Unregistered land - Continuing role of the doctrine of notic...

Learning Outcomes

This article examines the doctrine of notice in unregistered land and its relationship with Land Charges and overreaching, including:

• identifying the nature of legal and equitable interests in unregistered land and when they may bind purchasers;
• determining precisely when equitable interests bind a purchaser, with reference to the bona fide purchaser rule;
• differentiating and applying actual, constructive and imputed notice, and recognising typical fact patterns that give rise to each;
• evaluating how far purchasers and their solicitors must go in inspections, enquiries and Land Charges searches to avoid constructive or imputed notice;
• distinguishing situations in which the Land Charges regime replaces the doctrine of notice and identifying the correct Land Charge class for common rights;
• analysing the enforcement consequences of registration, non-registration and defective or incomplete name-based searches of the Land Charges Register;
• explaining the interaction between the doctrine of notice, beneficial interests under a trust and statutory overreaching on a sale of unregistered land;
• assessing when payment of purchase monies to two trustees will overreach equitable interests and when a purchaser remains vulnerable to those interests;
• improving exam technique in SQE1 problem questions by structuring answers around interest type, registrability, notice and overreaching.

SQE1 Syllabus

For SQE1, you are required to understand the enforceability of third-party rights in unregistered land, especially the continuing role of the doctrine of notice, with a focus on the following syllabus points:

• the distinction between legal and equitable interests in unregistered land
• the definition and operation of the doctrine of notice (actual, constructive, and imputed notice)
• the requirements for a purchaser to be bound by an equitable interest
• the concept of the bona fide purchaser for value without notice
• the practical implications for buyers, sellers, and their agents in unregistered conveyancing
• which equitable rights must be protected by registration of a Land Charge (and the consequences of failing to register under s 4(6) Land Charges Act 1972)
• how Land Charge registration constitutes deemed notice (s 198 Law of Property Act 1925), and best practice for searching the register against all name variants (s 10 Land Charges Act 1972)
• when the doctrine of notice still applies (pre-1926 equitable interests and beneficial interests under a trust) and how overreaching can defeat such interests if purchase monies are paid to at least two trustees.

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.

1. Which of the following types of notice can bind a purchaser of unregistered land to an equitable interest?
   1. actual notice
   2. constructive notice
   3. imputed notice
   4. all of the above

2. True or false? A purchaser of a legal estate in unregistered land who pays full value and has no notice of an equitable interest will not be bound by that interest.

3. What is the effect of a solicitor's knowledge of an equitable interest on their client in an unregistered land transaction?

4. Which of the following is NOT a legal interest that binds a purchaser of unregistered land regardless of notice?
   1. legal easement by deed
   2. legal mortgage
   3. restrictive covenant
   4. freehold estate

Introduction

In unregistered land, the enforceability of equitable interests against a purchaser is governed by the doctrine of notice. This doctrine is a core principle of English land law and remains highly examinable for SQE1. It determines whether a purchaser of a legal estate will be bound by pre-existing equitable rights, depending on whether they had notice of those rights. The doctrine co-exists with the Land Charges Act 1972 regime: many post-1925 equitable rights are protected by registering a Land Charge; if registration is required but not effected before completion, the interest is void against a purchaser for money or money’s worth of a legal estate (s 4(6) LCA 1972), even if the purchaser actually knows about it. Equitable interests arising under trusts cannot be protected by Land Charges registration; they continue to rely on the doctrine of notice and the overreaching rules. Understanding the doctrine of notice, the Land Charges scheme, and overreaching is essential for advising clients and answering questions on unregistered conveyancing.

Legal and Equitable Interests in Unregistered Land

Unregistered land is land where ownership and interests are proved by title deeds, not by an entry on a central register. It is important to distinguish between legal and equitable interests, as this affects whether a purchaser is bound by them.

Key Term: legal interest
A right in land recognised by statute as legal (such as a freehold, leasehold, legal mortgage, or legal easement by deed) that binds all the world, including purchasers, regardless of notice.

Key Term: equitable interest
A right in land that is not legal, often arising from trusts, failed formalities, or equitable easements and covenants, which may only bind a purchaser if certain conditions are met.

