INTRODUCTION

3.1 This chapter will examine three separate issues. They are:

• recent changes to the law relating to the Assurance Fund since the publication of the Issues Paper;
• the significance of immediate indefeasibility for the Assurance Fund;
• the relevance of these developments to the question of reform.

RECENT CHANGES TO THE LAW

3.2 In the comparatively short time since the Issues Paper was published the law relating to the Assurance Fund has undergone a number of significant changes. These changes have had a marked impact on the principles outlined in Chapter 2. They can be usefully split into two separate categories, case law and statutory reform.

Recent case law on the Assurance Fund provisions

Termination of liability for some defendants: s 126(2) and s 126(3)

3.3 In paragraph 2.9 the serious problems facing plaintiffs who have been defrauded of their land under s 126 were outlined, largely as a result of the High Court decision in Franzon.¹ This very question as to who is the appropriate person to sue under the combined effect of s 126(2) and s 126(3) in New South Wales arose for consideration by the High Court in 1993 in Saade v Registrar-General.² In Franzon, the analogous provisions in Western Australia had been interpreted by the High Court as denying a remedy because the person responsible could not be held to have made an erroneous registration. In Saade v Registrar-General, Mrs Saade was the registered proprietor as joint tenant with her husband of the matrimonial home. Mr Saade forged his wife’s signature to a memorandum of transfer in favour of Mr Khoury, the second respondent who was a party to the fraud. At trial, Justice Powell found that Mrs Saade was estopped from asserting her rights against Mr Khoury because she withdrew a caveat previously lodged against his newly acquired title. However, Justice Powell entered judgment against the Registrar-General in the sum of $53,000, assessed as the loss suffered by Mrs Saade. The New South Wales Court of Appeal upheld an appeal by the Registrar-General rejecting liability under either s 126 or s 127.

3.4 The High Court unanimously upheld the appeal. In particular, the Court held that s 126(3) applied to paragraph (b) of s 126(2), reasoning that:

The purpose of subs (3) is to identify the person upon whose application the certificate was issued to the transferee. It operates in every case in which “the fraud, error, omission or misdescription occurs upon a transfer for value”. The litany “fraud, error, omission or misdescription” appears of course in section 126(2)(c) and it may be thought that subs (3) is correspondingly limited in its operation. But that cannot be so since para (c) is concerned with action against the person “who acquired title to the land”. It is of no relevance to para (c) to identify the person upon whose application the transfer was registered. That identification is relevant only in the context of para (b) of subs (2).³

Insofar as paragraph (c) refers to persons “who acquired title to the land” the Court held that it applied to Mr Khoury in this case. Paragraph (b), by contrast, could only apply to Mr Saade in light of subsection (3). However, in order to establish liability on the part of Mr Saade, the appellant still needed to establish that the transaction was an “erroneous registration”. It was on this point that the Court was faced with the contrary authority of Franzon. As noted above, this case decided that where a third party forges the signature of a registered proprietor of land to a mortgage and the innocent mortgagee becomes registered, there is no “erroneous registration” for the reason that there is “no disconformity between the registration and the instrument on which it was based and which was the foundation of the application.”⁴ Despite this, the Court distinguished Franzon in Saade on the basis that the New South Wales provision was materially different from its counterpart in the Western Australian statute. In particular, the Court pointed to the fact that there was no provision like subsection (3) in Western Australia. Moreover, it held that the fact that in the New South Wales statute subsection (3) was limited in its operation to paragraph (2)(b) - that is, it only applied to persons “upon whose application” erroneous applications are made. This was said to indicate that the term had a different meaning:

Clearly the subsection [(3)] fastens on to the transferor as the person to answer that description, in the circumstances to which it refers. And it does so in order to widen the category of persons against whom the statutory cause of action will lie ... In the context of the Act, “erroneous registration” can be seen as a shorthand expression intended to cover the elements in s 126(1) which give rise to a cause of action.⁵

3.5 The judgment had a further, purposive colouring. It also held that if the phrase were not interpreted in this way “there would indeed be ... the lack of an essential protection to persons who are defrauded”.⁶ This decision is to be welcomed insofar as it has clearly resolved some of the difficulties associated with reconciling some of the constituent parts of this section and has removed from New South Wales law the restrictive influence of Franzon for defrauded plaintiffs noted above.⁷ To this extent it has given welcome expression to the insurance principles of the Act and has belatedly answered the criticisms of a number of commentators who have felt that the Act’s already limited insurance provisions have all too often suffered further reduction in the hands of the judiciary.⁸ In doing so the High Court answered the complaint of Justice Needham in Armour v Penrith Projects Pty Ltd⁹ who concluded that the Act “lacks essential protection to persons who are defrauded in their interests in registered land being taken from them by forgery”.¹⁰ However, although it resolves the serious problems concerning fraud, the case raises some other difficulties.

