Professional Documents
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Real Property: Understanding The Law
Real Property: Understanding The Law
Property
Understanding the Law
Table of
Contents
• Introduction
• Land Ownership
• Easements
• Mortgages
Introduction
Real Property is concerned with the rights and liabilities which arise in
respect of immovable property. In its legal sense, ‘land’ includes not just
the soil and things growing naturally on it, but any buildings and fixtures
erected thereon.
Owned Real Property=
Right in Rem
‘Ownership’ of real property gives a right against the
world, that is, a right in rem. A right in rem suggests that
the “owner” has a right to take action against anyone who
violates his interest.
Fixtures and Chattles
FIXTURES CHATTLES
Any structure or material thing attached to the land Any structure which does not form part of the land
(realty and property of land owner) (removable)
Grounded in the maxim "quicquid plantatur solo solo When removed, it should not transform, alter or
cedit" ie. what is affixed to the land forms part of it disrupt the character of the land
and belongs to the soil
Examples: water heater, air conditioning, light fixtures, Examples: machines unattached to floor, zinc shed or
dishwashers store room
There are exceptions to the general rules concerning fixtures and chattels
• Whether the chattel has become attached to the land that it is deemed a fixture
• Whether or not the law would grant the chattel owner chattel the right to remove what
may be considered a fixture but this is entirely discretionary.
Fixtures and Chattles Cont'd
Determining whether an object is a fixture or chattle Lord Blackburn in
Holland v Hodgson (1872) LR 7 CP 328 says that "This is a question of fact
depending on the circumstances of each case, and principally on two
considerations; first, the mode of annexation to the soil or fabric of the house,
and the extent to which it is united to them, whether it can easily be removed ...;
secondly, on the object and purpose of the annexation, whether it was for the
permanent and substantial improvement of the dwelling, ... or merely for a
temporary purpose and the more complete enjoyment and use of it as a
chattel."
Mitchell v Cowie [1964] Test
According to Wooding CJ
“. . . It is essential not to confuse what are really two separate and wholly independent issues: the
first, whether the thing in question is a chattel or a fixture: if it is a chattel . . . its owner may dispose
of it without let or hindrance whenever he pleases: but if it is a fixture, then and only then, the
second issue may be raised—whether it is subject to any right of removal.”
Mitchell v Cowie [1964] Test
Additionally, Wooding CJ coined 6 criteria to determine whether a chattel has or has not become a
fixture.
• whether it was intended to form part of the land on which it stands (objective; ie dependent on the
circumstances)
• whether the house is affixed to the land
• generally, a house resting its weight on land (not affixed) will be a chattel unless, based on the
relevant facts and circumstances, there was an intention for it to form part of the land. If you allege it
is not part, you must prove
• generally, a house affixed, whether slight or not, it will be part of the land unless, based on the
relevant facts and circumstances, there was an intention for it to form part of the land. If you allege it
is part, you must prove
Mitchell v Cowie [1964] Test
5. Specifically as regards a house affixed to land by a tenant thereof, a circumstance of primary
importance is the object or purpose of the annexation.
6. To ascertain the object or purpose of the annexation, regard must be had to whether the affixation of
the house to the land is temporary and for use a chattel, or is permanent and intended to be for the better
enjoyment of the land. But for this purpose it must at all times be bone in mind that the intention or right
of the tenant to remove the house from the land on the cesser of his interest as tenant with the result that
no improvements will accrue to the landlord’s reversionary interest
If the article is not attached to the land by it's own weight then it is not part of the land unless it is
proven based on the circumstances and the intentions that it should have form part of the land
(Blackburn J in Holland v Hodgson). For a visual, think about houses that rests on stilts
How to Determine If a Chattel Or Fixture Exists
• Degree and mode of annexation; See Burke v Bernard; Eva Fields v Rosie Modeste
• custom and usage ie is the type of activity common in that particular area; See
Baptiste v. Supersad
Land Ownership
Tenure: Concerned with the interest in land. Remember the Crown owns all land and we all
have 'tenure'.
leasehold estate: A leasehold estate exists where ‘exclusive possession’ is granted for a term at a rent. Leaseholds will be
explored in much greater detail next semester. Suffice to say for now that the primary distinction between a leasehold estate
and a freehold estate is that the time for the determination of a freehold as at an unknown point in the future, whereas it is a
characteristic of a leasehold that there is certainty of duration.
life estate: A life estates is not a ‘fee’, and as such it cannot be inherited by an heir on intestacy. These however still fall within
the category of ‘freehold’ as the time at which the estate will come to an end cannot be stated with certainty. There are 2 types
at common law; estate for the life of the guarantee and estate pur autre vie (during the life of another person).
