SQE1 · FLK2 · Free samples
Property Practice — free SQE1 sample questions
50 free, worked single-best-answer questions for Property Practice, shown in the official SRA SBAQ format with the correct answer and a cited rationale. Drill the full bank in timed practice once you’ve worked through these.
Question 1
A lender advances £200,000 secured by a first legal charge over a residential property valued at £350,000. The borrower defaults. The lender appoints a receiver who sells the property for £320,000 after marketing for three months. A surveyor's report obtained before sale valued the property at £340,000. The borrower claims the lender is liable for the shortfall between the sale price and the surveyor's valuation. Is the lender liable?
- A.Yes, because the lender must obtain the best price reasonably obtainable
- B.Yes, because the lender owed a duty to follow the surveyor's valuation exactly
- C.No, because the lender's only duty is to act in good faith
- D.No, provided the sale price was within the permissible range for a reasonable sale and proper steps were taken✓ correct
- E.Yes, because the lender must account to the borrower as a trustee of the power of sale
Why D is correct
In *Cuckmere Brick Co Ltd v Mutual Finance Ltd* [1971] Ch 949 and *Silven Properties Ltd v Royal Bank of Scotland plc* [2003] EWCA Civ 1409, the Court of Appeal held that a mortgagee exercising the power of sale must take reasonable care to obtain the true market value (or proper price), but is not a trustee and need not obtain the absolute highest offer. A sale within a reasonable range after proper marketing will not render the lender liable. Option A overstates the duty. Option E is wrong: the lender is not a trustee of the power itself, only of any surplus proceeds.
Question 2
A landlord grants a 10-year lease of commercial premises to a tenant. The lease contains a covenant prohibiting assignment without the landlord's consent. Five years into the term, the tenant requests consent to assign to a reputable company with strong financials. The landlord refuses consent because the proposed assignee is a competitor of the landlord's own business. The lease was granted in 2020 and contains no express provisions regarding reasonableness of withholding consent. Can the landlord lawfully refuse consent on this basis?
- A.Yes, because the landlord has absolute discretion under the express covenant
- B.Yes, because protecting business interests is always reasonable
- C.No, because the Landlord and Tenant Act 1988 deems such refusal unreasonable
- D.No, because section 19(1)(a) of the Landlord and Tenant Act 1927 implies a reasonableness requirement and competition alone is generally insufficient✓ correct
- E.No, because the lease is a new tenancy under the Landlord and Tenant (Covenants) Act 1995
Why D is correct
Section 19(1)(a) of the Landlord and Tenant Act 1927 implies a term that consent shall not be unreasonably withheld into qualified covenants against assignment. In *International Drilling Fluids Ltd v Louisville Investments (Uxbridge) Ltd* [1986] Ch 513, the Court of Appeal held that refusal based solely on the landlord's own commercial competition was unreasonable. Option A is wrong because absolute discretion is negated by s.19(1)(a). Option C misstates the LTA 1988, which imposes a duty to act reasonably but does not deem specific grounds unreasonable. The case law establishes competition as insufficient grounds.
Question 3
A client purchased a residential property for £280,000 on 1 February 2024. This is the client's first property purchase and she will live in the property as her main residence. She paid a 10% deposit on exchange and the balance on completion. The property is located in England. What is the client's Stamp Duty Land Tax liability?
- A.£0✓ correct
- B.£1,400
- C.£2,900
- D.£3,400
- E.£11,900
Why A is correct
Under the Finance Act 2003, first-time buyers purchasing a residential property for no more than £625,000 benefit from First-Time Buyers' Relief. Properties up to £425,000 incur no SDLT; the relief applies to the first £425,000 of properties up to £625,000. Since the purchase price is £280,000 and the client qualifies as a first-time buyer using the property as her main residence, the SDLT liability is £0. Option B (£1,400) would apply if standard residential rates applied (5% on the portion from £250,001–£280,000), but this ignores the relief. The relief was extended in November 2022.
