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Ferrishurst Ltd v Wallcite Ltd [1999] Ch 355; [1999] 2 WLR 667

Actual occupation applied to the whole land.

Facts:

The appellants, Ferrishurst, occupied offices on land owned by the respondents, Wallcite, under a sub-underlease that had been granted before Wallcite bought the land. This sub-underlease contained an option to purchase the offices and an adjoining garage which Ferrishurst did not occupy. Wallcite refused to grant the option. Ferrishurst claimed for specific performance of the option but failed. They then appealed.

Issues:

Ferrishurst argued that the option gave them an interest in both the offices and the garage which was overriding under s.70(1)(g) Land Registration Act 1925. They argued that this interest bound Wallcite. Under the 1925 Act an overriding interest included the interest of a person in actual occupation of the land. However, in Ashburn Anstalt v WJ Arnold & Co [1989] Ch1 the Court of Appeal had held that an occupier could only claim an overriding interest over land that it actually occupied. As Ferrishurst did not occupy the garage they could not claim an overriding interest in respect of it. Ferrishurst claimed this case was inconsistent with later House of Lords decisions.

Held:

The court allowed the appeal. Looking at the later House of Lords decisions, the court held that the wording of the 1925 Act meant that overriding interests of occupiers were not confined to the land which was actually occupied. The occupier could enforce an overriding interest in any part of the land which comprised the registered disposition, including land he did not actually occupy. Consequently, Ferrishurst could enforce the option in respect of the garage even if they did not occupy it.


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