PastPaperHero | Introduction to land law

Learning Outcomes

This article introduces the core concepts distinguishing real property (land) from personal property (chattels). It outlines the nature of legal estates and the variety of legal and equitable interests that can exist over land in England and Wales. You will learn the basic requirements for creating and transferring these rights and how formality and registration rules affect whether rights take effect at law or only in equity. It also explains the fundamentals of priority and enforceability in registered and unregistered land, including the role of overreaching and overriding interests. This understanding is fundamental for addressing SQE1 questions involving property rights, their enforceability, and the implications of different forms of land ownership.

SQE1 Syllabus

For SQE1, you are required to understand the basic concepts that define property rights in land, including recognising different types of rights and how they are established, with a focus on the following syllabus points:

The distinction between real property and personal property.
The different ways in which land can be held (estates).
How legal and equitable interests in land are acquired and disposed of.
The legal formalities required to create and transfer interests and estates in land.
Priority and enforceability in registered and unregistered land (including notices, restrictions, overriding interests, and land charges).
Overreaching of beneficial interests and its effect on purchasers and mortgagees.

Test Your Knowledge

Attempt these questions before reading this article. If you find some difficult or cannot remember the answers, remember to look more closely at that area during your revision.

Which of the following best describes 'real property'?
1. Any tangible item owned by an individual.
2. Land and intangible rights associated with land.
3. Money held in a bank account.
4. Moveable items such as furniture.
Which of the following is NOT capable of being a legal interest under s.1(2) Law of Property Act 1925?
1. An easement granted forever.
2. A charge by way of legal mortgage.
3. A restrictive covenant.
4. A right of entry annexed to a legal lease.
What is generally required to create or transfer a legal estate in land?
1. A written contract signed by both parties.
2. A deed.
3. An oral agreement.
4. Registration as a land charge.

Introduction

Land law governs the rights and relationships people have concerning land. For the SQE1 assessment, a clear understanding of the foundational principles is essential. This includes understanding what constitutes ‘land’ in legal terms, the distinction between ownership rights (estates) and lesser rights (interests), and the difference between legal and equitable rights. You must also appreciate the formalities required to create and transfer these rights validly and how registration affects enforceability and priority between competing claims. Finally, knowing when equitable interests are overreached into sale proceeds, and when certain rights override registered dispositions, is important to analysing whether a purchaser is bound.

Key Term: Real Property
Real property refers to land and interests in land. It is generally immovable property.

Key Term: Personal Property
Personal property encompasses all property that is not real property. It includes tangible movable objects (chattels or goods) and intangible rights (like debts or shares).

REAL PROPERTY AND PERSONAL PROPERTY

Property law distinguishes between two main types of property: real property and personal property. This distinction is fundamental as different rules apply to each.

What is Land?

The legal definition of land is wider than its everyday meaning. Section 205(1)(ix) of the Law of Property Act 1925 (LPA 1925) provides a statutory definition:

'Land' includes land of any tenure, mines and minerals (whether held apart from the surface or not), buildings or parts of buildings, and other corporeal hereditaments.
It also includes incorporeal hereditaments such as easements, rights, privileges, or benefits derived from land.

Corporeal hereditaments are tangible elements of land, like the soil, buildings, trees, and rocks, and may also include structures that cannot be removed without destruction. Incorporeal hereditaments are intangible rights over land, such as easements (e.g., a right of way) or profits à prendre (e.g., a right to fish or take timber).

Ownership notionally extends upwards and downwards, but this is limited by modern law:

Airspace: a landowner’s rights extend only to such height as is necessary for the ordinary use and enjoyment of the land. Overflights at normal heights for aviation do not constitute trespass (Bernstein v Skyviews; Civil Aviation Act 1982, s.76).
Subsoil: trespass can occur at depth; however, certain sub-surface resources are vested in public authorities. Rights in crude oil and natural gas vest in the Crown and are explored/extracted under licence (Petroleum Act 1998). Interests in coal are vested in the Coal Authority (Coal Industry Act 1994). Gold and silver (“royal mines”) belong to the Crown. The law of treasure is governed by the Treasure Act 1996.
Running water and wild animals: flowing water and wild animals are not owned until lawfully captured or reduced into possession. Water abstraction for commercial quantities generally requires licensing.

Buildings and parts of buildings are included within the definition of land. A building can be divided horizontally or vertically, creating the possibility of “flying freeholds” and multi-layered ownership.

Fixtures and Chattels

Items brought onto land can either remain personal property (chattels) or become part of the land itself (fixtures). Fixtures pass automatically with the land on sale, whereas chattels do not unless specified in the contract.

Key Term: Fixture
An object which was once a chattel but has become attached to the land in such a way as to be legally considered part of the land.

Key Term: Chattel
A tangible, movable item of personal property that is not considered part of the land.