Legal interests bind everyone automatically. Equitable interests, however, are only binding on a purchaser of a legal estate if the doctrine of notice applies or if the interest has been protected by registration as a Land Charge where applicable. Many common equitable rights in unregistered land require Land Charge registration to be enforceable against a purchaser:

• Class C(i): puisne mortgages (a subsequent legal mortgage not protected by deposit of title deeds)
• Class C(iv): estate contracts (including options and rights of pre-emption)
• Class D(ii): restrictive covenants
• Class D(iii): equitable easements
• Class F: home rights under the Family Law Act 1996

Key Term: land charge
An entry in the Land Charges Register (administered by HM Land Registry) recording certain equitable rights affecting unregistered land. Registration is against the estate owner’s name as it appears in the deeds. It constitutes deemed actual notice (s 198 LPA 1925) and ensures the right binds purchasers; failure to register when required renders the right void against a purchaser for value of a legal estate (s 4(6) LCA 1972).

Where a right is registrable as a Land Charge, registration is mandatory to bind a purchaser. Registration of a Land Charge constitutes actual notice to all persons (s 198 LPA 1925). Conversely, if a required Land Charge is not registered before completion, it is void against a purchaser for money or money’s worth (s 4(6) LCA 1972), even if that purchaser had actual knowledge (as confirmed in Midland Bank Trust Co Ltd v Green). Beneficial interests under a trust cannot be protected by Land Charge registration; instead, they rely on the doctrine of notice and the statutory mechanism of overreaching.

Key Term: overreaching
A statutory mechanism transferring beneficial interests under a trust from the land to the purchase money where the purchaser pays capital monies to at least two trustees or a trust corporation (s 2 and s 27 LPA 1925). If overreaching occurs, the purchaser takes free of the equitable interests even if they had notice; the beneficiaries’ rights attach to the proceeds of sale instead.

The Doctrine of Notice

The doctrine of notice determines whether a purchaser of a legal estate for value in unregistered land is bound by an existing equitable interest. The classic rule is that a bona fide purchaser for value of a legal estate without notice of the equitable interest takes free of it. The doctrine is codified in s 199(1) Law of Property Act 1925, which recognises actual, constructive, and imputed notice.

Key Term: bona fide purchaser for value without notice
A person who acquires a legal estate in land in good faith, pays valuable consideration, and has no notice (actual, constructive, or imputed) of any prior equitable interest.

If a purchaser does not meet all these criteria, they may be bound by the equitable interest. Notice is assessed at the time of completion of the purchase. If the equitable right is of a type required to be protected by a Land Charge and has been registered, registration itself is deemed notice (s 198 LPA 1925). If the equitable right is not registrable (for example, a beneficial interest under a trust), the buyer’s diligence and enquiries are central to whether constructive or imputed notice will arise.

Types of Notice

There are three forms of notice relevant to the doctrine:

Key Term: actual notice
Direct, personal knowledge of the equitable interest by the purchaser at the time of purchase.

Key Term: constructive notice
Notice that the purchaser would have discovered if they had made all reasonable enquiries and inspections that a prudent buyer would make.

Key Term: imputed notice
Notice acquired by the purchaser’s agent (such as a solicitor or surveyor) during the transaction, which is attributed to the purchaser.

A purchaser with any of these forms of notice will be bound by the equitable interest (unless overreaching has occurred). Constructive notice places a positive duty on a prudent purchaser (and their solicitor) to:

• inspect the property (inside and out) for signs of occupation or third-party use (the presence of an occupier other than the seller should trigger specific enquiries)
• investigate the seller’s title thoroughly, including the epitome of title and any pre-root deeds if relevant to third-party rights
• make reasonable enquiries of any occupiers and seek full written replies from the seller to standard enquiries (including questions about occupiers, easements, covenants, and options)
• search the Land Charges Register against all relevant estate owners’ names, in the exact form appearing in the deeds and common variants, because entries are name-based in unregistered land

Failing to perform these steps may fix the purchaser with constructive notice of equitable rights they could reasonably have discovered (Hunt v Luck). If a purchaser’s solicitor or surveyor is aware of such matters, that knowledge is imputed to the purchaser (Kingsnorth Finance Co Ltd v Tizard). The questions to ask are: would a prudent purchaser have noticed signs of occupation or third-party use; would proper searches and enquiries have revealed the right; did the agent know (or ought they to have known) and therefore impute that notice?

