Q&As

Company X was the registered proprietor of both a registered freehold and two registered leases but no application was made to the Land Registry to merge the titles on acquisition. X subsequently transferred the freehold to Y with the intention that the freehold was unencumbered by the leases and X was struck off the register of companies on the assumption that its property interests had all been disposed of. Y sold part of the freehold to Z. Can Y and Z now apply to the Land Registry to retrospectively merge the freehold and leasehold estates, remove the entries for the leases from the freehold titles and close the leasehold titles?

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Published on LexisPSL on 24/06/2021

The following Property Q&A provides comprehensive and up to date legal information covering:

  • Company X was the registered proprietor of both a registered freehold and two registered leases but no application was made to the Land Registry to merge the titles on acquisition. X subsequently transferred the freehold to Y with the intention that the freehold was unencumbered by the leases and X was struck off the register of companies on the assumption that its property interests had all been disposed of. Y sold part of the freehold to Z. Can Y and Z now apply to the Land Registry to retrospectively merge the freehold and leasehold estates, remove the entries for the leases from the freehold titles and close the leasehold titles?
  • Merger
  • Intention
  • Striking off/Bona vacantia

Company X was the registered proprietor of both a registered freehold and two registered leases but no application was made to the Land Registry to merge the titles on acquisition. X subsequently transferred the freehold to Y with the intention that the freehold was unencumbered by the leases and X was struck off the register of companies on the assumption that its property interests had all been disposed of. Y sold part of the freehold to Z. Can Y and Z now apply to the Land Registry to retrospectively merge the freehold and leasehold estates, remove the entries for the leases from the freehold titles and close the leasehold titles?

Merger

A lease may terminate as a result of merger when both the lease and the reversion on that lease become vested in the same person (Rye v Rye) and in the same capacity. If one interest is held, for example, as administrator or executor of a deceased person, while the other is held in a personal capacity, there can be no merger.

However, merger does not arise automatically when that vesting occurs. This is because in equity, a merger is a matter of intention. The law follows this approach because of section 185 of the Law of Property Act 1925, which states that there will not be a merger by operation of law of an estate

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