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You are here: BAILII >> Databases >> United Kingdom House of Lords Decisions >> Williams & Glyn's Bank Ltd v Boland [1980] UKHL 4 (19 June 1980)
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Cite as: [1980] 2 All ER 408, [1981] AC 487, [1980] UKHL 4

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JISCBAILII_CASE_PROPERTY

    Parliamentary Archives,
    HL/PO/JU/18/240

    Die Jovis 19° Junii 1980

    Upon Report from the Appellate Committee to
    whom was referred the Cause Williams and Glyn's
    Bank Limited against
    Boland and another, That the
    Committee had heard Counsel as well on Monday the
    21st as on Tuesday the 22nd, Wednesday the 23rd,
    Thursday the 24th and Monday the 28th days of April
    last upon the Petition and Appeal of Williams & Glyn's
    Bank Limited of 20 Birchin Lane, London E.C.3.
    praying that the matter of the Order set forth in the
    Schedule thereto, namely an Order of Her Majesty's
    Court of Appeal of the 7th day of March 1979 might
    be reviewed before Her Majesty the Queen in Her
    Court of Parliament and that the said Order might be
    reversed, varied or altered and that the Petitioners might
    have the relief prayed for in the Appeal or such other
    relief in the premises as to Her Majesty the Queen in
    Her Court of Parliament might seem meet; as also
    upon the Case of Michael Boland and Julia Boland
    lodged in answer to the said Appeal; and due
    consideration had this day of what was offered on either
    side in this Cause:

    It is Ordered and Adjudged, by the Lords Spiritual
    and Temporal in the Court of Parliament of Her
    Majesty the Queen assembled, That the said Order of
    Her Majesty's Court of Appeal (Civil Division) of the
    7th day of March 1979 complained of in the said
    Appeal be, and the same is hereby, Affirmed and that
    the said Petition and Appeal be, and the same is hereby,
    dismissed this House: And it is further Ordered,
    That the Appellants do pay or cause to be paid to the
    said Respondents the Costs incurred by them in respect
    of the said Appeal, the amount thereof to be certified
    by the Clerk of the Parliaments if not agreed between
    the parties.



    HOUSE OF LORDS

    Lord Wilberforce
    Viscount Dilhorne
    Lord Salmon
    Lord Scarman
    Lord Roskill

    WILLIAMS & GLYN'S BANK LIMITED
    (APPELLANTS)

    v.

    BOLAND AND ANOTHER
    (RESPONDENTS)

    WILLIAMS & GLYN'S BANK LIMITED
    (APPELLANTS)

    v.

    BROWN AND ANOTHER
    (RESPONDENTS)

    [CONJOINED APPEALS]

    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 under-
    standing, 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):-

    2

    "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 regis-
    ter; 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, in-
    volved 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 Regis-
    tration 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(l)(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] AC 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

    3

    section 70(l)(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 occu-
    pation"? 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 Yes. 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 possession 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? There was
    physical presence, with all the rights that occupiers have, including the right to
    exclude all others except those having similar rights. The house was a matri-
    monial home, intended to be occupied, and in fact occupied by both spouses,
    both of which have an interest in it: it would require some special doctrine of
    law to avoid the result that each is in occupation. Three arguments were used
    for a contrary conclusion. First, it was said that if the vendor (I use this word to
    include a mortgagee) is in occupation, that is enough to prevent the application
    of the paragraph. This seems to be a proposition of general application, not
    limited to the case of husbands, and no doubt, if correct, would be very con-
    venient for purchasers and intending mortgagees. But the presence of the vendor,
    with occupation, does not exclude the possibility of occupation of others. These
    are observations which suggest the contrary in the unregistered land case of
    Caunce v. Caunce [1969] 1 W.L.R. 286, but I agree with the disapproval of
    these, and with the assertion of the proposition I have just stated by Russell L.J.
    in Hodgson v. Marks
    [1971] Ch 892, 934. Then it was suggested that the wife's
    "occupation" was nothing but the shadow of the husband's—a version I suppose
    of the doctrine of unity of husband and wife. This expression and the argument
    flowing from it was used by Templeman J. in Bird v. Syme-Thomson [1979]
    1 W.L.R. 440-444, a decision preceding and which he followed in the present
    case. The argument was also inherent in the judgment in Caunce v. Caunce
    (supra)
    which influenced the decisions of Templeman J. It somewhat faded
    from the arguments in the present case and appears to me to be heavily obsolete.
    The appellants main and final position became in the end this: that, to come
    within the paragraph, the occupation in question must be apparently incon-
    sistent with the title of the vendor. This, it was suggested, would exclude the