Worked Example 1.1

Scenario:
Sarah is buying an unregistered house. When she visits, she sees evidence that someone other than the seller is living there. Her solicitor does not ask about this. After completion, the occupant claims a beneficial interest under a trust.

Answer:
Sarah will likely be bound by the equitable interest. The visible occupation should have prompted further enquiry. Failure to investigate means Sarah is deemed to have constructive notice of the interest. If Sarah had instead paid the purchase money to two trustees, overreaching would have detached the beneficial interest from the land, and she would have taken free despite the occupation.

The Practical Effect of Notice

If a purchaser has actual, constructive, or imputed notice of an equitable interest, they will be bound by it, unless statutory overreaching has occurred. If they have no notice, and have paid value for a legal estate in good faith, they take free of the interest. Where an equitable right is registrable as a Land Charge, registration is the purchaser’s decisive notice: registered entries bind; failure to register (before completion) renders the right void against a purchaser for value of a legal estate.

Actual Notice

This is straightforward: if the purchaser is told about the equitable interest, or otherwise knows of it, they have actual notice and will be bound (unless overreaching applies). Actual knowledge will not save a registrable equitable right that was not registered as a Land Charge; lack of registration is fatal against a purchaser for value.

Constructive Notice

A purchaser is expected to:

• inspect the property in person
• examine the title deeds thoroughly
• make reasonable enquiries of any occupants or parties with apparent rights
• search the Land Charges Register against all relevant names shown in the epitome of title, including pre-root names where appropriate best practice suggests they may still affect title

If these steps would have revealed the equitable interest, the purchaser is fixed with constructive notice, even if they did not actually know of it. A common trigger is discovering occupation by someone other than the seller and failing to ask whether they claim an interest. Another is failing to search the Land Charges Register properly against the correct name rendition, which may miss registrable rights (searches are name-based, not title-based, for unregistered land).

Imputed Notice

If the purchaser’s solicitor or other agent knows of the equitable interest, that knowledge is imputed to the purchaser. The purchaser cannot avoid being bound by claiming ignorance if their agent was aware. Imputed notice includes awareness of documents in the deeds bundle mentioning options, covenants, or easements, even if not yet registered (agents must act on such knowledge by performing appropriate searches and raising enquiries).

Worked Example 1.2

Scenario:
A solicitor acting for a buyer of unregistered land discovers a letter in the title deeds referring to a right of way in favour of a neighbour. The solicitor does not inform the buyer, who completes the purchase.

Answer:
The buyer will be bound by the equitable right of way if it was registrable and properly registered as a Land Charge; if it was not registrable but created in equity (for example, by estoppel) and reasonable enquiries would have revealed it, imputed notice will bind the buyer. The solicitor’s knowledge is imputed to the buyer (s 199 LPA 1925), so the buyer is treated as having notice.

The Role of the Doctrine in Modern Practice

The doctrine of notice is now limited mainly to unregistered land. In registered land, the system of registration and overriding interests has replaced it. However, for unregistered land, the doctrine remains central to the enforceability of equitable interests that cannot be protected by Land Charges (beneficial interests under a trust), as well as pre-1926 equitable rights. For post-1925 rights which are registrable as Land Charges, enforceability turns on registration: registration binds; failure to register renders the right void against a purchaser for value, irrespective of notice.

Exam Warning

In SQE1, do not confuse the doctrine of notice (for unregistered land) with the rules for registered land, where registration and overriding interests determine priority. For unregistered land, check first whether the right is registrable as a Land Charge. If it is, registration governs enforceability; if it is not, the doctrine of notice applies.

Revision Tip

Always check whether the interest is legal or equitable, and whether the land is registered or unregistered, before applying the doctrine of notice. For equitable rights in unregistered land, ask: is it registrable as a Land Charge? If yes, registration (or lack thereof) is decisive; if not, analyse actual/constructive/imputed notice and whether overreaching has occurred.

