Reconciling Equitable Claims with Torrens Title

Abstract

Under the Torrens system of land registration, the act of registration confers what is commonly regarded as immediate ‘indefeasibility’ of title, meaning the relevant estate or interest is held free from unregistered estates or interests. Nevertheless, the courts have always permitted so-called ‘in personam claims’ against registered proprietors based on legal or equitable obligations, and which may result in the title being defeated. Although it has been more than 130 years since the first Torrens statute was enacted, the relationship between the statutory protection and equitable claims arising out of receipt of property by third parties remains an uneasy one. This has been an enduring source of uncertainty for those using or administering the Torrens system. This article argues in favour of a more systematic approach to delineation of the legitimate scope of ‘receipt-based’ equitable claims. The key question is whether the claim involves the assertion of an interest or estate incompatible with the protection conferred by the wording of the Torrens statutes.