Cases

Williams and Glyn’s Bank v Boland [1980]

● Boland was the sole proprietor of the matrimonial home but wife made substantial contributions
(beneficial interest - trust of sale)
● Boland mortgaged the house and defaulted on payments → bank applied for possession
● Wife claimed an overriding interest based on beneficial interest and actual occupation
● Bank applied for possession → Mr. Boland failed to repay the bank after borrowing money
● Consideration: husband was the sole legal proprietor, did not meet the conditions for overreaching
● Rejected bank’s application for possession
● Now → Class F as a result of Family Law Act 1996
● Was previously not registrable
● Had not been overreached → did not meet requirements
● Doctrine of notice applies

City of London Building Society v Flegg

● Daughter/husband were legal owners and the parents contributed to the purchase (beneficial interest -
trust of sale) and lived with them
○ Trust between daughter and husband
○ Trust between daughter/husband and the parents
● No restrictions were placed in the register pursuant to their beneficial interest
● Parents didn’t know but the couple took out multiple mortgages against the house and couldn’t repay
● City of London Building Society sought repossession
● Rights of the parent in laws overreached
○ Even with “actual occupation,” money was paid to two trustees when they contributed towards
the house, interest attached to the money not the property
● Dicta CoA:
○ Recognition that there is a distinction to be made from Boland where there was only a sole
trustee, and therefore the criteria for overreaching could not be found (pg 59)
● House of Lords - Lord Templeton:
○ The court found that the ability to stay in occupation of the property was overreached by way of
legal charge, and the rights are transferred to the equity of redemption (pg 73)
● House of Lords - Lord Aylmerton:
○ The fact that there are two trustees means that overreaching can apply – pg 74
○ Courts recognised that there was a wide assumption that the purchaser should not have to
worry themselves with those in actual occupation as long as they are purchasing/granting a
charge to two or more trustees, in which case they will be able to overreach any overriding
interests (pg 76)
○ Clear from the Trustee Act 1925 that a purchaser or mortgagee, so long as he pays the
proceeds of sale or other capital moneys to not less than two trustees or to a trust corporation,
to accept a conveyance or mortgage without reference at all to the beneficial interests of
co-owners (pg 79)
WHY is there a distinction between 1 and 2 trustees?
● System of land registration is supposed to make transacting land easier
● By putting trust behind a curtain
● Trustees have a responsibility to their beneficiaries → can sue if this is breached

● If a trust corporation or two trustees sell property, probable that they wouldn’t be breaching (because
they both have to be in agreement) and if they were, you could sue → THIS IS THE CASE IN FLEGG
● 1 trustee can do anything they want → you have to be protected from your rights being overreached
● LPA S27

The cases of Williams & Glyn’s Bank v Boland and City of London Building Society v
Flegg both describe similar facts: each involves a mortgage lender (‘mortgagee’)
attempting to take possession of a property over which they have a mortgage charge,
against the wishes of occupants who were not liable for the mortgage debt. Write a
summary of each case, and explain why they were decided differently. Is the
difference in outcome justifiable?
Williams & Glyn’s Bank v Boland:
Mr Boland was the sole registered proprietor of the matrimonial home.
Mrs Boland had made substantial contributions to the purchase price and
mortgage payments entitling her to a beneficial interest in the house.
Mr Boland mortgaged the house and defaulted on payments. Therefore, the
Bank sought possession of the property and Mrs Boland claimed an overriding
interest under s.70(1)(g) Land Registration Act 1925 based on her beneficial
interest.
The bank argued that the wife’s occupation was not inconsistent with the title
offered and that an interest could not be both a minor interest and overriding
interest.
It was held that the wife’s beneficial interest was overriding by virtue of her
actual possession. Therefore, the bank’s attempt for possession was
unsuccessful.
City of London Building Society v Flegg:
Mr & Mrs Maxwell Brown purchased Bleak House in 1977 for £34,000. Half
the purchase price was funded by the parents of Mrs Maxwell Brown, Mr &
Mrs Flegg.