Warin v Registrar-General of Land HC Whangarei CIV 2006-488-000245

[2008] NZHC 2669

IN THE HIGH COURT OF NEW ZEALAND WHANGAREI REGISTRY

CIV 2006-488-000245

BETWEEN  MURRAY DARROCH WARIN, ROBYN WARIN, MALCOLM IAN JENSEN AND KATHARINA AGNES LOUISA ELIZABETH JENSEN

Plaintiffs

ANDREGISTRAR-GENERAL OF LAND First Defendant

ANDTHE MAORI TRUSTEE Second Defendant

Hearing:         6 December 2006 and 16 June 2008

Appearances: W W Peters and A Holgate (6 December 2006 only) for plaintiffs

J A L Oliver for first defendant

T K Williams and B Arapere (16 June 2008 only) for second defendant

R M Bell (16 June 2008 only) as amicus curiae

Judgment:      31 October 2008

JUDGMENT OF ALLAN J

This judgment was delivered by me on 31 October 2008 at 11 am pursuant to Rule 540(4) of the High Court Rules.

Registrar/Deputy Registrar

Solicitors:

Wayne W Peters & Associates, PO Box 5053, Whangarei  wwp@waynewpeters,co.nz

Crown Law Office (J Oliver), PO Box 2858, Wellington jo[email protected] Wackrow Williams & Davies (T K Williams), PO Box 461, Auckland [email protected]

Webb Ross (R Bell), Private Bag 9012, Whangarei  [email protected]

MD WARIN & ORS V REGISTRAR-GENERAL OF LAND AND ANOR HC WHA CIV 2006-488-000245 31

October 2008

Table of Contents

Introduction  [001] – [011] Background detail  [012] – [024] Res Judicata  [025] – [044] Abuse of process  [045] – [048] The Land Transfer Act  [049] – [058] Te Ture Whenua Maori Act 1993  [059] – [066] Application of Act to this case  [067] – [077] Invalidating provisions  [078] – [086] Indefeasibility  [087] – [129] Another Perspective  [130] – [133] Declaration  [134] – [135] Status Order  [136] – [140] Costs  [141] – [142] Leave Reserved  [143]

Introduction

[1]      This case is primarily concerned with the inter-relationship between the indefeasibility provisions of the Land Transfer Act 1952 (the LTA) and the Te Ture Whenua Maori Act 1993 (the Act).

[2]      Proceedings in this Court have been regrettably prolonged.  It is convenient to commence this judgment with a brief summary both of the factual background and of the manner in which the case developed in this Court.

[3]      In  1995,  the  plaintiffs  purchased  from  the  second  defendant  (the  Maori Trustee) a block of land situated at Whangaruru North Road, Bland Bay, Northland. The purchase price was $60,000.  The transfer was duly registered pursuant to the LTA.

[4]      In 2002, the plaintiffs sought to resell the land.  They entered into a contract for sale subject to two conditions:  firstly, the status of the land as general land was to be confirmed and, secondly, an apparent conflict between the records of the Maori Land Registry and of the District Land Registry as to ownership of the land was to be resolved.   The land proved to be Maori land rather than general land, as the plaintiffs had assumed, and the agreement for sale lapsed.

[5]      The plaintiffs applied to the Maori Land Court for an order changing the status of the land to general land.   The Court dismissed  that  application.    The plaintiffs subsequently applied for a rehearing.   At the same time, they sought a determination from the Maori Land Court that the plaintiffs were the owners of the land.   The Maori Land Court dismissed the latter application but adjourned the rehearing application.   The plaintiffs appealed to the Maori Appellate Court.   The appeal was dismissed but, of its own motion, that Court determined that a status order declaring the land to be Maori freehold land should be registered against the title to the land in the Land Transfer Office.   A status order was subsequently registered.

[6]      There is accordingly a conflict between the records of the first defendant and those of the Maori Land Court.  The register maintained by the first defendant under the provisions of the LTA records the plaintiffs as registered proprietors of the freehold estate in the land but subject to the status order issued by the Maori Appellate Court.   According to the records of the Maori Land Court, the second defendant remains the owner.

[7]     Against that background, the plaintiffs issued this proceeding under the Declaratory Judgments Act 1908 for “a declaration that the transfer registered under the LTA was legitimately registered and has the benefit of indefeasible title”.  The language of the declaration sought by the plaintiffs is somewhat inapt.  It raises two issues  rather than  one.    The phrase  “legitimately registered”  is  referable  to  the propriety of the procedures adopted by the plaintiffs and the second defendant, and is not a necessary part of the relief sought by the plaintiffs.  Their aim is to secure from the Court a declaration that the title they hold is protected by the indefeasibility provisions of the LTA and in particular ss 62 and 63.   I therefore indicated to counsel, without objection, that I would treat the plaintiffs’ claim as being for a declaration “that as transferees recorded in the transfer registered under the LTA they have the benefit of indefeasible title”.

[8]      During the course of the first hearing on 6 December 2006, Mr Peters, for the plaintiffs, sought an amendment to the prayer for relief by the addition of a claim for a second declaration to the effect that the status order registered against the title to the land under the LTA ought to be discharged.   There was no opposition to that application for amendment, which I duly granted.

[9]      At  the  conclusion  of  the  hearing  on  6  December  2006,  I  reserved  my decision.  As I prepared a judgment, it became apparent to me that I had not heard from all parties with a proper interest in the outcome of the proceeding. Counsel for the plaintiffs, the Registrar-General and the Maori Trustee all argued that the provisions  of  the  LTA  must  prevail  over  those  of  the  Act  and  that  the  first declaration ought to be granted.   I heard no argument to the contrary.   But before both the Maori Land Court and the Maori Appellate Court, a contrary argument had been put on behalf of those who stood to benefit from an outcome adverse to the

plaintiffs, namely the earlier beneficial owners and those within the preferred classes of alienee under the Act.

[10]     I  concluded  that  it  would  not  be  appropriate  for  the  Court  to  deliver  a judgment without hearing from counsel on behalf of those parties. Regrettably, the necessary arrangements proved time consuming.  Ultimately, however, I appointed Mr R M Bell to represent the opposing interests pursuant to the provisions of s 99 of the Judicature Act 1908.  Mr Bell was provided with all of the documents filed thus far in the proceeding, along with copies of written submissions provided to the Court at the hearing on 6 December 2006.

[11]     The proceeding was effectively reheard on 16 June 2008, all counsel filing fresh  written  submissions  and,  in  some  cases,  refining  the  arguments  earlier advanced.  All counsel addressed the Court at length.

Background detail

[12]     The land with which this proceeding is concerned was formerly part of a larger block of Maori freehold land.  On 22 March 1966, that larger block was vested in the second defendant pursuant to s 438 of the Maori Affairs Act 1953 (MAA) by order of the Maori Land Court.   Between 1966 and 1989, the second defendant devised and carried into effect a scheme for the subdivision of the block.   On

31 January 1989, plan 126453 was deposited in the Land Titles Office and titles were created for each of the individual sections thereby created.  Certificate of Title NA73D/366 was issued in respect of the plaintiffs’ land.   On 7 July 1995, the plaintiffs and the second defendant entered into an agreement pursuant to which the plaintiffs agreed to purchase the land.   Settlement of the purchase took place on

25 July  1995,  and  on  8 August  1995  the  first  defendant  registered  the  transfer pursuant to the provisions of the LTA.

[13]     Neither the plaintiffs nor the second defendant sought confirmation of the transfer from the Maori Land Court prior to registration under the LTA.   The plaintiffs say that they were unaware that the land was Maori land, there being no formal notation on the certificate of title to that effect.  The second defendant was, of

course, aware of the status of the land but it understood there was no requirement for confirmation in the particular circumstances of this case.  I will return to that point later in this judgment.   For present purposes, it is sufficient to note that it is not contended that the plaintiffs’ title is tainted by fraud.

[14]     There matters rested until 2002 when the plaintiffs endeavoured to sell the land.  As a result of enquiries made by the solicitors for the purchasers, the plaintiffs became aware for the first time that the land was Maori land and not general land, as they had supposed.  They applied to the Maori Land Court for an order approving a change of status of the land to general land.   That application was heard and dismissed on 18 June 2002.   The record of the proceedings in the Court on that occasion reads as follows:

S 135/93 Lot 32 DP 126453 being Pt Whangaruru Whakaturia No.4

Malcolm Jensen

Also  present:    Matatahi  George,  John  Liddingham.    We  purchased  this section from the Maori Trustee in 1995.  We did not make application to the Maori Land Court.  Our solicitor was Wayne Kaire.

Court.  The application asks that the Court perfects a title to land which has not been purchased in accordance with Te Ture Whanua Maori Act. Registration of a transfer has been accepted by the Land Titles Office.  There has been no mistake by this Court such that its error should be corrected. Rather, we have someone who is not on the title to the land pursuant to law seeking to change the status of the land which will in effect circumvent the law.  There has been a breach of the law for which this court has no jurisdiction to remedy in the manner which is sought by the applicant.

John Liddingham:  That’s crazy.

Malcolm Jensen:  This was a section sold by the Maori Trustee under the same procedure as it had previously sold sections.  It is only because of the law change in 1993 that this situation has arisen.  Nothing is different now from how it was then excepting for this law change.

Matatahi George:   I attend as chairman of the Ngatiwai Ki Whangaruru Whenua Kopu Trust.  I am concerned as to how this land obtained General Land title and also as to how these people could have purchased it.

Court:  The previous law referred to was a change of status brought about upon  the  registration  of  a  transfer  (s  2(2)(f)  of  the  1953  Act).    That provision, however, was repealed as at 01.07.93!  This land was purchased in 1995.

The Court has no jurisdiction to do what the applicant seeks.  Indeed, they have no standing, in effect, even to bring the application.  The comment that “This is crazy” is perhaps contempt for the law, which is a great pity.

The application is dismissed.  Mr George should perhaps direct his inquiry to the Maori Trustee as to his questions.

[15]     The plaintiffs made a fresh application to the Maori Land Court.  It was heard on 14 October 2002.  The plaintiffs sought:

a)       A rehearing of the earlier application for an order declaring the land to be general land;

b)Pursuant to s 18(1)(a) of the Act, an order directing that the records of the Maori Land Court be rectified so as to bring them into line with the records of the first defendant held pursuant to the LTA.

[16]     The first of these applications was adjourned pending the Court’s decision on the  second  application.  As  I  understand  the  position,  the  rehearing  application remains adjourned.

[17]     At the hearing of 14 October 2002, Mr Peters represented the plaintiffs and Mr Bell appeared as amicus curiae appointed under s 98 of the Act for those with an interest in the application.  By reason of Mr Bell’s submissions in this Court, it is necessary to set out the decision of the Maori Land Court delivered on 11 November

2002 in full.  It reads:

Decision:

On  14  October  2002  the  Court  heard  an  application  pursuant  to  s.

18(1)(a)/93 by Malcolm Jensen, one of the registered proprietors of Whangaruru  Whakaturia  4  Lot  32  DP  126453  Part  (C.T.  73D/366). Mr Jensen and others had purchased this section from the Maori Trustee in

1995.     They  had  previously  purchased  another  section  in  the  same subdivision from the Maori Trustee before the advent of Te Ture Whenua

Maori Act 1993.  They were unaware that the status of the land was now an issue in the purchase until they came to sell the same in January this year.

After discovering their problem, Mr Jensen filed an application to change the status of the land to General land. That application was heard on 18 June

2002 and dismissed (94 WH 133-134).  Also before the Court on 14 October

2002 was an application pursuant to s.43/93 to rehear that application.   It was adjourned pending the Court’s decision in this s 18(1)(a)/93 application.

During the hearing the Court wrote minutes summarising counsels’ submissions and Mr Jensen’s evidence.  They were read back to counsel and Mr Jensen during the hearing and were confirmed as an adequate record.  To avoid unnecessary repetition they are incorporated as a part of this decision.