    4

    wife of a husband-vendor because her apparent occupation would be satisfac-
    torily accounted for by his. But, apart from the rewriting of the paragraph which
    this would involve, the suggestion is unacceptable. Consistency, or incon-
    sistency, involves the absence, or presence, of an independent right to occupy,
    though I must observe that "inconsistency" in this context is an inappropriate
    word. But how can either quality be predicated of a wife, simply qua wife? A
    wife may, and everyone knows this, have rights of her own; particularly, many
    wives have a share in a matrimonial home. How can it be said that the presence
    of a wife in the house, as occupier, is consistent or inconsistent with the husband's
    rights until one knows what rights she has? And if she has rights, why, just
    because she is a wife (or in the converse case, just because an occupier is the
    husband), should these rights be denied protection under the paragraph? If
    one looks beyond the case of husband and wife, the difficulty of all these
    arguments stands out if one considers the case of a man living with a mistress,
    or of a man and a woman—or for that matter two persons of the same sex—
    living in a house in separate or partially shared rooms. Are these cases of
    apparently consistent occupation, so that the rights of the other person (other
    than the vendor) can be disregarded? The only solution which is consistent with
    the Act (section 70(l)(g)) and with common sense is to read the paragraph for
    what it says. Occupation, existing as a fact, may protect rights if the person in
    occupation has rights. On this part of the case I have no difficulty in concluding
    that a spouse, living in a house, has an actual occupation capable of con-
    ferring protection, as an overriding interest, upon rights of that spouse.

    This brings me to the second question, which is whether such rights as a
    spouse has under a trust for sale are capable of recognition as overriding
    interests—a question to my mind of some difficulty. The argument against this
    is based upon the structure of the Land Registration Act 1925 and upon specific
    provisions in it.

    As to structure, it is said that the Act recognises three things: (a) legal estates,
    (b) minor interests, which take effect in equity, (c) overriding interests. These are
    mutually exclusive: an equitable interest, which is a minor interest, is incapable
    of being at the same time an overriding interest. The wife's interest, existing
    under, or behind, a trust for sale is an equitable interest and nothing more. To
    give it the protection of an overriding interest would, moreover, contradict the
    principle according to which such an equitable interest can be overreached by
    an exercise of the trust for sale. As to the provisions of the Act, particular
    emphasis is placed on section 3(xv) which, in defining "minor interests"
    specifically includes in the case of land held on trust for sale "all interests and
    "powers which are under the Law of Property Act, 1925, capable of being
    "overriden by the trustees for sale" and excludes, expressly, overriding interests.
    Reliance is also placed on section 86, which, dealing analogously, so it is said,
    with settled law, prescribes that successive or other interests created by or
    arising under a settlement take effect as minor interests and not otherwise, and
    on section 101 which, it is argued, recognises the exclusive character of minor
    interests, which in all cases can be overridden.

    My Lords, I find this argument formidable. To reach a conclusion upon it
    involves some further consideration of the nature of trusts for sale, in relation
    to undivided shares. The trusts upon which, in this case, the land is to be held
    are defined—as "statutory trusts"—in section 35 of the Law of Property
    Act, 1925, i.e.

    ' . . . upon trust to sell the same and to stand possessed of the net
    "proceeds of sale, after payment of costs, and of the net rents and profits
    "until sale after payment of rates, taxes, costs of insurance, repairs, and
    "other outgoings, upon such trusts, and subject to such powers and
    "provisions, as may be requisite for giving effect to the rights of the
    "persons . . . interested in the land".

