Topic 14: Leases

Lessor Lessee Lease Assignment Demise Person who grants the lease: landlord Person who takes interest in the land: tenant A proprietary interest in land Transferring your interest to a third party A lease

A lease describes an interest in land created by the landlord (lessor) granted to the tenant (lessee) for a fixed duration. The landlord holds the land of the Crown and has a reversionary interest in the land: Reversionary interest: when the lease ends, the estate will revert back to the landlord (also known as privity of estate). Most leases are periodic in nature and must have certainty as to: the parties to the lease the property being leased the period of the lease the price to be paid for the lease Caboolture Park Shopping Centre v Edelsten (1987) Where the date of commencement cannot be ascertained from the provisions of the lease, the lease is void Radaich v Smith (1959) 101 CLR 209. A lease also confers the right to exclusive possession of land for a certain period: Tenancies at will arise whenever a person occupies land as a tenant on the basis that either party may terminate the tenancy at any time. It enables either the lessor or the lessee to terminate at will, without the need for prior notice and may be created by express agreement, or by implication. Tenancies at sufferance arise when a lease has expired and the tenant remains on the land without the landlords consent. Where landlord objects to occupant in possession, trespass will arise. This is in contrast to a tenancy at will, which exists when the tenant has the lessors consent. LEASE & LICENSE - The Requirement of Exclusive Possession Right to exclusive possession is conferred with the intention of conferring an interest in land as opposed to a mere personal privilege. A personal right is a license and does not include an exclusive right to possession; you cannot, sue for trespass if you just have a license: License is permission and does not amount to an interest. It is not proprietary. It is not assignable. Radaich v Smith (1959) 101 CLR 209 MATTER OF SUBSTANCE, NOT FORM Mrs Smith was paying 5 pounds, 10 shillings rent. After a year, she applied to Fair Rents Board and achieved a reassessment down to 2 pounds, 13 shillings. Radaich argued that she did not have lease, merely a license; therefore the Board had no power to lower the rent. It was held that:

The substance and effect of the instrument between the parties created a leasehold interest and the relationship of lessor and lessee between the parties. McTiernan: true test of a supposed lease is whether exclusive possession is conferred on the person who purports to be a tenant

Isaac v Hotel de Paris [1960] 1 WLR 239 Isaac managed bar, with liquor license in his name on the premises of the hotel. Paid expenses and kept profits. Paid a sum in consideration of his interest. He argued that he was paying rent, the Hotel argued that he had a personal right. Although Isaac did have exclusive possession and paid consideration, the circumstances indicated that he was never intended to be a tenant: Intention of the hotel was to convey a personal privilege not an interest in land. There must be exclusive possession. There must be evidence of an intention to create a landlord/tenant relationship. Street v Mountford [1985] AC 809 Where there is an exclusive right to possession in consideration of a premium or periodic payment, then that person has a lease.

Brunton v London and Quadrant Housing Trust [2000] 1 AC 406 DO CASE STUDY
PASTORAL LEASES Pastoral leases permit the lessee to use the land solely or primarily for the purpose of maintaining stock; there is no exclusive possession. Wik Peoples v Queensland (1996) 187 CLR 1 Wik Peoples claimed native title to land over which the Queensland government had granted pastoral leases. Claimed that they did not have exclusive possession but rather their rights co-existed with the lessees. Held: the granting of a pastoral lease does not of itself extinguish native title, one must look to the terms of the lease to determine this. Where there is an inconsistency between native title rights and a statutory grant, the rights of native title must yield to that statutory grant. EQUITABLE LEASES Leases which are not created by deed, and do not fall within the oral leases exception (s23D of the Conveyancing Act 1919 (NSW)) will only be enforceable in equity: Walsh v Lonsdale (1882) 21 Ch D 9. Parties entered into an agreement to grant a lease for seven years, stating an intention to enter a formal lease. No lease eventuated. The lessor demanded a years rent in advance (a provision to be contained in the formal lease). The lessee argued there was no formal lease and therefore, unenforceable by law. The Court of Appeal held that the parties had entered into a binding contract to enter into a lease. Section 53 Real Property Act 1900 (NSW) requires a lease over Torrens Title land greater than three years to be registered; where it has not been registered, equity will regard the lease an equitable lease.

COVENANTS Definition: The parties to a lease are subject to the provisions of the lease Covenants by Implication Covenants may be implied into leases for the lessor: Quiet enjoyment: a lessee has a right to occupy and enjoy the leased premises without interference of interruption from the lessor; question of fact in each case: Todburn Pty Ltd v Taormina International Pty Ltd (1990) 5 BPR 11, 173. o Martins Camera Corner PO Limited v Hotel Mayfair Limited (1976) 2 NSWLR 15 damage caused to goods by overflowing water from pipes as a result of poor maintenance on behalf of the lessor. Court held breach of implied covenant. o Kenny v Preen [1963] 1 QB 499 obstructions, and repeated knocking and shouting. o Dowse v Wynyard Holdings Pty Ltd (1962) 79 WN (NSW) 122 the carrying out of structural repairs. o Southwark London Borough Council v Mills [1999] 3 WLR 939 lessee complained about noise levels from other apartments, though they were the result of ordinary and reasonable use of the premises. Argued that there were inadequate noise insulation in the unit; the problem existed when the lessees entered into possession. Held that the noise could amount to interference, though the covenant was not retrospective (only prospective) and did not cover interference arising from already existing factors. Because the disturbance was the result of inherent structural defects in the premises, which existed at the convenience of the lease, and such disturbances were within the contemplation of the parties, there was no breach Not to derogate from grant: a lessor must not do anything inconsistent with the purposes for which the property is leased unless the parties have agreed otherwise. The test used to determine whether the premises have been rendered unfit or materially unfit for the purpose for which they were granted: Gordon v Lidcombe Developments Pty Ltd [1966] 2 NSWR 9. Gordon v Lidcombe Developments Pty Ltd [1966] 2 NSWR 9. The lessor cannot give possession with one hand and take away benefit with the other. Karaggianis v Malltown Pty Ltd (1979) 21 SASR 381 Lessor left lift out of operation for 7 months, interfering with the access to the restaurant of the lessee on the 7th floor. Lessor breached lease. An Implied Duty of good faith: lessor must act in good faith toward the lessee: Alcatel Australia Pty Ltd v Scarcella (1998) 44 NSWLR 349 which referred to Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWIR 234, Hughes Aircraft Systems International v Airservices Australia (1997) 76 FCR 151.

Covenants Implied into Lease

Warren v Keen [1954] 1 QB 15 Tenant should do things like sweep, and avoid behavior that will attract vermin: Tenant must do little jobs about the place, though is not responsible for fair wear and tear repairs from lapse of time. Should do things that would mitigate further damage, such as tell of the tile on the roof. Covenants implied into a lease by statute Section 84 Conveyancing Act 1919 (NSW) requires the lessee to use the premises in a tenant like manner. ALSO permits the abatement of rent, where there has been fire, flood, lightning etc., which render the demised premises unfit for occupation. Proudfoot v Hart [1890] Keep the premises in good and tenantable repair; reasonably fit for the occupation of a reasonably-minded tenant of that class Paradine v Jane (1647) To pay the rent reserved by the lease at the time specified. Destruction of premises did not release the lessee from the contractual obligation to pay rent. S 133A(1) Conveyancing Act Where the lessee has failed to repair, the lessor may commence proceedings against the lessee for damages (not caused by fire, flood etc) for breach. Yield up possession at the end of the tenancy: unless there is some other agreement, the tenant has to go at the end of the lease. If it is a lease of agricultural land had to cultivate the farm in a husband like manner.

PRIVITY OF ESTATE AND ASSIGNMENT (Sub-Leasing) Assignment is the transfer of the whole interest of the lease and occurs when a tenant reassigns their lease. The tenant (lessee) becomes the assignor and the person taking assignment becomes the assignee: Privity between lessor and assignee where the lessee assigns the lease and the assignee breaches the covenant to pay rent, the lessor can sue the lessee for the arrears: 195 Crown Street Pty Ltd v Hoare [1969] 1 NSWR 193. Privity between assignee and lessee where the lessor assigns the reversion and the assignee of the reversion breaches a lessors covenant in the lease, the lessee can sue the original lessor for the breach, by reason of their contractual relationship.

The effect of the assignment is that: The assignee obtains all the benefits under the lease, such as the benefit of enjoying exclusive possession; but The assignee is also required to fulfill all obligations under the lease, such as payment of rent Subleasing occurs when a lesser part of real estate is re-leased; someone takes over the whole of your lease for a short period. This may be all of the premises for part of the time, or part of the premises for all of the time. The sub-lessor is the tenant who re-leases to the sub-lessee. Privity of estate allows parties to sue regarding land issues. Privity of contract allows parties to sue regarding contractual issues.

Covenants Against/Prohibiting Assignment: The law allows in circumstances for landlords to put covenants against assignments and subletting. o Covenant can be absolute (completely forbids) or covenant can be qualified, allowing sublets or assignments with landlords consent. o If a lease is silent, lessee may assign or sub-lease without obtaining consent of the lessor: American Dairy Queen Pty Ltd v Blue Rio Pty Ltd (1981) 147 CLR 677 o Lessor may consent even if contract prohibits: ss120 and 123 of Conveyancing Act 1919 (NSW). Qualified covenants: qualified covenant is more common in practice. s132B of the Conveyancing Act specifies that with a qualified covenant, then the landlord shall not unreasonably withhold consent; also, cannot demand a premium for consent. IE Circumstances in which a lessee will be permitted to assign or sub-lease o Landlord may go around the provision, but cannot contract out, by a method known as the Creer v P&O exception, or surrender clause. o Creer v P&O Lines of Australia Pty Ltd (1971) 125 CLR 84 include a surrender clause: in the event of the tenant wanting to assign, then the tenant must first offer to surrender the lease altogether. Unreasonably withholding consent: Reasonableness of the refusal is to be judged by reference to the person of the proposed sub-tenancy or assignment or by reference to the effect on the use and occupation of premises. Cannot refuse permission as to what might happen to another premises: Re Gibbs and Houlder Bros [1925] Ch 198. o International Drilling v Louisville [1986] 1 Ch 513 lists factors in determining unreasonableness (PAGE 237) Where tenant assigns/sublets without permission: o Barrow v Isaacs and Son [1891] 1 QB 417 - covenants will be broken if the tenant assigns or sublets without the landlords permission. It is no defence to say that the landlord would have consented. Must still seek consent even where it cannot be reasonably withheld. o Wilson v Fynn [1948] 2 All ER 40 - landlord must be given reasonable time to consider whether he or she will consent. Lessee must supply relevant documentation on request. Landlord is not obliged to give reasons for refusal, but a failure to give reasons may allow the inference that the refusal was unreasonable: Frederick Berry & Son v Royal Bank of Scotland.