3.6 For instance, it appears to follow from Saade that a defrauded person in similar circumstances has a choice either to seek compensation from the Registrar-General or to attempt to get possession of his or her property back from the presently registered but fraudulent proprietor. This would appear to be a direct consequence of Justice Powell’s holding at first instance in this case that Mrs Saade had effectively waived her remedies against Mr Khoury by withdrawing her caveat, and her ultimate success before the High Court.¹¹ This case therefore seems to have afforded persons who are deprived of an interest in land a significantly wider choice of parties to proceed against. This would appear to be at odds with at least one of the policies behind the Assurance Fund’s provisions: that where the land can be recovered from wrongdoers, the question of compensation should be irrelevant. Given that Mr Khoury seems to have been tainted by the fraud and therefore failed to get an indefeasible title, there should be some clear obligation on the defrauded party to seek to dislodge him from the register. If it is now possible to waive one’s rights against such persons and still get compensation, then the Registrar-General (and this means ultimately all those who contribute to the fund) will foot the bill.

3.7 It may be argued against this that the Registrar-General retains a right of subrogation under s 128(2) to the rights and remedies of the plaintiff who has received payment of damages from the fund “against any person who was wholly or partly responsible for the loss”. Obviously, this includes Mr Saade in this case. But if he is out of the jurisdiction, or bankrupt, can the Registrar-General proceed against Mr Khoury? In most circumstances, this avenue of redress would be available as a straightforward mechanism for recouping damages. However, if those rights have been waived, as they were held to have been at first instance in this case, it is difficult to see that there exist any longer “rights and remedies of the plaintiff” enforceable against “any person who was wholly or partly responsible for the loss”, as s 128(2) requires. In which case there would appear to be nothing to which the Registrar-General could be subrogated. This seems to be the worst of all possibilities in terms of equity and efficiency namely, that the Fund pays compensation in respect of a fraud concerning which it has no independent right of action. In the meantime one of the defrauding parties remains, indefeasibly so, on the register. There is little doubt that it would have been a tragedy for the appellant to have failed to secure any redress in a case such as this. Likewise, it would have been an indictment of the provisions of the Act if no remedy were available to cover a situation like this. But the consequences seem to be unsatisfactory given the difficulties faced by the Registrar-General in relation to subrogation. Clearly, this too needs to be resolved in any ultimate reform package.

3.8 Equally, too much should not be made of the apparent expansion of remedies afforded by this decision. While the case expands the rights of plaintiffs under s 126 and, as the Court pointed out, it now removes “the lack of essential protection to persons who are defrauded”,¹² its net effect is merely to locate a right in s 126 which was in any event available under s 127 after Franzon. This is because if there is no erroneous registration where a forged document is registered in the normal way, there is no “applicable” remedy under s 126. Accordingly, s 127 would be available as a basis for compensation. This has been recognised by the Registrar-General in the context of Mayer v Coe.¹³ This interpretation represented a great boon for this particular appellant, but its overall significance in the scheme of the compensation provisions is rather small when it is recognised that victims in the same position as Franzon, Mayer and Armour would all have s 127 remedies. It is easy to say this in hindsight, especially in light of a very obscurely worded set of provisions, but the real problem for the plaintiffs in these cases was not that there was no remedy available to them but that they sought redress under the wrong section. It is the Commission’s view that it is preferable if there is simply one identifiable party against whom a person deprived of land may proceed. This would avoid the present problem of selecting the right defendant, and in the case of the Registrar-General, selecting the correct head of liability.

