State guarantee of title should be retained and a new statutory scheme should be introduced with greater focus on insurance principles.

Any person suffering compensable loss arising out of the operation of the Torrens system and its administration should be able to claim compensation directly from the Registrar-General by lodging a claim with the Land Titles Office.

Compensation should be available for losses (whether or not involving deprivation of land) arising out of the operation of the Torrens system which result from fraud, negligence, the bringing of land under the Real Property Act, errors in the Register, and errors and loss of documents in the Land Titles Office.

A person with a compensable claim who is wholly responsible for the loss should not be able to recover compensation from the Registrar-General, but a person with a compensable claim should not be precluded from recovery where the loss is caused by the fraud or negligence of an agent.

Corporations whose administrators (directors and other officers in management) have knowingly performed unauthorised acts resulting in a compensable claim should be granted compensation in such a manner as to ensure that the administrators themselves do not benefit unfairly from compensation by virtue of their relationship with the company; for example, if the administrators who are fraudulent or negligent are shareholders of the company.

A person with a compensable claim may only bring an action to recover compensation against the Registrar-General if that person’s claim for compensation from the Registrar-General is rejected or the person refuses the Registrar-General’s offer of compensation.

A person suffering loss can (without lodging a compensation claim) bring an action for damages against another person responsible for the loss other than the Registrar-General. The Registrar-General must be notified of the commencement of the action. After being notified, the Registrar-General may intervene as a co-defendant in the action and join other co-defendants, or compensate the plaintiff. If compensation is paid to the plaintiff, the Registrar-General is subrogated to the plaintiff’s rights as in Recommendation 9.

A plaintiff who has obtained judgment in respect of loss against a wrongdoer where notice has not been given to the Registrar-General, or who has compromised proceedings against a wrongdoer without approval of the Registrar-General cannot claim compensation for that loss against the Registrar-General.

Recommendation 9

If the Registrar-General pays compensation to a person with a compensable claim, the Registrar-General is subrogated to that person’s rights and can recover the compensation from the person responsible for the loss or that person’s insurer, or where the wrongdoer is deceased or bankrupt or insolvent, against that person’s estate.

The limitation period runs from the time the compensable claim is lodged against the Registrar-General.

Where an insurer (such as a professional indemnity insurer who insures against loss caused by the dishonest or negligent acts of the insured) has paid compensation to the person suffering loss, the insurer should be unable to recover compensation from the Registrar-General.

Any person with a compensable claim should recover the amount of the loss he or she has suffered. This should be determined in accordance with ordinary rules as to quantum of damages and interest.

Apportionment of liability for the loss will occur between the parties responsible for the loss including apportionment of responsibility for the loss arising from contributory negligence or other fault of the person with the compensable claim.

Claims for compensation should be lodged with the Registrar-General within 1 year after the claimant is aware of the loss, with a discretion in the Registrar-General or the Court to extend this period. Proceedings to enforce such claims should be subject to the normal limitation period of 6 years.

Statutory authorities should be required to give notice of resumptions; the Registrar-General should be required to record them; and losses suffered as a result of reliance on the Register should be compensable, where the resumption has not been recorded.

Section 133(b) of the Real Property Act should be repealed.