Last week we looked at the issue of dealing with life interests. In that note, we reminded practitioners of the “new” provisions of the Land and Conveyancing Law Reform Act 2009. We set these out and some other relevant rules for today’s blog, namely and in particular the following rules:-

• Section 11 – The only legal estates in land which may be created or disposed of are freehold and leasehold estates specified by section 11;

• Part 3 of the 2019 Act which relates to future interest and in particular section 15 which states that all future interests in land whether vested or contingent exist in equity only;

• Section 19, which states that the trustees of a trust for land where the trust is created by will, shall be either the trustees referred to in the will (see s. 19(1)(b)) or if there is none referred to in the will then, the testator’s personal representatives

• Section 19(1)(c) which is a cryptic type of provision which states that if land is purported to be vested in a minor after the commencement of the 2019 Act the trustees of such trust of land are the persons who would fall within the section 19(1)(b) of the Act “if the instrument vesting the land were deemed to be an instrument creating a trust of land“. So for our purposes, what this means is that if land is held by a minor under a will, then, a trust for land is created and the trustees will be either the trustees under the will or if none mentioned the per reps under the will.

All of the above has important consequences with respect to Land Registry practice. So what do you do if you have a will by a grandparent who is deceased and leaves a house to his child on trust for the benefit of the grandchildren?

In these cases your forms are Form 35 and Form 37.

For all you probate geeks out there, you immediately know that Form 35 is the form signed by the per rep assenting the property into the name of the beneficiary. You will also know that in testate cases that the beneficiary signs form 36, to allow him to be registered.

In cases where there is a trust for minors, the trustees of the trust don’t sign a form 36 but instead a form 37. This is then modified for the circumstances.

Form 37 does contain provisions setting out the inhibitions or burdens that the property may be subject. The temptation may be to put in an inhibition in favour of the minors. This is not generally required and is probably of dubious legal merit. It is possible to register the trustees under the will as the owners, be they the per reps or other trustees appointed in the will without the requirement to also have an inhibition registered. We have recently successfully completed such registration. To proceed with registration there is no need to put on the form an inhibition in favour of minors (although Form 37 kinda prompts one to do so). If one does, it will probably be queried by the Land Registry as it is generally accepted under Land Registry practice that minors cannot receive notices. Therefore the registration will be in the name of the trustees plain and simple and then assented to the minors in time once they come of age or otherwise as stipulated by the terms of the trust set up in the will.

This is not to say that it is not possible or good practice to register inhibitions when appropriate, in particular for the protection of beneficiaries over the age of 18.

You may get pushback from the Land Registry on this point because sometimes I find that even officials in the Land Registry are unsure about these provisions.

A third party with no notice will not be aware of the existence of the trust. That should not be a matter of concern for two reasons. First, because s. 21 of the 2009 Act gives a purchaser the benefit of the overreaching provisions in the Act (more about that later) and secondly, the role of trustees is to ensure that the funds are held for the benefit of the beneficiaries and that is not the concern of any purchaser.

Hope this helps and if you have any queries on probate, tax, capacity, or related property matters, please do not hesitate to reach out to me through the probate hub website. Colm Kelly