Background:
The effect of registration on appurtenant rights.
The Land Registration Act 1925 (the "LRA 1925") applied to transfers of registered land before 13th October, 2003. Section 20 of the LRA 1925 provided that a disposition of freehold land registered with absolute title for valuable consideration, when registered, conferred on the transferee an estate in fee simple "together with all rights, privileges and appurtenances belonging or appurtenant thereto including…the appropriate rights and interests which would under the Law of Property Act 1925 have been transferred if the land had not been registered".
The extinguishment of easements
An easement may be extinguished in one of three ways:
1. By an express release from the owner of the dominant land (i.e. the land with the benefit of the easement) at any time. To take effect at law, the release must be effected by deed. However, equity will recognise an informal release if it would be inequitable to allow the owner of the dominant land to rely on a failure to effect the release by deed (see for example, Waterlow v Bacon [1866] LR 2 Eq 514). It will generally be inequitable for the owner of the dominant land to raise this argument if the owner of the servient tenement has altered his position in the belief that the easement has been effectively extinguished.
2. By an implied release, which will occur if the dominant owner has abandoned his right. To establish abandonment, the conduct of the dominant owner must have been such as to make it clear that he had a fixed intention never at any time thereafter to assert the right himself or to attempt to transmit it to anyone else. This will be a question of fact.
3. If the dominant and servient tenements come into the same hands. It is important that both ownership and possession become common. If the freeholder of the dominant tenement takes a lease of the servient tenement, this does not extinguish the easement.
The principle of mutual benefit and burden
It is a principle of law that a man cannot take the benefit under a deed without subscribing to the obligations under it (Halsall and others v Brizell and another [1957] 1 All ER 371).
These issues arose in the case of Allen v Jones [2004] EWCH 1119.
Facts:
The claimants and the defendants were owners of adjoining freehold properties in Essex. The titles to both properties were registered. The defendants’ house had been constructed by a predecessor in title, Mr Turner. The defendant’s land originally had the benefit of a right of way to a nearby road, part of which was concrete and part of which was mud and grass. This right of way was registered on the title to the defendants’ land.
During construction of the bungalow, the claimants permitted Mr Turner to put down a hardcore base on the access road. Mr Turner then sought to obtain permission to retain permanently a hard surface on the access, in return for surrendering some of his access rights.
This was agreed by the claimants and recorded in writing. The agreement was not drafted by solicitors and was not executed as a deed. No entries on the registers of title for the two properties were made in respect of the agreement.
The defendants subsequently purchased the bungalow. They were not aware of the agreement reducing the extent of the right of way benefiting the property until after completion. The defendants complained to Mr Turner’s solicitors and the claimants but, when no satisfactory response was received, proceedings were commenced.
The claimants argued:
The agreement between them and Mr Turner was effective either at law or in equity to extinguish the right of way over part of the access and was binding on the defendants. It showed a clear intention by Mr Turner and his successors to abandon the easement and therefore the easement was extinguished by implication.
The agreement complied with section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 and consideration was provided, therefore the agreement should take effect in equity against those who had notice of it, which included Mr Turner and, it was contended, the defendants.
Even if the defendants did not have notice of the agreement, they were bound under the principles of "mutual benefit and burden" because they were enjoying the benefit of the upgraded surface over the access.
The defendants were barred by the principles of proprietary estoppel from being able to enforce the right of way, either by their own actions or by those of Mr Turner.
The defendants argued that pursuant to section 20 of the LRA 1925, the transfer of the property to the defendants operated to transfer to them all of the rights shown on the register of title, including the benefit of the right of way as shown on the filed plan. None of the arguments advanced by the claimants was sufficient to displace the consequences of registration.
Decision:
Judgment was given in favour of the defendants. The judge took as a starting point the speech of Lord Wilberforce in Williams & Glyn’s Bank Ltd v Boland [1981] AC 487 at 503F-504C (cited by Mummery LJ in Bhullar & Bhullar v McArdle [2001] EWCA Civ 510), in which Lord Wilberforce said that the system of land registration was designed to free a purchaser from the hazards of notice which, in unregistered land, involved him in enquiries, failing which he might be bound by equities. With the exception of overriding interests, the only kind of notice recognised in the land registration system was an entry on the register.