What are the remedies available to a tenant if a landlord refuses consent? Can go ahead and sublet anyways, anticipating that if the tenant is taken to court, then the court will necessarily find that the refusal was unreasonable: Unique in the sense that the tenant cannot assume that it would be allowed, but can assume where unreasonable. Seek a declaration from the court that the refusal was unreasonable in the court of equity. What can landlord do if tenant sublets anyway? Landlord can always get injunction to stop sublet that is not allowed: The landlord in support of refusal, is allowed to adduce evidence, not just that which influenced decision, but information subsequent to refusal. TERMINATION Section 129 Conveyancing Act 1919 (NSW)

Where a tenant breaches a term in the lease, the landlord may not re-enter the premises without first giving the lessee a notice which specifies the particular breach complained of and which requires the lessee within a reasonable to remedy the asserted breach; it is not immediately assumed that the lease is no longer on foot. Depends upon: 1. The type of breach, and 2. What intention the tenant evinces with regard to their ongoing responsibilities under the lease

ESSENTIAL VS NON-ESSENTIAL TERMS This distinction is based on the construction of the lease as a whole: Shevill v Builders Licensing Board (1982) 149 CLR 620: A covenant for payment of rent does not usually amount to an essential term: Laurinda Pty Ltd v Capalaba Park Shopping Centre Pty Ltd (1989) 63 ALJR 372. However, where the lessees conduct is perceived to be a rejection of obligations under the lease, the court may find the lessee has repudiated the lease: Wood Factory Pty Ltd v Kiritos Pty Ltd [1985] 2 NSWLR 105 in which the lessee was held not to be bound by the lease as it: o Permitted an employee to reside on premises, o Allowed the premises to fall into disrepair, o Was behind in rental payments, o Attempted to sub-lease premises. Repudiation is found in actions, rather than in the words of the tenant. A large number of non-essential terms may be sufficient to amount to repudiation or intention not to be bound: Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17: Tenant had several breaches and made little or no attempt to rectify them: o Had sub-let the premises in breach of a covenant, o Caused damage to the roof and draining, o Obstructed access, o Failed to open premises on time, o Did not pay rent and failed to repair things that it was their responsibility to do so. The High Court looked at their overall behaviour, and found that the tenant had fundamentally breached (Wilson and Deane JJ) and repudiated (Brennan J) the lease because the tenant evinced intention not to be bound (Dawson J and Mason J agreed that the conduct amounted to both a repudiation and fundamental breach).

Where there are essential terms, and it is felt that the breaches amount to a repudiation by the tenant, the landlord has three options. 1. Waive the breach: Matthews v Smallwood [1910] 1 Ch 777. Landlord is said to waive a breach where three things are evident: a. The landlord knows of and understands the breach. b. The breach must make the lease liable to forfeiture. c. There must be some unequivocal act by the land lord to either waive the breach or to elect not to end the lease. i. The unequivocal act may be oral, express or implied.

2. Forfeit the lease and re-enter the premises: Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17. 3. Accept the repudiation, terminate and re-enter: Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17. What damages is a landlord entitled to? Example timeline: Jan 06, Lease commences. Jan 07, Tenant commences breaches/shows intention not to be bound. Oct 07, Landlord re-enters the premises. Jan 08, New tenants move in. Jan 09, End of lease. If the tenant repudiates by intention not to be bound, the landlord is entitled to damages up until the end of the lease (Jan 07 Jan 09 as per the above example), according to the contractual terms, including: Damages for cleaning, advertising for new tenant, If the second tenant pays less rent, liable for the different for the life of the lease. o Subject of course to the landlords duty to mitigate damages. If the tenant does not repudiate, and maintains an intention to be bound, the landlord is entitled to damages up until re-entry (Jan 07 to Oct 07 as per the above example): Shevill v Builders Licensing Board (1982) 149 CLR 620: The tenant was aware of the fact that she owed rent. o Was clearly making an effort to minimize rent owed in arrears, paid more than rent wherever she could; she knew her obligations as a tenant. o The landlord re-enters; although the landlord was entitled to do so, the tenant was not liable for damages for any continuing costs. High Court held that the covenant to pay rent is a non-essential term of the lease. This tenant had evinced a clear intention to be bound by the terms of the lease. o She was held liable to the rent owed up until the landlord re-entered.

Forfeiture of the lease: landlord accepts that things are going badly, and either physically reenters the premises or by gets an order by the Supreme Court. Is an equitable remedy, will not give equity where the party is in the wrong. Tenant may ask a court of equity for relief against forfeiture. This will be available where a tenant believes they were wrongfully shut out of a premises and ultimately reinstates the lease. Tenant must pay any outstanding rents and an estimate of the landlords costs and give an undertaking that they will not make this mistake again. Courts will need to be satisfied that the lessee will be able to fulfil its obligations in the future: Hayes v Gumbola (1988) NSW ConvR 55-375.

70317 Easements Definition: An easement is an interest in land. It is a right, of definite and limited character, annexed to the enjoyment of a corporeal hereditament (dominant tenement - DT) by reason whereof the occupier of another corporeal hereditament (servient tenement - ST) is bound to permit the person in whom the right is for the time being vested to do something on, in or over the servient tenement, or whereby the owner or occupier of the servient tenement is bound to abstain from exercising one or more ordinary rights of ownership or occupation, or to do something, for the benefit of the occupier of the dominant tenement. - A right enjoyed by one person over the land of another a privilege without profit An easement is subject to the person as an individual rather than to his property. An easement is usually a legal right it is a right in rem, and not a right in personam. An easement is enforceable by the owner of the DT from time to time, against the owner of the ST from time to time:

Where A owned Blackacre and grants a right for B to use a path across Blackacre to the owner for the time being of the neighbouring property, Whiteacre. Blackacre is the ST. Whiteace is the DT.

Ives Investment Limited v High [1967] Easements can exist in equity rather than at law; for example, where there is an imperfect grant or an agreement to grant an easement, the courts may find there to be an equitable easement. Or where specific performance would be ordered to complete it in equity. However, an equitable interest would be defeated by a bona fide purchaser of the legal estate who takes over the estate for value and without notice of the easement.
Clos Farming Estates Pty Ltd v Easton (2002)

In this case the plaintiff sought financial relief for the servicing of farming land (a vineyard) from the profits of future crops. The defendants however claimed that an easement for vineyard and the conditions attached to it where not consistent with that which easements are intended and therefore the easement is invalid along with any right to compensation. CHARACTERISTICS OF EASEMENTS Re Ellenborough Park [1956] outlined four characteristics of an easement: 1. There must be a DT and ST annexed; that is, capable of providing some benefit. 2. Easement must accommodate the DT. 3. DT and ST must not be owned and occupied by the same person. 4. Easement must be capable of forming the subject matter of a grant. 1. ANNEXATION There must be: a) Dominant the block that has the right b) Servient the block that serves, that is subject to the easement If the benefit is not annexed, there is only a mere personal right that binds the parties; does not run with the land and does not bind successive owners.

Bailey v Stephens (1862) There must be a nexus between the easement and the land benefited. Section 88A(1) Conveyancing Act 1919 (NSW) allows the crown to create easements in gross; that is, easements not annexed to any dominant tenement: e.g. sewage pipes under the land. 2. ACCOMODATION The easement must accommodate, be for the benefit of, the dominant tenement (Bailey v Stephens (1862). Enhancing value of a tenement is not sufficient; the easement must accommodate the dominant tenement. The easement must be connected to the use and enjoyment of the dominant tenement (the land), not merely for the owner as an individual: Hill v Tupper (1863) 159 ER 51 Plaintiff was the owner land next to a canal, a lease gave him rights to use the canal. The defendant ran a pleasure boat business on the canal. The plaintiff argued this interfered with his right to use the canal: Court held that plaintiffs right to use the canal was not an easement because it benefitted only him, and not the tenement itself. Further, the right created was not the subject matter of a grant. Todrick v Western National Omnibus Co Ltd [1934] DTs and STs need not physically adjoin, but must be sufficiently close that a real benefit accrues to the dominant tenement. Re Ellenborough Park [1956] Ch 131 Owners of various parcels of land were given the enjoyment of Ellenborough Park, subject to the payment of a fair and just proportion of the expenses keeping the park in good order and condition: The English Court of Appeal held that there could be a creation of an easement, which is subject to an obligation to spend money on the part of the owner of the DT. If there is an obligation attached to easement, successors to the property are bound to perform them. Frater v Finlay (1968) 91 WN (NSW) 730 An easement existed to pump water from a neighbours well. In accordance with the easement, the owner of the DT was required to maintain the pumping equipment, and so were his successors: Successors in title to a grantor (DT) of an easement are bound to perform this obligation. Successors in title to a grantee (ST) will have a remedy against the grantor or his/her successors in title if the covenant is not performed. The grantor of an easement can attach to and make part of the grant a term or condition that the grantee shall contribute to the cost of repairs. 3. UNITY OF OWNERSHIP & OCCUPATION Metropolitan Railway Co v Fowler [1892] Dominant and servient tenements must not be both owned and occupied by the same person: if one party owns and possesses both, the easement is lost (with respect to Old System Title land. I.e. you cannot have an easement over your own land.

There are statutory exceptions to this rule: Section 88B(3)(c) Conveyancing Act 1919 (NSW): where a developer submits plan to the registrar general, the registrar general will allow the same person to own both the dominant and servient tenement at the same time; where s88B instrument used. Section 47(7) Real Property Act 1900 (NSW): an easement recorded on register is not extinguished when one party owns and possesses both dominant and servient tenements.