The Determination of an equitable interest

Mr Peters submitted that the Court has jurisdiction pursuant to s.18(2)(a)/93 to find that, in equity, Mr Jensen and those he represents, are the persons entitled to the ownership of this land and that, by reason of the registration of a Memorandum of Transfer in the Land Titles Office on 08 August 1995, the Court may issue a declaratory consolidated order pursuant to s.128/93 bringing this Court’s record into line with the Land Titles Office record.  As authority for this proposition, he referred to the Maori Appellate Court decision in Haddon and Pakiri R Block (Case Stated 1/93).   Mr  Peters referred in particular to para. 63 of that decision.

Obligations of Maori Trustee as Vendor under Te Ture Whenua Maori

Act

The Vendor of the section was the Maori Trustee acting pursuant to powers conferred by orders of the Maori Land Court on 22 March 1966 and 5 June

1973 under s.438 Maori Affairs Act 1953 i.e. the Trust orders were not made under  the  provisions  of  Te  Ture  Whenua  Maori  Act  1993.    Mr  Peters

referred to s.354/93 and the decision of Deputy Chief Judge Smith in Re Whareroa 2E7B (21/12/94) which, he argued, found that trusts constituted under the previous enactment s. 438/93 were not subject to Part 12 of the

1993 Act by virtue of s.353/93.  This finding hinges on the interpretation of

“constituted” in s.354/93.  Not being bound by Part 12, Mr Peters argued, the purchase by Mr Jensen and others was not subject to confirmation under

s.228/93 (in force at that time) but rather only to noting by the Registrar

pursuant to s.161/93.

As the Court commented during the hearing, it is not persuaded by this argument.  If Re Whereroa is authority for this interpretation of s.354/93 and therefore the application  of  s.354/93,  I disagree  with  it.    The  provision s.354/93 commences with the words “Notwithstanding s.354/93 …” and then specifically deems trusts ordered under s.438(1)/53 to be ahu whenua trusts under the 1993 Act which are subject to Part 12 of the Act.

Accordingly,  s.228/93  (then  in  force)  and  s.151/93  apply.    The  Maori

Trustee’s power of sale was subject to s.228/93.

Indefeasibility by Registration

Turning now  to  the  argument  of  indefeasibility upon  registration  of  the transfer at the land Titles Office.  As noted during the hearing, s.126/93 is a new provision and the previous authority (Housing Corporation of N.Z v Maori Trustee [1988] 2 NZLR 662) is not of the same relevance. Indeed, this point was discussed at para’s 58-60 in Haddon and Pakiri R Block.  The provision specifically proscribes registration by the District Land Registrar where an instrument affecting Maori land and requiring confirmation by the Court has not first been confirmed by the Court.

Accordingly, the Court finds that the Memorandum of Transfer executed by the Maori Trustee purporting to give effect to the alienation by sale of Maori freehold land was subject to s.228(3)/93.   Until confirmed by the Court pursuant  to  s.151/93,  s.228(3)/93  renders  the  alienation  “of  no  force  or effect”.

Further, pursuant to s.126/93 and Reg. 16 Land Transfer Regulations, the Court finds that the District Land Registrar should not have registered the Memorandum of Transfer against C.T. 73D/366.   The proscription against registration without confirmation is consistent with s.228(3)/93.  The Court does not give any directions to the District Land Registrar, however, but rather leaves it to them to maintain the correctness of their record in accordance with their statutory duty (the enforcement of which is outside the jurisdiction of this Court).

Although not of direct relevance in this case, there was an interesting discussion of indefeasibility of Land Titles office registration by Ronald Young J in Edwards v Maori Land Court and Ors (C.P 78/01 – 11/12/01).  It concerned principally the registration of an order changing the status of the land and this Court’s jurisdiction pursuant to s.125/93 to require the District Land Registrar to register a subsequent annulment or revocation of its earlier order.     It  concludes  that  the  land’s  status  also  has  the  benefit  of indefeasibility.

The Court’s equitable jurisdiction

Having considered the substance of Mr Peters’ argument, the Court returns to the exercise of the Court’s discretionary, equitable jurisdiction under s.18(1)(a)/93.     The  Court  described  this  as  a  secondary  issue  at  the conclusion of its minute on 14 October 2002.  Despite being “secondary”, the Court could (but will not) examine the question in detail as it goes to the fundamentals of Te Ture Whenua Maori Act 1993.  The “fundamentals” are Maori – rangatiratanga and retention of Maori land by its owners, their whanau and their hapu, all enshrined in the Preamble  to the  Act.   The provisions of the Act give effect to those objectives.   Those of immediate relevance here are the definition of “preferred classes of alienees” in s.4/93 and the rights of those persons within that definition under s.147/93.  In this case, the purported transferees are not Maori.  Their claim to ownership by an alienation entered into contrary to law cannot be upheld in equity as it is also contrary to the objectives of the Act.  The “innocence” of their purchase may allow them to claim but does not enable the Court to determine that they have a right, title, estate or interest in the land.  Those who are within the preferred classes of alienees have a prior right (of first refusal) protected under the Act.   That they have an equitable interest was noted by Justice Ronald Young in Edwards.

Having entered into a contract with the Maori Trustee (and having done so previously for the purchase of another section prior to the 1993 Act coming into force), Mr Peters  argued  that  his clients  are “innocent”  purchasers. That, however, is not a criterion by which the Court could perfect their title. The Court must only by s.128(1) & (2)/93, make a consolidated order where a person is “entitled” to an estate or interest in the land.   Because by s.228(3)/93 the instrument registered in the Land Titles Office “is of no force or effect” for the purposes of effecting the alienation of Maori land, the transferees cannot be “entitled” for the purposes of s.128/93.

Accordingly, the Court does not find grounds for exercising its discretion under s.18(1)(a)/93 as the Applicant’s transaction does not come within the objectives  of  Te  Ture  Whenua  Maori  Act  1993.    Rather,  their  claim displaces an antecedent right of those within the preferred classes of alienees of the opportunity to be heard had there been an application pursuant to s.151/93 filed in the Court.

For the reasons set out above, the Application is dismissed.

Finally, there remains the outstanding s.43/93 application to rehear the previously dismissed s.135/93 application. Mr Peters may wish to advise the Court whether he will proceed with that application.

[18]     The plaintiffs appealed from that decision to the Maori Appellate Court.  The appeal hearing took place on 14 May 2003.   Again, Mr Peters appeared for the plaintiffs.   Again, those with a contrary interest were represented by counsel, this time Mr Harte.  The decision of the Maori Appellate Court was given on 10 October

2003.  The Appellate Court identified three major issues:

(1)A question of law, namely whether the restrictions on alienation prescribed under section 228 of Te Ture Whenua Maori Act 1993 apply to a Trust created under section 438 of the Maori Affairs Act

1953;

(2)Whether, on the particular facts of this case, the Court should make an order under section 18(1)(a) of Te Ture Whenua Maori Act 1993 conferring Maori Land Court title to Whangaruru-Whakuturia 4 Lot

32 DP 126435 (lot 32) on the appellant and others.   This would accord with Land Transfer title 73D/366 to that land, which is held

by the appellant and those other persons; and

(3)Whether, regardless of the determination of the above issue, the registration in the Land Transfer Office of the transfer of lot 32 to the appellant and his co-owners and the doctrine of indefeasibility of Land Transfer title dictates that the Court should amend the Maori land title to accord with the Land Transfer title.

[19]     On the first of  these questions,  the Maori  Appellate Court  held  that  the provisions of s 228 of the Act did apply to a trust created under s 438 of the Maori Affairs Act 1953.  In so doing, the Court declined to follow the decision of Deputy Chief Judge Smith in Re Whareora 2E 7B Block, the case upon which the second defendant had relied when it omitted to apply to the Maori Land Court for confirmation of its sale to the plaintiffs.

[20]     The Appellate Court decided also to uphold the refusal of the Maori Land Court to make an order in favour of the plaintiffs under s 18(1)(a) of the Act.  The Court summarised its reasoning on this issue in the following way:

Even if the lower court erred in some of its reasoning (which is not a finding of this court) that does not necessarily render its decision wrong.   For the appellant to succeed in this appeal, he needed to establish grounds sufficient for a finding on equitable principles to convince this court that the decision of the lower court was wrong.

He has failed to do that for the following reasons:

(1)We cannot agree that the appellant can be regarded as an innocent party to the transaction.  The Act provides certain procedures which a purchaser must follow before he can acquire good title to Maori land.   If  a  purchaser  engages  somebody to  act  on  his  behalf to complete the transaction and that person fails to ensure compliance with the provisions of the Act, then the purchaser cannot divorce himself from the actions of his agent.   The failure taints the transaction and attaches to the purchaser, in this case the appellant. If  the  appellant  has  a  remedy,  it  would  be  in  respect  of  the inadequacy of advice received.

(2)Mr Peters has presented to us no examples of precedent or doctrines of equity which might apply to a situation such as this.  Furthermore there is no evidence of misrepresentation or implied representation which might support considerations of equity.

(3)We are left with the situation of an appellant who has failed to comply with the provisions of the Act seeking the indulgence of the Court to grant a decision in his favour.

(4)The objectives of the Act are aimed at the retention of Maori land by Maori, although certain provisions allow for alienation subject to protective  procedures  being  followed.     To  make  an  order  on equitable  grounds  in  favour  of  the  appellant  and  his  fellow purchasers in these circumstances would seriously undermine the operation of the Act.

(5)Taking all the above matters into account we are unable to conclude that  the  equitable  considerations  supporting  the  case  for  the appellant are sufficient to override the kaupapa of the Act, which is to protect Maori land.

[21]     The  Maori  Appellate  Court  declined  to  make  a  determination  upon  the question identified at the outset of its decision as issue 3, namely the impact of the doctrine of indefeasibility under the LTA.  Given the thrust of Mr Bell’s argument in this Court, it is important to set out in full the passage in the Appellate Court decision that deals with this topic:

Somewhat surprisingly Mr Peters made no submissions based on indefeasibility of title under the Land Transfer Act. When this was put to Mr Peters he responded by saying that his client already had legal title and it was the Maori Land Court title that needed to be brought in line.

Mr Harte considered that indefeasibility of title was relevant. He submitted that where differences arise between the Land Transfer title and Maori land title, the court has jurisdiction under section 128 to make a declaratory order as to title resolving those differences.

There is strong precedent in favour of the principle of indefeasibility of Land Transfer title following registration.   Against this has to be measured the objectives and principles of Te Ture Whenua Maori Act 1993 and the intent of the legislation.  Mr Harte referred to this very fact in citing the case of Miller  v.  Minister  of  Mines  [1963] NZLR 560 (PC). The 1993 Act empowers the making of orders under section 128 settling differences of the two title systems and directs (under section 124) that all orders of the court shall be registered. Sections 44 and 48 are further indicative that orders of the court may impact upon existing Land Transfer title. The provisions of the Illegal Contracts Act 1970 in providing first that illegal contracts are of no force and effect and secondly an avenue of relief may well reinforce the argument that Te Ture Whenua Maori Act 1993 should prevail where Maori land is at issue.

Because of Mr Harte’s submissions and our awareness that indefeasibility is a general issue affecting title we headlined it as an issue.   However upon reflection we believe that it is not appropriate that we consider this issue.

Our reasons are that first that Mr Peters has not raised it for consideration as part of his application under section 18(1)(a).   The court has therefore no need to consider it.  Secondly, if it is to consider this issue as part of these proceedings it would need to invoke its wider jurisdiction under section 128. Natural justice requires that notice needs to have been given to the parties.  It is appropriate that the issue be first dealt with in the lower court rather than an appellate forum.

[22]     Finally, the Maori Appellate Court decided of its own motion to make a status order determining the land in question to be Maori land and directing registration of a status order under the LTA.  That order was made in reliance upon s

131 of the Act.

