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Flashcards in Week 4 Deck (34):
1

The doctrine of tenure has 4 dimensions

1. Width
2. Length
3. Height
4. Time (Freehold and leasehold estates)

2

An Estate is regarded as either

a freehold or leasehold estate

3

what is freehold interest

Indeterminate estate in Land (can be held for an indefinite period of time

A freehold estate is a right of title to land that is characterized by two essential elements: immobility, meaning that the property involved is either land or an interest that is attached to or has been derived from land, and indeterminate duration, which means there is no fixed duration of ownership

4

Components of freehold interest

o Fee simple – Largest freehold estate fee (capable of being inherited) simple (no restriction on who can inherit the land)

o Fee tail - An estate inherited by family members (most jurisdictions convert such a grant to fee simple) (historical category) Can be used as a means of keeping land in the Family as alienation of the land is prevented

o Life estate – Estate granted to the life tenant from the fee simple for the life of the person nominated (lesser freehold estate)

5

what is fee simple

Fee simple – Largest freehold estate fee (capable of being inherited) simple (no restriction on who can inherit the land)

6

what is fee tail

Fee tail - An estate inherited by family members (most jurisdictions convert such a grant to fee simple) (historical category) Can be used as a means of keeping land in the Family as alienation of the land is prevented

7

what is life estate

Life estate – Estate granted to the life tenant from the fee simple for the life of the person nominated (lesser freehold estate)

- Estate limited by Reference to a period of time
e.g. lease for period of 3 years
o Fixed term
o Periodic
o At will

8

Explain determinable and conditional interests

o A grant of an interest in land without any conditions attached is regarded as Absolute

o A Determinable condition can be used to limit the duration of an estate by specifying certain circumstances, that will bring an estate to an end

o The form of words of the grant will determine it’s classification (Zapletal v Wright)

o Conditions – Can be used to limit the duration of an interest specifying the conditions that will bring the estate to an end (determinable) or create an estate (subsequent)

o Determinable condition – Regarded as part of the grant of the estate, if void will render the grant void

o Condition Subsequent – Regarded as separate to the grant of the estate, if void will make the grant absolute

9

Difference in conditions

Conditions – Can be used to limit the duration of an interest specifying the conditions that will bring the estate to an end (determinable) or create an estate (subsequent)

o Determinable condition – Regarded as part of the grant of the estate, if void will render the grant void

o Condition Subsequent – Regarded as separate to the grant of the estate, if void will make the grant absolute

10

Rights of owners of freehold estates:

Whatever the nature of the freehold interest estate, the Owner of the estate will have certain rights that are automatically attached to the interest
o Right to alienate their interest
o Right to receive any rents of profits
o To not commit waste (common law and statuary requirement)

11

Right of owners of an estate in fee simple:

o Right to alienate – right to sell, lease or mortgage
o The right to things necessary for the reasonable use of the land
o Right to create lesser interests in the land e.g. life estate or lease

12

explain the doctrine of waste and its components

In order to prove waste you must prove and injury to the inheritance

o Permissive waste – Failure to act, not liable unless an expressed requirement of the grant

o Voluntary Waste – An act committed by the life tenant that has damaged the land. The life tenant will be responsible for the waste unless the grant expressly exempts the life tenant from such damage that may be caused to the land (liable unless exempt by grant)

o Equitable waste – Flagrant and wanton destruction, liable for damage unless the grant expressively exempts the life tenant of such damage

13

what is permissive waste

Permissive waste – Failure to act, not liable unless an expressed requirement of the grant

14

what is voluntary waste

An act committed by the life tenant that has damaged the land. The life tenant will be responsible for the waste unless the grant expressly exempts the life tenant from such damage that may be caused to the land (liable unless exempt by grant)

15

what is equitable waste

Flagrant and wanton destruction, liable for damage unless the grant expressively exempts the life tenant of such damage

16

define future interests

Future interests = interest in which possession is postponed until some precondition permitting possession is met

17

components of future interest

Freehold Estates (outright ownership of land):
o Possession

o Reversion – the residue of the freehold estate after a lesser estate has been granted - future interest left in a transferor or his (or her) heirs. A reservation in a real property conveyance that the property reverts back to the original owner upon the occurrence of a certain event. A future interest left in a transferor or his (or her) heirs. E.g. fee simple after granting of life estate

o Remainder – A remainder will terminate an earlier freehold estate and is postponed by the existence of an existing estate in possession. A remainder is vested or continent (present interest to future enjoyment)

18


Common law rules regarding contingent legal reminders:

1. The remainder was void unless supported by a particular estate – this required that there could be no gap between interests

2. A remainder after fee simple was void. In other words, once the fee simple remainder was granted, the fee simple estate being the most absolute estate, no further interest could be created

3. A remainder was void unless it followed a prior particular estate. In other words, artificial conditions could not be placed on lesser interests in order to shorten ownership

4. The contingent remainder had to be capable of vesting during the existing possessory estate. In other words, the condition on the remainder could not be such that there could not be a gap between interests

19

Rule against perpetuities: (page 52*)

Freedom of property v restraint for future generations
Common Law rule – the future interest must vest no later than 21 years after the life in being at the creation of the interest
o The modern common law rule against perpetuities seeks to impose a limit on the time between the creation of the future interest and the vesting of that interest by requiring that “the future interest vest no later than 21 years after the life in being at the creation of the interest”

Class gifts – One way of extending the perpetuity period is to give a class gift – the interest is not granted to an individual but to./ a group of people that are yet ascertained e.g. grandchildren who would obtain at the age of 18

*But if an interest vests outside the period the whole gift will fail

20

Explain 'class gifts'

Class gifts – One way of extending the perpetuity period is to give a class gift – the interest is not granted to an individual but to./ a group of people that are yet ascertained e.g. grandchildren who would obtain at the age of 18

*But if an interest vests outside the period the whole gift will fail

21

consequences of breaching rule against perpetuities

Where there are a series of successive interests a prior invalidated interest will invalidate the next interest

22

difference between legal and equitable interests

o Legal interests – formalised (enforceable against the world at large)
o Equitable interests – absence of formality
Examples:
Trusts
o Settlor (original owner) – trustee (legal owner) – beneficiaries (equitable interest)
Purchaser under a contract
o Seller (legal interest) – purchaser (equitable interest)

23

Explain the 'requirement of writing'

Conveyance or dispossession of land must be made in writing.

