University of Strathclyde

School of Law

ENGLISH AND WELSH LAW

Property and Land Law

Seminar Materials

2018-19

__________________________________________________________________ 1
 Property I: Seminar Materials

These Seminar Materials contain reading lists and questions which are to be prepared
before each seminar. The material in the seminars will follow the material delivered in
the lectures. Given that the lectures are only intended to introduce you to the subject
matter, you will be expected to have read around the subject and you will be expected
to be able to talk about the problems raised in these materials in seminars.

The reading lists contained in these materials are only a guide to your essential
reading. You should refer to your lecture hand-out and your textbook for the
further reading which is necessary to give you a full understanding of this
subject.

The discussion preceding caselists in the lecture should form the basis for your own
work. It is suggested that cases marked with a * should be prepared with some care
and that cases marked ** should be read in the law reports, or at least in a casebook.
You may not be able to get through all of the questions in one seminar, therefore you
should prepare all of them yourself in any event.

Outline of seminars

This page gives an outline for the structure of the seminars for the first semester. The
material considered in seminars will follow lectures on that same material.

1. The distinction between leases and licences

2. Trusts of Homes
3. Proprietary Estoppel
4. Mortgages

Your assessment could be comprised of problem questions and/or essay titles. The
nature of the assessment will be discussed in lectures.

Course co-ordinator: Professor Alastair Hudson – alastair.hudson@strath.ac.uk

Tutors: Alastair Hudson

__________________________________________________________________ 2
Seminar 1

The distinction between leases and licences

The aim of this seminar is to consider the effect of the difference between proprietary
rights and personal rights, and to understand the implications of the decision in Street v.
Mountford for the creation of valid leases. We will also be working closely on your case-
reading and analysis skills, and your problem-answering skills.

Reading:-
Dixon, 219-229
Thompson, 379-389
Study Guide ‘Lease / Licence Distinction’

Understand the detailed rationales in the following cases:-

Somma v. Hazelhurst [1978] 1 W.L.R. 1014
**Street v. Mountford [1985] A.C. 809.
**A.G. Securities v. Vaughan [1990] 1 A.C. 417
**Antoniades v. Villiers [1990] 1 A.C. 417
Ashburn Anstalt v. Arnold [1989] Ch. 1 (C.A.).
*Mikeover v. Brady [1989] 3 All E.R. 618
*Aslan v. Murphy; Duke v Wynne [1989] 3 All E.R. 130

Get the main point in the following cases:-

Crancour v. De Silvaesa (1987) 18 H.L.R. 47
Vandersteen v. Agius (1992) 65 P. & C.R. 26
Norris v. Checksfield [1991] 1 W.L.R. 1241
Hughes v. Greenwich L.B.C. (1992) 65 P. & C.R. 12, C.A., affirmed [1994] 1
A.C. 170 by H.L.
Elvidge v. Coventry City Council [1994] Q.B. 241 (C.A.)

Pre-seminar preparation questions

You should consider these questions as part of your preparation for the seminar, and
be prepared to discuss them briefly in class.

1. Read the cases and answer the following questions

 In Aslan v Murphy, in your opinion, does Lord Donaldson explain clearly

why there is no exclusive possession? Identify the precise passage in which
he sets out a test as clear as that in Street v Mountford?
 In Duke v Wynne, Lord Donaldson observed that it would have been
possible for a lodger to occupy the small, third bedroom and therefore
there could have been a licence in theory: but what exactly is it that makes
Lord Donaldson decide that there was no tenancy? Does he explain this to
your satisfaction? Is he as clear as Lord Templeman in your opinion?

__________________________________________________________________ 3
  What does it mean to look for the ‘true bargain’ between the parties if the
court finds that there was no ‘sham’ (as in Aslan and Duke)? If there is a
sham, then it is clear that the true bargain was something different; but if
there is no sham (as in Duke v Wynne) then what singles the true bargain
out as being something different from the contractual terms signed by the
parties?
 Why is Mikeover v Brady decided differently from Antoniades v Villiers?
This case appears to have very similar facts to Mikeover, so what is the
precise difference between the cases? Can you find the specific part of the
judgment which explains the difference?