[23]     In the result, the appeal was dismissed save for the making of the status order, with the result that the decision of the Maori Land Court was affirmed.  It was against that background that the plaintiffs brought the present proceeding seeking declaratory relief.

[24]     Mr Oliver, for the first defendant, argues that notwithstanding the decisions reached by the Maori Land Court and the Maori Appellate Court, the plaintiffs enjoy

indefeasible title and that accordingly it is not appropriate that the first defendant amend  the  relevant  certificate  of  title.  He  is  supported  by  Mr  Peters  and  by Mr Williams for the Maori Trustee.    On the other hand, Mr Bell submits that the second defendant, the Maori Trustee, is the owner of the land notwithstanding registration under the LTA.  He advances two principal arguments:

a)       In the circumstances of this particular case the plaintiffs are estopped from maintaining this proceeding by virtue of  the doctrine of res judicata.  Alternatively, he argues that this proceeding amounts to an abuse of process.

b)In any event, upon its true construction the Act must be taken to override the indefeasibility provisions of the LTA with the result that transferees who (as here) fail to obtain the confirmation of the Maori Land Court are unable to secure an indefeasible title under the LTA – in other words, in such circumstances, the records of the Maori Land Court must prevail over the register maintained under the LTA.

Res judicata

[25]     Mr Bell argues that the plaintiffs are precluded from obtaining any relief in this proceeding because they are unable to rebut the defences of cause of action estoppel and issue estoppel advanced by him.  The classic modern exposition of the relevant principles is to be found in Thoday v Thoday [1964] 1 All ER 341 (CA) where, at 352, Diplock LJ (as he then was) said:

The particular type of estoppel relied on by the husband is estoppel per rem judicatam.  This is a generic term which in modern law includes two species. The first species, which I will call “cause of action estoppel”, is that which prevents a party to an action from asserting or denying, as against the other party, the existence of a particular cause of action, the non-existence or existence of which has been determined by a court of competent jurisdiction in previous litigation between the same parties.  If the cause of action was determined to exist, i.e. judgment was given on it, it is said to be merged in the judgment, or, for those who prefer Latin, transit in rem judicatam.  If it was determined not to exist, the unsuccessful plaintiff can no longer assert that it does;  he is estopped per rem judicatam.  This is simply an application of the rule of public policy expressed in the Latin maxim, “nemo debet bis vexari pro una et eadem causa”.   In this application of the maxim, causa

bears its literal Latin meaning.  The second species, which I will call “issue estoppel”, is an extension of the same rule of public policy.  There are many causes of action which can only be established by proving that two or more different conditions are fulfilled.   Such causes of action involve as many separate issues between the parties as there are conditions to be fulfilled by the plaintiff in order to establish his cause of action;  and there may be cases where the fulfilment of an identical condition is a requirement common to two or more different causes of action. If in litigation on one such cause of action any of such separate issues whether a particular condition has been fulfilled  is  determined  by  a  court  of  competent  jurisdiction,  either  on evidence or on admission by a party to the litigation, neither party can, in subsequent litigation between them on any cause of action which depends on the  fulfilment  of  the  identical  condition,  assert  that  the  condition  was fulfilled if the court has in the first litigation determined that it was not, or deny that it was fulfilled if the court in the first litigation determined that it was.

[26]     Mr Bell says that the cause of action in the proceeding in the Maori Land Court was a claim that the land was owned absolutely by the plaintiffs.   While accepting that the plaintiffs’ claim  in  the  present  proceeding is  expressed more narrowly than that, he argues that it nevertheless:

… falls entirely inside the cause of action raised in the Maori Land Court application. The issues in this Court are more confined … [the plaintiffs] are saying that, notwithstanding the failures to comply with Te Ture Whenua Maori Act, upon registration they became registered proprietors of the land. That is a repetition of their claim in the Maori Land Court that they became owners.

[27]     Alternatively, Mr Bell argues that the indefeasibility issue is common to the proceeding in the Maori Land Court and to this present proceeding, because, he argues, the question was determined in the Maori Land Court and, because on appeal the Maori Appellate Court declined to rule on the question, the plaintiffs are bound by the adverse determination in the lower Court.

[28]    Proceedings in the Maori Land Court are not governed by conventional pleadings.   The plaintiffs’ second application to that Court was made pursuant to s 18(1)(a) of the Act which provides:

18     General jurisdiction of Court

(1)       In addition to any jurisdiction specifically conferred on the Court otherwise  than  by  this  section,  the  Court  shall  have  the  following jurisdiction:

(a)     To hear and determine any claim, whether at law or in equity, to the ownership or possession of Maori freehold land, or to any right, title, estate, or interest in any such land or in the proceeds of the alienation of any such right, title, estate, or interest …

[29]     The plaintiffs’ application was filed by Mr Peters.  As is material it reads:

FORM 1

GENERAL FORM OF APPLICATION

Rule 12 (2)

APPLICATION FOR

Te Ture Whenua Maori Act 1993

Section 18(1)(a)

IN THE MAORI LAND COURT OF NEW ZEALAND

TAI TOKERAU DISTRICT        IN  THE  MATTER  of  Lot  32  DP  126453

being part Whangaruru Whakaturia No. 4 (“the land”) being the land in CT 73D/366

APPLICATION  is hereby made for a determination under Section 18(1)(a) of Te Ture Whenua Maori Act 1993 THAT the land is owned absolutely by the following persons (“the current registered proprietors”) they being the registered proprietors of the land:

Murray Darroch Warin, Robyn Warin jointly as to an undivided ½ share, Malcolm Ian Jensen and Katharina Agnes Louisa Elisabeth Jensen jointly as to an undivided ½ share as tenants in common in the said shares.

UPON THE GROUNDS THAT

1)        prior to the registration of the transfer to the current registered proprietors the previous registered proprietor of the land was the Maori Trustee acting pursuant to s438 of the Maori Affairs Act 1953 (now s215 Te Ture Whenua Maori Act 1993)

2)        the Maori Trustee and the current registered proprietors entered into an agreement for sale and purchase dated 7 July 1995 (“the agreement”) in respect of the land by which the land was to be sold by the Maori Trustee to the current registered proprietors

3)        the sale of the land pursuant to the agreement was settled on or about 28

July 1995 and in consideration of the payment of the purchase price the Maori Trustee  gave  to  the  solicitor  acting  for  the  current  registered  proprietors  a registerable transfer of the land to them

4)        the Memorandum of Transfer was registered against CT 73D/366 in respect of the land on 8 August 1995 under C874886.1

5)        there is conflict between the Maori Land Court register and the register maintained by the District Land Registrar in respect of the land and the determinations sought by way of this application will rectify the anomalies that exist in that regard

6)        it is fair just and proper that the Court make the determinations ought in this application

7)        whilst this application is made by Malcolm Ian Jensen being one of the current registered proprietors the application is made on behalf of all of the current registered proprietors.

[30]     It is to be noted that the grounds set out in the application do not include a claim that the plaintiffs were entitled to succeed in the Maori Land Court simply by virtue of their registered title to the land.   From the bar in this Court, Mr Peters advised that he had expressly disavowed any reliance in the Maori Land Court on an indefeasibility argument;  that was because, in his view, the Maori Land Court had no jurisdiction to entertain it.

[31]     Mr   Bell,   appearing   as   amicus   in   the  Maori   Land   Court,   did   raise indefeasibility issues there in order to argue, as in this Court, that the scheme of the Act prevailed over the indefeasibility provisions of the LTA.

[32]     The decision of the Maori Land Court of 11 November 2002 requires careful analysis.  The Court found that the transaction between the plaintiffs and the second defendant,  and  more  particularly  the  memorandum  of  transfer  executed  by  the second defendant, were subject to 228(3) of the Act and accordingly the memorandum of transfer was of no force and effect unless confirmed by the Court. It also found that by virtue of s 126 of the Act, the District Land Registrar should not have registered the memorandum of transfer.   Those findings are unexceptionable, and were indeed inevitable having regard to the provisions of ss 228 and 126.  But the Maori Land Court stopped short of finding that, notwithstanding the provisions of ss 62 and 63 of the LTA, the plaintiffs were not entitled to maintain their claim to priority over the interest of the Maori Trustee by virtue of their status as registered proprietors.

[33]     There is a reference in the decision to Housing Corporation of New Zealand v Maori Trustee [1988] 2 NZLR 662, a case decided under the MAA, often cited in support of the primacy of indefeasibility principles in the context of that former Act. The Maori Land Court noted that that case was “… not of the same relevance …” by reason of the introduction of s 126 in the new Act.

[34]     The Maori Land Court also referred to the decision of this Court in Edwards v Maori Land Court HC WN CP78/01 11 December 2001 in which Ronald Young J

held that a status order, once registered under the LTA, conferred indefeasibility protection upon the registered proprietor.  Notably, however, the Maori Land Court held that case to be of no direct relevance.

[35]     The discussion of indefeasibility principles in the decision of the Maori Land Court is brief and, in my view, does not amount to a finding against the plaintiffs in respect of indefeasibility.  That was plainly the view of the Maori Appellate Court as well.  That Court analysed the ratio of the decision in the Court below, as follows:

(i)By virtue of section 354/93 the section 438/53 Trust became an Ahu Whenua Trust under the 1993 Act and subject to the provisions of Part XII thereof which included section 228;

(ii)       Under section 228/93 the Maori Trustee was precluded from selling the land without firstly the consent of 75% of the owners and secondly  confirmation  by  the  Maori  Land  Court  under  section

151/93;

(iii)      Neither consent nor  confirmation  was  obtained  and by virtue  of section 228/93 the transfer was “of no force and effect”;

(iv)      The applicants’ claim to ownership was contrary to law and outside the objectives of the 1993 Act;

(v)       The Court therefore did not find grounds to exercise its discretion under section 18(1)(a)/93.

[36]     Clearly, the Maori Appellate Court did not regard the Maori Land Court as having made a  decision  on  the  question  before this  Court,  namely whether  the plaintiffs’  registered  title  under  the  LTA  survives,  notwithstanding  a  failure  to comply with the requirements of the Act.  The point is important in respect of the doctrine of issue estoppel because, as is pointed out in Talyancich v Index Developments Ltd [1992] 3 NZLR 28, such an estoppel may be founded only on determinations which are fundamental to a decision and without which it cannot stand. Other determinations will not support an issue estoppel, however definite the language in which they are expressed. The relevant passage in the judgment of McKay J, delivering the judgment of the Court, is worth reproducing at length (38):

As is pointed out by Spencer Bower & Turner at p 179, para 210, an issue estoppel can only be founded on determinations which are fundamental to the decision and without which it cannot stand.  Other determinations cannot support an issue estoppel however definite the language in which they are expressed.    What  is  emphasised  in  the  judgments  cited  is  that  for  the

decision on any matter to give rise to an issue estoppel that matter must be one which it was necessary to decide and which was actually decided.  The authorities include the following statements of the principle:

“… the judgment concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide, and which was actually decided, as the groundwork of the decision itself, though not then directly the point at issue” (per Coleridge J in R v Inhabitants of Hartington Middle Quarter (1855) 4 El & Bl 780, at p 794).

“The former judgment was pronounced by the Australian Courts under that section [s 37(7) of the Land Tax Assessment Act].  It was not merely incidental or collateral to the question so decided that the appellants were joint owners. It was fundamental to it.  Unless it had been decided that under the settlement, Mr Campbell’s children had a beneficiary interest in land or income in such a way as they are taxable as joint owners’ they could not have been taxed at all” (per Lord Shaw in Hoystead v Taxation Commissioner [1926] AC 155,

171-172).

