#1933 - Creation, Assignment And Registration Of Leases - Land Law

Creation, assignment and registration of leases

Creation

• This is regulated by our old friend the LPA 1925

  • Number of things required:

    • S.53(1)(a): All interests must be created by writing signed by the person creating the interest

    • S.52(1): Must be created by deed

    • S.54(1): All other interests created by parol but not writing have the effect as interests at will only, notwithstanding any consideration given.

  • Two principal exceptions:

    • Assent by personal representative only requires writing

    • Short leases need not be entered into with great formality

      • Indeed. s.54(2): If lease of period not exceeding three years

        • Then oral lease is acceptable

          • So long as stipulates

            • best rent which could be reasonably obtained without taking a fine

            • And possession is taken immediately (so lease can’t be postponed)

      • LRA 2002 Sch 1 para 1: Legal leases of less than seven years are overriding interests so long as not discontinuous nor future leases

        • Equally s.33(2)(b): three year leases can’t be registered.

        • Smith: However, leads to fine distinctions re: “immediate possession”= agreement for lease for a year granted in six months will be fine

          • As it is an agreement for immediate possession after grant

          • Whereas agreement for immediate lease to take effect in a few days will fall out of the statute.

Registration

• Legal lease exceeding seven years may be registered in same way as fee simple

  • Means could be number of legal titles on same plot of land

  • Smith: point of doing this is protect long leases where freehold land is not actually registered.

    • And also to prevent the register of interests on a freehold covenant becoming unduly cumbersome.

  • Compulsory Registration

    • LRA 2002 S.4(2) Whether Landlord title registered or not, every grant of lease for more than seven years must be registered

      • Otherwise you get no legal estate.

  • Exceptions to 7 year rule

    • Future lease under which possession will be taken in the future must be registered

      • Because they represent a trap to purchasers.

        • Therefore not an overriding interest (no occupation) and must be registered to have effect. Under LRA 2002

    • LRA 2002 s.3(4) For similar reasons discontinuous leases must be registered.

The impact of Electronic Conveyancing

• Electronic Communications Act 2000 s.91

  • Provides that so long as

    • All terms incorporated

    • Date and time of contract is provided for

    • And electronic signatures of persons are certified

      • Then no need to comply with writing requirements of LP(MP)A 1989 s.2

• Land Registration Act 2002 s.91

  • Applies to any disposition of a registered interest or interest protected by notice on the register

    • And means that it must have a valid electronic disposition

      • Which is treated as a deed for statutory purposes.

  • Smith: significance of this goes beyond the simple replacement of conventional documentation

    • Means that all entries will be placed on register electronically

      • So the present three stage test of creating an interest, application to the registry and entry on the register will all be collapsed into one.

• Land Registration Act 2002 s.93

  • This provides that electronic registration is compulsory – not currently in force

    • But s.93 likely to be activated to require dispositions of registered land to be created by electronic registry application

      • Under present law, unprotected interest trumped by registered disposition

      • Under s.93, consequences far more severe.

        • Without electronic entry – no proprietary interest

          • Means no question of any protection of this interest

          • Means that electronic Conveyancing similar to s.2 requirement for writing under LP(MP)A 1989

            • Thus, we’ll have a system of title by registration rather than registration of title

Equitable Leases

• In order to gain an equitable lease, the agreement must be in writing

  • Even though it is not contained in a deed

    • Without writing, will not be effective.

    • Walsh v Londale [1882]:

      • Jessel MR:

        • There are not two estates, one at common law and one at equity

          • There is one court in which the rule of equity prevails

        • T holds agreement for lease

          • He holds it in equity as if it were granted by law

            • That being so, he can’t complain of the exercise of L of the same rights as the landlord would have had if a lease had been granted.

    • McFarlane: on facts, this leads to an implied periodic tenancy in common law...