2. What is the difference between occupying a hotel room for a week and having
a lease under which rent is payable weekly?

3. Why should there be a different rule in respect of service occupiers compared

to ordinary occupiers?

4. How would you spot a sham?

5. When will paying rent or an occupation charge not constitute a lease?

6. How do you think English law differs from Scots law (if at all) having studied
this area?

Seminar questions

You should be prepared to discuss the following problem questions in the seminar.

7. Susan agreed with Lenny that she would move into a one bedroom flat in the
Mile End area of London. The flat was comprised of a single, large room with a bed
on one side of the room and a sofa and two armchairs on the other side of the room. It
was agreed that the agreement would last for ten years. While both parties signed the
agreement, it was not contained in a deed. The agreement provided that:-

“(1) Susan shall pay £100 per week occupation charge.

(2) Susan will not be a lessee of this flat; the agreement is a mere licence.
(3) Lenny has the right to introduce a third party to occupy the premises at any
time without giving notice to Susan.
(4) Lenny shall provide cleaning services on each Tuesday morning between
9.00am and 11.00am.

Advise Susan as to the nature of her rights.

The following question could be an examination question.

8. Billy and Lily are a married couple. They have recently arrived in London
looking to set up home after leaving their previous home in Germany. They are

__________________________________________________________________ 4
looking for a flat to rent. They noticed an advertisement for a flat in west London
which read: ‘Spacious one-bedroom flat at low rent in Acton. All modern fittings.
Secure. Quiet location. Would suit couple’.

The landlord is Jonas. The couple were given an agreement to sign by Jonas. The
agreement included the following terms:
‘(a) The occupiers shall pay a licence fee for occupation of the property. The
licence fee shall be £1,000 per month plus £100 for utility bills.
(b) The landlord shall be able to introduce any relative or friend to occupy the
property with the occupants.
(c) This agreement creates a mere licence and not a lease. The landlord only
agrees to make the premises available on that basis.’

The property comprises one bedroom with a bed suitable for two people to occupy;
one kitchen; one small bathroom; and a separate living-room with a sofa capable of
accommodating one person to sleep. There is also a small ‘utility room’ containing a
washing machine and tumble dryer which could accommodate a single bed. The utility
room also contains two old suitcases which belong to Jonas and which contain old
clothes.

Billy met the previous occupants Ted and Alice in a coffee shop to discuss the
property. Ted told Billy that Jonas had once arrived drunk at the property at 2.00am
and demanded to be allowed to sleep on the sofa on the living-room. Ted had refused
to allow Jonas to do so, and Jonas had left immediately.

Advise Billy and Lily as to the nature of their rights if they were to sign this
agreement.

We may not have time to reach these last questions. Use them for practice:

9. Posh, Sporty, Scary, Baby and Ginger agreed to lease a flat from Shyster. The
flat had five bedrooms, with shared kitchen, living room and bathroom. Shyster left it
to the five friends to decide who had which room. Bossy Ginger occupied the largest
bedroom but the other rooms were much the same size. Shyster retained a right to
introduce a new tenant if one of the others left. He also had the right to introduce a
tenant whenever he wanted to live in the living room on the sofa, provided he cut the
rent paid by the others. Ginger moved out of the flat, to take singing lessons
elsewhere, and so the other four moved their friend Kylie in. Shyster agreed to the
change. Scary took over the largest bedroom. Shyster wishes to argue that they only
had a licence. Advise him.

10. Susan agreed with Lancelot that she would move into a one bedroom flat in
Mile End. It was agreed that the agreement would last for two years. While both
parties signed the agreement, it was not contained in a deed. The agreement provided
that:-

__________________________________________________________________ 5
 “(1) The occupant will not be a lessee of this flat; the agreement is a mere
licence.
(2) Susan shall pay £100 per week occupation charge.
(3) The landlord shall provide cleaning services on each Tuesday morning
between 9.00am and 11.00am.”

Advise Susan on her rights.

