St Abanoub v Registrar-General

[2002] NSWSC 615

CITATION:	St Abanoub v Registrar-General [2002] NSWSC 615
CURRENT JURISDICTION:	Equity Division
FILE NUMBER(S):	SC 2950/02
HEARING DATE(S):	02/07/02
JUDGMENT DATE:	12 July 2002
PARTIES :	St Abanoub Properties Pty Limited - Plaintiff Registrar-General - Defendant Stramit Corporation Limited - Caveator
JUDGMENT OF:	Barrett J

COUNSEL :	Mr D L Warren - Plaintiff Mr P B Walsh - Defendant Mr E A White - Caveator
SOLICITORS:	Gordon Robilliard Plowman Merton - Plaintiff Kenneth Charles Hall - Defendant Ledlin Partners - Caveator
CATCHWORDS:	TORRENS SYSTEM - caveats against dealings - application by registered proprietor for preparation of lapsing notice - meaning of "lapse" - refusal of Registrar-General to record lapse because evidence not submitted within time set by non-statutory administrative practice
LEGISLATION CITED:	Real Property Act 1900
CASES CITED:	Barry v Heider (1914) 19 CLR 197 Butler v Fairclough (1917) 23 CLR 78 Green v Daniels (1977) 51 ALJR 463 J & H Just (Holdings) Pty Ltd v Bank of New South Wales (1971) 125 CLR 546 Scallan v Registrar-General (1988) 12 NSWLR 514 J A Westaway & Son Pty Ltd v Registrar-General (unreported, NSWSC, Young J, 15 August 1996) Wilson v McIntosh [1894] AC 129
DECISION:	Refer paragraph 39

- 20 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION

BARRETT J

FRIDAY, 12 JULY 2002

2950/02 – ST ABANOUB PROPERTIES PTY LIMITED v REGISTRAR-GENERAL

JUDGMENT

1 The issues in these proceedings concern the operation of certain of the provisions of the Real Property Act 1900 dealing with caveats and the action to be taken by the Registrar-General when a caveat lapses.

Facts

2 The facts are not in dispute and may be shortly stated. On or about 12 March 2001, Stramit Corporation Limited, which I shall call “the caveator”, lodged a caveat under s.74F of the Real Property Act affecting land in three folio identifiers of which the plaintiff is the registered proprietor. A notation relating to the caveat (which was given the number 7502407) was, on 27 March 2001, placed on the relevant folios of the register by the Registrar-General. On 10 December 2001, the plaintiff, by its solicitor, made application under s.74J(1) for the preparation of a lapsing notice in respect of the caveat. The lapsing notice was duly prepared by the Registrar-General in accordance with that request and sent to the plaintiff’s solicitor under cover of a letter dated 11 December 2001. Omitting formal and irrelevant parts, that letter read as follows:

“As requested, I now provide notice(s), in duplicate, of proposed lapsing of Caveat No 7502407 pursuant to section 74J Real Property Act 1900.
The original should be served on the caveator in a manner authorised by Section 74N of the Act (see overleaf).
The duplicate should be made an annexure to a statutory declaration (by the person effecting service) setting out the exact date and manner of service of the original. The declaration should then be lodged with the Client Services Counter of the Land Titles Office.
The caveat will lapse 21 days after service of the Notice unless, before the end of that period, the caveator obtains and lodges with this office an order of the Supreme Court of New South Wales extending the operation of the caveat.
If evidence of service is not lodged within two calendar months of the date of this advice, your application will be rejected and the lodgment fee forfeited.”

3 On 18 December 2001, the lapsing notice was served on the caveator by the plaintiff (or, more accurately, the plaintiff’s solicitor). In the following period of 21 days, application was made by the caveator to this court for an order extending the operation of the caveat but, on 2 May 2002, that application was dismissed by consent, the relevant 21 day deadline having by then passed.

