Williams & Glyn's Bank Ltd v Boland

JurisdictionUK Non-devolved
JudgeLord Wilberforce,Viscount Dilhorne,Lord Salmon,Lord Scarman,Lord Roskill
Judgment Date19 June 1980
Judgment citation (vLex)[1980] UKHL J0619-2
Date19 June 1980
CourtHouse of Lords
Williams & Glyn's Bank Limited
Boland and Another
Williams & Glyn's Bank Limited
Brown And Another
[Conjoined Appeals]

[1980] UKHL J0619-2

Lord Wilberforce

Viscount Dilhorne

Lord Salmon

Lord Scarman

Lord Roskill

House of Lords

Lord Wilberforce

My Lords,


These appeals, apart from one special point affecting only Mr. Boland, raise for decision the same question: whether a husband or a wife, (in each actual case a wife) who has a beneficial interest in the matrimonial home, by virtue of having contributed to its purchase price, but whose spouse is the legal and registered owner, has an "overriding interest" binding on a mortgagee who claims possession of the matrimonial home under a mortgage granted by that spouse alone. Although this statement of the issue uses the words "spouse", "husband and wife", "matrimonial home", the appeals do not, in my understanding, involve any question of matrimonial law, or of the rights of married women or of women as such. Exactly the same issue could arise if the roles of husband and wife were reversed, or if the persons interested in the house were not married to each other. The solution must be derived from a consideration in the light of current social conditions of the Land Registration Act 1925 and other property statutes.


The essential facts behind this legal formulation are as follows. Each wife contributed a substantial sum of her own money toward the purchase of the matrimonial home or to paying off a mortgage on it. This, indisputably, made her an equitable tenant in common to the extent of her contribution. Each house being registered land was transferred into the sole name of the husband who became its registered proprietor. Later, each husband mortgaged the house by legal mortgage to the appellant Bank, which made no enquiries of either wife. Default being made, the Bank started proceedings in the Boland case in the High Court, in the Brown case in the Dartford County Court, for possession, with a view to sale. In each case the judge made an order for possession but his decision was reversed by the Court of Appeal. So the question is whether the legal and registered mortgage takes effect against the matrimonial home, or whether the wives' beneficial interest has priority over it.


The legal framework within which the appeals are to be decided can be summarised as follows.


Under the Land Registration Act 1925, legal estates in land are the only interests in respect of which a proprietor can be registered. Other interests take effect in equity as "minor interests", which are overriden by a registered transfer. But the Act recognises also an intermediate, or hybrid, class of what are called "overriding interests": though these are not registered, legal dispositions take effect subject to them. The list of overriding interests is contained in section 70 and it includes such matters as easements, liabilities having their origin in tenure, land tax and title rentcharge, seignorial and manorial rights, leases for terms not exceeding 21 years; and finally, the relevant paragraph being section 70(1)(g):—

"The rights of every person in actual occupation of the land or in receipt of the rents and profits thereof, save where enquiry is made of such person and the rights are not disclosed".


The first question is whether the wife is a "person in actual occupation" and if so, whether her right as a tenant in common in equity is a right protected by this provision.


The other main legal element arises out of the Law of Property Act 1925. Since that Act, undivided shares in land can only take effect in equity, behind a trust for sale upon which the legal owner is to hold the land. Dispositions of the land, including mortgages, may be made under this trust, and provided that there are at least two trustees, or a trust corporation, "overreach" the trusts. This means that the "purchaser" takes free from them, whether or not he has notice of them, and that the trusts enforceable against the proceeds of sale. See Land Property Act 1925, section 2(2) and section 2(3) which lists certain exceptions.


The second question is whether the wife's equitable interest under the trust for sale, if she is in occupation of the land, is capable of being an overriding interest, or whether, as is generally the rule as regards equitable interests, it can only take effect as a "minor interest". In the latter event a registered transferee, including a legal mortgagee, would take free from it.


