SQE1 FLK2 Practice Paper 9

A registered proprietor grants a legal charge over their property to Bank A. The charge is registered. Subsequently, the proprietor grants a second legal charge to Bank B, which is also registered. The proprietor defaults on both loans. Bank B wishes to sell the property. Which of the following is correct? A) Bank B can sell the property free from Bank A's charge B) Bank B can sell the property but Bank A's charge will remain on the title C) Bank B cannot sell the property without Bank A's consent D) Bank B can sell only if it pays off Bank A's charge from the sale proceeds first

A defendant is charged with fraud by false representation under s.2 of the Fraud Act 2006. The prosecution alleges that the defendant made a false representation to obtain a bank loan. However, the bank manager testifies that she did not believe the representation and would not have granted the loan regardless. Does this affect the defendant's liability? A) Yes, because the representation did not actually deceive anyone B) Yes, because the offence requires the victim to have been deceived C) No, because fraud by false representation does not require the victim to be deceived D) No, but it reduces the seriousness of the offence for sentencing purposes

A solicitor acts for a client who is selling a property and purchasing another. On completion day, the solicitor receives the sale proceeds of £300,000 into the client account at 10am. The purchase price of £280,000 needs to be sent at 2pm. In the interim, the solicitor uses the £300,000 to complete another client's purchase for £290,000 at 11am, intending to replace the money before 2pm from the other client's mortgage advance expected at 1pm. Is this permissible? A) Yes, because the money will be replaced before it is needed B) Yes, provided the solicitor records the temporary borrowing in the accounts C) No, because this constitutes using one client's money for another client's transaction D) No, unless both clients have given written consent

A testator executes a will in 2020, leaving their estate to their two children equally. In 2022, the testator marries. In 2023, the testator dies without having made a new will. What is the effect of the marriage on the 2020 will? A) The will remains valid as marriage does not affect existing wills B) The will is revoked by the marriage and the estate passes under the intestacy rules C) The will is revoked only to the extent of the spouse's entitlement under the intestacy rules D) The will is partially revoked - the spouse takes a statutory legacy and the children share the remainder

A charitable trust is established for "the advancement of education in the city of Manchester." The trust produces more income than can reasonably be applied for this purpose. The Charity Commission considers applying a cy-pres scheme. Which of the following grounds for cy-pres is most applicable? A) The original purpose has been fulfilled as far as possible B) The original purpose cannot be carried out, or not according to the directions given C) The original purpose has been adequately provided for by other means D) The purpose has ceased to provide a suitable and effective method of using the property, having regard to the spirit of the gift

A buyer purchases a property that is subject to a restrictive covenant entered into in 1950, prohibiting the use of the property for any trade or business. The covenant was entered into between the original covenantor and covenantee, neither of whom now owns the relevant land. The buyer wishes to operate a small business from the property. Under what circumstances will the burden of the covenant bind the buyer? A) The burden runs with the land automatically in all cases B) The burden runs if the covenant was made for the benefit of the covenantee's land, touches and concerns that land, and was intended to bind successors C) The burden runs only if it is registered as a land charge (for unregistered land) or noted on the register (for registered land), and the requirements of Tulk v Moxhay are satisfied D) The burden never runs at law or in equity

A defendant is charged with murder. The defendant claims they killed the victim after the victim threatened to reveal embarrassing information about the defendant's past. The defendant states they lost control and struck the victim repeatedly. Can the defendant rely on the partial defence of loss of control? A) Yes, because the defendant lost self-control due to the victim's words B) No, because a threat to reveal embarrassing information does not constitute a qualifying trigger C) Yes, if a person of the defendant's sex and age might have reacted in the same way D) No, because the defence of loss of control has been abolished

A solicitor holds client money on a general client account. The account earns interest of £500 over three months. Under the SRA Accounts Rules, what must the solicitor do with the interest? A) Pay all interest to the client promptly B) Pay a fair sum in lieu of interest to the client C) Retain the interest for the firm as it is earned on the firm's account D) Pay the interest to HMRC as tax on the client's behalf

A couple purchase a property together. The transfer states they are to hold the property as beneficial joint tenants. Ten years later, one party serves a written notice of severance on the other. What is the effect of this notice? A) The joint tenancy is severed and the parties hold as tenants in common in equal shares B) The joint tenancy can only be severed by mutual agreement, not unilateral notice C) The notice must be registered at the Land Registry to be effective D) The joint tenancy is severed but the shares are determined by the parties' respective contributions

A deceased's estate includes a debt of £50,000 owed to a trade creditor and £30,000 owed to HMRC for unpaid income tax. The estate has insufficient funds to pay all debts. In what order should the personal representative pay these debts? A) HMRC takes priority as a Crown debt B) Both debts rank equally as unsecured debts and should be paid pari passu C) Trade creditors take priority over HMRC D) The personal representative has discretion to choose which creditor to pay first

A trustee invests trust funds in a speculative cryptocurrency venture without considering the standard investment criteria under the Trustee Act 2000. The investment loses 80% of its value. Which of the following remedies is available to the beneficiaries? A) The trustee must restore the trust fund to the value it would have had if properly invested, plus interest B) The beneficiaries can only recover the amount actually lost C) The trustee is liable for the full value of the original investment D) The beneficiaries must accept the loss as investment risk is inherent in trusteeship

A defendant is convicted of an offence triable either way at the Crown Court. The judge considers the offence crosses the custody threshold. Before imposing a custodial sentence, what must the judge consider? A) Only the seriousness of the offence B) Whether a fine or community order could adequately deal with the offence C) Whether the offence is so serious that neither a fine alone nor a community order can be justified for the offence D) Whether the defendant has previous convictions

A solicitor is acting for a buyer in a purchase of commercial property. The property is held under a 25-year lease with a rent review clause providing for upward-only rent reviews every 5 years. The current rent is £50,000 per annum and the next review is in 6 months. What is the most important advice regarding the rent review? A) The rent cannot increase by more than inflation at each review B) The buyer should commission a valuation to assess the likely reviewed rent before exchanging contracts C) Upward-only rent reviews are prohibited by legislation for commercial leases D) The buyer can renegotiate the rent review terms with the landlord after purchase

A proprietary estoppel claim arises when A builds a house on B's land with B's knowledge and encouragement, believing the land has been promised to them. B now seeks to evict A. For A's proprietary estoppel claim to succeed, which elements must be established? A) A written promise, detrimental reliance, and unconscionability B) An assurance or representation, reliance on that assurance, and detriment suffered as a result C) A contractual agreement, consideration, and part performance D) An express trust declaration and detrimental reliance

A defendant is arrested and detained at a police station. After 24 hours, the police wish to continue detention. An officer of the rank of superintendent authorises continued detention for a further 12 hours. What is the maximum total period the defendant can be detained without charge before the police must seek a warrant of further detention from the magistrates' court? A) 24 hours B) 36 hours C) 48 hours D) 96 hours