaston's Conveyance 119391 Ch. 738, E v. E

[1955] I Q.B. 234, Barclay v. Barclay L197012 Q.B. 677.

39 Compare Rawlin s v. Rawlings[l964] P. 398, 419 and Burke v. Burke

[1974] 1 W.L.R. 5 6 3 , 1067.

40 R e Holliday Cl9811 Ch. 405, R e Lowrie [1981] 3 All E.R. 353, and see
n. 113.

41 I t was accepted in v. [1955] 1 Q.B. 234 t h a t t h e y did have

a right of occupation b u t this has been criticised. S e e Crane (1955)
-19 Conv. (N.S.) 146. In Williams & Clyns Bank v. 9119811
A.C. 487 Lord Wilberforce noted Denning L A ' S view in Bull v.
Bull
_ . with approval.

14
3.23 Creation of tenancy in common. I t has been suggested t h a t a
tenancy in common cannot be c r e a t e d informally by, e.g. financial
contributions, because s.34(1) of t h e Law of Property A c t s t a t e s t h a t
undivided shares can only b e c r e a t e d "as provided by t h e Settled Land Act
1925 o r as hereinafter mentioned". The Settled Land A c t 1925, s.36(4)
states t h a t undivided shares can only be c r e a t e d under a t r u s t instrument
or under t h e Law of Property A c t 1925. This means t h a t only expressly
c r e a t e d or statutorily imposed undivided shares can exist. However, t h e
courts seem to have accepted t h e existence of informally created
tenancies in common behind a t r u s t for sale.42 The position could be
clarified by s t a t u t e .

3.24 Severance. The inclusion of a reference in s.36(2) of t h e Law

of Property A c t 1925 t o severing by methods which, before 1926, would
have severed a joint tenancy of personal e s t a t e has been a source of some
confusion, and, as t i m e goes by, i t is increasingly undesirable t o have t o
refer to pre-1926 law. A more detailed discussion of t h e problems of
severance will b e found at para. 16.11.

3.25 Ascertaining the equitable interests. A question which has

c o m e before t h e courts on more than one occasion arises when a house
has been purchased in joint names and t h e purchasers have failed t o make
a n express declaration a s t o t h e n a t u r e or e x t e n t of t h e beneficial
interests. I t is then l e f t t o t h e c o u r t s to investigate this, perhaps years
a f t e r t h e conveyance took place. The principles involved in making such
decisions a r e by no means clear. This problem is considered further at
para. 16.5.

42 See further para. 6.5.

I5
F. Powers of trustees

3.26 The Law Reform Committee has already discussed some

problems relating t o t h e powers of trustees of land and of t h e t e n a n t f o r
life.43 These a r e discussed below in t h e c o n t e x t of our f i f t h proposal.
Two further problems which should be mentioned are:-

(i) Power to mortgage. Where land is held by co-owners,

t h e r e is generally a t r u s t for sale. Trustees for s a l e have t h e
powers of a t e n a n t for l i f e under t h e S e t t l e d Land Act. As
such, they cannot raise t h e initial purchase price by
mortgage.44 This probably does not m a t t e r often, because t h e
co-owners as beneficiaries a r e unlikely to object, and
mortgagees do not in practice do so. However, i t i s one more
illustration of t h e difficulties caused by using a n inappropriate
s t r u c t u r e for co-ownership.

(ii) Power to appoint attorney. Since co-owners are

t r u s t e e s for sale, if t h e r e a r e only t w o co-owners (as is usually
t h e case) one cannot appoint t h e other as his o r her
attorney.45 This causes inconvenience and expense, as a third
party must b e involved. In addition t r u s t e e s should use a
special t r u s t e e form of a t t o r n e y r a t h e r t h a n t h e general one,
and failure to use t h e right form may delay o r invalidate a
46
transaction.

43 Law Reform Committee, 23rd Report, Powers and Duties of

Trustees, Cmnd. 8733.

44 S e e E m m e t on Title, 18th ed., p. 322.

45 Trustee Act 1925, s.25(2), as substituted by Powers of Attorney Act

1971, s.9(2).

46 Walia v. Michael Naughton Ltd, The Times, 1 December, 1984.

16
G. Bare t r u s t s
3.27 Generally, where t w o or more people hold interests in land,
t h e n either t h e Settled Land A c t will apply or t h e r e will be a t r u s t for
sale. However, a bare t r u s t is within neither system, and so is to some
e x t e n t a n anomaly. A bare t r u s t exists when t h e entire beneficial
interest is vested in one person and t h e legal e s t a t e in another. The
t r u s t e e in such a case has no duties other than to obey t h e beneficial
owner, who is, to all intent, t h e real owner. Such a t r u s t may arise, for
example, because land held on t r u s t for several beneficiaries has become
vested in one adult beneficiary, or because land is being held by a
nominee. A more frequent situation which may involve a bare t r u s t
arises where t h e property of any unincorporated association is held on
t r u s t for i t s members by trustees.47 Generally bare trusts do not cause
problems for purchasers, because either t h e purchaser is a w a r e of t h e
equitable interest and investigates to ensure t h e sale is with t h e consent
of t h e beneficial owners, or h e is unaware and t a k e s f r e e of them as a
bona fide purchaser of t h e legal estate for value without notice.
However, t h e overreaching machinery provided by 5.2 of t h e Law of
Property Act 1925 does not apply to bare trusts,48 and t h e r e may be
situations where a purchaser fails to obtain a good title.

Summary

3.28 I t will be seen from t h e preceding paragraphs t h a t many of t h e

problems spring from t h e existence of t w o systems which can e a c h b e
used for much t h e s a m e purpose and y e t have major differences in t h e
way they operate. Added to this is t h e preference t h a t t h e legislation
shows for t h e creation of s e t t l e d land, so t h a t land may inadvertently
c o m e within t h e Settled Land A c t 1925, even though this is inappropriate.

47 Worthing Rugby Football Club Trustees v. Inland Revenue

Commissioners t1985l I W.L.R. 409.

48 Except where t h e bare t r u s t has arisen because a t r u s t for sale has

ended and t h e purchaser buying from t r u s t e e s for sale c a n assume
t h e t r u s t continues, Law of Property Act 1925, s.27.

17
However although i t appears at f i r s t sight t h a t t h e legislation governing
the t w o systems covers all possible situations, i t has become apparent
Bare t r u s t s a r e not c a t e r e d for, and lifetime rights of
t h a t this is not so.
49
residence have only been made to f i t within s e t t l e d land with difficulty.

The Interests which Any System Must Take into Account

4.1 Before looking at a range of possible reforms, i t is important
to establish what kinds of i n t e r e s t s in land a r e involved in any proposals
for reform. The principal interests may be categorised as follows:

(i) successive interests,

(ii) concurrent interests,

(iii) minors' interests,

(iv) t h e i n t e r e s t s of purchasers,

(VI i n t e r e s t s under b a r e trusts.

W e do not consider in d e t a i l in this paper t h e special problems which may

a r i s e where land is held by charities or unincorporated associations. The
s t r u c t u r e of such organisations and t h e rights and duties of their trustees
and members involve questions outside t h e scope of land law. However
land is held on t r u s t by these bodies and where appropriate we do consider
t h e impact of our proposals on them.

4.2 Successive interests. The creation of traditional successive

50may b e less
i n t e r e s t s (e.g. to F f o r l i f e to S for l i f e to G in Tail)
common now t h a n i t was when t h e 1925 legislation was being considered.
Changes in social s t r u c t u r e and the impact of taxation have made t h e
creation of s o m e elaborate s e t t l e m e n t s less a t t r a c t i v e . However,
straightforward s e t t l e m e n t s a r e still much used and i t is essential t h a t t h e

49 S e e also as to co-ownership and t r u s t s for sale paras. 6.4 and 6.5

below.

50 Megarry and Wade, T h e Law of R e a l Property, 5th ed. 1984 p. 410.

18
law provides adequately f o r their creation. Where successive interests
a r e created, t h e t e n a n t for life and t h e remainderman both have interests
in t h e land. To some extent, their interests may conflict, as t h e t e n a n t
for life may wish to maximise what he receives, t h a t is, t h e income,
whereas t h e remainderman is interested in t h e security and maximisation
of t h e capital which h e will eventually receive. Any system must b e able
to balance t h e s e conflicting interests. In addition, t h e t e n a n t for life,
being exclusively entitled to t h e income, may have a claim to be more
closely involved with t h e management of t h e property than any other
beneficiary of a trust. In making proposals for reform, it is important
not t o lose sight of o n e of t h e main reasons for t h e present systems within
which and no one person has complete control, t h e r e is a danger t h a t it
will be impossible for anyone to deal with t h e land effectively. The
powers t h a t t h e t e n a n t for life or t h e trustees f o r sale now have avoid this
problem, and this advantage must be retained.

4.3 Concurrent interests. F a r more usual than successive

interests a r e concurrent interests. H e r e a r e two problems. One is to
determine t h e n a t u r e and s i z e of t h e beneficial interest. The other is to
provide a means of settling disputes between beneficiaries as to t h e use of
t h e property, and its disposition whether by sale, lease, mortgage, etc.
Any system must ensure t h a t i t is possible for a purchaser to know
whether or not t h e persons with whom h e is dealing c a n give him a good
title.

4.4 Minors. W e do not propose making any alteration in t h e

rule t h a t a minor cannot hold a legal estate in land. It is essential t h a t
special consideration should be given to a suitable form of t r u s t of land
f o r minors where a minor h a s a n interest in land and t h e r e a r e neither
succcessive nor concurrent interests. In addition, while in general if it is
desired t o give land t o a minor, a t r u s t or s e t t l e m e n t will be created, it is
necessary to make provision for those occasions where a n a t t e m p t is made
to convey a legal estate in land to a minor.

19
4.5 Purchasers. An important aim of any reform of this a r e a
should b e t h e simplification of conveyancing. Hence t h e effect of any
reform on purchasers is a vital consideration. Because of t h e need to
protect purchasers, while we hope t h a t our review of this a r e a will b e
wide-ranging, we a r e not intending to propose any alteration to t h e
fundamental principle of t h e 1925 property legislation, t h a t t h e r e should
b e only t w o legal estates in land. W e consider t h a t this aspect of t h e
1925 legislation has worked well, and t h a t other i n t e r e s t s should b e
c r e a t e d in equity behind a trust. From t h e point of view of purchasers, i t
is essential t h a t they should b e a b l e to establish who has t h e power to sell
and convey t h e legal title, t h a t they should be able to discover any
beneficial interests which cannot b e overreached, and t h a t t h e y should be
c e r t a i n t h a t if they pay their money t o t h e proper persons, they will
obtain a good title, f r e e from overreachable equitable interests.

4.6 Bare trusts. It, is useful in some situations for t h e legal estate
and equitable i n t e r e s t to b e separated even though t h e t r u s t e e has none of
t h e usual duties of a trustee. I t is important t h a t any proposed change
should not make such a separation impossible. I t should make provision to
ensure t h a t purchasers of such land c a n obtain a good t i t l e f r e e from t h e
equitable interest.

Outline of Proposals for Reform

5. I The remainder of this paper will present five different

approaches to reform in this area. They a r e not all mutually exclusive -
s o m e could b e combined. The first, however, is intended to stand alone.
I t is a proposal for a complete reform of this a r e a involving not only t h e
repeal of t h e S e t t l e d Land A c t 1925 but t h e creation of a new t r u s t of
land with a power of sale which would be used for both successive and
concurrent interests. T h e second i s t h e less radical proposal t h a t t h e
S e t t l e d Land A c t should b e repealed, and all successive interests be
c r e a t e d behind a t r u s t for sale. The third is a proposal t h a t t h e S e t t l e d
Land A c t b e retained, but t h e burden of proof shifted so t h a t a s e t t l e m e n t

20
would b e assumed to have been c r e a t e d behind a t r u s t for a sale unless
specific provision were made t h a t i t should not be. The fourth proposal
could be combined with either t h e second or t h e third, and i s t h a t a form
of co-ownership should b e devised which would not, at least initially,
involve a t r u s t at all.
The f i f t h proposal is for a s e r i e s of individual
reforms which resolve particular difficulties in t h e operation of settled
land and t r u s t s for sale without altering t h e basic structure. These
reforms could be combined with any of t h e previous three.

PROPOSAL I

A New Trust of Land

6.1 If t h e dual system is regarded as unwieldy, one possible

solution is to c r e a t e a new t r u s t of land. This t r u s t of land would not be
a t r u s t for sale. The t r u s t e e s would hold t h e land on t r u s t with a power
t o sell and a power t o retain. The trustees would have t h e legal e s t a t e
and would be able t o convey i t to a purchaser f r e e from t h e equitable
interests which arise under t h e trust.

6.2 The proposed new t r u s t would apply in a l l t h e situations where

at present land is either s e t t l e d under t h e S e t t l e d Land Act 1925, or a
s t a t u t o r y t r u s t for sale is imposed by t h e Law of Property Act 1925. It
would t h e r e f o r e be possible to repeal both t h e Settled Land Act and those
provisions of t h e Law of Property Act which r e l a t e to s t a t u t o r y or other
t r u s t s for sale.

6.3 I t is necessary to consider separately each of t h e situations

where under t h e present law land is e i t h e r s e t t l e d or held on t r u s t for
sale, to s e e how t h e new t r u s t would a f f e c t them.

6.4 CO-owners. The a u t o m a t i c imposition of a t r u s t for sale on

co-owners who may have purchased t h e property for their own occupation
is highly artificial and difficult to explain to a lay client. As has been
s a i d , t h e s t r u c t u r e of co-ownership laid down in 1925 is no longer suitable

21
f o r modern conditions. Under this proposal, land held by co-owners would
b e held on trust, but t h e r e would b e no duty to sell. Since t h e r e i s no
duty to sell, t h e doctrine of conversion would not be applicable, as this
doctrine depends on t h e r e being a duty to sell, with equity assuming t h a t
t h e sale has taken place, even when i t has not.

6.5 A t present, although i t is c l e a r t h a t t h e 1925 legislation was

intended to impose a t r u s t for sale in all cases of beneficial co-ownership,
t h e r e a r e some circumstances which i t did n o t expressly cover. These
51
a r e identified by Megarry and Wade as follows:-

(i) a conveyance to A (an infant) and B (an adult) as t e n a n t s

in common;

(ii) a conveyance to A and B as joint tenants, where equity

requires them to t a k e as beneficial t e n a n t s in common,
e.g. because they a r e partners, or contribute purchase-
money in unequal shares;

(iii) a conveyance to X purchasing as t r u s t e e for A and B‘who

a r e equitable owners in common of t h e purchase-money;
and

(iv) a declaration by A as sole owner, t h a t h e holds on t r u s t

f o r himself and B in equal shares.

In addition t h e courts have assumed t h a t where land is purchased in t h e

name of one person alone, and another person contributes to t h e purchase
price, t h e land is held by t h e sole legal owner on t r u s t for sale for himself
and t h e other person who ~ o n t r i b u t e d . ~ ’ W e would suggest t h a t c l e a r
provision should be made so t h a t wherever concurrent i n t e r e s t s in land a r e
c r e a t e d , t h a t land should b e held under t h e new trust.

51 Megarry and Wade, T h e Law of Real Property, 5th ed., 1984, p. 438.

52 Bull v. Bull [1955] I Q.B. 234, Williams & Glyn’s Bank L t d v. Boland
r19811 A.C. 487.

22
6.6 -
Minors. A t present, land conveyed to a minor is
automatically s e t t l e d land under t h e Settled Land A c t 1925.53 T h a t Act
has never provided a really satisfactory solution to t h e problem of land
being held by a minor. The A c t is best suited to t h e situation where a
t e n a n t for life manages t h e land. Where t h e tenant for life is a minor,
this is impossible, and t h e A c t has to make special provision a s to who is
t o exercise t h e powers. Normally, t h e trustees of t h e s e t t l e m e n t hold
t h e legal estate and exercise t h e powers.54 Under t h e new t r u s t , t h e
t r u s t e e s would hold t h e land and have t h e powers of management, and
t h e r e would be no need for special provision. The proposal would
therefore not have a g r e a t deal of practical effect where a minor is
entitled to land, but i t would simplify t h e present position.

6.7 Successive interests. I t is where successive interests have

been c r e a t e d t h a t t h e proposal will make t h e most difference to t h e
interests of those involved. A t present, t h e legal estate in such cases is
generally held by t h e t e n a n t for life who has all t h e powers of disposition
and management. The trustees play a limited role until t h e land is
actually sold, when t h e purchase price has t o b e paid to them. Under t h e
proposal, t h e legal estate would be held by t h e t r u s t e e s who would prima
f a c i e have all t h e powers. The details as to how t h e interests of t h e
t r u s t e e s and beneficiaries would be a f f e c t e d a r e discussed further below.

6.8 Entailed interests. I t seems t o us t h a t entailed interests,

which since 1925 have been able to exist in equity only, a r e a n
anachronism. W e put forward for consideration t h e proposition t h a t
existing entails could be converted into fee t a i l e s t a t e s and t h e creation
of new entailed interests could b e forbidden. Entailed interests as a t
present constituted a r e in some ways misleading. They give t h e

53 The conveyance i s t r e a t e d as a c o n t r a c t to s e t t l e t h e land on t h e

minor, S e t t l e d Land A c t 1925, s.27.

54 S e t t l e d Land A c t 1925, s.26.

23
impression t h a t t h e land will necessarily be kept in t h e family, whereas in
fact t h e entail c a n nearly always b e barred. Even if i t is not, t h e t e n a n t
intail c a n sell t h e land, so t h a t i t is only t h e capital sum which will pass
down t h e family. W e a r e supported in this view by Megarry and Wade
who state:-

Entails might well have been abolished in 1925, along

with t h e old rules of inheritance. They a r e now l i t t l e more
than a nuisance, accompanied by much i n t r i c a t e law. I t is
t r u e t h a t entails played a n important part in t h e old-fashioned
t y p e of s t r i c t settlement. But such s e t t l e m e n t s a r e o u t of
favour today, and w e r e not of paramount importance even in
1925. Very similar results can be obtained, if indeed they a r e
desired, by simpler forms of t r u ~ t s . 5 ~

6.9 Conditional and determinable fees. The Settled Land A c t

1925 includes in i t s scope land held in fee simple or for a t e r m of years
absolute subject to a n executory gift over and land held for a base or
determinable fee. Under this proposal, t h e t r u s t e e s would hold t h e legal
estate in such land and have t h e powers of disposition and management.
In t h e s e cases at present t h e t r u s t e e s a r e likely to have little, if any, role
and t h e r e may well b e cases of determinable fees where t h e r e a r e no
trustees. So f a r as existing s e t t l e m e n t s a r e concerned, we set o u t
proposals l a t e r which should go some way to solving t h i s problem. We
consider t h a t such i n t e r e s t s a r e likely in any e v e n t to b e rare, and t h e
gain, so f a r as simplification is concerned, from treating them in t h e s a m e
way as other f o r m s of successive interest should not be lost by treating
them as a special case.

6.10 Although such interests, according to t h e S e t t l e d Land Act,

exist in equity only, t h e effect of s.7 of t h e Law of Property A c t 1925 (as
amended by Law of Property (Amendment) A c t 1926) i s t h a t a fee simple
which is subject to a legal or equitable right of e n t r y or re-entry is a f e e
simple absolute, and hence a legal e s t a t e . Although t h e r e does seem to

55 Megarry and Wade, T h e Law of R e a l Property, 5th ed., 1984, p.

1151.

24
be some conflict between t h e s e t w o Acts, i t has always been assumed t h a t
t h e Law of Property A c t provision prevails. The Law of Property A c t
provision was introduced to prevent land subject t o a rentcharge from
coming within t h e Settled Land Act. The Rentcharges A c t 1977 will
eventually (by 2037) abolish all rentcharges except those which come
within t h e Settled Land Act, estate rentcharges, and rentcharges imposed
E s t a t e rentcharges developed as a
by s t a t u t e , or by order of t h e court.
way of avoiding some of t h e difficulties of enforcing positive
covenants.56 Were a comprehensive system of land obligations to be
produced, it should be possible to d r a f t a provision t o have e f f e c t a f t e r
2037 so t h a t a l l conditional and determinable f e e s would exist only behind
a trust.57 For t h e present, however, i t s e e m s t h a t only those conditional
and determinable f e e s which do not come within s.7 would be able to
c o m e within t h e new trust.

6.11 Family charges. The only reason why land charged, whether
voluntarily or in consideration of marriage or by way of family
arrangement, with t h e payment of any sums for t h e benefit of any person
is at present t r e a t e d as s e t t l e d land is to provide a convenient way in
which t h e land c a n be sold and t h e vendor t a k e f r e e from t h e charge. I t
does seem rather complicated to subject t h e whole of an a r e a of land t o a
t r u s t when i t may b e only charged with a relatively small sum. Our
proposal would e x a c e r b a t e this problem: because t h e whole legal estate
would have to be held by trustees. However, this does seem to be t h e
best way of protecting t h e interest of t h e person with a family charge,
while enabling t h e land to be sold or otherwise dealt with. It may be t h a t
at present trustees a r e only appointed when t h e land is t o b e sold. We
would welcome views as t o whether it is necessary to impose a t r u s t at a l l
in such cases.

56 S e e Law Com. No. 127 for a possible solution to this problem,

recommending a new system of land obligations which would include
positive covenants and which would be enforceable against
successors in title.