Legal and Equitable Interests
According to Kodilinye,
"A legal right, estate or interest is one that historically was recognised and enforced by the
common law courts, such as the old King’s Bench or Common Pleas Courts. These courts tended
to adopt a very inflexible approach and would deny a remedy to a deserving plaintiff merely
because he had not observed the proper formalities. The Court of Chancery, on the other hand,
where rules of equity were applied, habitually mitigated the harshness of the common law by
recognising new rights, such as the beneficiary’s interest under a trust, and by granting new
remedies to deserving plaintiffs, such as injunctions and specifi c performance, despite the
absence of the proper formalities".
emphasis added
Legal and Equitable Interests
in simple terms
A legal Interest is that which is derived from a title or some other legally recognizable document
that guarantees a right in rem.
An Equitable interest on the other hand is that which arises where there is an interest in the land
but no title exists. The major difference however is that the rights under this form of interest are
not binding upon a bona fide purchaser of a legal estate who has no notice of the existence of the
equitable interest.
Waste
The holder of a fee simple estate (ie. a tenant for life or lease holder) has the right to use and abuse the land as he sees fit,
subject to the rights of his neighbours, public policy considerations, injury to others (think of the rule in Rylands v
Fletcher) and statute.
The holder of a life estate is on the other hand is limited in the activities in which he can partake in the land, in that he
ought not to despoil it in such a manner as to prejudice those in reversion or remainder. A life tenant therefore should not
commit waste, else he may incur tortious liability (the doctrine is also applicable in landlord and tenant contexts).
Waste consists of some act which changes the nature of the land, for better or for worse. There are four categories of
waste:
(a) Ameliorating waste – this paradoxical term involves alterations which improve the land, such as improving
dilapidated buildings. Ameliorating waste is not capable of attracting an award in damages (as no damage has been
suffered), but equity may grant an injunction.
(b) Permissive waste – this occurs where the tenant fails to do what ought to be done, such as through the non-repair
of buildings or the non-clearance of a ditch. It however appears that an action for permissive waste cannot be
maintained in the absence of some covenant or agreement.
(c) Voluntary waste – this occurs where the life tenant does what ought not to be done, such as spoiling or
destroying houses, cutting down timber or the removal of fixtures (which are not tenant’s fixtures). In the absence of
some express stipulation, a life tenant is liable for voluntary waste.
A life tenant may be granted the estate exempting him from liability for voluntary waste, for e.g. a grant
“without impeachment of waste”. If no such exemption is given, the life tenant is said to be “impeachable of
waste”.
(d) Equitable waste – this only arises where the life tenant is granted his estate without impeachment of
waste. Equitable waste essentially leaves the door open for the life tenant to be liable for wonton acts of
destruction, such as stripping a house of fixtures and substantially reducing its value, pulling down houses or
removing timber placed for ornament or shelter. An injunction may be obtained to restrain equitable waste.
Co-ownership
Co-ownership arises where two or more people hold the same estate or interest in land at the same
time, the focus being mutual ownership. The focus here is therefore on simultaneous enjoyment of
property as distinct from successive interests.
• Joint Tenancy
• Tenancy-in-Common
Joint Tenancy
This is distinguished by the four unities which give right of survivorship where joint tenants concur
in granting a lease, the interest of the lessee continues notwithstanding the decease of either of the
lessors, and the survivor is entitled to the whole rent
Unity of possession is common to a joint tenancy and a tenancy in common. This exists
where each co-tenant is entitled to physical possession of the whole land. Therefore there
can be no division of the land and no restriction on any co-tenant’s use to any part of it. A
co-tenant cannot claim any part of the land as belonging to him/her.
