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Registered Land - From: 1990 To: 1990
This page lists 1 cases, and was prepared on 27 May 2018.
Abbey National Building Society v Cann [1990] 1 All ER 1085; [1991] 1 AC 56; [1990] UKHL 3
29 Mar 1990
HL
Lord Bridge of Harwich, Lord Griffiths, Lord Ackner, Lord Oliver of Aylmerton, Lord Jauncey of Tullichettle
Registered Land
Registered land was bought with an advance from the plaintiff. The transfer and charge were registered one month later, but in the meantime, the buyer's parents moved in. When the buyer defaulted, his mother resisted possession proceedings, saying that she had an overriding interest through her occupation at the time when the charge was registered. Held: The mother's plea failed. When land is purchased using a mortgage, the charge takes effect immediately, and there is no intermediate stage at which the purchaser owns the land free of the charge.
Lord Oliver said: "the relevant date for determining the existence of overriding interests which will "affect the estate transferred or created" is the date of registration. This does, of course, give rise to the theoretical difficulty that since a transferor remains the registered proprietor until registration of the transfer, it would be possible for him in breach of trust, to create overriding interests, for instance, by grant of an easement or of a lease, which would be binding on the transferee and against which the transferee would not be protected by an official search. " However, "A chargee who advances money and so acquires an equitable charge prior to the creation of the occupier's right does not lose his priority because the occupier's right becomes an overriding interest. That interest remains what it always was, an interest subject to the prior equity of the chargee which, on registration, is fortified by the legal estate. Equally, a chargee advancing his money after the creation of the occupier's equitable right is, as one would expect, subject to such right." and
"Nevertheless, I cannot help feeling that it flies in the face of reality. The reality is that, in the vast majority of cases, the acquisition of the legal estate and the charge are not only precisely simultaneous but indissolubly bound together. The acquisition of the legal estate is entirely dependent upon the provision of funds which will have been provided before the conveyance can take effect and which are provided only against an agreement that the estate will be charged to secure them. Indeed, in many, if not most, cases of building society mortgages, there will have been, as there was in this case, a formal offer and acceptance of an advance which will ripen into a specifically enforceable agreement immediately the funds are advanced which will normally be a day or more before completion. In many, if not most, cases, the charge itself will have been executed before the execution, let alone the exchange, of the conveyance or transfer of the property... The reality is that the purchaser of land who relies upon a building society or bank loan for the completion of his purchase never in fact acquires anything but an equity of redemption, for the land is, from the very inception, charged with the amount of the loan without which it could never have been transferred at all and it was never intended that it should be otherwise."
Land Registration Act 1925 70(1)(g)
1 Cites
1 Citers
[ Bailii ]
