Fundamentals of Land Ownership, Slides of Law

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FUNDAMENTALS OF LAND OWNERSHIP Doctrine of Tenure and Doctrine of Estates Doctrine of Tenure • Doctrine which emanated through the feudal system in England (a hierarchical pyramid in which all power emanated from the Crown) • People given the right to hold land – given tenure by the Crown in relation to land • Land held directly or indirectly as tenant of the Crown (cf. native title) o No concept of absolute ownership of land o Therefore, in order to describe the level/kind ownership, three estates development (see below) – possible to own the estate as a thing, separate from the land itself • Limited practical significance Doctrine of Estates • Because you can’t own the land, all you can own in land is the estate • Estate in fee simple: Most extensive, absolute right in relation to land that you can have in our system o Upon the death of the holder, the tenant in fee simple would descend to lineal and collateral heirs o Disposal: by inter vivos disposition (transfer or conveyance to another person), or by way of will o Conveyancing in medieval times – livery of season – handing over a small portion of dirt as symbolic of transferring the land • Life estate: interest in land ends on the holder’s death o Ordinary life estate – gives the holder a right to reside in the property and receive in the income from the property. No power to grant any interest that lasts beyond their lifetime o Estate dependent on the life of another – “to A during the life of B” – A holds the rights associated with an ordinary life estate, for as long as B lives o Section 4 of the Succession Act – worded broadly to enable the testator to dispose of property to which he or she is entitled ▪ Section 3 – property – includes any ‘valuable benefit’ – view is taken that valuable benefit would include life estates and estates dependent on the life of another • Estate in fee tail: someone with the fee simple would grant A a fee tail, allowing A to do with the land what they want during their lifetime. Upon A’s death, the land would transfer to a designated heir o Extinct in NSW: Conveyancing Act sections 19 & 19A o Still exists in SA The Creation of Legal & Equitable Interests in Land Requirements for Creation of a Particular Proprietary Right • Essential/substantive requirements: what package of rights has the grantor intended to create? o Fee simple – exclusive possession forever o Life estate – exclusive possession for duration of measuring life o Lease – exclusive possession for a certain term o Easement – right, accommodating dominant land to use, or restrain use of, servient land in a manner not inconsistent with servient owner’s continuing ownership o Profit a prendre – right to enter servient land and remove the soil or its natural produce • Formal requirements: how much that intention be manifested? o E.g. must a document be used; if so, what type; is a particular form of words required? Words of Purchase and Words of Limitation • Words of purchase; words of limitation o To A and his heirs o To B and the heirs of her body o To C for life o To D for the life of X Conveyancing Act 1919 (NSW) – section 47 (1) In a deed it shall be sufficient in the limitation of an estate in fee simple to use the words in fee or fee simple without the word heirs, or in the case of a corporation sole without the word successors, or to use the words in tail or in tail male or in tail female, without the words heirs of the body, or heirs male of the body, or heirs female of the body (2) Where land is conveyed to or to the use of any person without words of limitation, such conveyancing shall be construed to pass the fee simple or other the whole estate or interest the person conveying had power to dispose by deed in such land unless a contrary intention appears by such conveyance (3) This section only applies to deeds executed after the commencement of this Act Succession Act 2006 (NSW) – section 38 (1) A disposition of real property to a person without words of limitation is to be construed as passing the whole estate or interests of the testator in that property to that person (2) This section does not apply if a contrary intention appears in the will Legal and Equitable Interests Legal Interests • Interests that were recognised by a court exercising legal jurisdiction prior to the passing of the Judicature Acts (i.e. when equity and law were separate courts) • Deed: Conveyancing Act – section 23B(1) • Certain short-term leases: Conveyancing Act– section 23D(2) • Implied leases and easements • Statutory tenancy at will Equitable Interests • Interests that would have been recognized by the court exercising equitable jurisdiction (Court of Chancery) • NB: Fiona Burns’ list of equitable interests on p 5&6 of class notes – focus on: o Right of purchaser under a valid agreement for sale of land o Right of mortgage… • Written and signed instrument: section 23C(1)(a) o Section 41 – Real Property Act • Contracts for the sale of land or go grant an interest in land o Which are enforceable: s 54A(1), (2); and o In respect of which equity would decree specific performance: Lysaght v Edwards, Walsh v Lonsdale • Declaration of trust: section 23C(1)(b) • Resulting or constructive trust: section 23C(2) o E.g. purchase price resulting trust – presumed where legal title taken in a manner that does not reflect respective contributions to purchase price and no operable presumption of advancement • Vendor’s or purchaser’s lien • Equity of redemption on grant of a general law mortgage General Law Priority Rules • The general law priority rules apply to land in the absence of statutory intervention • Subject to registration schemes: o Section 184G Conveyancing Act [Old System land] o Sections 41-43A; 45; 118 Real Property Act [Torrens title land] • The Torrens indefeasibility provisions alter the operation of competing legal interests, or competing legal and equitable interests • Some of these principles, outlined below, will remain: o Section 43A attempts to protect the bona fide purchaser for value without notice o The equitable vs. equitable principle of first in time, but for postponing conduct, remains relevant when examining competing equitable unregistered interests. However, what amounts to postponing conduct (e.g. failure to a caveat) will be slightly new Prior legal v later legal • Where two or more legal interests in one parcel of land are inconsistent with each other, priority depends on the date of the creation of the interests • This is an application of the ‘nemo dat quod non habet’ rule (a person cannot convey an interest that he or she does not have) • Since most legal interests are created by deeds, for practical purposes priority depends on the date on which the deeds creating the interests came into operation