4 On 19 February 2002, the plaintiff sent to the Registrar-General a copy of an affidavit of the solicitor for the caveator filed in the proceedings in which an extending order was sought. That affidavit confirmed receipt of the lapsing notice by the caveator on 18 December 2001 and made it clear that service had been effected in the manner referred to in s.74N(1)(d) of the Real Property Act. The plaintiff requested the Registrar-General to remove the caveat from the register. After a subsequent telephone conversation between the plaintiff’s solicitor and a person in the Registrar-General’s office, the solicitor wrote to the Registrar-General as follows on 24 February 2002:

“We refer to our letter to you of 19 February, 2002, and to the writer’s subsequent telephone conversation on 20 February, 2002, with your Mr Cini. We note Mr Cini’s advice that you are unable to record the lapsing of the caveat off the title because the evidence of service of the lapsing notice was not filed within two months of the date of the issue of the lapsing.
We firstly advise, that we were not unfortunately the applicant for the issue of the lapsing notice and only became instructed in the matter recently. More importantly however, Section 74J of the Real Property Act does not require that evidence of the service be provided within any period. You will be aware that Section 74J(2) provides that the caveat lapses 21 days after the date on which the lapsing notice was so served. Accordingly, as the lapsing notice has been served and Section 74J(2)(a) and (b) is not applicable, you ought record the lapsing of the caveat.
Please confirm that the caveat has been removed by return.”

5 The Registrar-General’s reply dated 11 March 2002 was as follows:

“I refer to your letters of 19 and 24 February 2002, which appears to have been prompted by a somewhat belated application to the court to extend the operation of caveat 7502407.
Application for Lapsing of Caveat 8186185 has been rejected, and caveat 7502407 will not be removed from the Register.
As you know, rejection was on the basis that no evidence of service of the lapsing notice was lodged within two months of the dispatch to the lodging party of notices.
Rejection of Dealings
I enclose copies of the following:-
1. Paragraph 95.2000 – Baalman and Wells Land Titles Office Practice; and
2. Pro forma letter which is sent to applicants for lapsing of caveats. Your attention is drawn to paragraph 5 which refers to the two month period within which evidence of service is required.
In administering the provisions of the Real Property Act, I am entitled to establish administrative practices and procedures. The well established practice of rejecting dealings with respect to which my requirements or requisitions are not satisfied with a two month period is described in paragraph 95.200 of Baalman and Wells.
The lapsing of caveats is an administrative procedure, and I am entitled to statutory declaration of evidence of proper service of lapsing notice furnished with a 2 month period of the date of my letter forwarding those notices.
Having regard to the pivotal nature of caveats in the scheme of the Real Property Act, and the time limits provided for in the lapsing provisions, compliance by a lodging party with time limits is crucial.”

(The pro forma letter referred to in item 2 reflects the letter of 4 December 2001 sent by the Registrar-General to the plaintiff’s solicitor.)

6 There was certain further correspondence in which the Registrar-General asserted that the plaintiff had “the right to seek lapsing of caveat 7502407 by lodging a fresh Lapsing Application” and expressed surprise that the plaintiff preferred to consider litigation rather than that apparently simple course. A notation of the caveat continues to be recorded on the relevant folios of the register. It is in these circumstances that the plaintiff now comes to court seeking two orders, namely:

“1. An order reviewing the decision of the Registrar-General whereby the Registrar-General refused to record the lapsing of caveat 7502407, entered on Folio Identifiers 1/873196, 5/873196 and 6/873196.
2. An order that the Registrar-General record the lapsing of the caveat in respect of the Folio Identifiers referred to in paragraph 1 hereof.”

7 Both the plaintiff and the Registrar-General appeared by counsel on the hearing of the proceedings (Mr Warren for the plaintiff and Mr Walsh for the Registrar-General). By consent, I granted leave for the caveator to appear by counsel (Mr White) but no submissions on the substantive issues were made on behalf of the caveator.

