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FLK 2 - Land Law > 2. Co-ownership & Trusts > Flashcards

2. Co-ownership & Trusts Flashcards

1
Q

What is co-ownership?

A

Joint ownership of land by two or more people at the same time

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2
Q

What is the general rule regarding legal and equitable estates?

A

Legal estate cannot be held in an undivided share, equitable estate is held on trust.

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3
Q

What is a trust of land?

A

Concurrent sharing of land that creates a trust.

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4
Q

What is an express trust?

A

A trust created through a written declaration by the settlor.

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5
Q

What is an implied trust?

A

A trust created through a person’s conduct without formalities.

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6
Q

Why should a client sign a declaration of trust?

A

It serves as evidence of their intentions.

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7
Q

Who are the trustees in a trust of land?

A

The legal owners with no beneficial entitlement.

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8
Q

Who are the beneficiaries in a trust of land?

A

The equitable owners with beneficial entitlement.

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9
Q

What types of estates can a co-owner hold?

A

Joint tenancy or tenants in common.

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10
Q

What are the requirements for holding legal title?

A

Must be aged 18 or over, maximum of four trustees.

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11
Q

What powers do legal title holders have?

A

All powers of an absolute owner, limited by duty to consult beneficiaries.

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12
Q

What is overreaching in co-ownership?

A

Appointment of a second legal trustee to overreach equitable interests.

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13
Q

What happens to the equitable interest when a co-owner dies?

A

It passes under their will/intestacy to another party.

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14
Q

Who retains legal title when a co-owner dies?

A

The surviving party retains legal title.

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15
Q

What is equitable title?

A

The right to enjoy and benefit from the property.

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16
Q

Who can hold equitable title?

A

Anyone can hold it.

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17
Q

Are there any limits on the number of people who can hold equitable title?

A

No limits.

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18
Q

Is severance allowed for equitable title?

A

Yes, severance is allowed.

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19
Q

What are the two forms of co-ownership?

A

Joint tenancy and tenants in common.

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20
Q

What is joint tenancy?

A

Property owned by two or more people jointly.

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21
Q

What is right of survivorship?

A

On the death of a joint tenant, their interest passes automatically and immediately to the survivor.

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22
Q

What is undifferentiated ownership?

A

Jointly entitled to the whole of the property without having a clear division of share.

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23
Q

What is severance?

A

Can only sever in equity and convert beneficial interests into a tenancy in common - no severance of legal estate.

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24
Q

What is tenancy in common?

A

Property owned by two or more people jointly.

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25
Q

What is the difference between joint tenancy and tenancy in common?

A

No right of survivorship in tenancy in common, and undivided shares with a clear division of share.

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26
Q

What is an express declaration?

A

Must make an express declaration to hold the property as tenants in common, unless there is fraud/mistake as to declaration.

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27
Q

Give an example of when an express declaration is necessary.

A

Unequal contributions to the purchase price of the property.

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28
Q

What are the four unities used to determine joint tenancy or tenancy in common?

A

Possession, interest, title, and time (PITT).

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29
Q

What is the possession unity?

A

No co-owner is excluded from any part of the land.

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30
Q

What is the interest unity?

A

All co-owners hold the same type of interest for the same amount of time.

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31
Q

What is the title unity?

A

All co-owners obtain title from the same transfer deed or lease.

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32
Q

What is the time unity?

A

The interest of all co-owners took effect at the same time.

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33
Q

What does possession unity indicate?

A

It may indicate a tenancy in common.

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34
Q

If all four unities are present, what can the equitable interest be held as?

A

Either a joint tenancy or a tenancy in common.

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35
Q

What is the second test to determine joint tenancy?

A

Does the deed transferring the land contain an express declaration that they are beneficial joint tenants?

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36
Q

What is the third test to determine joint tenancy?

A

Does the deed transferring the land to the co-owners contain words of severance?

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37
Q

What is joint tenancy in equity?

A

A form of joint tenancy that can be severed in equity.

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38
Q

What is presumption in joint tenancy?

A

Equitable interest held as joint tenants.

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39
Q

What is the exception to equal shares in joint tenancy?

A

Unequal shares allowed if co-owner provides greater share of finance.

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40
Q

What happens to the interest when a joint tenant dies?

A

Interest immediately goes to surviving joint tenants.

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41
Q

How can joint tenancy be converted to tenancy in common?

A

Severance of joint tenancy.

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42
Q

What is the effect of severance of joint tenancies?

A

Converts joint tenancy into tenancy in common.

43
Q

What happens when severance occurs with 2 joint tenants?

A

Equal shares in tenancy in common.

44
Q

What happens when severance occurs with 3+ joint tenants?

A

Only the co-owner who severs becomes tenant in common.

45
Q

Who can initiate the severance of joint tenancy?

A

Any of the joint tenants.

46
Q

Can severance occur after death?

A

No, must sever while alive.

47
Q

What are the methods of severance?

A

Notice in writing or certain kinds of behavior.

48
Q

Is individual contribution to purchase price relevant during severance?

A

No, it is irrelevant.

49
Q

What is required for formal severance?

A

Written notice stating irrevocable intention to sever.

50
Q

Does the notice for formal severance need to be signed?

A

No, it does not need to be signed.

51
Q

What must the notice for formal severance express?

A

Desire to end joint tenancy immediately or express a future intent.

52
Q

How should the notice for formal severance be delivered?

A

Received by all other joint tenants through personal service or post.

