A Problem Question in Property Law

1.

The property here is held as a tenancy in common as the words “in equal shares” has been used and the parties have sold and passed on their individual shares indicating their intention that they all own a part of the property as opposed to them all holding the whole of the property. The Law of Property Act 1925 stipulates that the legal estate can only be held by more than one person as joint tenants. A tenancy in common in the legal estate can no longer exist, so that if there is to be a tenancy in common then this must exist behind a trust for sale. As against the outside world (including any landlord) the co-occupiers (who are trustees) can only be joint tenants.

Section 12 of TOLATA 1996 confers a right to occupy where the purposes of e trust include making the property available for such occupation or where the lands is held by the trustees so as to be so available. No right arises where the land is unavailable or unsuitable for occupation. Where two or more beneficiaries have a right to occupy, the trustees may exclude or restrict the entitlement of any of them as long as the trustees act reasonably in doing so. In exercising their power to exclude, restrict or impose restrictions the trustees are, by reason of s13(4), to have regard to the intentions of the person who created the trust, the purposes for which the land is held an the wishes of all of the beneficiaries who would be entitled to occupy^[1]. Therefore on this basis it is likely that the other trustees will be able to sell the property and Beth and Emma will therefore be able to remain at the property.

2.

Easements can come into existence in a number of ways; by express grant (either by deed or in writing), by implication on the sale of part of a property or by prescription.

It has long been established that an easement is no more than a right over land and not a right to either possession or joint and exclusive use of it^[2]. If an alleged right involves the exclusion of the owner of land, it cannot be an easement. The precise scope of this principle has been considered in a number of cases. In Copeland v Greenhalf, above, a wheelwright’s claim to an easement to store vehicles on a strip of adjoining land failed because Upjohn J considered that the right was too extensive to constitute an easement in law; it amounted to a claim to the whole beneficial use of the part of the strip of land over which it had been exercised. In Grigsby v Melville^[3] Brightman J took a similar view of an asserted right to use premises as a store. Nonetheless, in Wright v McAdam^[4], the Court of Appeal had considered that a tenant’s use of a shed in a garden for the storage of coal might be an easement.

Categories of easements have increased since the decision in Dyce v Lady James Hay^[5] and have developed over time to suit modern society. For example it is doubtful at the time of this decision that right to access car parking spaces was a valid or existing easement, whereas such easements are common these days.

If a person has a plot of land and acquires by grant, prescription or other method a “right” to park on adjacent land, can that be an enforceable easement?

In London and Blenheim Estates Ltd v Ladbrooke Retail Parks Ltd^[6] it was recently held at first instance that a right to park can exist as a valid easement but that the grant of a right to nominate additional unspecified land as the dominant tenement of the servient parking land would not create an interest which bound successors to the title to the servient land^[7]. A precedent in Precedents for the Conveyancer, vol 2, 19-60, para 9694,5 seeks to circumvent the Ladbrooke case. It sets out the grant of an option for car parking rights over land to be identified later, by the service of an extension notice within the perpetuity period.

Any argument that for the period of the parking the owner is totally excluded and that this amounts to a claim to exercise rights of ownership seems insupportable in view of Miller v Emcer Products Ltd^[8] There it was held that a grant of a right to use a lavatory in an office created an easement even though, for the period of use, the servient owner was excluded. Romer LJ said that this was a common feature of many easements, such as rights of way, and did not amount to ouster of the servient owner. The person who claims to have an easement of parking must take care not to make such a large claim that he exceeds the basic characteristics of an easement. In Copeland v Greenhalf^[9]a wheelwright claimed as an easement the right to store and repair an unlimited number of vehicles on a strip of his neighbour’s land. He was unsuccessful because the claim amounted to a claim to joint user of the land with its owner or even to exclusive possession. No right of such a wide and undefined nature could be the proper subject matter of an easement.

On a “conveyance” of unregistered land, s 62 of the Law of Property Act 1925 can transform a use of neighbouring land that is enjoyed with the permission of the vendor/grantor into a legal easement. Rule 251 of the Land Registration Rules has exactly the same effect as for straightforward transfers of registered land.

The classic situation in which s 62 can apply is where there is an existing landlord and tenant relationship and the landlord grants a new term to the tenant. Here, it is quite common for the tenant to have enjoyed, by informal permission, some use of land close to the demised land which has been retained by the landlord. For instance, in Wright v McAdam^[10] (as discussed above) the landlord gave his weekly tenant permission to use a shed in the garden for the storage of coal. Later, the landlord granted a new tenancy to the tenant of slightly larger premises (not including the garden). A dispute subsequently arose about the tenant’s continued use of the shed. The court held that the permission to use the shed had, upon the grant of the new tenancy, been transformed into an irrevocable easement.