57 Save for those which exist under t h e School Sites A c t etc.

Implementation of Law Com. No.111 would do much to remove any
remaining difficulties with them.
25
6.12 Charities. By s.29 of t h e S e t t l e d Land A c t 1925, a l l land
vested in t r u s t e e s for charitable, ecclesiastical or public t r u s t s o r
purposes is deemed to b e s e t t l e d land. The t r u s t e e s a r e not to b e t r e a t e d
as s t a t u t o r y owners, but do have a l l t h e powers of a t e n a n t for life. I t is
difficult to see t h e relevance of them not being t r e a t e d a s s t a t u t o r y
owners, because t h e definition of a s t a t u t o r y owner is fundamentally t h e
persons who have the powers of a t e n a n t for life.5* The t r u s t e e s were
simply t o hold t h e land on t r u s t with t h e s t a t u t o r y powers which would b e
provided under this proposal, nothing would be lost. A t present, t h e
purchaser must ensure t h a t necessary consents have been obtained -this is
a n exception to t h e general principle of t h e 1925 property legislation t h a t
purchasers d o not have to look behind t h e trusts, and we would welcome
views as to whether i t is necessary.

6.13 Intestacy. A t present, land forming p a r t of a n intestate's

estate is subject to a t r u s t for sale.59 However, land forming p a r t of a
testate estate is not, unless a t r u s t for sale is imposed by t h e will.
Instead, executors a r e given all t h e powers of t r u s t e e s for sale in
disposing of or managing t h e land.60 Where intestacy is concerned,
despite the wording of t h e s t a t u t e , i t appears t h a t t h e administrator does
not really hold t h e land on t r u s t for sale because t h e beneficiaries do not
receive a beneficial interest, and t h a t generally t h e administrator is using
t h e powers under s.39 of t h e Administration of E s t a t e s A c t 1925 r a t h e r
than holding t h e land on t r u s t for s a l e under s.33. However, this does not
render s.33 totally unnecessary, as t h e e f f e c t of s.33(2) is t h a t undisposed
of money is used f i r s t to provide for t h e payment of any pecuniary
legacies. There does seem to be some uncertainty as to t h e precise
relationship between t h e t w o sections. Nor is i t clear whether, at t h e
point t h a t the administrator ceases to deaI with t h e land under s.39 and
becomes a t r u s t e e under s.33, i t is necessary for a n assent to b e executed.

58 Settled Land A c t 1925, s. 117(l)(xxvi).

59 Administration of E s t a t e s A c t 1925, s.33.

60 Administration of E s t a t e s Act 1925, s.39.

26
W e would suggest t h a t t h e law in this a r e a would be improved by making
it clear at what point t h e "initial stage" ends and a n administrator
61
becomes a trustee, and whether it is necessary to e x e c u t e a n assent.
Since w e a r e recommending t h e abolition of t h e statutory t r u s t for sale
for other purposes, i t would c r e a t e a n additional complication if such a
t r u s t were to b e retained for intestacy only. Is it necessary?
Provisionally, w e think not. While i t is essential t h a t administrators
should have a power t o sell, t h e r e seems no reason why t h e land should be
subjected automatically to a t r u s t for sale. T h e land could be held on
trust with power t o sell, and t h e administrators given all t h e powers which
such trustees would have. Similarly it would be necesjary to a l t e r t h e
provision with respect to personal property which at present must also b e
sold6' and, again, w e see no reason to impose a duty t o sell.

6.14 Land held by mortgagees. Where trustees have invested trust

money by lending i t on mortgage and t h e mortgaged land becomes vested
in t h e m f r e e from t h e right of redemption, t h e trustees hold t h e land upon
t r u s t for sale.63 I t i s said t h a t this preserves t h e character of t h e
investment as being one of personalty. However, i t i s doubtful whether
today t h e difference between t h e t r e a t m e n t of realty and personalty is
sufficient to make this necessary. Therefore, w e see no reason why such
land should not be held under a t r u s t of land with power t o sell.

6.15 Purchase of land with t r u s t funds. Where trustees of

personalty o r trustees f o r sale of land invest t h e t r u s t funds in t h e
purchase of land, at present they hold i t on trust for sale.64 As t h e main
reason for this provision is t o prevent t h e land coming within t h e Settled
Land Act 1925, once t h a t is no longer possible, t h e r e should be no
objection t o such land being held on t r u s t with power t o sell.

61 A paper considering this problem and others relating to title on

death is in t h e course of being prepared.
62 Administration of E s t a t e s A c t 1925, s.33.

63 Law of Property A c t 1925, s.31.

64 Law of Property A c t 1925, s.32.

27
Is a n express t r u s t needed?
6.16 Where s e t t l e d land i s concerned, i t has been suggested t h a t t h e
65
phrase "limited in trust" means t h a t t h e r e must b e an express trust.
Likewise, where co-ownership is concerned, i t has been suggested t h a t
t h e r e must be a n instrument expressly creating t h e tenancy in common o r
joint tenancy.66 The law in this a r e a is unclear. I t would be desirable if
i t were clarified and if t h e s a m e rule applied to trusts of land however
they arose. W e can see no good reason to insist on an express trust. The
trust-relationship arises from t h e situation itself, because, for example,
successive interests a r e necessarily equitable, as a r e tenancies in
common. Accordingly, in s o m e cases, situations a r e bound t o a r i s e where
t h e legal implications of a transaction a r e not fully understood. This may
particularly occur where a matrimonial home i s acquired. To require a n
express trust, or any particular instrument, would, in such circumstances,
d e f e a t t h e purpose of imposing a trust.

Should t h e express t r u s t for sale be retained?

6.17 Should a s e t t l o r be able to impose a duty t o sell on t h e

t r u s t e e s if h e wishes to? W e would suggest t h a t h e should not. If such a
duty were to b e imposed, t h e question would t h e n arise as to whether a
power to postpone s a l e should necessarily be implied. Indeed this i s t h e
real question at t h e h e a r t of t h e consideration of t h e continuation of the
express t r u s t for sale. If a power to postpone is to b e implied in every
case, we would suggest t h a t t h e r e i s l i t t l e practical point in a n express
t r u s t to sell. Such a t r u s t would have l i t t l e e f f e c t on t h e trustees'
decision to sell or retain and would reintroduce t h e problems of t h e
doctrine of conversion. If t h e power to postpone were not to be implied
by s t a t u t e into every such trust, t h e r e might be t r u s t s where i t was
o m i t t e d and t h e t r u s t e e s w e r e forced into a sale at a t i m e which was

65 Binions v. Evans [19721 Ch. 359. 366.

66 9 v. [I9621 A.C. 696.

28
disadvantageous t o t h e beneficiaries. Even t h e present position, where
t h e power to postpone is implied unless a contrary intention appears is not
entirely satisfactory, because t h e settlor may not realise t h a t c e r t a i n
words h e has used can be interpreted to exclude t h e power and cause
problems for t h e b e n e f i c i a r i e ~ . ~ ’ If our view is not accepted, and
express t r u s t s for sale continue to b e permitted, we would suggest t h a t , to
protect t h e beneficiaries t h e power to postpone sale should be implied
into every such trust, and t h e beneficiaries should be considered to have
interests in t h e land unless and until a sale takes place.

Existing s e t t l e m e n t s and t r u s t s

6.18 When introducing a new system of land holding, one of t h e

most difficult decisions to make is whether i t should apply only t o f u t u r e
s e t t l e m e n t s and co-ownership rights, or whether i t should apply t o all
interests t h a t exist when t h e Act comes into force. The former approach
has t h e advantage t h a t existing arrangements, which may be t h e result of
careful advice, a r e not upset. The new t r u s t of land will involve t h e
t r u s t e e s in having t h e legal estate, so t h a t where a t e n a n t for life at
present h a s t h e legal estate, t h e r e would have t o be a transfer of t h e legal
estate to t h e trustees. However, leaving existing s e t t l e m e n t s alone has
t h e disadvantage t h a t , for a considerable t i m e to c o m e (and even given
t h e rule against perpetuities some s e t t l e m e n t s can l a s t a long time), t h e r e
would not be a dual system but a triple system of s e t t l e d land, t r u s t s for
sale and t h e new t r u s t of land. An immediate change has t h e
disadvantage t h a t a t e n a n t for l i f e who has hitherto had t o t a l control over
t h e land would lose i t overnight. This is a very real problem. However,
we think i t might b e adequately dealt with by provisions relating to
delegation and consents as to which, see below. I t might also be said t h a t
to change existing s e t t l e m e n t s is to d e f e a t t h e settlor’s intention.
However, t h e t r u s t of land is not a t r u s t for sale, and while i t is t r u e t h a t
t h e t e n a n t for life loses some of his powers, we would suggest that, as a

67 Law of Property Act 1925, s.25(1) and see R e Rooke 119531Ch. 716,
R e Atkins’ W.T. [I9741 W.L.R. 761.

29
whole, t h e new t r u s t of land would not be radically different from a
s e t t l e m e n t under t h e S e t t l e d Land Act. W e would particularly welcome
views on this point. Our provisional view is t h a t while a n immediate
change to t h e new system might cause initial difficulties, t h e advantages
in t e r m s of simplification of t h e system a r e overwhelming. If this
proposal proves acceptable, we would envisage a provision so that, on t h e
d a t e t h e A c t comes into force, the legal estate presently vested in t h e
t e n a n t for l i f e would, by s t a t u t e , b e vested in t h e trustees, and i t would
be essential for a purchaser to t a k e a conveyance from t h e t r u s t e e s to
obtain a good title. Transitional provisions would have to deal with
transactions which w e r e between c o n t r a c t and conveyance a t t h a t date.
Provision would have to b e made for s e t t l e m e n t s where, at present t h e r e
a r e no trustees. Some of t h e difficulties which could arise might b e
lessened if t h e t e n a n t for l i f e were t o b e a trustee.68 The adoption of
this proposal might have implications for t h e Land Registry, as t h e
t r u s t e e s might consider they had a duty to register their title, in order to
69
p r o t e c t the t r u s t property.

6.19 While i t seems to us t h a t , where s e t t l e d land is concerned, t h e

balance of advantage does lie in changing a l l s e t t l e m e n t s to t h e new
system, where express t r u s t s for sale a r e concerned, t h e question raises
slightly different issues. T h e effect of a change is t h a t t h e t r u s t e e s lose
t h e duty to sell. I t is difficult to distinguish between those t r u s t s where
t h e s e t t l o r intended t h e t r u s t e e s to b e under a duty to sell and those
t r u s t s where a t r u s t for sale was used as t h e only available form. To
convert t r u s t s of t h e first kind into t h e new t r u s t of land is to a l t e r what
t h e s e t t l o r intended. W e would tentatively suggest t h a t , despite this, a l l
express t r u s t s for s a l e should b e converted. I t will, in practice, b e
impossible to distinguish between t h e t w o kinds of trusts. T h e t r u s t e e s
will still have t h e power of sale, and t h e beneficiaries may, in some
circumstances. b e able to f o r c e a sale.

68 S e e para. 7.6.

69 S e e para. 11.1.

30
6.20 Where a t r u s t for sale’has been imposed by s t a t u t e , then i t
should be converted into a new t r u s t of land so t h a t t h e t r u s t e e s lose t h e
duty t o sell. The benefits of t h e new t r u s t s where co-owners a r e
concerned have already been discussed7o and i t seems important t h a t all
co-owners should obtain these benefits.

Trustees

7.1 Successive interests. The present provisions a s to who shall

b e t h e t r u s t e e s of s e t t l e d land a r e elaborate. They a r e not s e t out here,
but a r e contained in s.30 of t h e Settled Land Act 1925. In addition, t h e
provisions of s.36 of t h e Trustee Act 1925 apply, laying down who has t h e
right to appoint new trustees.71 I t seems t o us t h a t under t h e new trusts
of land, such elaboration should not b e necessary. The trustees should b e
t h e persons appointed by the settlor to be t h e trustees, and if, in t h e case
of a s e t t l e m e n t c r e a t e d by will, no t r u s t e e s have been appointed, as at
present t h e personal representatives of t h e settlor will act as trustees
until new t r u s t e e s a r e appointed. I t is unlikely t h a t t h e r e will b e no
t r u s t e e s of an inter vivos trust. To constitute t h e trust, either t h e
settlor must declare himself a trustee, or t h e t r u s t property must be
vested in trustees. Section 36 of t h e Trustee Act 1925 should continue to
apply where new t r u s t e e s a r e to be appointed. Under s.30(l)(v) of t h e
S e t t l e d Land A c t 1925, those who together a r e entitled to t h e beneficial
interests a r e able to appoint t r u s t e e s if none (other than t h e personal
representatives of t h e s e t t l o r ) a r e available under t h e other parts of t h e
section.72 Beneficiaries of a t r u s t for sale have no such express power.
However, t h e S e t t l e d Land A c t power is really a recognition of t h e f a c t

70 S e e para. 6.4.

71 Trustee Act 1925, s.64.

72 R e Spearman 119061 2 Ch. 502.

31
t h a t if all t h e beneficiaries a r e ascertained and of full age, t h e y could
bring t h e s e t t l e m e n t t o a n end.73 Similarly, t h e beneficiaries could bring
a t r u s t for sale to a n end, and while they have no power to appoint a new
trustee, t h e knowledge t h a t they can end t h e t r u s t should influence those
who do have t h e power of a p p ~ i n t m e n t . ~I t~should be pointed o u t t h a t i t
is probably unusual for all t h e beneficiaries of a t r u s t to b e ascertained,
and of full age, except where t h e t r u s t arises through co-ownership. It
seems t o us t h a t i t might be useful to add to s.36 of t h e Trustee Act 1925
so f a r as t h e t r u s t s of land a r e concerned, a provision t h a t , where a l l t h e
beneficiaries a r e ascertained and of full age, they should, acting
unanimously, be able to appoint a new t r u s t e e or trustees. Such a
provision recognises t h e strong position of such beneficiaries. There
seems no reason why t h i s power should not apply t o a l l trusts, and not just
to t r u s t s of land. However, t h i s raises m a t t e r s beyond t h e scope of this
paper. W e consider t h a t t h e power should t a k e priority over t h e right of
remaining t r u s t e e s to appoint bearing in mind t h a t t h e beneficiaries could
end t h e trust. Purchasers do not have to enquire as to whether t h e
75
trustees have been properly appointed.

7.2 Where land is held on t r u s t because i t has been conveyed or

devised to a minor,76 t h e above provisions would apply, so t h a t e i t h e r t h e
grantor or t h e t e s t a t o r should appoint trustees. If a t e s t a t o r fails to do
so, then his personal representatives will b e t r u s t e e s for t h e t i m e being.
If a grantor fails to do so, t h e n t h e conveyance should be t r e a t e d as a
declaration of t r u s t in favour of t h e minor.

73 Saunders v. Vautier (1841) 4 Beav. 115.

74 Although i t does not always do so, R e Brockbank cl9481 Ch. 206.

75 Trustee A c t 1925, s.38.

76 S e t t l e d Land Act 1925, s.27.

32
7.3 Where land i s conveyed t o co-owners, t h e provisions of s.34(2)
of t h e Law of Property A c t 1925 should continue t o apply so t h a t t h e land
would be t r e a t e d as if i t had been conveyed to t h e four first named in t h e
conveyance as joint t e n a n t s to hold i t on trust for all those named in t h e
conveyance. They would not, of course, b e holding i t on t r u s t f o r sale,
but on t h e new statutory trust. T h e provisions of s.36 of t h e Trustee A c t
with t h e amendment suggested above, should continue t o apply where new
trustees a r e t o b e appointed.

7.4 Where t h e trust arises on intestacy, t h e administrators would

be t h e trustees as a t present.

Powers of trustees

7.5 Powers. A t present, t h e powers of a t r u s t e e for sale a r e

decided by reference t o t h e powers of a t e n a n t for life. The powers of
t h e t e n a n t for life, as set out in t h e Settled Land A c t 1925, a r e extremely
complex without being comprehensive. The starting-point for t h e powers
of t h e t e n a n t for l i f e was a situation where t h e t e n a n t for l i f e had
virtually no powers ta deal w i t h t h e legal estate. During t h e 19th
century, his powers w e r e gradually increased, with powers t o deal with
particular situations being added bit by bit. The result i s not appropriate
to a modern trust. In particular, when applied to trusts for sale, they d o
not give t h e trustees power to raise t h e purchase price of t h e land by
mortgage. The Law Reform c o m m i t t e e have recommended7’ certain
alterations to t h e powers of t h e t e n a n t for life. While w e a g r e e t h a t
these amendments would go a long way towards improving t h e present
situation, w e consider t h a t a simpler solution might b e found by a more
radical reform of this area. I t s e e m s to us t h a t trustees could b e given
a l l t h e powers over t h e land of a n absolute owner. To d o so is not to put
t h e beneficiaries at t h e mercy of t h e trustees, because trustees always
have to exercise their powers f o r t h e benefit of t h e trust. Any list of

77 Law Reform Committee, 23rd Report, Cmnd. 8733, paras. 8.1-8.10

and see Appendix C.

33
powers is almost bound to have omissions or to become unsuitable with
t h e passing of time. W e understand t h a t i t is common practice to give
trustees f a r greater powers than they a r e given by s t a t u t e in any event.
The question t h a t then arises is whether a s e t t l o r should be able to limit
t h e powers of t h e trustee. Is i t essential t h a t t h e r e should be someone
with an unfettered power of sale? W e doubt if t h e conditions which gave
rise t o this being a m a t t e r of such importance in t h e past still exist today,
and we t h e r e f o r e very much doubt whether any such provision is necessary
provided t h a t t h e position of purchasers is protected. We will be grateful
for any views on this point. I t may b e t h a t t h e suggested extension of t h e
powers of t r u s t e e s should only apply to trusts imposed by s t a t u t e , as, for
example, where t h e r e is co-ownership, and not to express trusts.

7.6 Tenant for l i f e a s a trustee. Where t h e r e is a t e n a n t for

life,78 one of t h e disadvantages of t h e proposed new t r u s t is t h a t t h e
t e n a n t for l i f e would no longer have t h e powers of disposition and
management t h a t h e has at present. That this is not a n overwhelming
disadvantage is demonstrated by t h e preference shown for t h e creation of
t r u s t s for s a l e rather t h a n s e t t l e d land. However, i t may be a problem in
some cases. Increased powers of delegation” may assist, but one other
idea is to give t h e t e n a n t for life a right to b e appointed as a trustee.
This would give him a d i r e c t voice in t h e management of t h e property,
while t h e other t r u s t e e s (there would have to b e at least one other if t h e
land were to be sold) would ensure t h a t t h e i n t e r e s t s of o t h e r
beneficiaries were protected. The right to b e appointed as t r u s t e e should
not apply if t h e s e t t l o r excludes it, nor should i t apply if t h e r e a r e already
four trustees.

78 While not at this s t a g e attempting a n exhaustive definition of who

would be a t e n a n t for life, we envisage including most of those at
present given t h e powers of t h e t e n a n t for life by t h e Settled Land
A c t 1925.

79 See para. 8.2.

34
7.7 Duty t o act unanimously. The Law Reform C o m m i t t e e h a s
considered" t h e question as to whether t h e rule t h a t trustees must act
unanimously except where t h e s e t t l e m e n t contains power to act by a
majority, is a satisfactory one. They concluded, and w e a g r e e with their
conclusion, t h a t t h e rule is satisfactory and should remain. I t is
apparently r a r e for power to act by a majority decision t o b e conferred in
t h e settlement, and t h e Law Reform C o m m i t t e e thought it significant
t h a t this particular rule is usually retained. It should be noted t h a t t h e
e f f e c t of t h e rule will no longer b e t h a t one t r u s t e e c a n f o r c e a sale;81
instead, subject t o application to t h e court under s.30 of t h e Law of
Property A c t 1925, one t r u s t e e would be able to prevent a sale. Since
t h e r e would be no duty to sell but only a power t o sell, a l l t h e trustees
would have t o a g r e e to a sale. Removing t h e emphasis on sale is
arguably a major change but one which f i t s in with t h e general t h e m e of
this proposal.

Beneficiaries

8.1 Should t h e beneficiaries of t h e new t r u s t have any special

rights over and above those rights which t h e beneficiaries of any trust
have?82 W e have already discussed t h e possibility t h a t where t h e r e is a
t e n a n t for life, h e should have a right to be a trustee.

8.2 Delegation. The present provisions relating to delegation by

t h e t r u s t e e s a r e rather limited. Under s.29 of t h e Law of Property A c t
1925, t h e trustees may delegate to t h e life-tenant t h e powers of and
incidental to leasing, accepting surrenders of leases and management.
Delegation must be in writing and is revocable. T h e delegated powers
are exercised in t h e n a m e of t h e trustees, but t h e life-tenant is liable for

80 Ibid., para. 3.60.

81 As for example, in R e Mayo 119431 Ch. 302.

82 A s to which see Hanbury and Maudsley Modern Equity 12th ed.,

1985, pp. 493-495.

35
any breach of trust, t h e t r u s t e e s a r e not. If t h e t r u s t e e s refuse to
delegate, t h e life-tenant can apply t o t h e court who may order t h e
trustees to delegate.83 W e would suggest t h a t where an existing
s e t t l e m e n t is converted into t h e new t r u s t on t h e coming into force of
these provisions, and t h e t e n a n t for life has, a t t h a t d a t e , t h e legal estate
and t h e powers of a t e n a n t for l i f e under t h e S e t t l e d Land Act, t h e r e
should be a s t a t u t o r y irrevocable delegation of t h e trustees' powers of
management, including t h e power of sale, to t h e t e n a n t for life. The
t r u s t e e s should not be liable for t h e life-tenant's exercise of these powers.
They have no choice over delegating them.