“Error or Omission” - Trieste and Dempster limited

3.9 As seen above, the majority in Trieste took the view that error or omission did not extend to matters which the Registrar-General failed to note on the register where, according to the view of the Court, the Registrar-General did not have the power to note those matters. However, this ruling has been limited in effect by a recent decision of the Supreme Court. In Voudouris v Registrar-General,¹⁴ Justice Hodgson took a generous view of what fell within the expression “error, omission, or misdescription in the Register”.¹⁵ The plaintiffs, Mr and Mrs Voudouris, had purchased a house at a public auction for development as a dual occupancy. The copy certificate of title, which the plaintiffs relied on, disclosed the area as being 1,000 sq m. A copy of the deposited plan attached to the contract showed a similar measurement. The deposited plan contained a certificate by a registered surveyor that the survey represented on the plan was accurate. In fact, the area was misstated and was actually only 795.6 sq m. The error was purely one of calculation: the lengths and boundaries were correctly set out on the Register, but the area shown was greater than the area which a correct calculation based on the correct boundary lengths and directions would have shown.¹⁶ The plaintiffs stated that they would not have purchased the property if they had known it was only about 800 sq m.

3.10 The plaintiffs first argued that to maintain a certificate of title stating an incorrect area was a mistake of the Registrar-General within s 127(1). It was also argued that the Registrar-General could not avoid this by pointing to the error of the surveyor who prepared the deposited plan where the error could be shown by calculations based on the survey itself without having to inspect the land physically. Justice Hodgson stated that Dempster’s case, on which the Registrar-General relied, might be distinguishable on the basis that:

the error or misdescription there did not appear from matters recorded on the title itself, but depended upon matters which could only be ascertained by measurements or surveys undertaken at the site. In the present case, the error was purely one of calculation: the lengths and directions of boundaries were correctly set out on the Register, but the area shown was greater than the area which a correct calculation based on the boundary lengths and directions would have yielded.¹⁷

However, he went on to hold that it was open to the Registrar-General to be satisfied by the surveyor’s certificate, and that to do so was not a mistake.

3.11 The next issue was whether there was “any error, omission, or misdescription in the Register” within the meaning of s 127(1).¹⁸ Justice Hodgson referred to Trieste’s case, which seemed to support a narrow interpretation of this phrase, denying its application to the omission of something which the Registrar-General was not authorised to record under the RPA (although, as mentioned in paragraph 2.51 above, the Court in Trieste’s case failed to take note of an amendment which gave the Registrar-General the power to record statutory vesting on receipt of an application to do so). Justice Hodgson distinguished Trieste’s case on the basis that it:

concerned a matter which could not, under the legislation as it then existed, be noted on the Register at all; and it was this that the majority relied on in reaching their conclusion that there was no error, omission or misdescription in the Register. In the present case, undoubtedly the correct area could have been stated on the Register, and I see no basis for saying that there is no error in the Register, simply because the error is one for which a surveyor was responsible rather than the Registrar-General. Thus, I do not think Trieste is in point.¹⁹

3.12 As this case demonstrates, it is a fine distinction which separates this decision from those in Trieste and Dempster. In Dempster,²⁰ an error of the surveyor was involved and the Recorder of Titles relied on the survey, as the Recorder did in the Voudouris case. The only discernible factual difference is that the first case involved a measurement of frontage, while the second involved one of area; so that in the first situation, the true measurements could only be determined by a physical survey unlike the second which simply required an arithmetic calculation of area from the certificate. However, a different result was reached through the different wording of s 127, including making its remedies available when other remedies were “inapplicable”; whereas in Dempster, the relevant remedies were available only when other remedies were “barred”.

3.13 It is clear in both cases that there was a factual misstatement in the Register, and, as noted above in Voudouris, Justice Hodgson observed that there was no basis for saying there was no error in the Register merely because a surveyor rather than the Registrar-General was responsible.²¹ This view clearly supports the need for the third category in s 127 to be available for purely factual errors.

3.14 This accords with the minority judgment in Trieste’s case:

As to the third category, it seems to me that it is completely divorced from any breach of duty. Otherwise it would add nothing to the first category. In my opinion the legislature intended it to deal with the factual situation existing at the relevant time. This is the natural meaning of the words and, given that meaning, they provide a remedy in respect of a situation obviously likely to occur, and which equally obviously could cause serious damage to an innocent purchaser.²²

Statutory reform

Registrar-General’s power to settle actions

3.15 The recent amendments to the compensation provisions enable the Registrar-General to settle claims against him or her as nominal defendant directly without the plaintiff having to commence an action. The main terms of these amendments are as follows:

Registrar-General may settle claims

129 (1) The Registrar-General may settle a claim for damages made against the Registrar-General under section 96I or Part 14, whether or not the person making the claim has commenced an action to enforce the claim.

