Property Law Reform I
Settlements
Settlements were a dominant feature of 19th century property holding by persons of substantial means and in particular, landed aristocratic families. Significant land holdings were commonly settled on trust for the current holder for life for and on his death for his children. The objective was not to divide land but to keep it intact in a line of descendants generally male. There was an inbuilt incentive to resettle the property each generation, and also to incumber it.
A strict settlement was commonly established to secure descent down the line of eldest males/ Under a strict settlement, the settlor (creator) was generally the person who would inherit the fee simple in remainder after the death of the current life tenant conveyed it to himself for life and after death, a rent charge or a jointure for his widow.
Subject to these life interests he granted lease for a long term such as 500 years to trustees to raise by mortgage of that term a sum of money for portions for his younger children. Subject to this, the property was transferred on trust for his eldest son successively and the heirs males of their bodies with ultimate remainder in default of an issue to the settler himself in fee simple.
Upon his death, the eldest son as tenant in tail could by common recovery and later statute convert his estate entailed into a fee simple subject to the portions in favour of younger siblings which might be discharged by various mechanisms. The perpetuities rules for forbade the typing up of the property beyond lives in being at the date of the settlement or will plus 21 years.
In practices, the eldest son when he came of age prior to his fee tail interest falling into possession was induced to resettle on the same terms, down another generation. He surrendered his future fee tail in return for for some present allowance or funds. While his father remained alive, he could not convert the fee tail into other than a base fee which was unlikely to be sufficient to secure mortgage funds.
Accordingly, there was an inbuilt mechanism to incentivise him to resettle for a present allowance in the same way has his father had done. He and his father disentailed the property and resettling it, restoring his father’s life estate, giving the life estate to the son and estate entail to the son’s sons successively. Thus, the process was repeated, and land was tied up in the landed family for successive generations.
Attempts to Unfetter Land
The effect of the settlement was to make the estate largely unsaleable and unmortgageable. The tenant for life could not sell, partition or exchange the property. The portion charged for siblings could be more than the estate could bear. There was little incentive for undertaking improvements as they accrued for the life tenant and his successors.
The life tenant could not demolish the mansion house or make any substantial improvement. Unless he was unimpeachable for waste, he could not open new mines. He did not have capacity to make a long lease. When an adjoining town grew and made it suitable for building sites, he could not lawfully grant a sufficient interest to induce the development of the land.
In some cases, settlements contained express powers to allow trustees to grant leases, sell, exchange and partition. However, frequently such powers were not present. Only a private act of parliament could authorise the trustees to undertake sales, long leases, etc. in these cases. This is beyond the means of all but the most affluent of landowners.
Barring the fee tail involved an artificial construct by way of a pretended action by a collusive plaintiff against the tenant in tail for the recovery of the land. The collusive plaintiff claimed falsely that he had purchased land from a man of straw, generally a court crier who had warranted title and ask that the person should be vouched to warranty to defend his action. The crier being called, admitted the warranty and a default judgment was given to the plaintiff that the crier should convey lands of equal value to the tenant in tail under a fictitious warranty.
Statutory Relief
The procedure involved unnecessary and undue expense and was entirely fictional. Following a report of the Real Property Commissioners in 1829, the Fines and Recovery Act 1833 abolished the method of barring entailed by common recovery. It substituted a statutory procedure involving enrolment of deed of conveyance. The consent of the current life tenant was required for a full effective barring. Otherwise a base fee was created.
The Drainage Acts both in England and Ireland empowered limited owners to undertake permanent improvements by way of drainage. The expenses might be charged on the land so as to bind successors. See generally the separate chapter on the 19th century Drainage acts.
The Improvement of Land Act 1864 gave tenants for life wider powers by enabling them with the sanction of the Enclosure Commissioners in England to raise money by rentcharge for various improvements including drainage, improvement of water courses, fencing, reclamation, making of roads, tramways canals, improvement of land, erection of colleges and buildings, construction of piers and many other matters. The legislation was supplemented by the Limited Owners Residence Acts 1870 and 1871 and the Limited Owners (Reservoir and Water Supply) Act 1877 which allowed additions to the mansion house and construction of permanent water works respectively.
A Settled Estate Act 1856 was amended and later re-enacted as the Settled Estate Act 1877. It allowed the Court of Chancery to allow the sale, exchange, partition of settled land and granting of leases not exceeding 21 years, for agricultural purpose, 40 years for mining, 60 for repairing lease and 99 for a building lease, unless the court was satisfied, that it was usual in the district for the benefit of property that longer leases should be granted. The tenant for life is authorised without the consent of court to provide leases less than 21 years unless the settlement removed the power.
Settled Acts
The Settled Land Act 1882 ultimately provided a comprehensive solution to the limited powers of the life owner. See the separate chapter in relation to the Settled Land Act legislation which remained in force until 2009, when it was replaced by the similar modern trust of land concept.
