Purporting to act for both parties mr galaia forged a

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Purporting to act for both parties, Mr. Galaia forged a mortgage over CP’s land to Mrs S and registered it 2. Mrs S knew nothing of the fraud 3. Mrs S died and Mr S succeeded her as mortgagee 4. G fraudulently induced Mr S to execute a discharge of the mortgage, and registered it. 5. CP argued the mortgage was defeasible (argued the discharge was indefeasible), and S argued the discharge was defeasible, as well as wanting his mortgage to stand. 6. Could the relevant fraud be brought home to the RP (the party who gets benefit of instrument in both cases) or his agent? 7. If fraud is actually committed by the RP’s agent, the principle of respondeat superior applies (general principles of agency law). Acts of agent committed within his actual or apparent authority be brought home to the RP, even if the agent is acting fraudulently. Street J 8. Where the agent has knowledge of a fraud in the transaction and the agent is 27
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28 under a duty to communicate it to the principal, there is an irrebuttable presumption that the agent has communicated it. The agent’s knowledge of the fraud is imputed to the principal. Street J So, Galaia was acting as an agent for Mrs. Shultz. In this aspect, he did not meet the requirement of Street J’s first test. Her mortgage was therefore NOT defeasible, and her title was indefeasible. An example of this would be if asked to buy car and instead steal one. I won’t be liable for that person’s actions. Galaia’s second fraud was acting for Corwill Properties, as they’re the party who are the beneficial RPs. This is the discharge of mortgage part. He didn’t even have authority to this from Corwill, and thus no fraud for Corwill, so the discharge of the mortgage was indefeasible. THUS, Corwill have no mortgage. DEALING WITH A FRAUD PROBLEM INVOLVING AN AGENT 1. Who is acting as agent for the RP? Who’s RP is being impeached, and who’s acting for them. WRITE IT DOWN IF COME ACROSS IT!! 2. Has the agent committed a fraud? If so, was he acting within his actual or apparent authority (looking at the nature of the fraud)? If yes, RP is affected. 3. Did agent know of another party’s fraud in the transaction if this occurred? If so, was he under a duty to communicate it (Street J doesn’t give us a test as to when it arises, but if its heard in the form of the agent doing their job, then it’ll be relevant)? If yes, RP is deemed to know of it. AGC V DE JAGER 1. Mr. and Mrs. De Jager were JTs 2. Mrs De Jager’s signature on the mortgage to AGC was forged, husband was legit. 3. AGC’s employees allowed F to falsely attest her signature, even though he told them he’d not witnessed it, and then lodged the mortgage for registration. 4. This was held to be a fraud on the registrar (false representation) 5. AGC’s employees were acting within their actual or apparent authority 6.
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