SQE1 Property Law 1 — Questions and Answers
Question 1: What is the main difference between freehold and leasehold ownership of land in England and Wales?
- Freehold is temporary; leasehold is permanent
- Freehold ownership is permanent and absolute; leasehold gives a right to occupy for a fixed term subject to conditions (Correct answer)
- Leasehold is more valuable than freehold in all circumstances
- Freehold cannot be mortgaged; leasehold can
Correct answer: Freehold ownership is permanent and absolute; leasehold gives a right to occupy for a fixed term subject to conditions
Freehold (fee simple absolute in possession) is the most complete form of land ownership — it is permanent and perpetual. Leasehold gives a right to occupy land for a defined term, subject to covenants, and ultimately reverts to the landlord.
Question 2: Under the Land Registration Act 2002, what is the effect of first registration of a freehold title at HM Land Registry?
- The registered proprietor gains an unimpeachable title that cannot be affected by prior interests
- The title is registered and the proprietor's rights are protected; however, overriding interests still bind without being entered on the register (Correct answer)
- All prior equitable interests are automatically extinguished on registration
- The property is immediately transferred to the Crown if unregistered interests exist
Correct answer: The title is registered and the proprietor's rights are protected; however, overriding interests still bind without being entered on the register
First registration gives the proprietor a registered title, but overriding interests (such as legal easements, short leases, and rights of persons in actual occupation under Sch.3, LRA 2002) bind the registered proprietor even without being noted on the register.
Question 3: What is an 'easement' in land law?
- A right to use someone else's land for a specific purpose that benefits the dominant tenement (Correct answer)
- A right to take something from the land (such as fish or game)
- The obligation to maintain a boundary wall
- A restriction on how land can be used
Correct answer: A right to use someone else's land for a specific purpose that benefits the dominant tenement
An easement is a proprietary right that benefits one piece of land (the dominant tenement) and burdens another (the servient tenement), allowing specific use of the servient land (e.g., a right of way, right of light, or right of drainage).
Question 4: In leasehold law, what is the 'privity of estate' rule?
- Lease obligations bind only the original landlord and tenant
- The obligations under a lease bind the persons who hold the respective estates (freehold and leasehold) for the time being, while that relationship exists (Correct answer)
- All lease covenants are personal and cannot be transferred
- Subleases are automatically void unless registered
Correct answer: The obligations under a lease bind the persons who hold the respective estates (freehold and leasehold) for the time being, while that relationship exists
Privity of estate means that obligations in a lease (under the old law, pre-Landlord and Tenant (Covenants) Act 1995) bind those who stand in the relationship of landlord and tenant for the time being. This concept explains why assignees are bound by covenants that touch and concern the land.
Question 5: What is a 'restrictive covenant' in land law and how does it bind successors in title?
- A positive obligation to do something on land, binding all subsequent owners automatically
- A negative obligation restricting use of land that runs with the burdened land in equity if certain conditions are met (Correct answer)
- An agreement between neighbours that is purely personal and does not bind successors
- A planning permission condition imposed by the local authority
Correct answer: A negative obligation restricting use of land that runs with the burdened land in equity if certain conditions are met
A restrictive covenant is a negative obligation (e.g., not to build) that runs with the land in equity. Under the rule in Tulk v Moxhay [1848], it binds successors if it is negative in nature, benefits dominant land, and the successor took the burdened land with notice of it.
Question 6: Under the standard conveyancing process in England and Wales, at what point do the parties become legally bound to buy and sell a property?
- When the seller accepts the buyer's offer verbally
- On exchange of contracts (Correct answer)
- When the buyer's solicitor conducts searches
- On completion
Correct answer: On exchange of contracts
In England and Wales, parties become legally bound to the transaction only on exchange of contracts. Before exchange, either party can withdraw without legal liability. Completion is when title transfers and money is paid.
SQE1 Property Law 1
What is the main difference between freehold and leasehold ownership of land in England and Wales?