TABLE OF CONTENTS Torrens Title: Unregistered Interests Under Torrens System... 3 Characterising unregistered interests... 3 The operation of caveats... 4 The distinction between unregistered legal and equitable interest... 6 Unregistered Leases... 6 Equitable Leases... 6 The rules of priority between competing unregistered interests... 8 Postponing Conduct... 8 Torres Title I: Indefeasibility and Exceptions... 10 Essential Features of Torrens Title... 10 Indefeasibility of title... 12 Exceptions to indefeasibility... 14 Short-Term Tenancies... 16 Chapter 7: Mortgages... 18 Mortgages under Old System Title, the equity of redemption and foreclosure... 18 NOTE: Foreclosure is where the bank will keep the property, and can sell it until the property goes up. Foreclosure is when the mortgagor exchanges the debt for ownership of the property. They become the owner of the property.... 19 STEPS TO FORECLOSE: Page 186 Moore Text... 19 1. Default [Fails to meet obligations of the mortgage]... 19 2. Notice to Remedy default within one month: Section 57 RPA and Section 111 of Conveyancing Act. 19 3. Failure to comply with notice to remedy default.... 19 4. Property conducted auction.... 19 5. Highest bid is less than the debt owed.... 19 6. Application for Foreclosure to registrar general or the Court... 19 7. Further period given to mortgagor to repay... 19 8. Order for Foreclosure made absolute... 19 Remedies available to the mortgagee... 20 Priorities between mortgagees where there have been further advances... 23 If M1 grants future advances M2 will not take priority unless M1 had notice (Hopkinsons v Rolt)... 23 If M1 has an agreement to provide advances M1 will be able to tack even if there is constructive notice (Re O Byrne s Estate)... 23 Under Torrens title you need actual notice (Westpac v Adelaide Bank).... 23 Under Old System title any notice will suffice even constructive to prevent you from tacking (Credland v Potter).... 23 1
Also if it is against conscious i.e. if M2 could not recover but for M1 s M3 then you can tack (Matzner v Clyde)... 23 Chapter 12: Easements and Profits... 24 Introduction... 24 Easements... 24 A... 25 Chapter 9: Easements... 30 Characteristics of an Easement... 30 EASEMENT EXAMPLES + CASES (More examples on page 245)... 30 Characteristics of an Easement... 31 Creating an Easement... 32 Changing the user of an easement... 35 Extinguishing an Easement... 35 Remedies... 36 Covenants... 37 Chapters 10: Positive Covenants... 37 The Nature of a Positive Covenant... 37 A positive covenant as part of an easement... 37 Enforceability of Positive Covenants by successors in title to the original covenantee... 38 Chapter 11: Restrictive Covenants... 39 The Nature of a Restrictive Covenant... 39 Schemes of Development... 41 Restrictive Covenants under Torrens Title... 41 Extinguishment of restrictive covenants... 42 TOPIC: LEASES Chapter 8: Leases... 43 The Characteristics of a lease... 43 Covenants in Leases... 45 Assignment and subleasing... 46 Termination and Relief Against Forfeiture... 49 2
TOPIC: EASEMENTS CHAPTER 12: EASEMENTS AND PROFITS INTRODUCTION Easements and profits are sets of limited rights that non-occupiers of land holder over land occupied by someone else. They are in the class of subsidiary (less) interests that burden, or restrict, the full use of the land of an owner. EASEMENTS General Easements are one of a class of interests in land known as incorporeal hereditaments. This term captures two features of easements: 1. They are classified as incorporeal because they are regarded as conferring rights over the land than rights to the physical land itself; and 2. They are heritable, as they are forms of real property. a right issuing out of a thing corporate, whether real or personal, or concerning or annexed to, or exercisable within, the same. It is not the thing corporate itself, which may consist in lands, house, jewels, or the like; but something collateral thereto, as a rent issuing out of those lands or houses The most common form of easement is the right of way, although, as we will see later, the term has a wider range. For the creation of a valid easement, there are both substantive and formal requirements. As such, easements have substantive requirements, and may be formally created in a variety of ways. Easements can be created by: v Express reservations; v Approved plan of subdivision under s 88B of the Conveyancing Act 1919 (NSW) 2 ; v An implied grant or reservation; and v Acquisition by long user or prescription. Easements may also be granted by the Supreme Court under s88k of the Conveyancing Act and by the Land and Environment Court under s 40 of the Land and Environment Court Act 1979 (NSW) 3. Substantive requirements for the creation of an easement 2 Conveyancing Act 1919 (NSW). 3 Land and Environment Court Act 1979 (NSW). 24