The Settled Land Act, in broad terms, allowed the life owner to exercise many powers with the consent in many cases of certain nominated parties or the trustees of the settlement. There were measures to protect future owners including in the case of sale, that their rights would attach to the proceeds of sale, such that the current interest (money interest) belonged to the life tenant and capital belonged to the future owners.
The life tenant was given power to deal with land, and in particular to sell, exchange or lease it. The tenant for life was given the most important powers of dealing. These are made inalienable and could not be varied. A notice of intention to exercise key statutory powers must be given to the trustees of the settlement. There were some limitations in respect of what could be done with the mansion house on landed estates.
Without impeachment for waste, limited owners might execute very significant repairs and improvements including mines, tramways cutting down timber, and the maintenance, repair and improvement of buildings.
The tenant for life was given power to grant building leases for 99 years, mining leases for 60 years and others for 21 years subject to obtaining the best rent. Where it was customary, longer leases might be granted with consent of the court.
Other reforms eased the effect of the rules against perpetuity. The rules contained many technical anomalies. Apparently reasonable estates and powers could be rendered void by breach of rules, some of which were technical in origin with little rational justification.
Technical Reforms
At common law s contingent remainder had to be vested before the end of the preceding estate or it was void. There could be no gap. It did not matter if the gap arose by the forfeiture or merger or death. In order to prevent the operation of this principle, , it was necessary to appoint trustees to preserve contingent remainders.
Section 8 of the Real Property Act 1845 provided that no contingent remainder should fail by reason for the termination of an earlier estate by forfeiture, surrender or merger . The Contingent Remainder’s Act 1877 extended the provision so that the remainder would not terminate by the death of a proceeding life tenant.
The Accumulations Act passed in July 1800 prior to the Act of Union prohibited accumulations for longer than one of four alternative periods
- the life of the settler
- 21 years from his death,
- minority of a person living at his death or
- minority of person who if of full age would become entitled to the income.
This legislation was amended by the Accumulations Act 1892 which prohibited accumulation for the purpose of purchasing land for a longer period than the minority of the person who if of full age, would be entitled to receive the income which was to be accumulated.
Married Women
Until late 19th century reforms, a married woman, even though entitled to legal estate in fee simple could not sell, mortgage or deal with it in any way without the joinder of a husband or without going to artificial process which was expensive and restricted. At the start of 19th century, she should not make a will of her freehold land. She could not release her contingent right to dower on sale by her husband of her lands without suffering a fine (an artificial civil procedure).
The Fines and Recoveries (Abolitions) Act improved the position of a married woman somewhat and enabled her to dispose of her fee simple land by deed with approbation of her husband. This removed the friction of the fine mentioned above. The 1833 Act required her action to be acknowledged as a free act before a commissioner
The Married Woman’s Property Act 1870 made separate the property of rents and profits of real estate descending to a married woman as an heiress. The Married Woman (Property) Act 1882 effectively put married woman in the same position as men. Restrains on alienation could make married woman property exempt from creditors to a certain extent. The Conveyancing Act 1881 allowed the judge to remove a restrain against alienation if it was contrary to woman’s true interests
Infants
There was no court jurisdiction to order the sale or authorise the settlement by an infant of his property on marriage. A lease binding the infant could not be granted. Money spent on the estate could not be property secured.
A long minority could be disastrous to a locality where the landowner’s heir was underage. By an 1820 Act , a guardian has empowered with the direction of the Court of Chancery to make an ordinary mining or building lease of an infant’s land. The Infants Settlements Act 1855 allowed a male infant of 20 and female of 17 to make binding settlement on marriage with the sanction of court. The Partition Acts 1868 and 1876 allowed the court in a partition action where minor was interested, to order a sale and vest the property in a purchaser.
The Settled Estates Act allowed the court to order a sale where the infant was interested in settled land. It did not apply to infants entitled to fee simple in possession. It was so extended by section 41 of the Conveyancing Act 1881. By Section 42, trustees could be appointed on behalf of and infant with wide powers of management including carrying out repairs, working mines, etc.
The Settled Land Acts 1882 allowed the court to appoint persons to exercise on behalf of an infant, whether as tenant for life in fee tail or in fee simple, the powers of sale. partition exchange and leasing given by the Act to the tenant for life.
Persons of Limited Capacity
A ancient statute 17 Ed II provided that the King had custody of lands of persons of unsound mind, so called idiots, subject to supplying them with necessaries and returning the land to the heir at death. A so called lunatic was in a better position in that the King must see that the households were competently maintained out of rents and profits with surplus being kept for the use on recovery or if they died distributed for the good of their souls by the advice of the ordinary (church officer).
By 1853 Act, powers of sale and leasing were conferred on the Lord Chancellor in respect of the estates of persons who were not competent. The legislation became Lunacy Act 1890 in England and Wales and Lunacy Ireland Act 1871 in Ireland. Powers were conferred by masters in chancery to sell, mortgage improvement and lease the so called “lunatic’s” estate.