3. (a)

There are certain formalities that must be met in order that a trust may be valid and one of these is that the donee must have capacity. Capacity is, according to the Oxford English Dictionary “legal competency or qualification.” Although the fact that Uli intended to commit suicide suggests that he may not have capacity, we are told that in fact he was sane.

An express trust cannot be successfully created unless the “three certainties are shown”, these are a certain intention to create a trust, certainty as to the subject and certainty as to the object^[11]. Firstly in relation to certainty of intention there are no key words which will prompt us to assume that it was Alan’s intention to create a trust in Alan’s fathers’ favour and each case will turn on its own merits^[12]. It is considered that the words used are sufficient to create a trust and accordingly there can be said to be certainty of intention^[13].

There can be said to be certainty of object as the trust benefits a particular legal person, .i.e. Alan’s Father. Furthermore there can be said to be certainty of subject matter in so far as the £10,000 exists and can be easily defined however it would seem that the interest of the beneficiary can not be easily defined or at least the extent of the beneficiaries interest is not clearly ascertainable as it simply says that it is for the building of a monument. If the gift were to fail on this point then a resulting trust in favour of the donor will ensue, so it is likely that the court will see this as being definitive enough and all the “future benefit” to be determined by the trustee.

Therefore an express trust in the favour of Alan ‘s father has been created.

(b)

As previously mentioned an express trust cannot be successfully created unless the “three certainties are shown”, these are a certain intention to create a trust, certainty as to the subject and certainty as to the object^[14]. Firstly in relation to certainty of intention there are no key words which will prompt us to assume that it was Alan’s intention to create a trust in favour and each case will turn on its own merits^[15]. It is considered that the words used are sufficient to create a trust and accordingly there can be said to be certainty of intention^[16]. The difficulty here relates to certainty of subject matter. As it is not specified which house should go to whom? The case of Sprange v Barnard illustrates this point where a settlor left some shares to X and all that is remaining after X’s use in trust for A and B equally. Clearly the subject matter of the trust for A and B was uncertain, as there was no certainty as to what would be left after X had made his decisions. A recent case^[17] indicates the same point however this does say that a trust can succeed in certain circumstances. It states that alleged trust over a specific amount of intangible property which, by definition, are indistinguishable from other property of the same type in the hands of the alleged trustee is not void for uncertainty of subject matter because any person calling for the execution for the trust would know, with certainty, whether the trust has been performed. Therefore on this basis it will seem that the trust will succeed

(C)

As previously mentioned an express trust cannot be successfully created unless the “three certainties are shown”, these are a certain intention to create a trust, certainty as to the subject and certainty as to the object^[18]. Firstly in relation to certainty of intention there are no key words which will prompt us to assume that it was Alan’s intention to create a trust in favour and each case will turn on its own merits^[19]. It is considered that the words used are sufficient to create a trust and accordingly there can be said to be certainty of intention^[20]. Furthermore there can be said to be certainty of subject matter in so far as the £100,000 exists and can be easily defined however it would seem that the interest of the beneficiary can not be easily defined and this will give rise to difficulties as to certainty of object.

Certainty of objects requires that the beneficiaries under the trust must either be named individually or be described by reference to a class description that itself is certain in scope. This will fall into the category of a discretionary trust these are trusts where the trustee “is under a duty to select from among a class of beneficiaries those who are to receive, and the proportions in which they are to receive, income or capital of the trust property.^[21]” The test is therefore one of certainty of powers and not of certainty of objects, this trust will not fail simply because the object can not be certain but it will fail if there is no certainty of powers.

The test of certainty for powers can be found in the case of Re Gestetner’s Settlement^[22] is that “if … there be no duty to distribute, but only a duty to consider … there is no difficulty … in ascertaining whether any given postulant is a member of the specified class.” Therefore the test of certainty in relation to powers is not a class ascertainably test, but an individual ascertainability test^[23]. The questions that will therefore have to be asked is whether the words (1) grant the trustees a power of appointment among the class, or (2) subjects them to a discretionary trust.

If the gift is in the form of a power, the trustee Homer will be able to nominate any applicant whom they see fit to receive the money. It would appear that the gift is in the form of a power. On this premise the trust will not fail, however we should consider the situation if it is held that the deed creates a power and not a trust, if this is the case then the list of persons who are entitled will need to be conceptually certain^[24].

One or two difficulties arise with this disposition by Alan, the first is that he has handed to Homer £100,000 but that he has said that most of it must go to the nieces and nephews and not necessarily all of it. It is suggested that the way the law will deal with an incidence where the settlor has successfully completed a trust but yet still leaves a surplus of undisposed property is by way of resulting trust. The law will return the surplus to the donor or his estate under a resulting trust because “equity abhors a beneficial vacuum.^[25]” Therefore Homer will hold the surplus on trust for the estate of Alan.

