3015LAW Lecture Notes - Lecture 5: Equitable Interest, Constructive Notice, Indonesian Rupiah
1. UNREGISTERED INTERESTS AND PRIORITES
Registered vs unregistered
- Registered interest = legal interest (s 181 LTA)
- Unregistered interest = equitable interest (common law)
oMay amount to legal interest (short lease) or something less (mere equity)
Types of unregistered interest
- Unregistered interests in relation to land fall into one of two categories:
oan interest capable of being registered but which, for some reason, has not been
registered (eg interest of purchaser under completed contract of sale, interest of
a lessee where lease greater than three years, easement, mortgage, etc).
ointerest incapable of being registered (eg interest of beneficiary under a trust,
restrictive freehold covenant).
Vulnerability of Unregistered Interests
- Unregistered interests vulnerable in Torrens system of title. Why? = s 184(2)(a) LTA.
Registered proprietors do not have to enforce unregistered interest
Damages only option so just register it
- How to protect unregistered interests?
oregister the interest (if capable of registration).
olodge a caveat (or settlement notice where appropriate).
- Failure to lodge caveat – is that enough to find in favour interest holder?
Priority disputes
- Disputes involving competing claims to interests in land – inconsistent interests
Dispute between legal interest and equitable interest
Dispute between equitable interests
Dispute between equitable interest and mere equity
Legal Interest followed by Equitable Interest
Usually in favour of holder of legal interest unless:
- in general law, some postponing conduct by holder of legal interest (see, eg, Barry v
Heider)
oBarry RP fee simple estate. Two mortgages? Borrowed money from heider,
mortgage was unregistered. Equitable mortgage. Conduct of barry entered into
mortgage – estopped
oCHECK – needs to be some conduct of interest holder
oEg Certificate of title – legal property owner fails to secure certificate of title then
allowing other interest to claim
- under Torrens system, equity/in personam exception applicable against RP.
Equitable interest following be legal interest
1. Torrens: RP takes free of earlier unregistered/equitable interest, even if they had
actual or constructive notice of that earlier interest = ss 184(1) and 184(2)(a) of the
LTA.
2. General law/old system land (less relevant):
BFPFVWN takes free of earlier equitable claim.
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Unregistered interest = equitable interest (common law) Registered interest = legal interest (s 181 lta: may amount to legal interest (short lease) or something less (mere equity) Unregistered interests vulnerable in torrens system of title. Registered proprietors do not have to enforce unregistered interest. Damages only option so just register it. How to protect unregistered interests: register the interest (if capable of registration), lodge a caveat (or settlement notice where appropriate). Disputes involving competing claims to interests in land inconsistent interests. Dispute between legal interest and equitable interest. Dispute between equitable interest and mere equity. Usually in favour of holder of legal interest unless: in general law, some postponing conduct by holder of legal interest (see, eg, barry v. Equitable interest following be legal interest: torrens: rp takes free of earlier unregistered/equitable interest, even if they had actual or constructive notice of that earlier interest = ss 184(1) and 184(2)(a) of the. Lta: general law/old system land (less relevant):
