Unregistered legal interests 1 most unregistered

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Unregistered legal interests 1. Most unregistered interests are equitable. 2. Legal interests normally require registration 3. Some legal interests can be created without registration: Parol leases taking effect in possession: s 52 PLA. Parol leases are oral, so they don’t need to be written, thus can’t be registered, but aren’t equitable either, so are legal??? Some types of easements Rights acquired by adverse possession These are enforceable as paramount interests under s 42(2) Caveat procedure 1. Person claiming an unregistered interest can lodge a caveat against dealings: s 89 2. Caveat is recorded on title and the RP is notified 3. RP can bring proceedings to have caveat removed, as there is no need to prove the existence of an interest when caveating: s 89A. 4. When an inconsistent dealing is lodged for registration, Registrar notifies caveator: s 90 5. Caveator has 30 days to withdraw caveat or commence legal proceedings to establish priority. Caveats commonly used to protect 1. Purchaser’s interest under a contract of sale 2. Interest of beneficiaries under a trust 3. Vendor’s lien for unpaid purchase monies 4. Mortgagee’s interest under unreg’d mortgage 5. Purchaser’s interest under an option to purchase Option to purchase – caveatable interest? 1. An agreement under which a person is granted the option to purchase the land within a specified period. Upon exercise of the option by the grantee, both parties are bound. 2. Irrevocable offer or conditional contract? 3. Before execution of option, does grantee have an equitable interest? Bahr v Nicolay 4. In Jacobs v Platt Nominees VCA held that an option is caveatable even before the option has been exercised 39
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40 The use and abuse of caveats 1. Must be in proper form and set out the nature of the interest being claimed and the extent of it, facts upon which the claims is based. 2. S 116 – liability in damages for lodgment of caveat without reasonable cause 3. S 91(2B) – caveat by second mortgagee won’t prevent proper sale by registered mortgagee Caveatable interest 1. S 89:Caveator must have an estate or interest in land (caveatable interest). 2. A claim based on a registerable instrument (eg mortgage) or a right to call for a registerable instrument (eg purchaser who has a specifically enforceable contract) is OK. 3. What about a claim to an unregisterable interest, eg a constructive trust? 4. Crompton v French : Harper J said any equitable interest will support a caveat. What is a ‘mere equity’ 1. ‘A right in equity that is ancillary to an interest in land and is binding on a third party who has notice of its existence or is a volunteer… A mere equity gives to a plaintiff a right to an adjustment of rights in relation to a specific property, but ranks lower than an equitable interest.’ 2.
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