Maguire v Murphy

[1999] HCATrans 403

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Hobart  Nos H3 and H4 of 1998

B e t w e e n -

GILLIAN MARGARET MARY MAGUIRE

Applicant

and

RAYMOND JOHN HENDERSON MURPHY

Respondent

Office of the Registry
  Hobart  Nos H2 of 1999

B e t w e e n -

GILLIAN MARGARET MARY MAGUIRE

Applicant

and

RECORDER OF TITLES

First Respondent

COMMONWEALTH BANK OF AUSTRALIA

Second Respondent

Applications for special leave to appeal

GLEESON CJ
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

FROM HOBART BY VIDEO LINK TO CANBERRA

ON FRIDAY, 19 NOVEMBER 1999, AT 11.40 AM

Copyright in the High Court of Australia

______________________

MS G.M.M. MAGUIRE appeared in person.

MR P.W. TREE:   If the Court pleases, I appear for the respondent in Nos H3 and H4 of 1998.  (instructed by Levis, Stace & Cooper.

MR T.J. ELLIS:   If the Court pleases, I appear for the first respondent in No H2 of 1999.  (instructed by the Director of Public Prosecutions (Tasmania))

MR C.A.A. CUNNINGHAM:   If the Court pleases, I appear for the second respondent.  (instructed by Simmons Wolfhagen)

GLEESON CJ:   Yes, Ms Maguire.

MS MAGUIRE:   Your Honour, I am asserting the legal right to be registered on the folio of register I asked for, and the right to not be subjected to a registration I have

not asked for.  I am saying the respondent has not complied as the property I agreed to take is comprised in the specified folio of the register and not in the physical land.

In Mabo the Court found that despite an historical lack of recognition of native title, an effective system of determining and limiting such title existed.  In this much less important matter, it is proposed that while there is an almost unanimous acceptance of Torrens registration on land, there does not appear to be any effective system in place for ensuring that an intending proprietor can determine the quantity, nature and quality of a title and subsequently the property they receive.  This is an important question for intending purchasers and I acknowledge that I should not really be the one to be arguing it. 

There are two different viewpoints before the Court today, as I understand it.  My view is that a folio is a record of the title to land.  Therefore, I am entitled to view the folio before registration and to be registered on that folio only; whereas his Honour’s view and that of the respondent appears to be that as one is only subject to interest in estates appearing on the current certificate of title, inability to examine the folio of the register affecting the land at the time of the search following a contract is not essential.  Neither is the registration of a proprietor on a folio specified in the writ or transfer.

The emphasis on the certificate of title is the weak point in the respondent’s argument, mainly because as far as the Recorder is concerned, and even in the legislation, the certificate of title is a courtesy document only.  There are other problems relating to the ambiguity in the definitions of the folio and the certificate of title, but I would like to put those to one side for a moment and come back to that issue later.

The respondent is not directly contradicting my assertions about the registration system, but he is saying that being registered on an unknown folio does not matter.  While the respondent sees me as suffering no disadvantage, this is simplistic, as being transferred property which I had not asked for could be worse than being transferred no property at all.  The substantial injustice is that I have been registered proprietor on an unknown folio linked to all sorts of potential interests which I have no way of controlling or limiting.

Justice McHugh’s comments in Yanner v Eaton are appropriate here, and I will read them:  “nor is there anything unusual in a person having property an object of which he or she is unaware.  The common law has long recognised a person may have property in an object, although he or she is unaware of its existence”.  This is what I conceive my problem to be.  I feel as though I have been registered as a proprietor of more land in the Torrens sense than I wish to own. 

I could give an account of the difficulties and harassments which can arise and have arisen as a result of this registration.  However, I can better explain it with an analogy.  Let us imagine a Mr Bloggs has arrived in Hobart on an international flight and picked up his luggage.  He notices that the number on his baggage is different to the number on the baggage retrieval ticket.  However, he still accepts the luggage as the attributes of the luggage are the same, the size, the colour, et cetera.  As he walks to his car, he notices that his luggage is making an unusual ticking noise.  He notices that large, burly men are following him and trying to run him off the road.  Is he not entitled to consider that he may have picked up more property than he was entitled to?  He would not be worried about less property.  Would he be considered obsessive, eccentric, and not have any rights if he dumped the luggage at the nearest police station and insisted they look at it for him?  Would it not be an insubstantial injustice to Mr Bloggs for him not to be able to get rid of the luggage?

A person with some knowledge of the relevance of matching numbers on luggage and baggage check tickets, through incidents such as the Lockerbie air disaster, may not even accept the luggage in the first place, and this would be in line with normal public safety procedures.  It is similar to seeing unclaimed baggage in an airport.  If a person did refuse to accept the baggage, would lawyers regard him as not – and then attempted to claim money for the missing baggage or some other compensation – would lawyers be likely to take the case?  The answer is no, because they would not recognise that he was entitled to have those tickets match up.  I know this sounds like a very simplistic matter, but the lands registration system is just another registration system.  It is very similar to the lay-by system at K‑Mart, there is not much difference, really.