To determine whether an item is a fixture or a chattel, the courts apply a two-stage test (Holland v Hodgson; Berkley v Poulett):

Degree of annexation: Items attached other than by their own weight are presumed to be fixtures. The more permanent the attachment and the greater the damage caused on removal, the stronger the presumption that the item is a fixture.
Purpose of annexation: Why was the item attached? If attached to improve the land on a lasting basis (e.g., fitted kitchen units, bathroom suites, tiled walls), it is typically a fixture. If attached for the better enjoyment of the item itself (e.g., pictures, curtains, most white goods plugged in by a flex), it is likely a chattel. This purpose test generally prevails.

Illustrations:

Fixtures: built-in oven and hob; fitted kitchen units; bathroom suites; wall tiles; integrated, purpose-built items forming part of an architectural scheme (D’Eyncourt v Gregory).
Chattels: freestanding cooker connected by a flex; carpets and curtains; a gas fire simply inserted to function as a heater; most removable appliances.
Structures: a chalet or structure that cannot be removed without destruction may have become part of the land (Elitestone v Morris). Conversely, a caravan or mobile home that rests on its own weight and can be moved without significant damage will usually remain a chattel.

Precise classification depends on facts and intention; technological advances have made many items easier to affix and remove, so evidence of intended permanence remains important.

Worked Example 1.1

Amina is selling her house. The buyer assumes the large, ornate garden shed, which rests on concrete blocks but is not bolted down, is included in the sale. Amina intends to take it with her. The contract is silent on the shed. Is the shed likely a fixture or a chattel?

Answer:
The shed is likely a chattel. Although large, it rests on its own weight (low degree of annexation). The purpose appears to be for the enjoyment of the shed itself rather than a permanent improvement to the land. Unless it was specifically designed as an essential part of the garden's architecture, it remains personal property that Amina can remove.

ESTATES AND INTERESTS IN LAND

In England and Wales, land is ultimately owned by the Crown. Individuals hold ‘estates’ in land, defining the duration of their ownership rights. Separately, individuals can hold ‘interests’ in land owned by others. Both estates and interests can be either legal or equitable.

Estates in Land

The LPA 1925, s.1(1), recognises only two legal estates:

Fee simple absolute in possession (Freehold): This is the closest equivalent to absolute ownership. ‘Fee simple’ means it can be inherited by any heir. ‘Absolute’ means ownership is not conditional on any event. ‘In possession’ means the owner has the immediate right to enjoy the land (including receiving rent). It can last indefinitely.
Term of years absolute (Leasehold): This grants exclusive possession for a fixed, defined period (e.g., 999 years, 10 years, 6 months). The period must be certain from the outset. A term can be for a day or for a long period and includes periodic tenancies.

Key Term: Estate
Defines the duration for which rights of ownership over land are held. The two legal estates are freehold and leasehold.

Freehold and leasehold estates can co-exist over the same plot: a landlord may retain the freehold while granting one or more leasehold estates. The landlord’s retained interest is called the reversion. Life interests and entailed interests (fee tail) now exist only in equity and usually behind a trust, not as legal estates.

Interests in Land

Interests are lesser rights over someone else's land. Section 1(2) LPA 1925 lists interests capable of being legal:

Easements: Rights over neighbouring land (e.g., right of way, support, drainage) for a duration equivalent to a freehold or leasehold.
Profits à prendre: Rights to take something natural from another's land (e.g., timber, fish, pasture). A profit can be appurtenant (benefiting land) or in gross (held personally).
Rentcharges: A right to receive a periodic sum charged on land independent of a lease. New rentcharges are largely prohibited; most existing ones will be extinguished by 2037 (subject to exceptions for estate rentcharges).
Charges by way of legal mortgage: Security interests created over land to secure repayment of a loan or performance of an obligation.
Rights of entry: For example, a landlord’s right to forfeit a lease for breach of covenant or a right annexed to a rentcharge.

Key Term: Easement
A proprietary right permitting the owner or occupier of one parcel of land (the dominant land) to use or restrict the use of another parcel (the servient land) in a defined way (e.g., a right of way or to use drains).

Key Term: Profit à prendre
A proprietary right to enter another’s land to take part of the natural produce or soil (e.g., fish, turf, timber), capable of being appurtenant or held in gross.

Key Term: Rentcharge
A periodic monetary sum charged on freehold land (independent of any lease). Creation of most new rentcharges is prohibited; existing rentcharges are subject to statutory regulation and extinguishment.

Key Term: Mortgage
A proprietary security interest over land securing a debt or other obligation, typically created by legal charge.

Any other interest (e.g., restrictive covenants, beneficial interests under trusts, estate contracts like options to purchase or rights of pre‑emption) can only exist as an equitable interest (s.1(3) LPA 1925).