(2) The power of the Registrar-General to settle a claim is subject to the following restrictions:


(a) a claim must not be settled unless the Registrar-General is satisfied that the claimant would be successful in an action to enforce the claim or that it is reasonable in all the circumstances of the case to settle the claim;

(b) the amount to be paid in settlement of the claim must not exceed $100,000 (or such other amount as may be prescribed by the regulations) unless the Minister has approved of the settlement.


(3) In settling a claim, the Registrar-General may pay such amount as the Registrar-General thinks reasonable. The amount may include any costs of action incurred by the claimant before the settlement.

3.16 Section 96I gives a person who, in respect of a transaction involving land, relies on the accuracy of an official search which is incorrect, the right to bring a damages action against the Registrar-General to recover his or her losses. The damages recovered are paid out of the Fund. If the person suffering loss instructs a solicitor or licensed conveyancer, who relies on the official search, the person has no right of action against the solicitor or licensed conveyancer for any loss or damage suffered as a result of an inaccuracy in the official search. In the latter situation, the person suffering loss (if not more than $100,000) would presumably claim against the Registrar-General who would then be subrogated to the rights of the person suffering loss against any other person responsible.

3.17 It should be noted that the availability of the section is confined to the case where the Registrar-General is satisfied that the claimant would be successful in the action to enforce the claim or, that it is reasonable in all the circumstances of the case to settle the claim. The amount of settlement cannot exceed $100,000 without the Minister’s approval.

3.18 Part 14 of the RPA deals with civil rights and remedies in the RPA. Sections 121-123A contain the machinery for the settlement of disputes as to the propriety of official acts by the Registrar-General. While the amendments are to be applauded, the terms of their operation still leave the compensation provisions short of achieving the insurance principle. As was seen in Chapter 2, s 126 does not relieve a wrongdoer from the consequences of his or her liability. Actions against the wrongdoer still need to be pursued fruitlessly under the terms of s 126, before resort can be made to s 129 which embodies the recent amendments. The section is only directly available if s 126 is inapplicable and the other heads of recovery in s 127 apply. Recovery directly against the Registrar-General is also dependent on certain conditions. For example, s 129(2)(a) states that the Registrar-General can only settle a claim if he or she is satisfied that an action for recovery of damages against the Registrar-General would be successful. Presumably, in such a case prior to the amendments, the Registrar-General’s legal advisers would have suggested settlement of the claim in any event, and it would appear that this particular amendment was directed to formalising that power, and making it available before an action needed to be commenced.

3.19 Under s 129(2)(a) the Registrar-General also has the power to settle the claim if he or she is satisfied “that it is reasonable in all the circumstances of the case to settle the claim”. This would seem to include cases where the Registrar-General is satisfied that there would not be reasonable prospects of a successful action against him or her and is a more generous basis of recovery for this reason. However, it is not clear from the terms of the legislation exactly what is reasonable, and no guidance is given to claimants in respect of this. Finally, under s 129(3) the amount of damages payable is qualified by whatever the Registrar-General thinks is reasonable, and again, no guidance is given by the statute as to what this means. The Registrar-General also has subrogation rights against the wrongdoer or a professional indemnity insurer by virtue of s 129(5), which deems a payment under s 129 to be a payment of damages in accordance with a judgment for the plaintiff, and the claimant is taken to be the plaintiff.

Subrogation rights against the Registrar-General

3.20 Section 128 was recently introduced into the RPA to prevent “professional indemnity insurers” (who are liable to indemnify persons who suffer from loss as a result of the wilful default, negligence or fraud of professionals or technical experts in carrying out their business) or the person responsible for the loss, from bringing an action against the Registrar-General to recover the compensation paid by them to the plaintiff. The section took effect from 19 March 1992 and overrides any contrary law or agreement to the contrary.²³

EFFECT OF IMMEDIATE INDEFEASIBILITY

General impact of immediate indefeasibility on Assurance Fund

3.21 Paragraph 3.11 of Issues Paper 6 stated:

... in certain circumstances the effect of immediate indefeasibility may be that a person who has lost an interest in land as the result of registration of a void instrument can be left in the unenviable position of both losing title to, or an interest in, land and being precluded from the assurance fund.²⁴