Another example of this is to consider the husband and wife whose main asset is a greyhound.  The wife agrees to take this greyhound in the marital settlement, its registration number 2345, and she specifies this in the Family Court orders.  She goes to pick up the greyhound and finds the registration number has been changed, 2354.  She refuses to take the greyhound, saying it is not what she asked for.  The reason she is refusing to take the dog is not that she is a contrary person, it is that she knows there is the potential for her to be registered as owner of the nine dogs between 2345 and 2354 in the computer system and she does not want to take that risk.  She does not want to take the risk that criminal elements who may have been warned off want to use the other numbers to hide their ownership of the greyhounds behind her registration.  The specification of a registration number allows the woman to limit the amount of property which she is willing to accept.

The question in this matter is on whom should the onus fall to prove that the two titles are the same?  As a particular folio number was specified, the onus should have been placed on the respondent to prove that the two titles were the same and are, in effect, interchangeable, seeing that the respondent was the party who had not complied with the order.  The order is quite clear:  it gives the specific registration number.  The transferee who receives a title which he or she has not seen before is faced with either blindly agreeing the title is the same, or having to investigate the dealings retrospectively, which is extremely expensive and sometimes impossible.  The whole purpose of the Torrens system is that the purchaser does not have the expense of investigating more than one folio of the register.

The question of the unexplained dealings on the first edition of folio 29340/1 is an important one, as these dealings may affect the indefeasible title which is currently assigned to me.  Whether these dealings of registry contrary to the requirements of the Tasmanian Land Titles Act is an important one.  These dealings can clearly be seen in the application book, page 127.  These are extracts from the dispatch schedules of the Land Titles Office, but they are seen by the computer system as dealing numbers.  It is not at all clear whether dealings registered on the first edition of a certificate of title affect the title of the proprietor of the second edition of the same folio.  This is particularly the case where a computer folio is concerned.

The law itself says, from memory – and I can refer to it if you wish – that the folio is the record of title to a parcel or groups of parcels.  I cannot find it.  If your Honours need to refer to it I can go to it.  Anyway, I will leave it for a moment.  That is what it says, it says a folio is a record of title.  It does not say that he folio is the second edition or the first edition, or the latest edition.  It does not mention anything about editions.  Therefore, this is an area of an unknown quantity according to the law because what are lawyers actually searching when they search the title on behalf of their clients, or more likely, what are clients actually searching?  What they need to search is the folio, which is the record of title.  It is actually impossible to determine the answer to this question, without someone supplying the system designs, plans and definitions used in the system in use in the Land Titles Office.  While you can get a similar result by applying the Land Titles Act, the Act does not tell you what the computer has been told to recognise.

The indefeasibility of title relates to what the computer is going to accept and how the computer is programmed.  We can consider an example.  Let us say there is no folio 29340/1 in existence in the Land Titles Office.  Let us say that a certificate of title for 29340/1 is created on an office scanner and sent to the Land Titles Office.  The Land Titles Office does not check to see if that really exist, it just assumes that this folio exists if a certificate of title is provided, that is the way it is programmed – I am just assuming this, but this could happen.  In this case, the fraudster may succeed but the title he or she achieves is worthless, as every other fraudster can achieve the same result.  Good title is only achieved if there is a system in place which will reject all transfers and applications which do not comply with the processes set out by the Act.  Every time these processes are side‑stepped or bypassed by registrants, then the titles of all registrants are devalued.  This is a wider issue with indefeasibility where you can have the technically indefeasible title, but the whole system is collapsing around these failures in the system.

The question of when the proprietor obtains the armour of indefeasibility appears to be a contentious one.  That relates to whether the proprietor is considered to have notice of the dealings on the whole folio or just on the specific edition.  My understanding of indefeasibility is based on the sense of indefeasibility which applies to the security of computer systems, and I would like to use an analogy to describe it.  These systems are based on the concept of medieval armoury.  Individuals give up their armour to a central repository due to the importance of weaponry to the community as a whole.  In a similar manner, we all give up having to defend our land, and get the Land Titles Office to perform this important function for us through the creation of parcels for each property.  These parcels of the land in the registry are imaginary, but we accept that they represent virtual land and they come into existence when the Recorder of Titles creates a folio for it.  The most important aspect of the armoury is to ensure that everyone has equal access to their armour when it is needed, and there is no doubt about who owns a particular set of armour.  This is ensured by adequate labelling and supervision.  This must be to such a standard that each person’s right to that armour is indefeasible, that is, that no one else believes they own the same suit.  This is what indefeasibility is, that no one else can say, “Well, that is my suit of armour”, and it is the same with land.