Key Term: Restrictive covenant
A promise, typically given on a freehold sale, restricting the use of land (e.g., not to use other than as a private dwelling). The burden may run in equity if conditions are satisfied.

Key Term: Interest
A right that a person has over land owned by another person. Can be legal or equitable.

Legal versus Equitable Rights

The distinction is critical for enforceability, especially against third parties (purchasers).

Legal rights: To be legal, a right must be listed in s.1(1) or s.1(2) LPA 1925 AND created using the correct formality, which usually means a deed (s.52 LPA 1925). In registered land, most new legal rights must also be completed by registration to take effect at law. Legal rights generally bind all subsequent owners of the land (‘bind the world’).
Equitable rights: These include:
- Rights not listed in s.1(1) or s.1(2) LPA 1925 (e.g., restrictive covenants, beneficial interests under trusts).
- Rights listed in s.1(1) or s.1(2) but created without the required formality or without necessary registration (e.g., an easement by deed not completed by registration), often arising via a specifically enforceable contract (Walsh v Lonsdale principle).

Enforceability and priority depend on the system of title:

Unregistered land: Legal interests bind everyone. Equitable interests are protected either by registration as a land charge (Land Charges Act 1972) or, if not registrable, by the doctrine of notice (subject to overreaching of some trust interests).
Registered land: Priority is governed principally by the Land Registration Act 2002 (LRA 2002). Most equitable interests must be protected by a notice on the charges register (s.32 LRA 2002) to bind a purchaser for value (s.29). Some interests override registered dispositions without entry (e.g., certain short legal leases; some legal easements created by implication or prescription; and interests of persons in actual occupation if the conditions of Sch 3, para 2 are met).

Key Term: Deed
A formal written document, which must make clear it is intended to be a deed and be validly executed (signed, witnessed, and delivered), generally required to create or transfer legal estates or interests in land (s.1 LP(MP)A 1989).

Key Term: Notice
In the context of equitable rights affecting unregistered land, 'notice' refers to whether a purchaser knew (actual notice), ought to have known on reasonable inspection and enquiry (constructive notice), or their agent knew (imputed notice) about the right. In registered land, priority is governed mainly by registration and overriding interests rather than notice.

Key Term: Overreaching
A statutory mechanism by which certain equitable interests (notably beneficial interests under a trust of land) are detached from the land and transferred to the purchase money when it is paid to at least two trustees or a trust corporation. A purchaser who overreaches takes free of those interests.

Key Term: Actual occupation
Physical presence or occupation on land that is sufficiently apparent on a reasonable inspection, having regard to the nature and use of the property. In registered land, an occupier’s proprietary interest may override a registered disposition under Sch 3, para 2 LRA 2002 if certain conditions are met.

The classic equitable defense, the bona fide purchaser for value of a legal estate without notice (“Equity’s Darling”), still applies in unregistered land for equitable interests not registrable as land charges (and for certain pre‑1926 rights). In registered land, the priority rules of the LRA 2002 largely supersede notice.

Worked Example 1.2

Ravi agrees in writing, signed by both parties, to grant Sarah a right of way across his garden for the rest of her life. He does not use a deed. Sarah pays Ravi £500. Is Sarah’s right legal or equitable?

Answer:
Sarah’s right is equitable. An easement (right of way) must be for a duration equivalent to a freehold (forever) or leasehold (fixed term) to be capable of being legal (s.1(2)(a) LPA 1925). A right ‘for life’ is an uncertain duration, so it cannot be legal (s.1(3) LPA 1925). Even if for a capable duration, the absence of a deed would prevent it taking effect at law, though the signed writing may create a specifically enforceable contract giving rise to an equitable easement.

FORMALITIES

The creation and transfer of estates and interests in land require specific formalities. Failure to comply often results in the right being equitable or, in some cases, not existing at all.