8.3 Where a new s e t t l e m e n t is c r e a t e d a f t e r these provisions c o m e

into force, or a new t e n a n t for life becomes entitled, t h e discretionary
power to delegate should continue to exist and should be extended so t h a t
t h e t r u s t e e s c a n delegate all their powers, including t h e power of sale.
However, t h e t o t a l exclusion of t h e trustees' duty seems unnecessarily
wide, and t h e r e should b e b e t t e r provision t o ensure t h a t t h e interests of
other beneficiaries a r e not damaged. Where t r u s t e e s employ agents, t h e
Law Reform C o m m i t t e e has recommendedg4 t h a t t r u s t e e s should have a
duty to exercise a general supervision over t h e agent. The wording
suggested there is not appropriate here because the trustees'
discretionary powers a r e being delegated, and not merely t h e carrying-out
of specific acts. I t is probably already t r u e that, in deciding whether to
delegate, t r u s t e e s already a r e under a duty to t a k e into account t h e
i n t e r e s t s of t h e remaindermen. This could b e extended so t h a t t h e
t r u s t e e s c o m e under a duty t o exercise a continuing general supervision
over t h e t r u s t property in order to safeguard t h e interests of t h e other
beneficiaries. I t has been a criticism of t h e s e t t l e d land system t h a t t h e
remaindermen have had too l i t t l e p r o t e c t i ~ n . ~The
~ proposed system of

83 Law of Property Act 1925, s.30.

84 Ibid., para. 4.1 1.

85 England v. Public Trustee (1967) 112 S.J. 70.

36
delegation would give t h e t e n a n t for life s o m e control, while providing
better protection for t h e remaindermen. The courts should continue t o
be able t o order delegation in appropriate cases if t h e trustees refuse.

8.4 We would envisage t h a t delegation would operate in t h e s a m e

way as delegation under s.25 of t h e Trustee Act 1925, except t h a t t h e
delegation need not be limited to twelve months. Delegation would thus
be by power of attorney and as under s.25 t h e trustees would continue to
be liable for t h e acts or defaults of t h e donee of t h e power. W e would
welcome views as to how capital monies received by t h e t e n a n t for life
when exercising his delegated power should be treated. I t is clearly
important t h a t t h e interests of any remaindermen a r e adequately
protected. In this connection w e would welcome information as t o how
delegation under s.29 of t h e Law of Property A c t 1925 and under s.25 of
t h e Trustee A c t 1925 works. A t present i t seems t o us t h a t t h e t e n a n t
for life could receive t h e money. The remaindermen would be protected
by t h e continuing liability of t h e trustees.

8.5 Consent t o sale. I t is one of the paradoxes of the present

system t h a t i t is impossible for a settlor to restrict t h e power of sale of a
t e n a n t for l i f e of settled land,86 but possible to make t h e sale of land held
on t r u s t f o r sale subject to consents. The policy of t h e Settled Land A c t
1925 was t o ensure t h a t land was not made inalienable, but t h e provisions
relating to trusts for sale do not seem t o have caused any g r e a t
difficulties. T h e court has a power t o order a sale where a consent is
refused.87 W e suggest t h a t t h e power of sale under t h e t r u s t should be
capable of being made subject to t h e consent of o n e or more persons.
There should be a provision equivalent t o s.30 of t h e Law of Property A c t

86 Settled Land A c t 1925, s.106.

87 Law of Property A c t 1925, 5.30.

37
1925 where consent is refused. A purchaser should, a s at present, only
have t o ensure t h a t t h e consents of not more than t w o people have been
obtained, even if more a r e required by t h e t r u s t deed?' If t i t l e to t h e
land is registered any requirement for consents will b e reflected in t h e
restriction registered to p r o t e c t t h e beneficial interests.

8.6 Consultation. As has been said, t h e present provision relating

to consultation is weak.89 Like t h e s t a t u t o r y power to postpone, i t is
arguable t h a t this duty is a n implicit recognition of t h e inappropriateness
of t h e duty to sell in some of t h e situations where t h e 1925 legislation
imposed one. Once t h e r e is no duty to sell, t h e r e seems less need for any
special provision regarding consultation. The t r u s t e e s have a general
duty to exercise their powers for t h e benefit of t h e beneficiaries. That,
coupled with a n extension of t h e rights of beneficiaries to apply to t h e
might be sufficient protection. However t h e existence of t h e
duty to consult may ensure t h a t t h e beneficiaries a r e a w a r e of some
action by t h e t r u s t e e s so t h a t they c a n t a k e s t e p s to prevent i t before i t is
too f a r advanced. In this respect t h e duty to consult is valuable,
although, in i t s present from, probably too weak t o be of use. If i t is
thought necessary to retain some similar provision, then a more definite
right to be informed as to t h e trustees' f u t u r e actions would be
preferable.

8.7 Rights of residence. The t e n a n t for life of s e t t l e d land

clearly has t h e right to occupy t h e land. That is, generally speaking, t h e
purpose of t h e settlement. Under a t r u s t for sale, t h e position may
depend on whether t h e land i s held on express t r u s t for sale, when t h e r e
may b e no rights of residence?' o r on t h e s t a t u t o r y t r u s t s for sale

88 Settled Land A c t 1925, s.26.

89 S e e para. 3.12.

90 S e e para. 10.10 (iv).

91 Barclay v. Barclay [I9701 2 Q.B. 677.

38
imposed on co-owners, where t h e r e are.92 T h e rights of residence of co-
owners depend on t h e pre-1926 law, and have been t h e m a t t e r of some
dispute. The d i f f e r e n c e between t h e two situations seems to arise
because t h e t r u s t for sale in t h e l a t t e r case is a' mere conveyancing
device, in other words, wholly artificial. Once again, t h e imposition of
an unnecessary duty to sell has made t h e law more complex than i t need
be. W e would suggest t h a t a l l beneficiaries who have present (as opposed
to f u t u r e ) interests in land should have a right to occupy t h e land unless
specifically excluded by t h e settlor or unless t h e t r u s t e e s have been given
discretion to choose which beneficiary can occupy. This would mean t h a t
those entitled on intestacy might acquire rights of residence if t h e
administrators retained t h e property a f t e r t h e "initial stage" referred t o
above.93 While this is probably a change from t h e present position, t h e r e
does not seem anything wrong with t h e result, because such a situation is
likely t o arise where t h e r e a r e infant beneficiaries or a widow with a life
interest. The right of residence should not apply to, for example, rented
property which t h e trustees hold for investment purposes.

8.8 There should be a clear statutory provision giving t h e courts

power to d i r e c t how t h e rights should be exercised.94 A t present, t h e
court varies occupation rights on a n application by one co-owner for a n
order for s a l e under s . 3 0 . ~ ~W e would suggest t h a t in accordance with
our other recommendations for broadening t h e scope for 5.30, a
beneficiary should b e able to apply for t h e rights of occupation to b e
varied, even if he is not applying for a sale.

92 -
Bull v. Bull Cl9551 1 Q.0. 234.

93 S e e para. 6.13.

94 Such a jurisdiction would not be entirely novel, as t h e courts already

vary rights of occupation under t h e Matrimonial Homes Act 1983
and t h e Domestic Violence and Matrimonial Proceedings A c t 1976.
The Matrimonial Homes Act 1983, s . l ( l l ) clearly assumes t h a t
equitable co-owners do have rights of occupation.

95 Dennis v. McDonald [19821 Fam. 63.

39
8.9 The s e t t l o r should b e able t o exclude t h e right of residence if
h e so wishes. The right of residence would b e capable of being
overreached if t h e land were sold and t h e purchase price paid to at least
two t r u s t e e s or a +rust corporation. Once a sale took place t h e
beneficiaries would no longer have any interest in t h e land and would thus
have no right of residence in it. I t is important to make this point so t h a t
i t is not thought t h a t t h e right of residence we propose is a new s e p a r a t e
right, capable of subsisting on i t s own. W e a r e merely suggesting t h a t
t h e present law should be clarified to make i t clear t h a t one aspect of
being t h e beneficiary of a t r u s t of land may b e having t h e right to occupy
it, just as a beneficiary has t h e right to b e consulted, or t h e right to
receive t h e t r u s t income.

8.10 Occupation rents. If e a c h beneficiary has a right to occupy,

should t h e courts have t h e power t o order, for example, one co-owner to
pay money to t h e other in respect of t h a t o c ~ u p a t i o n ? ~ ~T h e present
97
law is discussed at some length at f i r s t instance in Dennis v. McDonald,
where Purchas J. accepted t h a t , "the t r u e position under t h e old
authorities was t h a t t h e Court of Chancery and Chancery Division would
always be ready to inquire into t h e position as between co-owners being
t e n a n t s in common either at law or in equity to see whether a t e n a n t in
common in occupation of t h e premises was doing so to t h e exclusion of
one or more of t h e other t e n a n t s in common for whatever purpose or by
whatever means. If this was found t o b e t h e case, then if in order to do
equity between t h e parties an occupation r e n t should b e paid, t h i s would
b e declared and t h e appropriate inquiry ordered. Only in cases where t h e
t e n a n t s in common not in occupation were in a position to enjoy their
right t o occupy but chose not to do so voluntarily, and were not excluded
by any relevant factor, would t h e t e n a n t in common in occupation b e
entitled to do so f r e e of liability to pay a n occupation rent." However, i t

96 There is a s t a t u t o r y power to do so in respect of married couples,

Matrimonial Homes A c t 1983, s.1(3).

97 [1982] Fam. 63, at pp. 70-71.

40
appears t h a t such a power t o require payment of a rent only exists if t h e
situation is one where t h e court would have power t o order a sale.98 The
question t h a t arises is whether this power should be placed on a statutory
footing, or whether i t is best t o leave t h e court with t h e widest powers
possible under a re-drafted s.30. The advantage of legislating is, as
always, t h a t it would bring g r e a t e r certainty, and so make settlements o u t
of court more likely. T h e disadvantage in this particular case is t h a t t o
bring greater certainty, one would have to define, with some precision,
t h e situations in which a n occupation r e n t could be paid, and to do so
would restrict what is at present a broad jurisdiction. In addition, one
might have to lay down principles on which t h e r e n t i s t o be calculated, a
m a t t e r on which t h e r e is relatively l i t t l e law.99 Should i t be related to
t h e market rent, or t o t h e fair r e n t as if a tenancy of t h e dwelling were
regulated under t h e R e n t A c t 1977 or t o t h e "reasonable rent" as if i t
w e r e a restricted contract? An alternative measure might be t h e
income lost to t h e non-occupier through not being able t o invest t h e
money h e would have received had t h e property been sold. The
circumstances in which t h e r e n t might be ordered to be paid seem t o be so
varied t h a t any a t t e m p t at precise definition i s likely to lead to unjust
results. Accordingly, w e suggest t h a t , at most, t h e r e should be a
provision along t h e lines t h a t t h e occupation r e n t should, so f a r as
equitable and practicable, compensate a beneficiary for his loss of
occupation rights.

8.1 I Quite a p a r t from t h e payment of a n occupation rent it seems

right t h a t t h e r e should be provision, similar to t h a t in s.1(3)(c) of t h e
Matrimonial Homes A c t 1983, to t h e e f f e c t that, where appropriate, a
court c a n impose obligations regarding repair, maintenance, and discharge
of liabilities in respect of t h e property. I t is probably t r u e t h a t a court
c a n already d o this under s.30 of t h e L a w of Property A c t 1925, but
clarification might be a n advantage.

98 S e e Bernard v. Josephs 119821 Ch. 391.

99 S e e Dennis v. McDonald [I9821 Fam. 63, at p.80.

41
Position of Third P a r t y

9.1 PurchaserslO' should find their position much improved by t h e

new scheme. Where land is at present s e t t l e d under t h e S e t t l e d Land Act
1925, they have to t a k e a conveyance from t h e t e n a n t for life, but pay t h e
money to t w o trustees. As has been seen, they may be in difficulties if
t h e s e t t l e m e n t has, in fact, ended. Under t h e new scheme, as under a
t r u s t for s a l e now, a purchaser will t a k e his legal t i t l e from t h e t r u s t e e s
and, providing t h e money is paid to at least t w o of them, o r to a t r u s t
corporation, t h e interests of t h e beneficiaries will b e overreached."' The
beneficiaries will t h e n have i n t e r e s t s in t h e proceeds of sale and not in
t h e land.

9.2 If t h e money is paid to only one t r u s t e e and t h a t t r u s t e e is not

a t r u s t corporation, t h e position will b e as at present, in t h a t t h e i n t e r e s t s
of t h e beneficiaries will not b e overreached. If t h e t i t l e to t h e land is
not registered, a bona fide purchaser for value will t a k e f r e e of t h e
i n t e r e s t s if h e has no notice. l o 2 If t i t l e is registered, h e will as at
present t a k e f r e e unless e i t h e r t h e interest is protected on t h e register by
e n t r y of a restriction or caution, or a beneficiary is in a c t u a l occupation
and so has a n overriding interest. 103

9.3 Another third party who may become involved i s a judgment

creditor. A t present, a judgment creditor may obtain an interest in land
by obtaining a charging order on t h e debtor's interest. The Charging
Orders A c t 1979 covers any i n t e r e s t in land held on trust, and no
amendment would b e necessary.

100 By which we include lessees, mortgagees and any o t h e r person who

acquires a n i n t e r e s t in t h e land.

101 Law of Property A c t 1925, s.2.

102 I t should be noted t h a t a n i n t e r e s t behind a t r u s t is not capable of

registration under t h e Land Charges A c t 1972.

103 Land Registration A c t 1925 s.70(l)(g).

42
9.4 Under s.17 of t h e Settled Land Act 1925, where t h e estate
owner ( t h a t is, t h e person with t h e legal estate) holds t h e land f r e e from
other equitable interests under a t r u s t instrument, t h e t r u s t e e s a r e bound
t o e x e c u t e a deed declaring they a r e discharged. A purchaser can t h e n
assume t h e land is no longer s e t t l e d land. There is no comparable
provision for t r u s t s for sale. The provisions of s.17 cannot b e adopted in
their e n t i r e t y for t h e new t r u s t because they assume t h a t t h e legal e s t a t e
is held by someone who is beneficially entitled. Trustees for sale already
have a duty, if requested by a beneficiary entitled to have t h e legal e s t a t e
vested in him, to transfer t h e legal e s t a t e to t h e beneficiary. Where t h e
proceeds of s a l e a r e held in t r u s t for persons of full age in undivided
shares absolutely, those persons can require t h e trustees to vest t h e land
in them as joint tenants on t r u s t for sale.lo4 What is required is t h a t t h e
t r u s t e e s should b e given a power so to convey and a duty to e x e c u t e a
deed of discharge which would protect a purchaser.

9.5 If t h e proposal in para. 6.18 were adopted, viz. t h a t all s e t t l e d

land should be converted i n t o land held on t h e new trust, t h e position of
mortgagees of t h a t land would require consideration, a s would t h e position
of t h e t e n a n t for life where h e h a s mortgaged t h e t r u s t land. There is no
reason why t h e remedies of t h e mortgagees which a r e exercisable against
t h e land, for example, taking possession or appointing a receiver, should
not continue t o be exercisable. The only difference would be t h a t as t h e
legal estate would be vested in t h e trustees, i t would be necessary to
bring proceedings against them. But what of t h e personal liability of t h e
t e n a n t for life? Unless t h e r e a r e express powers in t h e s e t t l e m e n t t h e
t e n a n t for life can only mortgage t h e legal estate for c e r t a i n purposes
connected with t h e settlement. I t is therefore arguable t h a t his
personal liability should cease once h e loses t h e legal estate. However,
this might prove unacceptable to mortgagees and we do seek views as t o
what transitional provisions might be made to cope with this problem.

~ ~ ~~-

104 Law of Property A c t 1925, s.3(l)(b)(ii).

105 Settled Land A c t 1925, s.71.

43
Powers of t h e Court

10.1 A t present, m a t t e r s affecting a t r u s t of land may c o m e before

t h e court under s.64 of t h e Settled Land Act 1925, 5.57 of t h e Trustee Act
1925, s.30 Law of Property A c t 1925 or in t h e exercise of i t s inherent
jurisdiction.lo6 In addition, of course, t h e court has jurisdiction to deal
with breaches of trust. We a r e not intending to make any
recommendations relating to t h e inherent jurisdiction of t h e courts or
their powers over t r u s t e e s who a r e in breach of their duty. These
m a t t e r s a r e t h e s a m e for all trusts and have no special significance for
t r u s t s of land. However, t h e other sections will require some amendment
if t h e y a r e t o f i t in with t h e proposed scheme.

10.2 Section 64 of t h e S e t t l e d Land Act and s.57 of t h e Trustee Act

a r e similar sections which give t h e c o u r t power to permit, in t h e case of
s.64, a t e n a n t for life, and in t h e case of s.57, t h e trustees, to do
something which would otherwise b e outside their powers. Section 57 has
no application to s e t t l e d land. W e would suggest t h a t if this proposed
scheme is implemented so t h a t t h e legal estate is held by t h e trustees, t h e
provisions of s.64 would be unnecessary because s.57 would provide t h e
court with adequate powers t o assist in all cases. 107

10.3 The limitations of s.30 of t h e Law of Property Act 1925 have

already been referred to, but i t is useful here to draw together t h e issues
relating to t h i s section in order to produce a coherent proposal. There
a r e t w o issues involved in any examination of s.30. First, under what
circumstances and by whom c a n an application be made, and secondly,
what powers should t h e court have and under what conditions should t h e y
be exercised?

106 As, for example, in R e Duke of Norfolk's S e t t l e m e n t Trusts [19821

Ch. 61.

107 The Variation of Trusts A c t 1958 applies if a permanent additional

power is required.

44
10.4 I t might be suggested t h a t i t is unnecessary t o confer special
powers on t h e court where trusts of land a r e concerned. Where other
trusts a r e concerned, t h e courts can and will act t o restrain a breach of
trust, but t h e courts do not normally interfere with t h e exercise of
discretion by t h e trustees unless their discretion is so exercised t h a t t h e
exercise of t h e discretion is itself a breach of t h e trust. Why is a special
power needed? I t is probably t r u e t h a t where express trusts a r e
concerned, t h e trustees a r e managing investments for t h e benefit of a
number of beneficiaries, and disagreement among t h e trustees to t h e
point where they c a n no longer o p e r a t e t h e trust is unlikely. Even if such
disagreement were to exist, t h e solution would probably be for some of
t h e trustees t o r e t i r e and, in t h e meantime, t h e effect of the
disagreement would be unlikely materially t o a f f e c t t h e interests of t h e
beneficiaries. However, where trusts of land arising out of co-ownership
a r e concerned, t h e trustees and t h e beneficiaries a r e likely t o be one and
t h e same. T h e case law shows t h a t all too o f t e n disputes c a n arise as t o
t h e occupation of t h e t r u s t property, and failure t o a g r e e may lead t o one
or m o r e of t h e trustees or beneficiaries being homeless. Therefore, in
this area, t h e courts have found i t necessary t o interfere with t h e
exercise of t h e trustees' discretion.

10.5 T h e present provision enables any person interested to apply t o

t h e court to force a sale or to make t r u s t e e s exercise a power. I t does
not enable anyone to apply to prevent a sale o r t o prevent t h e exercise of
a power. Where t h e trustees a r e acting in breach of trust, a beneficiary
c a n apply t o t h e court anyway and special statutory provision is
unnecessary. However, t h e e f f e c t oi s.30 i s to allow t h e c o u r t to act
where t h e r e is no breach of t r u s t and to substitute i t s own discretion for
t h a t of t h e trustees. In t h e context of co-ownership, t h e present
restriction on t h e circumstances in which a n application may be made
may not matter, as t h e t r u s t e e who wants to sell will b e unable t o d o so
without his co-trustees' concurrence and so will apply t o t h e court.
However, it is strange t h a t t h e co-trustee cannot initiate t h e proceedings.
W e would provisionally recommend t h a t s.30 be amended so t h a t any
person interested c a n apply to t h e court t o prevent o r t o force t h e
trustees to exercise their powers.
45
10.6 "Any person interested" may not include trustees who a r e not
beneficiaries. Trustees under this proposal would have to act
unanimously in order t o sell a s they have a power to sell, not a duty. The
Law Reform C o m m i t t e e has already recommendedlo8 that trustees
should be able to apply to t h e court for a sale, and t h e court could then
override t h e wishes of t h e dissenting trustees. W e a g r e e with this
recommendation, but a r e a b l e t o go f u r t h e r than the Law Reform
C o m m i t t e e who were considering reform of t h e t r u s t for sale only, and we
suggest t h a t a a trustee, like a beneficiary, should be able t o apply e i t h e r
t o force or to prevent a sale.

10.7 A t present, t h e court has power to make "such order as i t

thinks fit". I t appears t h a t this only gives t h e court discretion as to
whether to order a sale and as to t h e t e r m s of t h a t order if i t does order a
sale. lo9 It can also order t h e t r u s t e e s to exercise their power of
delegation or dispense with t h e consent to sale of a beneficiary. It
cannot refuse to order a s a l e and still order a n occupation r e n t to be
paid.

