Hemer Pty Ltd v Benni (No 2)

The case of Hemer Pty Ltd v Benni (No 2) concerned a dispute over the purported forfeiture of a 99-year lease registered under the Torrens system in South Australia. The Registrar-General had noted re-entries in the Register Book based on applications by the lessors, Ms Benni and Mr Ridge, and Ms Collins. The primary issue before the Full Court of the Supreme Court of South Australia was whether the Court possessed the power, under section 126 of the Real Property Act 1886 (SA), to direct the Registrar-General to amend or correct the Register Book, specifically to cancel the noted re-entries and reinstate the lease.

The Court was required to determine the extent of its power to intervene in the Registrar-General's administrative actions under section 126 of the Real Property Act 1886 (SA), particularly in light of the principle of indefeasibility of title. This involved considering whether the Registrar-General's noting of re-entries was a conclusive determination of the lease's forfeiture or if the Court could review the underlying circumstances. A further consideration was the impact of the indefeasibility principle on the rights of any bona fide purchaser for value who had acquired an interest in the land subsequent to the lease.

The Court reasoned that section 126 of the Real Property Act 1886 (SA) does not prevent a lessee from challenging an administrative act of the Registrar-General. The section's operation is conditional on the Registrar-General being satisfied of re-entry or recovery of possession, and it does not require proof of lawful forfeiture as a fact. The Court affirmed that it has the power to order the cancellation of an entry made under section 126, thereby correcting the Register Book. However, this power is expressly subject to the principle of indefeasibility of title, which protects the registered interest of a bona fide purchaser for value.

Consequently, the Court ordered the Registrar-General to cancel the entry made in the Register Book and reinstate the registration of the lease in relation to the first and second respondents. No comparable order was made concerning the third respondent, Ms Collins, because the property had been re-mortgaged to a bona fide purchaser for value, whose registered interest was protected by the principle of indefeasibility.