-Part A- Conveyancing and Land Law

Transcription

1 -Part A- Conveyancing and Land Law Candidates must answer Question 1 and either Question 2 or Question 3. Question 1 (compulsory) Documents provided 1. Contract for sale of "Coburg House" 2. Office copy entries of title number WX You are acting for Elizabeth Windsor who is selling her existing house at 1 Buckingham Gate, London, SW1 ER2 and buying "Coburg House", a large Victorian mansion which once served as the country home of the Coburg family and formed part of Coburg Great Park. Part of the park bordering "Coburg House" was sold a few years ago to a property developer and is now covered by a high density housing estate. Until recently "Coburg House" was used as a home for old people but is now unoccupied and in a poor state of repair. Elizabeth intends to renovate the property and convert it into a number of flats. She will live in one of the new flats and let the others to students from the nearby technical college. Part of the purchase price is being provided from the proceeds of sale of 1 Buckingham Gate, and the rest is coming from a mortgage advance from the Royal Berkshire Bank, for whom you also act. a) State, with reasons, the consents Elizabeth should obtain in order to carry out her proposals, and at what stage in the transaction she should obtain them. Do not at this stage deal with the official copies and title matters. (9 marks) b) What issues on the sellers' title arise from the official copies and how should they be dealt with? (11 marks) c) Explain the amendments you will seek to make to the front page of the draft contract. You are happy to accept the Special Conditions without change. (8 marks) d) Two weeks before completion "Coburg House" is accidentally damaged by fire. What are the rights of the parties against each other under the contract? (5 marks) Total 33 marks

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3 Document 1 AGREEMENT (Incorporating the Standard Conditions of Sale (Third Edition)) Agreement date : Seller : Maurice John Hayward and Janet Susan Hayward both of 22 Maidenhead Rise, Maidenhead, Berkshire, RG21 0NL Buyer Property (freehold) Root of title/title Number Incumbrances on the Property Title Guarantee (full/limited) : Elizabeth Mary Windsor of 1 Buckingham Gate, London, SW1 ER2 : The freehold property known as Coburg House Upper Maidenhead, Berkshire, RG22 0NG registered at HM Land Registry with title absolute : WX : The entries on the Charges Register : Limited title guarantee Completion date : Contract rate : 5% above the base rate of Lloyds TSB from time to time in force Purchase Price : 175,000 Deposit : 17,500 Amount payable for chattels : Nil Balance : 157,500 The Seller will sell and the Buyer will buy the Property for the Purchase Price. The Agreement continues on the back page WARNING This is a formal document, designed to create legal rights and legal obligations. Take advice before using it Signed Seller/Buyer

4 SPECIAL CONDITIONS 1. (a) This Agreement incorporates the Standard Conditions of Sale (Third Edition). Where there is a conflict between those Conditions and this Agreement, this Agreement prevails. (b) Terms used or defined in this Agreement have the same meaning when used in the Conditions. 2. The Property is sold subject to the Incumbrances on the Property and the Buyer will raise no requisitions on them. 3. Subject to the terms of this Agreement and to the Standard Conditions of Sale, the seller is to transfer the property with the title guarantee specified on the front page 4. The chattels on the Property and set out on any attached list are included in the sale. 5. The property is sold with vacant possession on completion. (or) 5 The Property is sold subject to the following leases or tenancies: 6. Standard Condition 5.1 shall not apply.

