Issa v Owens

In the case of Issa v Owens, the plaintiff, Issa, was a director of a company that held a property as security for a loan advanced by the defendants, the mortgagees. Issa alleged that her son forged her signature on the mortgage and related documents without her knowledge or approval. The defendants claimed that Issa willingly signed the mortgage. The court was required to determine whether the mortgage was procured by fraud and if the mortgagees obtained the benefit of indefeasibility by registration of the mortgage. The court found that Issa was the victim of fraud and that her signature was forged on the mortgage and related documents. Consequently, the mortgage was null and void, and the mortgagees did not obtain the benefit of indefeasibility. The court also found that the mortgagees breached the purchase contract and were liable to the purchasers for damages. The purchasers obtained an equitable interest in the property, but they did not hold the legal interest in the property and had not obtained an indefeasible interest. Issa retained her indefeasible legal interest in the property, and the purchasers' interest did not prevail over Issa's interest.

The court further found that the mortgagees failed to take reasonable steps to verify the identity of the mortgagor as being identical to the registered owner of the property. As a result, they registered the fraudulently obtained mortgage and transfer of mortgage. The court directed the registrar of titles to cancel the instruments bearing dealing numbers 718076402 (mortgage), 718410563 (transfer of mortgage), 718763578 (correction of name), 718815263 (unregistered transfer), and 718858716 (Registrar's caveat). The court also dismissed the plaintiff's claim for payment of compensation by the State and the defendants' counterclaim against the plaintiff. The court ordered judgment for the purchasers against the mortgagees for damages for breach of contract in the sum of $2,751,666.32. The court further dismissed the State's third-party claims against the first and second third parties.