Page images

Conditions lots. The under-leases shall contain all necessary covenants Leasehold*. for mdenuiifyiug the several purchasers against the payment of the rent or performance of the covenants, in respect of any other lots than their own, and for securing the payment of the rent and performance of the covenants by the several purchasers in respect of their own lots. All the under-lessees shall execute counterparts of their leases, and all instruments required by this condition shall be prepared by and at the expense of the respective purchasers.

IX. That the purchaser of the largest part in value shall, after the sale of all the lots, be entitled to the custody of the lease, and such other of the muniments of title as are in the vendor's possession; but such purchaser shall enter into the usual covenants with the purchasers of the remainder of the said lots for the production of the said lease and muniments: if any lots shall remain unsold, the vendor shall retain the said lease and muniments, and enter into the usual covenants for their production with the purchasers of such lots as shall have been sold; such covenants, nevertheless, to be determinable on the vendor's parting with the said muniments, and procuring the person to whom they shall be delivered to enter into the usual covenant for their production with the persons then entitled to the benefit of the vendor's covenants. All such covenants, both original and substituted, shall be prepared by and at the expense of the covenantees (#).

X. That each purchaser shall, on the completion of the purchase, execute to the vendor a bond, in the sum of £ , for indemnifying him against the rents and covenants of the lease, so far as relates to the part of the property purchased by such purchaser; such bonds to be prepared by the vendor at the expense of the respective purchasers (A).

(g) Variations in the form of the condition given in the text will be found among the precedents of conditions relating to title deeds, with remarks on their application to different circumstances. They can be easily adapted to the case of leasehold property.

Obligation of W Th's condition is not strictly necessary, because, independently of assignee to in special stipulation, the assignor of a lease, whether he is the original XI. and XII. the same as Conditions VI. and VII. of Conditions


the Common Conditions of Sale of Freehold or Copyhold AS TO

Estate, ante, pp. 32—36.

SPECIAL CONDITIONS as to the Sale of Conditions
Leaseholds. as to


I. That the title shall commence with , dated ,

and no purchaser shall be entitled to call for the production of the original lease, or of any mesne assignments thereof, as the same are not now known to be in existence (a).

lessee or not, is entitled to a covenant from the assignee for indemnity demnify asagsinst the payment of the rent and the performance of the covenants; signer of a (Pember v. Matthew, 1 Bro. C. C. 52; Staines v. Morrit, 1 Ves. & Bea. 8); ^laicllcand that, too, even when the assignee gets no covenants for title. (Ib). The principal object of the condition is, to provide that the indemnity shall be given by bond, instead of being given by a covenant in the indenture of assignment, which does not remain in the possession of the vendor; and the condition also throws the cost of the bond on the pur


The assignees of a bankrupt leaseholder are not entitled to an indemnity against the rent and covenants, and ought not to stipulate for it ( Wilkms v. Fry, 1 Mer. 244; see, too, stat. 6 Geo. 4, c 16, s. 75).

(a) This condition is intended to be used upon the sale of a long term Stipulations on of yean, of ancient creation, and of which the deed of grant is lost. (See tne of a ante, Vol 1, p. 151; 1 Sugd. V. & P. 338). If the deed creating the of anc1ent term be in the possession of the vendor, the condition should be altered to the form following:—

"that the deed creating the term shall be produced, but the purchaser shall not be entitled to call for the production of, or to investigate, or to make any objection in respect of, the mesne assignments of the term or the title thereto,

prior to an indenture, dated the day of , with

which the title is to commence."

In cases of this kind, it will be prudent to preclude the purchaser from calling for the lessor's title, although, probably, the want of it would not be considered a valid objection to the title; certainly, it never would be called for, unless with a view to the rejection of the purchase.



Stipulations against shewing the equitable title to surrendered leases.

Evidence of ages of cestui que vies.

Case where a cestui que vie dies after the sale, before the completion of the purchase.

II. That no purchaser shall be entitled to call for the production, or make any objection in respect of the lease or leases which have been surrendered, prior to the grant of the subsisting lease (b).

III. That the ages of the several persons, for whose lives

the property comprised in lots and , is now held

on lease, are believed to be accurately stated; but the purchasers of these lots shall not require any evidence of the ages of these persons, except such as is in the vendor's possession, and shall make no objection on account of any inaccuracy in the statement of those ages (c).

(6) This condition applies to sales of renewable leaseholds, and is, in such cases, essential. (See ante, Vol. 1, p. 154; 1 Sugd. V. & P. 338).

But the form in the text is not adapted to the purpose of precluding a purchaser from requiring the equitable title to the surrendered leases, which, of course, attaches on the existing lease. In ordinary cases it is unnecessary, and would be very unfair to stipulate, that the purchasers shall not see the equitable title to the surrendered leases, because such a stipulation amounts to a condition, that the purchasers shall have no title at all. If, however, circumstances require such a condition, the vendor should state his intention in clear terms; he may effect this by subjoining to the condition in the text,

"or to call for the production of, or to investigate, or make
any objection in respect of, the legal or equitable title,
prior to the date of the subsisting lease."
Or he may stipulate expressly, that the title shall commence with the
subsisting lease, and that the purchaser shall have no right to investigate
the prior title, either legal or equitable.

