Gres0008 law3221 torrenssystemassignment PDF

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Mandatory assignment on Torrens system....

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Name: Pietta Gresham ID: 2134983 Word count: 1537

The Torrens System // Assignment LAWW3221- Real Property PASADENA PROPERTY: Senanka and Nora are the registered proprietors and therefore hold indefeasible title of this property.1 They then sell the property to Jo. The six weeks between Jo signing the contract and asking for the certificate of title raise the issue of postponing conduct. Senanka and Nora were out of the country for those six weeks and would not have had access to the documents, this would be seen as a reasonable explanation for the non-production of the certificate of title and memorandum of transfer.2 Senanka and Nora then sell the property to Robyn.

Equitable v Equitable title As both Jo and Robyn were ‘sold’ the property by the registered proprietors equity is prepared to acknowledge they both have interest in the property, it just needs to be decided who has the better interest.3 If the equitable interests are the same, priority of time gives Jo the better equity.4 However, a failure to lodge a caveat could be seen as postponing conduct and cause Jo to lose priority of time.5 As Robyn’s conduct imputes she had knowledge of Jo’s equitable interest in the property, her interest may not prevail over Jo’s.6 In this case Jo would gain title of the property. But on the facts Robyn soon registers the property in her name.

Equitable v Legal title As Robyn registers the property (in July 2015) this is now a discussion between a legal interest and an equitable interest. Even if the transfer of title was invalid, once the documents are lodged Robyn’s title is indefeasible,7 unless fraud or another exception to indefeasibility can be established.8 Mere knowledge of Jo’s unregistered interest in the property is not in itself want of bone fide or shows the existence of fraud on Robyn’s behalf.9 Robyn instructs 1 Real Property Act 1886 (SA), s69; Frazer v Walker (1967) 1 AC 569. 2 Hewitt v Loosemore (1851) 9 Hare 449. 3 Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315. 4 Rice v Rice (1854) 61 ER 646. 5 Osmanoski v Rose [1974] VR 523. 6 Moffett v Dillon (1999) 2 VR 480. 7 Real Property Act 1886 (SA), s69; Breskvar v Wall (1971) 126 CLR 376. 8 Real Property Act 1886 (SA), s69. 9 Real Property Act 1886 (SA), s72.

Name: Pietta Gresham ID: 2134983 Word count: 1537 Anna to immediately hurry to the LTO to register the property once she realises the possibility that Jo has an interest in the property. This could be considered fraudulent behaviour, Robyn would not be considered a bone fide purchaser and she may not be able to benefit from the registration of the property as the legal owner.10 Robyn’s actual notice of Jo’s interest in the property from their conversation, and her subsequent dealings could prevent Robyn’s second interest in succeeding.11 However Robyn’s actions may not amount to fraud as it is unlikely wilful blindness could be shown as well as personal dishonesty.12Robyn was just acting to protect her interests in the property she had paid for. As it is improbable fraud could be established from the facts, Robyn’s legal interest will hold over Jo’s equitable prior interest. Robyn will gain title of the property.

VICTOR HARBOUR PROPERTY: Senanka and Nora as the registered proprietors lease this property to Francoise and Juliette for three years. On the facts, this agreement appears to fulfil the requirements of a lease being for a fixed amount of time and provide exclusive use.13 However as the lease was not registered, it is not indefeasible under South Australian Law.14 Francoise and Juliette have only an equitable interest in the property.15 Senanka and Nora still have legal interest in the property as registered proprietors at this point.

