PropertyShares Holdings Pty Ltd v 8 Hopetoun Rd Pty Ltd
[2020] VSC 265
•13 May 2020
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
PROPERTY LIST
S ECI 2020 01376
| PROPERTYSHARESHOLDINGS PTY LTD (ACN 605 400 815) | Plaintiff |
| v | |
| 8 HOPETOUN RD PTY LTD (IN LIQUIDATION) (ACN 169 845 452) | First Defendant |
| and | |
| REGISTRAR OF TITLES | Second Defendant |
| and | |
| PROPERTYSHARES PTY LTD (ACN 603 827 792) | Third Defendant |
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JUDGE: | Kennedy J |
WHERE HELD: | Melbourne |
DATE OF HEARING: | 22 April, 7 May 2020 |
DATE OF JUDGMENT: | 13 May 2020 |
CASE MAY BE CITED AS: | PropertyShares Holdings Pty Ltd v 8 Hopetoun Rd Pty Ltd & Ors |
MEDIUM NEUTRAL CITATION: | [2020] VSC 265 |
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EQUITY – Rectification – Application for rectification of electronic mortgage instrument - Where mortgagee is incorrectly identified - Whether remedy ought be granted in relation to unilateral document – Whether remedy appropriate given doctrine of indefeasibility.
REAL PROPERTY – Whether Registrar should be directed to amend Register under s 103(1) Transfer of Land Act 1958 – Relevant considerations - Order made.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr T Messer (22 April) Mr RM Garratt QC, Mr T Messer (7 May) | KCL Law |
| For the Second Defendant | Ms T Acreman (7 May) | Land Use Victoria Legal |
| For Anthony Mercieca (caveator) | Mr T Ibrahim (solicitor) (22 April) | RTS Legal Group |
HER HONOUR:
This is an application for an order that an electronic mortgage be rectified by reason of an error in the name of the registered mortgagee of the property located at 8 Hopetoun Road, Toorak (the property). The application was made as a matter of urgency to the Practice Court.
More particularly, the plaintiff sought the following relevant orders:
(a) An order that the electronic mortgage instrument numbered AR563976P and registered on Certificate of Title Volume 9925 Folio 972 (“the Land”) on 17 October 2018 be rectified by substituting for the words “PropertyShares Pty Ltd” and the ACN Number “603827792” (wherever appearing) the words “PropertyShares Holdings Pty Ltd” and the ACN Number “605400815”.
(b) An order pursuant to s 103(1) of the Transfer of Land Act 1958 directing the Registrar of Titles to make such amendments to the Register or otherwise to do any act or make any recordings necessary to give effect to the Order of the Court and, in particular, to ensure that PropertyShares Holdings Pty Ltd (ACN 605 400 815) is recorded as the registered first mortgagee of the Land under mortgage number AR563976P registered on 17 October 2018.
The issues are, firstly, whether the court ought to make the rectification order, and secondly, whether the court should give the direction under s 103(1).
On 13 March 2020, Hetyey AsJ granted leave to the plaintiff to commence the present proceeding given the first defendant is in liquidation.
The first defendant’s liquidator, Ms T Steedman of JP Downing & Co, neither consents to, nor opposes, the relief sought by the plaintiff (and did not appear).
A number of caveats have been lodged over the property since the registration of the mortgage on 17 October 2018. The plaintiff notified all caveators over the property of the proceeding. One caveator, Anthony Mercieca, initially objected to the relief sought by the plaintiff and appeared on the first return date of 22 April 2020. He challenged that there was a common mistake (as then alleged by the plaintiff) and further claimed that the rectification order should not be made as it undermined indefeasibility principles. However, he has subsequently filed notice ‘discontinuing’ his involvement in the proceeding.[1]
[1]See notice of discontinuance filed on 23 April 2020 by Mr Anthony Mercieca.
The result is that no caveator opposes the orders sought. Further, the (incorrectly named) registered mortgagee (the third defendant) consents to the relief sought. As will be seen below, a proposed purchaser of the property (who has also now lodged a caveat) also consents to the relief sought.