3.22 The Registrar-General disagreed with this proposition and the statement in paragraph 3.10 of the Issues Paper that the compensation provisions should be revised to take into account the judicial acceptance of the theory of “immediate indefeasibility”.²⁵ Prior to the case of Frazer v Walker²⁶ in 1967, there was a substantial body of conflicting authority on whether the theory of immediate indefeasibility or the theory of deferred indefeasibility was embraced by the Torrens system. Under the doctrine of deferred indefeasibility, a person (A) registering an instrument which is void on general law principles can have his or her title set aside by the true owner (B), even if A has acted without fraud. B could not however attack the title of a third person (C) who purchases in good faith from A and registers an instrument executed by A. Indefeasibility is thus “deferred” to a subsequent purchaser, C in this case.²⁷ The doctrine of immediate indefeasibility by contrast, confers a good title on A immediately A obtains registration of a transfer (or other instrument), regardless of its invalidity. Thus, if A who has acted without fraud and given valuable consideration registers a forged transfer, A is entitled to protection against action by the previous registered proprietor (B) whose signature to the transfer was forged.

3.23 The facts in the case of Frazer v Walker were as follows. Mrs Frazer forged her husband’s signature to a mortgage of their jointly-owned property in favour of Radomski (person A on the above analysis). Mrs Frazer failed to make payments under the mortgage. Radomski, the registered mortgagee, exercised power of sale and transferred the land to Walker (person C, on the above analysis). Walker duly registered the transfer. When Walker attempted to claim possession of the land, Mr Frazer (person B on the above analysis) claimed the mortgage to Radomski was a nullity due to his wife’s forgery, and asked that the entries in the Register recording the mortgage to Radomski and the interest of Walker be cancelled. The dispute was thus essentially between Mr Frazer (B) and Walker (C). Walker was one transaction away from the invalid document (the forged mortgage to Radomski) and thus, even on the deferred indefeasibility theory would have had the overriding title, being a registered proprietor untainted by Mrs Frazer’s fraud. The Privy Council therefore did not strictly have to decide on the conflict between deferred and immediate indefeasibility, but nevertheless, went out of its way to do so. It held that Radomski had an indefeasible title on registration, and the fact that the mortgage document was void at common law did not affect the indefeasibility of Radomski’s title.

3.24 One obvious result of this decision is that there is at least a theoretical possibility of a vastly increased number of claims on the fund. Where deferred indefeasibility prevails, the former proprietor is able to get his or her land back, and so will not be a claimant. The victim then becomes the transferee under the void instrument.²⁸ However, because they have never had an interest in the land, they are not able to claim against the Assurance Fund. So, for example, in Saade’s case, under the principle of deferred indefeasibility, Mrs Saade would have been able to regain her interest in the land, even if Mr Khoury had been completely innocent. Moreover, he would not be able to claim from the Fund. As we have seen, under the present immediate indefeasibility regime Mrs Saade would lose her interest but receive compensation from the fund.

3.25 The adoption by the courts of immediate indefeasibility has led some authors to raise the question of whether some consequential adjustments to the compensation provisions are needed. Neave, Rossiter and Stone for instance, note that “[n]o attempt has been made to revise the legislation to take account of the theory of ‘immediate indefeasibility’ in place of the earlier theory of deferred indefeasibility”.²⁹

3.26 Another view is that no significant loss has occurred as a result of the acceptance of the theory of immediate indefeasibility if figures on a State basis are looked at.³⁰ The Registrar-General on the other hand has stated that there are cases (presumably involving immediate indefeasibility) pending where amounts paid from the Consolidated Fund will be sizeable.³¹ There is also one completed case, which involved a judgment of $559,279 (not including costs of the appeal etc) being awarded.³² In any event, significance of loss is a relative term and what may be a small loss to one plaintiff may be disastrous for another.³³ Appendix B also indicates that there have been at least 53 claims for loss resulting from fraud between 1975 and 1995 since the acceptance of the concept of immediate indefeasibility in 1967. However it is not apparent whether the loss related to these claims was necessarily due to immediate indefeasibility, as opposed to deferred indefeasibility. Overall the effect of immediate indefeasibility does not appear to have been significant.