Legal defeasible interest v equitable defeasible interest Senanka and Nora transfer the property to Isobella, Isobella becomes the registered proprietor of the property.16 As Isobella was given the property by her parents as a present and she did not pay any purchase price for the property, she is counted as a registered volunteer. South Australian Law highlights that registered volunteers do not have indefeasible title to property.17 Isobella appears to have a legal defeasible interest in the property and Francoise and Juliette appear to have an equitable defeasible interest in the Victor Harbour property. Isobella knew the property was leased by her parents prior to gaining title of it, and cannot rely on the protection of a bone fide purchaser.18 From the facts Isobella never made a personal assurance to Juliette and Francoise not to cut short their lease once she gained title of the property. This would have invoked the protection of in personam.19 However fraud may be in issue, as reckless dealing to defeat another’s interests may constitute fraud.20 If Isobella attempts to rent the Victor Harbour property from under the current lease-holders for the use 10 Davidson v O'Halloran [1913] VLR 367. 11 Commonwealth Bank of Australia v Platzer [1997] Qd R 266. 12Grgic v ANZBanking Group Ltd (1994) 33 NSWLR 202; Wicks v Bennett (1921) 30 CLR 80; Waimiha Sawmilling Company Limited v Waione Timber Company NZGazLawRp 32; [1923] NZLR 113. 13 Lace v Chantler [1944] KB 368; Street v Mountford [1985] 2 WLR 877. 14 Real Property Act 1886 (SA), s69(f); Bahr v Nicolay (No 2) (1988) 164 CLR 604. 15Real Property Act 1886 (SA), s67; Barry v Heider (1914) 19 CLR 197. 16 Real Property Act 1886 (SA), s69. 17 Peck v Peck [2010] SASC 258. 18 Pilcher v Rawlins (1872) LR 7 Ch App 259; Smith v Jones [1954] 2 All ER 823. 19 Bahr v Nicolay (No 2) (1988) 164 CLR 604. 20 Russo v Bendigo Bank Ltd (1993) 3 VR 376.

Name: Pietta Gresham ID: 2134983 Word count: 1537 as an air BnB property this could be considered reckless dealing and ultimately fraud. This is unlikely however. Francoise and Juliette could place a caveat on the property to protect their interests, however it will need to be shown that their interests go beyond just a contractual right in the land. A failure to lodge a caveat may be relevant to the deciding of who has a right to the property.21 From the facts Isobella can tell Francois and Juliette that they must leave before the natural expiation of the lease of three years. There does not appear any protections for Francoise and Juliette in place, and Isobella’s legal interest will prevail over their equitable interest in the property. This is subject to any termination clause which may be found in the original lease agreement.

CBD PROPERTY: Bob’s equitable indefeasible interest: Senanka and Nora are the registered proprietors of this property and lease it to Bob. Bob’s lease in the CBD property is for one year and is indefeasible even though Bob did not register it. Leases granted for less than 12 months are indefeasible in South Australia regardless of if they were registered or not.22 Six months into the lease Senanka and Nora sell the property to Melvin. Before Melvin becomes the registered proprietor of the CBD property he made the assurance to Bob that Bob could stay in the property after he bought it. It is important to note personal equities can survive against a registered proprietor in some situations.23 However for in personam to be invoked it will need to be shown that the registered proprietor at the time made the personal assurances, as Melvin made these statements before he owned the property, they cannot be brought home to him. It is unlikely the in personam exception to indefeasibility will protect Bob, unless it can be shown Melvin made the statements after he bought the property too. As the option to renew the lease has been held to be a covenant touching and concerning the land and not personal in nature, it will be indefeasible.24However as this lease was not registered, Bob’s right to renew his lease for a further 12 months will probably not be protected Even though Melvin is the registered proprietor he cannot issues a notice to Bob to vacate the premises as Bob has an equitable indefeasible interest in the property for the 12 months of his lease.25. Melvin will have to wait at least for six months before moving into the property when Bob’s lease has come to its natural expiration.

Dasun’s defeasible equitable interest: 21 Abigail v Lapin - [1934] 51 CLR 58; 22 Real Property Act 1886 (SA), s69(f); s119. 23 Real Property Act 1886 (SA), 71(d); Bahr v Nicolay (No 2) (1988) 164 CLR 604. 24 Mercantile Credits Limited v Shell Co of Australia Limited (1976) 136 CLR 326; McPhee, McPhee Kelshaw Solicitors, FRAUD AND INDEFEASIBILITY OF TITLE (2006), p8. 25 Real Property Act 1886 (SA), s69(h).

Name: Pietta Gresham ID: 2134983 Word count: 1537 As the lease with Dasun is for five years and was not registered, Dasun only has equitable interest and will not have indefeasible protection for his lease.26 It is shown from the facts that Melvin did have knowledge of Dasun’s equitable interest in the property but this in itself is not enough to show fraud.27 If it can be shown that there was a conversation between the original proprietor Senanka and Melvin in which Melvin stated he would observe the interests of Dasun and Bob, and he continues with his actions to evict them from the property this may constitute fraud.28 However from the facts fraud does not appear to be in question. Melvin as the registered proprietor can issue a notice to Dasun to vacate the premises as his legal title will take priority over Dasun’s equitable interest.