However, shortly prior to the first return date, the Registrar of Titles advised that he opposed the making of the orders above, and sought opportunity to make submissions as set out below. He subsequently appeared and made oral submissions on 7 May 2020.
Background
The first defendant is the registered proprietor of the property.
The plaintiff, PropertyShares Holdings Pty Ltd (PSH) is a non-bank lender and is related to PropertyShares Pty Ltd (PS) (the third defendant). Mr Price is a director of both entities.
In 2018, Gadens Lawyers (Gadens) was retained by PSH to prepare, and lodge for registration, documents in connection with a loan facility to be provided by PSH to the first defendant.
The relevant loan facility is recorded in the form of a letter, dated 12 October 2018, addressed to the first defendant. It recorded that PS, ‘as agent of PSH … is pleased to offer the [relevant facility]’. The loan details then clearly identify PSH as the lender and record that security is to include a mortgage of land granted by the borrower. On the same date, the first defendant also granted a security interest in favour of PSH in the property. Further, by written mortgage instrument dated 12 October 2018 (the written instrument), the first defendant mortgaged to PSH all its estate in fee simple in the property to secure payment of moneys advanced by PSH. The written instrument identifies PSH as the mortgagee and is executed on behalf of the mortgagor first defendant.
Under the electronic conveyancing regime (comprising of the Electronic Conveyancing National Law (Victoria) (ECNL) and the Registrar of Titles’ participation rules[2]), an electronic conveyancing instrument was required to be prepared for registration on title.
[2]Registrar of Titles, Participation Rules made pursuant to s 23 ECNL: the case was run on the basis that Version 4 (27 May 2017) was the correct version of these rules.
Mr Martin Nguyen of Gadens swore an affidavit wherein he stated that he prepared the electronic mortgage instrument (the electronic instrument) for registration by Mr Aidan Brenkovich, also of Gadens. He stated that ‘as a result of a clerical error’ the electronic instrument he prepared incorrectly recorded PS as mortgagee.
Mr Brenkovich also swore an affidavit which confirmed that Mr Nguyen prepared the electronic instrument but accepted that it was his responsibility to certify and register the instrument. He further stated:
I attended to certification and registration of the electronic mortgage instrument. That instrument should have been consistent with the Written Mortgage Instrument and named PSH, as mortgagee, and the First Defendant, as mortgagor. Unfortunately, in certifying and registering the electronic mortgage instrument, I incorrectly certified and registered ‘PropertyShares Pty Ltd’ as mortgagee. This was a clerical error; the error was mine. I should have named PSH as mortgagee; that is what the parties intended as is clear from the other transaction documents.
The electronic instrument he then attached generally reflected the same details as contained in the written instrument save that the mortgagee is identified as PS.
This instrument includes a section entitled ‘mortgagee execution’ which records that it is executed on behalf of PS and signed by Mr Brenkovich of Gadens on 16 October 2018. This section also contains a certificate which certifies, inter alia, that the certifier has taken reasonable steps to verify the identity of the mortgagee and that the certifier holds, or the certifier is reasonably satisfied that the mortgagee it represents holds, a mortgage granted by the mortgagor on the same terms as those contained in the instrument. Further, that the certifier has retained the evidence supporting the instrument.
Mr Brenkovich hence certified and registered the electronic instrument with the result that PS, not PSH, was registered on the title as mortgagee over the property.
Mr Price, the common director, says it was only on advice from his new solicitors in about early February 2020, that he first realised that the mistake had occurred. The unchallenged evidence of Mr Price is that ‘it was always the intention of PSH, PS and the first defendant that PSH would be the mortgagee.’
Following service of a notice for payment, Grant Thornton was appointed as agent for the mortgagee in possession on 5 December 2019 for the sale of the property. Given the error, PSH has been unable to proceed with the sale and is suffering substantial losses as a result. On 14 April 2020, PSH entered into a put and call option with Holmby Nominees Pty Ltd in relation to the sale of the mortgaged property. However, the sale is subject to the successful resolution of this proceeding. Holmby Nominees Pty Ltd has now also lodged a caveat but has consented to the relief sought in this proceeding.
