This month in our series of monthly bitesize extracts from Nutcases revision guides, we have an outline of Williams & Glyn’s Bank Ltd v Boland 1980.
A beneficial interest can form the basis of an interest which is capable of being overridden.
Williams & Glyn’s Bank Ltd v Boland 1980: The case
The case merges two actions on materially the same facts. A husband was a registered proprietor of a house. The wife had contributed a large part of the purchase price and the mortgage loan repayments. She therefore had a beneficial interest in the house. He mortgaged the house to the bank, which made no enquiries of the wife. The house was the matrimonial home in which husband and wife resided. The loan was defaulted upon and a possession order was granted.
The wife had an overriding interest of actual occupation under s.70(l)(g) of the Land Registration Act 1925, to which the bank’s interest was subject. Her actual occupation based upon her beneficial interest was more than just a minor interest. Of itself a beneficial interest is registrable as a minor interest.  A.C. 487.
The Land Registration Act 2002 reduces the number and extent of the application of the interests which are capable of being overriding and requires some of these interests to be noted on the register and for such interests to lose its overriding status on being noted on the register. The purpose is so as to enable the register to be as complete as possible. The Act makes a distinction between interests that override first registrations (Sch.1) and those that override registered dispositions (Sch.3). The two schedules contain an overlap but there are also significant differences relating to some others.
Interests which are the same:
There are interests which are the same in both Schs 1 and 3. In paras 4–9 of the schedules, a customary right, a public right, coals and coal mines and associated rights and certain mineral rights in land registered before 1925 retain their overriding status indefinitely.
Paragraphs 10–14 of both Schedules provide for interests which lose their overriding status after 10 years (so as not to breach the Human Rights Act 1998)—hence these will cease to have effect from October 2013. These are a franchise, manorial right and right to rent which was reserved to the Crown on the grant of any freehold estate, a non-statutory right in respect of an embankment or sea or river wall and a right to payment in lieu of tithe.
Interests which differ:
The interests where Schs 1 and 3 differ are as follows:
- Leases granted for less than seven years are interests which are capable of being overriding. Schedule 3 excludes a lease, the grant of which constitutes a registrable disposition from having overriding status. The reason is that a notice protecting such an interest is entered on the title of the superior estate.
- Easements and profits à prendre—A legal easement or profits à prendre is an interest that can override first registration. The Land Registration Act 2002 states clearly that equitable easements are not overriding interests. However, Sch.3 para.3, read together with s.27 of the Land Registration Act 2002 reduces the types of legal easements and profits that can override a registered disposition. For the first three years from the date of the coming into force of the Act, the position of such easements and profits are the same as for first registration, i.e. that they bind the proprietor. After October 13, 2006, an unregistered legal easement or profit will override a registered disposition if it is obvious from a reasonable inspection of the land, known to the person to whom the disposition is made, exercised within the year before the disposition or it is registered under the Commons Registration Act 1965.
- The effect of these provisions is that the only easements or profits capable of overriding a registered disposition are the easements arising from implied grant or reservation, by the operation of s.62 of the Law of Property Act 1925 or by prescription. Section 27 of the Land Registration Act 2002 imposes a requirement that an easement arising by express grant or reservation has to be completed by registration and that it does not operate until it is so registered. Therefore, such interests are not capable of overriding a registered disposition. Once completed by registration, it will be protected by entry on the register of a notice and although such interests could be legal, it is not an overriding interest.
- Interests of persons in actual occupation—this is more narrowly defined than in s.70(l)(g) of the Land Registration Act 1925. In order for such persons to claim an interest that is capable of overriding the claimant’s interest, he or she must be in actual occupation of the property. The Land Registration Act 2002 removes the category of a person in receipt of rents and profits from claiming an overriding interest. If the claimant occupies only part of the land, his interest is only protected as regards that part and not the whole property (Ferrishurst Ltd v Wallcite Ltd  Ch. 355 is no longer good law)— applied in Thompson v Foy  EWHC 1076 (Ch). The interest of a person in actual occupation is not overriding if inquiry is made of that person and he does not disclose his interest when he could reasonably be expected to have done so or if the interest is not obvious on a careful inspection of the land—applies to registered dispositions and not to first registration.
Background: About Registered Title
In the registered title system the estate is substantively registered. Third- party interests are either entered on the register against the substantive registration or are overriding. Legal mortgages are entered as Registered Charges. All other interests not being substantively registrable estates, registered charges or interests capable of being overriding, should be protected by entry on the register in the form of a notice or restriction. This area of the law has been reformed by the Land Registration Act 2002 which was brought into force onOctober 13, 2003. As a result of the changes, a number of the cases on the Land Registration Act 1925 are no longer applicable.
This is an extract from Nutcases Land Law by Chris Chang, available from bookstores and Amazon.co.uk.
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