10.8. Once t h e duty to sell has been removed, t h e r e i s no longer any

reason for t h e preference for s a l e which is implicit in t h e t e r m s of s.30.
W e therefore would suggest t h a t any t r u s t e e and any person interested
should be able to apply to t h e c o u r t to prevent o r to f o r c e a sale, to make
t h e t r u s t e e s delegate t h e i r powers, to dispense with t h e consent to s a l e of
any beneficiary, and to vary t h e rights of occupation of t h e beneficiaries.
Coupled with this last power should b e a power to order t h e occupying
beneficiary to pay a n occupation r e n t to t h e other beneficiary. W e have
already discussed t h e difficulties which might a r i s e if a more detailed
provision were made. T h e court should also have power to make a
suspended order.

~~ ~ ~~ ~~ ~

108 Law Reform Committee, 23rd Report, Cmnd. 8733, para. 3.63.

109 Bernard v. Josephs [I9821 Ch. 391, 410, per Kerr L.J.

46
10.9 There i s one further aspect of s.30 which should be considered.
A t present, t h e r e a r e no s t a t u t o r y guidelines as to how t h e court should
exercise i t s discretion. The guidance t o be derived from t h e cases i s
based on t h e assumption t h a t t h e r e is a duty to sell. If t h e court's powers
a r e made wider, then it may seem advisable t o give some guidance as to
how t h e discretion should be exercised. Such guidance would assist in
encouraging s e t t l e m e n t s out of court. Without it, litigation will have t o
t a k e place before i t is known how t h e courts will exercise their wider
powers. What guidelines might be appropriate? Where t h e property in
question is a dwelling and held on trust for co-owners, and has been
occupied by them as a family home, it would seem desirable t o state
explicitly t h a t t h e welfare of any children should be taken into account in
deciding how t o exercise their powers. Arguably, in line with other
legislation, the welfare of the children should be the first
consideration.'" The existing position is unsatisfactory, because while i t
is usual to t a k e their interest into account, some judges have done so
directly, while others say t h a t t h e interests of t h e children can only
a f f e c t t h e outcome in so f a r as they a f f e c t t h e equity of o n e of t h e co-
owners.'" lt will be necessary to find a suitable definition of "relevant
children", because this provision should apply to unmarried as well as to
married couples. Possibly a relevant child should be any child who
occupies t h e dwelling in question and is a child (or has been t r e a t e d as a
child) of any person entitled to occupy by virtue of t h e trust. A common
judicial approach in deciding whether t o order a sale has been to examine
t h e purpose for which t h e dwelling was bought and to order a sale if t h e
purpose no longer exists. This too should b e put on a statutory footing. I t
should not be forgotten t h a t t h e courts may be asked to exercise their
powers where t h e r e a r e successive rights. While this is so at present, t h e
case law refers mostly to disputes between co-owners. Where t h e r e a r e

110 S e e e.g. Matrimonial and Family Proceedings Act, 1984, s.3.

111 See Rawlin s v. Rawlings [I9741 P. 398, Burke v. Burke [I9741 1

W.L.R. 106; Williams v. Williams 119761 C h m

47
successive interests, i t is arguable t h a t if t h e t e n a n t for l i f e wants a sale,
h e should be allowed to have it unless there are exceptional
circumstances. A t present, if successive i n t e r e s t s a r e c r e a t e d under t h e
Settled Land Act, t h e t e n a n t for l i f e can choose when to sell. Under t h e
proposed scheme, he will not b e able to do so unless t h e power has been
delegated to him, although h e may have considerable influence a s one of
t h e trustees. Should t h e court have to give f i r s t preference to t h e
wishes of t h e t e n a n t for life? W e would suggest t h a t t h e t e n a n t for life
should generally be able t o prevent or to force a sale, but t h a t t h e court
should have regard t o all t h e circumstances of t h e case. Where t h e r e a r e
concurrent interests, i t seems sensible t h a t , although t h e court should
have regard to t h e circumstances referred to above, in t h e absence of
special considerations, t h e wishes of t h e majority in value should prevail.

10.10 To sum up, we a r e suggesting t h a t t h e court should have

113
regard to t h e following matters:-

(i) t h e purpose for which t h e property was purchased, so

t h a t if t h a t purpose no longer exists, t h e property should
normally be sold;

(ii) where t h e property i s occupied by co-owners a s a family

home, t h e welfare of any children who occupy and who
a r e t h e children of any person entitled to occupy under
t h e trust;
(iii) t h e wishes of t h e t e n a n t for life;

(iv) t h e wishes of t h e majority in value of those holding

i n t e r e s t s in possession in t h e property.

Having considered a l l these factors, t h e court should s t i l l be able to t a k e

into account other relevant considerations.

112 See para. 7.6.

113 The Insolvency Bill 1985 makes specific provision where an

application is made under s.30 as t h e result of insolvency and we
would therefore suggest t h a t cases covered by t h i s provision should
b e expressly excluded from t h e proposals made here.

48
10.11 I t might be thought odd to have such specific m a t t e r s in a
successor to s.30, y e t t o have suggested t h e removal of t h e right of t h e
beneficiaries t o b e consulted. However, as has been said, t h e existing
right to be consulted is too weak t o be of any g r e a t use. To impose a set
of restrictions similar to t h e above on trustees seems unnecessary. They
a r e liable to t h e beneficiaries if t h e y a c t in breach of trust. Knowledge
of t h e f a c t o r s t h e court may look at will influence their actions. In view
of this, i t seems b e t t e r t o impose t h e guidelines on t h e court, where they
may assist in t h e s e t t l e m e n t of litigation, rather than on t h e trustees,
where they should be less necessary.

Land Registration Implications

11.1 The proposed scheme should greatly simplify t h e position as

regards registered title. Where land is s e t t l e d under t h e Settled Land
Act 1925, either t h e t e n a n t for life, or t h e statutory owners, a r e
registered a s proprietors with different restrictions being entered
depending on whether t h e r e a r e trustees.'l4 Land held on t r u s t for sale is
always registered in t h e names of t h e trustees with a restriction being
entered unless t h e registrar is satisfied t h a t t h e t r u s t e e s a r e beneficially
entitled.'l5 We would propose t h a t a l l land held on t h e new t r u s t should
be t r e a t e d a s land held on t r u s t for sale now.

11.2 W e have already recommended t h a t t h e old and new systems

should not run in parallel so t h a t s e t t l e d land and land held on t r u s t for
sale should be converted into t h e new t r u s t of land. This would make no
difference to t h e registered t i t l e of land held on t r u s t for sale, but where
at present t h e t e n a n t for life i s t h e registered proprietor, i t is necessary
f o r t h e t r u s t e e s to become t h e registered proprietors. I t i s obviously
impracticable for this to be done on t h e initiative of t h e Land Registry,

I14 S e e Ruoff and Roper, Registered Conveyancing, 4th ed., 1979, Ch.
19.

115 Land Registration Act 1925, s.58(3).

49
who would not know t h e names of t h e t r u s t e e s and for whom i t would be a
huge administrative task. I t is also unrealistic to e x p e c t every t e n a n t for
life to e x e c u t e a transfer to t h e trustees. I t would b e possible to ask
t r u s t e e s to register themselves as proprietors. However in cases where
t h e t i t l e to s e t t l e d land is registered t h e r e is a duty to e n t e r a
restriction, and t h e restriction will always name t h e t r u s t e e s unless t h e r e
a r e none.'l6 Where t h e t r u s t e e s a r e named, i t would b e possible to deem
t h e m to b e t h e registered proprietors with a u t o m a t i c vesting and
divesting of t h e legal estate and powers of di~position.'~' In other cases,
t h e best solution s e e m s to be to make t h e change when t h e r e is a
registered disposition or charge of t h e land. I t could be provided that, as
in unregistered land, only t h e t r u s t e e s c a n give the purchaser a good t i t l e ,
and where t h e t e n a n t for life is a registered proprietor (and t h e
restriction will show t h a t h e is only a t e n a n t for life), a special form could
be used whereby, in one transaction, h e would transfer his t i t l e to t h e
t r u s t e e s and t h e t r u s t e e s would transfer i t to t h e purchaser."' Similarly,
if t h e land was to b e charged, t h e procedure would make it c l e a r t h a t t h e
t r u s t e e s had t h e power to do so, and t h e opportunity would b e taken to
make t h e m t h e registered proprietors. The t e n a n t for life would be
placed under a duty to e x e c u t e t h e necessary documents. Where t h e
powers had been delegated to a beneficiary, we would suggest t h a t t h e
t r u s t e e s should remain t h e registered proprietors, b u t should have a duty
to e x e c u t e any documents which a r e necessary for t h e beneficiary to
exercise his delegated powers. 119

116 Land Registration A c t 1925, 5.86 and Land Registration Rules 1925,
rr 56-59 and Forms 9-11.

117 Although t h i s information may be o u t of date.

118 Possibly, t h i s could be e f f e c t e d by a declaration by t h e t r u s t e e s as

to t h e circumstances of t h e transaction, and this would b e sufficient
for t h e purchaser to become registered as t h e proprietor, c p
Administration of E s t a t e s Act 1925, s.36(6).

119 Although t h i s would not b e necessary i t t h e t r u s t e e s granted t h e

t e n a n t for life a power of attorney.

50
Conclusion

12.1 W e hope t h a t t h e preceding paragraphs have demonstrated

t h a t t h e r e would b e advantages in creating a new t r u s t of land which
would fulfil both t h e functions of t h e Settled Land Act and t h e functions
of t h e t r u s t for sale. Such a single system would have t h e obvious
advantage of g r e a t e r simplicity than t h e present dual system. One
disadvantage of t h e proposal is t h a t i t removes t h e a u t o m a t i c entitlement
of a t e n a n t for life (often t h e person who occupies t h e land and currently
has t h e g r e a t e s t interest in i t ) t o have t h e legal estate vested in him alone
and to exercise complete control over t h e land. The t e n a n t for life,
acting alone, is likely to b e able to make quicker, though not necessarily
better, decisions than t h e t r u s t e e s who must a g r e e a course of action.
However, in practice t h e S e t t l e d Land Act is, we think, very l i t t l e used.
Indeed, one of t h e m a t t e r s on which we particularly seek information i s
We a r e also a w a r e t h a t t h e administration
t h e e x t e n t of i t s c u r r e n t use.
of very large s e t t l e d estates may involve d i f f e r e n t factors, and we would
welcome information as t o t h e e x t e n t to which t h e Settled Land A c t 1925
is still used, for them and whether t h e introduction of this proposal or any
aspect of i t would cause particular problems for large estates. One other
aspect of this proposal which might be seen as a disadvantage in principle
is t h a t i t does involve some substantial re-writing of t h e 1925 property
legislation. W e need to be very s u r e t h a t such a major change would be a
change f o r t h e better. W e t h e r e f o r e s e e k comments or criticisms on a l l
aspects of t h i s proposal.

PROPOSAL I1

Conversion of All S e t t l e m e n t s to Trusts for Sale

13.1 I t has been suggested120 t h a t t h e best way to solve t h e

problems caused by t h e dual system is to repeal t h e S e t t l e d Land A c t 1925
so t h a t a l l s e t t l e m e n t s a r e c r e a t e d behind a t r u s t for sale. For t h e

120 S e e Cheshire and Burn's Modern Law of Real Property, 13th ed.,
1982, p. 205.

51
purposes of t h e discussion we assume t h a t t h e existing t r u s t for sale is
adopted virtually unaltered. W e do not believe t h a t in fact this measure
would effect any g r e a t change in t h e way in which s e t t l e m e n t s a r e
generally ordered. Many s e t t l e m e n t s which could now be c r e a t e d under
t h e S e t t l e d Land Act a r e not, and t h e t r u s t for sale form is used.
However, it would no longer be possible to give the t e n a n t for life t h e
unfettered powers which h e has at present although delegation would be
possible. His position is discussed f u r t h e r below. Where a person
c r e a t e s a n inadvertent s e t t l e m e n t by granting rights of occupation for life
to someone in his will, at present t h a t person as t e n a n t for life is entitled
to t h e legal estate and has full power to deal with t h e land. The fact t h a t
in such a situation t h e t e s t a t o r may have failed to make a n express
appointment of trustees is unlikely to m a t t e r until t h e point at which t h e
land is due to b e sold. Under this proposal, i t would be essential for
t r u s t e e s to b e appointed, as they must hold t h e legal estate and manage
t h e land. This should not be a problem as provision could be made so t h a t
executors of t h e will a r e t h e t r u s t e e s if no o t h e r s have been appointed.
As such, t h e y would continue to hold t h e legal estate they obtained in
their capacity as executors. Thus, t h e new system should be simpler
where such inadvertent s e t t l e m e n t s a r e created, because t h e r e will b e no
need for a conveyance of t h e legal estate to t h e t e n a n t for life. Similar
problems should not a r i s e with inter vivos settlements, as e i t h e r t h e
s e t t l o r must declare himself to b e a t r u s t e e or t h e land must be vested in
trustees. This is not to say t h a t inadvertent s e t t l e m e n t s cannot be
c r e a t e d inter vivos - t h e y can, and t h e problems caused by t h e m a r e
121
discussed below.

Existing s e t t l e m e n t s

13.2 Existing s e t t l e m e n t s could be allowed to continue in their

present form, or they could be converted into t r u s t s for sale. The
problem with allowing t h e m to continue in their present form is t h a t

~ ~~ ~

121 See para. 16.16.

52
s e t t l e m e n t s c a n last for a considerable time, and thus a n a r e a of law t h a t
had otherwise disappeared would linger on. To convert them into trusts
for sale may, however, do violence to t h e intention of t h e settlor, i.e. h e
may have intended t h a t t h e t e n a n t for life should have t h e legal estate
and a l l t h e powers of disposition and management. Further, t h e settlor
may not have intended t h e land t o be sold. Although under t h e Settled
Land A c t 1925 i t is always possible for t h e land to be sold, t h a t i s rather
different from t h e position under a trust for sale where t h e primary duty
of t h e trustees is t o sell. T h e legal estate would have to be transferred
from t h e t e n a n t for life to t h e trustees, and t h e t e n a n t for l i f e would lose
his powers. These problems could be ameliorated by making t h e sale of
t h e land subject t o t h e consent of t h e t e n a n t for life, and deeming t h e
trustees t o have made a n irrevocable delegation of their powers under
s.29 of t h e Law of Property A c t 1925. With t h e s e measures, we do not
think t h e r e would be any g r e a t objection to converting a l l settlements
into trusts for sale, and i t would be a g r e a t advantage to g e t rid of t h e
dual system in one go.

T h e t e n a n t for l i f e
13.3 A change to a system which relies exclusively on trusts for
sale would remove power from t h e hands of t h e t e n a n t for l i f e and place
it with t h e trustees. T h e existing system of settled land was intended t o
enable t h e t e n a n t f o r life, who might well occupy t h e land, t o m a k e t h e
decisions about it. A s t h e person most closely interested, h e would have
t h e necessary knowledge to manage t h e land well. I t may b e said t h a t
giving t h e legal estate to t h e t r u s t e e s i s distancing management decisions
from t h e land itself. T h r e e answers may be given to this point. In t h e
first place, it may be t h a t t h e r e a r e now f e w settlements of t h e kind
where t h e t e n a n t f o r l i f e occupies a n estate, and so t h e problem may not
be a real one. Secondly, if it does exist, it may be alleviated by providing
t h a t a sale can only t a k e place with t h e consent of t h e t e n a n t for l i f e and
by strengthening t h e power t o delegate. A t present, t h e settlor can make
t h e sale of land subject to a t r u s t for sale dependent on t h e consent of o n e
or more of t h e beneficiaries. I t may be t h a t where t h e r e is a t e n a n t for
life (of course, not all settled land involves a t e n a n t for life), t h e r e should

53
be an a u t o m a t i c requirement t h a t t h e s a l e is subject to t h e consent of t h e
t e n a n t for life. Thirdly, t h e position of t h e t e n a n t for life as t h e
principal beneficiary and sole t r u s t e e arguably involves a n unacceptable
I22
conflict of interests, and is harmful rather than beneficial.

13.4 As to delegation, we make below s o m e general suggestions for

altering t h e power to delegate. Here, t h e question is whether t h e
position of a t e n a n t for life could be strengthened by a n extension of t h e
power to delegate. I t would be possible to make provision for wider
delegation than t h a t provided by s.29 of t h e Law of Property A c t 1925.
All powers of t r u s t e e s could be capable of being delegated, both before
and a f t e r land i s sold. A t present, powers relating to t h e t r u s t fund can
only b e delegated for t h e very limited period provided by s.25 of t h e
Trustee Act 1925. We would s e e no objection t o such a n extension,
provided t h a t i t were accompanied by t h e measures suggested below to
ensure t h a t t h e remaindermen a r e protected. Could t h e duty to sell be
delegated as well? I t would b e possible to f r a m e a provision t o this
e f f e c t , but we think i t would be undesirable in principle. I t is one of t h e
fundamental principles of t r u s t law t h a t a t r u s t e e cannot delegate his
duties. The requirement t h a t a t e n a n t for life should have to consent t o
a s a l e should b e sufficient to give him some influence in t h e decision. The
t r u s t e e s will necessarily have t o b e involved in a sale, since they have t h e
legal estate. The beneficiaries do, in any event, have t h e power to apply
to court to f o r c e a sale. 123

Purchasers

13.5 From t h e point of view of purchasers, t h e system has t h e

advantage t h a t they obtain a conveyance from t h e t r u s t e e s and pay t h e
purchase-money to those trustees. Purchasers no longer have to see a

122 S e e para. 3.16

123 Law of Property A c t 1925, s.30.

54
special vesting deed. The change would remove t h e danger which exists
at present t h a t t h e purchaser may t a k e a conveyance from a person who is
no longer entitled.124 I t also removes t h e doubts t h a t do exist about t h e
e x t e n t of t h e protection which a purchaser receives under s.lIO(2) of t h e
Settled Land A c t 1925.

Trustees

13.6 For trustees, t h e change would mean a n increase in their

duties. They would have t o t a k e primary responsibility for managing t h e
estate. This would cause no problems for new trusts for sale, but where
existing s e t t l e m e n t s a r e concerned, i t might be t h a t existing trustees
would b e unwilling or even unsuitable to be involved in this more onerous
task, or, more likely, t h a t t h e charging clauses in t h e original s e t t l e m e n t
would prove inadequate. The f i r s t problem can be solved by employing
agents as permitted by s. 23 of t h e Trustee Act 1925 or by permitting t h e
t r u s t e e s t o retire. T h e second can be solved by giving t h e court s t a t u t o r y
power to increase t h e charges. Arguably, t h e court already has this
power,125 but in this instance a clear statutory power would seem
desirab1e.

Powers of t h e court

13.7 In Proposal I we considered widening t h e powers given t o t h e

court by s.30 of t h e Law of Property Act 1925. Some of t h e suggestions
made t h e r e would not b e appropriate here, because if t h e land i s held on
t r u s t for s a l e i t seems right in principle t h a t t h e court should lean in
favour of a sale in t h e e v e n t of dispute. Therefore t h e r e is not such a
strong c a s e for providing guidelines for t h e exercise of t h e court's
discretion. However, t h e other suggestions made t h e r e as to t h e widening
of t h e range of those who can apply, enabling trustees or beneficiaries t o

~ ~~-

124 Stone, "A S e t t l e d Land A c t problem revisited", [I9841 Conv. 354.

125 R e Duke of Norfolk's S e t t l e m e n t Trusts [I9821 Ch. 61.

55
apply to s t o p a s a l e as well as to enforce one, and clarifying t h e law
relating to occupation r e n t s would all, we think, b e changes which should
be looked at in t h e context of this proposal.

CO-owners

13.8 Under t h i s proposal co-owners would, as at present, hold t h e

land on t r u s t for sale for themselves as beneficiaries. I t may b e thought
t h a t this is undesirable and f o r t h a t reason Proposal I or IV may b e
preferred. However, retaining t h e present system has t h e advantage t h a t
t h e system is reasonably well known, and with t h e changes suggested to
s.30 i t would work adequately. I t might be desirable to clarify t h e
situations where a t r u s t arises, to include those where t h e r e a r e beneficial
co-owners but only o n e legal owner.126 I t would arguably be improved if
t h e suggestion discussed a t para. 16.5 et seq. were adopted with t h e result
t h a t where t h e r e is no express declaration of t h e beneficial interests, t h e
beneficial interests will be presumed to follow t h e legal interests with t h e
result t h a t t h e co-owners will be joint tenants in equity as well a s joint
t e n a n t s in law.

Registered t i t l e
13.9 The proposal would make s e t t l e m e n t s easier to o p e r a t e where
t i t l e to land i s registered. I t would work in t h e s a m e way as t h e t r u s t of
land in Proposal I so t h a t t h e t r u s t e e s would always be t h e registered
proprietors. Similar provisions would have to be made for t h e transfer of
t h e legal t i t l e from t h e t e n a n t for life to t h e trustees.

Conclusion

13.10 The advantage of this proposal is t h a t i t simplifies t h e law by

repealing parts of t h e S e t t l e d Land A c t 1925, while at t h e s a m e t i m e
making use of a well-known and understood structure, t h e t r u s t for sale.

