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A landlord holds the reversion during a lease

A worked RES examination question on leases and reversions, from our Paper 1 bank — with the rule it turns on, and why each of the four options is right or wrong.

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The question

What did Mr Ganesh hold in respect of the ground floor during the currency of the bakery's lease, and what has he now agreed to sell?

Which statement is correct?

  1. A. He held the reversion, and it is the reversion that passes to Mr Pillai on completion.
  2. B. He held nothing during the lease, and only the upper floors pass to Mr Pillai on sale.
  3. C. He held a remainder, being the interest of a person entitled after a carve-out ends.
  4. D. He held the reversion, which ends on the sale and revives in Mr Pillai on expiry.

The answer, and why

Answer: A

The rule. A landlord holds the reversion during a lease, and it is the reversion he sells.

Why A is correct. Reversion held, reversion sold.

The other options.

  • B says he held nothing in respect of the ground floor
  • C calls it a remainder
  • D has the reversion ending and reviving.

Exam note. Mr Pillai is buying a tenanted building. What he acquires in respect of the ground floor is the right to receive rent and to recover possession in nine years.

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