Submissions
Plaintiff’s Submissions
In written submission, the plaintiff relied on the decision of the High Court in Simic v New South Wales Land and Housing Corporation (‘Simic’)[3] and submitted that rectification should be granted on the basis of a ‘common mistake.’ The mistake was ‘common’ because it was the mistake of PSH’s solicitor who signed the electronic instrument on behalf of ‘both parties.’
[3](2016) 260 CLR 85.
However, at the first return date, the court raised a query as to whether there was a ‘common’ mistake in circumstances where, having regard to the terms of the ECNL and participation rules thereto, the electronic instrument appeared to be executed only on behalf of the mortgagee (i.e. by only one side of the transaction). The court subsequently drew the parties’ attention to a group of cases dealing with rectification of ‘unilateral documents.’
In supplementary submissions, the plaintiff then relied upon the cases which suggest that the equitable remedy of rectification is available in relation to unilateral documents. In oral submission, it abandoned reliance on a common mistake, accepting that there was no common mistake of mortgagor and mortgagee in this case. Rather, the mistake occurred in a unilateral document. The plaintiff submitted that rectification, in such a case, turns on the subjective intention of the maker of the document, being Gadens in the person of Mr Brenkovich. However, it also submitted that there could be no doubt as to the intention of PSH in its instructions to Gadens as to the registration of the physical mortgage and completion of the requisite electronic form. Given a decree of rectification relates back to the time of execution of the document, it followed that the electronic instrument is to be read as if executed in its correct form.
In relation to indefeasibility, the first defendant registered proprietor held a registered interest, but did not press any claim. The plaintiff submitted that it could not make such a claim, given its title was subject to a number of potential in personam claims co-extensive with PSH’s rights under the mortgage, which PSH and the first defendant executed. In fact, all parties to the transaction (the first defendant, PSH, and PS as agent) had a common understanding that PSH was to be the mortgagee.
Insofar as the wrongfully registered mortgagee, PS, was concerned, it also consented to the relief sought and did not seek to challenge the order on the basis of indefeasibility. In any event, it was also subject to a number of personal equities which operated as an exception to indefeasibility. First, having been a party (as agent) to the loan security transactions, PS would be bound by conventional estoppel, given each of PSH, PS and the mortgagor had a common understanding and adopted an assumption at all times that PS was merely the agent for PSH which was the intended mortgagee (and not PS). Given a departure from this assumption would occasion detriment, an estoppel by convention was established. Secondly, the plaintiff suggested that the court could impose a constructive trust on PS (consistent with Bahr v Nicolay (No 2)[4]) if it sought to press a claim, given it acquired its interest as a volunteer with notice of PSH’s position. Finally, PS did not, in any event, obtain indefeasibility, given it was a volunteer.
[4](1988) 164 CLR 604.
The plaintiff further submitted that if the electronic instrument was read as if executed in its correct form, it followed that the Register incorrectly recorded the mortgage. It was accordingly open to the Registrar to use the power granted by s 103(2)(a) of the Transfer of Land Act 1958 (TLA) to correct the error. However, if the Registrar declines to make such an order, the court should make an order under s 103(1) directing the Registrar to correct the error.
Insofar as the Registrar raised objection on the basis that changes ought be effected by ordinary conveyancing procedures, the plaintiff submitted that the Registrar’s objections were not supported by the decision in Marchesi v Registrar of Titles (‘Marchesi’),[5] as asserted. Rather, that decision suggested that the s 103(1) power is to be exercised with caution where an alternative practical step to achieve the same end is not readily available. Given that there was no other practical step in this case, an order under s 103 was appropriate.
[5](2010) 30 VR 397.
In oral submission, the plaintiff also submitted that the context in cases such as Marchesi was different since, in those cases, an order under s 103(1) was sought because of an inability to obtain a certificate of title. It was understandable that a court would be concerned that an order under s 103 (to issue a fresh certificate of title) might involve a risk of multiple certificates of title. This was not the case here.