The strengthened position of volunteers: Bogdanovic v Koteff

3.27 In Bogdanovic v Koteff³⁴ the Court of Appeal held that a registered volunteer obtained an immediately indefeasible title and was thereby not subject to a prior unregistered interest created by the previous registered proprietor. As the appellant, who was seeking to upset the title of the registered proprietor, could not point to anything in the RPA preserving her rights against the registered proprietor who took as a volunteer, s 42 operated so as to give Mr Koteff, the volunteer, an interest “absolutely free” from any estate or interest in Mrs Bogdanovic.

3.28 A number of authors have suggested that there are no compelling reasons why a volunteer should obtain the benefit of the paramountcy provision.³⁵ Indeed Whalan has suggested that the matter of whether a volunteer’s title should be indefeasible should be put to rest by a legislative provision withholding the benefit of indefeasibility from a volunteer.

3.29 In this context, one problem remains as a result of the decision in Bogdanovic v Koteff. The conclusion that a volunteer had an immediately indefeasible title (on the basis that this was the overall objective of the Act) was clearly at odds with the earlier decision of Justice Adam in King v Smail.³⁶ Justice Adam reasoned on the basis of repeated references in the Victorian Act to “purchasers for value” and the need to read the Act as a whole that the indefeasibility provisions considered as a whole suggested that volunteers ought not to be given the same protections as purchasers. The Victorian equivalent to s 135 was one such provision referred to. As a result of Bogdanovic v Koteff the curious position arises that volunteers would seem to get the protection of immediate indefeasibility under s 42, yet might still be liable to a claim for damages for the reason that they do not come within the ambit of s 135. This apparent result raises an acute problem analogous to that identified by Justice Mason in Franzon. That is, the need for persons who have an indefeasible title and who cannot therefore be removed from the register to be equally immune from claims for damages. After Bogdanovic volunteers would seem to be in precisely this invidious position. This would appear to be another reason for resolving this matter by statutory amendment.

RELEVANCE OF DEVELOPMENTS TO REFORM

3.30 As was seen in Chapter 2, the compensation provisions, contained in s 126 and 127 of the RPA and related sections, are not easy to interpret. Many authors have commented on their drafting:

Due to ungainly drafting, it is sometimes difficult to discern the separate functions of the sections which confer the above remedies. Particularly in regard to s 126 there have been frequent comments upon ill-drafting, and the late John Baalman commented: “The general impression created by the language of Part XIV is that the draftsman had reached a stage at which he was anxious to see the end of the difficult task”.³⁷

3.31 Similar views have been expressed in respect of the provisions which identify the defendants for the purposes of an action for damages under s 126:

As can be seen, except in Victoria, these provisions as to the correct person to sue are a tangled skein.³⁸

And in respect of s 126:

The drafting of s 126, although it has been on a number of occasions amended, leaves much to be desired. One would think in an Act of this kind, where such importance is placed upon the interests of the person whose name appears on the register, that the rights of persons whose interests have been detrimentally affected by error or criminal activity would be precisely spelt out. Unfortunately, the section raises a number of difficult questions of interpretation, and it seems to me to be in need of drastic revision.³⁹

The above mentioned statements indicate that the problem arises from the lack of clarity in the section, and that statutory revision is desirable.⁴⁰

3.32 Criticisms have been made of the interrelationship between s 126 and s 127 in the following terms:

It seems that the errors to which para (d) [ie, s 126(1)(d)] refers are also covered by s 127. That section provides an action for damages against the Registrar-General in cases in which the remedy provided by s 126 is inapplicable. Section 126(5) also provides an action against the Registrar-General when the direct remedy against an individual cannot be pursued. It is difficult to see the purpose in this apparent overlapping.⁴¹

3.33 Criticisms in respect of the failure of the provisions to accord with the insurance principle still apply in spite of recent amendments to the compensation provisions. The insurance principle, which we explained in Chapter 1, is encapsulated in the words of the South Australian Commission in 1873 when it inquired into this issue:

We are of the opinion that the person damnified ought to stand in the same relation to the assurance fund as an assured person does with regard to an assurance company with which he has effected an assurance. In the case of a holder of a policy against fire, it is not necessary for him to prosecute the person guilty of arson before recovering upon the policy; nor in the case of a life assurance need the holder of the policy prosecute a murderer who has caused the death of a person whose life is insured. The person damnified ought to be entitled to make his claim immediately against the Registrar-General, as representing the assurance fund, leaving that functionary to recover against the person who may have committed the fraud.⁴²