__________________________________________________________________ 6
Seminar 2

Trusts of homes / Acquisition of rights in the home

Hudson, Ch.15
Dixon, Ch.4, but only 168-189
Thompson, Ch.9: 289-337

You must understand the principles in the following cases for the purpose of
answering problems:-

Gissing v. Gissing [1971] AC 886; [1970] 3 WLR 255

*Lloyds Bank v. Rosset [1990] 1 All ER 1111, [1990] 2 WLR 867
Springette v. Dafoe (1992) HLR 552; [1992] 2 FLR 388
McHardy v. Warren [1994] 2 FLR 338
*Midland Bank v. Cooke [1995] 4 All ER 562
Cox v Jones [2004] 3 FCR 693
*Stack v Dowden [2007] UKHL 17, [2007] 2 WLR 831
**Jones v Kernott [2011] UKSC 53, [2011] 3 WLR 1121, [2011] 3 FCR 495

Pre-seminar questions

Read the cases listed above and then think about the following questions:-

1. How does a person acquire proprietary rights in their home in England and
Wales?

2. How does the law work in this area? Are there “rules” or are there
“principles”? Which approach do you prefer?

3. Is there really a doctrine of precedent in this area? How do we explain judges

disagreeing with one another in this fashion?

4. What is the law after Jones v Kernott?

Seminar questions

The following question could be an exam question:-

5. Jeremy and Harriet were a married couple who bought a house together in
August 2015 for £250,000. Jeremy was a financial advisor, aged 40; whereas Harriet
was a deputy head-teacher in a school, aged 40. They both earned £50,000 per annum.
They had one child who suffered from a rare illness which the couple had decided to
treat privately.

__________________________________________________________________ 7
The purchase of the house was funded by way of a mortgage from Steel Bank. The
mortgage was taken out in Jeremy’s sole name because Jeremy was to be solely
responsible for the mortgage. The legal title over the house identified both of them as
being joint tenants. Harriet was to be solely responsible for the cost of their child’s
medical care, as well as for the cost of all utility bills and so forth. The couple had
decided this one Saturday morning when they had gone through their finances. They
had not discussed who would own which share of the property.

Harriet had befriended the vendor of their house and had agreed with him that the sale
price would be reduced by £10,000 if they allowed him to store his belongings in the
garage for six months after the sale.

Both Jeremy and Harriet put their savings into the replacement of the kitchen and the
bathroom. Harriet paid for the house to be redecorated during the summer vacation
from school. She designed and supervised the decoration work which was agreed by
everyone to have transformed the unattractive house into an attractive modern
property.

By January 2016, Jeremy had developed a serious gambling problem and depression.
As his gambling problem deteriorated and used up a lot of the couple’s money, Jeremy
failed to make all of the repayments on the mortgage. He hid this fact from Harriet
because he knew that they could not afford to pay the arrears while also paying for
their child’s care. Steel Bank are now seeking to repossess the house.

Advise Jeremy and Harriet as to their rights in the property.

6. ‘A concept of fairness is no way to organise a system for rights in the home.

The idea of common intention is no way to organise rights in the home. The law in
England and Wales has got itself twisted into an appalling mess. But then again, life is
messy. Aristotle was right: we need a concept of equity which will reach just
outcomes in individual cases.’ Discuss.

__________________________________________________________________ 8
Seminar 3

Proprietary estoppel

The aim of this seminar is to understand the distinction between common law
and equity. The particular focus of this seminar will be on the possibility of using
proprietary estoppel to enlarge rights which might otherwise be merely a licence
into being some form of proprietary right under the proprietary estoppel
doctrine. The reading focuses primarily on explaining what equity is; for
information as to the nature of proprietary estoppel you should refer to the cases
on that topic in the lecture course documents hand-out.