The statutory provisions and their effect

8 Section 74F allows any person who, by virtue of any unregistered dealing or by devolution of law or otherwise, claims to be entitled to a legal or equitable estate or interest in land under the provisions of the Act to lodge with the Registrar-General a caveat prohibiting the recording of any dealing affecting the estate or interest to which the person claims to be entitled. Section 74G describes the action the Registrar-General must take once such a caveat is lodged:

“For the purposes only of acknowledging the receipt of a caveat lodged under section 74F, the Registrar-General shall, if satisfied that the caveat complies with the requirements made in respect of it by and under this Act, record in the Register such particulars of the caveat as the Registrar-General considers appropriate.”

9 Section 12(1)(f) should also be noted:

“The Registrar-General may exercise the following powers, that is to say:
…….
(f) For the protection of any person interested in land under the provisions of this Act the Registrar-General may record in the Register a caveat, or may otherwise record the interest of that person in the Register in such manner as appears to the Registrar-General to be appropriate.”

10 A caveat lodged under s.74F is not within the definition of “dealing” in s.3(1). That definition is as follows:

“Any instrument other than a grant or caveat which is registrable or capable of being made registrable under the provisions of this Act, or in respect of which any recording in the Register is by this or any other Act of the Parliament of the Commonwealth required or permitted to be made.”

A caveat is excluded by the words “other than a grant or caveat” in the definition. Those introductory excluding words operate for the purposes of both the subsequent part beginning “which is registrable …” and the alternative introduced by “or in respect of which …”. The distinction between caveats and dealings is thus clear. It is highlighted in a number of the Act’s provisions, among them s.36.

11 The provisions with respect to registration of dealings accordingly do not apply to caveats. The observation of Isaacs J in Barry v Heider (1914) 19 CLR 197 that “[c]aveats are lodged, not registered” remains accurate in relation to the system embodied in the current New South Wales legislation: J A Westaway & Son Pty Ltd v Registrar-General (unreported, NSWSC, Young J, 15 August 1996). Section s.74G is the only provision imposing a requirement about the way in which a s.74F caveat is to be processed or dealt with by the Registrar-General following its lodgment. That positive requirement subsumes, in the particular case of a s.74F caveat, the power conferred by s.12(1)(f) as to caveats generally. The recording of a s.74F caveat proceeds from discharge of the s.74G duty, not exercise of the s.12(1)(f) power. In any event, the word used in each case is “record”, not “register”.

12 It is, of course, axiomatic that such estate or interest as is claimed in a s.74F caveat does not, by virtue of the s.74G recording, acquire any status under the Act. Section 74G itself states the limited purpose of the recording it requires. As is made clear by the judgments in J & H Just (Holdings) Pty Ltd v Bank of New South Wales (1971) 125 CLR 546, a caveat serves the twofold purpose of providing notice to the world of the caveator’s claim (not his estate or interest) and of staying the Registrar-General’s hand for a period if a dealing inconsistent with the claimed estate or interest is lodged, thereby affording time for the validity of the caveator’s claim to be tested in court. It is fundamental to the first of these purposes that current and reliable information as to the existence or non-existence of a caveat be available on search.

13 I now set out the terms of s.74J:

“(1) Where a caveat lodged under section 74F remains in force, the Registrar-General shall, on an application being made in the approved form by the registered proprietor of an estate or interest in the land described in the caveat, prepare for service on the caveator a notice to the effect that, unless the caveator takes the action referred to in subsection (2) before the expiry of 21 days after the date of service of the notice, the caveat will lapse.

(2) Where a notice prepared under subsection (1) has been served on the caveator, the caveat lapses at the end of 21 days after the date on which the notice was so served unless, before the end of that period, the caveator has:

(a) obtained from the Supreme Court an order extending the operation of the caveat for such further period as may be specified in the order or until the further order of that Court, and
(b) lodged with the Registrar-General the order or an office copy of the order.

