In a sale by two trustees where Form A (co-ownership) restriction exists, what is the effect on the buyer?

In a sale by two trustees where Form A (co-ownership) restriction exists, what is the effect on the buyer?

• A. It binds the buyer on completion
• B. It is overreached on completion and does not bind the buyer
• C. It remains a charge on the land after completion
• D. It is extinguished on completion

Answer: (B)

The concept being tested is overreaching of beneficial interests when land is held on trust by two or more trustees. When the property is sold by those trustees, the purchase price is paid to the trustees and, because there are at least two of them, the beneficiaries’ rights in the land are overreached. That means those rights no longer bind the land itself on completion; instead, they attach to the proceeds of sale. So, in a sale by two trustees, even if there is a Form A co-ownership restriction, the buyer takes the legal estate free from those beneficial interests and is not bound by them in relation to the land. The beneficiaries can still claim against the sale proceeds, not against the buyer’s title to the land.

The concept being tested is overreaching of beneficial interests when land is held on trust by two or more trustees. When the property is sold by those trustees, the purchase price is paid to the trustees and, because there are at least two of them, the beneficiaries’ rights in the land are overreached. That means those rights no longer bind the land itself on completion; instead, they attach to the proceeds of sale. So, in a sale by two trustees, even if there is a Form A co-ownership restriction, the buyer takes the legal estate free from those beneficial interests and is not bound by them in relation to the land. The beneficiaries can still claim against the sale proceeds, not against the buyer’s title to the land.