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Statute of Uses 1535

One area in which the Court of Chancery assumed a vital role was the enforcement of uses, a role that the rigid framework of land law could not accommodate. This role gave rise to the basic distinction between legal and equitable interests.

In order to avoid paying land taxes and other feudal dues, lawyers developed a primitive form of trust called 'the use' that enabled one person (who was not required to pay tax) to hold the legal title of the land for the use of another person. The effect of this trust was that the first person owned the land under the common law, but the second person had a right to use the land under the law of equity.

Henry VIII enacted the Statute of Uses in 1535 (which became effective in 1536) in an attempt to outlaw this practice and recover lost revenue. The Act effectively made the beneficial owner of the land the legal owner and therefore liable for feudal dues.

The response of the lawyers to this Statute was to create the 'use upon a use'. The Statute recognized only the first use, and so land owners were again able to separate the legal and beneficial interests in their land.