14 The concept of “lapsing” of a caveat requires examination. It is of long standing in Torrens system legislation and is employed in several of the current sections of the Real Property Act dealing with caveats: see, in addition to s.74J, ss.74I, 74JA and 74LA. As embodied in earlier Victorian legislation, it was summed up in the following sentence of the judgment of Griffith CJ in Butler v Fairclough (1917) 23 CLR 78:

“But if he [caveator] desires to do so he must take prompt action, i.e., within fourteen days, or the caveat will lapse, i.e., the protection afforded by it will cease .” [emphasis added]

15 “Lapse” is an event that marks the end of the period during which a caveat, in the words of s.74H, “remains in force” in such a way as to provide protection to the caveator by way of notice of the estate or interest asserted. Lapse entails termination of the command addressed to the Registrar-General by s.74H that he not take certain defined actions which he would otherwise be able and required to take in relation to the relevant title but which appear to him to be prohibited by the caveat. A caveat that has lapsed is no longer of any efficacy to achieve the legal results that caveats produce. It has no continuing existence (Wilson v McIntosh [1894] AC 129) and is to all intents and purposes dead. And this is so whether or not the recording in relation to it remains on the title in unqualified form.

16 Section 74J(2) is a provision which, of its own force, causes caveats to lapse. It describes circumstances in which “the caveat lapses”, that is, ceases to be effective to prevent the taking by the Registrar-General of the particular actions identified in s.74H. The circumstances in which that result is produced by s.74J(2) are, first, the making by the registered proprietor of an application for the preparation by the Registrar-General of a particular notice for service on the caveator; second, preparation of that notice by the Registrar-General in accordance with registered proprietor’s application; third, service of the notice on the registered proprietor (the available modes of service being those set out in s.74N); and, fourth, absence, throughout the period of 21 days after service, of both the events referred to in s.74J(2), being the obtaining by the caveator from this court of an order extending the operation of the caveat and lodgment of the order or an office copy of it by the caveator with the Registrar-General.

The present status of the caveat

17 It is not disputed, in the present case, that all the circumstances I have just described came to pass in relation to the caveat in question. It must follow that the caveat lapsed, by operation of s.74J, immediately after the expiration of the relevant period of 21 days; and that, at that point, the caveat ceased to prohibit the various actions of the Registrar-General specified in s.74H and was accordingly of no further or continuing force or effect.

18 Despite these consequences produced by operation of the statute, an unqualified recording of the caveat remains on the relevant folios. Furthermore, the Registrar-General refuses to add any notation of the caveat’s having lapsed, maintaining that an administrative practice requiring the furnishing of evidence of service of the s.74J(1) notice within a certain time justifies his leaving the s.74G recording in place indefinitely without qualification.

The Registrar-General’s administrative practice

19 Evidence of the administrative practice in cases of this kind was given by Mr J G J Fitzgerald, an Administrative Officer, Practice in the Office of the Registrar-General. Mr Fitzgerald’s current responsibilities include monitoring the Manual of Practice and developing and administering policy, practice and procedure with respect to dealing registration. He provides technical advice with respect to registration and considers priorities between caveats and conflicting dealings.

20 It is appropriate to set out in full the description of the relevant practice contained in Mr Fitzgerald’s affidavit (interpolating, as appropriate, descriptions of the annexures and explanation of the abbreviation):

“3. The usual procedure of LPI [i.e., Land and Property Information, the department of which the Registrar General’s Office is part] with respect to an Application for Preparation of Lapsing Notices (‘Lapsing Application’) is as follows:
(a) A Lapsing Application in the form of Annexure ‘A’ to this Affidavit [corresponding with the form lodged by the plaintiff’s solicitor on 10 December 2001] is lodged with LPI and is noted as an unregistered dealing on the relevant folio of the Register;
(b) Notice for service on the Caveator is generally prepared by LPI within 2 working days of lodgment of the Application and is forwarded to the lodging party with a covering letter with respect to the lapsing procedure generally and the service of notice.
That covering letter states:
“If evidence of service of notices is not lodged within two calendar months of the date of this advice, your application will be rejected and the lodgment fee forfeited.”

(c) Annexed hereto and marked ‘B’ and ‘C’ respectively are a pro forma notice and letter [these correspond with the letter of 11 December 2001 quoted in full above and the notice enclosed with it].