Question 4
A borrower granted a legal charge over registered land to a lender in 2019. In 2023, the borrower defaulted and the lender wishes to exercise its power of sale. The mortgage deed contains no express provisions regarding the power of sale. The borrower is three months in arrears, totalling £8,000. Interest payments of £2,500 per month remain unpaid. Has the power of sale arisen and become exercisable?
- A.The power has arisen but is not yet exercisable because six months' arrears are required
- B.The power has arisen and is exercisable because the mortgage money is due and interest is two months in arrears✓ correct
- C.The power has not arisen because the mortgage deed contains no express power of sale
- D.The power has arisen but is not exercisable until a court order is obtained
- E.The power has arisen and is exercisable only if the lender serves a notice under section 146
Why B is correct
Section 101 of the Law of Property Act 1925 implies a power of sale in every mortgage by deed once the mortgage money becomes due (typically the legal date for redemption, usually very early). Section 103 makes the power exercisable when, inter alia, interest is two months in arrears. Here, the borrower is three months in arrears, satisfying s.103(i). Option A is wrong because there is no six-month requirement in statute. Option D incorrectly suggests court involvement is mandatory for power of sale (it is not, though advisable). Section 146 (option E) applies to forfeiture of leases, not mortgages.
Question 5
A tenant holds a 15-year lease of a warehouse granted in January 1994 under the Landlord and Tenant Act 1954 Part II. The lease contains a qualified covenant against assignment. The tenant assigns the lease to an assignee in 2021 with the landlord's consent. The assignee defaults on rent in 2024. The landlord wishes to pursue the original tenant for the unpaid rent. Which of the following most accurately states the legal position?
- A.The landlord may pursue the original tenant, but only if a notice under section 17 of the Landlord and Tenant (Covenants) Act 1995 is served on the original tenant within six months of the charge falling due.✓ correct
- B.The landlord may pursue the original tenant without any procedural requirement, because the lease pre-dates 1 January 1996 and the 1995 Act does not apply to old tenancies.
- C.The landlord cannot pursue the original tenant because the Landlord and Tenant (Covenants) Act 1995 releases former tenants on lawful assignment regardless of when the lease was granted.
- D.The landlord cannot pursue the original tenant because, once the landlord consented to the assignment, privity of contract between landlord and original tenant was extinguished.
- E.The landlord may pursue the original tenant for arrears, but only for rent accruing within the six months immediately preceding the assignment.
Why A is correct
**Why A is correct** The lease was granted in 1994, before 1 January 1996, so it is an **'old tenancy'** to which the privity-of-contract regime under the common law continues to apply. The original tenant therefore remains liable throughout the term for rent and other covenants notwithstanding assignment — confirmed by *Estates Gazette Ltd v Benjamin Restaurants Ltd* [1994] 2 EGLR 43 (CA). However, although the Landlord and Tenant (Covenants) Act 1995 does **not** release former tenants of old tenancies (s 2 confines automatic release to 'new tenancies'), it **does** impose a procedural requirement on landlords who wish to recover a **'fixed charge'** (which includes rent) from a former tenant of **any** tenancy — old or new. Under **s 17(2) LT(C)A 1995**, the landlord must serve a prescribed notice on the former tenant **within six months** of the date on which the charge became due, informing them that the charge is due and that the landlord intends to recover it. Failure to serve the notice in time extinguishes the landlord's right to recover that fixed charge from the former tenant: *s 17(3)*. Accordingly, the landlord **can** pursue the original tenant (privity of contract survives), but **only** if the s 17 notice is served within the six-month window. Option A correctly captures both the survival of liability and the s 17 procedural condition. **Why the other options are wrong** - **B** is incorrect because, while it is true that privity of contract survives for old tenancies, the s 17 notice requirement applies to old tenancies as well as new ones and cannot be ignored. - **C** is incorrect: s 5 LT(C)A 1995 (automatic release on assignment) applies only to **new tenancies** granted on or after 1 January 1996; the 1994 lease is an old tenancy. - **D** is incorrect: consent to assignment does not, of itself, release the original tenant from privity of contract under the old regime. - **E** is incorrect: there is no rule limiting the original tenant's liability to rent accruing within six months of the assignment; the six-month period in s 17 relates to the window for serving the notice after each charge falls due, not to the period before assignment.