Unity of interest
Unity of interest means that each joint tenant’s interest in the property must be identical in
nature, extent and duration. Thus each joint tenant must have the same type of freehold,
leasehold, reversion etc. Similarly the interests of each joint tenant must be identical in
quantity; therefore if one co-owner is given a one-third share and the other a two-thirds
share, a joint tenancy cannot be created.
Unity of title
All of the co-owners must receive their interest in land under the same document or
instrument. All interest must have been given under the same will for example.
Unity of time
Each joint tenant’s title must vest at the same time. A life tenant and a remainderman could
not therefore be a joint tenant in respect of the same property because the remainderman
would get possession later in time.
Tenancy in Common
Tenants in common only has the unity of possession; they might have unequal
shares, and there is no right of survivorship. Each tenant in common could at
common law make a lease in respect of his own share alone, the interest of each
being separate and distinct, and if tenants in common all joined in one lease it
operated as a lease by each of his respective share, and a confirmation by each as
to the shares of the others.
Features of Joint Tenancy
A joint-tenancy may be severed in three ways: in the first place, an act of any one of the persons
interested operating upon his own share may create a severance as to that share. … Secondly, a joint-
tenancy may be severed by mutual agreement. And, in the third place, there may be a severance by any
course of dealing sufficient to intimate that the interests of all were mutually treated as constituting a
tenancy in common.
A joint tenancy may therefore be severed in the following ways (the first three
evident from Page Wood V-C’s statement):
• A joint tenant acting upon his own share;
• Mutual agreement;
• A course of dealing which intimates the shares are to be held as tenants in
common;
• Homicide;
• Written notice (in some jurisdictions);
What is a Lease?
"Where the only circumstances are that residential accommodation is
offered and accepted with exclusive possession for a term at a rent, the
result is a tenancy [Lease]"
An interest in land; provides rights in rem or No rights in or to the land or to occupy it e.g. Bare
proprietary rights; licence
1.Right to exclude (including landlord) Contractual licence- if any right granted then merely
Enforce rights by ejectment or action for trespass personal not proprietary; limited to terms of contract
Passes to the successor in title to the tenant including No right to assign, sublet to 3rd parties and license
by way of will or intestacy in cases of natural persons does NOT pass to successors of either party (unless
the parties expressly agree and then only to the extent
of the agreement)
Lease Licence
If 1 or more of the above is not made out on the facts or it is disclosed that the existence of any 1
or more of the legally recognized reasons why the occupation is not a lease then there is no lease
Exclusive Possession- Determination and Issues
According to Garner in A Practical Approach to Landlord and Tenant, 7th ed @ p. 26, in determining
if exclusive possession is granted close attention must be paid to the degree of control over the
premises and their use which is retained by their owner.
Things that have been brought up to defeat or support a claim of exclusive possession;
• Provision of services attendant to the grant of occupation
• Grantor’s retention of keys to the premises occupied
• Grantors provision of right to permit other occupiers to share the premises from time to time=
multiple occupation
Landlord and Tenant
The relationship of a landlord and tenant if created by agreement is created at law ie, grant
of lease and in equity ie by specifically enforceable agreement for a lease. The subject of
the LL and T relationship is “leasehold estate” or “lease” or “tenancy”. Lease is used to
refer to the document that creates the estate or the estate itself.
If the courts have concluded on there being exclusive possession for a certain term at a rent then they
will consider whether;
• The parties lacked an intention to create legal relations between themselves = question of fact
• Some other legal relationship between them which is why exclusive possession was granted
• The grantor of the accommodation doesn’t have the power to grant the tenancy
Lord Templeman in Street said that an occupier who enjoys exclusive possession is not necessarily a
tenant. It would be a freeholder, trespasser or mortgagee in possession.
Types of Tenancies
Fixed Term Lease: A lease may be granted for any fixed period, however short or long,
provided there is a certain beginning and a certain ending within the principles
previously described. Leases for one year, two years or five years on the one hand,
and leases for 21, 99 or 999 years on the other, are common. A lease for a fixed
period terminates automatically when the period expires; there is no need for any
notice to quit by the landlord or the tenant.