CONCLUSION

3.34 The limited scope for compensation under s 126 and 127 has resulted, to a large extent, from the poor drafting of the compensation provisions and, in the past, to the cautious approach of the Land Titles Office in awarding compensation. This previous approach is attributable to the ineffectiveness of the provisions to fulfil insurance principles and the difficulty in their administration. Finally, while it is true that s 127 of the RPA allows recovery of compensation for losses not involving deprivation of land, the scope of the section has been restricted by the court’s reluctance to attribute liability for certain errors to the Registrar-General and to award compensation in certain situations only if the Registrar-General’s error was the sole cause of the loss. The narrow interpretation accorded to the provisions justifies the need for their amendment to ensure that the compensation principle, discussed in Chapter 2, is properly fulfilled.

FOOTNOTES

1. Registrar of Titles (WA) v Franzon (1975) 132 CLR 611.

2. Saade v Registrar-General (1993) 179 CLR 58.

3. Saade v Registrar-General at 66.

4. Registrar of Titles (WA) v Franzon (1975) 132 CLR 611 at 619.

5. Saade v Registrar-General at 68.

6. Saade v Registrar-General at 68.

7. Paras 2.9-2.10.

8. M A Neave, C J Rossiter and M A Stone, Sackville and Neave Property Law: Cases and Materials (5th ed, Butterworths, Sydney, 1994) at 531; L A McCrimmon, “Compensation Provisions in Torrens Statutes: The Existing Structure and Provisions for Change” (1993) 67 Australian Law Journal 904; C. McKelvey, “Fraudulent Deprivation and the Assurance Fund” (1993) 25 Queensland Law Society Journal 133.

9. [1979] 1 NSWLR 98.

10. Armour v Penrith Projects Pty Ltd [1979] 1 NSWLR 98 at 102.

11. This fact was held to be fatal to her case before the Court of Appeal.

12. Saade at 66.

13. See para 2.40, above.

14. Voudouris v Registrar-General (1993) 30 NSWLR 195.

15. Voudouris at 200.

16. Voudouris at 200.

17. Voudouris at 200.

18. Voudouris at 199-200.

19. Voudouris at 200.

20. Dempster v Richardson (1930) 44 CLR 576 at 587.

21. Voudouris at 200.

22. Trieste Investments Pty Ltd v Watson (1963) 64 SR (NSW) 98 at 107.

23. For example, the Legal Profession Act 1987 (NSW) which permits the Fidelity Fund to be subrogated to the rights of the claimant.

24. See also Registrar-General, Submission (6 April 1990) para 23.

25. Registrar-General, Submission (6 April 1990) para 10.

26. Frazer v Walker [1967] 1 AC 569.

27. See, for example, Gibbs v Messer [1898] AC 248.

28. As noted above, this is the loss-shifting aspect of the priority rules.

29. Neave, Rossiter and Stone at 528.

30. Master Windeyer, Submission (28 August 1990) at 1.

31. Registrar-General, Submission (6 April 1990) at 8 para 23.

32. See Appendix B.

33. Master Windeyer, Submission (1 March 1990).

34. (1988) 12 NSWLR 472.

35. See A J Bradbrook, S V MacCallum and A P Moore, Australian Real Property Law (Law Book Company, Sydney, 1991) at [5.64]; and D J Whalan, The Torrens System in Australia (Law Book Company, Sydney, 1982) at 336.

36. [1958] VR 273.

37. R A Woodman and K Nettle, The Torrens System in New South Wales (Law Book Company, Sydney) at [121.3]. See also Price v Registrar-General (NSW Supreme Court, Windeyer J, 14 March 1996, ED 2985/95, unreported).

38. D J Whalan, The Torrens System in Australia (Law Book Company, Sydney, 1982) at 354.

39. Armour v Penrith Projects Pty Ltd [1979] 1 NSWLR 98 at 101.

40. Woodman and Nettle at [126.14].

41. Woodman and Nettle at [126.8].

42. South Australia, Report of Commission Appointed to Inquire into the Intestacy, Real Property, and Testamentary Causes Acts; Together with Minutes of Evidence and Appendix (Paper No. 30, 1873) XIV, quoted from R M Stein, Submission (10 August 1989) at 8; see also E L Piesse “Reform of the Torrens System” (1939) 11 Australian Law Journal 465 at 472.