Other Exceptions and Overriding Statutes

From Uni Study Guides
Jump to: navigation, search

This article is a topic within the subject Property, Equity and Trusts 2.

Contents

Required Reading

Edgeworth et all, Sackville and Neave's Property Law Cases and Materials, 8th edition, Lexis Nexis, 2008, pp. 543- 555 [5.108-5.124]; 620-621 [5.199].

Extract from City of Canada Bay Council v Bonaccorso Pty Ltd [2007] NSWCA 351.

Introduction

There are a number of other exceptions to the principle of indefeasibility. The extent of the application of these exceptions (ie, how broad they are) varies between states, with Victoria usually offering the broadest exceptions to indefeasibility, and NSW being more narrow. The exceptions include:

  • Prior certificate.
  • Wrong description.
  • Omitted easements.
  • Profits-à-prendre
  • Short terms leases.
  • Adverse possession.
  • Overriding statutes.

These exceptions will now be explained in detail.

Prior Certificate

[1] If there is a situation where two people have conflicting certificates of title, the earlier one prevails (the second one won't be indefeasible).[2]

  • This means, the fact that someone is a registered proprietor, and has a certificate of title, will not protect him if someone comes along and shows that he has a prior certificate of title.
  • The second certificate is treated as having been issued wrongly.

Wrong Description

If the registry's description of a parcel of land is wrongful (ie, the parcel has been attributed land which doesn't belong to it), the registered proprietor will not be protected by indefeasibility against purchasers for value or volunteers who obtained the title from a purchaser for value who are the real owners of the misdecribed land.[3]

Omitted Easements

[4] If the registry failed to describe or include an easement ‘subsisting immediately before the land was brought under the provisions of this Act or validly created at or after that time under this or any other Act or a Commonwealth Act’, the registered proprietor will not be protected by indefeasibility against that easement.[5]

Profits-à-Prendre

Indefeasibility does not protect a register proprietor from unregistered profit à prendres.[6]

Short Term Leases

[7] A registered proprietor is not protected by indefeasibility against unregistered short term leases so long as:[8]

  1. The tenant is in possession or entitled to immediate possession;
  2. The purchaser of the reversion has notice of the tenant’s interest;
  3. The lease is for less than 3 years;
  4. In the case of an option to renew the lease, the total duration (including the original) is less than three years;

Adverse Possession

[9] This is not a normal 'exception' - after the completion of the 12 year period required for adverse possession (see also limitation of actions), an adverse possessor can apply to alter the registry and register himself as the registered proprietor.[10]

  • The registered proprietor thus cannot rely on his indefeasiblity to stop registration.
  • However, the mere completion of the 12 years would not automatically extinguish the title of the registered proprietor - only after he alters the registry.

The process has a few more requirements and principles, which are set out in Part 6A of the Real Property Act 1900 (NSW). The process can be summarised as follows:[11]

  • The person must be in possession of the 'whole parcel of land' may apply to the registrar to be recorded as the registered proprietor.
  • The owner's title must have been extinguished under the rules of adverse possession (12 years etc).
  • Such an application can't be made against the Crown etc.
  • If the current registered proprietor was a bona fide purchaser, the whole of the limitation period must have run against that current proprietor.

Overriding Statutes

[12] The Torrens statute (Real Property Act 1900) is, after all, just a normal statute. This means that if a later statute is inconsistent with it, the later act prevails to the extent of the inconsistency.

  • This means that a registered proprietor would not be protected by indefeasibility if this is inconsistent with anything said in a later statute.
  • For example: if a new statute is passed saying the Crown has an interest in the property of X, X won't be able to rely on indefeasibility to defeat the Crown's claim.

This was discussed in Pratten v Warringah Shire Council:[13]

  • Facts: an act was passed saying that all land described in plans as 'drainage reserve' belonged to the local council. The registered proprietor attempted to rely on his indefeasibility to defeat the Council's unregistered interest.
  • Held: the indefeasibility provisions were hereby repealed insofar as they applied to land described as 'drainage reserve'. The Registered proprietor was not protected from the Crown's unregistered interest.

The same act mentioned in Pratten was discussed in Quach v Marrickville Council (No 2),[14] where the plaintiff successfully argued that he had regained his land through adverse possession. The Court pointed out that overriding statutes represent 'the weakest point in the Torrens System'.

Another example was Horvath v Commonwealth Bank of Australia:

  • There is a strong presumption that parliaments do not intend to repeal previous acts but rather for both acts to operate in their separate spheres. There must be a very strong basis to support the idea that an act is meant to repeal another.
  • If the relief provision can be given effect without repealing the indefeasibility provisions, than those provisions will not be repealed.

And City of Canada Bay Council v Bonaccorso Pty Ltd:[15]

  • Facts: land was transferred by a council to another party despite the fact that a later statute prohibited the council from doing so. The issue was whether the later statute repealed the indefeasibility provisions because of an inconsistency.
  • Held: reaffirming Horvath, there is a very high bar for determining an implied repeal. This could not be proved in this case, and the acts are not inconsistent to the required degree. The acts here operated sequentially - the first act operated before registration, meaning that the transfer could have bit set aside until the moment it was registered. Once it was registered, the indefeasibility provisions started operating, and consistently with Breskvar v Wall, the transferee obtained a new clean title regardless of however faulty the process.

Since these cases were decided, a reform has been introduced which qualifies the effect of the overriding statutes.

  • The indefeasibility provisions prevail over inconsistent provisions, unless the inconsistent provisions expressly provide that they have the effect of excepting indefeasibility.[16]

End

This is the end of this topic. Click here to go back to the main subject page for Property, Equity and Trusts 2.

References

Textbook refers to Edgeworth et all, Sackville and Neave's Property Law Cases and Materials, 8th edition, Lexis Nexis, 2008.

  1. Textbook, pp. 545-6 [5.112].
  2. Real Property Act 1900 (NSW), s 42 (1) (a).
  3. Real Property Act 1900 (NSW), s 42 (1) (c).
  4. Textbook, pp. 547-8 [5.114].
  5. Real Property Act 1900 (NSW), s 42 (1) (a1).
  6. Real Property Act 1900 (NSW), s 42 (1) (b).
  7. Textbook, pp. 546-7 [5.113].
  8. Real Property Act 1900 (NSW), s 42 (1) (d).
  9. Textbook, pp. 548-9 [5.115].
  10. Real Property Act 1900 (NSW), s 45C.
  11. Real Property Act 1900 (NSW), s 45D.
  12. Textbook, pp. 549-50 [5.117].
  13. (1969) 90 WN (NSW) (Pt 1) 134.
  14. (1990) 22 NSWLR 55.
  15. [2007] NSWCA 351.
  16. Real Property Act 1900 (NSW), s 42 (3).
Personal tools
Namespaces

Variants
Actions
Navigation
Toolbox