5 Document 2 HM Land Registry Title Number: WX A: Property Register This register describes the land and estate comprised in the title. UPPER MAIDENHEAD 1. (7 August 1982) The Freehold land shown edged with red on the plan (not required for the purposes of this examination) of the above Title filed at the Registry and being Coburg House Upper Maidenhead, Berkshire, RG22 0NG B: Proprietorship Register This register specifies the class of title and identifies the owner. It contains any entries that affect the right of disposal. Title Absolute 1. (7 August 1982) PROPRIETORS: MAURICE JOHN HAYWARD JANET SUSAN HAYWARD and WALTER ERIC HAYWARD all of 22 Maidenhead Rise, Maidenhead, Berkshire, RG21 0NL C: Charges Register This register contains any charges and other matters that affect the land. 1. A conveyance dated 24 August 1953 made between (1) Albert Rupert Cholmondley Coburg (Vendor) and (2) Edward Plataganet (Purchaser) contains the following covenants:- "The Purchaser to the intent that the covenants hereinafter contained shall bind the said Property into whosesoever hands the same may come and for the benefit and protection of the adjoining and neighbouring properties of the Vendor's retained land known as Coburg Great Park or any part or parts thereof hereby for himself and his successors in title covenants with the Vendor as follows:- (a) that he the purchaser and the persons deriving title under him will use the property hereby conveyed as a single private dwelling house in the occupation of one family only.

6 (b) that he the purchaser and the persons deriving title under him will not carry out or permit or suffer to be carried out any alteration or reconstruction of the property hereby conveyed without the prior consent in writing of the Vendor. 2. (7 August 1982) REGISTERED CHARGE dated 18 July 1982 to secure the moneys including the further advances therein mentioned. 3. (7 August 1982) PROPRIETOR - READING BUILDING SOCIETY of Usury House, Bath Road, Reading, Berkshire. END OF REGISTER NOTE A: A date at the beginning of an entry is the date on which the entry was made in the register NOTE B: This a copy of the register on 3 June 2003 at 11:05:56 NOTE TO CANDIDATES: THE FILED PLAN IS NOT RELEVANT TO THIS QUESTION AND HAS NOT BEEN REPRODUCED

7 Question 2 Ronald McArthur is the freehold owner of a house with a workshop in the grounds. There are two means of access to the workshop, one over Ronald's adjacent garden, and the other from a road on the opposite side. Title is unregistered. Ronald does not have a lot of money and wishes to let the workshop, together with a surrounding area of land, for a term of three years. At present he uses the surrounding area of land as a short cut to the road beyond. a) Will Ronald be entitled to continue to enjoy the short cut over the land he proposes to let, and will the tenant have any rights over Ronald's adjoined house and grounds? (7 marks) b) Ronald's house is mortgaged to the Safe House Building Society, who is not informed by Ronald of his proposals. It finds out after the letting has taken place and writes to Ronald alleging that he is in breach of his mortgage. State, with reasons, whether the Building Society can exercise its powers of sale. (5 marks) c) If the building society sells the property, will the new owner be entitled to evict the tenant? Would your answer differ if, under pressure from the building society, Ronald were the seller? (5 marks) Total 17 marks

8 Question 3 You are acting for Barry and Sheila Sharp who are purchasing a leasehold flat at 15 Barnaby Court for the price of 155,000. Office copy entries (Document 3) and a skeleton outline of the lease provisions (Document 4) are attached. Contracts have been exchanged and the usual 10% deposit paid. The purchasers are obtaining an advance of 130,000 from the Countrywide Building Society (for whom you act) by way of an endowment mortgage. a) What particular matters (if any) arising from the office copy entries will you raise with the seller's solicitors, and why? (6 marks) b) Explain the pre-completion searches you will make and when, before completion, you will make them. (5 marks) c) List and explain the documents to be sent to the Building Society after registration of the transfer to your client. (6 marks) Total 17 marks

9 Document 3 HM Land Registry Title Number: LS A: Property Register This register describes the land and estate comprised in the title. Except as mentioned below, the title includes any legal easements granted by the registered lease but is subject to any rights that it reserves, so far as those easements and rights exist and benefit the registered land BRENT 1. (14 September 1992) The leasehold land shown and edged with red on the plan (not required for the purposes of this examination) of the above title filed at the Registry known as 15 Barnaby Court, Royal Drive, West Finchley, (N28 2PN). 2. (14 September 1992) short particulars of lease under which the land is held Date: 30 August 1967 Term: 99 years from 25 March 1967 Rent: 50 Parties: (1) Star Properties Limited (2) Alice Mary Black B: Proprietorship Register This register specifies the class of title and identifies the owner. It contains any entries that affect the right of disposal. Title Good Leasehold 1. (25 June 1993) PROPRIETOR: MARK HEYWARD OF 15 Barnaby Court, Royal Drive, West Finchley London N28 2PN