Another basic characteristic of a fixed term lease is that the landlord cannot
terminate the lease before the end of the period unless the tenant has been in
breach of a condition in the lease, or the lease contains a forfeiture clause and the
tenant has committed a breach of covenant which entitled the landlord to forfeit the
lease. Nor can the tenant terminate the lease before it has run its course; he may
only ask the landlord to accept a surrender of the lease, which offer the landlord may
accept or reject as he pleases.
Types of Tenancies
Periodic Tenancy: Weekly, monthly, quarterly and yearly tenancies are the commonest
examples of periodic tenancies. Such tenancies continue indefinitely until terminated
by proper notice to quit by the landlord or the tenant.
Tenancy at Sufferance: Where T remains in possession of the land after the expiry of his
lease without L’s assent or dissent, a tenancy at sufferance arises. A tenant at
sufferance differs from a trespasser in that his original entry was lawful, and from a
tenant at will in that his tenancy exists without L’s consent. L may claim possession at
any time, and he is entitled to claim compensation for T’s ‘use and occupation’. The
relationship may be converted into a periodic tenancy by the payment of rent
Types of Tenancies
Tenancy by Estoppel: If L purports to grant a lease of land to T but L has no title to the
land, L is estopped from repudiating the tenancy and T is also estopped from denying
L’s title and the tenancy’s existence. In such a case, there arises a ‘tenancy by
estoppel’ which, although invalid vis à vis third parties, is binding on L and T and, as
between them, has the attributes of a true tenancy. As Farwell LJ described it:60 It is
true that a title by estoppel is only good against the person estopped and imports
from its very existence the idea of no real title at all, yet as against the person
estopped it has all the elements of a real title. Thus, covenants contained in the lease
are enforceable by and against L and T and their successors
Landlord's Implied
Covenants
T
Consequences
Summarised
LIABILITY OF THE LANDLORD FOR BREACH OF
COVENANT
Where the tenant has a personal agreement with the sub lessee which
does not touch and concern the land, this arrangement is not
enforceable against the tenant’s successor. This is illustrated in Hand
v Blow [1901], where a tenant covenanted with his landlord to
replace chattels and machinery which were not fixtures, it was held
that the covenant could not be enforced against the tenant’s assignee
as it did not run with the land. The landlord may seek to terminate a
lease or enforce its covenant where the tenant is in breach of the
covenant.
EASEME
NTS
Unique circumstance where My Land can be controlled by
another
What is an Easement?
The easement must The dominant and The right claimed must
There must be a dominant accommodate the dominant servient owners must be capable of forming
and a servient tenement tenement, that is, it must be be different persons the subject matter of a
connected with its grant
enjoyment and be for its
benefit
Presence of a Dominant and
Servient Tenement
There must be a servient tenement over which the right is
exercised. Where one has to use the property belonging to
another (servient tenement) to access his land (dominant
tenement) this is an easement. So that, if there is no
dominant tenement, there is only the servient tenement. If
one is using the servient tenement then that is a licence
and not an easement. There cannot be an easement in
gross, that is, an easement cannot exist where the
claimant has no interest in a dominant tenement, the
enjoyment of which is dependent on an easement over a
servient tenement
Accommodation of Dominant
Tenement
This rule requires that the right must confer an advantage
on the dominant land. It is not sufficient that only a mere
personal advantage is being enjoyed but must be a right
for the better enjoyment of the dominant tenement. The
dominant and servient tenements need not be adjacent to
each other, though this is usually the case. An example of
this is where a utility company is granted an easement to
place its pole and wires over X’s land, even though the
utility company’s land, the dominant tenement, may be
far away from X’s land, the servient tenement.
Need for Difference Between Dominant
and Servient Owners
The basic principle is that all easements ‘lie in grant’; that is, in
theory, every easement is created by grant, whether express,
implied or presumed. Thus, no right can be an easement unless it The right must not substantially deprive the servient
is capable of being granted. This proposition is somewhat owner of possession of the servient tenement
unhelpful, since it does not define what characteristics a right
must possess in order that it may be granted. However, it appears
from the case law that there are at least four requirements.