126 S e e para. 6.5.

56
By making use of a n existing structure, t h e r e a r e less likely t o be any
unforeseen problems. The disadvantage is t h a t t h e s t r u c t u r e may not
represent what t h e s e t t l o r wanted, since a sale might not have been in his
mind at all and he may have wished t h e t e n a n t for life t o have t h e legal
estate. While at present a settlor cannot prevent a t e n a n t for life from
selling, it might be difficult to explain t o a would-be settlor t h a t t h e
t r u s t e e s would have a duty t o sell although coupled with t h e power t o
retain and subject to any consents t h a t a r e required even though, of
course, t h e r e is a power t o postpone. The existence of t h e power t o
postpone might be said to make t h e t r u s t for sale almost misleading to a
layman. The proposal does l i t t l e t o a l t e r t h e present system of co-
ownership, although i t could be combined with Proposal IV. Unless t h a t
proposal is adopted, one would be l e f t with t h e rather unreal situation
t h a t where t w o or more people buy a house for their own occupation, they
c o m e under a n immediate binding duty to sell it, even though t h e r e is a
power t o postpone which they actually intend to exercise.

PROPOSAL III
Changing t h e Burden o f Proof

14.1 The problem of "inadvertent settlements", t h a t is, s e t t l e m e n t s

where t h e settlor unintentionally subjects his land to t h e regime c r e a t e d
by t h e Settled Land A c t 1925 and so confers on t h e person with a life
interest extensive powers of disposition and almost t o t a l control of t h e
land, could be solved by reversing t h e emphasis of t h e present legislation.
A t present, if land is conveyed in such a way as to c r e a t e successive
interests,127 t h e S e t t l e d Land A c t 1925 automatically applies unless an
immediate binding t r u s t for sale has been expressly imposed on t h e
trustees. I t would be comparatively simple to provide t h a t wherever land

127 Or to c r e a t e any of t h e o t h e r interests set out in s.1 of t h e Settled

Land A c t 1925.

57
was conveyed in such a way as to c r e a t e successive interests, a t r u s t for
s a l e would b e presumed unless specifically excluded. If t h e land had not
been conveyed t o trustees, t h i s would involve t h e appointment of t r u s t e e s
(but this may occur where s e t t l e d land i s c r e a t e d now) and t h e transfer of
t h e legal e s t a t e to them. In o t h e r respects, this proposal would leave t h e
existing Jaw as i t is. I t has t h e advantage of disturbing t h e s t a t u s quo
very little, while going some way to solve some t h e problems c r e a t e d by
t h e dual system. I t could be combined with t h e fourth and f i f t h
Proposals, IV and V.

PROPOSAL IV
A New System of Co-ownership

15.1 The a u t o m a t i c introduction of a trust, especially a t r u s t for

sale, into a simple purchase of land for occupation by t w o people is
something t h a t puzzles t h e layman. I t is not entirely acceptable to t h e
lawyer either, because although trustee-beneficiaries a r e by no means
uncommon, i t i s of t h e essence of a t r u s t t h a t one person i s managing t h e
property for t h e benefit of another. If t h e interests of t r u s t e e s and
beneficiaries a r e entirely identical, t h e n perhaps t h e r e should be no need
for a trust. A s has been said earlier, i t is unlikely t h a t those who framed
t h e 1925 legislation had in mind t h e present situation where t w o people
buy property in joint names for their own occupation. The proposal
considered here i s t h a t we should develop a new form of co-ownership
which would not involve a trust. This form of co-ownership would only
apply where at present t h e legal and equitable interests a r e identical, t h a t
is, t h e land i s owned by joint t e n a n t s holding on t r u s t for themselves as
joint tenants. Where this situation exists, t h e joint owners would simply
be t r e a t e d in t h e s a m e way as a sole owner - t h a t is, they would, together,
have t h e whole legal and equitable i n t e r e s t with no t r u s t interposed
between t h e interests. They would be in t h e position of legal joint
t e n a n t s before 1926 and in t h e s a m e position as legal joint owners of
c h a t t e l s a r e now. This proposal would not apply where one legal owner
holds on t r u s t for himself and another, but only where t h e legal and
equitable interests a r e identical.

58
15.2 The previous paragraph suggests t h a t t h e t r u s t could be
dispensed with where t h e legal co-owners a r e beneficial joint tenants.
What if they a r e beneficial t e n a n t s in common? The problem h e r e is t h a t
t h e Law of Property A c t 1925, s.34 prevents t h e creation of a legal
tenancy in common. T h e r e is therefore necessarily a t r u s t wherever
t h e r e is a beneficial tenancy in common, because t h e legal and beneficial
interests a r e not identical. To bring tenants in common within t h e
proposal would involve reintroducing t h e legal tenancy in common. The
problem with legal tenancies in common, and t h e reason why they w e r e
abolished, is that, e a c h undivided share c a n b e dealt with separately; thus
many people c a n acquire interests in one piece of land and, as they a r e all
legal owners, e a c h one would have t o e x e c u t e t h e deed if t h e land is to be
properly conveyed. '** Land may become unsaleable if one person,
perhaps with only one-hundredth of t h e estate, cannot be traced. We
would welcome views as t o whether t h e problems which were previously
thought t o be caused by legal tenancies in common would exist if such
tenancies w e r e revived. I t s e e m s t o us at first sight t h a t they would.

15.3 I t might b e suggested t h a t this f o r m of co-ownership should be

restricted to t h e situation where t h e land is purchased for occupation by
t h e joint owners. This would limit i t s application and prevent t h e use of
this kind of co-ownership in property bought for investment purposes
where possibly r a t h e r different issues arise. W e seek views on this point,
but at present w e think t h a t any such limitation would cause more
problems t h a n i t would solve. The definition of "occupation" would be
difficult. What of t h e home bought as a country c o t t a g e or the home
bought f o r eventual retirement?

Disputes

15.4 I t would be necessary to provide a procedure by which disputes

relating to t h e management or sale of t h e land could be resolved.

128 S e e example given by A. Underhill in Fourth Report of Acquisition

and Valuation of Land Committee, Appendix I, p.30.

59
However, i t is not entirely easy t o see how such powers should be defined.
When a court makes a decision in a dispute concerning a t r u s t for sale, i t
can analyse t h e purpose of t h e trust, e.g. was i t for sale, was i t t o
provide a matrimonial home, etc., and make i t s decision in such a way as
to fulfil t h e purpose of t h e trust. If t h e r e is no apparent purpose, then
t h e c o u r t can fall back on the f a c t t h a t i t is a t r u s t for sale, and t h e
presumption t h a t t h e property should be sold. If t h e joint owners a r e
simply owners, t h e r e is nothing to analyse. I t therefore seems necessary
t o provide some s o r t of principle on which t h e c o u r t s would decide such
disputes. The Partition Acts g a v e preference to t h e majority, so t h a t if
t h e majority wanted a sale, t h e c o u r t would normally order one, but t h a t
is unlikely t o assist h e r e as generally t h e r e will only be t w o joint owners
and, by definition, they will be equally entitled. Simply t o say t h a t t h e
c o u r t may make such a n order a s i t thinks f i t is not enough, a s i t gives
neither c o u r t s nor litigants any idea a s to what an order is meant t o
achieve.

15.5 A comparison may be made with s.188 of t h e Law of Property

A c t 1925 which gives'the c o u r t power to s e t t l e disputes relating t o jointly
owned ~ h a t t e 1 s . l ~ The
~ joint ownership of c h a t t e l s does not necessarily
involve a trust. I t states:

Where any c h a t t e l s belong to persons in undivided shares, t h e

persons interested in a moiety or upwards may apply to t h e
c o u r t for a n order for division of t h e c h a t t e l s or any of them,
according to a valuation or otherwise, and t h e court may make
such order and give any consequential directions as i t thinks
fit.

I t should be noted t h a t one must have at least a half share to apply and
t h a t t h e only order t h e court can make is one of division of t h e chattels.

129 Law of Property A c t 1925, s.28(3) provides for partition of land held
on t r u s t for sale, and t h e c o u r t c a n order partition, Law of Property
Act 1925, s.30.

60
I t seems t o us t h a t such limited powers would b e inappropriate t o land
where t h e decisions made may a f f e c t t h e owners' housing position and
where i t is more likely t h a t third parties will be involved.

15.6 I t is suggested t h a t any joint owner should be able t o apply to

t h e court, and t h a t t h e court should be given wide powers to make
whatever orders i t thinks fit. W e would also suggest t h a t t h e r e should be
statutory guidelines so t h a t t h e courts should have t o have regard to t h e
following factors and then make such decision as seems just in all t h e
circumstances. T h e f a c t o r s which t h e court should have t o t a k e into
I30
account would be:-

(i) t h e purpose for which t h e land was bought and whether

t h a t purpose still exists;

(ii) where t h e property is t h e family home, t h e welfare of

any children of t h e joint owners;

(iii) where t h e r e a r e more than t w o owners, t h e wishes of t h e

majority in number.

15.7 On sale, t h e joint owners would convey t h e e n t i r e legal and

beneficial interest t o t h e purchaser. I t would b e essential t h a t all t h e
co-owners joined in t h e sale, because t h e r e could be no equivalent to s.27
of t h e Law of Property A c t 1925 which effectively allows t w o o u t of four
(or more) co-owners to sell. N o question of overreaching could arise, as
t h e r e would be no separation of t h e legal and equitable interests. The
purchaser would receive t h e whole interest in t h e property, both legal and
equitable, from t h e co-owners. This raises t h e question of what happens
to t h e purchase-money. Clearly, t h e money must be paid t o (or at t h e
direction of) a l l t h e joint owners, but how is i t t h e n to be held? I t would
be possible f o r t h e money t o b e held in t h e s a m e way as t h e land is. This

~ ~

130 See, f o r further discussion of t h e s e issues, paras. 10.9 and 10.10.

61
would require no alteration in t h e present law, as t h e r e i s nothing t o
prevent personal property being jointly owned without t h e existence of a
t r u s t existence. In t h e e v e n t of dispute, any joint owner could simply
withdraw his s h a r e of t h e money.

Severance
15.8 A s was said earlier, this proposal would probably only apply
where t h e joint tenants hold t h e whole interest in t h e land. T h e right of
survivorship would t h e r e f o r e apply. I t is necessary to provide some
system whereby t h e right of survivorship can b e excluded. This would
involve t w o things, f i r s t a separation of t h e legal and equitable interests,
and secondly, severing t h e equitable joint tenancy. W e would suggest
t h a t a provision should be made so t h a t these t w o e v e n t s could t a k e place
at t h e s a m e time. Severance could t a k e place in t h e usual way, by
serving a written notice, by a n agreement or by dealing with one's share in
a way inconsistent with a joint tenancy. I t would probably b e necessary
to provide t h a t severance would be a u t o m a t i c where one co-owner
becomes bankrupt, so t h a t t h e bankrupt's equitable i n t e r e s t can pass to
t h e t r u s t e e in bankruptcy.

Conclusion

15.9 The advantage of this proposal is t h a t i t seems to simplify t h e

system t h a t applies in t h e very common situation where t w o people
purchase a house or other land, normally for their occupation. They
would no longer be trustees. In practical terms, we wonder whether such
a provision would make much difference to t h e situation of t h e joint
owners. Provision still has to b e made for t h e resolution of disputes and
f o r t h e protection of t h e purchaser on t h e sale of t h e property. A major
advantage might be t h a t it would no longer b e necessary to explain to t h e
layman why h e has to be a t r u s t e e f o r s a l e when a l l h e wanted to be was
a n owner-occupier. One disadvantage is t h a t to introduce a new system
of co-ownership is to add something complicated to our already complex
system of land law without taking anything away, and this might increase
costs. I t would still be necessary to keep t h e t r u s t for sale f o r situations

62
where t h e trustees and t h e beneficiaries a r e not t h e s a m e people or their
estates or interests differ. I t would not be necessary, of course, t o keep
settled land, because either Proposal I or Proposal I1 could be adopted and
t h e Settled Land A c t repealed, at least in part.

PROPOSAL V

16.1 This proposal, unlike t h e previous ones, does not involve any
alteration in t h e structure of trusts of land. Instead, a series of small
changes a r e described which would correct some of t h e difficulties which
prevent t h e present dual systems from working properly. The proposals
a r e not necessarily connected and any one or more of them could be
combined with t h e previous proposals.

Law Reform C o m m i t t e e proposals

16.2 The Law Reform C o m m i t t e e has made numerous proposals

connected with t h e powers of trustees. Some of these a r e relevant t o
t r u s t s of land. W e reproduce at Appendix C a summary of those
proposals which are particularly relevant to trusts of land, and we would
support t h e s e proposals.

16.3 In s o m e respects, w e think t h a t t h e Law Reform Committee's

proposals d o not go f a r enough. Where their recommendation no.37 is
concerned, t h a t t h e r e should be a section corresponding to s. 36(7) of t h e
Administration of E s t a t e s A c t 1925 t o protect t h e purchaser of land which
has previously been subject to a trust for sale, w e would suggest t h a t any
such provision should clarify those situations in which t h e trustees h a v e
power t o convey t h e land in such a way as to end t h e t r u s t for sale. W e
consider t h a t their recommendation no.55 t h a t t r u s t e e s of a s e t t l e m e n t
should be empowered to require a t e n a n t for l i f e t o obtain valuations of
t h e s e t t l e d land before i t is sold, does not go f a r enough to protect t h e
remaindermen, because it is s t i l l n o t clear when it would be a breach of
trust for t h e trustees not to serve t h e notice which they suggest. Thus,
t h e remaindermen might s t i l l be l e f t without a remedy. W e would suggest

63
t h e addition of a requirement t h a t t h e trustees on receipt of a notice
f r o m t h e t e n a n t for life t h a t h e is about to make some disposition of t h e
land,131 should be under a duty to send copies of i t to such of t h e
remaindermen as a r e ascertained and a r e of full a g e and to t h e parents or
guardians of those under age. This would give t h e remaindermen a
c h a n c e to make representations to t h e trustees, and would also give them
t h e opportunity of offering to purchase t h e land if t h e y so desire.

Doctrine of conversion

16.4 W e have discussed earlier t h e artificiality of t h e doctrine of

conversion and t h e confusion t h a t now exists a s to i t s application, so t h a t
interests under a t r u s t for s a l e a r e sometimes i n t e r e s t s in land and
sometimes not. It seems to us t h a t l i t t l e purpose i s served today by t h e
doctrine of conversion, and t h a t nothing would be lost by i t s abolition.
W e would t h e r e f o r e suggest t h a t t h e doctrine be abolished, so t h a t all
interests in land held on a t r u s t for sale a r e interests in t h e land, whether
t h e land is held on a n express t r u s t or a s t a t u t o r y trust. While this
reform on i t s own would not entirely alleviate t h e problem of using t h e
t r u s t for s a l e for co-ownership, where no sale is intended, i t would remove
some of t h e difficulties and i t would be in line with r e c e n t judicial
pronouncements on t h e subject.

Declaration of t h e equitable interests

16.5 A conveyance of t h e legal estate to t w o or more people as

joint t e n a n t s does not o p e r a t e as a declaration t h a t they a r e joint t e n a n t s
in equity as well. T h e beneficial i n t e r e s t s have to b e determined e i t h e r
by a n express declaration of t r u s t or by looking at extrinsic evidence of
t h e intentions of t h e parties and their contributions to t h e purchase.

131 The t e n a n t for life is obliged to serve such a notice, Settled Land
A c t 1925, s. 101.

64
Unfortunately, it is by no means a general practice for t h e r e to be a n
express declaration and even if t h e r e is, t h e courts d o not invariably give
e f f e c t to it.132 If t h e r e is a n express declaration t h e f i r s t question t h a t
arises is whether, if t h e declaration is contained in t h e conveyance or
transfer of t h e dwelling, t h e purchasers must have executed t h e
conveyance or transfer for i t to be a n e f f e c t i v e declaration. I t has been
held at f i r s t instance t h a t they must,L33 and in t h e Court of Appeal t h a t
they need not.13' T h e earlier case was not cited t o t h e Court of Appeal,
where Buckley L.J. said, "I think w e must proceed upon t h e footing f i r s t
t h a t this was a declaration of trust inserted into t h e document at t h e
behest of t h e purchaser or their solicitors; and t h a t t h e legal estate was
vested in t h e purchasers upon t h e trust declared in t h e document." Their
Lordships did not r e f e r to s.53(l)(b) of t h e Law of Property A c t 1925
which says t h a t a declaration of trust of land must be manifested and
proved by writing, signed by some person who is able to declare t h e trust.
However, i t is arguable t h a t s.53(l)(b) has no application where t h e r e is a
conveyance of land to, for example, X and Y as beneficial joint tenants.
X and Y d o not thereby declare themselves t o be trustees; t h e trust is
imposed by statute. If t h e law is unclear, i t is necessary f o r us to
examine what t h e policy should be in order to determine what changes
might be necessary. T h e advantages of requiring t h e purchasers to
e x e c u t e t h e conveyance (strictly speaking only a signature is required at
present) is t h a t t h e r e i s a chance t h a t they will read it, and question t h e
n a t u r e of t h e interests being conveyed to them. If t h e r e is no such
requirement, they may never see t h e conveyance and be quite unaware of
its wording. Execution is desirable now, in order to extend t h e powers of
t h e purchasers, but this would no longer b e necessary if our proposal135 to

132 S e e para. 16.7.

133 Robinson v. Robinson (1976) 241 E.G. 153.

134 Pink v. Lawrence (1977) 36 P.& C.R.98.

135 Para. 7.5.

65
extend t h e powers of t r u s t e e s of land were adopted. The disadvantages
of requiring such execution a r e t h a t if, accidentally, i t fails to t a k e place,
one or other co-owner may be put at a disadvantage and i t may cause
delay to t h e transaction. Requiring formalities always puts a premium on
advice and leaves t h e c o u r t s with t h e o f t e n difficult task of deciding what
t h e e f f e c t of failing to observe t h e formalities should be. In general, i t
seems best to avoid t h e imposition of additional formalities unless they
a r e absolutely necessary, and we would therefore suggest t h a t no
execution should be required.136 I t should be noted t h a t purchasers a r e
I37
not, in any event, concerned with t r u s t s affecting t h e proceeds of sale.

16.6 Where t i t l e to t h e land is registered t h e purchasers may at

present b e required to e x e c u t e t h e transfer, not in order to declare t h e
n a t u r e and e x t e n t of t h e equitable interests, but in order to satisfy t h e
registrar t h a t t h e y a r e t h e beneficial owners. This is because s.58(3) of
t h e Land Registration A c t 1925 provides t h a t unless t h e registrar is so
satisfied, h e must register a restriction against t h e title. The standard
form of transfer to joint tenants13' provides for execution by t h e
purchasers. However, t h e authority given139 for this requirement is
Robinson v. Robinson,140 which, as has been said, is not t h e only
authority, and is, in any event, concerned with t h e rights of t h e co-owners
as between themselves, whereas t h e issue where registered t i t l e is
concerned is t h e e f f e c t on purchasers. W e would suggest that, as
between t h e parties, t h e arguments in t h e previous paragraph apply and

136 A useful comparison is s.65 of t h e Law of Property Act 1925 which

states t h a t a reservation of a legal estate o p e r a t e s without any
execution by t h e grantee.

137 Law of Property A c t 1925, s.27(1).

138 Form 19 (J.P.) c.p. Land Registration Rules 1925, Sched.

139 Ruoff and Roper, p. 321.

140 (1976) 241 E.G. 153.

66
execution should not be a requirement. W e would further suggest t h a t i t
is unnecessary as regards t h e registration of restrictions. A s t a t e m e n t in
t h e transfer t h a t i t is a transfer t o beneficial joint t e n a n t s should be
sufficient for t h e registrar not to have t o e n t e r a restriction, unless h e
has s o m e other evidence t h a t they a r e not t h e beneficial owners. Unless a
restriction is registered, a purchaser is entitled to assume t h a t t h e
141
registered proprietors have full powers of disposition.

16.7 The general view is t h a t , if t h e r e is a n express declaration,

then in t h e absence of fraud or mistake i t will p r e ~ a i 1 . l ~ ~However,
t h e r e have been suggestions t h a t t h e courts should consider t h e purpose of
t h e joint declaration, so t h a t if it was designed to protect t h e co-owners'
position on t h e death of o n e of them, i t should not necessarily involve
t h e m receiving equal shares of t h e proceeds if t h e property were sold
during their lifetime. This seems to introduce unnecessary
uncertainty. Where there is a n express declaration of trust, it should
always prevail unless t h e r e i s fraud o r mistake. An express declaration
t h a t t h e property is held with t h e co-owners as joint tenants in equity
should therefore c a r r y t h e s e implications: first, that either can sever at
any time, and secondly t h a t if severed, or if t h e property is sold and t h e
proceeds divided, they receive equal shares.

16.8 Despite repeated reminders by t h e courts144 many advisers

f a i l to ensure t h a t their clients make a declaration of trust.In such a
case, t h e position i s no more certain than i t would be had t h e property
been conveyed into o n e n a m e only. The fact of joint legal ownership will

141 Land Registration A c t 1925, s.74.

142 R e John's Assignment Trusts [I9701 1 W.L.R. 955, Leake v.

t19741 I W.L.R. 1528.

143 Burgess v. Rawnsle E19751 Ch. 429 per Lord Denning M.R. and see
- -
Wilson v. W d 6 6 3 1 1 W.L.R. 601.

144 -
Cowcher v. -
Cowcher [I9721 I W.L.R. 425, Bernard v.
Ch. 391, Walker v. Hall (1983) 14 Fam. Law 21.
Josephs [I9821

67
 not necessarily imply joint equitable ownership. 145 One is t h e r e f o r e
thrown back to t h e necessity of examining t h e parties' conduct at t h e
t i m e of t h e purchase, and their respective contributions. From their
conduct, one may be able to infer a n agreement or a "common intention"
as to how t h e property should be held. Their contributions may give rise
to a n equitable interest under a trust. I t is o f t e n extremely difficult to
decide what interests e a c h should receive. 146 As Griffiths L.J. put
it.147 "The contributions must b e viewed broadly by t h e judge t o guide
him to t h e parties' unexpressed and probably unconsidered intentions as
to t h e beneficial ownership of t h e house. There is of course a n a i r of
unreality about t h e whole exercise ...'I.

