Overreaching—sales by trustees of land
Overreaching—sales by trustees of land

The following Property practice note provides comprehensive and up to date legal information covering:

  • Overreaching—sales by trustees of land
  • What happens to the equitable interests?
  • Requirement for capital moneys
  • What is a trust corporation?
  • Which equitable interests are not overreached?
  • What to do where there is only one trustee
  • Registered land—what to look out for
  • Registered land—overriding interests
  • Unregistered land—what to look out for
  • Powers of attorney and co-owners
  • More...

Broadly, the doctrine of overreaching enables purchasers (which includes tenants and mortgagees) in good faith for money or money’s worth to rely solely on the legal title. In the case of registered land, this means the entries entered on the register of title, as it records ownership of the legal estate and is not concerned with equitable interests.

A buyer of a legal estate in land from trustees will not be affected by any of the trusts on which the land is held if the purchase price is paid to all the trustees (of whom there must be at least two) or to a trust corporation. Payment of the price in this manner means that the interests of the beneficiaries are said to be ‘overreached’. This is commonly known as the 'two trustee' rule.

Overreaching also occurs in sales:

  1. under the powers of the Settled Land Act 1925

  2. by a mortgagee (see Overreaching by a mortgagee) or personal representative

  3. under a court order

This Practice Note deals only with sales by trustees of land.

What happens to the equitable interests?

If the purchase price is paid to at least two trustees or a trust corporation, the buyer takes the legal estate free from the equitable interests (which attach to the proceeds of sale) unless:

  1. in the case of registered land, there was an entry on the register limiting the

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