UNLEY PROPERTY: The Unley apartment is mortgaged to the Common Law Bank. Senanka and Nora did not arm the bank and subsequently Taylor and James with the power to act as the owner of the property.29 As well as this issue, the property was not registered in Taylor and James’ names before they sold it – they therefore did not have legal title to it.30 Taylor and James did not have the power to transfer the ownership of the property to Mohammed.31 Taylor and James only had an equitable interest in the property, but then gave this up when they tried to transfer the property to Mohammed. As Mohammed would have been a bone fide purchaser he would have gained indefeasible title.32 However at present Mohammed has no interest in the property as long as Senanka and Nora place a caveat on the property before he registers it in his own name. I do not believe deferred indefeasibility applies here as the property has not been registered by Mohammed as a registered proprietor.33 Senanka and Nora have a legal interest in the property still and can lodge a caveat, assuming the form and manner of the paperwork is lodged correctly.34 Senanka and Nora are lodging the caveat as they claimed that the bank did not follow the proper procedure for selling the property according to sections 133 of the Real Property Act 1886 (SA). As Senanka and Nora are still the registered proprietors, they have interest over Taylor, James and Mohammad.35

26 Real Property Act 1886 (SA), s67; Barry v Heider (1914) 19 CLR 197. 27 Real Property Act 1886 (SA), s72. 28 Loke Yew v Port Swettenham Rubber (1913) AC 491. 29 Breskvar v Wall (1971) 126 CLR 376. 30 Real Property Act 1886 (SA), s67. 31Real Property Act 1886 (SA), s67; Breskvar v Wall (1971) 126 CLR 376. 32 Breskvar v Wall (1971) 126 CLR 376. 33 Gibbs v Messer [1891] AC 248; McPhee, McPhee Kelshaw Solicitors, FRAUD AND INDEFEASIBILITY OF TITLE (2006), p7. 34 Real Property Act 1886 (SA), s80(f); s191; Kerabee Park Pty Ltd v Daley (1978) 2 NSWLR 222. 35 Real Property Act 1886 (SA), s69.

Name: Pietta Gresham ID: 2134983 Word count: 1537 BIBLIOGRAPHY A. Legislation  Real Property Act 1886 (SA)

B.                        

Cases Abigail v Lapin - [1934] 51 CLR 58 Bahr v Nicolay (No 2) (1988) 164 CLR 604 Barry v Heider (1914) 19 CLR 197 Breskvar v Wall (1971) 126 CLR 376 Commonwealth Bank of Australia v Platzer [1997] Qd R 266 Davidson v O'Halloran [1913] VLR 367 Gibbs v Messer [1891] AC 248. Grgic v ANZBanking Group Ltd (1994) 33 NSWLR 202 Hewitt v Loosemore (1851) 9 Hare 449. Kerabee Park Pty Ltd v Daley (1978) 2 NSWLR 222 Lace v Chantler [1944] KB 368; Street v Mountford [1985] 2 WLR 877 Loke Yew v Port Swettenham Rubber (1913) AC 491 Mercantile Credits Limited v Shell Co of Australia Limited (1976) 136 CLR 326 Moffett v Dillon (1999) 2 VR 480 Oliver v. Hinton, [1899] 2 Ch. 264 Osmanoski v Rose [1974] VR 523 Peck v Peck [2010] SASC 258 Pilcher v Rawlins (1872) LR 7 Ch App 259 Russo v Bendigo Bank Ltd (1993) 3 VR 376 Rice v Rice (1854) 61 ER 646 Smith v Jones [1954] 2 All ER 823 Tanwar Enterprises Pty Ltd v Cauchi (2003) 217 CLR 315 Waimiha Sawmilling Company Limited v Waione Timber Company NZGazLawRp 32; [1923] NZLR 113 Wicks v Bennett (1921) 30 CLR 80

C. Other: 

McPhee, McPhee Kelshaw Solicitors, (2006), Fraud and indefeasibility of title. Kelshaw Solicitors....