4. SUBJECT MATTER OF GRANT The easement must be capable of forming the subject matter of a grant; right granted must be capable of being granted as an easement. There exists a point at which the court wont allow the right to be created as an easement: Hill v Tupper (1863) 159 ER 51. Concerned the rights to put pleasure boats on a lake (which was recorded as an easement). Where the easement is founded on a personal interest, or pre-existing property right. Where the easement arises out of exclusive possession: Copeland v Greenhalf [1952] 1 Ch 488: strip of land, DT claiming easement to park and repair vehicles. Not an easement: cant be exclusive use/possession ie if use part of Bs land is exclusive to A, is not easement (easement: A can still use land, is just subject to Bs use). Bursill Enterprises v Berger Bros (1971) 124 CLR 73: where A is given unrestricted right to column of airspace between buildings to exclusion of B. Not trespass: transfer of proprietary rights as exclusive use/possession means no easement will exist. Positive/Negative Easements An easement may be either: Positive: owner of the DT is allowed to do something upon the land comprising the ST, such as using a right of way; or Negative: where the owner of the ST is restrained from putting their land to a use otherwise allowed by the law in the interests of the owner of the DT, such as is the position with an easement of light or air. Examples of Easements: Rights of way (Drewell v Towler) All rights required to enable the grantee to get water from the grantor (Re Simeon) Right to water from a spring, and the right to go onto neighboring land to collect it (Race v Ward) Right to get water from a pump (Polden v Bastard) Right to discharge rainwater (gutters) (Harvey v Walters) Right to commit private nuisance by: o Creating noise (Elliotson v Feetham) o Polluting water (Baxendale v McMurray) o Polluting air with smoke/scents (Crump v Lambert) Right to use area alongside a wharf for loading/unloading vessels (Thomas W Ward Limited v Alexander Bruce (Grays) Limited) Right of support of buildings:

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From land (Dalton v Angus) From other buildings (Lemaitre v Davis)

Contrasting easements with:

Restrictive covenants are covenants, which restrict the use of land in a particular way for the benefit of neighboring land. They are are equitable interests in land and negative in nature. In equity, they have been treated as quasi-easements. Profits a pendre which is a right to take something off another persons land. Licence which is a revocable contractual right and not an interest in land. For example if the ST grants a right to a non-property holder: Ackroyd v Smith Public rights over land which are rights over public land enjoyed by the general public and not specific individuals e.g. roads public beaches etc. Natural rights are enjoyed at law irrespective of any grants, such as a right to water where property is annexed to a river or stream.

Concept of an omitted easement; you can only create an easement under Torrens in writing and it should be registered. If an easement is created comes under Old System, it could either be created as an easement in writing, by implication or by prescription (Section 42(1)(a)(1) Real Property Act). CREATION OF EASEMENTS An easement may be created for any duration (e.g. fee simple, for life, term of years etc) An easement may be created by: 1. 2. 3. 4. Express grant. Statute. Implied grant (Old System Title only). Prescription (Old System Title only).

RPA, s 42 (1)(a1) - allows the enforceability of an easement under TT land that had been created by implication or prescription under OST CA, s 88K - court can create an easement 1. EXPRESS GRANT

If the instrument (created 1931 or later) expressly creates an easement, it must comply with CA s 88(1) (a) land benefited (b) land burdened (c) the person whos consent is required to modify the easement.
Section 88(1) Conveyancing Act 1919 (NSW): where an instrument which came into effect after 1 January 1931 expressly creates an easement, it will only be enforceable if it complies with s88(1). Old System Title Section 23B Conveyancing Act 1919 (NSW): The express grant must be in writing, must be created by deed, and must stipulate who is the DT and who is the ST. Torrens Title Section 46 Real Property Act 1900 (NSW): An express grant must be in approved form and registered in order to be effective.

Section 47(1) Real Property Act 1900 (NSW): The details are to be recorded in the folio

for both the dominant and servient tenements

Section 88(1) Conveyancing Act 1919 (NSW): where an instrument which came into effect after 1 January 1931 expressly creates an easement, it will only be enforceable if it complies with s88(1). Express Reservation: An express reservation occurs whereby, in a conveyance, an owner reserves an easement for the benefit of the land retained by the owner (St Edmundsbury and Ipswich Diocesan Board of Finance v Clark (No 2)). Old System Title o A separate re-grant need not be conveyed (CA s 45A) Torrens Title Land o The reservation is made in the memorandum of transfer by which the land is transferred. o It must comply with CA s 88(1)

Dabbs v Seaman (1925) 36 CLR 358 A owned both blocks of land; transferred one block and with the transfer A had a plan which showed a strip of land as a lane which A keeps ownership of. The CT/Folio of Register was paper type and it reproduced the plan including the strip of land marked as a lane. CT of the respondents TT land referred to a 20 foot lane. No mention in either transfer CT of any easement: High Court held that appellant entitled to use the 20 foot lane as a right of way. 2. STATUTE Statutory easements may be created under the following: Public Works Act s 4A An easement may be resumed by the crown over private land Crown Lands Consolidation Act s 279 Every purchaser of crown land shall be entitled to road access, and has an easement to the neared road through/over any crown land Conveyancing Act s 88B Easements can be creation by registration or recording (under CA s 196) of a plan setting out the details of easements created for the benefit of: - Any public roads - Easements in gross under CA s 88A - Easements belonging to/burdening land in the plan Section 88K Conveyancing Act 1919 (NSW): easements can be created by the court if: - Use of the land benefited will be consistent with the public interest. - The person who is giving the easement has to be adequately compensated. - Reasonable attempts and offers of compensation must be given. The applicant must have made all reasonable efforts to negotiate with the owner of land to be burdened. When viewed objectively, the applicants negotiations for an easement have proved fruitless and it is unlikely that further negotiations will produce a consensus: Coles Myer v Dymocks (1996) BPR 97-585. If it is reasonably necessary for the effective use or development of other land that will have the benefit of the easement.

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Coles Myer v Dymocks (1996) BPR 97-585: Whether or not the creation of an easement is reasonably necessary is a question of fact to be determined by the court. Tregoyd Gardens v Jervis (1997) 8 BPR 97-688: There is no requirement that the easement be absolutely necessary for the use or development, nor that the proposed use or development be the only reasonable use of the land to be benefited; thus the requirement may be satisfied even when the applicants land could be effectively used or developed without the easement.

The second is that the easement is reasonably necessary for a use or development that is reasonable compared with possible alternative uses/developments (117 York Street v Proprietors Strata Plan).

Sections 88A, 88B Conveyancing Act 1919 (NSW) allow the Crown to create an easement in gross favour of prescribed authority (waterboards, local council instrumentalities etc). 3. IMPLIED EASEMENTS Old System Title only Easements may be implied by operation of law, from the circumstances/necessity or from a common intention; such easements are not contained in any instrument and as such, do not have to comply with s88(1). This usually arises where land which was formerly in common ownership is subsequently severed by the common owner who conveyed part of the land and retained the residue, or conveyed parts simultaneously to different owners. An easement arising by implication: Is not created by way of an instrument Is a legal interest Cannot be defeated by a subsequent purchaser of the servient tenement Easements by implication are not created for all purposes, but, rather, for the limited purpose of allowing enjoyment of the land as it is at the time (e.g. if the land is agricultural, the easement could not be relied upon if the land is turned into an industrial estate). Where the vendor has failed to grant to either himself, or the servient tenement, an easement: The vendor will only imply what is necessary for use of the land. The purchaser will get all that is needed to enjoy the benefits of the land that the vendor had when he occupied that land. Corporation of London v Riggs (1880) 13 Ch D 798. Where an easement is created by implication on behalf of a vendor, it is restricted to the limited purpose for which it was created. Wheeldon v Burrows (1879) 12 Ch D 31. An easement will not implied in favour of a vendor, because they are in a position to reserve expressly their rights. Vendor had two blocks; one vacant and one with a warehouse. The vendor sold the vacant one first, then the warehouse within a month. The vendor failed to reserve for himself an easement for access to light in the warehouse. The purchaser of the vacant block builds up in such a way that prevents light. It was held that the vendor must reserve for himself expressly the rights that they want for the land: o Where they have not, the law will not imply except: Where there are mutual or reciprocal easements. Easements of necessity to make use of the land North Sydney Printing v Sabemo [1971]

An easement cannot be implied where the ST was Torrens Title at the creation of the easement. Omitted Easements Section 42(1)(a)(1) Real Property Act 1900 (NSW): if an easement created by implication when ST under OST, then ST becomes TT, the easement will remain enforceable: omitted easements are an exception to the indefeasibility of TT: Even if there is nothing in schedule 2 of the CT burdening the ST, an easement can be enforced if it was created when the ST was OST. Cant create easement by implication over a ST which is TT land at the time of creation of the easement. James v Stevenson [1893] AC 162 and James v R-G (1967) 69 SR (NSW) 361, reaffirmed by NSW Court of Appeal in Beck v Auerbach (1986) 6 NSWLR 454, Dobbie v Davidson (1991) 23 NSWLR 625, Australian Hi-Fi v Gehl [1979] 2 NSWLR 618. 4. EASEMENTS BY PRESCRIPTION Old System Title only Use for a long time raises implication of an easement i.e. continuous use for 20 years at least. The use must be for a substantial period of time and the use must be: Not by force Not by permission Not by secrecy If any of the above 3 are present then theres no easement created Delohery v Permanent Trustee (1904) 1 CLR 283 Easement allowed for light, where someone had access to light for greater than 20 years. Legislation overturned the existence of easement for light. An easement by prescription requires that the owner of the ST had: Knowledge of the acts done, Power to stop the acts or sue in respect of them, And a failure to exercise such a power. Section 42(1)(a)(1) Real Property Act 1900 (NSW): if an easement created by prescription when ST under OST, then ST becomes TT, the easement will remain enforceable: An easement by prescription cannot be created over a ST which is TT at the time of creation of the easement by prescription. EXTENT OF USER (CHANGING THE USER OF AN EASEMENT) The extent to which an easement may be used depends on how the easement was created: 1. Express grant, 2. Implication, 3. Presecription. 1. EXPRESS GRANT The change of use depends on construction of the deed that has created it. The courts will consider: Physical nature of the site of the easement. Dominant tenement at the date of the reservation or grant does not inflict with the enjoyment of the use of the servient tenement.