10 C: Charges Register This register contains any charges and other matters that affect the land (The charges register is blank) END OF REGISTER NOTE A: A date at the beginning of an entry is the date on which the entry was made in the register NOTE B: This a copy of the register on 29 May 2006 at 09:33:29

11 Document 4 Stamp: 126 PD stamp County: Greater London London Borough: Finchley Property: 15 Barnaby Court THIS LEASE is made the 30th day of August 1967 between STAR PROPERTIES LIMITED whose Registered Office is at 45 Upper Street London EC5 (hereinafter called "the Lessor") of the one part and ALICE MARY BLACK of 6 Selwyn Avenue London W42 Bank Official (hereinafter called "the Lessee") of the other part. WITNESSETH as follows:- 1. The Lessor in consideration of the sum of 12,000 paid by the Lessee to the Lessor (the receipt whereof the Lessor hereby acknowledges) the Lessor demises unto the Lessee the premises described in the Schedule hereto TO HOLD the same UNTO the Lessee for the term of 99 years from the 25th March 1967 YIELDING AND PAYING therefor the yearly rent of 50 payable in advance the first payment to be made on the execution hereof and thereafter on each subsequent anniversary thereof. 2. The Lessee covenants with the Lessor as follows:- (1) To pay rent. (2) To pay service charges for repairing cleansing and lighting the common parts (3) To repair and decorate the interior (4) Not to make alterations. (5) To permit the Lessor to enter and view etc. (6) To repay the landlord the premium for insuring the property. (7) Not to assign or sub-let part only. (8) To give notice in writing to the Lessor's solicitors within 30 days of any assignment or mortgage of the demised premises and to produce the original thereof for registration and to pay to such solicitors a registration fee of 5 in respect of each document produced for registration. (9) To pay the cost of a S.146 notice. (10) Not to use the premises except as a single private dwelling. 3. The landlord covenants with the lessee as follows:- (1) For quiet enjoyment. (2) To insure the Building against the usual perils. (3) To repair cleanse and light the common parts. 3. Proviso for forfeiture for non-payment of rent. IN WITNESS etc. The Schedule

12 The property known as flat 15 Barnaby Court West Finchley London NW12 2PN Signed Sealed and Delivered etc

13 -Part B- Wills, Probate and Administration Candidates must answer Question 1 and either Question 2 or Question 3. Question 1 You are consulted by Mark Sandown concerning the administration of the estate of his father, Justin Sandown, a widower, who died one month ago aged 70. You take the following details:- Relevant provisions from the deceased s valid will dated 1 st June 1996 Appointments: Gifts: I appoint the firm of solicitors, Franklyn, Theodore & Co of Richmond to be my Executors and Trustees. (i) Blade House, Richmond Hill to my daughter, Maria (ii) My 1996 Porsche Turbo sports car to my godson Xavier (iii) 100,000 to my son Mark (iv) I give the rest of my estate to my trustees upon trust for my grandchildren living at my death who achieve the age of 21 in equal shares. No express administrative provisions except for a standard charging clause. Assets Blade House, Richmond Hill, the deceased s home in his sole name 400,000 Mortgage Protection Policy proceeds (payable to the estate) 50,000 Various bank accounts and personal effects 12,000 Quoted stocks and shares (no control) 388, Porsche Turbo sports car 50,000 Deceased s interest in a joint tenancy of a holiday apartment in Cornwall which Justin owned with his sister, Anne (½ share) 100,000 1,000,000