The plaintiff also submitted that an order under s 103(1) would not undermine the seriousness of the certification process. Rather, in circumstances where there was no opposition, the intended mortgagee ought not be punished by reason of an innocent mistake by its solicitor. It also suggested that the principles of indefeasibility were not undermined given the folio had correctly recorded the existence of a registered mortgage.
Registrar’s Submissions
The Registrar submitted that the TLA makes a distinction between the ‘Register’ and the ‘instruments’ recorded in it. This meant that, although the electronic instrument in this case was registered and recorded on the Register, it did not, itself, form part of the Register. It further followed that the Registrar did not have power to amend a registered instrument under s 103(2)(a) since that power extended only to ‘errors in the Register’.
The Registrar conceded that he must obey a direction of the court to give effect to any judgment, decree or order of the court under s 103(1). Further, he accepted that the merits of the substantive question as to whether the electronic instrument should be rectified was generally ‘a matter for the court’ (though in oral submission he highlighted that this was subject to his submission about s 74(5) of the TLA, identified below).
He submitted that it was inappropriate to have a recording in the Register which does not reflect the instrument lodged for registration. Further, that wherever possible, changes to the Register should be effected by ordinary conveyancing practices, and that such powers should be exercised with caution and as a last resort where other practical steps were not available (citing Marchesi).
He submitted that the appropriate method for PSH to seek to register its mortgage was for PS to discharge its mortgage, and for PSH to then lodge an electronic mortgage for registration. This was consistent with s 74(5) of the TLA which provides:
‘A registered mortgage does not operate as a mortgage or charge on the land if for any reason the mortgage is, or is found to be, void or not enforceable at law or in equity and the mortgagee must discharge the mortgage as soon as practicable.’
It was further emphasized that the resolution of competing equities should also be resolved by ordinary conveyancing practices in circumstances where s 34 provides that instruments lodged for registration are registered in the order in which they are lodged. The Registrar did not have the power to vary the priority of instruments lodged for registration. Further, the integrity of the Register requires that changes to the Register should be effected by ordinary conveyancing procedures.
In oral submission, Counsel submitted that it was appropriate for the matter to be dealt with, consistent with s 74(5), by way of discharge of the existing mortgage and then the argument about priorities could come into play.
It was further submitted that the certification process needed to be taken very seriously given it supported the integrity of the torrens system.
The Registrar also submitted that, as no change could be effected to the mortgage instrument, it followed that there would be a ‘missing link’ if an order for rectification was made since, although the name on the Register would be amended, the name on the instrument would remain the same (and would be provided on any search under s 44R). This was undesirable given the Register should reflect the instruments underlying it.
However, on obtaining further instructions at the request of the court, Counsel advised that it was actually possible to make a free text change to the name of the mortgagee which would show up on the folio search, and further, to add a comment at the end of that name which will refer to the s 103 application (which the plaintiff would make attaching any court order made under s 103(1)) . The s 103 application and order would then be allocated its own instrument number and be searchable as an instrument so as to explain what had occurred. In such circumstances, the Registrar thereby withdrew the ‘missing link’ aspect of the submission[6] (given the link was effectively ‘filled’).
[6]Transcript of proceeding, 7 May 2020, 53 [13]-[14].
Nevertheless, the orders were still opposed on the other grounds, particularly the significance of the certification process and the preference for ordinary conveyancing practices.
Rectification
As indicated above, the plaintiff abandoned reliance on common mistake. This was appropriate since the electronic instrument was lodged by Gadens and prepared and executed solely on behalf of the mortgagee by Gadens (as a ‘subscriber’). As highlighted by the Registrar, s 74(1A) of the TLA also makes provision for the Registrar to register a mortgage where the mortgagee (only) has signed the mortgage and provided the relevant certification. This is also consistent with rule 6.13.2 of the participation rules which states that where the mortgagee or its representative signs the electronic mortgage, ‘the mortgagee signs only on its own behalf and not on behalf of the mortgagor.’
