VATLP28000 - Glossary of land terms
Note: that a glossary of Scottish law terms can be found in Notice 742/3.
A B C D E F G H J L M P R S T U V
A
| Term | Definition |
|---|---|
| Alienation Clause | A clause restricting a tenant’s right to assign the lease, sub-let, or part with possession. |
| Assignment | Transfer of the remaining term of a lease from the existing leaseholder (the assignor) to a new one (the assignee). The lease often stipulates that the landlord’s consent is required. Following assignment, the lease will be between the new leaseholder and the landlord. |
| Attestation Clause | Clause to a deed or similar document by which a witness certifies the signatory to be genuine. |
B
| Term | Definition |
|---|---|
| Beneficial Occupation | Occupation of land to the benefit (ie the advantage) of the occupier. |
| Beneficial Owner | A person who has effective ownership of property without actually holding title to it. |
| Best Rent | The highest rent that can be reasonably obtained. |
C
| Term | Definition |
|---|---|
| Charge | An interest in land which secures payment of a present or future debt. |
| Charge Certificate | In registered conveyancing this is the certificate issued by the Land Registry to the mortgage lender showing the entry of the charge on the Land Register. |
| Chargee | One who can enforce a charge ie mortgagee. |
| Chattels | Moveable personal property, for example, furniture and so on. |
| Commonhold | A form of property ownership conferring upon the owners of parts of a building, occupied in common, freehold interests in their parts (units) of the property. |
| Commonhold association | An association composed of owners of the commonhold units that own the freehold interest in the property’s communal areas and often its structure. |
| Completion | The final step leading up to a transfer of ownership of a property when the seller hands over the documents of title in exchange for the purchase price. |
| Completion Monies | The sum payable to a seller to complete a purchase. |
| Completion Statement | The statement prepared by the seller and sent to the buyer showing the exact amount payable on completion of the transaction. |
| Compulsory Registration | The requirement in areas of England and Wales that the transfer of land must be registered with the Land Registry. If the land is unregistered (ie when last sold the area was not designated an area of compulsory registration) an application must be made for first registration of title. |
| Contract | A document in two identical parts, one signed by the seller and one by the buyer which, when exchanged, binds the parties to complete the sale of the property ie transferring ownership for the purchase price. |
| Conveyance | The document which transfers legal interest in land from seller to buyer (not to be confused with conveyancing). |
| Conveyancing \n(legal definition) | The process of arranging an instrument which operates to pass an interest in property from one person to another. Conveyancing includes:- a mortgage, charge, assent, vesting declaration, vesting instrument, release and every other assurance of property or an interest therein by an instrument, except a will. |
| Covenant | A promise or undertaking in a deed whereby one party promises to do or not to do any act or to give something to another. |
D
| Term | Definition |
|---|---|
| Dead Rent | Relevant to mining leases this is a fixed rent payable whether the mine is worked or not. Will be topped up by royalty payments upon tonnage extracted/sold. |
| Deed | A written instrument signed, sealed and delivered. In practice the term is used to describe deeds, conveyances, mortgages etc according to the nature of the document. |
| Delivery | Delivery of a deed is held to take place when the document is handed over by the party executing the deed and accepted by the other party. Delivery is an essential element to complete a conveyance of land. |
| Demised area | The area of land that is the subject of a lease. Normally, a lease will clearly specify exactly what the demised area is. For example, if you purchase the leasehold interest of a flat, the lease might state that your interest applies to the interior partitions and plaster but not to the actual structure of the building. |
| Discharge of a Registered Charge | Document on which the lender acknowledges that all monies secured by the mortgage on a registered property have been repaid. |
E
| Term | Definition |
|---|---|
| Easement | A right enjoyed by the owner of a property over the land of his neighbour, for example, a right of way and so on. |
| Engrossment | The formal and final version of a property document prepared in readiness for signing and sealing. |
| Enquiries before Contract | Questions concerning a property which a buyer asks a seller. |
| Estate | Since 1925 only two legal estates have existed in land - the freehold and the leasehold estates. |
| Estate Agents \n(legal requirements) | Estate agents have no authority to enter a legally binding document on behalf of the prospective landlord. Such agents must be given clear and express authority (power of attorney) to act in this way. Where authority is given they are obliged to: make reasonable enquiries as to the solvency of the tenant, to obtain the best price reasonably obtainable, to disclose to the principal any other offers made. |
| Exceptions and Reservations | These are rights over adjoining and neighbouring properties retained when an owner sells part of a property. They can also be rights retained by a landlord over a leased property. They can include a right of way and so on. |
