Equity’s darling…..law students beware!

Students are often confused by the rules relating to interests in registered and unregistered land. This is quite a complex issue, and it’s well worth taking the time to ensure that you really understand it (nag your tutor if you need help!). Here’s a quick suggestion that might help…

Most land law text books and lectures on rights in land begin with two good old maxims:

“legal rights bind the world”

and

“equitable rights bind everyone except the bona fide purchaser of a legal estate for value without notice” – also known as “Equity’s darling”

The question is…can you really rely on these good old rules of land law? The answer has to be  ”No!”…not since 1st January 1926 at any rate!

In unregistered land since 1st January 1926 you can almost rely on legal rights binding the world. The only exception being the puisne mortgage (second legal mortgage) which requires registration as a class c(i) land charge in order to bind.

In registered land you cannot safely rely on legal rights binding the world. Since LRA 2002 some legal rights, such as leases for more than 7 years and expressly granted legal easements, now need substantial registration in order to bind a purchaser. Other interests like prescriptive legal easements are usually overriding, but only if certain requirements are met.

So, how about the rule regarding Equity’s darling? Does this hold true for equitable rights? Hardly ever!

In unregistered land since 1st January 1926 most equitable rights require registration as a land charge in order to bind. The only significant exception here is the rights of beneficiaries under a trust, which do remain subject to the doctrine of notice (and overreaching). Otherwise, easements, covenants, estate contracts etc. all need registration as a land charge or they will not bind a purchaser, regardless of  whether he has notice (see Midland Bank Trust Co v Green).

In registered land this rule is even less reliable. The doctrine of notice does not apply in registered land, and equitable interests need protection as agreed or unilateral notices if they are to bind the purchaser.

It would be unthinkable to produce a land law textbook that doesn’t mention these good old maxims, but we do need to treat them with caution…especially when answering problem questions set in the 21st century!

p.s. Equity’s darling might be out of date but God bless Tommy Bowe – Ireland’s darling has just saved the day at Twickenham! Brilliant!

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One Response to Equity’s darling…..law students beware!

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