. 16.9 Where difficulties arise from a failure to make c l e a r provision

as to what is to happen, i t may b e helpful for s t a t u t e to fill t h e gap to
declare what t h e beneficial i n t e r e s t s a r e to b e if no express declaration
has been made. This c a n only be done if i t is possible to make a n
assumption about what most of those who f a i l to make a n express
declaration would have said if they had made such a declaration. We
would suggest t h a t t h e f a c t t h a t t h e house has been put i n t o joint names
should itself be indicative of an intention to c r e a t e some form of
beneficial co-ownership. Here, t h e r e is some evidence in respect of
married couples,148 none in respect of unmarried couples. Such evidence
as t h e r e is suggests t h a t a joint tenancy in equity is t h e wish of most
married couples where they buy a house for their occupation. T h e right
of survivorship whereby t h e surviving spouse automatically acquires t h e
deceased spouse's interest in t h e house is t h e most frequently mentioned

145 P e t t i t t v. P e t t i t t 119701 A.C. 777, 813.

146 S e e for example Young v. Young (1983) I 4 Fam. Law 271.

147 Bernard v. Josephs [I9821 Ch. 391, 404.

148 Todd and Jones, Matrimonial Property, 1972, Manners and R a u t a ,

Family Property in Scotland.

68
reason for choosing joint tenancy.149 W e would consider i t undesirable
as a m a t t e r of principle for property law t o differ for co-owners,
depending on whether they were married or not. W e therefore wish to
seek views as to t h e desirability of a provision which would apply
wherever a dwelling was conveyed into joint names at law without a n
express declaration as t o t h e beneficial interests. 15' W e assume this
should only apply to dwellings, as business premises a r e less likely t o
cause problems. The provision would state t h a t where t h e r e was no
express declaration, t h e property would be deemed t o be held for t h e co-
owners as beneficial joint tenants.

16.10 Various further questions arise. Should t h e provision only

apply where t h e dwelling is bought for t h e joint occupation of t h e co-
owners? A dwelling might be bought as a n investment. Should t h e
deemed joint tenancy give way only to:-

(i) a n express declaration, or

(ii) any agreement, or

(iii) a contrary intention of either party?

Of these (i) seems t o o absolute, while (iii) might allow t h e courts t o infer
a contrary intention from unequal contributions, which would reintroduce
all t h e existing difficulties. I t seems t h a t hi) may be t h e best way, again
trying not t o lay t r a p s for t h e unwary layman by demanding formalities
for such a n agreement. There would therefore be certainty with
flexibility for those who do not wish t o b e bound by t h e rule.

Severance

16.11 A t present, under s.36 of t h e Law of Property A c t 1925, a n

equitable joint tenancy c a n be severed either by notice in writing served
o n t h e other joint tenant, or by any method which would have severed a n

149 Although, for some couples, t h e t a x or intestacy consequences of

automatic survivorship may be undesirable.

150 Compare t h e provisions of t h e Partnership A c t 1890 concerning

ownership of partnership property.

69
equitable joint tenancy of personal property before 1926. This reference
t o pre-1926 law is now unnecessarily mystifying, and at t h e very l e a s t i t
would be desirable t o have a s t a t u t o r y provision setting o u t all t h e
methods which can b e used. The most frequently adopted s t a t e m e n t of
151
t h e pre-1926 law is t h a t of P a g e Wood V.-C. in Williams v. Hensman.
"A joint tenancy may be severed in three ways: in t h e f i r s t place, a n a c t
of any one of t h e persons interested operating upon his own share may
c r e a t e a severance as t o t h a t share ... Secondly, a joint tenancy may b e
severed by mutual agreement. And, in t h e third place, t h e r e may be a
severance by any course of mutual dealing sufficient to i n t i m a t e t h a t t h e
i n t e r e s t s of all were mutually t r e a t e d as constituting a tenancy in
common. When t h e severance depends on a n inference of this kind
without any express act of severance, i t will not suffice to rely on an
intention, with respect t o t h e particular share, declared only behind t h e
backs of t h e other persons interested." I t has been accepted t h a t t h e
second and third categories a r e s e p a r a t e so t h a t severance c a n b e
e f f e c t e d by a course of dealings which does not amount t o an agreement
t o sever.15* These t h r e e categories, together with t h e power to sever by
written notice, could be incorporated into a statute.

16.12 Another possible reform which has a c e r t a i n a t t r a c t i o n is t o

make a written notice t h e only possible method of severance. The other
methods do raise problems, for example, as to what is a sufficient act. I t
appears t h a t issuing a writ for t h e sale of land is a sufficient act, but
asking for a property s e t t l e m e n t in a divorce petition is not.153 Are the
other methods necessary? Severance has t o be looked at from t w o
points of view: i t s effect on t h e other joint t e n a n t and its effect on
potential purchasers of t h e property. So f a r as a potential purchaser i s
concerned, he is not a f f e c t e d so long as t h e r e a r e t w o t r u s t e e s holding t h e
legal estate for, by paying t h e price to them, t h e equitable interests a r e

151 (1861) 1 John & Hem. 546, 557.

152 Burgess v. Rawnsley [I9751 Ch. 429.

153 R e Draper's Conveyance [I9691 1 Ch. 486; Harris v. Goddard [I9831 1

W.L.R. 1203. Whether t h e l a t t e r case shows t h e present law in a
favourable light is questionable.
70
overreached. If t h e r e is only one legal joint tenant remaining and t h e
land was originally conveyed to joint tenants on trust for themselves as
joint tenants, t h e purchaser i s entitled t o assume t h a t t h e right of
survivorship has operated t o vest t h e e n t i r e legal and beneficial ownership
in t h e remaining legal owner, unless where t i t l e to land is unregistered a
memorandum of severance has been attached to t h e conveyance to t h e
joint tenants. 15' Where t i t l e to land i s registered, t h e purchaser c a n
assume t h e surviving proprietor can transfer a good t i t l e unless a
restriction has been entered. Where land is transferred to joint owners,
no restriction will be entered if t h e registrar is satisfied t h a t they a r e
jointly entitled in equity as well as at law. 155 If severance does t a k e
place, a purchaser will not be concerned with it unless a restriction is
entered. I t can be seen from this t h a t to a f f e c t a purchaser, severance
already requires some formality and t h a t i t would therefore cause l i t t l e
difficulty t o insist t h a t a l l severance b e done by written notice.

16.13 A s between t h e joint tenants, we would suggest t h a t such a

proposal could cause injustice. They may know nothing about t h e
technicalities of joint tenancy and the right of survivorship. Not knowing
i t exists, they will not know t h a t they can only end i t by written notice if
at all. If e i t h e r has behaved as though t h e joint tenancy does not exist
and t r e a t e d t h e property as his own, i t s e e m s right t h a t t h e law should
a c c e p t t h a t and permit severance through t h e acts or agreement of t h e
parties, e v e n though this may give rise t o problems where t h e other co-
owner does not realise t h a t severance has occurred.

154 Law of Property (Joint Tenants) A c t 1964.

155 Land Registration A c t 1925, s.58(3).

71
16.14 I t has been suggested156 t h a t i t should b e possible to sever by
will. In t h e situation of matrimonial breakdown, a spouse may b e anxious
to sever so t h a t , on his or her death, t h e property can be l e f t to t h e
children. Serving a notice may aggravate negotiations over, for example,
access to t h e children. Two of t h e methods of severance at present
allowed a r e unilateral, t h e a c t treating t h e interests as severed and t h e
giving of a notice. The other joint t e n a n t is given no choice. However,
h e will necessarily know t h a t i t has happened. Severance by will would
be similar. Severance would not, of course, t a k e place until t h e t e s t a t o r
died, and t h e other joint t e n a n t would then find out. There is t h e
possibility of a n unjust result where t h e t w o co-owners die at t h e s a m e
t i m e or within a short t i m e of e a c h other and one dies unaware of t h e
severance or unable to change his or her will. I t would b e necessary to
provide t h a t severance by will should be specified and explicit, so t h a t a
s t a t e m e n t of intention to sever should be a requirement. Severance
should not be implied by a gift, for example, of a l l t h e residue to a
charity, but a g i f t of "my halfshare of Blackacre" should be sufficiently
explicit to sever. There is a theoretical difficulty with severance by will.
A will is e f f e c t i v e from t h e moment a f t e r t h e death of t h e testator, and
t h e right of survivorship o p e r a t e s at t h e moment of death. There is
t h e r e f o r e a danger t h a t a notice of severance in a will comes too l a t e as
t h e right of survivorship divests t h e estate of t h e property i t is desired to
sever. I t would t h e r e f o r e be necessary t o make provision so t h a t any
notice of severance in a will severs t h e testator's interest before t h e right
of survivorship operates.

Bare trusts

16.15 W e suggested e a r l i e r t h a t bare t r u s t s of land a r e a potential

source of difficulty in t h a t they do not c o m e within either of t h e existing
s t a t u t o r y systems for t r u s t s of land. W e would n o t suggest a n y major
changes to t h e existing law. As t h e bare t r u s t e e acts at t h e direction of

156 Cretney, Principles of Family Law, 4th ed., 1984, p. 659.

72
t h e beneficiary, it would be wrong t o impose any additional duties on him.
However, where sale of t h e land is concerned difficulties may arise.
Generally t h e purchaser will obtain a good t i t l e f r e e from equitable
interest, because t h e t r u s t e e conveys in accordance with t h e wishes of t h e
beneficiary. However, if t h e t r u s t e e conveys without t h e knowledge of
t h e beneficary h e may appear t o be t h e sole beneficial owner. In such a
case t h e purchaser, where t i t l e i s unregistered, will only t a k e f r e e if h e
purchases f o r value in good f a i t h and has no notice of t h e equitable
interest. Where t i t l e is registered, t h e purchaser will t a k e f r e e unless
t h e beneficiary has protected his minor interest on t h e register, or is in
actual occupation.157 I t seems t o be a n underlying principle of t h e Law
of Property A c t 1925 t h a t land held on t r u s t should be capable of being
conveyed f r e e f r o m beneficial interests whether or not t h e purchaser has
notice of them. This is t h e reason for t h e overreaching machinery
provided in s.2. W e would suggest t h a t bare trusts should be brought
within s.2 so t h a t t h e interests of t h e beneficiary can be overreached,
provided t h a t a t least one additional t r u s t e e is appointed.

Inadvertent s e t t l e m e n t s
16.16 Inadvertent settlements f a l l into t w o categories. The first
a r e those where t h e intention is to c r e a t e s o m e s o r t of t r u s t or
settlement, and t h e settlor, by failing expressly to subject t h e land to a
t r u s t for sale, brings it within t h e Settled Land A c t 1925. If, as is likely,
this is a t r u s t in a will, t h e executors may not realise t h e t r u e e f f e c t of
t h e provisions and t h e wrong procedure may be followed, causing problems
for subsequent purchasers. This t y p e of inadvertent s e t t l e m e n t could b e
prevented by t h e adoption of any of t h e first t h r e e proposals, as it would
then, in every case, be clear what type of t r u s t had been created. The
second t y p e of inadvertent s e t t l e m e n t occurs when a person is given t h e
right to reside in a property during his lifetime, and subject to t h a t right
t h e property i s conveyed o r passes o n death to another. A t present t h e

~-

157 Hodgson v. Marks [I9711 Ch. 892.

73
result of such a n arrangement may be t h a t t h e land is s e t t l e d land under
t h e S e t t l e d Land A c t 1925, and t h e person with t h e right of residence is
158
t h e t e n a n t for life with full powers of disposition and management.
This result may b e thought to b e unsatisfactory, as t h e r e was no intention
to confer such a n extensive interest on t h e t e n a n t for life.159 However,
these cases should not necessarily be seen as wrongly decided. As
Megarry and Wade put it, “it has to be remembered t h a t t h e deliberate
policy of t h e A c t is t h a t t h e s t a t u t o r y powers must always b e available, so
t h a t t h e land is not sterilised, and t h a t these powers cannot b e restricted
or f e t t e r e d , whatever t h e settlor’s intentions. This policy may naturally
produce unintended results, but t h a t is not necessarily a good reason for
excluding a case from t h e purview of t h e Act.”16o

16.17 W e would suggest t h a t t h e r e is no simple answer to this

problem. However, a useful approach might be to say t h a t t h e effect of
a provision conferring rights of residence should depend on whether i t
appears, from t h e documents or from extrinsic evidence, t h a t t h e s e t t l o r
intended to give t h e person a n i n t e r e s t in t h e land. If i t does so appear
t h e n we would suggest that, r a t h e r than bring t h e land within t h e Settled
Land A c t 1925, t h e land should either b e held under t h e new t r u s t of land
outlined in Proposal I, or be held on t r u s t for sale, any sale to be subject
in either case to t h e consent of t h e person entitled to reside so long as h e
or she continues to b e in residence. By this means t h e r e would b e
someone, namely t h e trustees, who could deal with t h e land, t h e person
with a right of residence would have a considerable degree of protection,
and a result would b e achieved which would seem t o a c c o r d t o s o m e

158 R e Duce and Boots Cash Chemists (Southern) Ltd [19371 Ch. 642,
- -[I9481 2 All E.R.
Bannister v. Bannister
Ch. 359.
133, Binions v. Evans [I9721

159 Griffiths v. Williams 119781 E.G.D. 919.

160 Megarry and Wade, 5 t h ed., 1984, pp. 349-350, footnotes omitted.

74
e x t e n t with t h e intentions of t h e person who gave t h e right of residence
(although i t may be t h a t h e did not also intend to give any interest in t h e
proceeds of sale once t h e land is sold).

16.18 Where no interest in land was given, t h e courts could invoke

t h e developing a r e a of licences (a full discussion of which i s outside t h e
161
scope of this paper), in order to protect t h e occupier.

CONCLUSION

17.1 W e would emphasis t h a t any conclusions drawn in this paper

a r e provisional only. There is l i t t l e or no published information available
as to t h e e x t e n t t o which t h e Settled Land Act 1925 is still in use either
for existing s e t t l e m e n t s or for t h e creation of new ones, and i t may be
t h a t information we receive in response t o this paper will reveal a picture
different from t h a t which we envisage. However, our provisional view is
t h a t t h e form of s e t t l e m e n t provided by t h e Settled Land A c t 1925 is
excessively complex and no longer necessary. Whether i t should be
replaced entirely by a new t r u s t with power t o sell o r by t h e trust for sale
(i.e. Proposals I or 11) is a question on which our views a r e still more
tentative, although at present w e have some preference towards t h e
former solution. W e a r e not yet persuaded t h a t a new form of co-
ownership as set o u t in Proposal IV is necessary as w e consider it may
simply add more complication to a n already elaborate system. However,
w e a r e a w a r e t h a t t h e proposal does have attractions and we look forward
to receiving views on it. We hope t h a t discussions of t h e structural
reforms set o u t in t h e f i r s t four proposals will n o t prevent discussion of
Proposal V. Although not proposing one coherent reform, t h e m a t t e r s set
out there, such as severance, and declarations of t h e equitable interest,

161 S e e t h e judgment of Lord Denning in Binions v. Evans. For further

discussion of licences see Megarry and Wade, 5th-1984, pp. 798-
808, esp. 807-808, and Hanbury and Maudsley, 12th ed., 1985, pp.
833-868, esp. pp. 863-864.

75
are important and problems in those areas may have a practical e f f e c t on
significant numbers of people. Our suggested solutions may not be the
right ones, and again we look forward to receiving comments, criticisms
and alternative proposals.

76
 APPENDIX A

REFERENCES

-
Books

Cheshire and Burn's Modern Law of Real Property, 13th ed., 1982.
E m m e t on T i t l e 18th ed. 1983.

6. English and J. Saville, S t r i c t Settlement: a guide for historians, 1983.

R.E. Megarry and H.W.R. Wade. The Law of R e a l Property, 5th ed., 1984.
A.W.B. Simpson An Introduction to t h e History of t h e Land and Law,1961.

C o m m i t t e e Reports

Survey of Northern Ireland Land Law, 1971.

Law Reform Committee, 23rd Report, The powers and duties of trustees,
1982, Cmnd. 8733.

Articles

Benas, "The mending of t h e r e n t s in t h e settled land curtain", (1947) 11

Conv. (N.S.) 159.

Boyle, "Trusts for s a l e and t h e doctrine of conversion", [I9811 Conv. 108.

Cock, "Co-ownership - back to t h e Partition Acts?" [I9821 Conv. 415.

Cretney, "A technical and tricky matter", (1971) 34 M.L.R. 441.

Dockray, "Limited owners and inflation-proof rents"; [ 19791 Conv. 258.

Friend and Newton, "Undivided shares and t r u s t s for s a l e - a draftsman's

error?" [I9821 Conv. 213.

Garner, "Reforms of t h e land law - Northern Ireland style", (1971) 35

Conv. (N.S.) 92.
Grove, "Conveyancing and t h e Property A c t s of 1925, (1961) 24 M.L.R.
123.

Hornby, "Tenancy for life or licence", (1977) 9 3 L.Q.R. 561.

Lewis "Settlements of land", (1938) 54 L.Q.R. 576.

P o t t e r , "Strict s e t t l e m e n t and trust for sale", (1944) 8 Conv. (N.S.) 147.

P o t t e r , "Rents in t h e s e t t l e d land curtain", (1946) 10 Conv. (N.S.) 135.

P o t t e r , "Dispositions of s e t t l e d land by personal representatives", (1946)

11 Conv. (N.S.) 91.

Prichard, "Trusts for s a l e - t h e nature of t h e beneficiary's interest",

[I9711 C.L.J. 44.

Prichard, "Joint tenancy - t r u s t for sale - conversion", 119791 C.L.J. 251.

Ryder, "Settled land: mistakes and their consequences", (1962) 15 C.L.P.

194.

Scammell, "The Reform of t h e S e t t l e d Land Act 1925", (1957) 10 C.L.P.

152.

Stone, "A S e t t l e d Land Act problem revisted" [1984] Conv. 354.

Underhill, "Property", (1935) 51 L.Q.R. 221.

Withers, "Twenty years' experience of t h e property legislation of 1925",

(1946) 6 2 L.Q.R. 167.
 APPENDIX B

CONTENTS

S e t t l e d Land A c t 1925

s. 1
s. 18
SS. 26 - 27
s. 36
s. 106
S. 110

Trustee A c t 1925

s. 25

Law of Property A c t 1925

ss. 26 - 30
SS. 34 - 36

Administration of E s t a t e s A c t 1925

s. 33
s. 39
 SETTLED LAND ACT 1925

What constitutes 1.- (I). Any deed, will, agreement for a s e t t l e m e n t or

a settlement other agreement, Act of Parliament, or other instrument, or
any number of instruments, whether made or passed before or
a f t e r , or partly before and partly a f t e r t h e commencement of
this Act, under or by virtue of which instrument or
instruments and land, a f t e r t h e commencement of this Act,
stands for t h e t i m e being -

(i) limited in t r u s t for any persons by way of

succession; or

(ii) limited in t r u s t for any person in possession -

for a n entailed interest whether or not
capable of being barred or defeated;

for a n estate in fee simple or for a t e r m of

years absolute subject to a n executory
limitation, gift, or disposition over on failure
of his issue or in any other event;
for a base or determinable fee or any
corresponding interest in leasehold land;

being a n infant, for a n estate in fee simple or

for a t e r m of years absolute; or
(iii) limited in t r u s t f o r any person for a n estate in fee
simple or for a t e r m of years absolute contingently
on t h e happening of any event; or

(iv) ...
 (v) charged, whether voluntarily or in consideration of
marriage or by way of family arrangement, and
whether immediately o r a f t e r a n interval, with t h e
payment of any rentcharge for t h e l i f e of any
person, or any less period, or of any capital,
annual, or periodical sums for the portions,
advancement, maintenance, or otherwise for t h e
benefit of any persons, with or without any t e r m of
years for securing or raising t h e same;

c r e a t e s o r i s for t h e purposes of this A c t a settlement and is in

this A c t referred t o as a settlement, or as t h e settlement, as
t h e case requires:

Provided t h a t , where land is t h e subject of a compound

settlement, references in this A c t t o t h e s e t t l e m e n t shall be
construed as meaning such compound settlement, unless t h e
context otherwise requires.

(2) Where an infant is beneficially entitled t o land for

a n estate in f e e simple or for a t e r m of years absolute and by
reason of an intestacy or otherwise t h e r e is no i n s t r u m e n t
under which t h e interest of t h e infant arises or is acquired, a
s e t t l e m e n t shall be deemed t o have been made by t h e
intestate, or by t h e person whose interest t h e infant has
acquired.

(3) An infant shall be deemed to be entitled in

possession notwithstanding any subsisting right of dower (not
assigned by metes and bounds) a f f e c t i n g t h e land, and such a
right of dower shall be deemed t o be an interest comprised in
t h e subject of t h e s e t t l e m e n t and coming to t h e dowress under
o r by virtue of t h e settlement.
 Where dower has been assigned by metes and bounds, t h e
l e t t e r s of administration or probate granted in respect of t h e
estate of t h e husband of t h e dowress shall be deemed a
s e t t l e m e n t made by t h e husband.

