LAW REFORM: ASSIGNMENT OF SATISFIED TERMS.
Iw the legal phraseology of England, an "estate" signifies the title or interest which a man has in lands or other effects- The freehold or absolute right of property in land is an " estate"; a personal interest in land for a term of years is also an " estate." An estate in land for a term of years five hundred it may be, or a thousand—is often created and granted to a person for himself, or in trust for another, as a security for money lent or conveyed under a marriage or testamentary settlement. As this estate for a term of years is conveyed absolutely in form, but with the in- tention that it shall belong to the grantee only until he has received the money lent or settled upon him, equity would dictate that as soon as payment of the debt has been made by the owner of the land in freehold, the estate for a term of years should ipso facto revert to him, or, in other words, cease to exist. And in every country of Europe except England, we believe, this is the role of law. But English courts of law regard estates as much more important entities than persons; and unless the estate for a term of years is declared to be extinguished by an express provision in the deed of grant, or is expressly assigned to the owner of the freehold or some one in trust for him, after his debt has been paid, it remains in the grantee ; and he can assign to a third party, although the object for which it was vested in him has ceased. And even when the estate for a term of years has been assigned to the owner of the inheritance, it continues to be, in the eye of the law, a separate estate. A satisfied term assigned to the owner of the lands over which it has been consti- tuted, is called " an attendant term " ; one not so assigned, an " outstanding term."
In so far as the original owner of the freehold is concerned, this shadowy title—this abstract idea of an estate—is of no con- sequence. But when the freehold property is conveyed by him to another, absolutely or in security for a debt, the satisfied term, as lawyers call it, becomes a troublesome and mischievous entity. The way in which this vampire title may cut up the substance Of a real estate, will appear from the following passage in the Second Tteport of the Real Property Commissioners—" The owner of the inheritance, with the benefit of an attendant term, makes a settle- ment or mortgage, or confesses a judgment ; and no step is taken to make the term a protection to the settlement, mortgage, orj judg- ment. He afterwards conveys the inheritance to a purchaser for valuable consideration, who has no notice of those acts of the vender, and who takes the precaution to obtain the command of the term by an assignment of it to a trustee for his benefit. If the persons claiming under the settlement, mortgage, or judgment, institute proceedings against the purchaser for the establiihment of their claims, he may defend himself by setting up the term. The term being for a long period, generally for many hundred years, operates virtually as a bar to these claims. The term being kept on foot, each successive purchaser for valuable con- sideration, without notice, may, by having it assigned to a trustee of his own nomination, avail himself of it as a protection against all estates and charges made from the time of its creation down to the time of his own purchase." The only use, therefore, of those legal fictions called outstanding or attendant terms, is to oblige two honest men to go to law before they can decide which is to have recourse against a knave, who first mortgaged his property and then sold it as free from incumbrance ; or, in the words of Lord Langdale, " to protect one innocent party at the expense and to the grievous prejudice of another" ; or, in the less courtly language of the Real Property Commissioners, " to trans- fer the injurious consequences of fraud from one innocent party to another, and generally to postpone or exclude a person who had, by priority of time, the best equitable claim." This is not the only injury to which the fiction of outstanding or assigned terms gives occasion. Any protection the assign- ment of a term may bestow is purchased by an enormous increase in the expense, delay, and difficulty of alienating property. Whenever there is an outstandinc, term, the title to the term must be shown in the same way as the title to the freehold. If this is done in one deed, it is necessarily longer than if the inheritance alone were conveyed ; and if, as is generally advisable, the in- heritance and the outstanding term are conveyed by separate deeds, that which transfers the latter is not unfrequently much longer than the other. It often happens that there are several attendant terms on the same land, or different terms comprising different portions of the same fee-simple property ; and then it is generally deemed prudent to keep all of them afoot, in order that if one term fail to protect the purchaser he may fall back on another. In short, the purchaser of one fee-simple estate may find it necessary to have as many deeds of conveyance executed as if he had purchased a dozen. To this primary source of mon- strous and oppressive expense is to be added the difficult and te- dious and costly searches which are often necessary in order to trace the title to a term derived from wills or administrations, and the danger of finding such a title invalidated from probate or ad- ministration having been taken or granted in wrong courts. And after all, the assignment of a term affords at best a precarious and uncertain protection to a purchaser, and may also lead to the defeat of his rights. He never can be certain that the term Which appears on a title produced to him really is the oldest or only term, or that it has not been previously transferred by a deed concealed from him. And if a preferable term exists which is not secured to him, it may be used against him as a weapon of attack : the very system to which he resorts for protection may be the cause of his eviction. The expense, however, is inevitable; for