Dixon v Barton

The case of Dixon v Barton involved a dispute between the mortgagees and the mortgagor regarding the discharge of a mortgage. The mortgagees sought to recover their position after their solicitor mistakenly registered a discharge of the mortgage. The court was required to determine whether the mistaken discharge constituted a personal equity exception to the indefeasibility of title, and whether the mortgagor had been unjustly enriched by the mistake. The court also considered whether the terms of a deed between the parties released the mortgagor from prior security interests and covenants, and whether an equitable mortgage arose due to the mortgagees' retention of the certificate of title. Additionally, the court examined the mortgagees' right to subrogation, the existence of a possessory lien over the certificate of title, and whether specific performance should be ordered.

The court held that the mistaken discharge of the mortgage fell within the personal equity exception to indefeasibility of title, as it was unconscionable for the mortgagor to benefit from the mistake. The court also found that the deed did not operate to release the mortgagor from prior security interests and covenants. However, had the deed released the prior security interests, an equitable mortgage would have arisen due to the mortgagees' retention of the certificate of title. The court rejected the mortgagees' claim for subrogation, and found that there was no possessory lien over the certificate of title in circumstances where an equitable mortgage had been established. Finally, the court held that specific performance was not an appropriate remedy, as damages were an adequate remedy for the mortgagees.

The court ordered that the mortgagor be restored to their position prior to the discharge of the mortgage, and that the mortgagees be compensated for the value of the property at the time of the mistaken discharge. The court also ordered that the mortgagor pay damages to the mortgagees for the loss they suffered as a result of the mistaken discharge. The court further ordered that the mortgagees' rights under the deed be enforced, and that the mortgagor be required to specifically perform its payment obligations under the deed. The court did not grant the mortgagees' request for specific performance, as damages were an adequate remedy.