Where there is a grant for all purposes, court will allow change of use. White v Grand Hotel, Eastbourne [1913] 1 Ch 113 Could the party rely on continued use of the easement, when they previously had rights as a home when they want to change to a Hotel Court allowed this: the easement was express, and unless there is some limitation to be found in the grant (the physicality of the easement etc) court will not cut down the generality of the easement. Physical nature might indicate the intended purpose of the easement. Toddrick v Western National Omnibus Company [1943] 1 Ch 113 Wanted to change easement to include the passage of buses by building a ramp over the easement. The easement was only 3cm wider than the width of the bus. It was held that where the intended use is not spelled out, the physical nature of the location might indicate the intention of the parties at the time Ramp restricted people from getting in and out of their own land and was an excessive use with regards to the right of way granted by the easement. No one who is entitled to use a right of way may use it to an extent which is beyond anything in contemplation at the time of the grant. Jelbert v Davis [1968] 1 WLR 589 The grant was at all times and for all purposes. The easement in question had previously served a farm. Jelbert wanted it to be changed to serve as a camping ground; changed with regard to the type of vehicle, and volume. The court held that no one who is entitled to use a right of way may use it to an extent which is beyond anything in contemplation at the time of the grant. Even a very broadly drafted grant cannot be used so as to interfere with the rights of others: 200 camp sites, each with an average of 3 people coming and going is excessive use, beyond anything contemplated at the time of the grant. o Because it is a right in common with others, therefore was interfering. The grant has ancilliary rights that allows for full use by the dominant tenement. Bulstrode v Lambert [1953] 1 WLR 1064 Easement was given in favour of auctioneers to a shed, who were given right to load and unload furniture to the shed. In order to do this, the movers had to park trucks in the defendants yard; defendant asserted this comprised unacceptable interference with their rights in their own yard. Court held that the defendant could assert those rights; they were a necessary incident to the dominant tenements right to the easement. VT Engineering Ltd v Richard Barland & Co Ltd (1968) 19 P&CR 890 Landlord who had granted tenant a right of way at all times and for all purposes over his land for access to his property was restrained from erecting a new building with a passageway giving access. The court held this would severely curtail the tenants previously unrestricted rights. 2. IMPLICATION It is not possible to extend the use of an easement by implication: Corporation of London v Riggs (1880) Land locked land was to be used by vendor for agricultural purposes; created a right of way for them. The vendor, dominant tenement, subsequently changed his farm afterwards to a tea room.

Court restricted the use of the easement; the easement only applies to the purpose granted by court; cannot change use of an implied right as court granted easement out of equity.

Lock v Abercaster [1939] Can change mode/means of use; cant change the use, but can change the vehicle (eg horse and cart may be changed to car by implication). 3. PRESCRIPTION The use of a right of way by prescription cannot be changed or extended. What if they want to do the same thing, more intensively? Will not amount to a prescription provided there is no substantial increase in the burden imposed on the ST; described as an intensification British Railways Board v Glass [1965] A mere intensification of use of the land is not regarded as a change of use, provided that there is no increase in the burden on the servient tenement Cannot have a change of purpose under prescription, only intensification. RPC Holdings v Rogers [1953] 1 All ER 1029 Agricultural holding, wanted to change the purpose of the easement to benefit a caravan park over a golf course. Court said easement could not be converted for new use due in part to the greatly increased traffic and use; cannot have a change, just an intensification. GENERAL COMMENTS REGARDING EASEMENTS The current owner of A can enforce easement on the current owner of B: Because there is an interest in land, if you have the benefit of an easement, you can enforce the contract. Selby v Nettlefold (1873) 9 Ch App 111: if an obstruction across right of way, owner of DT can deviate around it by most convenient route if it cant physically move it. Saint v Jenner [1973] 1 Ch 275: if ST willfully obstructs (e.g. padlock) theyre liable in damages; court may order injunction. Newcomen v Coulsen (1877) 5 Ch D 133: Obligation on DT to keep right of way in good repair, but ST cant make DT keep it in good repair; ST cant stop DT from coming onto ST to keep it in good repair. EXTINGUISHMENT OR MODIFICATION OF EASEMENTS Easements may be extinguished by: 1. 2. 3. 4. Express release, Implied release, By operation of law; or By order of the court

1. EXPRESS RELEASE If the easement was created a long time ago, and has not been used, it must be expressly released: Must create another deed to be valid in law. Must be in writing for equity.

Can be extinguished by: Under OST, a release must be by deed (CA s 23B(1)). Under TT, a release requires a registered transfer (RPA s 47(6)). Under equity, an easement is released by writing for value (CA s 23C(1)(c)). Abandonment under Torrens Title If the easement has not been used for 20 years (RPA s 49(2)), the Registrar General may cancel the recording of the easement in the register (RPA s 39(1)). Before cancelling, the Registrar-General must consider submissions made by an interested party during a notice period (RPA s 49(4)). The Registrar General may also cancel the easement if the easement has no practical purpose because separate properties have been consolidated into one property (RPA s 49(5)).

2. IMPLIED RELEASE An easement may be abandoned, regardless of how it was created: The abandonment is an active process not passive; as such, mere non-user does not constitute abandonment: Ward v Ward (1857) 155 ER 1189. In order to demonstrate abandonment, ST must show that the owner of the DT intended to release the ST. Must show: o Non-use and o Surrounding circumstances indicating intention to release. There must be an active act that implies a release will not be sufficient that it is not used for a period because of the existence of a lesser right elsewhere. Treweeke v 36 Wolsely Rd (1973) 128 CLR 274 Next door had a right of way to get to the beach. DT found easier access to the beach. The easement became impassable over time, had sheer rock faces and impenetrable bamboo, the owner/DT had cooperated to build a fence and part of it was covered by a swimming pool and had not been used in 45 years: The High Court held that the right of way had not been abandoned, as non-use over time does not equal abandonment. The DT might not have let those things happen had they not found the other path that was a mere personal right. If the other personal right disappears, they might reassert right over the easement; decision has to be taken as to the inferences to be drawn from the whole of the relevant evidence. Strata Plan Case [1979] 2 NSWLR 605 Can abandon some of rights associated with an easement without abandoning all of them. Section 49(2) Real Property Act 1900 (NSW): Registrar-General may treat easement as abandoned if it has not been used for more than 20 years: If the R-G comes to that finding, has power to cancel the easement. 3. OPERATION OF LAW Under Old System, when the DT and ST come under the same occupation and ownership, then the easement disappears (Coke Upon Littleton) Does not apply to TT; allows for the survival of easement per s47(7). Does not apply to easements created over both RPA and Old System per s88B. 4. ORDER OF THE COURT

Section 89 Conveyancing Act 1919 (NSW): empowers the court to modify or extinguish an easement if the court is satisfied of one of: That the easement should be deemed obsolete: might be due to a change in use or character of neighbourhood. Where the extinguishment has been agreed to by the owner of the DT. Can extinguish even if its been agreed to by a previous owner and not recorded on the register. Application of s89 is discretionary. Pieper v Edwards [1982] Extinguish agreed to by the previous owner of the benefited land; even though the extinguishment was left unregistered on TT, the courts allowed abandonment by that means. Undermines s47(6) RPA allowing changes of title by registration. Court may consider history of the land, actions of both tenements and prior registered proprietors. Concern arises in that a purchaser can purchase land with easement registered, then later find that a previous proprietor extinguished the easement. REMEDIES IN RESPECT OF EASEMENTS Remedies available for an interference with an easement are: Abatement: removal of obstruction to the easement by the owner of DT. Injunction: against the continuance of the interference with the easement. Damages: where substantial interference with the enjoyment of the easement. Nuisance: Where ST is blocking right of way, requiring damage.

TENURES and ESTATES

 2 basic doctrines of property law o Doctrine of tenures o Doctrine of estates Doctrine of Tenures All land is owned by the crown no-one owns their land, it is held of the crown The crown grants their subjects the right to hold (but not own the land) o Doctrine of tenures explains the terms upon which the land is held Possible exception of native title claims Relevant aspect: Law of escheats o In Australia, that land will only revert to the crown if you die and do not leave your property to anyone in your will Doctrine of estates Sets up three sorts of interest in land o Fee simple (FS) - Most extensive, most absolute o Life estate (LE) o Fee tail (FT) - Now obsolete Fee simple o o o Freehold interest in land An interest in land which lasts as long as the owner, and is survived by their heirs Heirs wider concept than just lineal descendants Simple meaning unrestricted Most common form of estate since the Tenures Abolition Act 1660 Sometimes reference to someone being seised of the land in fee simple Means they have the right to remain in peaceful possession of the land

Essential features: Owner (tenant in fee simple) has the power to dispose of the land during their life or by their will Owner can transfer the property to collateral heirs To create an estate in fee simple - conveyances Section 47 Conveyancing Act o Only relevant to conveyance inter vivos (between living people) Presumption that fee simple passes as long as conveyor had an interest in fee simple to pass o Ie it is enough to conveyance to A or A in fee simple o Wills Act NSW - Presumed that fee simple passes in will Onus of proving otherwise lies on person who wishes to prove so To leave life estate only, must be explicit Person with estate in fee simple may convey some of the estate away Possession is respected

 The law recognises the person who has possession of the land Protects them from anyone but the true owner If wrongful possessor hold onto possession for 12 years they will acquire the owners rights Reversion If A, is seised of land in fee simple, and grants a life estate to B As interest is called a reversion o May be sold or passed onto heirs Remainder If A sells reversion to X o Xs estate cannot be classed as a reversion, as X has never been sesed (in possession) of land, and so subinfeudation is not possible o This is because reversion implies tenure Xs interest is called a remainder interest o Upon Bs death, the land remains away from A instead of reverting to A Contingent Remainder o o o o Where an interest in land will vest itself only upon the occurrence of some contingency Eg person turning 21 If person dies at 20 If life tenant alive, back to life tenant If live tenant not alive, back to grantor If grantor not alive, to estate of grantor (or government if no estate)

Determinable fee simple Fee simple that will automatically come to an end on the occurrence of a specified event that may or may not occur o Eg For as long as the land continues to be used for school purposes o If the event occurs, the land reverts to the grantor o If the event becomes impossible, the possibility of reverter to the grantor is destroyed, and the fee simple becomes absolute Defeasible Fee Simple Fee simple granted in absolute terms, but qualified by super added condition of defeasance Similar to above, but grantor has the choice to decide whether or not to reclaim the right of entry not automatic Life Estate o o o An interest for as long as you live, but which cannot be passed on Eg husband might leave wife estate that will pass when she dies Cannot sell the property Can have life estate for duration of someone elses life 2 types ordinary life estate estate pur autre vie