However, the doctrine of rectification is also available in relation to unilateral instruments.[7] Rectification is available where it is established by clear and convincing proof that at the time of execution of the instrument, the relevant party had an actual intention as to the effect which the instrument would have which was inconsistent with the effect which the instrument as executed did have, in some clearly identified way.[8] This turns upon the subjective intention of the maker of the document.[9]
[7]Trani v Trani [2018] VSC 274, [151]; GE Capital Finance Australasia Pty Ltd v Federal Commissioner of Taxation (2011) 219 FCR 420, [105]; Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329, 331, 345; Re Butlin’s Settlement Trusts [1976] Ch 251, 260-2.
[8]Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329, 345.
[9]GE Capital Finance Australasia Pty Ltd v Federal Commissioner of Taxation (2011) 219 FCR 420, [106]; Commissioner of Stamp Duties (NSW) v Carlenka Pty Ltd (1995) 41 NSWLR 329, 331-2; Re Butlin’s Settlement Trusts [1976] Ch 251, 262; Allnutt v Wilding [2007] EWCA Civ 412, [11].
The electronic instrument was prepared by Martin Nguyen and executed by Aidan Brenkovich. I accept that the unchallenged evidence establishes that both Mr Nguyen and Mr Brenkovich, at all times, intended for the electronic instrument to name PSH as mortgagee. The fact that Mr Brenkovich certified the electronic instrument as being on the same terms as the written instrument also fortifies such a finding. The evidence also establishes that the intention of PSH was to name itself as the correct mortgagee given it instructed Gadens to lodge the loan facility documents (in its name) for registration.
In naming PS as mortgagee, the electronic instrument thereby had an effect inconsistent with the intended effect of the document.
In these circumstances, rectification would ordinarily be appropriate and would relate back to the time of execution of the document.[10] However, rectification is a discretionary remedy.[11] A complicating feature in this case is the intersection with the torrens system of registration. Thus, it is appropriate to consider whether the orders would undermine principles of indefeasibility given the torrens legislation provides for a system of title by registration based on recordings in the Register.[12] It is also necessary to consider the submissions of the Registrar.
[10]Craddock Bros v Hunt [1923] 2 Ch 136, 151; Cherry Tree Investments Ltd v Landmain Ltd [2013] Ch 305, [121]; New South Wales Land and Housing Corporation v Australia and New Zealand Banking Group Limited [2015] NSWSC 176, [94] (Kunc J), affd Simic v NSW Land and Housing Corporation (2016) 260 CLR 85; John Dyson Heydon, Mark Leeming and Peter Turner, Meagher, Gummow & Lehane’s Equity Doctrines & Remedies (LexisNexis Butterworths, 5th ed, 2014) [27-010].
[11]Whiteside v Whiteside[1950] Ch 65, 71; Fitzgerald v CBL Insurance Ltd [2014] VSC 493, [134].
[12]Paragreen v Lim Group Holdings Pty Ltd [2020] VSCA 84, [58]-[59], citing Breskvar v Wall (1971) 126 CLR 376, 385 (Barwick CJ).
In terms of indefeasibility, except in cases of fraud or other instances provided for in s 42, ss 40-43 of the TLA create indefeasibility of title by the registration of the proprietor, the first defendant. This means that it holds the land subject only to the other interests recorded in the folio of the Register. However, indefeasibility does not deny the right of a plaintiff to bring a claim in personam arising out of personal obligations of the registered proprietor.[13] Given the unchallenged evidence is that the registered proprietor first defendant in this case has given a mortgage to PSH, the registered title of the first defendant is subject to the rights of PSH under the mortgage. This is consistent with the fact that the liquidator has chosen not to oppose the relief sought in this case.
[13]Frazer v Walker [1967] 1 AC 569; Bahr v Nicolay (No 2) (1988) 164 CLR 604.
Insofar as the position of the (wrongly) registered mortgagee is concerned, pursuant to s 74(2) of the TLA, any such mortgage shall, when registered, have effect as a security and be an interest in land. The misnaming of the mortgagee therefore does not, prima facie, affect the indefeasibility of the mortgage when registered (although the indefeasibility would be of minimal value given there is no actual covenant for payment in their favour).[14]
[14]See Perpetual Trustees v Xiao & Anor [2015] VSC 21, [82]-[83].