Consequences for Purchasers and Agents

Purchasers of unregistered land must take care to make all reasonable enquiries and inspections. Failure to do so may result in being bound by undisclosed equitable interests (constructive notice). Solicitors and agents must also be diligent, as their knowledge is attributed to the client (imputed notice). Good practice includes:

• inspecting for signs of third-party occupation or use
• raising comprehensive written enquiries (occupiers, easements, covenants, options)
• reviewing all pre-root and post-root deeds in the epitome of title for references to third-party rights
• searching the Land Charges Register against all relevant names exactly as they appear in the deeds, and obvious variants (e.g. former names, alternative spellings, suffixes)
• recording searches and acting promptly on any results (s 10 LCA 1972 makes the search certificate conclusive for a buyer who has properly searched the names attached to the deeds)

Worked Example 1.3

Scenario:
Tom buys unregistered land. He does not inspect the property, and his solicitor fails to ask the seller about a long-standing occupier. The occupier later claims an equitable easement.

Answer:
Tom will be bound by the equitable easement. Both Tom and his solicitor failed to make reasonable enquiries, so Tom is fixed with constructive and imputed notice. Had the solicitor seen references to the easement in the deeds or on site and failed to act, that knowledge would have been imputed to Tom.

Worked Example 1.4

Scenario:
Priya purchases unregistered land. The deeds bundle contains a 1985 deed imposing a restrictive covenant. No Land Charges search was carried out, and the covenant was not registered as a D(ii) Land Charge before completion. Priya knew of the covenant from the deed.

Answer:
The covenant will be void against Priya if it required registration as a D(ii) Land Charge and was not registered before completion (s 4(6) LCA 1972), even though she had actual knowledge. Registration is decisive for registrable rights; knowledge does not substitute for registration.

Worked Example 1.5

Scenario:
A buyer purchases a family home held on trust for the sellers and their adult child. The buyer pays the price to a single trustee only. The adult child claims a beneficial interest.

Answer:
The buyer is at risk of being bound by the child’s beneficial interest unless they are an Equity’s Darling without notice. Overreaching does not occur because purchase monies were not paid to at least two trustees or a trust corporation (s 2 and s 27 LPA 1925). If the buyer had paid two trustees, overreaching would have transferred the child’s interest to the sale proceeds and the buyer would have taken free, irrespective of notice.

Worked Example 1.6

Scenario:
A buyer’s solicitor searches the Land Charges Register against “John A Smith”, the current estate owner shown in the deeds. An earlier deed shows the estate owner in 1990 as “J Andrew Smith”. No further name variants are searched. A C(iv) estate contract registered against “J Andrew Smith” before completion is missed.

Answer:
Because Land Charges are name-based, failing to search against all relevant name variants can result in missing binding entries. Best practice is to search against all names appearing in the epitome of title (including pre-root names where appropriate). If the estate contract was duly registered before completion, it will bind the buyer (s 198 LPA 1925 deems registration to be notice). The s 10 LCA search certificate protects a buyer only where searches are properly conducted against all relevant names.

Summary Table: Legal vs Equitable Interests in Unregistered Land

Key Point Checklist

This article has covered the following key knowledge points:

• In unregistered land, legal interests bind all purchasers automatically, regardless of notice.
• Equitable interests are only binding on a purchaser of a legal estate if the purchaser is not a bona fide purchaser for value without notice.
• Notice can be actual, constructive, or imputed, and includes knowledge held by the purchaser’s agent (codified by s 199(1) LPA 1925).
• Where an equitable right is registrable as a Land Charge, registration is decisive: registration constitutes notice (s 198 LPA) and binds purchasers; failure to register before completion renders the right void against a purchaser for money or money’s worth (s 4(6) LCA 1972), even if the purchaser knows about it.
• Purchasers must make reasonable enquiries and inspections to avoid constructive notice. Occupation by someone other than the seller obliges further enquiry.
• Land Charges searches must be carried out against all relevant estate owners’ names shown in the epitome of title (including variants and pre-root names where appropriate), because the register is name-based for unregistered land.
• Overreaching can defeat beneficial interests under a trust if purchase money is paid to at least two trustees or a trust corporation; the buyer then takes free, irrespective of notice, and the beneficiaries’ rights attach to the sale proceeds.
• The doctrine of notice does not apply to registered land; in registered land, priority depends on registration and overriding interests.
• The doctrine of notice is central to the enforceability of equitable interests in unregistered land which cannot be protected by a Land Charge (for example, beneficial interests under a trust).

Key Terms and Concepts

• legal interest
• equitable interest
• bona fide purchaser for value without notice
• actual notice
• constructive notice
• imputed notice
• land charge
• overreaching