The Seinfeld Question (2007 Exam Q 1)

Roger was the RP of land held under the Land Titles Act 1980. On 1 May 2001, Roger entered into a written agreement to lease the land to Newman for 3 years with an option to renew the lease for a further three years. The lease was not registered. On 1 November 2001, Roger entered into a contract to sell the land to Jerry. The contract of sale acknowledged the agreement of 1 May 2001. Jerry was registered as proprietor on December 10, 2001. On 3 January 2002, Jerry executed a mortgage over the land in favour of his best friend, Elaine, to secure a loan of $60,000. Jerry was unable to give the certificate of title to Elaine, but promised to do when he could find it. Because of this, the mortgage has never been registered. While helping Jerry to locate the certificate of title, Brad (Jerrys cousin) found it. Brad then proceeded to use the certificate of title and forged a memorandum of transfer to sell the land to Kramer for $200,000. Jerry is unaware of this. The forged documents include express notification that Kramer will acknowledge the interest of Newman and that Kramer would ensure that a formal lease would be executed and registered. Instead of registering title, Kramer uses the documentation to sell the property to George for $230,000. George now has physical possession of the certificate of title, a transfer to him, the contract of sale from Kramer to him, the forged contract and transfer from Jerry to Kramer. George is about to proceed with registration when these facts come to light. Identify all interests and how they could be enforced.

PRIORITIES PROBLEM SOLVING 1. 2. 3. 4. 5. 6. Determine whether the law is general law or Torrens title; What are the relevant legislative principles? (i.e. LTA provisions) State the interests that each party has; Consider where those interests sit within the hierarchy of interests; Determine the applicable legal test to be applied; (eg. Reg v unreg; unreg v unreg) Identify the relevant elements within that legal test; (eg. Prima facie rule, exceptions) 7. Identify and discuss the facts of the question, using decided authority to support your submission. a. Consider specific facts such as the role of the caveat, the retention of title documents or any other factors that may lead to postponing conduct of the 1st interest holder (1st IH). b. Does the 2nd IH have notice?