| Exchange of Contracts | The point in the procedures leading up to the transfer of land at which the seller signs an engrossment of the contract of sale and sends it to the buyer. Exchange can take place by telephone when acting solicitors confirm exchange or, more rarely, at the moment of posting by the seller. After exchange both parties are legally bound to go through with the transaction. |
| Execute | To sign or seal and deliver a deed in accordance with the appropriate formalities. |
F
| Term | Definition |
|---|---|
| Fee Simple | The most absolute and unqualified estate which a subject may possess in land - freehold. |
| Field Plan | The plan prepared for use with a particular registered property in the land register. |
| Freehold | Absolute right to possess land for an indeterminate time span (in contrast to leasehold where possession is limited in time). |
G
| Term | Definition |
|---|---|
| Good Leasehold Title | This is effectively the same as an absolute leasehold title with the difference that the right of the lessor to grant a lease has not been investigated by the district Land Registry, and the right of the lessor to grant the lease is not guaranteed. |
| Grant | The act that transfers an interest in or possession of land. |
| Grantor | The person who grants a new lease or transfers land or grants rights over land. |
| Ground Rent | Rent for the bare site, usually following a large premium paid at the commencement of the lease. |
H
| Term | Definition |
|---|---|
| Habendum | Clause containing a description of the commencement date and duration of the lease. |
| Headlease | A leasehold interest granted by a freeholder and subject to one or more underleases. (subleases). |
J
| Term | Definition |
|---|---|
| Joint and several covenant | When joint purchasers give a covenant it is usual for it to be expressed as ‘jointly and severally’. The effect is the covenant can be enforced not only against both covenantors, but against either of them at the option of the person in whose favour the covenant was given. |
| Joint tenancy | Form of ownership by two or more persons of the same property. Joint tenants have equal and undivided ownership of property. On death of a tenant his share passes to surviving joint tenants. |
L
| Term | Definition |
|---|---|
| Land \n(legal definition) | This is a general term encompassing every type of earth, ground or soil, such as heath, meadows, moors, woods and so on. It additionally includes those buildings conveyed with the land. The rights of ownership extend down to the centre of the earth and up to the sky, but restrictions can be brought to bear by easements and Town and Country Planning Acts. |
| Land Charges Registry | The Government Department which maintains a register of various charges on unregistered land. It should not be confused with the Land Registry which is only concerned with registered land. |
| Landlord | The owner of an interest in land who in return for rent (or a premium) has granted possession to another person. May also be known as a lessor. |
| Landlord \n(legal obligations) | To allow quiet enjoyment. Not to derogate from grant. To ensure premises are fit for human habitation at start of tenancy (where tenancy is furnished). |
| Leasehold | Land held for a fixed number of years granted by a lease. |
| Leaseholder | The person who holds land under a lease (also known as lessee). |
| Lease \n(legal requirements) | Most leases are created by a deed. Any attempt to create a lease orally or in writing is void at law, unless the lease is for less than 3 years, takes effect immediately in possession and is at the best rent reasonably obtainable without taking a premium. Also to take effect as a lease the tenant must be given exclusive possession of the land ie the right to exclude anyone including the landlord. |
| Licence | A ‘licence’ is permission to do something that would otherwise be unlawful. ‘Licences’ are granted in various different contexts and many have nothing to do with land. In a land context, you might come across various types of licences, but only one type of licence - a ‘licence to occupy’ - is capable of falling within the land exemption - guidance on ‘licences to occupy’ can be found in VATLP05620. Other types of licence (such as a licence to enter land to carry out building work, without having the right to occupy and exclude others) fall outside the scope of the land exemption. |
| Licensee | One who is granted a licence. |
| Local Search | An application made to the local authority regarding future developments, planning, roads, and so on. |
M
| Term | Definition |
|---|---|
| Merger of Interests | The submerging or drowning of a lesser estate in a greater estate because they coincide in one and the same person. Thus a leaseholder may buy the freehold of the property he occupies under the lease (the freehold reversion) and so hold both the freehold and the leasehold interests. The leasehold interest may be submerged in the fee simple and exist no more. The formal term sometimes used in a conveyance or transfer to give effect to a merger of interests runs ‘To the intent that the term granted for the lease shall forthwith merge and be extinguished in the fee simple thereof’. |
| Messuage | A house, bungalow etc comprising also outbuildings and gardens. |
| Mortgage | The deed whereby land is pledged as a security for a loan. |
| Mortgagee | The lender. |
