SQE1 - Solicitors Qualifying Examination Part 1 Land Law Principles Questions and Answers — Questions and Answers
Question 1: In 1994, a landlord granted a 20-year commercial lease to a tenant (T1). In 2010, T1 assigned the lease to an assignee (T2) with the landlord's consent. In 2012, T2 failed to pay rent. The landlord wishes to recover the unpaid rent. From whom can the landlord legally seek to recover the arrears?
- From either T1 or T2, due to privity of contract with T1 and privity of estate with T2. (Correct answer)
- Only from T2, as T1 was automatically released from liability upon assignment.
- Only from T1, as the original tenant is solely liable for the duration of the term.
- From T2, but only after successfully obtaining a court judgment against T1.
Correct answer: From either T1 or T2, due to privity of contract with T1 and privity of estate with T2.
The lease was granted in 1994, which is before the Landlord and Tenant (Covenants) Act 1995 came into force (1 January 1996). Therefore, it is an 'old lease'. For old leases, the original tenant (T1) remains liable for all covenants for the entire term of the lease due to the doctrine of privity of contract. The current tenant (T2) is also liable for covenants that 'touch and concern' the land (which includes the rent covenant) due to the doctrine of privity of estate. The landlord can therefore choose to sue either T1 or T2 for the unpaid rent.
Question 2: A developer purchased a plot of registered freehold land in 2020. The transfer from the seller contained a covenant requiring the developer and its successors in title 'to construct and forever maintain at its own expense a substantial boundary fence' along the border with the seller's retained land. The developer built the fence but sold the plot in 2023 to a new owner. The fence has now fallen into disrepair. The original seller wishes to enforce the covenant against the new owner. What is the correct legal position?
- The covenant is enforceable because the benefit runs with the retained land.
- The covenant is enforceable as it was correctly protected by a notice on the register.
- The covenant is likely to be unenforceable as the burden of a positive covenant does not run with freehold land. (Correct answer)
- The covenant is enforceable under the principle of mutual benefit and burden.
Correct answer: The covenant is likely to be unenforceable as the burden of a positive covenant does not run with freehold land.
The covenant to 'construct and forever maintain' a fence requires the expenditure of money and is therefore a positive covenant. The long-established rule, confirmed by the House of Lords in *Rhone v Stephens*, is that the burden of a positive covenant does not run with the freehold land either at common law or in equity. Therefore, the original seller cannot directly enforce the covenant against the new owner, who was not a party to the original deed. The other options are incorrect as they do not overcome this fundamental rule.
Question 3: An unmarried couple purchase a house together as beneficial tenants in common to be their family home. They have a young child who lives with them. Following the breakdown of their relationship, one partner moves out and applies to the court for an order for sale under the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA). The other partner, who still lives in the property with the child, wishes to postpone the sale. Which of the following factors is the court required to have regard to under section 15 of TOLATA?
- The welfare of any minor who occupies the land as their home. (Correct answer)
- The financial conduct of the parties during their relationship.
- Whether the resident partner can afford to buy out the other's share within 90 days.
- The wishes of the majority of the beneficiaries, which will be the decisive factor.
Correct answer: The welfare of any minor who occupies the land as their home.
Section 15 of the Trusts of Land and Appointment of Trustees Act 1996 sets out a non-exhaustive list of factors the court must consider when hearing an application for an order for sale. Section 15(1)(c) specifically includes 'the welfare of any minor who occupies or might reasonably be expected to occupy any land subject to the trust as his home'. While other factors like the purpose of the trust and the intentions of the parties are relevant, the welfare of a resident minor is a mandatory consideration and often a very significant one.
Question 4: A woman owned a large house with an adjoining cottage, both set in extensive grounds. She lived in the house and, for many years, accessed the cottage via a clearly defined and tarmacked driveway that crossed the grounds of the main house. She then sold the cottage to a buyer, but the transfer deed made no mention of any right of way over the driveway. The woman now seeks to prevent the buyer from using the driveway. On what basis is the buyer most likely to establish a legal right of way over the driveway?
- By claiming an easement of necessity.
- Under the rule in *Wheeldon v Burrows*. (Correct answer)
- By virtue of section 62 of the Law of Property Act 1925.
- By claiming a prescriptive easement.
Correct answer: Under the rule in *Wheeldon v Burrows*.
The rule in *Wheeldon v Burrows* implies the grant of easements into a conveyance of part of a larger piece of land. The rule applies where the right was 'continuous and apparent' and 'necessary for the reasonable enjoyment' of the part sold, which is the case here with a visible, tarmacked drive that was used to access the cottage before the sale. An easement of necessity is unlikely as it requires the land to be otherwise landlocked. Section 62 is less likely to apply as there was no prior diversity of occupation. Prescription requires 20 years of use as of right, which hasn't occurred since the sale.
Question 5: A legal mortgagee's power of sale has arisen and become exercisable due to the mortgagor's persistent failure to make mortgage payments. The mortgagee intends to sell the property. What is the primary duty owed by the mortgagee to the mortgagor when conducting the sale?
- To obtain the highest possible price, even if it means waiting for several months for market conditions to improve.
- To ensure the property is sold for a price that fully repays the outstanding mortgage debt, interest, and costs.
- To take reasonable care to obtain the best price reasonably obtainable at the time of the sale. (Correct answer)
- To sell the property only by public auction to ensure maximum transparency.
Correct answer: To take reasonable care to obtain the best price reasonably obtainable at the time of the sale.
The established duty of a mortgagee when exercising its power of sale is to act in good faith and to take reasonable care to obtain the 'true market value' or the 'best price reasonably obtainable' at the time of sale. This duty was outlined in cases such as *Cuckmere Brick Co v Mutual Finance Ltd*. The mortgagee is not obliged to wait for the market to improve, nor is their duty simply to cover the debt; they must consider the mortgagor's interest in any surplus equity. They can choose the method of sale (e.g., auction or private treaty) as long as it is a reasonable choice in the circumstances.
Question 6: Under the Land Registration Act 2002, certain dispositions of a registered estate must be completed by registration to operate at law. Which of the following transactions is a 'registrable disposition'?
- The grant of a legal charge. (Correct answer)
- The grant of a lease for a term of exactly five years.
- The creation of an interest under a resulting trust.
- A contract for the sale of a freehold estate.
Correct answer: The grant of a legal charge.
Section 27 of the Land Registration Act 2002 lists the dispositions that must be registered to take legal effect. Section 27(2)(f) explicitly includes 'the grant of a legal charge'. A lease is only required to be registered if its term is for more than seven years (s.27(2)(b)). An interest under a resulting trust is an equitable interest, not a registrable disposition itself, although it can be protected by other means. A contract for sale creates an equitable interest and can be protected by a notice, but it is not the disposition that transfers the legal estate.
SQE1 - Solicitors Qualifying Examination Part 1 Land Law Principles Questions and Answers
In 1994, a landlord granted a 20-year commercial lease to a tenant (T1).
In 2010, T1 assigned the lease to an assignee (T2) with the landlord's consent.
In 2012, T2 failed to pay rent.
The landlord wishes to recover the unpaid rent.
From whom can the landlord legally seek to recover the arrears?