(4) An estate or interest not disposed of by a

s e t t l e m e n t and remaining in or reverting to t h e settlor, or any
person deriving t i t l e under him, is for t h e purposes of this A c t
a n estate or interest comprised in t h e subject of the
s e t t l e m e n t and coming t o t h e settlor or such person under or
by virtue of t h e settlement.

(5) Where-

(a) a s e t t l e m e n t c r e a t e s a n entailed interest

which is incapable of being barred or
defeated, or a base or determinable fee,
whether or not t h e reversion or right of
reverter is in the Crown, or any
corresponding interest in leasehold land; or

(b) t h e subject of a s e t t l e m e n t is an entailed

interest, or a base or determinable f e e ,
whether or not t h e reversion or right of
reverter is in the Crown, or any
corresponding i n t e r e s t in leasehold land;

t h e reversion or right of r e v e r t e r upon t h e cesser of t h e

interest so c r e a t e d or s e t t l e d shall b e deemed to b e an interest
comprised in t h e subject of t h e s e t t l e m e n t , and limited by t h e
settlement.
 (61 Subsection ( 4 ) and ( 5 ) of this section bind t h e
Crown.

[(7) This section does not apply t o land held upon trust
for sale.]

NOTES
Words omitted repealed by t h e Married Women
(Restraint upon Anticipation) A c t 1949, s. 1(4), Sched. 2;
amendment in square brackets made by t h e Law of
Property (Amendment) A c t 1926, s 7, Sched.

Restrictions on 18.41 1 Where land i s t h e subject of vesting instrument and

dispositions of
t h e trustees of t h e settlement have not been discharged under
settled land
where trustees this Act, then-
h a v e not been
discharged.
(a) any disposition by t h e tenant for i f e or
statutory owner of t h e land, other than a
disposition authorised by this A c t or any
other statute, or made in pursuance to any
additional o r larger powers mentioned in t h e
vesting instrument, shall be void, except for
t h e purposes of conveying o r creating such
equitable interests as h e h a s power, in right
of his equitable interests and powers under
t h e trust instrument, to coveny o r create;
and

(b) if any capital money is payable in respect of

a transaction, a conveyance to a purchaser of
t h e land shall only t a k e e f f e c t under this A c t
if t h e capital money is paid to or by t h e
direction of t h e t r u s t e e s of t h e s e t t l e m e n t o r
into court; and
 (c) notwithstanding anything to t h e contrary in
the vesting instrument, or the trust
instrument, capital money shall not, except
where t h e t r u s t e e is a t r u s t corporation, be
paid t o or by t h e direction of fewer persons
than two as trustees a s of t h e settlement.

(2) The restrictions imposed by this section do not

affect-

(a) t h e right of a personal representative in

whom t h e settled land may be vested t o
convey or deal with t h e land for t h e purposes
of administration;

(b) t h e right of a person of full a g e who has

become absolutely entitled (whether
beneficially or as t r u s t e e f o r sale or personal
representative or otherwise) to t h e s e t t l e d
land, f r e e from all limitations, powers and
charges taking effect under the trust
instrument, to require the land to be
conveyed to him;

(c) t h e power of t h e t e n a n t for life, statutory

owner, or personal representative in whom
t h e s e t t l e d land is vested to transfer o r
c r e a t e such legal estates, to t a k e effect in
priority to the settlement, as may be
required for giving effect to any obligations
imposed on him by s t a t u t e , but where any
capital money is raised or received in respect
of t h e transaction t h e money shall b e paid to
or by t h e direction of t h e t r u s t e e s of t h e
s e t t l e m e n t or in accordance with a n order of
t h e court.
Infants, how to be 26.- (1) Where an infant is beneficially entitled in
affected possession t o land for a n estate in f e e simple o r for a t e r m of
years absolute o r would if of full age be a t e n a n t for life of o r
have t h e powers of a t e n a n t for life over settled land, then,
during t h e minority of t h e infant-

(a) if t h e settled land is vested in a personal

representative, t h e personal representative,
until a principal vesting instrument has been
executed pursuant to t h e provisions of this
Act; and

(b) in every other case, t h e trustees of t h e

settlernent;

shall have, in referene t o t h e settled land and capital money,

all t h e powers conferred by this A c t and t h e s e t t l e m e n t on a
t e n a n t f o r life, and on t h e trustees of t h e settlement.

(2) If t h e settled land is vested in a personal

representative, then, if and when during t h e minority t h e
infant, if of full age, would have been entitled t o h a v e t h e
legal estate in t h e settled land conveyed to o r otherwise
vested in him pursuant to t h e provisions of this Act, a
principal vesting instrument shall, if t h e trustees of t h e
s e t t l e m e n t so require, be executed, at t h e cost of t h e t r u s t
estate, for vesting t h e legal estate in themselves, and in t h e
meantime the personal representative shall, during t h e
minority, give e f f e c t to t h e directions of t h e t r u s t e e s of t h e
settlement, and shall not be concerned with t h e propriety of
any conveyance directed to be made by those trustees if t h e
conveyance appears t o be a proper conveyance under t h e
powers conferred by this A c t or by t h e settlement, and t h e
capital money, if any, arising under t h e conveyance is paid
to or by t h e direction of t h e t r u s t e e s of t h e s e t t l e m e n t or into
court, but a purchaser dealing with t h e personal representative
and paying t h e capital money, if any, t o him shall not be
concerned to see t h a t t h e money is paid to t r u s t e e s of t h e
s e t t l e m e n t o r i n t o court, or to inquire whether t h e personal
representative is liable to give e f f e c t to any such directions,
or whether any such directions have been given.

(3) Subsection (2) of this section applies whether t h e

infant becomes entitled before or a f t e r t h e commencement of
this Act, and has e f f e c t during successive minorities until a
person of full a g e becomes entitled to require t h e s e t t l e d land
to be vested in him.

(4) This section does not apply where an infant is

beneficially entitled in possession to land for an e s t a t e in fee
simple or for a t e r m of years absolute jointly with a person of
full a g e (for which case provision is made in t h e Law of
Property Act 1922, but i t applies to t w o or more infants
entitled as aforesaid jointly, until one of them a t t a i n s full age.

(5) This section does not apply where a n infant would,

if of full age, constitute t h e t e n a n t for life or have t h e powers
of a t e n a n t for life together with another person of full age,
but i t applies to t w o or more infants who would, if all of t h e m
were of full age, together constitute t h e t e n a n t for l i f e or
have t h e powers of a t e n a n t for life, until one of t h e m a t t a i n s
full age.

(6) Nothing. in this section a f f e c t s prejudicially any

beneficial interest of a n infant.
E f f e c t of 27.- ( I ) A conveyance of a legal estate in land t o an infant
conveying legal alone, or to t w o or more persons jointly, both or a l l of whom
estate t o
infant a r e infants, for his o r their own benefit shall o p e r a t e only as
a n agreement for valuable consideration to e x e c u t e a
s e t t l e m e n t by means of a principal vesting deed and a trust
instrument in favour of t h e infant o r infants, and in t h e
meantime t o hold t h e land in trust for t h e infant or infants.

(2) Nothing in this A c t prevents a n equitable interest

in settled land being vested in or transferred t o a n infant.

(3) ...
NOTE
Words omitted repealed, with saving, by t h e Family Law
Reform A c t 1969, s.ll(a).

Undivided shares 36.- (I) If and when, a f t e r t h e commencement of this Act,

~hin',a",etr~,:'~~: settled land is held in trust for persons entitled in possession
sale of t h e land under a t r u s t instrument in undivided shares, t h e trustees of
t h e s e t t l e m e n t (if t h e settled land is not already vested in
them) may require t h e estate owner in whom t h e settled land
is vested (but in t h e case of a personal representative subject
to his rights and powers for purposes of administration), at t h e
cost of t h e trust estate, t o convey t h e land to them, or assent
to t h e land vesting in them as joint tenants, and in t h e
meantime t h e land shall be held on t h e s a m e trusts as would
have been applicable t h e r e t o if i t had been so conveyed t o o r
vested in t h e trustees.

(2) If and when t h e settled land so held in t r u s t in

undivided shares i s or becomes vested in t h e trustees of t h e
settlement, t h e land shall be held by them (subject t o any
incumbrances affecting t h e settled land which a r e secured by
a legal mortgage, but freed from any incumbrances affecting
t h e undivided shares or not secured as aforesaid, and from any
interests, powers and charges subsisting under the t r u s t
instrument which have priority to t h e t r u s t for the persons
entitled t o the undivided shares) upon the statutory trusts.

(3) If t h e estate owner refuses or neglects for one

month a f t e r demand in writing to convey t h e s e t t l e d land so
held in t r u s t in undivided shares in manner aforesaid, or if by
reason of his being outside t h e United Kingdom or being unable
to be found, o r by reason, of t h e dissolution of a corporation,
o r for any other reason, t h e c o u r t is satisfied t h a t t h e
conveyance cannot otherwise b e made, or cannot be made
without undue delay or expense, the court may, on t h e
application of t h e t r u s t e e s of t h e settlement, make a n order
vesting t h e s e t t l e d land in t h e m on the s t a t u t o r y trusts.

(0) An undivided share in land shall not b e capable of

being c r e a t e d except under a t r u s t instrument or under t h e
Law of Property Act 1925, and shall then only t a k e effect
behind a t r u s t for sale.

(5) Nothing in this section affects t h e priority inter se

of any incumrbances whether a f f e c t i n g t h e e n t i r e t y of t h e
land or a n undivided share.

( 6 ) For t h e purposes of this section land held upon t h e

s t a t u t o r y t r u s t s shall be held upon t h e t r u s t s and subject t o t h e
provisions following, namely, upon t r u s t to sell t h e same, with
power to 'postpone t h e s a l e of t h e whole or any p a r t thereof,
and to stand possessed of t h e n e t proceeds of sale, a f t e r
payment of costs, and of t h e n e t r e n t s and profits until sale,
a f t e r payment of rates, taxes, costs of insurance, repairs, and
other outgoings, upon such t r u s t s and subject to such powers
and provisions as may b e requisite for giving effect to the
 rights of t h e persons interested in t h e settled land [and t h e
right of a person who, if t h e land had not been made subject to
a t r u s t for sale by virtue of this Act, would have been entitled
t o an entailed interest in a n undivided share in t h e land, shall
be deemed to be a right to a corresponding entailed interest in
t h e n e t proceeds of sale a t t r i b u t e to t h a t share].

(7) The provisions of this section bind the Crown.

NOTE
Addition in square brackets t o sub-s. (b) was made by t h e
Law of Property (Entailed Interests) Act 1932, s.l(lL

Prohibition or 106.- (1) If in a settlement, will, assurance, or other

limitation against
exercise of instrument executed or made before or a f t e r , or partly before
powers void, and and partly after, t h e commencement of this A c t a provision is
provision against
forfeiture inserted -

(a) purporting or attempting, by way of direction,

declaration, or otherwise, to forbid a t e n a n t for
l i f e or s t a t u t o r y owner to exercise any power under
this Act, or his right t o require t h e settled land t o
b e vested in him; or

(b) attempting, or tending, or intended, by a

limitation, gift, or disposition over of s e t t l e d land,
or by a limitation, gift, or disposition of other real
or any personal property, or by t h e imposition of
any condition, or by forfeiture, or in any other
manner whatever, to prohibit or prevent him from
exercising, or to induce him to abstain from
exercising, or to put him into a position
 inconsistent with his exercising, any power under
this Act, or his right t o require t h e s e t t l e d land t o
be vested in him;

t h a t provision, a s f a r a s i t purports, or a t t e m p t s , or tends, or

is intended to have, or would or might have, t h e operation
aforesaid, shall be deemed to b e void.

(2) For t h e purposes of this section an estate or

interest limited to continue so long only as a person abstains
from exercising any such power or right a s aforesaid shall be
and t a k e effect a s an estate or interest to continue for t h e
period for which i t would continue if t h a t person were to
abstain from exercising t h e power or right, discharged from
liability t o determination or cesser by or on his exercising t h e
same.

(3) Notwithstanding anything in a settlement, the

exercise by t h e t e n a n t for life or s t a t u t o r y owner of any power
under this A c t shall not occasion a forfeiture.

Protection of 110.- (1) On a sale, exchange, lease, mortgage, charge, o r

purchasers, etc.
other disposition, a purchaser dealing in good faith with a
t e n a n t for life or s t a t u t o r y owner shall, as against a l l parties
entitled under t h e settlement, be conclusively taken to have
given t h e best price, consideration, or rent, as t h e c a s e ’ m a y
require, t h a t could reasonably be obtained by t h e t e n a n t for
life or s t a t u t o r y owner, and to have complied with all t h e
requisitions of this Act.

(2) A purchaser of a legal estate in s e t t l e d land shall

not, except as hereby expressly provided, be bound or entitled
to call for t h e production of t h e t r u s t instrument or any
information concerning t h a t instrument or a n y a d valorem
s t a m p duty thereon, and whether or not he has notice of i t s
contents h e shall, save as hereinafter provided, be bound and
entitled if t h e last or only principal vesting instrument
contains t h e s t a t e m e n t s and particulars required by this A c t to
assume that-

the person in whom t h e land is by t h e said

instrument vested or declared to be vested is t h e
t e n a n t for life or statutory owner and has all t h e
powers of a t e n a n t for life under this Act,
including such additional or larger powers, if any,
as a r e therein mentioned;

t h e persons by t h e said instrument stated to be the

trustees of t h e settlement, or their successors
appearing to be duly appointed, a r e t h e properly
constituted trustees of t h e settlement;

t h e s t a t e m e n t s and particulars required by this A c t

and contaiend (expressly or by reference) in t h e
said instrument were c o r r e c t at t h e date thereof;

t h e s t a t e m e n t s contained in any deed executed in

accordance with this A c t declaring who a r e t h e
trustess of t h e s e t t l e m e n t for t h e purposes of this
A c t a r e correct;

t h e s t a t e m e n t s contained in any deed of discharge,

executed in accordance with this Act, a r e correct:

Provided that, as regards t h e first vesting instrument

executed for t h e purpose of giving e f f e c t to-

(a) a s e t t l e m e n t subsisting at t h e c o m m e n c e m e n t of
this Act; or
 a n instrument which by virtue of this Act is
deemed t o be a settlement; or

a s e t t l e m e n t which by virtue of this Act is deemed

to have been made by any person a f t e r t h e
commencement of this Act; or

an instrument inter vivos Intended t o create a

s e t t l e m e n t of a legal estate in land which is
executed a f t e r t h e commencement of this Act and
does not comply with t h e requirements of this A c t
with respect to t h e method of effecting such a
settlement;
a purchaser shall be concerned to see-

(i) t h a t t h e land disposed of to him is comprised

in such s e t t l e m e n t or instrument;

(ii) t h a t t h e person in whom t h e s e t t l e d land i s by

such vesting instrument vested, or declared
to be vested, is t h e person in whom i l ought
to be vested as t e n a n t for l i f e or s t a t u t o r y
owner;

(iii) t h a t t h e persons thereby s t a t e d to be t h e

t r u s t e e s of t h e s e t t l e m e n t a r e t h e properly
consituted trustees of t h e settlement.

(3) A purchaser of a legal estate in settled land from a

personal representative shall be entitled to act on t h e
following assumptions:-
 (i) If t h e capital money, if any, payable in
respect of t h e transaction i s paid t o t h e
personal representative, that such
representative is acting under his statutory
or other powers and requires t h e money for
purposes of administration;

(ii) If such capital money is, by t h e direction of

t h e personal representative, paid t o persons
who a r e stated to be t h e trustees of a
settlement, t h a t such persons a r e t h e duly
constituted trustees of t h e s e t t l e m e n t for t h e
purposes of this Act, and t h a t t h e personal
representative is acting under his statutory
powers during a minority;

(iii) In any other case, that the personal

representative is acting under his statutory
or other powers.

(4) Where no capital money arises under a transaction,

a disposition by a t e n a n t for l i f e or statutory owner shall, in
favour of a purchaser of a legal estate, have e f f e c t under this
A c t notwithstanding t h a t at t h e d a t e of t h e transaction t h e r e
a r e no trustees of t h e settlement.

( 5 ) If a conveyance of or a n assent relating to land

formerly subject to a vesting instrument does not state who
a r e t h e t r u s t e e s of t h e s e t t l e m e n t f o r t h e purposes of this Act,
a purchaser of a legal estate shall be bound and entitled to
act on t h e assumption t h a t t h e person in whom t h e land was
thereby vested was entitled to t h e land f r e e from all
limitations, powers, and charges taking e f f e c t under that
settlement, absolutely and beneficially, or, if so expressed in
the conveyance or assent, a s personal representative, or
trustee for sale or otherwise, and that every statement of fact
in such conveyance or assent is correct.
 TRUSTEE ACT 1925

Power to delegate 25.- [(I) Notwithstanding any rule of law or equity to t h e

trusts during
contrary, a t r u s t e e may, by power of attorney, delegate for a
absence abroad
period not exceeding twelve months t h e execution or exercise
of all or any of t h e trusts, powers and discretions vested in
him as t r u s t e e e i t h e r alone or jointly with any other person or
persons.

(2) The persons who may be donees of a power of

a t t o r n e y under this section include a t r u s t corporation but not
(unless a t r u s t corporation) t h e only other co-trustee of t h e
donor of t h e power.

(3) An instrument c r e a t i n g a power of a t t o r n e y under

this section shall b e a t t e s t e d by at least o n e witness.

(4) Before or within seven days a f t e r giving a power of

a t t o r n e y under this section t h e donor shall give written notice
thereof (specifying t h e d a t e on which t h e power comes into
operation and i t s duration, t h e donee of t h e power, t h e reason
why t h e power is given and, where s o m e only a r e delegated,
t h e trusts, powers and discretions delegated) to-

(a) e a c h person (other than himself), if any, who

under any instrument creating t h e t r u s t has
power (whether alone o r jointly) to appoint a
new trustee; and

(b) e a c h of t h e o t h e r trustees, if any;

but failure to comply with this subsection shall not, in favour
of a person dealing with t h e donee of t h e power, invalidate any
a c t done or instrument executed by t h e donee.

(5) The donor of a power of a t t o r n e y given under this

section shall be liable for t h e acts or defaults of t h e donee in
t h e s a m e manner as if t h e y were t h e acts o r defaults of the
donor].

[(6)1 For t h e purpose of executing or exercising t h e

t r u s t s or powers delegated to him, t h e donee may ewercise any
of t h e powers conferred on t h e donor as t r u s t e e by s t a t u t e o r
by t h e instrument creating t h e trust, including power, for t h e
purpose of t h e transfer of any inscribed stock, himself to
delegate to a n a t t o r n e y power to transfer but not including t h e
power of delegation conferred by t h i s section.

[(7)] The fact t h a t i t appears from any power of

a t t o r n e y given under this section, or from any evidence
required for t h e purposes of any such power of a t t o r n e y or
otherwise, that in dealing with any stock t h e donee of t h e
power is acting in t h e execution of a t r u s t shall not b e deemed
for a n y purpose to a f f e c t any person in whose books t h e stock
is inscribed o r registered with any notice of t h e trust.

[@U This section applies to a personal representative,

t e n a n t for l i f e and s t a t u t o r y owner as i t applies to a t r u s t e e
e x c e p t t h a t subsection (4) shall apply as if i t required t h e
notice t h e r e mentioned to be given-

(a) in t h e case of a personal representatives, to

each of t h e o t h e r personal representatives, if
any, except any executor who has renounced
probate;
 in t h e case of a tenant for life, to t h e
trustees of t h e settlement and t o e a c h
person, if any, who together with t h e person
giving t h e notice constitutes t h e tenant f o r
life;

in t h e case of a statutory owner, to e a c h of

t h e persons, if any, who together with t h e
person giving t h e notice constitute t h e
statutory owner and, in t h e case of a
statutory owner by virtue of section 23(l)(a)
of t h e Settled Land A c t 1925, to t h e trustees
of t h e settlement.

NOTE
Amended by t h e Powers of Attorney A c t 1971, s.9.
 LAW OF PROPERTY ACT 1925
Consents to t h e 26.- (I) If t h e consent of more than t w o persons is by t h e
execution Of a disposition made requisite t o t h e execution of a t r u s t for sale
t r u s t for s a l e
of land, then, in favour of a purchaser, t h e consent of any two
of such persons t o t h e execution of t h e t r u s t or to t h e exercise
of any s t a t u t o r y or other powers vested in t h e t r u s t e e s for sale
shall be deemed sufficient.

(2) Where t h e person whose consent t o t h e execution

of any such t r u s t or power is expressed to be required in a
disposition is not sui juris or becomes subject t o disability, his
consent shall not, in favour of a purchaser, b e deemd to b e
requisite to t h e execution of t h e t r u s t or t h e exercise of t h e
power; but t h e t r u s t e e s shall, in any such case, obtain t h e
s e p a r a t e consent of t h e parent or testamentary or o t h e r
guardian of an infant or of t h e ... receiver (if any) of a [person
suffering from mental disorder].

[(31 Trustees for sale shall so f a r as practicable consult

t h e persons of full a g e for t h e t i m e being beneficially
interested in possession in t h e rents and profits of t h e land
until sale, and shall, so f a r as consistent with t h e general
interest of t h e trust, give effect to t h e wishes of such persons,
or, in t h e case of a dispute, of t h e majority.(according to t h e
value of their combined interests) of such persons, but a
purchaser shall not be concerned to see t h a t t h e provisions of
this subsection have been complied with.