as the law now stands, he cannot be advised to dispense with the attempt to obtain protection. The whole of this injury and annoyance and oppression originates in the imaginary eternity which the law attributes to its own fictitious entities, "estates for a term of years." If on the repayment of money lent or the discharge of debts constituted by settlements, the estate for a term of years, created in order to afford security to the creditor, had from the first been held to be ipso facto of the discharge extinguished—as is the doctrine of the civil law and everymodern European law except that of England— the mammoth deeds of conveyance, the endless law-pleas, and the insecurity of property to which outstanding and assigned terms give occasion, never could have existed. By cutting off these deliberate figments or lies of lawyers, all the litigation and other evils arising from them would necessarily surcease. The judges have of late years shown themselves ashamed of these mischievous brain-children of their predecessors in office, and have attempted to throw them overboard. When the purposes for which a term was created are satisfied, courts of law, with a view to expedite justice and save expense, frequently direct a jury to presume its surrender. This fiction, resorted to in order to neutralize the unjust operation of an older fiction, may obviously prejudice the just rights of parties where terms have been expressly assigned to attend the inheritance ; yet courts of law have repeatedly ruled that the presumption of surrender extends to such cases. This superfcetation of legal fictions, as usual, only makes bad worse : it renders the law more perplexed and uncertain, and leaves outstanding and assigned terms to work all the mischief they have hitherto done, while it renders them still more precarious and illusory instruments of protection. Since, then, the assignment of outstanding terms is found of doubtful benefit, obtained rather by chance than any system of protection, and by certain expense and difficulty, its abolition cannot fail to be of advantage in all future dealings in land. . This conclusion .once arrived at, the means of abolishing the system appeared' simple and easy. Subject to a provision protect- ing persons for whose benefit terms were already assigned, it was only necessary to enact that all satisfied terms, which either by express declaration or by operation of law are attendant upon tole inheritance, shall merge in it.; but shall afford to every person dealing with the lands the same protection against incumbrances as if they had continued to exist. This practice of determining all terms of years by act of Parliament is already universal in railway acts : all, therefore, that remained to be done, was to ex- tend to the general public a privilege which railway companies have for some time enjoyed exclusively. This has been effected by the last of Lord Brougham's nine law-bills, to which we adverted in the Spectator of 30th August as having escaped shipwreck—the act 8 and 9 Victoria cap. 112, entitled " an Act to render the Assignment of Satisfied Terms un- necessary." This statute consists of only four brief clauses ; two of which are merely formal—one relating to the " construction " of the act, and the other declaring that it does not extend to Scot- land, By the first of the really enacting clauses it is declared, that on the 31st of December 1845, all existing attendant terms shall cease and determine ; but that such attendant terms, if con- stituted by express declarations, shall afford to purchasers and others the same protection as if they continued to exist. The second clause simply provides that all terms which shall become " attendant " after the said 31st of December shall merge in the inheritance. By the operation of these two brief clauses, existing rights are preserved intact, and a monstrous fiction, the fertile source of expense, precarious property, and vexatious litigation, is lopped off from our legal system, and all its progeny with it.
Thanks to the least popular branch of the Legislature, the pro- gress of law reform has not been absolutely stopped. Lords Campbell and Lyndhurst occasionally do something in that way; but Lord Brougham has done and is doing most to keep the ball in motion. It is a fashion among certain writers of novels and smart articles to disparage Lord Brougham's skill in the techni- calities of law, and the value of his efforts in the cause of law re- form. So very bad a lawyer as they represent him, could not, we imagine, have been for many years one of the leaders of a circuit. But, in attempting to estimate Lord Brougham's merits as a legislator, they mistake his position. He is not an inventor in the science of legislation, like Bentham : he may not be so minutely learned in technicalities as the able lawyers who composed the Real Property Commission, or the not less able conveyancers who were examined by the Commissioners ; though his practical com- mand of law is such as few men of the bar attain to, and among those who can rise to general conceptions Henry Brougham occu- pies a high position. His peculiar power is in his sleepless energy, the intuitive quickness with which he seizes upon the results of the labours of others, and reproduces them with his own illus- trations. He could not have furnished the suggestions of Messrs. Christie, &c. ; nor could he perhaps even have compiled the learned digests of the Real Property Commissioners, or matured by patient labour the bills for conveyancing reform, the fruits of the unostentatious industry of the Law Amendment Society,--- among whom it is no more than justice to name with especial honour Mr. Stewart, late Member for Honiton : but among all these learned lawyers, there is not one who like Lord Brougham could render the reforms they contemplate distinctly intelligible to non-professional apprehension, and rouse general sympathy to support them. His great movement in 1828 is operating bene- ficially even now.
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