(d) Upon lodgment of acceptable evidence as to service of the lapsing notice the officer handling the Lapsing Application calculates the period of 21 days within which an order of the Supreme Court is to be obtained by the caveator.

(e) On the final business day following the expiration of that 21 day period, if no order extending the operation of the caveat has been lodged or evidence provided that an order has been obtained, then the caveat is lapsed. The Lapsing Application and its date of registration is noted in the historical file and the notation of the relevant caveat removed from the 2nd Schedule of the relevant folio of the Register.

4. If within 2 months of the date on which notices are forwarded to the Applicant evidence of service of the lapsing notices has not been lodged, and no request for an extension of that time limit has been made, the Lapsing Application will be rejected pursuant to s.39(1A) of the Real Property Act.
5. Notice of rejection, a pro forma of which is annexed hereto and marked ‘D’ is sent to the lodging party. Within the next one to two days the Lapsing Application is marked ‘rejected’ and is returned to the lodging party.

6. To the best of my knowledge and belief, the 2 month time period for service of notices has been applied since s.74J of the Real Property Act was enacted in 1986.
7. Normally, where requisitions are raised with respect to a Real Property Act dealing, and are not attended to within 2 months of the date on which they are sent, that dealing becomes liable to rejection. Usually, a further 28 day notice of proposed rejection is sent. A lodging party may also obtain extensions of time.
8. In the case of Lapsing Applications, no 28 day notice is usually given. The reasons for this are as follows:
(a) 2 months is considered to be a generous period within which to arrange for service of notices and provide evidence as to service;
(b) The Registrar General seeks to maintain impartiality between the caveator and the Lapsing Applicant. The caveator, following service of notice has a limited time in which to obtain an order extending the operation of the caveat. In these circumstances it is appropriate that notices prepared and issued by the Registrar General should be served within a reasonable time and not remain at large, available to be served within an unlimited time.”

21 I should also set out here an extract from the written submissions made by Mr Walsh of counsel on behalf of the Registrar-General. After submitting that the Registrar-General is entitled to adopt practices and procedures to be observed in relation to administration of the Act, Mr Walsh made the following submission:

“An application for Preparation of Lapsing Notices is a dealing defined by s.3(1)(a) of the Act. It is the instrument which is recorded in the Register to give effect to the lapsing of a caveat. Section 32(7) provides that “ the Registrar General shall maintain a record of all dealings in, or action taken in respect of, a computer folio and such other information, if any, relating to the folio as the Registrar General thinks fit ”. For each computer folio, an historical record is maintained, providing a chronological list of all dealings and plans recorded against the computer folio since its creation. When a caveat is lapsed, the date of lapsing and the number of the Application for Preparation of Lapsing Notices is recorded in the historical record. If an Application for Preparation of Lapsing Notices is not a dealing it could not be recorded in the Register. Without such a recording, there could not be compliance with s.32(7) and it would be impossible to administer other sections such as s.74O.”

Assessment of the Registrar-General’s position

22 Three propositions are central to the Registrar-General’s practice and the asserted justification of it: first, that, after the s.74J(1) notice has been served on the caveator and the 21 day period has elapsed without the s.74J(2) events having happened, the Registrar-General performs some subsequent and positive function of “lapsing” the caveat by entry in the register; second, that the s.39(1A) power of rejection is exercisable in relation to the registered proprietor’s s.74J(1) application; and, third, that that power continues to be so exercisable after the notice the application seeks has been prepared by the Registrar-General. These reflect misconceptions.

23 An application under s.74J(1) is an application for no more than the preparation of a notice by the Registrar-General. The operative words of the form of application which is annexure A to Mr Fitzgerald’s affidavit, as it applies in a s.74J case such as the present, are:

“APPLICANT … being … registered proprietor of the above land … applies under section 74J of the Real Property Act 1900 for the preparation of the notice referred to in that section.”