There must be a capable grantor and grantee
(i) statute
Necessity
(ii) a grant
(iii) reservation
Intended Easement
A conveyance of land shall be deemed to include and shall by virtue of this Act operate
to convey with the land, all buildings, erections, fixtures, commons, hedges, ditches,
fences, ways, waters, watercourses, liberties, privileges, easements, rights and
advantages whatsoever, appertaining or reputed to appertain to the land, or any part
thereof, or at the time of conveyance demised, occupied or enjoyed therewith, or reputed
or known as part or parcel of or appurtenant to the land, or any part thereof. Quasi-Easement
(a) For the express reservation to apply it must be specifically stated in the instrument of transfer or
deed of conveyance
(b) In Wheeldon v Burrowes the claim was for an implied reservation of the right of access to light.
Such right was claimed as being impliedly reserved in the conveyance. The Court of Appeal held that
a reservation can only arise where it is expressly stated in the conveyance.
EXTINGUISHING EASEMENTS
BY UNITY OF
OWNERSHIP BY EXPRESS BY IMPLIED
AND RELEASE BY DEED RELEASE
POSSESSION
(‘ABANDONMEN
OF THE
DOMINANT T’)
AND
S E RV I E N T 01 02 03
TENEMENTS
Mortgages
Mortgage???
A mortgage has been defined as ‘a conveyance or other disposition of an interest in property
designed to secure the payment of money or the discharge of some other obligation’. A mortgage
of land may be legal or equitable, and it may relate to freehold or leasehold land.
Lindley MR in Santley v Wilde [1899] 2 Ch 474, defined a mortgage as a disposition of an
interest in land or other property as a security for the payment of a debt or the discharge of some
other obligation for which it is given
Basically...
Mortgage = real security for the payment of money lent.
Mortgagor is a creditor who has rights over property of the debtor who is a mortgagee.
Legal mortgage of unregistered land may be created by a conveyance of the mortgagor’s
fee simple estate to the mortgagee subject to a proviso that, upon redemption (that is,
repayment of the debt), the property should be reconveyed to the mortgagor
A legal mortgage arises where all legal formalities in terms of registering a mortgage has
been observed. The title will also reflect the fact of registration
An equitable mortgage is one in which the lender is secured by taking the deposit of title-
deeds given by the owner of an estate, for money borrowed with an accompanying
agreement to execute a regular mortgage, or by the mere deposit of the title without any
further arrangements.
An equitable mortgage may arise where
• the owner of an equitable interest in land assigning his interest to a mortgagee
• The owner of a legal interest effecting an informal mortgage
• The deposition of title deeds by owner with the intention that the mortgagee should hold
them as security for the loan
Rights of a Mortgagor
The mortgagor has a legal right to redeem...
A mortgage deed refers to the loan and conveys the mortgaged property to the mortgagee subject
to the right of the mortgagor to redeem (that is, to repay the loan plus interest and recover his
property) on a fixed date, which is, by tradition, normally six months from the date of execution
of the mortgage. There is, therefore, a contractual right to redeem on the stipulated date. At
common law, if the mortgagor failed to redeem his property on the exact day fi xed by the
agreement, then the estate of the mortgagee became absolute and the mortgagor’s interest in the
land was extinguished. In modern mortgages, on the other hand, principal and interest are
normally repayable by monthly instalments over a long period: for example, 25 years.
Rights of a Mortgagor
The mortgagor has a...
4. Restraint of trade- Under this doctrine, any stipulation in a contract that imposes an unreasonable
restriction on the freedom of a person to engage in trade or to pursue a profession will be prima
facie void.
Rights of Mortgagor in
Possession
The mortgagor, though obligated to pay the monthly installments to the mortgagee,
retains rights over the property without having to account to the mortgagee. Some of
these retained rights are:
These remedies are both concurrent and cumulative: the mortgagee can pursue all or any
simultaneously as soon as the mortgagor is in default, and, if one remedy proves insuffi
cient to