Ordinary life estate

o o o o o o

Estate for the life of the grantee (most common) Formerly used as a lease before leases received full protection of the law Now used mainly in Australia in retirement villages and in wills To leave a life estate The presumption is now that it is a fee simple unless otherwise indicated Between living people (inter vivos) - Must be established with words eg to A for life) o In a will - Must be expressly indicated Formerly, burden of proof to prove fee simple, now, burden of proof to prove life estate Estate pur autre vie o o Eg To B for the life of A B is the tenant of life estate pur autre vie A is the cestui que vie Ie cestui que vie: Person whose life governs the length of the estate No beneficial interest in the land, only a unit of measure

May arise in 2 ways o Created by express grant o Created where the holder of an existing life estate conveys to another person If B dies before A o Bs Heirs could occupy until As death - S5 Wills and Probate Administration Act 1898 (NSW) allows testator to dispose of all his personal estate Legal and equitable life estates: o o o Legal life estate Life tenant has automatic right to possession (usual case) Equitable life estate No automatic right to possession, although equity courts will usually afford that right Legal ownership of property in someone else - eg where land conveyed to trustees upon trust for A for life, with remainder going to B in fee simple o Where trustees have no active duties to manage the property - Equitable life tenant entitled to possession Turner v Noyes Brown v How o Where trusties have duties to perform - Equitable life tenant not entitled to possession as of right, unless the instrument creating the life interest confers that right expressly or by implication Powrys v Blagrave - Equitable Life tenant may apply to court for order granting possession and right to manage the property Court decides whether allowing tenant into possession is the best way of dealing with the property in the interests of all o Re Earl of Stamford and Warrington Remainder men People to whom the property passes when the life tenant dies Rights of life tenant

 Right to income from the property o Includes income from farm - Re Burn (1918) o Includes royalties from mine - Re Kemeys-Tynte [1892] Can sell life estate, but very uncommon Emblements Legal representatives of deceased life tenant have right to enter land after the life estate has come to an end, an reap the crops that the life tenant has sown o Only applies to crops - Graves v Weld o Applies only where life estate has come to an end without the life tenants fault - Olands Case o Does not apply if life tenant goes bankrupt when life estate given to A until bankruptcy - Official Trustee v Westpac o Applies only to crops planted by the life tenant, not to those by remainderman or reversioner - Grantham v Hawley Obligations of life tenant: The law of Waste Life tenant not allowed to use property in a manner detrimental to those who eventually inherit Waste o Any act which affects the value or character of the property Permissive waste Life tenant not responsible for normal deterioration of property unless express clause in will o Re Cartwright (1880) Voluntary waste Life tenant is responsible for deliberate acts of damage to the property Unimpeachable of waste o Those protected by exemption clauses for voluntary waste Can get equitable relief despite status as unimpeachable of waste Vane v Lord Barnard(1716) o FACTS - Life tenant unimpeachable of waste in possession of caste - Had fallout with remainder man, and strips castle bare Equitable waste Unconscionable acts of wanton destruction Not punished by common law, but courts of equity would restrain or punish Life tenant could not cut down trees, as this would be a wanton act of destruction Turner v Wright (1860) o FACTS - Life tenant in possession of grand manor house surrounded by trees

- Life tenant unimpeachable of waste - Wanted to cut down all trees ESTOVERS: But, regarding trees: there is the right to cut timber for fuelling or repairing a house, for making and repairing agricultural implements, repairing existing walls, fences ditches (although use must be reasonable) Entitled to fell and sell trees, but not timber trees. Timber trees traditionally seen as o Oaks, elms and ash over 20 years of age Honywood v Honywood Chapman v Strawbridge in Australia Ameliorating waste Act which improve the land Courts will rarely step in here o Doherty v Allman (1878) Only likely to be restrained where character of premises is in jeopardy Reasonable alteration which improve premises, and are not expressly or impliedly prohibited by instrument creating life estate do not constitute waste Improving (ameliorating) waste not restrained o Muex v Cobly(1896) o FACTS - Tenant of farm converted it into market garden o Hyman v Rose (1912) o FACTS - Life tenant wished to turn chapel into cinema, and increase market value o HELD - Court would not grant injunction as changes would improve value of premises, and were not expressly or impliedly prohibited - Also, tenant lodged bond with the court to cover the cost of converting it back to a chapel Waste which improves value may not always be allowed o Hunt v Hodges (1849) o FACTS - Life estate of large country estate built lead smelter o HELD - Amounted to waste, even though lead smelter improved the value Fee Tail Tail meaning restricted Interest that continues as long as the original grantee and their lineal descendants lived Abolished by section 9 of Conveyancing Act 1919 Leasehold estate distinguished from freehold estate Freehold estate of uncertain duration and may last forever Leasehold interest expires on a given date

TORRENS TITLE

Governed by Real Property Act 1900 Fundamental principal is conclusiveness of the register Title by registration Does not alter common law, merely simplifies land transactions

Priority Rules Priority of Competing registered interests Governed by Order of registration, not by date of execution Section 36(9) Registered interest prevails over unregistered interest except when fraud or other exceptions Competing unregistered interests generally regarded as equitable interests, and treated as under old system title rules BUT, some unregistered interests are legal interests o Accepted by real property act through reference to legal or equitable interest in s74F(1) o Eg: Unregistered lease complying with s23D(2) of Conveyancing Act Tenancy at will under s127 of Conveyancing Act Easement implied under Wheeldon v Burrows Give regard to caveat provisions Assurance Fund Section 133A Real Property Act Established to compensate those who lose out due to failings of system: o Register General sometimes makes mistakes o Easy to defraud people under Torrens system Trusts In old system, problems as purchaser or mortgagee who deals with trustee has obligations to beneficiaries of trust For Torrens system o Trusts do not affect the register Registered owner is owner Trusts not recorded on register s82 Exceptions in s12(1)(f) Mortgagees Check this Under old system, mortgage required conveyance of property Whenever Torrens land intended to be made security for debt, owner is to execute approved form of mortgage (s56) o Registered mortgage of Torrens title is statutory charge or security only, not as conveyance (s57) Unregistered Interests No dealing, until registered in the manner provided by the act, shall be effectual to pass any estate or interest in any land under this act o Dealing must be registered for the interest to pass Section 41(1) Real Property Act o Note: - When read with caveat provisions, there is some scope for unregistered interests Although the instrument itself is ineffective under 41(1), the agreement itself remains effective in accordance with the general principles of equity Barry v Heider (1914)

o FACTS - B was registered proprietor of land Certificate with R-G, as land being sub-divided Signed transfer to S, who failed to pay purchase price agreed to o Gave B right to have transfer set aside S granted mortgage to H before B acted on that right o H possessed all necessary evidence and information about mortgage had done everything possible to protect interest - At this point, H and S have equitable interests - B argued that under s 41(1), he is only registered title holder, and thus only he could confer interest to H, not S o HELD - Bs registered interest set aside to equitable interests. H and S have equitable interests S41 denies the instrument conveying the transfer, but not the contractual and equitable interests in the land - Bs conduct of handing over a signed transfer to S empowered S to act as owner Bs conduct led to the mortgage, and thus he is responsible for it Unregistered interest is a valid equitable interest, but not a legal interest Chan v Cresdon Pty Ltd (1989) o FACTS - Sarcourt signed agreement for lease with owner. - Unregistered lease provided that Chan would guarantee performance of S No registered guarantee of performance S defaulted in payments, respondents proceeded against Chan o HELD - Sarcourt ought to succeed as guarantee operated only in respect of obligations under the lease Only a lease at law would satisfy that description Agreement to lease treated as equitable lease - Provisions of indemnity and guarantee strictly construed in favour of party giving guarantee - No justification to extend obligations to an equitable lease that is not a lease at law Indefeasibility of Title The register is conclusive o The register confers on the registered proprietor: - An interest in land - Indefeasible title to that land Meaning that title cannot be set aside on the ground of a defect existing in the title before it was registered Section 40 Real Property Act Person with registered interest holds that interest free of any other unregistered interests Section 42 Real Property Act o Exceptions discussed later Registered person can ignore the notice of an unregistered interest (unlike Old System) Section 43 Real Property Act A registered proprietor of Torrens title land may not be ejected from the land: title is conclusive Section 124 Real Property Act Person who purchases Torrens title interest (purchaser or mortgagee) and becomes registered

is not affected by irregularities in the preceding title Section 135 Real Property Act o Prohibits recovery from the present registered proprietor, where the took as purchaser or mortgagee bona fide for valuable consideration Doesnt matter if As vendor or mortgagor was registered through fraud, error, or under a void or voidable interest Deferred indefeasibility: no longer accepted Theory that indefeasibility did not take effect immediately in cases where the instrument was void or voidable Theory now largely discarded Arose out of decision in Gibbs v Messer o FACTS - Owner of land left certificate of title with solicitor - Solicitor forged owners signature to transfer possession in favour of fictitious person, who became registered owner - Solicitor forged mortgage from Cameron to innocent mortgagee, who took for value and without fraud, and became registered proprietor of mortgage o HELD - Owner could have registration set aside innocent mortgagee did not have indefeasible title Court said that if innocent mortgagee dealt with another person who acted on the existing state of the register, and purchased for value without fraud, that person would have indefeasible title - Reason Did not deal with registered proprietor under s43, as dealt with forger, and so did not get protection - NOTE This is not the current approach: Modern view is to look at section 42, which does not need deal to be with registered proprietor Immediate Indefeasibility: Current approach Eg if A is registered proprietor o B steals As certificate of title o B poses as A to sell land to C o B forges As signature to transfer land to C, and hands certificate of title o On registration, C acquires a title that A cannot set aside - Cs Title is immediately indefeasible - A could only take personal action against B, or maybe have a right to compensation under assurance fund Purchaser has immediate indefeasible title even though there was fraud Frazer v Walker [1967] o FACTS - Mr and Mrs Frazer own Torrens title land Mrs Frazer forges husbands signature and mortgages property Mrs Frazer fails to meet repayments Mortgagee sells property to purchaser, who registers it o HELD - Purchaser has immediate indefeasible title even though there was fraud by Mrs Frazer - Significant case where Privy Council came down in favour of immediate indefeasibility Indefeasibility for registrable dealing Breskvar v Wall (1972) o FACTS - Plaintiffs registered owners of Torrens title land - As security for loan from M, they gave him certificate of title