24 This form of words accords with the section itself. Having prepared the notice, the Registrar-General has fulfilled the application according to both its own terms and the contemplation of the section. The application is not, thereafter, the source of any further requirement upon the Registrar-General and is spent.

25 It is not correct to regard the Registrar-General as capable of performing some positive act of “lapsing” in relation to a caveat, at least in so far as such a positive act may be viewed as one which puts an end to the caveat’s efficacy to enjoin the actions of the Registrar-General specified in s.74H. Lapsing of a s.74F caveat occurs by operation of s.74J when the circumstances described in the latter section arise. The section itself uses the words “the caveat lapses”. No act of the Registrar-General brings about the lapse, although, of course, the preparation by the Registrar-General of the notice addressed to the caveator forms part of the series of events which must be seen to have occurred to justify a conclusion of lapse by operation of law.

26 I turn now to the assumption or assertion in the description of the Registrar-General’s practice that s.39(1A) applies in a case of s.74J lapsing. Section 39(1A) is in the following terms:

“The Registrar-General:

(a) may refuse to register, or may reject, any dealing lodged for registration, and

(b) may reject any memorandum or caveat lodged with the Registrar-General,

that does not comply with any requirement made, with respect to the dealing, memorandum or caveat, as the case may be, by or under this or any other Act.”

27 Having regard to the s.3(1)(a) definition of “dealing” (which is set out in full earlier in these reasons), it is clear that an application under s.74J(1) for the preparation of a notice by the Registrar-General is not a “dealing”. This is because it is not registrable or capable of being made registrable and is not an application in respect of which any recording in the register is required or permitted. The application seeks nothing more than the preparation by the Registrar-General of a notice addressed to the caveator. Once that notice has been prepared, nothing remains to be done under or in response to the application. It has no further efficacy. A series of events in which the notice issued in response to the application plays a part may or may not eventually result in the caveat’s lapsing. But that does not happen through any recording in the register. It is a consequence produced by operation of the statute when the particular set of circumstances has come into existence.

28 It follows from what I have said about s.39(1A) and the nature of an application by a registered proprietor under s.74J(1) that I do not accept the contention that, at some time after the Registrar-General has prepared a notice in response to the application, he has some continuing power to “reject” that application.

Conclusions

29 There can be no doubt that the Registrar-General has power to establish practices and procedures which are to be applied and observed in the administration of the Real Property Act. But those practices and procedures cannot fail to recognise and give effect to the Act. The practice described by Mr Fitzgerald is, in my judgment, a practice which fails to recognise the due operation of the Act. Neither s.74J nor any other provision operates to give a finite life to a notice prepared under s.74J(1) in the sense of depriving the notice of force if it is not served within a particular time. Furthermore, if all circumstances described in s.74J are shown to have come into existence, the relevant caveat lapses by force of that section and it is not open to the Registrar-General to maintain that, because evidence of service of the s.74J(1) notice was not received by him by a time fixed by him, that lapse has not occurred. Nor is it open to the Registrar-General to maintain, consistently with the Act, that a caveat which s.74J(2) has caused to lapse is still effective and may be made the subject of a second or subsequent application for the preparation of a notice under s.74J(1).

30 I do not for a moment say that the Registrar-General should accept that lapsing has occurred by operation of law unless he has received such credible evidence of relevant matters (including, in particular, service of the lapsing notice in accordance with s.74N) as he, in his reasonable discretion, requires. But once that evidence has been received, the Registrar-General must recognise that lapsing has occurred; and this is so regardless of the time that has passed between preparation of the s.74J(1) notice to the applicant registered proprietor and its service on the caveator, or between the expiration of the 21 day period to which the section refers and receipt of the relevant evidence by the Registrar-General.

31 The Registrar-General’s desire, as a general administrative matter, to introduce time limits in the interests of efficiency is both understandable and appropriate. There may well be a place for administratively imposed time limits in relation to the satisfaction of requisitions affecting dealings submitted otherwise than in registrable form. But there is no place for such limits where the matter at hand is recognition of a legal consequence produced by the Act. Whether the Act should be amended to accommodate, in s.74J cases, procedures of the kind described by Mr Fitzgerald is, of course, a question with which the court is not concerned.

