Emily owns the fee simple of 12 Baker Street but this is subject to a legal rentcharge owned by her neighbour. The fact that Emily is entitled to use 12 Baker Street indefinitely indicates that she holds a fee simple. An obligation to make regular payments to a third party, particularly when it continues indefinitely, is known as a rentcharge. Such an obligation is a legal rentcharge if it issues out of a fee simple estate and is expressed to continue perpetually. 

Key Point: Understanding the nature of rentcharges is essential in property law. A rentcharge is a periodic payment that the owner of a property must make to a third party, which can be created in perpetuity or for a fixed term. It can either be legal (if created by deed and issued out of a fee simple) or equitable (in other cases). This concept reflects the complexities involved in the ownership and obligations attached to freehold estates.