Hudson, Ch.13
Dixon, Ch.9, 365-401
Thompson, Ch.15, 550-592

(1) Making out the estoppel:-

Pascoe v. Turner [1979] 2 All ER 945
*Re Basham [1987] 1 All ER 405, [1986] 1 WLR 1498
*Gillett v. Holt [2000] 2 All ER 289
Jennings v Rice [2002] EWCA Civ 159, [2003] 1 P&CR 100
Lissimore v Downing [2003] 2 FLR 308

(2) Making out the estoppel in commercial situations:-

Cobbe v Yeomans Row [2008] 1 WLR 1752 HL
*Thorner v Major [2009] 1 WLR 776 HL

(3) Remedies:-
Baker v. Baker [1993] 25 HLR 408
Gillett v. Holt [2000] 2 All ER 289
Jennings v Rice [2002] EWCA Civ 159, [2003] 1 P&CR 100
Porntip Stallion v Albert Stallion (Holdings) Ltd [2009] EWHC 1950 (Ch),
[2010] 1 FCR 145

Pre-seminar questions

Consider the following questions as part of your preparation:-

1. What is the role of equity within the English legal system? What are the
sources of its principles?

2. What remedies will a claimant have under proprietary estoppel? What was the
remedy in Porntip v Albert Stallion Ltd? What kind of law is that?

__________________________________________________________________ 9
3. Anastasia invites her friend Jocasta to stay for the weekend in her one-
bedroom flat over which she has an eighty-year lease. Anastasia said to her: “make
yourself at home – you can stay as long as you like”. Jocasta sleeps on the sofa in the
living room: a room which no one else is therefore able to use during that weekend. At
the end of the weekend, Jocasta announces that she is refusing to leave: instead she
wants to stay in the living room “because no one else seems to use it”. What is her
legal / equitable position? And why?

4. ‘The doctrine of proprietary estoppel has been described by different judges as

arising on the basis of compensating detriment, or enforcing promises, or preventing
unconscionability. The remedies that have been awarded range from freehold interests
in property through to mere awards of cash. There is no coherence in this doctrine.’
Discuss.

Seminar questions

This question covers both trusts of homes and proprietary estoppel:-

5. Stella and Kathleen are a couple who bought a house together on 3rd April
2013 for £400,000. The purchase was funded in part by means of a gift of £50,000
from Stella’s parents which was made, according to the card in the envelope
containing the cheque, “to both of you as you start your life together”. The remainder
of the purchase price was provided by way of a mortgage from Profit Bank in Stella’s
sole name. The property was registered in Stella’s sole name at the Land Registry.

The vendor of the house had been a school-friend of Kathleen. Kathleen had
convinced the vendor to reduce the price of the property by £20,000 down to the sale
price of £400,000.

As Stella said over dinner the night before they signed the paperwork to complete the
sale of the house: “This will be our home together.” Kathleen agreed. In April 2013,
Stella was aged 25 and had a bright career working in a law firm. Kathleen, aged 30,
was finding it difficult to find work as a freelance graphic designer. The house was a
small terraced house in Hove in south-east England. The couple decided that they
wanted to have a baby by artificial insemination. Kathleen was to be the birth-mother.
They had bought the house to provide a home for all three of them. In December
2013, Kathleen gave birth to their first child. Kathleen stayed at home to take care of
the baby and to supervise the extensive alteration works which were being done on the
interior of the property.

Stella made all of the mortgage repayments. Kathleen stopped work to look after the
child while she supervised the building work and the decoration of the property.
Kathleen and Stella paid for the building work, which cost £50,000, out of their joint
savings. The value of the property increased by £200,000 over these two years, at least
half of which is considered by professional valuers to be due to the improved
decoration and design to the interior.

__________________________________________________________________ 10
When the building work was finally finished on 1st April 2015, Kathleen said: “I hope
all this work means that I have earned some rights in this house”. Stella replied: “You
know this is our home. Both of us together, and the baby. It always has been.”

Stella continued to pay all of the mortgage repayments until she fell suddenly ill in
July 2015. Her condition has declined rapidly and she has not been able to work since
July 2015. The doctors think it unlikely that she will ever be able to work again. In
January 2016 she was made redundant. Kathleen has therefore recommenced work
and has made all of the mortgage repayments since January 2016, and has paid for all
of the other household expenses (including childcare) since then. Kathleen is however
having difficulty earning enough money. The couple fear that Profit Bank will seek a
sale of the property.

Advise Kathleen and Stella as to their respective rights in the property.

