Royalene Pty Ltd v Registrar of Titles

Royalene Pty Ltd brought a proceeding against the Registrar of Titles, seeking the removal of a caveat and the rectification of the register of title. The property in question was mortgaged to the plaintiff to secure a loan that the second defendant had fraudulently obtained. The second defendant sought rectification of the register and indemnity from the first third party, who had facilitated the loan. The central legal issues revolved around whether the agents of Royalene were guilty of fraud and whether the second defendant could redeem the mortgage without repaying the loan, given the charging clause was inadvertently ruled through before registration. Additionally, the court had to determine the appropriate interest rate to apply to the redemption amount.

The court found that the agents of Royalene were not guilty of fraud as required by s184 of the Land Titles Act 1994 (Qld). Consequently, the second defendant was not entitled to rectification of the register. However, the court ruled that the second defendant was entitled to redeem the mortgage. It held that the inadvertent ruling through of the charging clause did not invalidate the mortgage, and therefore, the mortgage could be released without the repayment of the loan. Regarding the interest, the court decided to fix the interest on the sum outstanding under the mortgage at a rate of 10% per annum from the specified date to the date of redemption.

The court ordered the caveat to be removed but stayed the order for 60 days. It declared that the second defendant, as the registered proprietor, was entitled to redeem the mortgage and receive a duly executed instrument of release upon transfer of the required sum, including interest and costs. The court also ordered the first third party to indemnify the second defendant for the sums paid to redeem the mortgage and her legal costs. Finally, upon payment of the compensation, the first third party was subrogated to the rights of the second defendant against the person responsible for the deprivation, loss, and damage suffered by the second defendant. The parties were directed to be heard regarding costs.