- M fraudulently inserted the name of X in the transfer, who knew of the fraud - X sold land to A Pty Ltd Purchaser for value without notice of plaintiffs claim Bought land in reliance on what was on register - Before A Pty Ltd lodged the transfer for registration, plaintiff lodged a caveat o HELD - Right of A Pty Ltd to be registered had priority over any rights of the plaintiff - A acquired the right to register and obtain immediate indefeasibility - Note: Could have set aside Xs interest if got there before he sold it, as X knew of fraud - High Court referred approvingly to doctrine of immediate indefeasibility

Registered mortgage is extinguished by a registered discharge of a mortgage, even where the discharge is a forgery Shultz v Corwill Properties Pty Ltd (1969) Caveats and unregistered interests o o o Three relevant aspects: Legislative scheme Effect of lodging a caveat Effect of Not lodging a caveat

Legislative Scheme Unregistered interest in Torrens title land may be protected by a caveat lodged with the Registrar General o Caveat protects unregistered interest by freezing register prohibits the recording of any dealing affecting the estate or interest Person who claims to be entitled to a legal or equitable interest or estate in Torrens title through an unregistered dealing or devolution of law may lodge a caveat Section 74F(1) o Cannot be lodged to protect a mere contractual or personal right, or a right based on statute not also conferring an interest in land - Linden v Wigg Examples of caveat-able interests Interests of purchaser under a contract of sale o Kuper v Keywest Constructions Interest of mortgagee (including mortgagee by deposit of title deeds) o Re Victorian Farmers Loan and Agency Co Ltd Interests of person arising from contributions made to the purchase price of the property o Morling v Morling Option to buy land (As is equitable interest in land on option holder) o Laybutt v Amoco Australia Right of pre-emption is NOT caveat-able o Walker Corp v WR Pateman - Although will be once act occurs that triggers exercise of that right Sterns Trading v Shteinman Contractual rights are elevated into proprietary interest by creating interest in land to secure contractual obligations o Builder given charge over land to secure repayments of amounts owing under building agreement - Griffith v Hodge

o Lender given charge over land of borrower or guarantor to secure repayment of debt - Murphy v Wright Any registered proprietor who fears improper dealing with his or her title may lodge a caveat prohibiting any dealings being recorded on it Section 74F(2) A caveat can not be lodged to protect an interest that can only arise in the future (ie must have caveat-able interest Martin v Official Trustee in Bankruptcy Effect of lodging a caveat o Caveat does not give interest in land any greater priority than it otherwise would, it merely freezes the register o Failure to lodge a caveat may lead to loss of priority that interest may have had o Failure to caveat is merely one factor which will be taken into account when searching for the better equity Butler v Fairclough (1917) Effect of Failure to Lodge A Caveat Failure to lodge caveat before later interest is acquired means that prior interest is postponed Butler v Fairclough (1917) 23 CLR 78 o FACTS - June 30 Good (Registered proprietor of Torrens land) gave unregistered mortgage to Butler - July 2 Good sells property to Fairclough o Fairclough searched register and found nothing - July 8 Butler lodged caveat claiming equitable interest in land as equitable mortgagee - July 12 Fairclough attempts to register the property stopped by caveat o HELD - Fairclough wins, as defendant paid purchase price before caveat lodged Anyone who gets an interest in land should lodge a caveat Roses Case: Osmanoski v Rose [1974] o FACTS - X sells to A who does not register - X t hen sells to B who searches the register and finds no interest lodged o HELD - B prevails over A, as B searched register Priorities regarding unregistered equitable interests Generally first in time prevails, but court will consider: 1. Whether conduct of prior interest holder might lead subsequent interest holders to purchase in belief that prior interest did not exist 2. Whether reasonably foreseeable that conduct of prior interest holder might lead another to acquire subsequent interest 3. Whether holder of interest omitted any precaution that a prudent purchaser would have taken that may have disclosed the prior interest 4. Whether holder of subsequent interest suffered loss or detriment Conduct of prior interest holder leading to belief that did not exist Will lose out if own action led to the wrongful transfer: ie arm third person with power to go into world under false colours

Failure to lodge caveat also relevant, as lodging would disarm the person Abigail v Lapin [1934] o FACTS - Respondents owed money to solicitor, so executed an instrument of transfer in favour of solicitors wife Gave transfer and duplicate of certificate of title to solicitor as security for payment of costs - Solicitors wife used documents to become registered proprietor of the land Also, wrongfully mortgaged land to appellant (in breach of agreement) - Conflict between earlier equitable interest of respondents with later equitable interest of appellant o HELD (Privy Council) - Later unregistered interest has priority Respondents bound by the natural consequences of their acts in armingthe power to go out in the world as absolute owners of lands, and thus execute transfers and mortgages of lands to other persons They ought to be postponed to the equitable rights of Abigail Failure to lodge a caveat reinforced Solicitors wifes apparent ownership of the land Heid v Reliance Finance Corporation Pty Ltd (1983) o FACTS - Appellant agreed to sell company Contract arranged for part of purchase price to be: o Paid in cash o And some Settled by mortgage in favour of the appellant o And some Deposited with finance company Appellant gave nominated employee of company a signed instrument of transfer, and arranged certificate of title to be forwarded to him Appellant told consideration provided, BUT o Mortgage never registered o Cash not deposited with finance company - Purchasing company used certificate of title and signed instrument of transfer to borrow money from unknowing respondent on security of the land - Court had to decide which unregistered interest would gain priority o HELD - Unregistered interest of appellant deferred to later unregistered interests of respondent Appellant armed third person with the power of going into the world under false colours Failure to lodge a caveat significant, as could have disarmed the capacity of the third party to deceive others - Outcome would have been different if caveat lodged before respondent lent money, as respondent would then have acquired interests with notice Reasonably foreseeable Failure to lodge a caveat will not see interest defeated if it was not reasonably foreseeable that the interest would be adversely affected by failure to lodge Jacobs v Platt Nominees Pty Ltd [1990] o Appeal Division of Supreme Court of Victoria o FACTS Father and mother controlled company which owned motel Had company grant an option (for valuable consideration) to their daughter to purchase the motel - Daughter did not lodge caveat, as relied on mother to ensure that company did not dispose of the land - Unknown to mother and daughter, father sold the land to a trustee company o HELD - In fairness and justice the daughter should not be deprived of her prima facie

priority Not reasonably foreseeable to the daughter that the trustee company would be adversely affected by her failure to lodge a caveat Failure to lodge a caveat was reasonable as it would have been a deceit to her family to lodge one Omission of precaution of prudent purchaser Must search the register There is a duty to make enquiries into the ownership: Failure to lodge caveat will not postpone if search of title was not sufficient Prior interest will not be deferred to subsequent interest who refrains from making those enquiries which a prudent purchaser would make J & H Just (Holdings) Pty Ltd v Bank of New South Wales (1971) o FACTS - Equitable mortgagee did not lodge caveat, but did obtain possession of duplicate certificate of title - Another mortgagee subsequently searched the original certificate of title at the registrars office, but did not seel production of the duplicate certificate Gave owners a second equitable mortgage o HELD - First equitable mortgagee not postponed to later mortgagee No duty to lodge a caveat On the facts, duplicate of certificate of title was sufficient to protect interests, as appellant ought not to have settled without obtaining possession of the duplicate Butler v Fairclough (1917) 23 CLR 78 o Search of register was sufficient, showed no caveats, so interest prevailed Avco v Fishman [1993] o Doubt about the way this case would be decided in NSW o FACTS - A gives registered mortgage to Avco, who also gets certificate of title - Avco gets second mortgage from A, but second mortgage is unregistered and uncaveated - A grants third mortgage to Fishman, who searches register and found only one mortgage - When A defaulted, court had to decide priorities o HELD - It seems that Fishman would have priority over second mortgage, but court found Fishman should have asked possessors of certificate of title to tell him of all the interests they have over the land - Note: doubt as to if case was in NSW Must search register just before granting mortgage Drulroad Pty Ltd v Gibson (1992) o FACTS - RP gives unregistered mortgage to A A ineffectively lodges caveat - RP negotiates mortgage to B B searches register and finds no record of As interest - The day before mortgage granted to B, A successfully lodges caveat - B grants mortgage without making final search o HELD - There was constructive notice a prudent purchaser would have checked the register just prior to the granting of a mortgage Have to look at document itself, and not just rely on summary of registrar general Bursill Enterprises Pty Ltd v Berger Bros Trading Pty Ltd (1971)

o FACTS - B submits registered transfer to grant right of way over certain land, and to transfer a fee simple interest in airspace above part of the land to a neighbour A - Registrar generals notification of the transfer described the right of way, but made no reference to the airspace - Years later, C buys Bs land after having checked the register C tries to get airspace as well o HELD - Prudent purchaser should have looked at past summary of the transfer, and should have continued search and discovered that airspace also considered - Requires Similar search as for old title land Person only needs to search the Torrens register Section 43A(2) Finlay v R&I Bank [1993] o Windeyer J o FACTS - Company put charge over land to A. A did not lodge caveat, but did register charge in Companies register - Company gave charge to B B searched Torrens register and found no caveat Did not check companies register o HELD - B prevailed because a failed to lodge caveat - Only need to search Torrens register Section 43A Real Property Act Purchaser under Torrens Title only has equitable interest until registration o No deed of conveyancing giving legal title as in old system o So, is subject to any earlier equitable interests in the absence of postponing conduct o Section 43A(1) attempts to fill this gap A person who acquires an interest in Torrens title land need not be concerned about notice of an unregistered interest they may have received in the course of the transaction Section 43, Real property act o Although courts have read this down to only apply to registered interests, thus section 43A A purchaser (between the transfer and registration) with a dealing registrable has a legal interest in land o Legal estate Makes you free of earlier equitable interest Is not the equivalent of registered estate o Dealing which is registrable Must be able to be registered immediately o Only gives protection until registration once this occurs, they enjoy indefeasibility o Only gives protection to later interest from earlier interest Does not afford protection to earlier interest from later one Section 43A(1), Real property act o No other state has equivalent to s43A (although ACT and NT do) Section 43A gives the same measure of protection given at common law to a person who has acquired a legal estate in land without notice of some prior equitable interest Ie Wilkes v Spooner applies to Section 43A: o If the first purchaser does not have notice of an earlier equitable interest, the second