The system of land registration, as it exists in England, which long antedates the Land Registration Act 1925, is designed to simplify and to cheapen conveyancing. It is intended to replace the often complicated and voluminous title deeds of property by a single land certificate, on the strength of which land can be dealt with. In place of the lengthy and often technical investigation of title to which a purchaser was committed, all he has to do is to consult the register; from any burden not entered on the register, with one exception, he takes free. Above all, the system is designed to free the purchaser from the hazards of notice—real or constructive—which, in the case of unregistered land, involved him in enquiries, often quite elaborate, failing which he might be bound by equities. The Law of Property Act 1925 contains provisions limiting the effect of the doctrine of notice, but it still remains a potential source of danger to purchasers. By contrast, the only provisions in the Land Registration Act 1925 with regard to notice are provisions which enable a purchaser to take the estate free from equitable interests or equities whether he has notice or not. (See, for example, section 3(xv) s.v. "minor interests"). The only kind of notice recognised is by entry on the register.


The exception just mentioned consists of "overriding interests" listed in section 70. As to these, all registered land is stated to be deemed to be subject to such of them as may be subsisting in reference to the land, unless the contrary is expressed on the register. The land is so subject regardless of notice actual or constructive. In my opinion therefore, the law as to notice as it may affect purchasers of unregistered land, whether contained in decided cases, or in a statute (the Conveyancing Act 1882, section 3, Law of Property Act, section 199) has no application even by analogy to registered land. Whether a particular right is an overriding interest, and whether it affects a purchaser, is to be decided upon the terms of section 70, and other relevant provisions of the Land Registration Act 1925, and upon nothing else.


In relation to rights connected with occupation, it has been said that the purpose and effect of section 70(1)(g) of the Land Registration Act 1925 was to make applicable to registered land the same rule as previously had been held to apply to unregistered land (see per Lord Denning M.R. in National Provincial Bank Ltd. v. Hastings Car Mart Ltd. [1964] Ch. 665, 689, and in this House [1965] A.C. 1175, 1259).


I adhere to this, but I do not accept the argument which learned counsel for the appellant sought to draw from it. His submission was that, in applying section 70(1)(g), we should have regard to and limit the application of the paragraph in the light of the doctrine of notice. But this would run counter to the whole purpose of the Act. The purpose, in each system, is the same, namely, to safeguard the rights of persons in occupation, but the method used differs. In the case of unregistered land, the purchaser's obligation depends upon what he has notice of—notice actual or constructive. In the case of registered land, it is the fact of occupation that matters. If there is actual occupation, and the occupier has rights, the purchaser takes subject to them. If not, he does not. No further element is material.


I now deal with the first question. Were the wives here in "actual occupation"? These words are ordinary words of plain English, and should, in my opinion, be interpreted as such. Historically they appear to have emerged in the judgment of Lord Loughborough in Taylor v. Stibbert (1974) 2 Ves. 437, in a passage which repays quotation:—

"… whoever purchases an estate from the owner, knowing it to be in possession of tenants, is bound to inquire into the estates those tenants have. It has been determined that a purchaser being told particular parts of the estate were in possession of a tenant, without any information as to his interest and taking it for granted it was only from year to year, was bound by a lease that tenant had, which was a surprise upon him. That was rightly determined; for it was sufficient to put the purchaser upon inquiry, that he was informed the estate was not in the actual possession of the person with whom he contracted; that he could not transfer the ownership and possesion at the same time; that there were interests, as to the extent and terms of which it was his duty to inquire."


They were taken up in the judgment of the Privy Council in Barnhart v. Greenshields (1853) 9 Moo.P.C. 18. The purpose for which they were used, in that case, was evidently to distinguish the case of a person who was in some kind of legal possession, as by receipt of the rents and profits, from that of a person actually in occupation as tenant. Given occupation, i.e. presence on the land, I do not think that the word "actual" was intended to introduce any additional qualification, certainly not to suggest that possession must be "adverse": it merely emphasises that what is required is physical presence, not some entitlement in law. So even if it were necessary to look behind these plain words into history, I would find no reason for denying them their plain meaning.


Then, were the wives in actual occupation? I ask: why not...

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