    In addition to this specific disposition, the general provisions as to trusts for
    sale in sections 23-31, where not inconsistent, appear to apply. The right of
    occupation of the land pending sale is not explicity dealt with in these sections

    5

    and the position as to it is obscure. Before the Act the position was that owners
    of undivided shares (which could exist at law) had concurrent rights of occup-
    ation. In Bull v. Bull [1955] 1 Q.B. 234, it was held by the Court of Appeal,
    applying In re Warren [1932] 1 Ch. 42, that the conversion of these legal estates
    into equitable interests by the Law of Property Act 1925 should not affect the
    mutual rights of the owners. Denning L.J., in a judgment which I find most
    illuminating, there held, in a factual situation similar to that of the instant
    cases, that "when there are two equitable tenants in common, then, until the
    "place is sold, each of them is entitled concurrently with the other to the
    "possession of the land and to the use and enjoyment of it in a proper manner"
    (I.c. p.238). And he referred to section 14 of the Law of Property Act 1925
    which provides that the Act "shall not prejudicially affect the interest of any
    "person in possession or in actual occupation of land to which he may be
    "entitled in right of such possession or occupation".

    How then are these various rights to be fitted into the scheme of the Land
    Registration Act 1925? It is clear, at least, that the interests of the co-owners
    under the "statutory trusts" are minor interests—this fits with the definition
    in section 3(xv). But I can see no reason why, if these interests, or that of any
    one of them, are or is protected by "actual occupation" they should remain
    merely as "minor interests". On the contrary, I see every reason why, in that
    event, they should acquire the status of overriding interests. And, moreover,
    I find it easy to accept that they satisfy the opening, and governing, words of
    section 70, namely, interests subsisting in reference to the land. As Lord
    Denning M.R. points out, to describe the interests of spouses in a house jointly
    bought to be lived in as a matrimonial home as merely an interest in proceeds
    of sale, or rents and profits until sale, is just a little unreal see also Elias v.
    Mitchell [1972] Ch. 652 per Pennycuick V.-C. with whose analysis I agree,
    and contrast, Cedar Holdings v. Green [1979] 3W.L.R.31 (which I consider to
    have been wrongly decided).

    There are decisions, in relation to other equitable interests than those of
    tenants in common, which confirm this line of argument. In Bridges v. Mees
    [1957] Ch. 475, Harman J. decided that a purchaser of land under a contract
    for sale, who had paid the price and so was entitled to the land in equity, could
    acquire an overriding interest by virtue of actual occupation, and a similar
    position was held by the Court of Appeal to arise in relation to a resulting trust
    (Hodgson v. Marks
    [1971] Ch 892). These decisions (following the law as it
    undoubtedly existed before 1925—see Barnhart v. Greenshields I.c. p.32,
    Daniels v. Davison (1809) 16 Yes. 249, Allen v. Anthony (1816) 1 Mer. 282, 284
    per Lord Eldon) provide an answer to the argument that there is a firm dividing
    line, or an unbridgeable gulf, between minor interests and overriding interests,
    and, on the contrary, confirm that the fact of occupation enables protection of
    the latter to extend to what without it would be the former. In my opinion,
    the wives' equitable interests, subsisting in reference to the land, were by the
    fact of occupation, made into overriding interests, and so protected by section
    70(l)(g). I should add that it makes no difference to this that these same interests
    might also have been capable of protection by the registration of a caution
    (see Bridges v. Mees p.c. p.487, Land Registration Act 1925, section 59(6)).

    There was finally an argument based upon section 74 of the Land Registration
    Act 1925.

    "74. Subject to the provisions of this Act as to settled land, neither
    "the registrar nor any person dealing with a registered estate or charge
    "shall be affected with notice of a trust express implied or constructive,
    "and references to trusts shall, so far as possible, be excluded from the
    "register".