purchaser is given the same protection o Legal interest is not the same as registration o If there is notice, it is a case of competing unregistered equitable interests Jonray (Sydney) Pty Ltd v Partridge Bros Pty Ltd (1969) 89 WN (Pt 1) (NSW) Ie, No protection for purchaser who has notice of prior equitable interest. o Jonray (Sydney) Pty Ltd v Partridge Bros Pty Ltd (1969) 89 WN (Pt 1) (NSW) 1. Transfer by direction has protection of section 43A (point 1 in case). 2. Successive effect (point 2) Jonray (Sydney) Pty Ltd v Partridge Bros Pty Ltd (1969) 89 WN (Pt 1) (NSW) o FACTS - Registered proprietor of land subject to registered mortgage Entered into contract to sell land to P - Before sale completed to P, P entered into contract to sell same land to Jonray (J) There was insufficient time for P to get his interest registered o Usual practice would be for the three parties to get together, and J would leave with two transfers from the registered proprietor to P, and from P to J Upon settlement to J, Partridge (P) proposed to hand J a memo of transfer by direction, together with an unregistered discharge of As mortgage - J tried to get out of contract, delayed performance of the contract for two reasons, claiming that: 1. Under the traditional method, J would not get a dealing from P that is immediately registrable, and thus there is not protection under section 43A 2. If there was a irregularity in the mortgage (ie a defect in the discharge), J would owe an equitable interest to the mortgagee, as J would receive no protection under s43A, as he was not taking the discharge (an interest) directly from registered proprietor, and thus did not have a dealing registrable o HELD 1. J is effectively taking a transfer from the registered proprietor, and thus will receive the benefits provided by section 42, 43, 43A 2. Evoked rule from Wilkes v Spooner: Someone who takes an interest without notice hands the land on to subsequent holders free of that interest Thus, J is given the protection of s43, and is not entitled to require that discharge of mortgage be registered by P before settlement There is constructive notice if there is a failure to search the register as a prudent purchaser Drulroad Pty Ltd v Gibson (1992) o FACTS - RP gives unregistered mortgage to A A ineffectively lodges caveat - RP negotiates mortgage to B B searches register and finds no record of As interest - The day before mortgage granted to B, A successfully lodges caveat - B grants mortgage without making final search o HELD - There was constructive notice a prudent purchaser would have checked the register just prior to the granting of a mortgage Must have a dealing registrable to gain the protection of section 43A. Requires possession or control of the certificate of title. Must also be registrable without any intermediate dealings having to be carried out Finlay v R & I Bank of WA (1993) NSW o FACTS - Registered proprietor gave registered mortgage to A

 Mortgage registered, and A held certificate of title - Registered proprietor gave unregistered mortgage to B, then another unregistered mortgage to C - Issue whether B or C prevails B argued had earlier interest, therefore should prevail C argued protection under s43A o HELD - No protection under s43A, as no possession or control over certificate of title - Registered proprietor owned land in Taree and Nelson Bay - Commonwealth Bank registered first mortgage over Taree land, and held certificate of title No protection under 43A for a void dealing (eg forgery) Jonray (Sydney) Pty Ltd v Partridge Bros Pty Ltd (1969) o NSW Court of Appeal - A registered proprietor who title is threatened by a yet to be registered void dealing can probably prevent registration of the instrument, whether or not the transferee had notice of it o Thus, they get no protection under 43A(1) or Wilkes v Spooner Statutory Exceptions to Indefeasibility o o o o o o Built in exceptions Fraud Earlier recorded interests Listed exceptions in s42(1) Volunteers (possibly) Exceptions through general principles In personam/personal equity Later statute

Fraud Fraud is an exception under section 42(1) (i) What is fraud in the Torrens system? (ii) What is the relationship between fraud and notice? What is fraud in the Torrens system? o Must be actual fraud - Dishonesty of some kind - Constructive fraud not sufficient o Must relate to current state of title - Person to be impeached for fraud must have been fraudulent Fact that vendor fraudulent is irrelevant to purchaser o Fraud by agent of purchaser can affect title o Mere fact that you might have found out vendor had committed fraud if were more vigilant is not fraud - But, if shut eyes in fear of learning the truth, it is fraud Assets Co Ltd v Mere Roihi [1905] Fraud when registered proprietor, when lodging for registration, either intentionally misrepresented the Register-General that statutory requirements for executing dealing were complied with, or was recklessly careless whether or not they were complied with: o Misrepresentation

o o o

Recklessly careless AGC v De Jager [1984] Tadgell J FACTS - Bank gave mortgage to customer to sign - Applicants signature was forged - Witness to signature contacted bank and said that he was not there when signature signed - Mortgage still registered by bank o HELD - Mortgage was not indefeasible, as fraudulent for bank to lodge registration knowing that mortgage was improperly witnessed Fraud must be made by the registered proprietor Grgic v Australian and New Zealand Banking Group Ltd (1994) Refusing to acknowledge Bs rights constituted fraud within the meaning of s 134 Bahr v Nicolay (No 2) (1988) 62 ALJR 268 o Mason and Dawson (not majority) o FACTS - Mr and Mrs Bahr sold land to Nicolay, subject to right to repurchase land at time and price stated in contract - Nicolay sold land to Mr and Mrs Thompson under contract that effectively provided that sale was subject to right of Bahrs to repurchase - Thompsons became registered, and regused to give effect to rights of Bahrs o HELD - Mason and Dawson (not majority) Ts conduct in refusing to acknowledge Bs rights constituted fraud within the meaning of s 134 Agreement between Nicolay and Thompsons created an express trust of benefit of the agreement in favour of the Bahrs Registration of Thompsons as proprietors did not present enforcement of that trust by o The indefeasibility provisions in legislation as repudiation of agreement that Bahrs should be entitled to re-purchase the land amounted to fraud Relationship between Fraud and Notice Mere notice is not fraud Section 43(1) Real Property Act o Confers protection for registered holder against notice, except in case of fraud - Means that knowledge itself is not fraud Notice of prior interest does not affect Indefeasible title once registered Oertel v Horden (1902) o FACTS - A leases property to B, who goes into possession but does not register - A sells to C, who registers o HELD - C can kick out B, as notice is not fraud C has indefeasible title, as mere notice of someone elses interest is not fraud o C takes land free of earlier equitable interests Not bound by contract and notice Munroe v Stuart (1924) o FACTS - A grants unregistered lease to B

- A sells to C, who registers C has knowledge of Bs lease Contract states contract subject to any leases o HELD - C has indefeasible title, as mere notice of someone elses interest is not fraud - Contract put C on notice of Bs interest, but does not bind him - NOTE: Bahr v Nicolay suggests that this may be reconsidered Mere notice is not fraud, but when other factors it may be fraud Loke Yew v Port Swettenham Rubber Co Ltd [1913] AC 491 o FACTS - A gives unregistered lease to B - A sells to C, who registers - C negotiated lower price off A due to fact B had lease over property - Upon registration, C attempts to evict B o HELD - C guilty of fraud Only gets defeasible title Does not prevail over B, and thus cannot kick B off It is fraud to lull interest holder into not registering, and then relying on registered title to defeat that interest Mock v Thompson (1982) o FACTS - A grants lease to B that requires registration - A sells to C - C asks B if C can register first, as it would be easier, but promises to lodge the lease straight afterwards - C does not lodge Bs registration, and then tries to kick him out o HELD - C guilty of fraud, as lulled B into false sense of security Fraud to frustrate registration of unregistered interest to acquire and register ones own interest Costin v Costin Fraud to become registered as proprietor under course of conduct engineered to deprive a beneficiary of his or her beneficial interest in a trust property Brun v Brun *Earlier interest recorded Have to look at document itself, and not just rely on summary of registrar general Bursill Enterprises Pty Ltd v Berger Bros Trading Pty Ltd (1971) o FACTS - B submits registered transfer to grant right of way over certain land, and to transfer a fee simple interest in airspace above part of the land to a neighbour A - Registrar generals notification of the transfer described the right of way, but made no reference to the airspace - Years later, C buys Bs land after having checked the register C tries to get airspace as well o HELD - Prudent purchaser should have looked at past summary of the transfer, and should have continued search and discovered that airspace also considered - Requires Similar search as for old title land

Listed Exceptions under s42(1) Easements Protection for easements if: 1. Existing immediately before converted to Torrens title Ie easement left off register 2. Validly created easements after conversion to Torrens system Unlikely to apply when parties do everything formally required but have left it unregistered, as it is not validly created Section 42(1)(a1) Real Property Act 1. Easement exception applies where there was easement when land was under old system title, but it was left off when converted to Torrens title Dobbie v Davidson (1991) o FACTS - Easement by prescription created by using land for 20 years, created under old system title - When land converted to Torrens title, omitted o HELD - Easement was omitted under the scope of the legislation Auerbach v Beck [1985] o FACTS - V owns 2 adjoining houses, and had overhanging eaves and gutters - V subdivided, one property sold Eaves and gutters projected into airspace next door - Was there a quasi easement due to continuos and apparent use? o HELD - Easement by implication arose on sale of houses o Torrens title relevance - Later conversion of land, R-G failed to discover the existing easement - As easement granted before transition, fits under exception 2. Implied easements that are not put on the register are likely to be destroyed under the new s42(1)(a1) o Under the old section 42(1)(b), an implied easement is enforceable between the two parties under the rights in personam exception o When servient tenement is sold, the new purchaser is not subject to the easement - Thus, must make sure that implied easement is formally granted Australian Hi-Fi Publications Pty Ltd v Gehl [1979] o Case under old s 42(1)(b), but likely to hold under the new section 42(1)(a1) o FACTS - Originally, whole site owned by Savage, and easement existed - When divided and sold, easement not noted on either certificate of title o HELD - Was only equitable easement, and could only be enforced by the original parties - Third party purchaser gets indefeasible title - To be omitted under the old act means that the Registrar General has not done what ought to be done, it does not allow for partys mistakes To make implied lease enforceable under Torrens, need to force owner of servient land to sign a transfer granting an easement, and lodge it for registration Australian Hi-Fi Publications Pty Ltd v Gehl [1979] 2 NSWLR 618 Auerbach v Beck [1985] o FACTS - V owns 2 adjoining houses, and had overhanging eaves and gutters - V subdivided, one property sold