“It is well settled that a judgment concludes not merely the point decided but matters which were necessary to decide and which were actually decided as the groundwork of the decision itself though not then directly the point at issue and that a judgment is conclusive evidence not merely of the facts directly decided but of those facts which are necessary steps to the decision – so cardinal to it that without them it cannot stand” (per Starke J Blair v Curran (1939) 62

CLR 464, 510).

The learned authors of Spencer Bower & Turner refer at p 182 para 211 to the useful test of asking whether it was possible to appeal against the finding which is being put forward as founding an estoppel.   If there can be no effective  appeal  against  the  particular  determination,  it  is  impossible  to regard it as fundamental to the judgment. They continue at p 186 para 215:

“To recall the statement of principle from the judicial pen of COLERIDGE J, set out in an earlier paragraph, the question as to findings or decisions not expressly set out in the formal record (ie the sealed judgment or order) is as to what matters were necessary to decide,  and  actually decided,  as the groundwork of  the  decision itself. Not every finding of fact in a judge’s judgment, not every issue of fact determined by a judge or jury, is res judicata between the parties in later proceedings.   Thus, a decision of fact or law against the party in whose favour the substantial dispute was ultimately decided will not found an estoppel in a later proceeding; and this is because it cannot have been necessary to the substantive decision. … And a similar argument may apply to cases where, of several available factual grounds alternatively advanced as the basis of a cause of action, the court (or a jury in issues put to it) has determined more than one in favour of the party who ultimately succeeds on the main issue. No estoppel can be founded on any one of the findings, for it is obvious that the party failing on such issues cannot appeal on any of them separately.  In order to succeed on an appeal he must succeed on all the issues, and if the finding on even

one of them be good this will be fatal to an appeal on any of the others.”

[37]     Before there can be an issue estoppel it must be possible to say positively and without room for doubt that the issues are identical:   Shiels v Blakeley [1986] 2

NZLR  262  at  267,  New  Brunswick  Railway  Co  v  British  &  French  Trust

Corporation Ltd [1939] AC 1.

[38]     The ratio of the Maori Land Court decision was that there had been a failure to comply with the provisions of the Act, that the memorandum of transfer was of no force and effect (s 228), that the District Land Registrar ought not to have registered it (s 126), and that the plaintiffs’ application could not succeed because the alienation by the second defendant was “ … contrary to law [and] cannot be upheld in equity as it is also  contrary to  the  objectives  of  the  Act”.    Mr  Peters  did  not  rely upon indefeasibility principles.  Although they were discussed by the Maori Land Court, they did  not  form  part  of  the  ratio  of  its  decision,  which  was  based  upon  the plaintiffs’ inability to show that they were entitled to succeed in equity.

[39]     There was no finding on the indefeasibility issue in the Maori Appellate Court either, but for different reasons.   That Court was prepared to deal with the issue but Mr Peters took the same line as he had in the Court below, namely that he relied simply upon the existence of the registered title as one of the circumstances justifying an order (based upon equitable considerations) in the plaintiffs’ favour. Mr Harte, for the opposing parties, did address indefeasibility matters.  The Maori Appellate Court noted that there were arguments either way but expressly decided not to determine the issue.  Its reasons for not doing so are instructive and indeed, in my view, determinative on the estoppel point.

[40]     First, the Maori Appellate Court said that Mr Peters had not raised the issue for consideration and that the Court had no need to consider it.   But, second, and crucially, it noted that in order to consider indefeasibility issues the Court would need to invoke its jurisdiction under s 128, which provides:

128    Court may issue declaratory consolidated order

(1)    This section applies to any case where any instrument of title (whether or not registered under the Land Transfer Act 1952) issued with respect to

any Maori freehold land does not fully disclose the names of the several persons for the time being entitled to any estate or interest in that land and the several shares and interests to which they are so entitled as a result of changes of ownership effected or evidenced by subsequent orders of the Court or of a Registrar, or certificates or other documents recorded in the records of the Court or in the Land Transfer Office.

(2)     In any case to which this section applies, the Court may, in accordance with the provisions of this section, make a consolidated order declaring, as at the date of the order, the names of the persons who, by virtue of the instrument of title or the subsequent orders, certificates, or other documents referred to in subsection (1) of this section, are then entitled to any estate or interest in the land and the several shares and interests to which they are so entitled.

(3)      Where a beneficial owner named in the original instrument of title or in any subsequent order has died, whether before or after the commencement of  this  Act,  and  in  respect  of  the  beneficial  interest  of  that  owner  a succession order has been made under any former Act or a vesting order has been made under section 136 of the Maori Affairs Act 1953 or under section

117 or section 118 of this Act, vesting the interest of the deceased owner in a trustee pursuant to the will of the deceased, the trustee shall be deemed to be the beneficial owner of that interest for the purposes of the consolidated order,  and  the  existence  of  the  trust  shall  be  disclosed  in  the  order  by reference to the will of the deceased owner.

(4)     The consolidated order shall be made to incorporate the effect of any order affecting the ownership of any interest made by the Court subsequent to the drawing up of the draft consolidated order.

[41]     There had been no reliance on the Court’s powers under s 128 either in the Maori Land Court or in the Maori Appellate Court.  The latter Court considered that natural justice required that notice of a s 128 application would need to be given to the parties and, importantly, that the issue ought first to be dealt with in the lower Court rather than in the appellate forum. These last observations on the part of the Maori Appellate Court are indicative of that Court’s view that:

a)       the proceedings before the Maori Land Court and before the Maori Appellate  Court  under  s  18(1)(a)  were  not  of  sufficient  scope  to justify consideration by the Court of the impact of the new Act upon the indefeasibility provisions of the LTA;  and that

b)the  proceedings  in  the  Maori  Land  Court  had  not  dealt  with indefeasibility issues other than in passing – that is apparent from the

Maori Appellate Court’s comment to the effect that such issues ought to be dealt with first in the lower Court.

[42]     As is clear from the passage in Thoday v Thoday set out earlier, cause of action estoppel and issue estoppel are somewhat different concepts.   In the proceedings of ordinary civil Courts where the Court and the parties have the advantage of carefully drafted pleadings, the difference will be apparent enough. However, here, where the proceedings are commenced by a simple application and without formal pleadings, the distinction is somewhat blurred.  It is not, in my view, sufficient for Mr Bell to contend that the plaintiffs are estopped simply because their application under s 18(1)(a) of the Act was unsuccessful.  The issues raised in the present proceeding are relatively narrow.  Mr Peters carefully refrained from relying before either the Maori Land Court or the Maori Appellate Court on the argument now raised in this Court.   In those Courts, the plaintiffs failed by reason of non- compliance with the provisions of the Act and by reason of the plaintiffs’ inability to demonstrate that they qualified for relief in equity under s 18 of the Act.

[43]     In my opinion, neither issue estoppel nor cause of action estoppel arises here. The present proceeding does not, in my view, “fall entirely within” the cause of action in the Maori Land Court, as Mr Bell contends.  It is a different cause of action based upon the plaintiffs’ registered title under the LTA.  The former proceedings were aimed at securing registration of the plaintiffs’ ownership in the records of the Maori Land Court and were based on equitable grounds.

[44]     Before leaving this topic, it is relevant to note that Mr Peters did not contend that  a  distinction  was  to  be  drawn  between  Mr  Jensen,  who  was  the  primary applicant in proceedings before the Maori  Land Court and the Maori Appellate Court, and the remaining plaintiffs.  The applications to those Courts were made by Mr Jensen on behalf of all of the plaintiffs as registered proprietors.   They were accordingly his privies for the purposes of the law of estoppel.

[45]     Mr Bell advances an alternative argument to the effect that even if a plea of res judicata is not made out, this case nevertheless amounts to an abuse of process. In the particular circumstances of this case there is, in my opinion, very little difference between estoppel on the one hand, and abuse of process on the other. They are, to a degree, overlapping concepts:  see NZ Social Credit Political League v O’Brien [1984] 1 NZLR 84 at 95, where Somers J said:

Estoppel per rem judicatam, issue estoppel, and abuse of process in at least one of its manifestations, may be seen as exemplifying similar concepts – that a matter once determined may not be again litigated, that a matter which could and should have been raised in proceedings which have been determined should not be allowed to be raised subsequently, and that a collateral attack upon a final decision in other proceedings will not be permitted.  The dual objects are finality of litigation and fair use of curial procedures.

[46]     In Hunter v Chief Constable of West Midlands [1981] 3 All ER 727 (the

‘Birmingham Bombers’ case) Diplock LJ said (at 733):

The abuse of process which the instant case exemplifies is the initiation of proceedings in a Court of justice for the purpose of mounting a collateral attack on a final decision against the intending plaintiff which has been made by another court of competent jurisdiction in previous proceedings in which the intending plaintiff had a full opportunity of contesting the decision in the court by which it was made.

[47]     In the particular circumstances of this case, the abuse of process argument raises issues that are effectively the same as earlier discussed in the context of Mr Bell’s estoppel argument.  The present proceeding does not, in my view, amount to an abuse of process because the issue upon which the plaintiffs seek the Court’s determination, namely their status as registered proprietors under the LTA in the context of the Act, was not raised by the plaintiffs before either the Maori Land Court or the Maori Appellate Court and was not the subject of a determination by either Court.

[48]     In the light of these preliminary findings, it is necessary now to turn to a consideration of the substance of the plaintiffs’ claim.

[49]     At the heart of the Torrens system upon which the LTA is based lies the concept of security of title conferred by registration.   The principles are widely understood and it is unnecessary to do more than summarise them briefly.

[50]     The centrality of the act of registration is emphasised in a helpful passage which appears in Hinde McMorland & Sim, Land Law in New Zealand (LexisNexis, loose-leaf volume, 2003) at 9.001:

9.001   Title passes by registration

One of the essential working features of an effective system of registration of title is that title must depend on the act of registration and not on the documents upon the basis of which registration proceeds.   In the Land Transfer Act 1952 this principle is embodied in s 41(1), which provides that:

No instrument shall be effectual to pass any estate or interest in any land under the provisions of this Act, or to render any such land liable, as security for the payment of money, but, upon the registration of any instrument under this Act or the Land Transfer (Computer Registers and Electronic Lodgement) Amendment Act
2002, the estate or interest specified in the instrument shall pass, or, as the case  may be, the land shall become liable as  security in manner and subject to the covenants, conditions, and contingencies set forth and specified in the instrument, or by this Act declared to be implied in instruments of a like nature.

The subjection first of all takes from instruments any force which the common law might have given them.  Having done this, it goes on to say that upon registration the estate or interest specified in the instrument “shall pass”.  Even when the instrument is registered, it is not the instrument which passes the estate or interest, but the state itself.  Before the introduction of computer registration it was the act of the Registrar or other authorised officer of the Land Registry Office in signing or authenticating the memorial in the register that passed the estate or interest.  Under the present computer registration  system  (Landonline)  it  is  the  Landonline  computer  which transfers title to the estate or interest by assigning a unique identifier to the instrument and entering it in the computer register.  Thus the fundamental principle of the Torrens system embodied in s 41(1) of the Land Transfer Act 1952 continues to apply.

[51]     The  security  of  title  which  the  LTA  is  intended  to  confer  is  expressly guaranteed by ss 62 and 63 which provide:

62        Estate of registered proprietor paramount

Notwithstanding the existence in any other person of any estate  or interest, whether derived by grant from the Crown or otherwise, which

but for this Act might be held to be paramount or to have priority, but subject to the provisions of Part 1 of the Land Transfer Amendment Act

1963, the registered proprietor of land or of any estate or interest in

land under the provisions of this Act shall, except in case of fraud, hold the same subject to such encumbrances, liens, estates, or interests as may be notified on the folium of the register constituted by the grant or certificate of title of the land, but absolutely free from all other encumbrances, liens, estates, or interests whatsoever,—

(a)       Except the estate or interest of a proprietor claiming the same land under a prior certificate of title or under a prior grant registered under the provisions of this Act; and

(b)Except so far as regards the omission or misdescription of any right of way or other easement created in or existing upon any land; and

(c)Except so far as regards any portion of land that may be erroneously included in the grant, certificate of title, lease, or other instrument evidencing the title of the registered proprietor by wrong description of parcels or of boundaries.

