Northern Aust Land & Agency Co Pty Ltd & Ors v Sheahan

Northern Aust Land & Agency Co Pty Ltd and others (the appellants) appealed to the High Court of Australia against a decision of the Supreme Court of Queensland concerning the validity of a mortgage over certain land. The dispute centred on whether the mortgage, granted by the first appellant to the second appellant, was effective to secure a loan made by the second appellant to the first appellant, given that the land was subject to a prior registered mortgage in favour of the respondent.

The High Court was required to determine whether the second appellant's mortgage, which was registered after the respondent's mortgage, had priority over the respondent's interest in the land. This involved considering the operation of the *Real Property Act 1861* (Qld) and the principles of indefeasibility of title under that Act, particularly in circumstances where a subsequent registered proprietor or mortgagee has notice of a prior unregistered interest.

The Court reasoned that the *Real Property Act 1861* (Qld) established a system of Torrens title registration, under which a registered proprietor obtains an indefeasible title subject only to specific exceptions. The Court held that the second appellant, as a subsequent registered mortgagee, acquired a title that was indefeasible against all prior unregistered interests, even if it had notice of those interests at the time of registration. The principle of indefeasibility meant that the second appellant's registered mortgage took priority over the respondent's prior unregistered interest.

The appeal was allowed, and the orders of the Supreme Court of Queensland were set aside.