 Eaves and gutters projected into airspace next door - Was there a quasi easement due to continuos and apparent use? o HELD - Easement by implication arose on sale of houses o Torrens title relevance - Later conversion of land, R-G failed to discover the existing easement - As easement granted before transition, fits under exception Short Term Leases Exception to indefeasibility for short term tenant when tenant: o If in Possession or entitled to immediate possession o Purchaser had notice of tenancy against which they are not protected - Similarly to old system title rules of notice - Possession is notice - Constructive notice sufficient (Kline v Lowe 1969) o Term of tenancy, including option for additional terms, does not exceed three years Section 42(1)(d) If Original lease less than three years, and option takes it over 3 years, original lease may still be protected (but question left open) Likely that the whole thing is unprotected Alcova Holdings Pty Ltd v Pandarlo Pty Ltd (1988) 15 NSWLR 53 o FACTS - A gives B unregistered lease for 2 years with option for further 2 years - A sells to C who registers When lease exceeds 3 years, legal tenancy at will may be implied under section 127 of Conveyancing Act, which attracts protection of 42(1)(d), and requires one months notice Application of Chan v Cresdon Personal Equities/Rights in Personam Implied into the act as a way in which title can be set aside without relying on the strictly interpreted fraud provisions Indefeasibility in no way denies the right of a plaintiff to bring against a registered proprietor a claim in personam Frazer v Walker (1967) o Lord Wilberforce To establish a right in personam, must find a common law or equitable cause of action, not merely a sense of wrongfulness Lissa v Cianci (1993) o FACTS Husband and wife take on mortgage to guarantee loan for son Husband in accident at time of signing, had no idea what he was doing Wife had only 3 years of schooling and spoke little English o HELD Mortgage could be set aside Was a case of non-est factum, common law contract notion of not knowing what you are signing Logue v Shoalhaven Shire Council (1979) o FACTS - Logue behind in rates. - Council sought to sell him up - In advertisement, council misrepresented sum of outstanding rates

- Council could find no buyer, bought it back themselves - Logue sought to rely on personal equity advertising wrong amount invalidated the sale o HELD - Failed Personal rights must have arisen out of acts, words and events to which the person whose title is being challenged must have been a party to Garafano v Reliance Fin Corp (1992) PT Ltd v Maradona Pty Ltd (1992) Registered title may be set aside if registered proprietor purchased in circumstances where vendor bound by unregistered interest of third party, and had contracted (express or implied) that it would recognise the third partys interest Bahr v Nicolay (No 2) (1988) o FACTS - Bahrs sold to Nicolay, subject to right to repurchase at time and price. - Nicolay sold to Thompsons under contract providing for rights of Bahrs - Thompsons became registered and refused to give effect to rights of Bahrs o HELD - Found Personal equity and Fraud - Registered title may be set aside if registered proprietor purchased in circumstances where vendor bound by unregistered interest of third party, and had contracted (express or implied) that it would recognise the third partys interest Whilst purchase with mere notice is not enough to raise personal equity, additional factors indicating purchasers agreement to be bound by unregistered interest Personal equities can create interests that did not actually exist before Snowlong Pty Ltd v Choe (1991) o FACTS - Landlord gives lease to tenant for 5 years Lease remains unregistered - Landlord sells property to purchaser who registers the transfer - He sells to purchaser 2 subject to the 5 year lease - Purchaser 2 tries to evict tenant o HELD - Purchaser 1 got indefeasible title by registering, giving tenant a lease at will determinable at 1 months notice - BUT, agreement between P1 and P2 means that tenant can enforce the full 5 year lease Justice Wood Other factors in addition to forgery may create personal equity Mercantile Mutual Life Insurance Co Ltd v Gosper (1991) o FACTS - Mrs Gosper got mortgage from Mercantile which she is able to very easily - Mr Gosper forges Mrs Gospers signature to increase mortgage, and variation registered No evidence that signature was forgey, but they did not attempt to communicate with her - Mr Gosper dies, and Mrs Gosper finds out o HELD - Production of certificate of title without Mrs G was breach of obligations - Kirby J held only had to repay original amount - Mahoney J held that she gained a personal equity through the bank using the certificate of title without her permission - Judgements criticised due to lack of cause of action (Kirbys), and difficulty in checking everything (Mahoney) - Dissenting judge says that as registered without fraud by bank, usual indefeasibility of title results

Forgery alone is not enough Storey v Advance Bank (1993)] o FACTS - Husband and Wife formed company - Company was registered proprietor of torrens land - Husband, without knowledge of wife, gave bank a mortgage on property by forging wifes signature - Bank registered mortgage - Company tried to have mortgage put aside on basis of personal equity o HELD - Bank was able to rely on the mortgage, as they should not have been expected to see through the forgery and the husbands rouse - If all you can show is forgery, cannot establish cause of action against innocent mortgagee Bank gets indefeasible title Personal equities and rights Grgic v Australian and New Zealand Banking Group Ltd (1994) o REALLY NOT SURE ABOUT THIS CASE< DONT USE IT o Powell JA o FACTS - ANZ officer attested to signature of person impersonating the registered proprietor - Mortgage payments not met o HELD - G lost bank did not know him personally, and so did not act improperly Registrar-Generals Power of Correction Registrar general is authorised to correct errors and omissions in the Register Section 12(1)(d) o In practice, exercised only to correct obvious clerical and administrative errors - Accords with settled view that it is not for the Registrar-General to settle conflicting claims to land RG can call in certificate of title to make amendments Section 136(1) (b) Real Property Act James v Registrar-General (1967) 69 SR (NSW) 361 o FACTS - Easement properly created and proper forms lodged and registered, and appeared on certificate of title - When page was full, a new page started, and easement accidentally left off - RG realized mistake, and requested certificate of title to amend mistake - James refused - When James went to mortgage land some time later, Registrar general amended the certificate of title - Question whether RG had power to do this o HELD - RG simply doing what law required Has power to correct as long as can prove it was an omission Used to be that power to correct under s12(1)(d) is lost once a bona fide purchaser or mortgagee has acquired an interest on the faith of the uncorrected register, and becomes registered Frazer v Walker James v Registrar General

 BUT: This was overturned by section 12(3) in 1970 o RG can make corrections to the register at any time, although correction is not to prejudice rights of a person who has registered a right before the change is made - Odd: how can a subsequent correction not affect the present owner? - Even if not enforced until next owner, affects price of sale Error must be one of the registrar general, not the parties Scallion v RG (1988) Overriding Statutes Like any legislation, the Real Property act is subject to later legislation o Principle that later statute impliedly overrules older statute to the extent that they conflict Later statutes can create interests that bind the land, even if they are not registered, because: o It is not an interest that can be registered - Miller v Minister of Mines (1963) o It is not a proprietary interest - Linden v Wagg (1968) Rent control legislation, when protected tenant died, close family could stay in possession of premises o No procedure in the Real Property Act by which it may be registered or recorded Thus, the Register is not an exhaustive list of interests in land Legislation later than Real Property Act 1900 overrules it Pratten v Warringah Shire Council (1969) 90 WN (Pt 1) (NSW) 134 o FACTS - Block of land crossed by underground drainage pipes which were owned by the council - Council becomes owner of land, but drainage pipes not registered - Pratten wants to buy land from council, so searches register - Also writes twice to the council to check whether they own the pipes Council says they do not own pipes - Further, lawyers write to Registrar general and ask him to do an official search of the register which confirms that no interests in the drainage pipes are registered - Pratten finally buys land - Council later realises that it does own the pipes Under 1919 statute o HELD - Legislation which gives ownership to council is 1919 statute, which therefore overrules the Real Property Act - Estoppel raised, but could not be applied because statutory authorities who have obligations over land cannot be estopped from performing those duties Estoppel and possessory title may be relevant defence to later statutory Quach v Marrickville Municipal Council (1991) o FACTS - Drainage reserve not shown on register - Quach makes search, finds nothing, buys land and registers - Years later, council sought to assert ownership over reserve Given under 1919 statute o HELD - Later statute overrides RPA (as in Pratten) - BUT: Estoppel available as Mr Quach had paid rates for years for whole land Possessory title

o Had possession for 12 years and so acquired the title o Councils title extinguished o Although possibly lucky on this point, as under s45D of Real Property Act, cant acquire title to strips of land, only to the whole block Volunteers Volunteer: o Someone who has not paid valuable consideration for an interest Question whether volunteers, once registered, get same indefeasibility as those that give consideration o Not specifically referred to as exception in legislation o But, they are not a bona fide purchaser for value, as have provided no value Law may be different for NSW and Victoria Maybe no different: Section 42 does not discriminate May be less indefeasible: o Not a purchaser as referred to in section 43 In NSW, volunteer gets exactly the same title and indefeasibility as those who pay value Section 42 does not say that you need to pay value to get indefeasibility, and so is indiscriminate as to whether you gave consideration or not Bogdanovic v Koteff (1988) o FACTS - Koteff senior invites Bogdanovics to live Gives Mrs B a life estate o Equitable interest under constructive trust - When he dies, house given to son, who knew nothing of equitable or contractual interest to B wants her out - He became registered proprietor without knowledge of equitable or contractual rights o HELD - Indefeasibility provisions apply same to registered proprietor of land who takes interest in land as volunteer Allows rp to take title free from prior equitable interests which she had no notice of - The oral promise to her would be sufficient, however in this case, Koteffs son became registered proprietor without prior knowledge of contractual or equitable right, and obtained indefeasible title - King v Smail (Victorian Case) should no longer be followed, as Breskvar v Wall, following Frazer v Walker, established that the title of each registered proprietor arises from registration In Victoria, Registered proprietor of torrens title land who took without value could have no better title than their predecessor IE they are bound by the equitable interests that stood under the old ownership Rasmussen v Rasmussen [1995] o Victorian decision King v Smail (Victorian) o Similar proposition to Rasmussen o NOTE: In NSW, in Bogdanovic v Koteff, court said that King v Smail (Victorian Case) should no longer be followed, as Breskvar v Wall, following Frazer v Walker, established that the title of each registered proprietor arises from registration