63        Registered proprietor protected against ejectment

(1)No action for possession, or other action for the recovery of any land, shall lie or be sustained against the registered proprietor under the provisions of this Act for the estate or interest in respect of which he is so registered, except in any of the following cases, that is to say:

(a)  The case of a mortgagee as against a mortgagor in default: (b) The case of a lessor as against a lessee in default:

(c)  The case of a person deprived of any land by fraud, as against the person registered as proprietor of that land through fraud, or as against a person deriving otherwise than as a transferee bona fide for value from or through a person so registered through fraud:

(d) The case of a person deprived of or claiming any land included in any grant or certificate of title of other land by misdescription of that other land, or of its boundaries, as against the registered proprietor of the other land, not being a transferee or deriving from or through a transferee thereof bona fide for value:

(e) The case of a registered proprietor claiming under the instrument of title prior in date of registration, under the provisions of this Act, in any case in which 2 or more grants or 2 or more certificates of title, or a grant and a certificate of title, may be registered under the provisions of this Act in respect to the same land.

(2)In  any  case  other  than  as  aforesaid,  the  production  of  the register or of a certified copy thereof shall be held in every

Court of law or equity to be an absolute bar and estoppel to any such action against the registered proprietor or lessee of the land the subject of the action, any rule of law or equity to the contrary notwithstanding.

[52]     The  ambit  of  these  sections  was  discussed  and  explained  in  the  leading decision of the Privy Council in Frazer v Walker [1967] NZLR 1069, where at 1074-

5 it was said:

The relevant sections may be considered under five main headings:

…

(2)       Those sections which provide protection to the registered proprietor against claims and proceedings. These are ss 62 and 63.  Without attempting any comprehensive or exhaustive description of what these sections achieve, it may be said that while s  62 secures that  a registered  proprietor,  and consequently anyone who deals with him, shall hold his estate or interest absolutely free from encumbrances, with three specified exceptions,   s 63 protects him against any action for possession or recovery of land, with five specified exceptions.  Subsection (2) of s 63 is a particularly strong provision in his favour:  it provides that the register is, in every Court of law or equity, to be an absolute bar to any such action against the registered proprietor, any rule of law or equity to the contrary notwithstanding.  It is to be noticed that each of these sections excepts the case of fraud, s 62 employing the words “except in case of fraud”, and s 63 using the words “as against the person registered as proprietor of that land through fraud”.  The uncertain ambit of these expressions has been limited by judicial decision to actual fraud by the registered proprietor or his agent.  (See Assets Co Ltd v Mere Roihi [1905] AC 176, 210; [1905] NZPCC 275, 298.)

It is these sections which, together with those next referred to, confer upon the registered proprietor what has come to be called “indefeasibility of title”. The expression, not used in the Act itself, is a convenient description of the immunity from attack by adverse claim to the land or interest in respect of which he is registered, which a registered proprietor enjoys.  This conception is central in the system of registration.  It does not involve that the registered proprietor is protected against any claim whatsoever;  as will be seen later, there are provisions by which the entry on which he relies may be cancelled or corrected, or he may be exposed to claims in personam.  These are matters not to be overlooked when a total description of his rights is required.  But as registered proprietors, and while he remains such, no adverse claim (except as specifically admitted) may be brought against him.

[53]     A further useful summary appears in the judgment of Barker J in Merbank

Corporation Ltd v Cramp [1980] 1 NZLR 721 at 728:

The situation under the Torrens system is summarised succinctly in the joint judgment of Isaacs and Rich JJ in the High Court of Australia in Commonwealth v State of New South Wales (1918) 25 CLR 325, 342 where,

referring generally to equivalent provisions relating to transfer of title, it was said:

‘It is not the parties who effectively transfer the land, but it is the State that does so, and in certain cases more fully than the party could.’

This was a dissenting judgment but the dissent was not on this particular point. See also Hinde McMorland & Sim, Land Law (1978) vol 1, para

2.050.

Helpful dicta found in the post-Frazer v Walker era are found in Australia: (a)       Barwick CJ said in Breskvar v Wall (1971) 126 CLR 376, 385-386:

‘The Torrens system of registered title of which the Act is a form is not a system of registration of title but a system of title by registration.   That which the certificate of title describes is not the title which the registered proprietor formerly had, or which but for registration would have had.   The title it certifies is not historical or derivative. It is the title which registration itself has vested in the proprietor. Consequently, a registration which results from a void instrument is effective according to the terms of the registration.   It matters not what the cause or reason for which the instrument is void.  The affirmation by the Privy Council in Frazer v Walker of the decision of  the  Supreme  Court  of  New Zealand  in  Boyd  v Mayor, &c, of Wellington, now places that conclusion beyond question.’

(b)      Street J in the Supreme Court of New South Wales in Mayer v Coe

[1968] 2 NSWR 747, 754 said:

‘The Privy Council’s decision is direct and binding authority laying down that a registered proprietor who acquires his interest under an instrument void for any reason  whatever  obtains  on  registration  an indefeasible title.   This will avail him against all comers unless:

(a)there  is  a  specific  basis  under  the  statute rendering him open to challenge … ;  or

(b)he is subject to a personal obligation by which he may be bound in personam to deal with his registered title in some particular manner.’

[54]    As is noted by Barker J, even a void instrument will confer title upon registration in the absence of fraud:  Boyd v Mayor of Wellington [1924] NZLR 1174 and Mayer v Coe [1968] 2 NSWR 747.

[55]     But   it   is   well   established   that   there   are   certain   exceptions   to   the indefeasibility  principle.     An  example  is  the  enactment  of  a  statute  that  is inconsistent  with  those  provisions  of  the  LTA  that  confer  an  absolute  and indefeasible title on the registered proprietors.   Such an instance arose in Miller v Minister of Mines [1963] AC 484, where the appellant held a certificate of title to land which contained no reference to any rights of the Crown over the land. The Crown enjoyed certain mining rights, the registration of which were regulated by the Mining Act 1926. It was held by the Privy Council that the Crown’s mining rights prevailed over the absolute and indefeasible title which was assured to the registered proprietors of the land under the LTA. The Privy Council said that there was no need for any express provision overriding the provisions of the LTA: it was sufficient if the only proper implication from the terms of that other statute was that it was inconsistent with absolute and indefeasible title.

[56]     A  similar  approach  was  adopted  by  the  majority  of  the  High  Court  of

Australia in Travinto Nominees Pty Ltd v Vlattas (1973) 129 CLR 1.

[57]     Mr Bell argues that, properly construed, the Act as a whole must be taken to constitute an exception to ordinary indefeasibility principles, that outcome being reached by reference to commonly accepted techniques for determining which of two inconsistent statutory provisions must prevail.  In that respect, he argues that the LTA does not enjoy a status of inherent superiority over other statutes:   see the observations   of Gibbs J in Travinto Nominees approved by the Privy Council in British American Cattle Co v Caribe Farm Industries Ltd [1998] 1 WLR 1529.

[58]     In order to place Mr Bell’s argument in its proper context, it is necessary to examine certain aspects of the Act;  in particular its purposes, and the restrictions it imposes upon the alienation of Maori land.

Te Ture Whenua Maori Act 1993

[59]     A primary purpose of the Act is that of facilitating the retention of Maori land in the hands of Maori.  It constitutes a response to the continuing diminution of the total area of Maori freehold land, and represents something of a change in legislative

direction.  At the time of the second reading of the Bill on 17 November 1992, the Hon Doug Kidd, Minister of Maori Affairs, said in moving that the Bill be read a second time:

This long-awaited Bill is a milestone that charts a new course in Maori land legislation.  It turns away from earlier agendas of dispossession, alienation and fragmentation, which have characterised Maori land law over much of the past 120 years.   Retention of Maori land in Maori ownership is at the heart of this Bill.  However, retention has been reconciled with the need to operate in a modern context.  The Bill empowers Maori landowners with the means to decide upon and facilitate the retention, development, use, and occupation of their land.  We need only look at data that is provided by the Maori Land court to see the devastating bleaching effect that previous and current legislation has had on Maori land.

And a little later he said:

Because the main philosophy of the Bill is retention, a statutory code is laid out for the alienation of Maori land.  Under the Bill, Maori customary land cannot be alienated, and Maori freehold land cannot be alienated except as provided for in the Bill.  No alienation of Maori freehold land can occur until it is confirmed by the Maori Land Court. The court must be satisfied that the quorum requirements and decision-making processes that are set out have been complied with.

Even then, in certain circumstances the court can decline to confirm.  Those provisions may appear to be an unreasonable fetter on Maori control of Maori land.   However, they are fundamental to the philosophy of the legislation, and for that reason they remain in the Bill.

In keeping with the spirit of the Bill, which is that Maori land is to be retained in the hands of its owners, and their whanau, hapu, and descendants, the concept of a preferred class of alienees is included in the legislation. When an entire block of land is to be disposed of, it must first be offered to preferred alienees, as described in the Act, before it is offered to anyone else. However, undivided interests in land may be alienated only to persons in those classes.

That provision is one of the most significant means by which the philosophy of the Bill will be achieved.   In the matter of distribution of estates, new provisions limit succession to the direct-line descendants of the testator.  A surviving spouse is not entitled to succeed to the land itself but can acquire a life interest in the land until death or remarriage.  Whangai can succeed to interests under a will.   On intestacy the descendants or siblings of the deceased – or, if there are neither, the person nearest to the deceased in the chain of title – can succeed to beneficial freehold interests in Maori land.

[60]     The English version of the Preamble reflects that approach:

Whereas the Treaty of Waitangi established the special relationship between the Maori people and the Crown:  And whereas it is desirable that the spirit

of  the  exchange  of  kawanatanga  for  the  protection  of  rangatiratanga embodied in the Treaty of Waitangi be reaffirmed:   And whereas it is desirable to recognise that land is a taonga tuku iho of special significance to Maori people and, for that reason, to promote the retention of that land in the hands of its owners, their whanau and their hapu and to protect wahi tapu: and to facilitate the occupation, development, and utilisation of that land for the benefit of its owners, their whanau and their hapu:   And whereas it is desirable to maintain a Court and to establish mechanisms to assist the Maori people to achieve the implementation of these principles:

[61]     Section 2 of the Act sets out a clear legislative direction:

(1)       It is the intention of Parliament that the provisions of this Act shall be interpreted in a manner that best furthers the principles set out in the Preamble to this Act.

(2)Without limiting the generality of subsection (1) of this section, it is the intention of Parliament that powers, duties, and discretions conferred by this Act shall be exercised, as far as possible, in a manner that facilitates and promotes the retention, use, development, and control of Maori land as taonga tuku iho by Maori owners, their whanau, their hapu, and their descendants, and that protects wahi tapu.

(3)       In the event of any conflict in meaning between the Maori and the

English versions of the Preamble, the Maori version shall prevail.

[62]     The s 2 directions are supported by the opening words of s 17(1) which provide:

In  exercising  its  jurisdiction  and  powers  under  this  Act,  the  primary objective of the Court shall be to promote and assist in –

(a)  The retention of Maori land and General land owned by Maori in the hands of the owners; …

[63]     The aims and objectives of the new legislation were usefully discussed by the

Court of Appeal in Valuer-General v Mangatu Inc [1997] 3 NZLR 641 at 649:

The 1993 Act imposes very significant constraints on the sale of Maori freehold land, particularly sale to a purchaser who would also seek to change its status from Maori freehold land to general land.   Parliament could not have expressed the policy more clearly.  Drawing on the Treaty of Waitangi and the special significance of land to Maori people, the 1993 Act reflects as the primary objective to be applied throughout the legislation and by the Maori Land Court the retention of Maori land by Maori and the use, development  and  control  of  Maori  land  by  Maori.     The     machinery provisions allowing for alienation of land are directed and restricted to that end.  Preferred classes of alienees have priority.  Significant conditions and restrictions limit free alienability.  There is no question of majority decisions of owners necessarily carrying the day.   Any agreement of the owners is

subject to the contingency that the Maori Land Court may in the exercise of its powers and responsibilities refuse to confirm the alienation or to change the status of the land.