    The argument was that if the overriding interest sought to be protected is,
    under the general law, only binding on a purchaser by virtue of notice, the
    section has the effect of denying the protection. It is obvious—and indeed
    conceded—that if this is right, Hodgson v. Marks and Bridges v. Mees (supra)
    must have been wrongly decided.

    6

    I am of opinion that this section has no such effect. Its purpose is to make
    clear, as I have already explained, that the doctrine of notice has no application
    to registered conveyancing, and accordingly to establish, as an administrative
    measure, that entries may not be made in the register which would only be
    appropriate if that doctrine were applicable. It cannot have the effect of cutting
    down the general application of section 70(1)(9).

    I would only add, in conclusion, on the appeal as it concerns the wives a
    brief observation on the conveyancing consequences of dismissing the appeal.
    These were alarming to Templeman J., and I can agree with him to the extent
    that whereas the object of a land registration system is to reduce the risks to
    purchasers from anything not on the register, to extend (if it be an extension)
    the area of risk so as to include possible interests of spouses, and indeed, in
    theory, of other members of the family or even outside it, may add to the
    burdens of purchasers, and involve them in enquiries which in some cases may
    be troublesome.

    But conceded, as it must be, that the Act, following established practice,
    gives protection to occupation, the extension of the risk area follows necessarily
    from the extension, beyond the paterfamilias, of rights of ownership, itself
    following from the diffusion of property and earning capacity. What is involved
    is a departure from an easy-going practice of dispensing with enquiries as to
    occupation beyond that of the vendor and accepting the risks of doing so.
    To substitute for this a practice of more careful enquiry as to the fact of
    occupation, and if necessary, as to the rights of occupiers can not, in my view
    of the matter, be considered as unacceptable except at the price of overlooking
    the widespread development of shared interests of ownership. In the light of
    section 70 of the Act, I cannot believe that Parliament intended this, though it
    may be true that in 1925 it did not foresee the full extent of this development.

    Mr. Boland's appeal

    The special point taken by Mr. Boland arises out of the facts of his case and
    the nature of the Bank's proceeding against him. This was brought under
    R.S.C. Order 88 for summary judgment. Mr. Boland contended that there was
    a dispute as to the amount actually owed by him to the Bank, and that until
    this dispute was resolved by trial, judgment for possession ought not to be
    granted against him before he had had an opportunity of invoking the discretion
    of the Court under the Administration of Justice Act 1970 section 36. The
    judgment of Templeman J., who fully considered this point, provides a complete
    answer to this contention. It is clear that, on the view of the matter most
    favourable to Mr. Boland, he owes a substantial sum, of the order of £40,000,
    to the Bank. He has, on the other hand, put forward no material evidence as
    to the likelihood, or possibility, of discharging or refinancing this indebtedness,
    upon which to invoke the court's discretion under the section, and the judge
    was undoubtedly right in refusing to exercise it in the absence of such material
    evidence. In any case, there was no basis upon which the Court of Appeal could
    legitimately interfere with the decision of the judge, and indeed no substantial
    reason was given for doing so. In my opinion this part of the decision of the
    Court of Appeal cannot be supported.

    However, on the main issue on both appeals, as they affect the wives, the
    decision of the Court of Appeal was, in my opinion, right, and an order for
    possession cannot be made in either case. I would dismiss the appeals.

    Viscount Dilhorne

    My lords,

    I had intended to deliver a speech in this important case but since I have had
    the advantage of reading in draft the speech of my noble and learned friend,
    Lord Wilberforce, I have come to the conclusion that no useful purpose would
    be served by my doing so as I agree with him so completely, both in his reasoning
    and in his conclusions.

    I too would dismiss the appeals.

    7

    Lord Salmon

    my lords,

    I have had the advantage of reading in draft the speech prepared by my noble
    and learned friend, Lord Wilberforce. For the reasons he gives, I too, would
    dismiss the appeal.