6. ‘Proprietary estoppel is a mechanism for achieving fairness where the law

would otherwise cause injustice to the claimant. By contrast, common intention
constructive trusts are too rigid and are likely to lead to unfairness. Consequently, the
doctrine of proprietary estoppel is the definitive equitable doctrine because it
promotes just outcomes, something which is necessary in any system of land law.’
Discuss.

7. Why does Equity require detriment? Should Equity be careful to enforce

promises and not require either consideration in contract law or detriment in estoppel?

__________________________________________________________________ 11
Seminar 4

Mortgages

The following questions deal with the subject of mortgages generally. You are
expected to focus on the unrefined principles surrounding the recovery of
property by mortgagees, or their preference in some cases for keeping the
mortgage alive.

Reading:-
Dixon, Ch.10, 402-453
Thompson, Ch.12, 426-494

*ss.88, 91, 101-105 LPA 1925

*Cuckmere Brick v. Mutual Finance Ltd. [1971] Ch. 949
Tse Kwong Lam v. Wong Chit Sen [1983] 3 All ER 54 PC
China and South Sea Bank Ltd. v. Tan Soon Gin [1990] 1 AC 536
Parker-Tweedale v. Dunbar Bank plc [1991] Ch. 12

*Palk v. Mortgage Services Funding plc [1993] 2 WLR 415

Cheltenham & Gloucester B.S. v. Krausz [1997] 1 All ER 21

* Royal Bank of Scotland v. Etridge [2001] AC 1

*Barclays Bank v. O’Brien [1994] 1 AC 180
CIBC Mortgages v. Pitt [1994] 1 AC 200
Massey v. Midland Bank [1995] 1 All E.R. 929
TSB Bank v. Camfield [1995] 1 All ER 951
*Halifax Mortgage Services Ltd. v. Stepsky [1996] Ch. 1; [1995] 4 All ER 656

Pre-seminar questions

These questions are intended to guide you as you prepare for your seminar.

1. What rights does a mortgagee have to recover its mortgage debt?

2. What rights does a mortgagor have to resist repossession of their home? When
can a mortgagee’s rights be limited?

3. What rights do other people have in relation to mortgaged property?

4. What motivated Lord Browne-Wilkinson in Barclays v O’Brien to make the

development that he did? What does equity achieve in situations like this?

__________________________________________________________________ 12
Seminar Questions

We will consider the following questions in the seminar.

5. In 2010 the bank lent £150,000 to Dipali, who was buying a flat for £160,000.
The loan was secured by a registered charge over the flat. Because of the property
slump the flat is now worth only £135,000 and Dipali is in arrears with the
repayments. She wants to sell the flat before its value drops any further but the bank
wants to take possession and lease it until the market improves. Advise Dipali.

6. James purchased Hillside (registered land) in 2012. In order to find the

purchase price he borrowed £150,000 from a finance company, Stab-in-the-Back plc,
secured by a registered charge on Hillside. The charge included terms that it could not
be redeemed within the first ten years and that the capital and interest were to be
index-linked to the Deutsche Mark. James inherited some money last year and now
wishes to pay off the mortgage on Hillside, but Stab-in-the-Back plc claims that he is
not entitled to do so until 2042. Due to the decline of sterling in relation to the euro,
the capital and interest debt is now £250,000. Advise James.