However, while the armoury is touted to provided indefeasible armour, this is only going to be accepted by the people as long as they can see that strict rules and procedures are being followed.  If the people see that anyone can go into the armoury at will, that no regard is paid to consistent labelling regime, that there is no index of suits kept, that the armourer cannot explain anomalies, then no one is going to believe that no one else in the world can claim their particular suit.  The people will either turn to exploiting loopholes in the system for personal gain, or having no faith in the system, will become disgruntled and difficult to govern, having no faith in government or law.  This is an analogy, but I feel that this wider concept of indefeasibility needs to be considered.  The register is only as indefeasible as the rules which ensure a particular quality or standard, or in the case of land which ensures that there is only one equivalent proprietor for each parcel.

I am rejecting the registration that I have been offered because the previous folio which was specified in the order guaranteed that I was only going to receive a specific amount of property.  Once you say that the Recorder can just change the folio number, there is no guarantee that the property is going to be limited.  There is an actual plan on this which illustrates, on page 128, this problem, to some extent, in that it is plan registered No 93283 which is registered in the Land Titles Office which also comprises my folio which also bears the sealed plan 29340 and on which my lot is also not registered, but it is apparent as lot 1.

There are hundreds of representations of my property in the Land Titles Office.  What is required is the specification of a particular folio number so that that property can be limited.  I only want one instance of that property, not the potential for my folio to be confused with others.

In the digital age, it is just as important for courts to make rulings which protect people from acquiring too much property, as it is to impose rulings which defend people’s property rights.  The problem of a potential excess of property arises because in modern financial times money as cash is not as important as virtual money or digital entry.  Unlike cash currency, digital cash is just bits and bytes and do not have any quality of scarcity.  Any bank clerk can write out millions of dollars in digital cash.  What is required is realistic looking accounts and realistic looking identities to convert those bits and bytes into real money or real entitlements.  All bits and bytes need to become real is a folio number of a file number.  This is the importance of the folio number.  People may unknowingly acquire additional bank accounts, mortgages, insurance policies, shares or even digital lands simply by two accounts being linked together, a slight misspelling in a name which creates another file, or the revival of an old cancelled file.

The importance of good registration procedures in courts:  the issue before the Court today is important to the administration of law because we need to consider what would happen if a judge was faced with a similar conversion of a number.  If we imagine that a judge has a court order ready and wishes to place it in the correct file, the registrar says, “The number of that file is now 23456, not 634 which is what it was originally”, does the judge change the number on the court order?  Does he or she put the order in the file with a new number.  First, the judge would have to make certain what the new number is referred to.  He would have to go to the system

design and look up the classifications of the numbers used.  For example, the series of numbers which comprise 23456 may be designated as numbers for pending matters rather than the matter numbers.  If he does not check up on this, then he runs the risk of having the matter treated as an entirely different heat.  What if numbers up to 30,000 were only minor traffic matters, while the real matter was an armed robbery?  While the numbers do not change, the judge is certain; once they change, the judge is totally uncertain.  The problem becomes even worse if there is no official systems design as the judge can never really tell what the new numbers mean.       How to treat the results of registration processes such as land titles, DNA tests, breath tests, identity of vehicles, and even fingerprints are important questions for judges and lawyers.

Any registration system can be undone by irregular filing practices.  In other words, information is accurate, it is just assigned to the wrong person; or information can be made to disappear from the system altogether.  Such irregular practices can be noticed by, amongst other things, the file number being changed or a slight misspelling of the name, or even gaps between sequential index numbers.  Courts can become victims of this type of deception if they ignore simple signs of filing fraud such as changed identifier numbers.  What I am saying is that that folio number meant exactly what it said it did.  His Honour said that it did not matter, but the respondent did not prove that the title was, in fact, the same which is what he should have been asked to do.

I cannot see any other way of limiting the amount of property which people can acquire if they are not allowed to specify a particular folio.

GLEESON CJ:   We do not need to hear counsel for the respondents in these matters. 

In matters H3 and H4 of 1998 the applicant seeks special leave to appeal from the Full Court of the Family Court of Australia.  The applicant’s arguments disclose no ground which in our view would be likely to enjoy sufficient prospects of success if leave were granted.  In particular, the applicant seeks to challenge discretionary orders made by the Family Court to set aside consent orders in circumstances in which no basis for such a challenge has been shown to exist:  see Mallet v Mallet (1984) 156 CLR 605.

In matter No H2 of 1999, the applicant seeks special leave to appeal from a decision of a single judge of the Federal Court of Australia, Justice Burchett, given in Hobart, refusing an application for an extension of time within which to appeal against a decision of Justice Heerey.

The Court is of the view that the judgment of Justice Heerey was correct and, in consequence, the judgment of Justice Burchett refusing leave to appeal against that decision was also correct.  These applications are all dismissed.  The applicant must pay the respondents’ costs.

We will now deal with applications in Canberra.

AT 12.01 PM THE MATTERS WERE CONCLUDED