There are four basic requirements for the creation of an easement. This proposition comes from Re Ellenborough Park 4 : I. There must be a dominant and a servient tenement (dwelling); II. The easement must accommodate the dominant tenement; III. The dominant and servient tenements must not be held and occupied by the same person; and IV. The right must be capable of forming the subject matter of a grant. ELEMENT I There must be a dominant and a servient tenement An easement must operate for the advantage of one property, and to the disadvantage of another. The advantaged property is known as the dominant tenement ; and the disadvantaged is described as the servient tenement. The dominant tenement has the benefit of the easement, while the servient tenement bears the burden. If A Grants B the right to pass over her land to reach the road, A s land is the servient and B s land is the dominant. It is not possible to have an easement which benefits a person, without also benefiting the land; the easement must be annexed to the land appurtenant to the dominant tenement. Thus, it is not possible to have an easement which does not benefit a dominant tenement. tenement is known as an easement in gross. An easement which is not appurtenant to a dominant By s 88A of the Conveyancing Act, easements in gross are permitted in favour of the Crown, a public or local authority, or where, the easement is for the supply of a utility service to the public. This provision applies to both old system and Torrens title land. ELEMENT II The easement must accommodate the dominant tenement 4 Re Ellenborough [1956] Ch 131. 25
TOPIC: TORRENS TITLE Real Property TORRENS TITLE: UNREGISTERED INTERESTS UNDER TORRENS SYSTEM Notwithstanding the centrality of the Register and title by registration there is a place for unregistered interests. Priority between unregistered interests is a question of concern. CHARACTERISING UNREGISTERED INTERESTS Priorities under Old System Title and priorities between competing unregistered interests under Torrens Title, involve an identification of whether interests are legal or equitable. An interest classified as legal under Old System, will not be so classified under Torrens system. An interest, which is classified as equitable under Old System will not necessarily be equitable under Torrens. Both systems establish differences which must be understood. Notice of an earlier interest always defeats the holder of a later interest Where the later of two unregistered interests under Torrens had actual, constructive or imputed notice of the earlier interest at the time the later was acquired, then the later interest will be subject to that earlier interest. Discussion of the meaning of actual, constructive or imputed are under the heading Meaning of notice. Competing unregistered legal interests Assuming that the holder of the later interest had no actual, constructive or imputed notice of an earlier interest, and assuming there has been no disentitling conduct on part of the person who has the earlier legal interest, priority goes to the person holding the earlier legal interest (a person cannot convey an interest which he or she does not have). Those assumptions are often referred to as the equities are equal. Competing unregistered equitable interests Assuming the equities are equal, priority is based on time, by reason of the equitable maxim. The court is obliged to identify the best equity: Heid v Reliance Finance Corporations Pty Limited (1983) 154 CLR 326. In Heid, Mason and Deane JJ, expressed the view that: It was always necessary to characterise the conduct of the holder of the earlier interest in order to determine whether, in all the circumstances that conduct is such that is fairness and in justice, the earlier interest should be postponed to the later interest. The law in relation to what is postponing conduct and in relation to better equity is further discussed below under Postponing conduct. Competition between a legal and an equitable interest The applicable rule, assuming the equities are equal, is that where the equities are equal, the law prevails: Pilcher v Rawlins (1872) LR 7 Ch App 259. In competition between legal interest taken without notice of an earlier interest, and a later created equitable interest in the same land, the legal interest prevails. In a competition between an earlier equitable interest and a later legal interest, the legal interest prevails if it has been acquired by a purchaser: For value; In good faith (bona fide); 3