(d)

Finally the trust created in favour of the dog may fail. An express trust cannot be successfully created unless the “three certainties are shown”, these are a certain intention to create a trust, certainty as to the subject and certainty as to the object^[26]. Firstly in relation to certainty of intention there are no key words which will prompt us to assume that it was Alan’s intention to create a trust in the dogs favour and each case will turn on its own merits^[27]. It is considered that the words used are sufficient to create a trust and accordingly there can be said to be certainty of intention^[28].

There can be said to be certainty of object as the trust benefits a particular legal person, .the dog. There is however not certainty of subject matter If the gift were to fail on this point then a resulting trust in favour of the donor will ensue, so it is likely that the court will see this as being definitive enough and all the “future benefit” to be determined by the trustee. It is suggested that the way the law will deal with an incidence where the settlor has successfully completed a trust but yet still leaves a surplus of undisposed property is by way of resulting trust. The law will return the surplus to the donor or his estate under a resulting trust because “equity abhors a beneficial vacuum.^[29]”

Bibliography

Legislation

• Law of Property Act 1925
• TOLATA 1996

Cases

• Dyce v Lady James Hay (1852) 1 Macq 305
• Grigsby v Melville [1972] 1 WLR 1355
• Hunter v Moss [1993] 1 WLR 934
• Kinloch v Secretary of State for India (1882) 7 App Cas 619
• Knight v Knight (1840) 3 Beav 171
• London and Blenheim Estates Ltd v Ladbrooke Retail Parks Ltd [1993] 4 All ER
• McPhail v Doulton (Re Badens Deed Trusts No 1) [1971]
• Mettoy v Evans [1990] 1 WLR 1587
• Miller v Emcer Products Ltd [1956] Ch 304.
• Paul v Constance [1977] 1 ALL ER 195
• Re Abbotts Trust Fund [1900] 2 Ch 326
• Re Baden’s Will Trusts (No 2) [1972] 2 ALL ER 1304
• Re Gillingham Bus Disaster Fund [1958] Ch 300
• Voice v Bell [1993] EGCS 128
• Wright v McAdam [1949] 2 KB 744

Journals

• Barnsley, (1998) “Co-Owners ‘ right to occupy trust land”, C L J 123

Books

• Birks P, (2002), “Receipt in Breach of Trust”, Hart Publishing, Oxford
• Ramjohn M, (2004) “Cases and Materials on Trusts”, Third Edition, Cavendish Publishing
• Riddall J G, (2002), “The Law of Trusts”, Sixth Edition, Butterworths, Lexis-Nexis
• Todd P & Watt G (2003), “Cases and Materials on Equity and Trusts”, Fourth Edition, Oxford University Press

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Footnotes

^[1] See Barnsley, (1998) “Co-Owners ‘ right to occupy trust land”, C L J 123

^[2] Copeland v Greenhalf [1952] 1 Ch 488

^[3] [1972] 1 WLR 1355

^[4] [1949] 2 KB 744

^[5] (1852) 1 Macq 305

^[6] [1993] 4 All ER

^[7] followed in Voice v Bell [1993] EGCS 128.

^[8] [1956] Ch 304.

^[9] [1952] Ch 488

^[10] [1949] 2 KB 744

^[11] See Lord Langdale MR in Knight v Knight (1840) 3 Beav 171

^[12] See Lord O’Hagan in Kinloch v Secretary of State for India (1882) 7 App Cas 619

^[13] See for Example Paul v Constance [1977] 1 ALL ER 195

^[14] See Lord Langdale MR in Knight v Knight (1840) 3 Beav 171

^[15] See Lord O’Hagan in Kinloch v Secretary of State for India (1882) 7 App Cas 619

^[16] See for Example Paul v Constance [1977] 1 ALL ER 195

^[17] Hunter v Moss [1993] 1 WLR 934

^[18] See Lord Langdale MR in Knight v Knight (1840) 3 Beav 171

^[19] See Lord O’Hagan in Kinloch v Secretary of State for India (1882) 7 App Cas 619

^[20] See for Example Paul v Constance [1977] 1 ALL ER 195

^[21] As per Warner J in Mettoy v Evans [1990] 1 WLR 1587

^[22] [1953] Ch 672

^[23] See McPhail v Doulton (Re Badens Deed Trusts No 1) [1971]

^[24] Re Baden’s Will Trusts (No 2) [1972] 2 ALL ER 1304

^[25] Re Abbotts Trust Fund [1900] 2 Ch 326; See Also Re Gillingham Bus Disaster Fund [1958] Ch 300

^[26] See Lord Langdale MR in Knight v Knight (1840) 3 Beav 171

^[27] See Lord O’Hagan in Kinloch v Secretary of State for India (1882) 7 App Cas 619

^[28] See for Example Paul v Constance [1977] 1 ALL ER 195

^[29] Re Abbotts Trust Fund [1900] 2 Ch 326; See Also Re Gillingham Bus Disaster Fund [1958] Ch 300