Barry v Heider

Case [1914] HCA 79


19 CLR 197

I am practically in accord with the views of Cullen C.J. and Sly J., and agree that these appeals should be dismissed.

I would add that the offer voluntarily made to proceed to separate assessment in respect of the Livingstone House property and the residue property was very fair.

Appeals dismissed with costs. Solicitors, for the appellants, Bradley &Son. Solicitor, for the respondent, J. v. Tillett, Crown Solicitor for New South Wales.

mar COURT OF AUSTRALIA.] BARRY

HEIDER AND ANOTHER

RESPONDENTS. DEFENDANTS,

ON APPEAL FROM THE SUPREME COURT OF Land-Transfer obtained by fraud-Transfer not registered-Equitable interest

created by transferee-Mortgage-Rights of mortgagee - Caveat - Right of solicitor to withdraw --Attestation of instruments - Proof of instruments- Attestation by solicitor-Real Property Act 1900 (N.S. W.) (No. 25 of 1900), secs. 2 (4), 41, 72, 107, 108.* * The Real Property Act 1900 pro-

with the provisions of this Act, hereby repealed so far as regards their appli- Sec. 2 (4) All laws, Statutes,

cation to land under the provisions of Acts, ordinances, rules, regulations,

this Act, or the bringing of land under and practice whatsoever relating to

the operation of this Act." freehold and other interests in land

Sec. 41 (1) No instrument, until and operative on the first day of Janu-

registered in manner hereinbefore pre- ary one thousand eight hundred and

scribed, shall be effectual to pass any sixty-three are, so far as inconsistent

estate or interest in any land under

19 CLR 198

Notwithstanding the provisions of secs. 2 (4) and 41 of the Real Property Act 1900 an unregistered transfer of land confers upon the transferee an equitable claim or right to the land which is assignable by any appropriate means, and it also operates as a representation, addressed to any person into whose hands it may lawfully come without notice of any right of the trans- feror to have it set aside, that the transferee has such an assignable interest.

The proprietor of land had executed a transfer of it to S., which was not registered and which was voidable by him on the ground of fraud on the part of the transferee. S., to whom the transfer had been delivered, applied to H., who had no notice of the fraud, for a loan on the security of the land. He produced to H. the transfer, which purported to be duly executed and attested, together with an order from the transferor to the Registrar- General to deliver to H.'s solicitors the certificate of title which was lying in the Registrar-General's office. On the faith of these documents, and of an instrument of mortgage executed by S., H. made the loan.

Held, that H. was entitled as against the proprietor to a charge on the land in terms of mortgage.

Subsequently a caveat was lodged by a solicitor on behalf of the proprietor stating that the purchase money had not been paid. During the course of negotiations for a second mortgage by the…

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AGLC
Barry v Heider [1914] HCA 79
Case
[1914] HCA 79
Decision Date

CaseChat Overview and Summary

The case of Barry v Heider involved an appeal to the High Court of Australia concerning the validity of unregistered transfers and mortgages under the Real Property Act 1900 (NSW). The appellant, Barry, sought to have a transfer of his land to Schmidt declared void due to alleged fraud and non-payment of purchase money. However, Heider and Gale, who had advanced money to Schmidt on the security of mortgages over the land, intervened, claiming equitable interests.

The central legal issues before the court were whether an unregistered transfer of land under the Real Property Act 1900 could create an equitable interest in the transferee, and if so, whether such an interest was assignable and could be the basis for a valid mortgage. The court also considered the effect of sections 2(4) and 41 of the Act, which appeared to render unregistered instruments ineffectual to pass any estate or interest in land, and the requirements for the attestation and proof of instruments.

The court, in its reasoning, affirmed that despite the wording of section 41, an unregistered transfer, even if voidable by the transferor for fraud, could confer an equitable claim or right upon the transferee. This equitable interest was considered assignable, and a mortgagee advancing money without notice of the fraud acquired a valid charge on the land. The court also found that the attestation provisions of section 107 were facultative, not mandatory, and that the practice of accepting solicitor attestation was sufficient for registration. Furthermore, the court noted that the Act, through provisions concerning trusts and caveats, implicitly recognised and provided mechanisms for the protection of equitable rights arising from unregistered instruments.

The appeals were dismissed, with the court upholding the rights of the mortgagees, Heider and Gale, to hold charges on the land in terms of their respective mortgages, subject to the cancellation of the original transfer.

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