Tara Shire Council v Garner

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SUPREME COURT OF QUEENSLAND

CITATION:

Tara Shire Council v Garner & Ors [2002] QCA 232

PARTIES:

TARA SHIRE COUNCIL
(plaintiff/first respondent)
v
CECIL EDWARD GARNER and
JOSEPHINE MICHELE GARNER
(first defendants/second respondents)
ARCAPE PTY LTD  ACN 010 871 280
(first third party/second defendant/applicant)
COLIN WARWICK MARTIN
(second third party)

FILE NO/S:

Appeal No 1613 of 2002
DC No 2921 of 1998

DIVISION:

Court of Appeal

PROCEEDING:

Application for Leave s 118 DCA (Civil)

ORIGINATING COURT:

District Court at Brisbane

DELIVERED ON:

28 June 2002

DELIVERED AT:

Brisbane

HEARING DATE:

23 April 2002

JUDGES:

McMurdo P, Davies JA and Atkinson J
Separate reasons for judgment of each member of the Court;  McMurdo P and Atkinson J concurring as to the order made, Davies JA dissenting

ORDER:

Application for leave to appeal refused

CATCHWORDS:

CONVEYANCING - LAND TITLES UNDER THE TORRENS SYSTEM - INDEFEASIBILITY OF TITLE: CERTIFICATE AS EVIDENCE - EXCEPTIONS - GENERALLY - where the second respondents sold a piece of land to the first respondent - where purchase price paid - where the second respondents subsequently sold the piece of land to the applicant - where the applicant acquired its interest in the land with knowledge that the land had been sold to the first respondent - whether the applicant has indefeasible title of the land in accordance with s 184 of the Land Title Act 1994 (Qld) - whether the knowledge of the applicant was sufficient to give rise to an "equity" within the meaning of the exception to indefeasibility contained in s 185(1)(a) of the Land Title Act

CONVEYANCING - LAND TITLES UNDER THE TORRENS SYSTEM - INDEFEASIBILITY OF TITLE:  CERTIFICATE AS EVIDENCE - EXCEPTIONS - GENERALLY - whether a cause of action based on the first limb of the Rule in Barnes v Addy is a sufficient equity to overcome indefeasibility - whether there must be dishonesty to overcome indefeasibility

CONVEYANCING - LAND TITLES UNDER THE TORRENS SYSTEM - TRUSTS, EQUITIES AND UNREGISTERED INSTRUMENTS AND INTERESTS - EQUITABLE ESTATES AND INTERESTS - where the applicant acquired its registered title with knowledge that the land had been sold to the first respondent - whether the applicant held its registered title subject to a constructive trust in accordance with the first limb of the Rule in Barnes v Addy

EQUITY - TRUSTS AND TRUSTEES - CONSTITUTION AND CLASSIFICATION OF TRUSTS GENERALLY - CLASSIFICATION OF TRUSTS IN GENERAL - IMPLIED TRUSTS - RESULTING TRUSTS - WHETHER INTENTION PRESUMED - WHEN ARISING - OTHER CASES - where the second respondents sold a piece of land to the first respondent - where purchase price paid - whether the second respondents held the land on trust for the first respondent

EQUITY - TRUSTS AND TRUSTEES - FOLLOWING TRUST PROPERTY - IN GENERAL - where applicant acquired its registered title with knowledge the land had been sold to the first respondent - whether knowledge pleaded was sufficient to sustain an action under the first limb of the Rule in Barnes v Addy - whether…

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Details
Case
[2002] QCA 232
Decision Date

CaseChat Overview and Summary

In the case of Tara Shire Council v Garner, the dispute revolved around the ownership of a piece of land that had been sold twice. The second respondents initially sold the land to the first respondent and received the purchase price. Subsequently, the second respondents sold the same land to the applicant, who was aware of the prior sale to the first respondent. The applicant sought a declaration that they held indefeasible title to the land under section 184 of the Land Title Act 1994 (Qld). The first respondent argued that the applicant's title was subject to an equity, specifically a constructive trust, under section 185(1)(a) of the Act, due to their knowledge of the prior sale.

The primary legal issues before the court were whether the applicant's knowledge of the prior sale was sufficient to constitute an "equity" that could override the indefeasibility of their title, and whether such equity required the presence of dishonesty to be effective. The court examined whether the applicant's knowledge could give rise to a cause of action based on the first limb of the Rule in Barnes v Addy, which pertains to knowing receipt of trust property. The court also considered whether the applicant held their registered title subject to a constructive trust and if the necessary intention was presumed, as would be the case in a resulting trust.

The court held that the applicant's knowledge of the prior sale did not create an equity sufficient to override the indefeasibility of their title. The court emphasised that for an equity to override indefeasibility, it must be more than mere knowledge; it must involve an active participation in a breach of trust or some form of dishonesty. The court found that the applicant's knowledge alone did not amount to a sufficient equity to sustain an action under the first limb of the Rule in Barnes v Addy. Consequently, the applicant's title remained indefeasible, and the court refused the applicant's application for leave to appeal.

Orders

Orders of the court

Application for leave to appeal refused

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

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