Reference no: EM132474873 , Length: 1200 Words
ASSIGNMENT -
This question occurs in 2015. Maxwell was the registered proprietor of land under the Real Property Act in NSW. He borrowed money from Charlie to invest in a dairy farm in Lismore. Maxwell completed a memorandum of mortgage (which he gave to Charlie) but he had mislaid his certificate of title. Maxwell told Charlie that he would find it as soon as possible and give it to Charlie. Charlie felt Maxwell was trustworthy so he did not bother to lodge a caveat.
Maxwell also sought to borrow money from Pauline. Maxwell did not mention the mortgage agreement with Charlie. Pauline agreed to lend the requested sum. Given that the certificate of title was missing, Pauline was happy to evidence their agreement in a deed. She advanced the money and then lodged a caveat over the property, using the deed as evidence of her interest.
Two days later, the certificate of title was found by Maxwell's son, Christopher. Christopher had a gambling problem and decided that he would use the certificate to raise some much needed funds. He tricked his father into signing a blank transfer. He then sold the land to his bookie, Louise. Louise made no search of the register. Louise received the certificate of title and a transfer dealing signed by Maxwell.
Louise was also in need of quick cash and before she registered her ownership she onsold the property to Joshua. At settlement, Joshua received the certificate of title, the transfer from Maxwell to Louise, and the transfer from Louise. When the documents were presented to the Land and Property Information they could not be lodged because of Pauline's caveat.
(a) What is Joshua's legal position with regards to the title in the land and Maxwell's ownership? If he succeeds in becoming registered will he be subject to the mortgages?
(b) Assuming Joshua is unsuccessful, which mortgage will have to be satisfied first if Maxwell goes bankrupt?
FORMATING INSTRUCTIONS: The assignment must not exceed 4 A4 pages of 1.5-spaced, 12 point font, Times New Roman.