Interests of Third Parties in Properties
The main issue arising from this problem is the question of establishing
various interests of third parties in the two properties, and the differing
procedures for doing so, given that Rust Plot is a registered fee simple
title, while Umber Plot is an unregistered fee simple title. This brief will
attempt to answer the questions regarding the proposed ‘agricultural use
only’ deed, whether Steve has any legal interests in the properties as he
claims to have, and also whether Traci has an equitable interest in both
properties arising from the common law and the doctrine of constructive
notice.
The first issue to be addressed is whether or not the deed produced by
Quentin, which outlines Vernon’s promise to use the land for agricultural
purposes only, still has a binding effect upon Peter after his purchase of
the land. There is, therefore, a claim made by Quentin that there is an
existing covenant on the properties which should bind successive owners
of the property. There is no evidence in the facts to suggest that the deed
is procedurally invalid (i.e. that it does not comply with the formality
requirements of section 52(1) of Law of Property Act 1925, and section 1
of the Law of Property (Miscellaneous Provisions) Act 1989), so it will be
assumed that the deed is valid in nature. This brief will, therefore,
consider whether this deed is binding upon Peter, given that it was
created between Quentin and Vernon (the previous owner of the
property). Under statutory law, the promises made in leases made by
deed will normally become covenants. The courts would normally construe
the terms of the lease as covenants unless the language used in the lease
clearly makes that term a condition (i.e. the landlord would have a right to
automatically bring the term of the lease to an end for breach of a
condition, but not for a covenant). So, there is no disputing that the deed
was binding upon Vernon, the previous owner, and Quentin at some point,
so it is therefore incumbent upon me to advise as to whether the deed is
now binding on Peter. Section 3 of the Landlord and Tenant (Covenants)
Act 1995 provides that the “benefit and burden” of all landlord and tenant
covenants in the tenancy shall form part of the premises and shall pass
upon transfer of ownership. This transfer of covenants is pursuant to other
provisions, which specifies that if the covenant is personal to another
person then it cannot be transferred. Therefore, under the ‘new law’
(provided that the tenancy was granted after the introduction of this Act
(1 January 1996)), the covenant will be enforceable against Peter, and
thus he will have to use the grounds for agricultural purposes only. If the
lease was created before this time, it would fall under the jurisdiction of
the old (common) law. The main source of authority for this issue
is Spencer’s Case (1583) 5 Co Rep 16a, which states that a third party
(i.e., the new owner) can only be bound by previous covenants if:
There is privity of estate between the new owner and the tenant;
and
The covenant “touches and concerns” the premises in question.
The main issue arising from this problem is the question of establishing
various interests of third parties in the two properties, and the differing
procedures for doing so, given that Rust Plot is a registered fee simple
title, while Umber Plot is an unregistered fee simple title. This brief will
attempt to answer the questions regarding the proposed ‘agricultural use
only’ deed, whether Steve has any legal interests in the properties as he
claims to have, and also whether Traci has an equitable interest in both
properties arising from the common law and the doctrine of constructive
notice.
The first issue to be addressed is whether or not the deed produced by
Quentin, which outlines Vernon’s promise to use the land for agricultural
purposes only, still has a binding effect upon Peter after his purchase of
the land. There is, therefore, a claim made by Quentin that there is an
existing covenant on the properties which should bind successive owners
of the property. There is no evidence in the facts to suggest that the deed
is procedurally invalid (i.e. that it does not comply with the formality
requirements of section 52(1) of Law of Property Act 1925, and section 1
of the Law of Property (Miscellaneous Provisions) Act 1989), so it will be
assumed that the deed is valid in nature. This brief will, therefore,
consider whether this deed is binding upon Peter, given that it was
created between Quentin and Vernon (the previous owner of the
property). Under statutory law, the promises made in leases made by
deed will normally become covenants. The courts would normally construe
the terms of the lease as covenants unless the language used in the lease
clearly makes that term a condition (i.e. the landlord would have a right to
automatically bring the term of the lease to an end for breach of a
condition, but not for a covenant). So, there is no disputing that the deed
was binding upon Vernon, the previous owner, and Quentin at some point,
so it is therefore incumbent upon me to advise as to whether the deed is
now binding on Peter. Section 3 of the Landlord and Tenant (Covenants)
Act 1995 provides that the “benefit and burden” of all landlord and tenant
covenants in the tenancy shall form part of the premises and shall pass
upon transfer of ownership. This transfer of covenants is pursuant to other
provisions, which specifies that if the covenant is personal to another
person then it cannot be transferred. Therefore, under the ‘new law’
(provided that the tenancy was granted after the introduction of this Act
(1 January 1996)), the covenant will be enforceable against Peter, and
thus he will have to use the grounds for agricultural purposes only. If the
lease was created before this time, it would fall under the jurisdiction of
the old (common) law. The main source of authority for this issue
is Spencer’s Case (1583) 5 Co Rep 16a, which states that a third party
(i.e., the new owner) can only be bound by previous covenants if:
There is privity of estate between the new owner and the tenant;
and
The covenant “touches and concerns” the premises in question.
