Major Questions in Property Law - Essay Example

Question The case at bar presents a reverse scenario than that of Garcia v. National Australia Bank Ltd. where the operation of law based on the Torrens Title affords. The Torrens system established under the Real Property Act provides a State guarantee of the owners title to land.1 Under the Torrens system, no interest in land can pass at law until a transfer is registered. He/she who is a holder of title under the Torrens System shall have absolute right over the property as against any claimant thereof. Thus, in our scenario where we assume that Ms. Garcia is a holder of a Torrens Title of the land in question, the annotation of the mortgage on the title would effectively bind Ms. Garcia and other persons or entities that may later on claims interest on the property. By virtue of its nature, an annotation on the Torrens Title is indefeasible. Where there is clear showing that the property is held under the Torrens Title, the argument in Garcia shall not be applicable. Reliance on the mortgage and guarantee executed over the couple’s home as evidence by the annotation in the Torrens Title is enough to bind the couple and other interested persons. Question # 2 a. My advice to Ms. Tomasina Jones is to seek redress in court based on the argument of prior right over the property and the fact that it was sold without her consent and authority. She can file a case against Ms. Thompson for fraud and recovery of property. Since Ms. Esther Asterix have not registered the sale and could not be held the absolute owner thereof thus Ms. Jones can claim prior right. Furthermore, since Ms. Thompson unduly enriched herself on the expense of Ms. Asterix, she shall be liable to return the money to Ms. Asterix plus damages. To best understand how the case metamorphosed, let us go back to the facts. Ms. Jones is a holder in fee simple where she has all the rights towards the property. In the case at bar, she employed Thomson Thompson to manage the far in her absence. Unfortunately, Ms. Thompson found the certificate of title concealed in an old Tim Tam Indulgence tin and used the same to sell the land to Esther Asterix. Ms. Asterix paid the valuation on a walk-in-walk-out basis, which is valid under the Conveyancing Act 1919. At the time of the sale Ms. Asterix have no idea that Ms. Thompson was not really the true owner of the property, making her a purchaser in good faith2 under Section 29B of the Conveyancing Act 1919. Under this section, “an instrument purporting to exercise a legal or equitable power of appointment over property, which, in default of and subject to appointment, is limited to or held in trust for a class or number of persons as against a purchaser in good faith, provided that, if the interest appointed exceeds in the amount or value the interest in such property…” In this case, apart from the fact that the seller has no authority to do so, the purchaser in good faith complied with the provisions of this law the fact that the sale was made at fair market value. However, since at he very beginning there was already intent to defraud both Ms. Jones and Ms. Asterix, there contract of sale is vitiated and should be considered void ab initio. b. In another scenario where Ms. Asterix already registered the sale of the property, my advice to Ms. Jones would still be to go court have the sale declared void on grounds of fraud. Section 37B of the Conyeancing Act 1919 states that “every instrument (other than a will) which operates, or on registration would operate as a voluntary alienation of land, shall, if made with intent to defraud a subsequent purchaser, be avoidable…” Question # 3 As in-house counsel for Oneproperty I will advice the company as follows: a. Perustyle In the case of the lease under Perustyle, there is a ground for non-renewal of the contract under the provision of breach of contract. Under the original contract entered into by the company, the lease included a property owner’s covenant to repair the premises, excluding repairs to any locks. The lease was for a term of five years with an option to renew for a further five years. The lease gave the landlord the power to forfeit the lease in the event that the rent was in arrears for two weeks or if any other covenant was breached. Perustyle followed all the terms of the lease except one, which are the repairs of the locks. However, under the terms of the contract, it was stated that breach of any other covenant would warrant the non-renewal thereof. Although Section 133E of the Conveyancing Act 1919 operates so as to prevent lessor from refusing to grant new lease, this does not give absolute right to the leases to have its lease contract renewed. In the case of Gilbert J MacCaul (Aust) Pty. Ltd v Pit Clud limited (1959) 59 SR (NSW), the observance and performance of the covenants and agreements in the lease was a condition precedent to the right to exercise irrevocable offer so that any breach by way of non-observance or non-performance at any time during the term of the original lease, whether or not complaint was made at that time, was sufficient to prevent tenant’s entitlement or to a right to a new lease pursuant to the option. In our present case of Perustyle, the antecedent conditions were the repairs of the locks, which were found not complied as per the property inspection conducted. Since the contract was clear that any breach of any part of the covenant can be a ground for a non-renewal, the ruling of the case of Flagstaff v Cross Street (1999) NSWSC 999, cannot be availed of. In the case of Flagstone, the court concluded that s 133F does not bear upon breaches of covenant after notice. Although in our case, the breach was found after Perustyle gave notice of intent to renew the contract, the covenant