[64]     It is perhaps appropriate at this point to refer to the fact that the Act has undergone amendment since enactment.   Certain restrictions upon alienation have been relaxed;  the role of the Maori Land Court in confirming alienations has been somewhat restricted.   Of particular note is the fact that the Courts’ supervening discretion to grant or refuse confirmation has been confined.  But those amendments post-date the events with which this present case is concerned and do not, in my view, affect the ultimate outcome.

[65]     In broad terms, the Act prohibits the alienation of Maori land without the consent of the Maori Land Court.    Its legislative predecessor, the MAA, was less prescriptive.  Section 211 of the MAA provided that Maori might alienate or dispose of any land or any interest therein in the same manner as a European.  Once the legal interest in Maori freehold land had been transferred, it was deemed to be general land:   s 2(2)(f) of the MAA.   Section 221 provided that alienations by the Maori Trustee in his capacity as a trustee did not require the confirmation of the Court. Where confirmation was required, the Court was bound to confirm provided that certain conditions were fulfilled:  s 227.

[66]     The Act aims at controlling the alienation of Maori land by imposing  a number of qualifying procedural requirements.  It is those requirements to which I now turn.

Application of Te Ture Whenua Maori Act to this case

[67]     The requirements of this Act were not complied with in the present case in four separate respects.   Restrictions on the Maori Trustee’s powers of alienation were not observed, the requirement that the Maori Trustee give a right of first refusal to one or more of the preferred classes of alienee was not met, no valuation was obtained, and no confirmation sought from the Maori Land Court.

[68]     As to the first of these requirements, the Maori Trustee held the land with which this case is concerned under an Ahu Whenua Trust pursuant to s 354 of the Act.  Section 228 applied at all material times.  It provides:

228.  Trustees’ powers of alienation –

(1) Notwithstanding anything in the trust order, but subject to subsection (2) of this section, the trustees of a trust constituted under this Part of this Act shall have no power to sell any land vested in them for the purposes of the trust unless the proposal to sell has the consent of:

(a)At least three-quarters of the owners, where no owner has a defined share in the land; or

(b)The persons who together own at least 75 percent of the beneficial freehold interest in the land.

(2)  Subsection (1) of this section and section 147(2) of this Act shall not apply in any case where the Court is satisfied that it is necessary for the trustees   to   sell,   for   the   purpose   of   effecting   minor   boundary adjustments, part of the land vested in the trustees for the purposes of the trust.

(3)  Every alienation of any land by way of sale, transfer, or gift by the trustees of a trust constituted under this Part of this Act shall be of no force or effect unless and until it is confirmed by the Court under Part VIII of this Act.

[69]     It is common ground in this case that the Maori Trustee did not obtain the consent of at least three-quarters of the owners, although there had several years earlier been a meeting attended by a number of owners at which general authority to sell certain lots, including the present land, was given.  Argument in the present case proceeded upon the footing that the Maori Trustee sold the land to the plaintiffs without the requisite level of owner consent, with the result that the provisions of s

228(3) apply.

[70]     The second obligation was to  give  a right of first refusal to  prospective purchasers who belonged to one or more of the preferred classes of alienee, ahead of any person who did not belong to any of those classes:  s 147(2) of the Act.  The expression “preferred classes of alienees” is defined in s 4, as follows:

Preferred classes of alienees, in relation to any alienation (other than an alienation of shares in a Maori incorporation), comprise the following:

(a)       Children and remoter issue of the alienating owner:

(b)Whanaunga   of   the   alienating   owner   who   are   associated   in accordance with tikanga Maori with the land:

(c)Other beneficial owners of the land who are members of the hapu associated with the land:

(d)Trustees of persons referred to in any of paragraphs (a) to (c) of this definition:

(c)Descendants of any former owner who is or was a member of the hapu associated with the land:

[71]     Again, it is common ground that the Maori Trustee did not observe this requirement.

[72]     The third and fourth requirements arise by reason of the procedure prescribed for confirmation of alienations of Maori freehold land under Part 8 of the Act. Section 151 requires that applications for confirmation to the Maori Land Court must be made no later than three months after the date upon which the relevant instrument is executed by the Maori Trustee.  As it stood between 28 September 1993 and 14

January 1996, s 152(1) of the Act provided:

(1)      The Court shall not grant confirmation of an alienation of Maori freehold land unless it is satisfied -

(a)       That, -

(i)In the case of an instrument of alienation, the instrument has been executed and attested in the manner required by the rules of Court; or

(ii)       In  the  case  of  a  resolution  of  assembled  owners,  the resolution was duly passed with the degree of support required by this Act at a meeting held in accordance with this Act;  and

(b)That the alienation is not in breach of any trust to which the land is subject;  and

(c)      That the alienation, if completed, would not result in an undue aggregation of farmland;  and

(d)That the value of all buildings, all fixtures attached to the land, all things growing on the land, all minerals in the land, and all other assets or funds relating to the land has been properly taken into account in assessing the consideration payable; and

(e)       That, having regard to the relationship (if any) of the parties and to any other special circumstances of the case, the consideration (if any) is adequate;  and

(f)       That, in the case of –

(i)        A sale or gift of a block of Maori freehold land; or

(ii)       A lease of Maori freehold land, -

the alienating owners have, as required by section 147(2) of this Act, given a right of first refusal to prospective purchasers, donees, or lessees  who  belong  to  one  or  more  of  the  preferred  classes  of alienee, ahead of those who do not belong to any of those classes; and

(g)       That, in the case of a lease for a term of 42 years or longer, the special circumstances of the case warrant the grant of such a term.

[73]     For the purpose of making the assessment required by s 152(1)(d) and (e) there was a requirement that the Court be furnished with a special valuation prepared by the Valuer General pursuant to s 158 of the Act.  No such valuation was obtained.

[74]     Neither  was  any  application  made  to  the  Court  for  confirmation  of  the transfer.   Had the parties applied, the Maori Land Court’s discretion to grant or refuse the application was governed by ss 153 and 154 which, between 1 July 1993 and 30 June 2002, provided:

153     Court’s general discretion

(1)Subject to section 152 of this Act, on an application for confirmation made under s 151 of this Act, the Court may in its discretion, after taking into consideration the matters specified in section 154 of this Act, -

(a)       In any case, grant or refuse confirmation; or

(b)In the case of a resolution of the assembled owners, decline to determine the application and direct the recalling of the meeting of owners at which the resolution was passed.

(2)Where the Court grants confirmation, it may do so on such terms and subject to such conditions as it thinks fit.

1952”, or the like.  There is no such provision.  A clear inference is open that  the  general  rule  as  to  immediate  indefeasibility  was  to  apply. [My emphasis.]

[101]   The Judge then turned to a consideration of the policy underpinning s 233 and observed:

If I may be permitted perhaps a small and respectful quibble more as to emphasis  than  anything  else,     I  rather  think  the  sanction  depriving instruments not endorsed of force and effect reflects a promotion of administrative convenience rather than deep legal or social importance. Certainly it must be highly convenient for the purposes of Maori land administration for those involved to be able to operate on an assumption that “if we haven’t noted it we can ignore it”, but that is not vital.  There is very little land indeed now which is not under the Land Transfer Act.  It is always possible to carry out a title search.  Indeed, in some cases it could be foolish not to do so at least as a cross check upon  internal  Maori  Land  Court records.   There is no obvious social or legal imperative that alienations otherwise than by transfer be produced to the Registrar of the Maori Land Court, and I do not think s 233 should be viewed in an exaggerated light.

[102]   McGechan  J  undertook  an  extensive  analysis  of  authority both  here  and overseas in the course of which he approved passages in Breskvar v Wall citing Frazer v Walker  and  Boyd v Mayor of Wellington as authority for the principle that registration which results from a void instrument is nevertheless effective for the purposes of the LTA.   During the course of his judgment, McGechan J reminded himself of certain principles relevant to the resolution of inconsistencies between statutory enactments but (correctly, in my view) observed that such principles were not decisive in any given case.

[103]   Of course, the Housing Corporation case was different from  the  present proceeding in that the omission there consisted simply of a failure to produce a mortgage to the Registrar of the Maori Land Court for noting, confirmation by the Court not being required.  Here, as Mr Bell points out, the extent of non-compliance with the Act is significantly more serious.  He argues:

The non-compliance  strikes  at  the  heart  of  what the  Act is  intended  to achieve – the promotion of retention of Maori land in Maori ownership … The  Act itself has a serious purpose – meeting the Crown’s duty of active protection of Maori land under the principles of the Treaty of Waitangi.  A failure to uphold that purpose would provoke strong criticism.

[104]   Mr Bell is critical of the decision in the Housing Corporation case.  Among the suggested shortcomings identified by him are:

a)       the fact that Stewart v Grey County  Council  is  not  cited  and  the limited attention paid by McGechan J to what Mr Bell argues are standard techniques for resolving statutory inconsistencies;

b)       the omission of any reference to Miller v Minister of Mines;

c)       the Judge’s failure to identify the clear legislative purpose evident, Mr Bell says, from the declaration that a non-complying alienation is to be “of no effect”;  and

d)the Judge’s conclusion that, as a matter of policy, the Court ought to uphold the mortgage registered under the LTA rather than declaring it to be of no effect, as was required by the provisions of the Maori Affairs Act – in so doing, Mr Bell submits, the Judge ignored the ordinary principles of statutory construction and simply made a personal assessment of the relevant legislative policy.

[105]   The Housing Corporation decision was referred to in Registrar-General of Land  v  Marshall  [1995] 2 NZLR 189. In that case, a transmission to the administrator of an estate and a subsequent transfer from that administrator to Mr Marshall were not noted or confirmed by the Maori Land Court under the MAA. Mr Marshall was required to take action in the Maori Land Court to protect his title, and the High Court proceeding was concerned with a claim by Mr Marshall for compensation from the Registrar-General for the costs incurred by him in the Maori Land Court.

[106]   In Marshall, Hammond J reviewed the Housing Corporation decision and expressly approved both the outcome and the reasoning of McGechan J. In an obiter passage, that is nevertheless of some resonance in this case, he said (at 198-199):

Mr Oliver devoted much of his energies in the Court below, and again in this Court, to emphasising that Mr Marshall always had – from the very act of registration – an indefeasible title. The strength of such a title was, with respect, accurately summarised by McGechan J in Housing Corporation of New Zealand  v  Maori  Trustee  when  he  said  at  p  671,  line  30:    “That immediate indefeasibility was subject only to (i) fraud, (ii) other specific ss 62 and 63 weaknesses recognised by [the Land Transfer Act], (iii) the possibility of in personam rights, and (iv) the question of the Registrar’s powers pursuant to ss 80 and 81 of that Act.”  His Honour expanded on what was meant by each of those categories in light of the more modern case law, at  pp  671  and  672  of  his  judgment.    And  in  that  case,  McGechan  J specifically  held  that  on  its  registration  at  the  Land  Transfer  Office,  a Housing Corporation mortgage, by operation of the principle of immediate indefeasibility,    became    valid    and    enforceable    against    all    parties

notwithstanding the provisions of s 233 of the Maori Affairs Act.  Thus, Mr Oliver contended, all that Mr Marshall needed to have done vis-à-vis Maori Affairs,  or  for  that  matter  the  outside  world,  was  to  point  to  his  Land Transfer Act title.  Mr Marshall was entitled to say:  “Notwithstanding the lack of the Maori Land Court endorsement, I have got a perfectly good title which you, Maori Affairs, must recognise.”  In short, on this sort of question of primacy, the Land Transfer Act trumps the Maori Affairs legislation.  At the end of the day, as a matter of high principle, that must be so:  if there is any area of the law in which the absolute security is required – without any equivocation – it must be in the area of security of title to real property.  I completely agree with the premise that, with respect, lies behind much of McGechan J’s reasoning that any watering down of the primacy of indefeasibility of title through failure to carry out collateral notifications to other Registries ought to be resisted strenuously.

