SQE1 · Subject page 11 · 7 min read

SQE1 FLK2 subject notes: legal and equitable estates and interests, registered and unregistered title, co-ownership and TOLATA, easements, freehold covenants, mortgages and leases.

What this subject covers

The SRA specification covers:

• The nature of land: real and personal property; how legal and equitable estates and interests are created, transferred and protected; the formalities.
• Title: registration of title (what can be registered, how interests are protected, overriding interests) and the core of unregistered title (title deeds, land charges, the remaining role of notice).
• Co-ownership: joint tenants and tenants in common, survivorship, severance, and disputes under sections 14 and 15 of the Trusts of Land and Appointment of Trustees Act 1996 (TOLATA).
• Proprietary rights: easements, freehold covenants and mortgages.
• Leases: the landlord and tenant relationship, lease or licence, privity, the running of covenants, alienation, remedies including forfeiture, and termination.

Key principles

Estates, interests and formalities

• Only two legal estates exist: the fee simple absolute in possession and the term of years absolute (Law of Property Act 1925, s 1(1)). Legal interests include easements for an interest equivalent to one of those estates and charges by way of legal mortgage (s 1(2)). Everything else, such as a life interest, a restrictive covenant or a beneficial interest under a trust, is equitable.
• A legal estate or interest is created or transferred by deed (s 52), except a lease of up to three years at the best rent taking effect in possession (s 54(2)).
• A contract for the sale of land must be in writing, contain all the terms and be signed by or for each party (1989 Act, s 2). A valid contract for a lease is an equitable lease (Walsh v Lonsdale).
• A declaration of trust of land must be evidenced in signed writing (s 53(1)(b)); a disposition of a subsisting equitable interest must itself be in signed writing (s 53(1)(c)). Resulting and constructive trusts are exempt (s 53(2)).

Registered land

• Freeholds and leases of more than seven years are substantively registered.
• Third-party interests are protected by a notice (agreed or unilateral) or limited by a restriction. A Form A restriction shows that the owners may be tenants in common, so capital money must be paid to at least two trustees.
• A buyer for value takes subject only to interests protected on the register and overriding interests (Land Registration Act 2002, s 29 and Schedule 3), mainly: legal leases of seven years or less; the interests of persons in actual occupation (unless they failed to disclose when asked, or the occupation was not obvious and the buyer did not know); and certain legal easements.
• A spouse's statutory home rights bind a buyer only if protected by notice, never as an overriding interest.

Unregistered land

Registrable interests are land charges, registered against the estate owner's name: for example Class C(iv) estate contracts (including options), Class D(ii) restrictive covenants made after 1925, and Class F home rights. An unregistered land charge of these classes is void against a purchaser of a legal estate for money or money's worth, even one with actual notice (Midland Bank Trust Co v Green). Legal interests, other than a puisne mortgage (a Class C(i) land charge), bind everyone.

Co-ownership

• The legal estate is always held by up to four trustees as joint tenants. In equity, owners may be joint tenants (survivorship applies; the four unities are present) or tenants in common (distinct shares that pass under a will or intestacy).
• Equity presumes a tenancy in common where business partners buy, or where contributions are unequal in a commercial context. For a home in joint names, the starting point is equal beneficial ownership (Stack v Dowden).
• Severance of a beneficial joint tenancy: by written notice (s 36(2), effective on delivery, Kinch v Bullard), or by the methods in Williams v Hensman: an act operating on one's own share, mutual agreement, or a course of dealing. A will cannot sever.
• Overreaching: payment of capital money to two trustees sweeps beneficial interests off the land into the proceeds (ss 2 and 27; City of London BS v Flegg). Payment to one trustee does not overreach (Williams and Glyn's Bank v Boland).
• TOLATA disputes: any person with an interest may apply under s 14; the court weighs the s 15 factors: the settlor's intentions, the purposes of the trust, the welfare of minors occupying the home, and secured creditors' interests.

Easements

• Characteristics (Re Ellenborough Park): a dominant and a servient tenement; the right accommodates the dominant land; different owners or occupiers; capable of grant. A view or a purely commercial advantage does not qualify; parking and recreational rights can.
• Creation: express grant or reservation; implied by necessity, common intention, Wheeldon v Burrows (on a sale of part, quasi-easements that were continuous and apparent, necessary for reasonable enjoyment and in use at the time), or section 62 (which can turn a permission into a legal easement on a later conveyance, Wright v Macadam); or by prescription after 20 years' use as of right (without force, secrecy or permission).

Freehold covenants

• The burden of a positive covenant does not run (Rhone v Stephens).
• The burden of a restrictive covenant runs in equity if it is negative, benefits land of the covenantee, was intended to run, and is protected (by notice in registered land, Class D(ii) in unregistered land) (Tulk v Moxhay).
• The benefit passes by annexation (including statutory annexation under s 78, Federated Homes v Mill Lodge), assignment or a building scheme.

Mortgages

• The power of sale arises once the redemption date has passed (s 101) and becomes exercisable on the s 103 conditions or as the mortgage provides. The lender may choose when to sell but must take reasonable care to get the true market value at that time (Cuckmere Brick v Mutual Finance).
• In possession claims over a dwelling, the court may adjourn or suspend where the borrower is likely to pay what is due within a reasonable period, potentially the whole remaining term (Administration of Justice Act 1970, s 36; Norgan).
• Clogs: a postponement of redemption is valid unless oppressive (Knightsbridge Estates v Byrne).
• Undue influence: a lender is put on inquiry where one party guarantees the other's debts in a non-commercial relationship and must take the Etridge steps.

Leases

• Lease or licence: exclusive possession for a term at a rent creates a tenancy, whatever the label (Street v Mountford).
• Covenants: for leases from 1 January 1996, benefits and burdens pass with the lease and the reversion (Landlord and Tenant (Covenants) Act 1995, s 3), and a tenant is released on lawful assignment.
• Implied repairing obligation: in a lease of a dwelling for less than seven years, the landlord must keep the structure, exterior and installations in repair (Landlord and Tenant Act 1985, s 11).
• Forfeiture needs a forfeiture clause; for breaches other than rent a s 146 notice is needed first. Accepting rent with knowledge of a breach waives the right to forfeit for it.
• Termination: effluxion of time, notice to quit, surrender, merger and forfeiture.

Adverse possession of registered land

After ten years' adverse possession a squatter may apply to be registered. The owner is notified; if it objects, the application fails unless one of three conditions applies, and the owner then has two years to evict before the squatter may reapply (Land Registration Act 2002, Schedule 6).

Worked example

Hugh, the sole registered owner of a house, holds it on trust for himself and his partner Priya, who paid part of the price and lives there. Nothing is on the register. Hugh mortgages the house to a bank, which makes no enquiries.

1. Priya's beneficial interest arises under a trust; it was not overreached because the loan money was paid to one trustee only.
2. She was in actual occupation, obvious on inspection, at the date of the charge, so her interest overrides under Schedule 3, paragraph 2.
3. The bank takes subject to her interest. Had it paid the money to two trustees, or asked Priya and been told nothing, the answer would be different.

Scope follows the SRA's SQE1 Functioning Legal Knowledge Assessment Specification (FLK2, Land Law). The notes are our own summary, not SRA material. Law of England and Wales as at 1 September 2026 (the SRA assesses the law as it stands four calendar months before the first assessment in a window).