In t h e case of a t r u s t for sale, not being a t r u s t for s a l e

c r e a t e d by o r in pursuance of t h e powers conferred by this or
any other Act, this subsection shall not aply unless t h e
contrary intention appears in t h e disposition creating t h e
trust.]
 (4) This section applies whether t h e t r u s t for sale is
c r e a t e d before or a f t e r t h e commencement or by virtue of this
Act.

NOTES
Sub-s.(2): amended by t h e Mental Health A c t 1959,
s.149(1), Sched. 7, P a r t I.

Sub-~43): substituted by t h e Law of Property

(Amendment) A c t 1926, s.7, Sched.

Purchaser not to 27.- (1) A purchaser of a legal estate from trustees for sale
be concerned with
shall not be concerned with t h e trusts affecting t h e proceeds
t h e trusts of t h e
proceeds of sale of sale of land subject t o a trust for sale (whether made t o
which a r e to be
attach t o such proceeds by virtue of this A c t or otherwise), or
paid t o t w o or
m o r e trustees or affecting t h e rents and profits of t h e land until sale, whether
t o a trust
or not those trusts a r e declared by t h e s a m e instrument by
corporation
which t h e trust for sale i s created.

[(2)1 Notwithstanding anything t o t h e contrary in t h e

instrument (if any) creating a trust for sale of land or in t h e
s e t t l e m e n t of t h e n e t proceeds, t h e proceeds of sale or other
capital money shall not be paid t o or applied by t h e direction
of fewer than t w o persons as trustees for sale, except where
t h e t r u s t e e i s a t r u s t corporation, but this subsection does not
a f f e c t t h e right of a sole personal representative as such to
give valid receipts for, or direct t h e application of, proceeds
of sale or other capital money, nor, except where capital
money arises on t h e transaction, render i t necessary to have
more t h a n o n e trustee.]

NOTE
Sub-s.(2): substituted by t h e Law of Property
(Amendment) A c t 1926, s.7, Sched.
Powers of 28.- (1) Trustees for s a l e shall, in relation t o land o r to
management, manorial incidents and to t h e proceeds of sale, have all t h e
etc.,
conferred on powers of a t e n a n t for life and t h e trustees of a s e t t l e m e n t
t r u s t e e s for sale under t h e S e t t l e d Land A c t 1925, including in relation to t h e
land t h e powers of management conferred by t h a t Act during a
minority land where by s t a t u t u t e s e t t l e d land is or becomes
vested in t h e t r u s t e e s of t h e s e t t l e m e n t upon t h e s t a t u t o r y
trusts, such t r u s t e e s and their successors in o f f i c e shall also
have all t h e additional or larger powers (if any) conferred by
t h e s e t t l e m e n t on t h e t e n a n t for life, s t a t u t o r y owner, or
t r u s t e e s of t h e settlement) and (subject to any express t r u s t
to t h e contrary) all capital money arising under t h e said
powers shall, unless paid or applied for any purpose authorised
by t h e S e t t l e d Land A c t 1925, be applicable in t h e s a m e
manner as if t h e money represented proceeds of s a l e arising
under t h e t r u s t for sale.

All land acquiried under this subsection shall be

conveyed to t h e t r u s t e e s on t r u s t for sale.

The powers conferred by this subsection shall be

exercised with such consents (if any) as would have been
required on a sale under t h e t r u s t for sale, and when exercised
shall o p e r a t e to overreach any equitable i n t e r e s t s or powers
which a r e by virtue of this A c t or otherwise made to a t t a c h to
t h e n e t proceeds of s a l e as if c r e a t e d by a t r u s t affecting
those proceeds.

(2) Subject to any direction to t h e contrary in t h e

disposition on t r u s t f o r s a l e or in t h e s e t t l e m e n t of t h e
proceeds of sale, t h e n e t r e n t s and profits of t h e land until
sale, a f t e r keeping down costs of repairs and insurance and
o t h e r outgoings shall be paid or applied, e x c e p t so f a r as any
p a r t thereof may b e liable t o be set aside as capital money
under t h e Settled Land A c t 1925 in like manner as t h e income
of investments representing t h e purchase money would b e
payable or applicable if a sale had been made and t h e proceeds
had been duly invested.

(3) Where t h e n e t proceeds of sale have under t h e

trusts affecting t h e s a m e become absolutely vested in persons
of full a g e in undivided shares (whether or not such shares may
b e subject to a derivative trust) t h e trustees for sale may,
with t h e consent of t h e persons, if any, of full age, not being
annuitants, interested in possession in the net rents and profits
of t h e land until sale:-

(a) partition t h e land remaining unsold or any

part thereof; and

(b) provide (by way of mortgage or otherwise)

for t h e payment of any equality money;

and, upon such partition being arranged, t h e trustees for sale

shall give e f f e c t t h e r e t o by conveying t h e land so partitioned
in severalty (subject o r not to any legal mortgage c r e a t e d f o r
raising equality money) t o persons of full age and either
absolutely o r on t r u s t for sale or, where any p a r t of t h e land
becomes s e t t l e d land, by a vesting deed, or partly in one way
and partly in another in accordance with t h e rights of t h e
persons interested under t h e partition, but a purchaser shall
not be concerned to see o r inquire whether any such consent as
aforesaid has been given:

Provided that-
(i) If a s h a r e in t h e n e t proceeds belongs to a
[person suffering from mental disorder], t h e
consent of his ... receiver shall b e sufficient
t o protect t h e trustees for sale:
 (ii) If a share in t h e n e t proceeds is a f f e c s t e d by
a n incumbrance t h e t r u s t e e s f o r sale may
either give effect t h e r e t o or provide for t h e
discharge thereof by means of t h e property
allotted in respect of such share, as they may
consider expedient.

(4) If a share in t h e net proceeds is absolutely vested

in a n infant, t h e t r u s t e e s for sale may act on his behalf and
retain land (to be held on t r u s t for sale) o r o t h e r property to
represent his share, but in other respects t h e foregoing power
shall apply as if t h e infant had been of full age.

(5) This section applies to dispositions on t r u s t for sale

coming into operation either before or after the
commencement or by virtue of this Act.

NOTES
Sub-s (1): amended by t h e Law of Property (Amendment)
A c t 1926, s.7, Sched.

Sub-s (3): amended by t h e Mental Health Act 1959, s.

149(1), Sched. 7, P a r t I.

Delegation of 29.- (1) The powers of and incidental to leasing, accepting

powers of
mnagement by surrenders of leases and management, conferred on t r u s t e e s
t r u s t e e s for sale for sale whether by this Act or otherwise, may, until sale of
t h e land, be revocably delegated from t i m e t o time, by
writing, signed by them, to any person of full a g e (not being
merely an annuitant) for t h e t i m e being beneficially entitled in
possession to t h e n e t rents and profits of t h e land during his
life or for any less period: and in favour of a lessee such
writing shall, unless t h e contrary appears, be sufficient
evidence t h a t t h e person named therein is a person to whom
t h e powers may b e delegated, and t h e production of such
writing shall, unless t h e contrary appears, be sufficient
evidence t h a t t h e delegation has not been revoked.
 (2) Any power so delegated shall be exercised only in
t h e names and on behalf of t h e trustees delegating t h e power.

(3) The persons delegating any power under this

section shall not, in relation to t h e exercise or purported
exercise of t h e power, be liable for t h e acts or defaults of t h e
person to whom t h e power is delegated, but t h a t person shall,
in relation-to t h e exercise of t h e power by him, be deemed to
be in t h e position and to have t h e duties and liabilities of a
trustee.

(4) Where, at t h e commencement of this Act, a n order

m a d e under section seven of t h e Settled Land A c t 1884 is in
force, t h e person on whom any power is thereby conferred
shall, while t h e order remains in force, exercise such powers in
t h e names and o n behalf of t h e trustees for sale in like manner
as if t h e power had been delegated to him under this section.

Powers of court 30. If t h e trustees for sale refuse to sell or t o exercise anv
where of t h e powers conferred by either of t h e last t w o sections, or
for sale refuse to
exercise powers any requisite consent cannot b e obtained, any person
interested may apply t o t h e court for a vesting or other order
for giving e f f e c t to t h e proposed transaction o r f o r a n order
directing t h e trustees for sale to give e f f e c t thereto, and t h e
c o u r t may make such order as i t thinks fit.

E f f e c t of future 34.- (I) An undivided share in land shall not be capable of

dispositions to
tenants in being c r e a t e d except as provided by t h e Settled Land A c t 1925
common or as hereinafter mentioned.

(2) Where, a f t e r t h e commencement of this Act, land

is expressed to be conveyed to any persons in undivided shares
and those persons a r e of full age, t h e conveyance shall
[notwithstanding anything to t h e contrary in this A c t ) o p e r a t e
as if t h e land had been expressed t o be conveyed to t h e
grantees, or, if t h e r e a r e more t h a n four grantees, to t h e four
 f i r s t named in t h e conveyance, as joint t e n a n t s upon t h e
s t a t u t o r y trusts hereinafter mentioned and so as t o give effect
t o t h e rights of t h e persons who would have been entitled to
t h e shares had t h e conveyance operated to c r e a t e those
shares:

Provided t h a t , where t h e conveyance is made by way of

mortgage t h e land shall vest in t h e grantees or such four of
them a s aforesaid for a t e r m of years absolute (as provided by
this A c t ) as joint tenants subject t o cesser on redemption in
like manner as if t h e mortgage money had belonged to t h e m on
a joint account, but without prejudice to t h e beneficial
interests in t h e mortgage money and interest.

(3) A devise bequest or t e s t a m e n t a r y appointment,

coming i n t o operation a f t e r t h e commencement of this Act, of
land to two o r more persons in undivided shares shall o p e r a t e
as a devise bequest or appointment of t h e land to t h e t r u s t e e s
(if any) of t h e will for t h e purposes of t h e Settled Land Act
1925 or, if t h e r e a r e no such trustees, then to t h e personal
representatives of t h e testator, and in e a c h case (but without
prejudice to t h e rights and powers of t h e personal
representatives for purposes of administration) upon t h e
s t a t u t o r y t r u s t s hereinafter mentioned.

(4) Any disposition purporting to make a s e t t l e m e n t of

a n undivided share in land shall only o p e r a t e as a s e t t l e m e n t of
a corresponding s h a r e of t h e n e t proceeds of sale and of t h e
r e n t s and profits until s a l e of t h e e n t i r e t y of t h e land.

Meaning of t h e 35. For t h e purposes of this A c t land held upon t h e

statutory trusts
"statutory trusts" shall be held upon t h e t r u s t s and subject to
t h e provisions following, namely, upon t r u s t s to sell t h e s a m e
and to s t a n d possessed of t h e net proceeds of sale, a f t e r
payment of costs, and of t h e n e t r e n t s and profits until sale
a f t e r payment of rates, taxes, costs of insurance, repairs, and
 other outgoings, upon such trusts, and subject t o such powers
and provisions, as may be requisite for giving e f f e c t to t h e
rights of t h e persons (including a n incumbrancer of a former
undivided share or whose incumbrance is not secured by a legal
mortgage) interested in t h e land [and t h e right of a person
who, if t h e land had not been made subject t o a trust for s a l e
by virtue of this Act, would have been entitled to a n entailed
interest in a n undivided share in t h e land, shall be deemed t o
be a right to a corresponding entailed interest in t h e n e t
proceeds of sale attributable to t h a t share].

[Where-
(a) an undivided share was subject to a
settlement, and

(b) t h e settlement remains subsisting in respect

of other property, and

(c) t h e trustees thereof a r e not t h e s a m e persons

as t h e trustees for sale,
then t h e statutory trusts include a trust for t h e trustees for
sale to pay t h e proper proportion of t h e n e t proceeds of sale or
other capital money attributable t o t h e share to t h e trustees
of t h e s e t t l e m e n t to be held by t h e m as capital money arising
under t h e Setled Land A c t 19251.

NOTES
First amendment made by t h e Law of Property (Entailed
Interests) A c t 1932, s.1; second amendment made by t h e
Law of Property (Amendment) A c t 1926, s.7, Sched.

Joint 36.- (I) Where a legal estate (not being settled land) is
tenancies
beneficially limited to or held in trust for any persons as joint
tenants, t h e s a m e shall b e held on trust f o r sale, in like
manner as if t h e persons beneficially entitled were t e n a n t s in
common, but not so as t o sever their joint tenancy in equity.
 (2) No severance of a joint tenancy of a legal estate,
so as to c r e a t e a tenancy in common in land, shall b e
permissible, whether by operation of law or otherwise, but this
subsection does not a f f e c t t h e right of a joint t e n a n t to
release his i n t e r e s t to t h e other joint tenants, or t h e right to
sever a joint tenancy in an equitable interest whether or not
t h e legal estate is vested in t h e joint tenants:

Provided that, where a legal estate (not being s e t t l e d

land) is vested in joint tenants beneficially, and any t e n a n t
desires t o sever t h e joint tenancy in equity, h e shall give t o
t h e other joint t e n a n t s a notice in writing of such desire or d o
such o t h e r a c t s or things as would, in t h e case of personal
estate, have been e f f e c t u a l to sever t h e tenancy in equity, and
thereupon under t h e t r u s t for s a l e affecting t h e land t h e net
proceeds of sale, and t h e n e t r e n t s and profits until sale, shall
be held upon t h e t r u s t s which would have been requisite for
giving effect t o t h e beneficial i n t e r e s t s if t h e r e had been a n
a c t u a l severance.

[Nothing in this A c t affects t h e right of a survivor of

joint tenants, who is solely and benefically interested, to deal
with his legal estate a s if i t were not held on t r u s t for sale.]

(3) Without prejudice to t h e right of a joint t e n a n t to

release his interest to t h e other joint t e n a n t s no severance of
a mortgage t e r m or t r u s t estate, so as to c r e a t e a tenancy in
common, shall be permissible.

NOTE
Sub-s (2): amended by t h e Law of Property (Amendment)
A c t 1926, s.7, Sched.
 ADMINISTRATION OF ESTATES ACT 1925

Trust for sale 33.- (1) On t h e death of a person i n t e s t a t e a s to any real or

personal s t a t e , such e s t a t e shall be held by his personal
representatives-

(a) a s t o t h e real e s t a t e upon t r u s t t o sell t h e

same; and

(b) as to t h e personal e s t a t e upon t r u s t t o call in

sell and convert into money such part thereof
a s may not consist of money,

with power t o postpone such sale and coversion for such a

period a s t h e personal representatives, without being liable t o
account, may think proper, and so t h a t any reversionary
interest be not sold until it falls into possession, unless t h e
personal representatives s e e special reason for sale, and so
also t h a t , unless required for purposes of administration owing
to want of other assets, personal c h a t t e l s be not sold except
for special reason.

(2) Out of t h e n e t money t o arise from t h e sale and

conversion of such real and personal estate (after payment of
costs), and out of t h e ready money of t h e deceased (so f a r as
not disposed of by his will, if any), t h e personal representative
shall pay a l l such funeral, testamentary and administration
expenses, debts and other liabilities as a r e properly payable
thereout having regard to t h e rules of administration
contained in this P a r t of this Act, and o u t of t h e residue of t h e
said money t h e personal representative shall s e t aside a fund
sufficient to provide for any pecuniary legacies bequeathed by
t h e will (if any) of t h e deceased.
 (3) During t h e minority of any beneficiary or t h e
subsistence of any l i f e interest and pending t h e distribution of
t h e whole or any p a r t of t h e estate of t h e deceased, t h e
personal representatives may invest t h e residue of t h e said
money, or so much thereof as may not have been distributed,
in any investments for the t i m e being authorised by s t a t u t u t e
for t h e investment of t r u s t money, with power, at t h e
discretion of t h e personal representatives, to change such
investments for others of a like nature.

(4) The residue of t h e said money and any investments

for the t i m e being representing t h e same, including (but
without prejudice to t h e t r u s t for sale) any p a r t of t h e estate
of t h e deceased which may be retained unsold and is not
required for t h e administration purposes aforesaid, is in this
A c t referred to as " t h e residuary estate of t h e intestate."

(5) The income (including n e t r e n t s and profits of real

estate and c h a t t e l s real a f t e r payment of rates, taxes, rent,
costs of insurance, repairs and o t h e r outgoings properly
a t t r i b u t a b l e to income) of so much of t h e real and personal
estate of t h e deceased as may not b e disposed of by his will, if
any, or may not be required for t h e administration purposes
aforesaid, may, however such estate is invested, as from t h e
death of t h e deceased, be t r e a t e d and applied as income, and
for t h a t purpose any necessary apportionment may be made
between t e n a n t for life and remainderman.

( 6 ) Nothing in this section a f f e c t s t h e rights of a n y

creditor of t h e deceased or t h e rights of t h e Crown in respect
of death duties.

(7) Where t h e deceased leaves a will, t h i s section has

e f f e c t subject to t h e provisions contained in t h e will.
Powers of 39.- (1) In dealing with t h e real and personal estate of t h e
management
deceased his personal representatives shall, for purposes of
administration, or during a minority of any beneficiary or t h e
subsistence of any life interest, or until t h e period of
distribution arrives, have-

(i) t h e s a m e powers and discretions, including

power t o raise money by mortgage or charge
(whether or not by deposit of documents), a s
a personal representative had before t h e
commencement of this Act, with respect to
personal estate vested in him, and such power
of raising money by mortgage may in t h e
c a s e of land be exercised by way of legal
mortgage; and

(ii) all the powers, discretions and duties

conferred or imposed by law on trustees
holding land upon an e f f e c t u a l t r u s t for sale
(including power to overreach equitable
interests and powers a s if t h e s a m e a f f e c t e d
t h e proceeds of sale); and

(iii) all t h e powers conferred by s t a t u t e on

t r u s t e e s for sale, and so t h a t every c o n t r a c t
e n t e r e d into by a personal representative
shall b e binding on and be enforceable against
and by t h e personal representative for t h e
t i m e being of t h e deceased, and may be
carried into e f f e c t , or b e varied or rescinded
by him, and, in t h e c a s e of a c o n t r a c t entered
into by a predecessor, as if i t had been
entered into by himself.
 (2) Nothing in this section shall a f f e c t the right of any
person to require an assent or conveyance to be made.

(3) This section applies whether the testator or

intestate died before or after the commencement of this Act.
 APPENDIX C

LAW REFORM COMMITTEE, Z3RD REPORT

THE POWERS AND DUTIES OF TRUSTEES

PART I X

SUMMARY OF RECOMMENDATIONS

9.1 Only those conclusions which Will require some change in t h e

law a r e s e t out in this summary.

III Trustees' Duties

Powers and Duties of Investment (paragraphs 3.1-3.25)

(a) Investment in Land (paragraphs 3.1-3.14)

...
6. (iv) t h e decision in r e Power should be reversed and a new
statutory power introduced enabling trustees to
purchase a residence for occupation by t h e person
entitled to t h e income on t h e moneys laid out in t h e
purchase or eligible t o have i t applied for his benefit;
(paragraph 3.5)

7. Trustees should be empowered t o make purchases under

recommendation 6(ivl above on mortgage. (paragraph 3.1 1)

...
Duty to Act Unanimously (paragraphs 3.60-3.66)

24. Section 30 of t h e Law of Property Act 1925 should b e

extended to allow an application to t h e court for an order for sale
by t h e t r u s t e e s even where they a r e not themselves beneficiaries
under t h e trust. (paragraph 3.64)
...
V M i l l a n e w s Points (paragraphs 5.1-5.8)
...
37. Legislation should b e introduced corresponding to section 36(7)
of t h e Administration of E s t a t e s Act 1925 to apply where t h e r e has
been a conveyance of a legal estate not expressly made subject to
t h e t r u s t for sale. (paragraph 5.6)
...
VI Powers and Duties to Charity Trustees (paragraph 6.1-6.6)
...
41. Land held by charitable trustees on a fixed d a t e , which has not
already vested in t h e Official Custodian for Charities or any other
c o r p o r a t e body, should vest in t h e Official Custodian for Charities.
T h e t r u s t e e s should then be empowered to convey t h e legal estate
on his behalf under t h e provisions of section 17(2) of t h e Charities
A c t 1960. (paragraph 6.3).
...
VIII Settled Land (paragraphs 8.1-8.11)

52. A t e n a n t for life of s e t t l e d land should be empowered to grant

a lease of t h a t land or any p a r t of i t at a r e n t initially ascertained
by arbitration or valuation, or any other generally recognised
method of arriving at t h e best rent. (paragraph 8.4)

53. A t e n a n t for l i f e should b e given s t a t u t o r y authority to g r a n t

concurrent leases. (paragraph 8.5).

54. Section 41 of t h e S e t t l e d Land Act 1925 should be amended to

give t h e t e n a n t for life t h e power to grant ordinary leases of 99
years. (paragraph 8.6).
 55. Trustees of a settlement should be empowered t o require a
fenant for life to obtain valuations i n respect of transactions under
section 101 of the Settled Land Act 1925 so enabling them to
control transactions with the settled land more effectively.
(paragraph 8.9).

56. Section 51 of the Settled Land Act 1925 should be amended so

as to enable the tenant for life of a settlement to grant options at a
price to be fixed by valuation, arbitration or any other generally
recognised method. (paragraph 8.1 01.

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