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Two alternative rules 1 a gets only a defeasible

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TWO ALTERNATIVE RULES 1. A gets only a defeasible title (ie the register can be rectified to remove A’s title on the application of V), but B gets an indefeasible title. This is called deferred indefeasibility 2. A gets an indefeasible title. As soon as he registers without fraud, V’s title is irretrievably lost. V may get compensation from the assurance fund. This is immediate indefeasibilty 3. Note that under both rules, B gets indefeasible title on registration. IMMEDIATE INDEFEASIBILITY 1. Purchasers get high security of transaction, because protected against defeasibility for Invalidity in vendor’s (grantor’s) title, AND Invalidity in the instrument by which they themselves obtain registered title 2. Owners are at risk of losing their titles through a forgery or other invalid instrument. 21
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22 THE RULE CHANGE 1. For decades, deferred indefeasibility was assumed to be the rule Gibbs v Messer [1891] 1 AC 248 (PC) 2. PC preferred immediate indefeasibility in Frazer v Walker [1967] 1 AC 569 Gibbs v Messer was distinguished, not overruled 3. High Court follows Frazer v Walker in Breskvar v Wall (1971) 126 CLR 376 FRAZER V WALKER 1967 1. Mr and Mrs F were RPs of land. Mrs F arranged mortgage to the Radomskis. She forged his signature on the mortgage. Rs registered the mortgage without knowledge of the forgery. On default, Rs sold to Walker, who registered transfer without fraud. W sought possession of the land from Mr F. F counterclaimed for rectification of register to remove the mortgage and transfer. FRAZER V WALKER – PC DECISION 1. Once a void instrument is registered without fraud, RP (including a registered mortgagee) obtains an immediately indefeasible title. 2. This in no way denies the power of a court of equity to make an order against the RP in personam (see topic 5.2) 3. Distinguished Gibbs v Messer, effectively confining it to its facts. BRESKVAR V WALL 1971 1. Bs were RPs of land 2. As security for a loan, gave Petrie a signed transfer with transferee blank, and DCT 3. As agent for Wall, P fraudulently inserted W’s name as transferee and reg’d transfer At this point, Petrie has acted fraudulently, but the registration has been done, HOWEVER, this is defeasible. What if he’d been an innocent transferee? This is volunteer exception stuff that we’ll discuss later. 4. Wall then sold to Alban Pty Ltd, a BFP (bona fide purchaser) 5. Alban was unable to register because the Bs lodged a caveat. This was lodged BEFORE Alban could register their title. Under either immediate or deferred, if Alban HAD got registered, they’d get the property. BRESKVAR V WALL - HCA 1. HCA unanimously followed Frazer v Walker 2. Registration of a void instrument confers a title which is effective. 3.
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TWO ALTERNATIVE RULES 1 A gets only a defeasible title ie...

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