Legal Estates and Interests:
- Transfer/creation ordinarily requires a deed (s.52 LPA 1925; s.1 LP(MP)A 1989).
- In registered land, most new legal rights are “registrable dispositions” that must be completed by registration to take effect at law. These include:
  - Transfers of registered freeholds and leaseholds (s.27(2)(a) LRA 2002).
  - Legal leases for a term of more than seven years (s.27(2)(b) LRA 2002).
  - Legal charges (mortgages) (s.27(2)(f) LRA 2002).
  - Express legal easements and profits created on or after 13 October 2003 (s.27(2)(d) LRA 2002).
- If a registrable disposition is not completed by registration, it takes effect only in equity (s.27(1) LRA 2002).
- Exceptions: short leases (a term not exceeding three years taking effect in possession, at the best rent reasonably obtainable and without a premium) can be legal without a deed (s.54(2) LPA 1925). Legal easements can also arise by implication or prescription without a deed and, subject to LRA 2002, may override a disposition.
Equitable Interests:
- Contracts for sale or disposition of land interests (including equitable leases/easements arising from contract) must be in a single document incorporating all terms, signed by both parties (s.2 LP(MP)A 1989).
- Declarations of trust concerning land must be evidenced in signed writing (s.53(1)(b) LPA 1925).
- Dispositions of existing equitable interests must be in signed writing (s.53(1)(c) LPA 1925).
- Implied, resulting, and constructive trusts are exempt from formality requirements (s.53(2) LPA 1925).
- Proprietary estoppel can give rise to equitable rights even absent compliance with s.2 LP(MP)A where the assurance, reliance, and detriment make it unconscionable to deny the right.
Protection/priority on disposition:
- Registered land: protect most third‑party rights by a notice on the charges register (ss.29, 32 LRA 2002). Some interests override registered dispositions (Sch 3 LRA 2002), including:
  - Legal leases not exceeding seven years (para 1).
  - Certain legal easements/profits created by implication or prescription (para 3) if they are known, obvious on inspection, or exercised within the year before disposition.
  - Proprietary interests of persons in actual occupation (para 2), subject to the exceptions in para 2(b) and (c).
- Unregistered land: protect most equitable interests by registration as land charges at the Land Charges Department. Failure to register generally renders the right void against a purchaser for money or money’s worth of a legal estate. Beneficial interests under trusts are not registrable as land charges—enforceability turns on overreaching or, failing that, the doctrine of notice.

Worked Example 1.3

Leona agrees to let Sam a shop unit for one year at a market rent starting immediately. They shake hands and Sam moves in and pays monthly. There is no deed and no written contract. What estate (if any) does Sam hold?

Answer:
Sam has a legal lease under s.54(2) LPA 1925. A lease for a term not exceeding three years, taking effect in possession at the best rent reasonably obtainable and without a premium, can take effect at law without a deed. Although there is no written contract and no deed, the arrangement satisfies s.54(2). It is not merely a licence.

Worked Example 1.4

Two years ago, Dana granted Eli a 10‑year lease of a registered shop by deed, but the lease was never registered at HM Land Registry. Eli has been in visible occupation and paying rent. Dana has now sold the freehold to Priya, a purchaser for value, who had inspected the property but did not see the lease referred to on the register. Is Priya bound?

Answer:
The unregistered 10‑year lease takes effect only as an equitable lease because it was not completed by registration (s.27(2)(b) and s.27(1) LRA 2002). As an equitable interest, it should be protected by a notice on the register to bind a purchaser (ss.29, 32 LRA 2002). However, Eli’s proprietary interest may override as an interest of a person in actual occupation under Sch 3, para 2 LRA 2002 if Eli’s occupation was obvious on a reasonably careful inspection, or Priya had actual knowledge, and Eli did not fail to disclose upon enquiry. On these facts, visible occupation likely renders Eli’s equitable lease an overriding interest, binding Priya.

Key Point Checklist

This article has covered the following key knowledge points:

Land law distinguishes between real property (land and rights in it) and personal property (chattels).
The legal definition of land includes physical elements and intangible rights (corporeal and incorporeal hereditaments), but ownership of airspace and subsoil is limited by statute and case law.
Whether an object is a fixture (part of the land) or a chattel (personal property) depends on the degree and, especially, the purpose of annexation.
The two legal estates are freehold (fee simple absolute in possession) and leasehold (term of years absolute).
Interests in land are lesser rights over another's land; only those listed in s.1(2) LPA 1925 can be legal (e.g., easements, profits, mortgages, rentcharges, rights of entry). Others (e.g., restrictive covenants, beneficial interests under trusts, estate contracts) are equitable.
Creation/transfer of legal estates/interests generally requires a deed (s.52 LPA 1925) and, in registered land, completion by registration (LRA 2002); short leases under s.54(2) and implied/prescriptive easements are important exceptions.
Creation/transfer of equitable interests generally requires signed writing (s.53 LPA 1925 or s.2 LP(MP)A 1989), subject to implied trusts and proprietary estoppel.
In registered land, priority is governed mainly by the LRA 2002 through completion of registrable dispositions, entries of notice, and the limited category of overriding interests.
In unregistered land, legal interests bind the world; equitable interests created post‑1926 must be protected as land charges (with failure to register usually rendering them void against purchasers), while some interests remain governed by the doctrine of notice.
Overreaching can free purchasers and lenders from beneficial interests under trusts where capital money is paid to at least two trustees or a trust corporation; the beneficiaries’ rights attach to the proceeds.

Key Terms and Concepts

Real Property
Personal Property
Fixture
Chattel
Estate
Interest
Easement
Profit à prendre
Rentcharge
Mortgage
Restrictive covenant
Deed
Notice
Overreaching
Actual occupation

Introduction to land law - Rights in land