Nevertheless, PS does not seek to rely on its indefeasibility and actually consents to the relief sought in this case i.e. it accepts that PSH is entitled to be registered in its place. Absent opposition, the Victorian position is also that PS, as a volunteer, would not receive indefeasibility upon registration.[15] PSH may also be able to bring injunctive relief against PS based on conventional estoppel if PS asserted indefeasibility given (consistent with the evidence of the common director) each of PSH and PS acted, assumed, and intended that PSH would be the registered mortgagee.[16] However, given the consent of PS, it is unnecessary to consider this further.
[15]Imam Ali Islamic Centre v Imam Ali Islamic Centre Inc [2018] VSC 413, [353] (McMillan J); King v Smail [1958] VR 273, 275-9 (Adam J); Rasmussen v Rasmussen [1995] 1 VR 613, 631-4 (Coldrey J); cf Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89, 172 [198] (Gleeson CJ, Gummow, Callinan, Haydon and Crennan JJ).
[16]See Moratic Pty Ltd v Gordon [2007] NSWSC 5, [32], cited recently in Bannon v Nauru Phosphate Royalties Trust [2019] VSCA 303, [72]-[74].
Insofar as the Registrar’s position is concerned, neither party adduced any relevant legal authority on s 74(5). However, I do not consider that it weighs against the grant of rectification in this case. First, the provision appears to be largely directed to mortgages found to be void or unenforceable by reason of fraud or some other vitiating factor.[17] This is in marked contradistinction to the present case where PS never held any real underlying mortgage in the first place. Secondly, the remedy of ‘discharge’ is prospective only and is inconsistent with the rectification remedy. Finally, there is nothing to suggest that it operates exhaustively and thereby ousts the general jurisdiction to give rectification where appropriate (which was not suggested in any event).
[17]See generally Anthony P Moore, Scott Grattan, Lynden Griggs, Bradbrook, MacCallum and Moore’s Australian Real Property Law (Thomson Reuters, 6th ed, 2016) [4.130].
In terms of the Registrar’s other submissions, I accept that the certification process needs to be taken very seriously. However, there are a number of factors which weigh in favour of the exercise of discretion in this unusual case. First, there is grave risk of prejudice to the intended mortgagee if a rectification order is not made (which includes an inability to proceed with a sale). Secondly, there was no opposition from any of the other relevant interests. Thirdly, there is potential prejudice to a third party, Holmby Nominees, who has entered a put and call option in relation to the sale of the property, and supports the rectification order. Fourthly, as explained above, the indefeasibility doctrine is not undermined insofar as the other registered interests are concerned. Finally, the subsequent unregistered caveat interests were at all times on notice of the existence of this prior registered mortgage interest (albeit with a mistaken name).
It is most unfortunate that the error has occurred, and any order for rectification should not be taken as some general endorsement of carelessness. However, in the absence of prejudice of any relevant interest, I am not satisfied that the solicitor’s error ought be visited on the true mortgagee, PSH. In all of the circumstances, I am thereby satisfied that a rectification order should be made.
Direction under s 103(1)
Section 103(2)(a) provides that the Registrar ‘may’, upon such evidence as appears to him sufficient, correct errors in the Register. The Registrar has indicated a reluctance to make an order under s 103(2)(a) in this case. However, he has not been formally asked to make a correction, nor has he provided a formal decision. The current proceeding also does not seek to review the exercise/non-exercise of a discretion by the Registrar. In those circumstances, I am unable to be satisfied that this court should make any order in relation to s 103(2)(a).
Insofar as s 103(1) of the TLA is concerned, it provides that in any proceeding in a court relating to any land or any instrument or dealing in respect thereof if the court directs the Registrar to make any amendments to the Register or otherwise to do any act or make any recordings necessary to give effect to any judgment decree or order of the court the Registrar shall obey such direction.
