General Principle:
A child in actual occupation cannot claim to have a have an overriding interest.
Name:
Hypo-Mortgage Services Ltd v Robinson [1997] 2 FLR 71
Facts:
The plaintiff in this case, Robinson, filed an appeal against a mortgage possession order that had been issued in favour of a mortgage lender against their house. Despite the fact that the husband was the only one legally entitled to own the home, his wife had allowed their children to live there. The wife's appeal was based on the fact that she possessed a beneficial interest in the property equal to one half of what was being sold and that she was holding the property in trust for the children. According to subsection (g) of section 70 of the Land Registration Act of 1925, (now Paragraph 2, Schedule 3 of the LRA 2002) every land that was registered was subject to the overriding interest of a person who was actually occupying the property, with the exception of situations in which an inquiry was made of such a person and the rights were not divulged. As a result, the equitable interest of someone who is actually occupying the property has the potential to supersede a recorded disposition of the land, such as the legal charge that is produced by a mortgage. The mortgagee's claim might be defeated, according to the appellant's reasoning, since the children had an equitable interest in the property and were really occupying it. This generated an overriding interest, the appellant said.
Ratio:
The court did not agree with the wife's line of reasoning. According to Nourse LJ, children did not have the right to employment of their own and were only allowed to participate in occupations as shadows of their parents. According to him, to hold that this is not the case would be to leave mortgage lenders defenseless, as they would constantly be thwarted when seeking to repossess the property by simple techniques such as bestowing a nominal beneficial interest in the property on a kid. He argued that this would be an example of a situation in which mortgage lenders would be left defenceless. No inquiry could be made of a minor, and particularly not very young children, according to section s.70(1)(g) of the Land Registration Act of 1925, which is now paragraph 2 of schedule 3 of the Land Registration Act of 2002. This provision could not have been meant to function in this manner.
Application:
Because of this, it is very improbable that children will have a right of independent standing to their parents. If the children is a star or celebrity and makes a considerable amount of money (for example, if the child is the world champion of a particular computer game), and if the child has made substantial payments towards the acquisition of the property, then the circumstances may be different.
תגובות