The effect of section 20 of the LRA 1925 was that the benefit of the original right of way was transferred to the defendants. The question was whether any of the claimants’ arguments was sufficient to displace the effect of section 20.
In relation to the claimants’ argument that the easement over part of the access was extinguished by the written agreement, the judge said that there had been no express release because the agreement was not under seal and did not therefore comply with the formalities required for the express release of an easement. The judge also rejected the argument that there had been an implied release because the agreement showed an intention to abandon the easement over part of the access. It would be extraordinary if the court could infer an implied release from an express agreement and, in the case of easements established by a presumed grant, an implied release can only be rarely inferred.
In relation to the argument that the agreement was effective in equity, the judge accepted that the agreement was effective as against Mr Turner. But the judge found as a fact that the defendants did not have notice of the agreement and so the agreement could not bind them in equity.
In relation to the "mutual benefit and burden" argument, the judge referred to the Bhullar case where a similar submission was made; any estoppel preventing the taking of the benefit of the agreement without accepting the burdens imposed by it could not apply as against the defendants simply by reason of what was done by Mr Turner before the defendants acquired the property because the estoppel was not entered on the register and it was not an overriding interest.
The principle could only apply if the defendants’ conduct after acquiring their house justified an estoppel being applied to them. All the defendants had done was to drive over the access to their property and the defendants made it clear that they did not wish to retain the benefit of retaining the gravel surface on the access. In those circumstances, the mutual benefit and burden principle did not estop the defendants from claiming the right of way in accordance with their registered title.
Finally, in relation to the proprietary estoppel argument, since the claimants had relied on representations made by Mr Turner in the agreement and acted on those representations to their detriment, an estoppel may well have operated against him. However, the defendants made no such representation. Since any equity that may have bound Mr Turner had not been registered, the defendants took free of it.
Comment:
The effect of registration on appurtenant rights
The LRA 1925 set out in detail the effect of registration of a proprietor of a registered estate. By contrast, there are no express provisions in the Land Registration Act 2002 (the "LRA 2002") regarding appurtenant rights. However, Ruoff and Roper confirms that the disposition of a registered estate will take effect with the benefit of the rights that are appurtenant to that estate. These include:
easements expressly mentioned on the register as being appurtenant;
appurtenant legal easements that are granted as part of the disposition (subject to completion of the registration requirements in the LRA 2002 in respect of those easements); and
appurtenant rights that will pass by way of implied grant or as prescriptive rights under the general law e.g. under section 62 of the Law of Property Act 1925, under the rule in Wheeldon v Burrows [1879] 12 Ch D 31, or as an easement of necessity or under the Prescription Act 1832.
(Ruoff and Roper on the law and practice of registered conveyancing, 2003 edition, paragraphs 3.008.01 and 3.008.02).
The extinguishment of easements
In this case, there had been no express release of part of the right of way because the formalities for such a release had not been complied with. What is the position if there is an express release of an easement that is registered as an appurtenant right to a parcel of land but the release is not registered? Will a purchaser of the land still have the benefit of the easement? The position is unclear but it is arguable that the registration of the benefit of an easement is not conclusive and that if the easement has been extinguished, e.g. by an express release, that would bind the purchaser.
The advice in practice is therefore to ensure that any modification or release of an easement is properly documented by deed so as to be effective at law and, if the benefit of the easement has been registered, that an application is made to update the entries on the register.
The principle of mutual benefit and burden
If the principle of "mutual benefit and burden" applies to prevent a party from taking the benefit of an agreement without accepting the burdens imposed by it, an equity by estoppel will arise in favour of the person seeking to enforce the agreement against that party. That equity is a right to go to court to seek relief. Until the court gives effect to the equity, it is a proprietary right (in relation to registered land, this has been put on a statutory footing by section 116(a) of the LRA 2002). In registered land, the person with the benefit of the equity must protect it if it is to bind successors in title of the burdened land by entering a notice in the register or, if the person is in actual occupation of the relevant land, it will be protected as an unregistered interest that will override a registered disposition.
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