The Maori Land Court is an important institution in New Zealand.  It is an institution to which many Maori in fact look before turning their attention to the Land Transfer Office.   Maori rightly regard the Court as an important guardian of their interests.  But, at the end of the day, as I have said, there can be no equivocation on a matter of such importance as where paramouncy of title lies.  To say that non-compliance with other reporting requirements can or might somehow affect indefeasibility of title is simply untenable. McGechan J rejected such a proposition.  So did Judge Carter. So do I.

[107]   More recently, Ronald Young J had occasion to consider the question of indefeasibility in relation to status orders:  Edwards v Maori Land Court.  The Judge ruled that s 125 of the Act, dealing with the registration of annulled, revoked or varied orders under the LTA, must be read subject to the rights of bona fide third parties.  At para [126] of his judgment Ronald Young J said:

Expressed another way, it would clearly be contrary to the indefeasibility provisions of the Land Transfer Act that the power under s 125 be exercised without regard to third party registered rights.   And it would undermine immediate  indefeasibility.     If  such  a  proposition  was  correct,  orders registered under the Land Transfer Act by Part V of TTWMA would be an exception to the immediate indefeasibility rule.   It would mean that those who purchased land or advanced money on mortgage when at any time in the past the land had been subject to TTWMA would be susceptible to a change of status irrespective of innocently acquired third party rights.  This would, as I have observed, create clear unfairness and undermine immediate indefeasibility.   The idea of immediate indefeasibility underlies the land ownership system in New Zealand.  Subject to well defined exceptions what appears on the title can be relied upon by those dealing with the land.  If the Second Defendants are correct then another exception to indefeasibility was intended to  be created by s 125 TTWMA.  I regret (sic) this.  There would need to be a far clearer legislative mandate overriding indefeasibility before it  could  sensibly  be  said  that  the  Second  Defendants’  submissions  are correct.  Such a significant step would need unambiguous statutory direction. There is none here.  In my view, s 125 is clearly subject to the indefeasibility provisions of the Land Transfer Act.   (See Housing Corporation v Maori Trustee [1988] 2 NZLR 662).

[108]   For  present  purposes,  the  importance  of  this  passage  lies  in  the  Judge’s express adoption of the views expressed by McGechan J in the Housing Corporation case as to the need for exceptions to the indefeasibility provisions in the LTA to be clearly expressed by the legislature.   An  appeal  against  the  decision  of  Ronald Young J was subsequently allowed by the Court of Appeal in Bruce v Edwards [2003] 1 NZLR 515 but not on grounds affecting the passage set out above.

[109]   The approach of McGechan J in the Housing Corporation case has been approved in a number of other more recent cases, including Rika v Westpac Banking Corporation (1989) 1 NZ ConvC 190, 120 and The Proprietors of Hiruharama Ponui Block Incorporation v The Attorney-General HC AK M1062-SD02 13 August

2003,  Rodney  Hansen  J,  although  as  Mr  Bell  observes,  the  correctness  of  the outcome in the Housing Corporation case appears not to have been directly in issue in the latter instance.

[110]   The possible impact of the Act upon indefeasibility principles was touched upon in passing by the Maori Appellate Court in Re Pakiri R Block v Rahui Te Kuri Incorporation MAC, 1-93 23 March 1994.  As a matter of interest, Messrs Peters, Bell and Oliver, who appeared in this present proceeding, appeared also as counsel in that case.

[111]   Much of the Maori Appellate Court’s focus in Pakiri R was upon the powers of the Registrar to correct errors under s 81 of the LTA.  The Court noted the obiter comment of McGechan J in the Housing Corporation case to the effect that the Registrar’s powers under s 81 ought to be confined to the correction of slips, or minor errors on the record, a view broadly endorsed by the Court of Appeal in Nathan v Dollars & Sense Finance Ltd [2007] 2 NZLR 747.

[112]   The relevance of the Pakiri R decision to this present case lies in a brief passage in which the Court discussed the effect of s 126 of the Act:

58.      During the present hearing Judge N F Smith drew to the attention of counsel the provisions of s 126 of the Te Ture Whenua Maori Act 1993:

126      No  registration  without  prior  confirmation  –  the  District Land Registrar shall not register any instrument affecting Maori land (other than an order of the Court or of the Registrar) unless the

instrument has been confirmed by the Court, or the Registrar of the Court has issued a certificate of confirmation in respect of the instrument, in accordance with the relevant provisions of Part VIII of this Act.

He questioned whether this was not more forceful than the provisions of the

1953 Act and was there to protect the integrity of the Maori Land Court record;  that any registration by the District Land Registrar would be clearly

‘wrongful’ and that in the event of such registration he should use his powers

of correction under s 81.

59.       For the Registrar-General, Mr Oliver responded that the position of a District Land Registrar would remain the same.   The provisions of s 81 would be used on the same basis as before – to correct slips.

60.       We  do  not  believe  that  the  situation  is  perhaps  as  simple  as Mr Oliver has stated.  Various sections of Te Ture Whenua Maori Act 1993 seem to be aimed at improving the relationship between the Maori Land Court and Land Transfer Title System and at protecting the Maori Land Court record.  Section 126 is a clear example of this.  Mr Oliver advised this Court that District Land Registrars are proceeding to identify Maori land titles as such so as to prevent wrongful registration of instruments where confirmation or noting is first required.

If the title is clearly identified as Maori land and someone deals with it in disregard of the law pertaining to it, and registration takes place, wrongfully, then there may be circumstances where it would be appropriate for a District Land Registrar to use his powers of correction under s 81.

[113]   It is apparent that the Appellate Court considered that there was room for the view that s 126 was aimed at:

… improving the relationship between the Maori Land Court and the Land

Transfer Title System and protecting the Maori Land Court record.

[114]   The judgment does not suggest that s 126 operates to confer primacy to the Act over the indefeasibility provisions of the LTA.  But the final paragraph of the passage cited above suggests that a District Land Registrar may be able to use his powers of correction in s 81 where Maori land is dealt with “ … in disregard of the law pertaining to it, and registration takes place, wrongfully”.   Putting aside the relevance of s 81, it seems to me that the circumstances identified by the Maori Appellate Court would bring the case within the fraud exception to indefeasibility principles, but there is nothing in the Pakiri R judgment to suggest that the Court was of the view that s 126 operated to bring about the result for which Mr Bell contends in this case.

[115] There appears to have been only limited academic commentary on the relationship between the Act and the LTA.  The authors of Hinde McMorland and Sim Land Law New Zealand, (LexisNexis, loose-leaf volume, 2003) at 9.077 suggest that the provisions of the Act which replace s 233 of the Maori Affairs Act 1953, are so materially different that:

… it may be arguable that these new provisions have affected the views expressed by Hammond J in Registrar General of Land v Marshall, and that the relationship between the [LTA and the Act] should now be reconsidered.

[116]   But Boast & Ors Maori Land Law (2nd ed, 2004) suggest at 15.2.7 that despite what was said in Hinde McMorland & Sim, indefeasibility principles must continue  to  prevail,  and  that  in  the  absence  of  fraud,  registered  interests  must “trump” unregistered interests.

[117]   Mr Bell exhorts the Court to give effect to the purpose of the Act by finding that the plaintiffs do not enjoy the benefits of indefeasibility under the LTA.  But it is important to recognise the countervailing argument and the practical consequences which would flow from a decision adverse to the plaintiffs.   In the first place, of course, the plaintiffs would be deprived of the property of which they have been the registered proprietors for more than 10 years, and for which they have paid an agreed consideration to the Maori Trustee, acting for the former beneficial owners.

[118]   But,  perhaps  even  more  importantly,  it  is  necessary  to  consider  the implications for the integrity of the system of title by registration encapsulated in the LTA.  If the plaintiffs have no guaranteed title then neither would any succeeding bona fide purchaser for value obtain good title – no successor in title would enjoy any greater security of title than the original purchaser.  It must follow therefore that no successor in title will be able to maintain, as  against the original beneficial owners and their successors, any right to land acquired in good faith and for value, perhaps decades after the original void dealing.   In that respect, successors in title would be worse off than those taking bona fide for value without notice of an earlier fraud. Mr Oliver characterises such a situation as “horrendous” and as constituting a new and potentially far-reaching exception to indefeasibility principles.   Mr Bell accepts these necessary consequences, but argues that the purposes underpinning the Act are of even greater importance, both constitutionally and socially.

[119]   It is common ground that purchasers of Maori land will not always know the status of the land being purchased;  titles do not always carry a status notification. Sometimes, as in this case, there may be indicators that land is possibly Maori land - for example, there is here the identity of the vendor and the Maori name of the block of land of which the purchased portion originally formed part, but that will not always be the case.

[120]   Mr Bell argues in his synopsis of argument that counsel for other parties overstate the practical risk of any significant harm to successors in title.  He says:

129.Current conveyancing practice deals with the matter.   The Maori Land Court has put its records on line.   See copies of the online searches for the land in this case in the bundle of authorities.  Those documents show that there is a disclaimer.  In cases where there is a question whether a property is Maori land, Webb Ross obtains a letter from the Maori Land court confirming the status of the land. Such letters do not carry the disclaimer, can be relied on and are kept on file to comply with s 164C of the Land Transfer Act.

130.The first defendant has carried out a “data-matching” exercise to identify land that is or could be Maori freehold land.  See Pakiri R paragraphs 60, 61 and Torrenstalk December 2002 1.3, as to rulings by the first defendant and Torrenstalk October 2003- “Maori Land Titles”.   He has done this to carry out his duty under s126 of Te Ture Whenua Maori Act.  Maori freehold land is not identified as such on the titles, but it is flagged so that LINZ staff can check for compliance with Te Ture Whenua Maori Act under s 126.   It is understood that while it cannot be guaranteed that every piece of Maori freehold land has been flagged, there is a high degree of assurance that most Maori freehold land has been flagged.

131.Transfers of land under the Land Transfer Act are now made by electronic lodgement.   See s 164A-E and the Land Transfer Regulations 2002.  For certification under s 164A the first defendant has specified that statutory provisions relating to Maori freehold land must be certified as complied with or not applying.   See S174A(3)(c) and Reg 12 of the Land Transfer Regulations 2002.

132.This legislation places an important responsibility on conveyancers to certify accurately and truthfully as to compliance with Te Ture Whenua Maori Act, to holding evidence of compliance and retaining it for 10 years.

133.In practice, at the time of pre-validating an edealing, a property flagged as Maori freehold land will generate a warning.  At the time of signing the edealing, the conveyancer will be required to certify as to compliance.  The system makes the conveyancer turn his mind to compliance with Te Ture Whenua Maori Act.  If the conveyancer has established from inquiries with the Maori Land Court that the

land is not in fact Maori freehold land, he can hold on his file a letter from the Court to that effect to show that Te Ture Whenua Maori Act does not apply.   Otherwise he will hold documents proving compliance.

134.In that context there is little reason to insist on indefeasibility if a dealing is registered when it does not comply with Te Ture Whenua Maori Act.   The status of the land is the primary consideration. There are systems in place to check the status of land, although it is not recorded on title.  Those systems also make conveyancers ensure that the Te Ture Whenua Maori Act is complied with where Maori freehold  land  is  involved.     If  a  conveyancer  should  certify incorrectly, his client should not be able to benefit from his mistake. Not allowing indefeasibility to apply in those cases will focus practitioners’ minds on the importance of complying with Te Ture Whenua Maori Act.