The provision was considered by Ferguson J (as her Honour then was) in Marchesi.[18] The case concerned an inability of a trustee in bankruptcy to obtain the relevant certificate of title from the wife of the bankrupt. The trustee sought an order under s 103(1) that the existing certificates be cancelled and replacement certificates registered.
[18](2010) 30 VR 397 (‘Marchesi’).
Ferguson J reviewed the earlier cases which referred to the provision as a ‘last resort’ and suggested that the rationale for these cases turned on a concern that multiple duplicate certificates of title could come into existence.[19] Her Honour then adopted a more flexible approach concluding that ‘caution must be taken’, and if there were other practical steps that could be taken, then that route should be pursued. However, it was not necessary to exhaust every avenue.[20] She thereby made an order under s 103(1) directing the Registrar to cancel the existing certificates and issue new ones.
[19]Ibid [19].
[20]Ibid.
In the course of her consideration of the authorities, Ferguson J referred to the decision in Haslam v Money for Living(No 2),[21] wherein Tracey J made orders under s 33ZF of the Federal Court of Australia Act 1976 (Cth) requiring the Victorian Registrar of Titles to rectify the register to give effect to a settlement that certain contracts for sale of land were void ab initio. Notwithstanding that s 33ZF raised additional matters for consideration, his Honour identified a number of factors in favour of the order. These included: that ordinary conveyancing procedure would be discordant with the notion of rescission (as it would involve affirmation of the arrangements being displaced); that there would be extra imposts, costs and delay with ordinary conveyancing procedure; and that the settlement agreement might otherwise collapse.[22] As highlighted by Ferguson J, he also distinguished the Victorian cases because, in the matter before him, it was not a question of non-delivery of the duplicate certificate of title (but rather the restoration of the applicants as proprietors).[23]
[21][2007] FCA 1981.
[22]Ibid [15]-[18].
[23]Marshesi [17].
Although I accept that the power under s 103(1) ought be exercised with caution, I am satisfied that an order under s 103(1) is appropriate in the present case. First, the rationale for concern in the Victorian cases to date has centred on the existence of duplicate certificates of title which is not present in this case. Secondly, an order for amendment of the Register with retrospective effect is consistent with the remedy of rectification. Thirdly, the only other remedy suggested is that of discharge. This is not appropriate or practical since it only operates prospectively and is ‘discordant’ with the rectification remedy (which I have determined is appropriate).
I am thereby satisfied that a direction under s 103(1) ought to be given.
Form of order and costs
The Registrar made some further comments about the form of the order, which were agreed to by the plaintiff.
In terms of costs, the plaintiff submitted that costs ought to follow the event. The Registrar submitted that costs should lie where they fall as the plaintiff needed to attend to obtain an order under s 103 regardless of opposition. Further, the presence of the Registrar had assisted the court to understand the technical aspects of the case.
I accept the submissions of the Registrar. Following a mistake in its own 'camp', the plaintiff needed to seek assistance from the court. The attendance of the Registrar was appropriate in providing assistance to the court.
The following orders will therefore be made:
(a) The requirements of rules 5.03(1) and 8.02 of the Supreme Court (General Civil Procedure) Rules 2015 be dispensed with.
(b) The plaintiff be authorised to commence this proceeding by originating motion.
(c) The court hereby rectifies the mortgage instrument numbered AR563976P and registered on folio of the Register Volume 9925 Folio 972 (“the Land”) on 17 October 2018 by substituting for the words “PropertyShares Pty Ltd” and the ACN Number “603827792” (wherever appearing) the words “PropertyShares Holdings Pty Ltd” and the ACN Number “605400815”.
(d) Pursuant to s 103(1) of the Transfer of Land Act 1958, the Registrar of Titles is directed to make such amendments to the Register as are necessary to ensure that PropertyShares Holdings Pty Ltd (ACN 605 400 815) is recorded as the registered first mortgagee of the Land under mortgage number AR563976P registered on 17 October 2018. A copy of mortgage number AR563976P and the mortgage granted by the mortgagor are both attached to this order.
(e) There is no order as to costs.
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