32 Where recording of a s.74F caveat appears on the relevant folio of the register and it is shown to the Registrar-General’s reasonable satisfaction that the caveat has lapsed by operation of s.74J(2), there is clearly a need for a record of the lapsing to appear on that folio. Because notice to persons searching the register lies at the heart of the caveat system, it is fundamental that there must appear on the face of the register at any given time the status of any caveat as then known to the Registrar-General.

33 Section 32(6) of the Real Property Act confers on the Registrar-General power to cancel any “recording” in the register that the Registrar-General is satisfied does not affect the land to which the recording purports to relate. A “recording” made in accordance with s.74G is within the scope of s.32(6). In Scallan v Registrar-General (1988) 12 NSWLR 514, Young J had occasion to consider the scope and effect of s.32(6) in a context where the Registrar-General, relying on evidence furnished to him by statutory declaration, cancelled a recording relating to a mortgage. It is pertinent to quote at some length from his Honour’s judgment:

“It would appear that the practice of the Registrar-General has been to cancel the registration of a mortgage where the mortgagor has proved repayment of the moneys secured to a mortgagee who has disappeared without executing a formal discharge and also to cancel the recording if a long period of time has passed so that the mortgagee would be barred by the Limitation Act 1969 and there is no legal personal representative of the mortgagee in New South Wales from whom a discharge could be obtained. The Registrar-General so acts upon his construction of the power given to him by the Real Property Act 1900, s.32(6). That subsection reads:
‘The Registrar-General shall have, and shall be deemed always to have had, the power to cancel in such manner as he considers proper any recording in the Register that he is satisfied does not affect the land to which the recording purports to relate.’
Whilst the Registrar-General construed his power with ‘an element of flexibility sufficient to relieve cases of hardship’ ( Woodman and Nettle on the Torrens System (1985) at 278) he submits that there is nothing in s.32(6) which overrides the prime duties on the Registrar-General imposed by ss.39, 65 and 104.
Section 39(1) prohibits the Registrar-General from registering a dealing ‘except in the manner herein provided’. Section 65(1) deals with discharges of mortgage and provides that whenever it is intended to discharge a mortgage ‘the mortgagee … shall execute a discharge in the approved form’. Section 104 empowers the Registrar-General to register a dealing ‘containing departures, not being matters of substance, from an approved form’. This seems to imply that where there are substantial departures from an approved form the Registrar-General is powerless to register the change of interests purporting to be made by the instrument in question.
In Crowley v Templeton (1914) 17 CLR 457 at 463, Griffith CJ indicated that the only way of dealing with land was by alteration of the register ‘and modes by which such alteration can be procured are prescribed by the Act. No other mode is authorized. These provisions, therefore, although in form permissive or facultative, are in effect peremptory and exclusive’. However Maughan AJ in Lewis v Keene (1936) 36 SR (NSW) 493; 53 WN (NSW) 177, whilst recognising the force of that observation, held that the Act did not prevent the Registrar-General from removing a lease which had merged with the freehold. Indeed the High Court itself, in Fink v Robertson (1907) 4 CLR 864 at 867, observed:
‘… if a mortgagor transfers the mortgaged land to the mortgagee the mortgage is extinguished. The Act does not make express provision to that effect, for it was obviously unnecessary to do so. But the mortgagee would, of course, in such a case be entitled to a certificate of title subject only to incumbrances created by the mortgagor in favour of other persons.’
Accordingly, I do not consider that the submission that ss.39, 65 and 104 limit the Registrar’s powers so as to preclude him from writing off a mortgage which he is satisfied no longer affects the title. It seems to me that the exegesis of s.32(6) set out in Woodman and Nettle’s book is essentially correct.”