was clear and unequivocal on the part where it states that any breach of the covenant can result to non-renewal of the contract. b. In the case of the company whose lease have expired and is now paying on a monthly basis, the Conveyancing Act 1919 so provides that where the original contract of lease has expired and it has not been renewed but the leases continue to occupy the same paying monthly rate, such contract of lease shall be deemed as a month to month basis where the lease is only entitled to the month over which it has paid rent. It cannot therefore demand continuity for a number of years without signing a new lease contract, which clearly states the number of years it should occupy the property. Therefore, such tenant can be asked to vacate the place upon notice at the end of the month for which it has paid rent. c. In the case of 3rd leases whose lease is for four years with an option to renew for another two years, the Conveyancing Act of 1919 in relation to the Real Property Act 1900, so states that lease exceeding 5 years including the option for renewal should be in writing and registered to be in full force under the law. Therefore, where the renewal of two years would bring the total lease to 6 years, Oneproperty may contest such renewal since the lease was not registered as required. If one property would not want to renew the lease contract at the end of the remaining 8 months, it can validly do so under such argument. Question # 4 a. Eric shall have an interest over Emoh Ruo as a heir to the property since Yvonne transferred her share to Eric before she died. In the case of Polyak Estate; Amy v Permanent Trustee [1999] NSWSC 862 the court ruled that even the unsigned document which was identical to the contents of a handwritten document of the deceased was considered as his will. In our case, Yvonne signed a document transferring the share to Eric and gave him a written authority addressed to the bank to have it produce the certificate of title so that he might be registered as co-owner with Zarah. This should be regarded as her will at the time she died in accordance with Section 8A of the Conveyancing Act 1919 and interpreted in the case of Re Estate of Masters; Hill v Plummer (1994) 33 NSWLR 446. According to this case, “Every document which a person prepares or executes is, in the sense here relevant, intended by him to be something. It may, for example, be intended to be a letter, a personal memorandum, a draft of something to be prepared later, or a presently operative document. The section requires, of course, that the document to which it refers be of the latter kind. It must be intended that the document be presently operative and be operative as `a will.’ b. Yes. Zarah can prevent the completion of the sale to Fiona although she already expressly gave her consent to the bank with regards to the sale of the property, as she did not make any moves to prevent the sale thereof upon receipt of the notice two weeks prior to the sale. As the owner of the property in question, Zarah may exercise her right of redemption of the property as provided for under the Conveyancing Act 1919. Section 93 of said law so provide that a mortgagor is entitled to redeem the mortgaged property. c. Where Fiona already registered the property under name, Zarah can still seek for the setting aside thereof on the grounds mentioned under Section 93 of the Conveyancing Act which allowed for a redemption of the property. d. Yes, the easement is enforceable against Fiona. According to section 45 of Conveyancing Act 1919, A conyenance of a freehold land to the use that any person may have, for an estate or interest not exceeding in duration the estate conveyed in the land, any easement, profit a prendre, right, liberty, or privilege in or over or with respect to that lans, or any part thereof, shall operate to vest in possession in that person that easement, profit a prendre, right, liberty, or privilege for the estate or interest expressed to be limited to him or her; and the person, deriving title under him or her, shall have, use, and enjoy the same accordingly.” Furthermore, Section 45A of the Conveyancing law so states that “in a conveyance of land a reservation of any easement, profit a prendre, right, liberty, privilege not exceeding in duration the estate conveyed in the land, shall operate without any execution of the conveyance by the grantee of the land out of which the reservation is made, or any regrant by the grantee so as to create the easement, profit a prendre, right, liberty or privilege and so as to vest the same in possession in the person (whether being the grantor or not) for whose benefit the reservation is made.” Even if she changes contract, where the easement was registered and enforceable upon prior owners thereof, it will also be enforceable upon subsequent owners in this case Fiona. e. If Fiona becomes the register owner of the property, she is still bound by the easement provisions of the property. She may not be afforded more rights that those accruing to the previous owners thereof. Bibliography 1. NSW Legislative Council Hansard REAL PROPERTY (TORRENS ASSURANCE FUND) AMENDMENT BILL http://www.parliament.nsw.gov.au/prod/parlment/hansart.nsf/V3Key/LC19921125032 2. Conveyancing Act 1919 3. Real Property Act 1900 4. http://www.lawlink.nsw.gov.au/lrc.nsf/pages/digest.067 5. Gilbert J MacCaul (Aust) Pty. Ltd v Pit Clud limited (1959) 59 SR (NSW) 6. Flagstaff v Cross Street (1999) NSWSC 999 7. Estate of Masters; Hill v Plummer (1994) 33 NSWLR 446 8. Polyak Estate; Amy v Permanent Trustee [1999] NSWSC 862 9. Will for Persons Lacking will-making capacity February 1992 http://www.lawlink.nsw.gov.au/lrc.nsf/pages/digest.067 10. Perpetual Trustee Co Ltd v Fairlie Cunninghame (1993) 32 NSWLR 377 Read More