    Lord Scarman

    MY LORDS,

    The result of the appeals in the two wives' cases will depend upon the
    construction to be put upon section 70(l)(g) of the Land Registration Act 1925.
    But the importance of the House's decision is not to be judged solely by its
    impact on conveyancing, or banking, practice. The Court of Appeal recognised
    the relevance, and stressed the importance, of the social implications of the
    case. While the technical task faced by the courts, and now facing the House,
    is the construction to be put upon a sub-clause in a subsection of a conveyancing
    statute, it is our duty, when tackling it, to give the provision, if we properly
    can, a meaning which will work for, rather than against, rights conferred by
    Parliament, or recognised by judicial decision, as being necessary for the
    achievement of social justice. The courts may not, therefore, put aside, as
    irrevelant, the undoubted fact that, if the two wives succeed, the protection of
    the beneficial interest which English law now recognises that a married woman
    has in the matrimonial home will be strengthened, whereas, if they lose, this
    interest can be weakened, and even destroyed, by an unscrupulous husband. Nor
    must the courts flinch when assailed by arguments to the effect that the pro-
    tection of her interest will create difficulties in banking or conveyancing practice.
    The difficulties are, I believe, exaggerated: but bankers, and solicitors, exist to
    provide the service which the public needs. They can—as they have successfully
    done in the past—adjust their practice, if it be socially required. Nevertheless,
    the judicial responsibility remains—to interpret the statute truly according to
    its tenor. The social background is, therefore, to be kept in mind but can be
    decisive only if the particular statutory provision under review is reasonably
    capable of the meaning conducive to the social purpose to which I have referred.
    If it is not, the remedy is to be found not by judicial distortion of the language
    used by Parliament but in amending legislation.

    Fortunately, these appeals call for no judicial ingenuity—let alone distortion.
    The ordinary meaning of the words used by Parliament meets the needs of
    social justice.

    Each appeal is concerned with registered land; and each raises the same
    point—the true construction of section 70(l)(g) of the Land Registration Act
    1925. The relevant terms of the subsection are:—

    "70—(1) All registered land shall, unless under the provisions of this
    "Act the contrary is expressed on the register, be deemed to be subject
    "to such of the following overriding interests as may be for the time being
    "subsisting in reference thereto, and such interests shall not be treated as
    "incumbrances within the meaning of this Act, (that is to say):—

    " . . .

    "(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;"

    It is conceded that each wife has a beneficial interest in the land, which is
    her matrimonial home. Each is an equitable tenant in common behind a trust
    for sale, there being only one trustee, her husband, in whom the legal estate
    (a freehold) is vested. Each, therefore, enjoys by reasons of her interest, a

    8

    present right of occupation as well as a right to a share in the proceeds of sale,
    if and when the house is sold: Bull v. Bull [1955] 1 Q.B. 234. It is also conceded'
    that each was at all material times living in her house with her husband: and,
    for the reasons given by my noble and learned friend, Lord Wilberforce,
    I have no doubt that the wife was, as also was her husband, in actual occupation
    of the home.

    Upon these facts, a construction of the subsection based upon the ordinary
    meaning of the words of the subsection can lead to only one conclusion:
    the wife has an overriding interest. For each wife meets the three requirements
    of the section. She was in "actual occupation", in the ordinary meaning of the
    words, and she enjoyed "rights", one of which, her right to occupation, was
    certainly an interest "subsisting in reference" to registered land. Since the Bank
    made no enquiry of the wife in either case before granting the husband a
    mortgage, its claim as mortgagee to possession is, on this view of the subsection,
    defeated by the wife's overriding interest.

    But the Bank submits that this simple approach to the interpretation of the
    subsection must be rejected as inconsistent with other key provisions in the
    Land Registration Act 1925 and with its legislative purpose. It is submitted that
    the true meaning of the subsection is to be gathered from an examination of
    the statute against its historical background and in the context of the property
    law, which includes the provisions of the 1925 legislation dealing with the
    trust for sale.