The following question could be an examination question:-

7. Tom and Meg were an unmarried couple who had lived together since 2000 in
a large detached house in Surbiton, held in their joint names. Tom and Meg had run a
dating website business jointly since 2000. Meg was responsible for the creative side
of the business, whereas Tom typically took charge of the financial and business
related matters. All of the business profits were paid into a joint bank account with
Profit Bank. The couple were well-known to Profit Bank as a result.
In 2016, Tom decided to leave Meg and move to Brazil. Therefore, Tom
needed some money quickly. Tom told Meg that he had decided to enter into a
business venture on his own, selling used cars. Meg was initially supportive of his
plan. Tom arranged for a second mortgage over the Surbiton house for £50,000 with
Profit Bank. Meg had been told the amount of the loan would only be £10,000.
The mortgagee insisted that Meg must sign the mortgage. Tom had told the
mortgagee that Meg would be a co-partner in the used car business. The mortgagee
nevertheless insisted that Meg must receive independent legal advice. Tom suggested
that the mortgagee and Meg should all use Tom’s childhood friend and solicitor,
Flashman. The mortgagee agreed to this arrangement because they had used Flashman
before.
Flashman knew that Tom was planning to leave Meg and to abscond with the
money but did not tell Meg this. Flashman met Meg at the Surbiton house and advised
her to sign the mortgage. Meg had developed great reservations about the used car
venture. After Flashman left, Tom flew into a rage and threatened to leave her if she
did not sign the agreement. Meg signed the agreement and a certificate stating that she
had received independent advice.
Tom has now fled to Brazil with the money. The mortgagee is seeking to
exercise its power to sell the house.
Advise Meg.

__________________________________________________________________ 13
8. ‘The doctrine of undue influence and misrepresentation as set out in O’Brien
constitutes a charter for unscrupulous rogues to avoid their liabilities under mortgage
agreements.’ Discuss.

END

__________________________________________________________________ 14
 Specimen Examination Paper

You must answer ANY TWO questions

Time: 2 hours

Question 1

Angela and Terry saw an advertisement for a flat in London on the internet. It read:

‘Cheap flat for rent. Would suit couple or two individuals sharing. References
required.’

The landlord was Susan. Angela and Terry met with Susan to view the flat. The flat
comprised one bedroom with a double bed; one bathroom with a bath and shower; one
kitchen; one utility room with enough room for a washing-machine and some
shelving; and one living-room.

Angela asked Susan: ‘How could two people possibly share this flat if they weren’t a
couple?’

Susan answered: ‘The sofa folds out into a bed, or we could probably do something
with the utility room.’

Susan gave them a document to look at. It was titled ‘Licence Agreement’ and
contained the following clauses:

(1) The landlord has the right to introduce any third person she chooses to occupy
the property with the occupants.
(2) The occupants will be separately responsible for half of the licence fee of £800
per calendar month, but the landlord reserves the right to recover the balance
from the other occupant.
(3) The occupants shall be required to leave the property every day between
10.30am and 12.00pm.

Susan has also offered to provide a cleaner for the property if Terry and Susan paid an
extra £80 per month.

Nothing has been signed yet.

Advise Terry and Susan as to their rights if they signed the agreement, and advise
them generally.

__________________________________________________________________ 15
Question 2

Tariq and Zena met at law school in London. They have been an unmarried couple for
ten years. Both of them work as solicitors in the same legal firm. In terms of her
career, Zena has been the more successful member of the couple. She was recently
appointed a partner in the firm and now receives an income of £250,000 per annum.
Tariq is paid £80,000 and is not a partner.

They bought the freehold interest in a house in suburban London in 2010 for
£440,000. The legal title in the property was registered in their joint names. The
purchase was funded in the following way. Tariq’s parents provided the couple with a
gift of £40,000 “towards your first proper home together” which was to be the deposit
on their house. The remaining £400,000 was provided by way of a mortgage which
was taken out in the couple’s joint names. The mortgage repayments were made out of
a joint bank account.

Tariq had known the vendor of the house from their days on the university football
team. He negotiated a reduction in the purchase price of the house of £20,000 on the
basis that Tariq would provide the vendor with some free legal advice.

The couple had a discussion about their family expenses in 2010. As a result, Tariq
paid for the lease on their car, the broadband bill and for both of their mobile phones
throughout their relationship. Zena paid for all utility bills and for their holidays. They
did not discuss their property rights in the home.

In 2014, Zena became pregnant. She took a break from work, including one year
unpaid, so that she could spend time with their child. Their child required constant
medical care. Zena used her savings to pay for that medical care. Tariq was the only
person earning an income during that year. Therefore, Tariq took sole responsibility
for the mortgage during that period of time. Paying the mortgage used up all of Tariq’s
spare income.

Zena has discovered that Tariq has been unfaithful to her. Consequently, Zena now
wants to leave Tariq.