(c) In the absence of special stipulation to the contrary, a purchaser is entitled to require evidence, that the ages of the cestui que vies shall be proved by extracts from the registers of their baptisms or births, or by other satisfactory evidence; and if such evidence can be procured, it is obvious, that recourse should never be had to any stipulation which precludes the purchaser from getting what he is fairly entitled to, and will reasonably expect. If, however, the vendor be unable to give strict proof of the ages of the cestui que vies, he must protect himself by a condition, and if the ages of the cestui que vies be stated in the lease, the form in the text, numbered (IV.) will be the one which, in all probability, will be the least alarming to a purchaser. It must be remembered, that if, after an agreement for a sale of an estate, holden for lives, one or more of the lives should drop before the completion of the purchase, the loss will fall on the purchaser. ( White v. Nutt, 1 P. Wms. 60; 1 Sugd.V. & P. IV. That the ages of the several persons, for whose lives Conditions

the property comprised in lots and are now held lea*ejolds.

on lease, are stated in the particular according to the state

ment of the ages in the lease, and such statement in the lease shall be taken by the purchasers as conclusive evidence of the ages of such persons (d).

CONDITIONS of Sale of Reversionary In- Conditions Terests, Life Interests, and Policies of "ions,"!*" Assurance (e).

ch. 5, sect. 2; see, too, Mead v. Davison, 3 Ad. & Ell, 303; Bacon v. Simpson, 3 Mee. & Wei. 78; see, however, infra, tit. Agreements, Precedent IV., notes. But if a life had dropped before the agreement for sale, and the purchaser were not informed of the fact, undoubtedly the sale would be void. And where, in the particulars of sale, property was stated to be held on three lives, and one of the lives had dropped before the sale, it was held, in an action for the deposit, that the auctioneer could not be called to prove that he had stated before the sale, that the life had dropped. (Bradshaw v. Bennctt, 5 Car. & Pay. 48). This is in accordance with the well-known doctrine, that the auctioneer cannot vary the printed or written particulars by verbal declarations. (1 Sugd. V. & P. 31; see, however, Bartlett v. PurneU, 4 Ad. & Ell. 792).

(d) See the preceding note.

(e) The conditions to be employed in sales of property of this descrip- Observations on tion, do not materially differ from the common conditions, of which the sales of reyerforms have been previously given. The word "assignment" should be 'j""^''^^'11" substituted for " conveyance," and such other alterations made as the

different nature of the property requires. Conditions, as to the evidence of the ages of the persons interested in the property, or on whose lives the insurances may have been effected, must be used, if legal proof cannot be had; the forms given, with regard to the ages of the cestui que vies of leases will furnish precedents of such condition. (See, ante, Special Conditions as to Leaseholds, Conditions III. and IV.). If the property sold yield no annual profit, as in the case of a reversion or a policy of assurance, the stipulation, that the purchaser, if the purchase be not completed on the day fixed, shall pay interest on his purchase-money from that day, should invariably be inserted in the conditions. If the property be a life interest in possession, the time from which the purchaser is to take the profits should be fixed; if no time be fixed, he will be entitled to the CONDITIONS Ag TO REVERSIONS, &C.

Description of property in particular.

Sales of policies of assurance.

profits from the time of the sale. (Anion v. Towgood, I Jac. & Walk. 637; see, too, Twigg v. Fifield, 13 Ves. 517). It has been decided, that a court of equity will decree a specific performance of a contract for sale of a life annuity, though the annuitant be dead at the time of the decree. (Kenncy v. Wexham, 6 Madd. 355).

The point principally to be attended to, in preparing particulars and conditions of sale of property of the nature above-mentioned is, that the interest offered for sale is accurately described. There is little difficulty in the case of a simple policy of assurance on a life, or a life interest hi possession, or an absolute vested reversion; but it is an operation of the greatest nicety and difficulty to frame a description which may be comprised within the ordinary limits of a particular, and shall, at tho same time, accurately and clearly define an interest contingent or presumptive, and liable to variation on many different events. The task is, in fact, that of attempting to state in a few words, the effect of long and complicated clauses, and frequently, as might be expected, is unsuccessful. The safest way in such cases is, to state generally the nature of the interest, and to produce, before or at the sale, a copy of the instrument under which the interest is held, in such a manner as to give a purchaser notice of the contents. If, however, the particular be unfair or fraudulent, a notice that the instrument, under which the interest sold is held, may be seen at a given place, and will be produced at the sale, does not necessarily impose an obligation on a purchaser to refer to that instrument; (Dyket v. Blake, 4 Bing. N. C. 463, 476); and, therefore, care should always be taken, that the particular, even if it do not contain a complete description, is free from any thing likely to mislead a purchaser. If the interest sold, be subject to the payment of legacy duty, or to any other deduction, of course the particular should disclose that fact.

In a recent case, Gilman Lucas being entitled to a contingent reversionary interest in an equal moiety of a sum of 2,0001., part of a larger sum then invested in the funds, advertised it for sale by auction, as a reversion to 1,000/., principal money, part of a sum of 20,000/., principal money, invested in the 3 per cent, consols, and assigned it to Bond, the purchaser at the sale, by the description of " all that sum of 1,000/. sterling, being one moiety of the said legacy or sum of 2,000/.;" under these circumstances it was held, that Bond was entitled to the surplus value which a proper ghare of the consols produced on the sale, and not merely to a sum of 1,000/. sterling. (Lucas v. Bond, 2 Keen, 136).

In respect to sales of policies of assurance on lives, the vendor should be prepared to prove that the person, on whose life the assurance is made, was in a good state of health when the policy was effected, and of the age mentioned in the policy, and that nothing has been done to vitiate the policy. The vendor may, of course, protect himself from such requisitions by special conditions of sale, but unless he use great caution in the matter, he will probably render his property unsaleable. On a sale by auction of a life interest, the life was described in the particular as that of a healthy gentleman, whose life was insurable, and an insurance

« PreviousContinue »