Legal Advice on Transfer Fraud, Caveatable Interest, Easements, and Covenants in Land

QUESTION ONE
1. Advice to Patricia
a) Whether she is guilty of transfer fraud
Section 5 Land Transfer Act 2017 provides that fraud should be construed as espoused under
section 6. Section 6 (1) defines fraud to include forgery or other dishonest conduct by registered
owner. Section 6 (2) (b) (i) is very instructive and makes it mandatory that a registered owner
must have had actual knowledge or wilfully blinded him/herself to existence of unregistered
right. Patricia’s acts does not fall within the above definition hence not guilty of transfer fraud.
b) If she knew after entering the agreement but before registration.
She would still not be guilty of transfer fraud as section 6 of Land Transfer Act 2017 concerns
the state of affairs when obtaining registration and not when agreement is entered. In any event,
at this stage she does not have an opportunity to comply with the due diligence requirements as
demanded under the principle of caveat emptor.1
c) If she becomes aware after registration.
In this case she would be guilty of transfer fraud as the critical aspects of fraud as defined under
section 6 (2) (b) (i) of Land Transfer Act 2017 would have been met in its entirety.
d) If Patricia did not consult Laura.
In this case she would be guilty of transfer fraud. This is because under section 6 (2) (b) (i) of
Land Transfer Act 2017 she would be having constructive knowledge. Moreover, under Section
6 (4) constructive fraud has a place in the face of the law. Fraud as heralded under the Act is
pegged on information she ought to have known.2
2. Advice to Owen (Avenues to overturn registration and possible outcome)
Whereas a title to land is indefeasible under Torrens system,3 it has exceptions. Accordingly, his
redress lies with the application to court for an order for alteration of the register;4 or an order
1 Paul Calder and Duncan Cotterill, ‘Commercial real estate in New Zealand: overview’,
Thompson Reuters 2019. Accessed from https://uk.practicallaw.thomsonreuters.com/0-636-
6408?transitionType=Default&contextData=(sc.Default)&firstPage=true&bhcp=1
2 Assets Co Ltd v Mere Roihi [1905] AC 176, at 210
3 Frazer v Walker [1967] NZLR 1069 (PC).
4 Land Transfer Act 2017, sec 54.

cancelling registration.5 The court has jurisdiction to look at the facts and determine whether
impugned registration is manifestly unjust under Section 55 (2) of Land Transfer Act 2017. The
likely outcome that the order for cancellation will not be granted as registration in this case is not
manifestly unjust.
3. Whether Owen’s knowledge changes the position
It does not change the position as the application will still be within statutory timelines. Under
section 54 (3) of Land Transfer Act 2017, application under sections 54 and 55 must be instituted
within 6 months. In this case she would be within the scope of 6 months.
4. Legal position if Owen has been in occupation for 3 years.
Under section 55 (4) (f) time of occupation by the applicant for cancellation of registration is
critical and informs the decision of the court. Three years is a very short time and it may not
persuade the court to rule in favor of the applicant.
a. Period for occupation is in doubt
This in light of Section 55 (4) (f) casts doubt on the period of stay and may lead to a finding
against Owen.
b. Failure to remember where the ashes were scattered.
Section 55 (4) (i) of the Act, the High court has discretion to consider the significance of the
land. This therefore excludes application of this critical aspect which may lead to adverse finding
even though it is not definitive.
c. If the shed contained additional implements
This buttresses likelihood of favorable finding as under section 55 (4) (g) improvements in the
land matter.
5. If Patricia fails to grant access.
Right to access or way is guaranteed under subpart 4 of the Act in form of easements. Patricia
only needs to apply to the registrar under section 108 via easement instruments for easement.
This will grant him right of access.
5 Land Transfer Act 2017, sec 55.

QUESTION TWO
Part A
i. Dora’s interest