Advise Zena as to her rights in the house.

Question 3

Ana began a relationship with Steve in 2010. It was a casual, sexual relationship at the
outset. The couple dated once or twice per week for two years. In 2012, Ana lost her
flat and Steve agreed to allow her to move into his house in London. Steve was a
wealthy lawyer.

Before Ana moved into the house in 2012, Steve said: ‘I really want a serious
relationship. I want to have children in the future. If you agree with that, then I agree
that we should live together.’ Ana agreed and moved all of her belongings into the
house. Ana will testify that she was caught up in the romance of the moment and that

__________________________________________________________________ 16
was why she agreed. Ana will also testify that she believed Steve was entirely serious
at the time.

Ana agreed to pay the utility bills over the house from 2012 onwards, while Steve paid
for the mortgage. Ana also paid for their annual summer holiday.

Ana was an artist. In 2013 she sold some of her artwork for the first time. Ana left her
job as an office receptionist and concentrated on painting full-time. Her income rose
from £20,000 per year to £200,000 per year as a result. In 2014 Ana began to
contribute half of the mortgage repayments. As Steve said: ‘Now that you’re so
wealthy, I guess we should be equal partners in everything we do’.

Ana was uncertain about having children and so it was not until 2015 that she stopped
using contraception and allowed herself to become pregnant. Steve was delighted. On
hearing the news that Ana was pregnant, he said: ‘I want us to be a happy family and
for this to be our home. All three of us.’

In 2016, the couple agreed to construct an extension to the house. Ana agreed to pay
for all of the construction work. She spent all of her savings of £200,000 on the work.
The house was worth £600,000 before the construction of the extension and worth
£850,000 afterwards.

Steve has now decided that he wants to end their relationship and has had a new
girlfriend living in the house for the last six months. Ana has been living with their
child in the extension for six months while the couple have been taking legal advice.

Advise Ana as to any rights she may have acquired under proprietary estoppel
principles.

Question 4

Mary was married to Charles. Charles ran a small construction business. The business
fell into financial difficulties. Charles approached Racket Bank for a second mortgage
to be secured over the matrimonial home which he occupied with Mary and their two
infant children.

Charles agreed to borrow £125,000 from Racket Bank by way of a second mortgage
over the matrimonial home. The purpose of the loan was ‘to provide emergency
funding for the construction business’. The mortgage advisor at Racket Bank was
Sally. Sally instructed Charles that the bank would require Mary ‘to sign some
documentation to show she agrees to the mortgage’.

Charles told Mary that the bank wanted her to sign ‘some stupid paperwork for a
business loan’. Mary asked why she had to sign the paperwork because ‘I have
nothing to do with the business’. Charles told Mary that if she failed to sign the
agreement then she and the children would have nowhere to live and no income.

__________________________________________________________________ 17
When Mary visited Racket Bank, Sally was on vacation. Brian was the bank employee
who talked to Mary. Brian told Mary that it was not necessary for her to take
independent legal advice, but rather that the bank would provide her with the contact
details for a solicitor if she wanted to take advice. Brian gave her the email address of
the bank’s own solicitor.

Mary signed a certificate handed to her by Brian. The certificate read: ‘(1) You are at
risk of losing your home if you agree to act as surety for another person’s loan. (2)
You have the right to receive independent legal advice at your own expense. (3) By
signing this document you certify that you understand this transaction.’

Mary will testify that she needed to be quick on the day she met Brian because one of
her children was sick and so she needed to get to the doctor’s surgery before it closed
for the day. She will testify that that was the reason for her signing the agreement
without asking further questions.

Now Charles cannot make the loan repayments. Advise Racket Bank.

Question 5

‘The line between proprietary rights and personal rights under English land law is a
narrow one. Often it is an arbitrary distinction. Nevertheless the difference it presents
is a significant one. Whether a person owns their property or merely has a personal
right connected to their property makes all the difference in the world to them.’
Discuss.

Question 6

‘English property law is too concerned to achieve fair results in individual cases. This
means that it lacks any coherence.’ Discuss.

__________________________________________________________________ 18