Priority conflicts case law

Question 1

The rule in Hunt v Luck

Answer 1

The principle of notice. When you buy land or an interest in land, it is your job as a prospective purchaser to go and inspect the land. You are therefore automatically on actual, imputed, or constructive notice. Will only not be in notice if the actual occupant lies about thier interest. (Only applies when dealing with a prior equitable claim in conflict with a later legal estate.)

Question 2

The principle of notice. When you buy land or an interest in land, it is your job as a prospective purchaser to go and inspect the land. You are therefore automatically on actual, imputed, or constructive notice. Will only not be in notice if the actual occupant lies about thier interest. (Only applies when dealing with a prior equitable claim in conflict with a later legal estate.)

Answer 2

The rule in Hunt v Luck

Question 3

Notice arising from documents. The original vendor had lied about a mortgage acquired by deposit of deeds. A reasonable purchaser would not have accepted that as an excuse, and equiry was not reasonable. Therefore, the new legal interest loses to the equitable interest, as the new owner is not equity’s darling as they were on constructive notice of the fault in the deeds.

Answer 3

Agra Bank v Barry

Question 4

Agra Bank v Barry

Answer 4

Notice arising from documents. The original vendor had lied about a mortgage acquired by deposit of deeds. A reasonable purchaser would not have accepted that as an excuse, and equiry was not reasonable. Therefore, the new legal interest loses to the equitable interest, as the new owner is not equity’s darling as they were on constructive notice of the fault in the deeds.

Question 5

Equity’s darling

Answer 5

A bona fide purchaser for value without notice.

Question 6

Tourville v Naish

Answer 6

Shows the importance of the timing of the notice.

– Here the purchaser had no notice of the equitable interest when he gave his bond to pay for the estate, but before he paid the residue, the interest came to his knowledge. The Lord Chancellor affirmed that it is the moment of actual payment that matters and so the knowledge is an incumbrance which allows the purchaser to refrain form fulfilling his bond of payment.

Question 7

AIB v Glynn

Answer 7

If A has a mere equity against B and B sells to C, the priority conflict will be determined depending on what C knew at the time. C takes the estate free of A’s mere equity unless they had knowledge of it or the circumstances which gave rise to it.

Question 8

Actual notice exception to the conflict between unregistered (but registrable) vs registered

Answer 8

If the later purchaser who registers has knowledge of the earlier unregistered interest, they are committing fraud (Forbes v Denniston).

Imputed notice through one’s solicitor having knowledge of the unregistered interest achieves the same outcome (Le Neve v Le Neve).

In Re Fuller, the High Court held that knowledge of facts from which an interest could be inferred did not put the purchaser on actual notice. This was a more individualistic approach to land law form the court.

Question 9

Forbes v Denniston

Answer 9

Actual notice exception: If the later purchaser who registers has knowledge of the earlier unregistered interest, they are committing fraud

Question 10

Le Neve v Le Neve

Answer 10

Actual notice exception: Imputed notice through one’s solicitor having knowledge of the unregistered interest is also fraud.

Question 11

Re Fuller

Answer 11

Actual notice exception: The High Court held that knowledge of facts from which an interest could be inferred did not put the purchaser on actual notice. This was a more individualistic approach to land law form the court.

Question 12

Volunteers exception to the registered vs unregistered priority conflict

Answer 12

If there is no consideration given, the volunteer is bound by an earlier unregistered document.

Question 13

Bank of Ireland v Rockfield

Answer 13

Constructive notice does not apply to purely commercial transactions (where no land is transacted).

Question 14

Northern Bank v Henry

Answer 14

Henchy J expressed the view that the test for notice is not a self-interested person–it is a very high standard which must be reached for the purchaser to be held not to have been on notice.

THUS: Standard here is higher than that of tort (references Atkin J in particular). Property law more about the common good than tort is. The clairvoyant person, not the reasonable person, is often the standard.

Question 15

S.72(1)(j)

Answer 15

The equivalent of the rule in Hunt v Luck for registered land. The standard for notice is higher again.

Question 16

Doherty v Doherty

Answer 16

The appellant argued that becase Mrs. Doherty’s interest (an equitable interest which arose from partly financing the family home, which was registered in her husband’s name only) was a s.72 burden, existing at the time of the mortgage, it was not affected by the mortgage, with the result that it was Mr. Doherty’s interest only which was charged.

Held: The enquiry made into Mrs Doherty’s interest in the family home, whihc involved an examination of title, was not sufficient: the mortgagor was on notice as to her s. 72 rights. Nonetheless, she was estopped from enforcing those rights.