53
Q

What is an alternative method of delivery for formal severance?

A

Send by registered post, presumed served if not returned undelivered.

54
Q

Does the recipient need to read the severance notice for it to be valid?

A

No, it does not need to be read.

55
Q

Can a notice for severance be withdrawn?

A

Yes, must communicate intent before notice is given.

56
Q

What are the acts that can operate on a joint tenant’s share?

A

Informal severance (no service/notice required).

57
Q

What are the ways to sell or gift a share?

A

To a stranger or fellow joint tenant

58
Q

What is mortgaging or leading a share?

A

Using the share as collateral for a loan

59
Q

What is forfeiture of a lease?

A

Loss of lease due to breach of terms

60
Q

What happens if a joint tenant is declared bankrupt?

A

Severance of their share

61
Q

What is litigation?

A

Legal action or lawsuit

62
Q

What is severance by mutual agreement?

A

Agreement to separate shares

63
Q

What happens if all joint tenants agree to sever?

A

No formalities required

64
Q

What is severance by mutual conduct/course of dealing?

A

Actions indicating separation of shares

65
Q

What is the significance of negotiations in severance?

A

Negotiations indicate intent to sever

66
Q

What are long term assumptions in relation to shares?

A

Discussing future handling of shares

67
Q

What are mutual wills?

A

Wills covering the shares of both parties

68
Q

What does not amount to severance?

A

Physically dividing or leaving the property

69
Q

What is severance by bankruptcy?

A

Involuntary alienation due to bankruptcy

70
Q

What is severance by homicide?

A

Wrongdoer does not benefit from crime

71
Q

What is post-acquisition money management?

A

Both parties responsible for mortgage

72
Q

What evidence is required for respective shares?

A

Evidence of common intention

73
Q

What is Tenancy in Common?

A

Co-owners hold distinct but undivided shares

74
Q

What is the requirement for Tenancy in Common?

A

Unity of possession

75
Q

What happens to equitable interest in Tenancy in Common upon death?

A

Passes under intestacy rules or terms of will

76
Q

What is a resulting trust?

A

Contribution to purchase price without evidence of gift or loan

77
Q

What is a constructive trust?

A

Equitable remedy to prevent unjust enrichment

78
Q

What is the Lloyds Bank v Rosset case about?

A

An agreement + detrimental reliance.

79
Q

When can an agreement be made in relation to the purchase of property?

A

At the time of the purchase or subsequent to it.

80
Q

What must a non-legal owner show in order to rely on an agreement?

A

They must show that they relied on the agreement to their detriment.

81
Q

What are the two factors that can establish an agreement?

A

Conduct and direct financial contribution.

82
Q

What is the process for selling jointly owned property?

A

All the trustees need to execute a deed transferring the legal estate.

83
Q

What does the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA 1996) apply to?

A

All land acts, not just co-owners.

84
Q

What duty do trustees have under s.11 of TOLATA 1996?

A

They have a duty to consult and take into account the wishes of the beneficiaries or a majority of them before selling trust property.

85
Q

What is the general rule under s.14 of TOLATA 1996?

A

Anyone with an interest in land can apply to the court for an order relating to it, such as selling the land or allowing occupation by a beneficiary.

86
Q

Does the court have the power to appoint or remove a trustee?

A

No, the court does not have the power to appoint or remove a trustee.

87
Q

What orders can the court make in relation to the sale of property?

A

An immediate order for sale, postpone sale, split up property, refuse a sale, or make an order regulating the right to occupy.

88
Q

What factors will the court consider under s.15 of TOLATA 1996?

A

Intention, purpose, welfare, creditors, and wishes.

89
Q

What is the court’s consideration regarding the intention of the person who created the trust?

A

The court will consider the intention of the person who created the trust.

90
Q

What is the court’s consideration regarding the purpose for which the trust is held?

A

The court will consider the purpose for which the trust is held.

91
Q

What happens if the purpose of the purchase continues?

A

If the purpose of the purchase continues, it is unlikely that the court will order a sale.

92
Q

What happens if the purpose of the trust has changed over time?

A

If the purpose of the trust has changed over time, the court will consider whether the purpose is continuing.

93
Q

What is the court’s consideration regarding the welfare of minors who occupy or expect to occupy the property?

A

The court will consider the welfare of minors who occupy or expect to occupy the property.

94
Q

What is the court’s consideration regarding the interest of secured creditors of any beneficiary?

A

The court will consider the interest of secured creditors of any beneficiary.

95
Q

What takes priority over the interests of others in the absence of exceptional circumstances?

A

Interests of the mortgagee

96
Q

What will the court consider if the property remains unsold?

A

Rising mortgage debt and risk of wiping out property value

97
Q

What factor does the court consider when determining the wishes of the beneficiaries?

A

Size of their interests

98
Q

What does the court consider when making a decision?

A

All circumstances of the case

99
Q

What are exceptional circumstances?

A

Circumstances beyond normal disruption or disrupted family life

100
Q

What are some examples of exceptional circumstances?

A

Downsizing, going to nursery, or a must-move situation

101
Q

Under what condition can the sale be postponed until the child is 17?

A

If it does not cause significant difficulty to creditors

102
Q

What type of illness may count as an exceptional circumstance?

A

Illness that is proven to be linked to why the house remains unsold

103
Q

How long can the sale be postponed for a schizophrenic beneficiary?

A

1 year

FLK 2 - Land Law (8 decks)

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