[121]   Mr Oliver does not accept that most Maori freehold land has been flagged as to status in the records of the first defendant.  His instructions are that the flagging exercise is in its early stages and that it will be many years yet before there can be any significant degree of assurance about the identification in the first defendant’s records of Maori land.

[122]   As his written submissions indicate, Mr Bell’s argument at a practical level is that conveyancing solicitors must on every occasion make the necessary inquiries of the Maori Land Court;   solicitors who fail to do so and who have given incorrect certificates will face claims from their clients.

[123]   Despite Mr Bell’s careful argument, I am uneasy about accepting his claim that conveyancing solicitors may confidently rely upon the records of the Maori Land Court.   Counsel for other parties do not agree that the records of the Maori Land Court are in such order as to justify complete reliance upon them.   The probability is that there is continuing substance in the observations of Richard P Boast:  ‘The Implications of Indefeasibility for Maori land’ in David Grinlinton (ed) Torrens in the Twenty-first Century (LexisNexis, Wellington, 2003) 101,102:

In reality there are two systems of title recording in New Zealand, one official (the Land Transfer system) and one quasi-official (the Maori land system).    The  Land  Transfer  Act  system is  regarded, justifiably  on  the whole, as a model of streamlined efficiency.   The Maori Land system is unofficial, difficult to use, cumbersome, and overwhelmed by the practical difficulties of monitoring and recording the continuous proliferation of multiple interests.

[124]   Mr Bell raises a further practical point:  Maori land does not change its status simply by virtue of a transfer to a non-Maori purchaser. It retains its status as Maori land unless and until that status is changed by the Court. Accordingly, restrictions on alienation remain.  A non-Maori purchaser (or a successor in title of that purchaser) will be subject to the same restrictions on alienability as Maori owners.   Mr Bell characterises that as an “incongruous situation”.

[125]   There is a degree of substance in much of what Mr Bell says but, in the end, I have not been persuaded that the factors that particularly appealed to McGechan J in the Housing Corporation case ought not to carry determinative weight in this case, despite  the  significantly  more  protective  regime  established  by  the  Act  in comparison with earlier days.  Security of title by registration lies at the very heart of this country’s system of land ownership.  The legislature must be taken to have been well aware of that, as is noted by McGechan J at p 673 of the Housing Corporation case. Those responsible for drafting the Act must be taken to have known of the Judge’s comments in that case and have been aware of the need, if the intention was to override the LTA, to say so expressly.  Had Parliament intended to impinge upon indefeasibility entitlements, then that could have been simply achieved, either by a specific section in the Act, or by an appropriate amendment to s 63 of the LTA. Instead, Parliament enacted s 126 of the Act which, although directing that the first defendant must not register an instrument which has not been confirmed by the Court, stops short of taking the next step of declaring that any such registration would itself be of no effect.   I do not accept that the availability of possible compensation claims would constitute an appropriate remedy to dispossessed registered proprietors who have acquired land in good faith and for value, possibly decades after the original alienation.

[126]   I do not overlook Mr Bell’s comprehensive and determined arguments to the contrary, and in particular I do not overlook the possibility that, in an appropriate case,  indefeasibility  may  be  lost  by  statutory  implication  (Miller  v  Minister  of Mines).  But where, without fraud, a purchaser of Maori land becomes registered as proprietor without complying with the  requirements of the Act,  I am unable to conclude that the legislature intended that no indefeasible title would accrue to the

purchaser, nor to any successor in title.  In reaching that conclusion, I have taken into account both the Preamble to the Act, and the provisions of ss 2 and 17(1).

[127]   I accept Mr Bell’s submission that the LTA is not legislation of a special character  which  enjoys  inherent  priority  over  other  enactments.    But,  as  was observed by Lord Browne-Wilkinson in British American Cattle Co v Caribe Farm Industries Ltd [1991] 1 WLR 1529 at 1533:

… it is critical to keep to a minimum the number of matters which may defeat the title of the registered proprietor.

in order that the integrity of the system of land registration is maintained.  That must be so although the LTA may be over-ridden by implication, that implication must be plain from the terms of the over-riding statute:   see the discussion in Horvath v Commonwealth Bank of Australia [1999] 1 VR 643 at 655.

[128]   In determining whether ss 62 and 63 of the LTA have been overridden by implication, I am entitled to have regard, not only to the legislative purposes which underpin the Act, but also to the need to preserve, so far as is possible, the integrity of the Torrens System.

[129]   I am satisfied that in enacting the Act, Parliament did not intend to override the security of title which ss 62 and 63 of the LTA confers.

Another perspective

[130]   I have reached my conclusion by applying conventional analytical principles to the interpretation of the LTA and the Act.  In doing so, I have been mindful of the practical consequences for Maori owners of according primacy to ss 62 and 63 of the LTA.  There is no evidence in this particular case that any Maori beneficiary feels disenfranchised by what has occurred.  And the Maori Trustee had broad authority from the majority of the beneficiaries to undertake the sale of land of which the present section formed part.  It is noteworthy also that Mr Bell’s instructions come not  from  any  former  beneficiary  but  from  Mr  George,  who  participated  in

proceedings before the Maori Land Court and the Maori Appellate Court, and is a member of a preferred class of alienee although not a beneficiary.

[131]   But it may well be that in other cases Maori owners are deprived of land through the operation of the LTA.  For many, compensation, if available, will simply not make good the loss;  land is regarded as a taonga and not to be surrendered.

[132]   Mr Bell referred in argument to the somewhat notorious decision of this Court in Beale v Tahema Te Hau (1905) 24 NZLR 883 and asked the Court to avoid the injustices of “colonial days”. This case is nothing like that one. But there is a compelling case for further legislative reform, recognised in a Law Commission Issues Paper “Review of the Land Transfer Act 1952”, which came to hand when this judgment was in final draft.  As is said at chapter 10.56 of the Paper:

To summarise, the LTA title and the record held by the Maori Land Court perform distinct functions.   To allow each record of title to be used effectively, the two records need to be aligned and discrepancies between the two eliminated.

[133]   There is obvious merit in the early identification of solutions to the problems illustrated by the facts of this case.

Declaration

[134]   The grant of a declaration under the Declaratory Judgments Act 1908 is discretionary in character.    It is, however, not suggested by any counsel that a declaration ought to be refused on discretionary grounds.

[135]   In the light of the conclusion which I have reached, it is appropriate to grant the first declaration sought by the plaintiffs.  There will accordingly be a declaration that the plaintiffs, as transferees named in a transfer registered under the LTA in respect of Certificate of Title NA73D/366, have the benefit of indefeasible title.

Status order

[136]   In its decision of 11 November 2002, the Maori Land Court adjourned the plaintiffs’ application for re-hearing of their initial application (dismissed on 18 June

2002) for an order declaring the land with which this proceeding is concerned to be general  land.    The  adjournment  was  granted  pending  the  Maori  Land  Court’s decision on the application made under s 18(1)(a).  The Court is told that, following the s 18(1)(a) decision, the Maori Land Court endeavoured to ascertain the plaintiffs’ intention with respect to the outstanding application for a re-hearing, but that the matter has never been advanced. Technically, therefore, it appears that the re-hearing application remains on foot.

[137]   Section 130 of the Act provides that no land shall lose the status of Maori freehold land otherwise than in accordance with the Act or as expressly provided in any other Act.  Section 131 provides:

Court may determine status of land

(1) The Maori Land Court shall have jurisdiction to determine and declare, by a status order, the particular status of any parcel of land, whether or not that matter may involve a question of law.

(2) Without limiting the classes of person who may apply to the Court for the exercise  of  its  jurisdiction,  the  District  Land  Registrar  for  the  Land District in which any land is situated may apply to the Court for the exercise of its jurisdiction under this section in respect of that land.

(3) Nothing  in  subsection  (1)  of  this  section  shall  limit  or  affect  the jurisdiction of the High Court to determine any question relating to the particular status of any land.

[138] Section 131(1) confers upon the Maori Land Court the power to make declarations as to the status of land for the purposes of the Act.   That jurisdiction must be exercised in the light of ss 136 and 137 which respectively provide:

Power to change status of Maori land owned by not more than 10 persons

The Maori Land Court may make a status order under section 135 of this Act where it is satisfied that—

(a)  The land is beneficially owned by not more than 10 persons as tenants in common; and

(b) Neither the land nor any interest is subject to any trust (other than a trust imposed by section 250(4) of this Act); and

(c)  The title to the land is registered under the Land Transfer Act

1952 or is capable of being so registered; and

(d) The land can be managed or utilised more effectively as General land; and

(e)  The  owners  have  had  adequate  opportunity  to  consider  the proposed  change  of  status  and  a  sufficient  proportion  of  the owners agree to it.

Power to change status of Maori land

(1)   The Maori Land Court may make a status order under section 135(1) of this Act where it is satisfied that—

(a) The legal estate in fee simple in the land is vested in a Maori incorporation or the trustees of a trust constituted under Part 12 of this Act; and

(b) The title to the land is registered under the Land Transfer Act 1952 or is capable of being so registered; and

(c)  The alienation of the land is clearly desirable for the purpose of a rationalisation of the land base or of any commercial operation of the Maori incorporation in which or the trustees in whom the legal estate in fee simple in the land is vested; and

(d) The rationalisation referred to in paragraph (c) of this subsection will involve the acquisition of other land by the Maori incorporation in which or the trustees in whom the legal estate in fee simple in the land is vested; and

(e)The quorum and voting requirements imposed by regulations made under this Act in relation to the resolution necessary to authorise the alienation referred to in paragraph (c) of this subsection are impractical.

(2)       Where the Maori Land Court makes, in accordance with subsection (1) of this section, a status order under section 135(1) of this Act, the status order may be made conditional on the net proceeds of the alienation of the land—

(a)  Being applied towards—

(i)    The purchase of a specified piece of land; or

(ii)   The improvement of any specified piece of land owned or to be  purchased by the Maori incorporation or the trustees; or

(iii)  Both; or

(b) Being held in trust for the purposes of the acquisition of other land pursuant to a land acquisition plan approved by the Court or for the

purposes of the improvement of land pursuant to a land improvement plan approved by the Court; or

(c)   Both.

[139]   Mr  Peters  argues  that  this  Court  has  a  parallel  jurisdiction  pursuant  to s 131(3).  I am by no means certain that this Court’s jurisdiction in respect of status orders is as wide as that.   Assuming, however, that jurisdiction exists, this Court would be bound to take into account the various considerations set out in ss 136 and

137.  There is no evidence before the Court as to those matters.  Quite apart from that, however, the question of status is quintessentially a matter for the Maori Land Court and the Maori Appellate Court.  It appears that the plaintiffs’ application for a re-hearing before the Maori Land Court remains on foot.   Even if the re-hearing application is taken by the Maori Land Court to have lapsed, it seems to me that, given the outcome of the present proceeding, there are grounds upon which it would be appropriate for the plaintiffs to make a fresh application to the Maori Land Court for a change of status.

[140]   For the foregoing reasons, I am not prepared to grant the second declaration sought by the plaintiffs, namely a declaration that the status order registered against the title should be discharged.

Costs

[141]   The question of costs is formally reserved. However, given the outcome of the proceeding and the interests of the various parties, my tentative view is that costs ought  to  lie  where  they  fall.    If  any  counsel  takes  a  different  view  then  a memorandum to that effect may be filed and served within 21 days of the date of delivery of this judgment.

[142]   Mr Bell’s costs are payable from funds set aside under s 99 of the Judicature Act 1908.   In the case of any difficulty in that respect, whether administrative or otherwise, the file may be referred to me.

Leave reserved

[143]   I reserve leave to apply generally.

C J Allan J