    An English lawyer ignores history at his peril. But the lessons of our legal
    history are not always easy to discern. Legal history, even English legal history,
    is not one of unbroken continuity in the law's development: it includes some-
    times the rejection of existing principles and the introduction of new ones.
    The Land Registration legislation is an example. The wearisome and intricate
    task of examining title, and with it the doctrine of notice have been replaced
    by a statutory system of registration (where the Act applies), subject to the
    overriding interests set out in section 70(1). These interests take effect under the
    section without registration and whether or not a purchaser has notice of them.
    I do not, therefore, read the Act of 1925 as requiring the courts to give the
    words "actual occupation" in section 70(l)(g) the special meaning for which
    the appellants contend, namely an occupation, which by its nature necessarily
    puts a would-be purchaser (or mortgagee) upon notice of a claim adverse to
    the registered owner. On the contrary, 1 expect to find—as I do find—that the
    statute has substituted a plain factual situation for the uncertainties of notice,
    actual or constructive, as the determinant of an overriding interest. Nor—and
    for the same reason—do I accept the submission that assistance in interpreting
    these words is to be gained from considering such cases as Caunce v. Caunce
    [1969] 1 W.L.R. 286, which dealt with unregistered land. The issue in those
    cases was as to the circumstances in which occupation constitutes constructive
    notice to a purchaser of the rights of the occupier. Like Russell L.J. in Hodgson
    v. Marks
    [1971] Ch 892 (pp.934-935), I am by no means certain that Caunce
    v. Caunce was correctly decided. However, since the present case is concerned
    only with registered land, it is unnecessary to express a final opinion upon the
    point.

    My noble and learned friend, Lord Wilberforce, has dealt with the appellants'
    arguments based on the Act's definitions of minor interests and overriding
    interests. I agree with him in rejecting them, and will, therefore, add only a few
    words of my own. The critically important right of the wife, so far as these
    appeals are concerned, is the right of occupation of the land. This right, if
    unaccompanied by actual occupation, is clearly within the definition of a minor
    interest: section 3(xv). It is not, therefore, itself an overriding interest. But, once
    it is associated with actual occupation, the association is an overriding interest.
    I agree with the appellants that overriding interests and minor interests are, as
    categories, exclusive of each other. But there is no logical difficulty in the
    association of a minor interest with another factor (i.e. actual occupation) being,
    qua association, an overriding interest. And this is, in my judgment, the effect
    of section 70(1)(g).

    9

    For these reasons I would dismiss the appeals of the Bank in the wives' cases.
    I agree with my noble and learned friend that Mr.
    Boland's appeal must, how-
    ever, be dismissed. But his lack of success makes no difference to the outcome
    of the litigation. The Bank fails in each case to obtain what it seeks, an order
    for possession of the matrimonial home, because the wife is in actual occupation
    and has herself a right of occupation.

    Lord Roskill

    my lords,

    I have had the advantage of reading in draft the speech of my noble and
    learned friend Lord Wilberforce. I agree with it, and would dismiss this appeal
    for the reasons therein set out.

    Since your Lordships have reached the same result as the Court of Appeal, it is
    in my judgment desirable to correct one statement in the judgment of Lord
    Justice Ormrod in that court which learned counsel for the respondents found
    himself unable to support, lest otherwise that statement by the learned Lord
    Justice may be thought to have the approval of your Lordships' House. That
    statement appears in the report of Lord Justice Ormrod's judgment in [1979]
    Ch. 309 at p.337. He was dealing with the appellants' submissions based on
    section 3(xv) (a) of the Land Registration Act 1925 and on section 2 of the Law
    Property Act 1925. He said:—

    "I think, with respect, that the answer to both points is that the wives'
    "interests have not been overreached and are not capable of being over-
    "reached because in each case the land was held by a sole trustee who has no
    "overreaching powers . . . ".

    Your Lordships were told by learned counsel that this point had not been
    discussed in argument before the Court of Appeal, but was raised for the first
    time in this judgment. Accordingly counsel did not have the opportunity of
    drawing the attention of the learned Lord Justice to section 49(2) of the Land
    Registration Act 1925 and to the protection that that section accords. No doubt
    had they done so, the learned Lord Justice would not have expressed himself
    as he did.

    B721776/MP Dd 8013619 216 6/80


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