| Mortgagor | The borrower. |
P
| Term | Definition |
|---|---|
| Parcels Clause | This defines with absolute accuracy the property included in the lease. |
| Penal Rent | A rent which exceeds the market rent, payable during a period of tenant default. |
| Peppercorn Rent | A token rent payable to a landlord (often following a premium representing the full value of the lease). May be a nominal amount of money or literally ‘one peppercorn per annum’ or ‘one English rose per annum’. It is rarely collected. |
| Planning Permission | Permission granted by a local authority to build on land (develop). Certain work is deemed by legislation not to require planning permission. Individual applications are not required if the development falls within one of these, but an application must still be made for building regulations consent if required. |
| Positive covenant | A covenant imposing a positive obligation to undertake some act. For example, leaseholders of flats might covenant to keep their property in good repair, or to decorate once every five years. |
| Profit à Prendre | Right to take something from another’s land for example, right to graze cattle, or take fish, gravel and so on. |
| Property Register | Kept by the Land Registry, it contains a description of registered land and any easements. |
| Proprietorship Register | Kept by the Land Registry, it specifies the type of title owned by the proprietor, for example, title absolute and gives the name and address of the registered proprietor and the date the proprietorship was registered. |
R
| Term | Definition |
|---|---|
| Rack Rent | Rent that represents the full open market value of the property, or near to it. |
| Realty | Real estate for example, freehold land. |
| Reddendum | The part of the lease specifying the rent to be paid or the basis of calculating it. |
| Registered Proprietor | A person who owns land with registered title. |
| Requisitions on Title | Written enquiries made by the seller before completion concerning queries or apparent defects in the title. |
| Restriction | An entry on the land register prohibiting partly or wholly the exercise of a proprietor’s power to deal in the land. |
| Restrictive Covenant | A covenant that obliges the covenantor to refrain from doing certain things. For example, a freeholder of a house might covenant not to keep caravans on his front drive, or not to keep pigs. |
| Reverse assignment | A term used to describe an arrangement under which a tenant pays a third party to take on the lease. |
| Reverse premium | A landlord pays a prospective tenant to accept the lease. |
| Reverse surrender | A term used to describe an arrangement under which a tenant pays a landlord to take back the lease. |
| Rights of the Mortgagor | The equity of redemption , for example, to redeem on the legal date the capital sum due. |
| Root of Title | The title deed being at least 15 years old, with which a seller of unregistered land commences his abstract of title. |
S
| Term | Definition |
|---|---|
| Seal | A red wafer affixed to a document alongside the signature. |
| Search | An application for information recorded in the official records of a local authority, district registry or the land charges registry. The official certificate provided by the Registries is also known as a ‘search’. |
| Stakeholder | One who holds money pending the outcome of an event and not as agent of one of the parties, normally a solicitor or an estate agent. |
| Stamp Duty Land Tax | A tax levied on the transfer, conveyance or assignment of land. SDLT is generally calculated as a percentage of the VAT inclusive selling price. |
| Subject to Contract | A provisional contract not meant to be legally binding. |
| Surety | A person who offers security for payment of a debt, performance of an obligation, or the appearance of someone else in court. |
| Surrender | The transfer of the remaining term of a lease from an existing tenant to the landlord. |
T
| Term | Definition |
|---|---|
| Tenancy at will | A tenancy of no fixed term that does not give the tenant security of tenure. It can be terminated without notice by either party. Suitable as a temporary arrangement. |
| Tenant | Person who rents property/land from a landlord. |
| Tenant \n(legal requirements) | To pay rent. To use premises in a tenant like manner. To allow landlord to enter and view if he is under obligation to repair. |
| Tenants in Common | An undivided ownership of land by two or more persons whose shares need not be equal. Each owner may freely dispose of his share. On death the owner’s share forms part of his estate. |
| Tenement | A general term meaning a freehold or leasehold property. |
| Title | Ownership of a property. |
| Title Absolute | The highest form of freehold title under the system of Land registration. Absolute leasehold is the highest form of leasehold title granted. |
| Title Deeds | The deeds and other documents which prove title to unregistered freehold or leasehold land. |
| Transfer | A deed which transfers title to freehold or leasehold registered land. |
U
| Term | Definition |
|---|---|
| Underlease | A lease granted by a lessee. |
| Unilateral Notice | An entry on the land register that prevents the registered proprietor of the land from dealing in it without the Land Registrar first giving notice to the beneficiary of the notice. |
V
| Term | Definition |
|---|---|
| Vendor | A person selling a property. |
Note: that a glossary of Scottish law terms can be found in Notice 742/3.