An Oral (Parol) contract for the dispossession of land is unenforceable unless there is evidence of part performance

o The ‘Doctrine of past performance’ read Regent v Millett (page 57*)

24

Explain the hierarchy of equitable remedies

o Equitable interest – interest looks like a right to property

o Mere & equity – some characteristics to the right to property but not the extent of an equitable interest (e.g. right to have sale set aside was mere equity: Latec Investments v Hotel terrigal

o Personal and equity – Right has property characteristics (e.g. right under contract to affix posters was a personal right the right was not connected to the land: King v David Allen

25

Explain enforcement of equitable remedies

The enforcement of equitable interests lies at the discretion of the courts – in other words equitable remedies in every circumstance may or not be granted. If an equitable remedy is not granted by the courts then the equitable interest and any rights that flowed from that interest will be destroyed.
The courts decision to award an equitable remedy will be judged according to the maxims of equity including but not limited to:
o When equities are equal, first in time will prevail
o Those who come to equity must come with clean hands – will not receive equitable remedy if acted dishonestly or unconsciously
o Equity regards as done that which ought to be done
o Equity will not assist a volunteer
o Remedy should be sought within reasonable time

26

equitable remedies

Specific performance – An order directing a person to carry out the obligation (e.g.g Walsh v Lonsdale)
Injunction:
o Prohibitory injunction – prevent or restrain a person from doing something
o Mandatory injunction – Compelling action

27

explain creation of property rights

Registered and unregistered property rights
Important because the Torrens system creates rights and determine priority

General Rule: Property rights are legal if registered otherwise they are equitable (so unregistered)
Some exceptions to Rule:
Adverse Possession – still legal right without registration
Easements (by operation of law) still legal right without registration
Informal Leases - still legal right without registration

28

explain chain of title

A chain of title is the sequence of historical transfers of title to a property.

The "chain" runs from the present owner back to the original owner of the property

29

Explain the torrens system

Common Law – trace the history of dealings – “title deeds” or “chain of title”
o Documents needed to evidence a continuous chain
o Defect in the chain = owner couldn’t show good title
o The practice of English conveyancers was to require the production of documents dating back 60 years
o In Australia, the search commenced by inspecting the Crown grant and then succeeding dealings
Need for system regulating the creation and transfer of interests in land

The Deeds Registration System
o 1825, NSW adopted the Irish system, whereby recording or registering of a deed was not essential to the validity of the deed, but a deed that was recorded took priority.
o Legislation was subsequently passed in all jurisdictions based on this system
o It was a system of registration by instruments

o Most property rights to land and many forms of personal property security are registered
o Statutes create the Torrens system of land registration in Australia
o Land Title Act 1994(Qld)
o Transfer of Land Act 1958 (Vic)
o Real Property Act 1900 (NSW)
o Registers (ideally) present an accurate picture of property rights to land and therefore the rights which adversely affect land

Torrens title is a system of land registration, in which a register of land holdings maintained by the state guarantees an indefeasible title to those included in the register. Land ownership is transferred through registration of title instead of using deeds.
o Legal interest is created once the interest is registered on the titles register
o Legal interest can be enforced against the world at large
o An interest in land that is unrecognised is equitable
o An equitable interest is personal and can only be enforce between the parties involved

30

what are title deeds

legal deed or document constituting evidence of a right, especially to ownership of property.

• Registration is the source of title – it confers title on the person registered as proprietor a title that did not previously exist (previous title is extinguished)

• Registered and unregistered property rights
• Important because the Torrens system creates rights and determine priority

• General Rule: Property rights are legal if registered otherwise they are equitable (so unregistered)
Some exceptions to Rule:
Adverse Possession – still legal right without registration
Easements (by operation of law) still legal right without registration
Informal Leases - still legal right without registration

31

explain priority of registered rights

Registration also determines priority
Priority is governed by order of registration – not by date of execution

Priority between registered rights
Priority over unregistered rights – indefeasibility of title
Survival of unregistered rights
Creation of new unregistered rights

32

explain priority of unregistered rights

Indefeasibility of title *
• Registered right has priority over all unregistered rights (the conclusiveness of the Register confers an interest as indefeasible)
• Foundation of the Torrens system
• Exceptions to indefeasibility – permit unregistered rights to survive the registration of conflicting rights
1. Statutory exemptions
2. Statutory protections
3. Conflicting registered right is acquired by gift
4. Fraud

33

explain cavets

Caveats: caveat is a form of statutory injunction
• An unregistered interest may be protected by a caveat
• A caveat can be lodged to protect a property right
• Examples of when caveats may be lodged:
• Purchaser under a contract of sale
• Interest of a mortgagee
• Interest of a lessee under a lease


• Interest of a landowner with the benefit of a restrictive covenant (will be discussed later in trimester)

34

infeasibility exceptions

• Each jurisdiction’s Torrens statute contains exceptions:
• Common exemptions:
• Prior certificate of title
• Misdescription of boundaries
• Adverse possession
• Short leases
• easements