34 It is recognised here that, if the Registrar-General is presented with credible evidence that, because of some intervening circumstance, a recording in the register no longer reflects the true position in relation to the matter to which it relates, he may resort to s.32(6) as a means of restoring the integrity and accuracy of the register. The process for which s.32(6) makes provision is not one of correction of something that was from its beginning wrong. Correction of errors is dealt with elsewhere in the Act. Cancellation under s.32(6) recognises that a recording does not, at the time of the cancellation, have effect according to its purport. As the instances quoted by Young J concerning mortgages and leases demonstrate, action under s.32(6) does not involve any assertion or consequence that the subject of the relevant recording never existed or was never operative – merely that it no longer exists or is no longer operative.

35 Two things may be said about the s.32(6) power in the present context. First, it is not open to the Registrar-General to substitute policies involving arbitrary time limits or other elements of administrative convenience for his responsibility to consider whether, in the light of the particular circumstances prevailing as known to him, an occasion for the exercise of the power has arisen: Green v Daniels (1977) 51 ALJR 463. Second, the Registrar-General is bound to exercise his judgment actively and honestly as to whether he should resort to the power or refrain from doing so, the fundamental consideration being the purpose for which the power is conferred, namely, the maintenance of the integrity and accuracy of the register.

36 Because, in the present case, the Registrar-General accepts the facts as I have recited them (including service of the s.74J(1) notice and the absence of both making and service of any extending order, whether within the following 21 days or at all), the Registrar-General is bound to recognise that caveat 7502407 lapsed by operation of law in January 2002 and is of no continuing force or effect. The facts disclose no conceivable basis on which the continued existence of the unqualified recording in relation to the caveat can be regarded as otherwise than misleading. The Registrar-General’s power under s.32(6) to cancel that recording has not only become exercisable but should be exercised so that the legal consequence of the facts accepted by the Registrar-General is accurately reflected on the relevant folios of the register.

Relief

37 The plaintiff’s first claim for relief is based on s.122 of the Act by reference to the Registrar-General’s decision not to make any entry to record the lapsing of the caveat. The decisions which are amenable to relief by order of the court under s.122 are those referred to in s.121(1). In the present circumstances, the only potentially relevant class of decision is the class concerned with a

“… decision … to have exercised or performed in relation to land any function or duty which, by this Act, is required to be exercised or performed by the Registrar-General.”

This is the class of decision referred to in s.121(1)(c). The categories in ss.121(1)(a) and 121(1)(b) are irrelevant here, particularly since, as discussed, no “dealing” is involved.

38 It seems to me that there may be difficulty in granting relief by reference to s.122. The Registrar-General’s decision is a decision to refrain from action (that is, not to record the lapsing of the caveat), as distinct from a “decision … to have exercised or performed” a function or duty. Furthermore, the course I have identified as that to be followed by the Registrar-General here (namely, resort to the s.32(6) power) arguably does not involve exercise or performance of a function or duty which “by this Act” is “required” to be exercised or performed. Section 32(6) creates a power but does not, in express terms, “require” its exercise in any particular case. I therefore prefer not to make any order by reference to s.122.

39 The fact nevertheless remains that, in the light of the agreed facts, there is no basis on which the Registrar-General can continue to maintain that the caveat has not lapsed; that his power under s.32(6) to cancel the recording in relation to the caveat is now capable of being exercised; and that maintenance of the integrity and accuracy of the register (which is the consideration by reference to which the s.32(6) power is conferred) requires that the power be so exercised. In those circumstances, I consider that a case has been made for the making of an order substantially to the effect of the second order the plaintiff seeks. The order I consider it appropriate to make is an order that the Registrar-General cancel the recording of caveat 7502407 on folio identifiers 1/873196, 5/873196 and 6/873196.

40 Before pronouncing that order, I shall, as the caveator requested (with the concurrence of the plaintiff), afford the caveator a short time within which to take steps towards seeking renewed protection of the estate or interest it claims. The proceedings will be stood to a time and date I shall fix after discussion with counsel. I shall at that time make the order I have foreshadowed and hear submissions on costs.

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Last Modified: 07/15/2002