14 Liabilities Mortgage on Blade House 50,000 Funeral account 2,000 Utility bills 1,500 Credit card 6,500 60,000 Further Information The deceased s only surviving relatives are his children, Mark and Maria; Maria s children, Daniel (4) and Patricia (15); and his sister, Anne. In November 2001 Xavier (then aged 20) went on a world tour during a gap year, but two months later all contact with him was lost when he was in the southern Philippines. It is feared he was kidnapped or killed by a terrorist group known to be active in this region. There is no evidence of his fate. Questions (a) In 1996 Franklyn, Theodore & Co (your firm) had seven partners, three of whom died before Justin Sandown, one of whom is serving a term of imprisonment and another retired from practice in In recent years the firm has expanded and now has twenty partners. Explain who is entitled to a Grant. Would your answer differ if there had been no charging clause in the will? (6 marks) (b) Explain which beneficiaries will bear the burden of the various debts in the estate (including the liability for Inheritance Tax). The question does NOT require a calculation of any matter. (7 marks) (c) (d) (e) Mark wants to give his entitlement in the will to Venus, his cohabitee. How would you advise on his effecting this? Mark wants to minimise any negative tax implications of the transfer. (6 marks) Explain how ownership of Blade House, the holiday apartment (both of which are freehold and have registered titles) and the shares will be transferred to those entitled on Justin s death. (6 marks) What actions should the personal representatives take about the gift of the Porsche Turbo Sports car? (4 marks)

15 (f) Concerning the gift of residue: i) At which age will grandchildren become entitled as of right to income? ii) Will there be a charge to Inheritance Tax when a grandchild attains the age of 21? (4 marks) Total 33 marks

16 Question 2 Richard Strauss died intestate in June this year leaving a net estate (after deduction of debts, tax and personal chattels) of 825,000. He left a widow, Susan, a daughter, Cheryl (28), and a grandson, Gerald (17), the son of his deceased daughter, Joy. He has no other surviving relatives. Susan and Cheryl have obtained a Grant of Letters of Administration in respect of Richard s estate and now seek your advice about various matters which have arisen in the course of the administration:- (a) (b) One of the assets in the estate is a mail order business. Susan wishes to continue to run this business which would provide income and an interest for her. Can she do so? (4 marks) Susan has invested her statutory legacy in fixed term investments which cannot be accessed until She now has the opportunity to purchase a share in a profitable hotel business and wants to know if the estate can loan her 50,000 to enable her to do so. What is your advice? Consider whether there are other options relating to the estate whereby this sum could be provided. (8 marks) (c) Gerald lives with his girlfriend, Olivia, and is in financial difficulties. They are unable to pay their utility bills and in consequence all power supplies to their apartment have been disconnected. He also wishes to pay for expensive cosmetic surgery for Olivia. He has asked Susan and Cheryl for some of his entitlement now for these purposes. What is your advice? (5 marks) Total 17 marks

17 Question 3 Edwin Hartley has instructed you to prepare a will for him. He is 39, married, with two children, Carl (aged 8) and Lacey (aged 6). His estate amounts to approximately 500,000. His wife, Jade, has a small personal estate. Mr. Hartley has decided to give most of his estate (the residue) to Jade absolutely with a substitutional gift to his children. (a) (b) (c) Explain the advantages, disadvantages and Inheritance Tax implications of Mr. Hartley leaving an absolute gift to his wife rather than a life interest. (6 marks) Explain the contents of the proposed clause leaving the residuary estate to Jade Hartley absolutely and the substitutional gift. Mention any matters which require discussion with Mr. Hartley but do NOT attempt to draft anything. Do not discuss administrative provisions. (6 marks) Assume for this part of the question only that when the draft will is ready for execution, you learn that Mr. Hartley, recently returned from a vacation in Asia, has fallen seriously ill. He wishes to execute the will in hospital where he is now very weak, slipping in and out of consciousness and unable to write. Explain the procedures and precautions which you will adopt to ensure a valid execution of the will. (5 marks) Total 17 marks

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