week thirteen Flashcards
what are the two proceedings to do with caveats
- interlocutory hearing to determine whether caveat should remain/be removed (where RO wants removed) - decided by a judge alone based on filed affidavit forms of evidence (quick, urgent)
- substantive hearing over the reason why the caveat was lodged - a slow court process with evidence given by witnesses to do a full hearing of the issue
for a caveat to be lodged, a __________ must be shown
legal or beneficial interest in land
what are some examples of interests that do not support a caveat
- potential interest in land (e.g. making inquiries of the real estate agent at an open home)
- mere contractual or personal rights (between you and the owner)
- licence to occupy (your footpath to the roadside gives them licence to come onto the property, but this licence can be revoked by telling them to get off and you only give it to allow them to come on e.g. tradies, sales people)
- right of first refusal (in contract)
what is the difference between a legal and a beneficial interest?
legal = registered on the title
beneficial/equitable = where you claim you have an interest but it isn’t registered
what interests may support a caveat
- an agreement for sale and purchase
- an agreement to mortgage or an unregistered mortgage
- an alleged trust (cestui que trust)
- an unregistered lease
- an unregistered easement
what is an easement
a right, of some sort, over another persons land
how can you get an unconditional agreement for sale and purchase
- if there are no further terms (just the general agreement) and both parties sign the agreement
- where all conditions become fulfilled within the time limit
does an unconditional agreement for sale and purchase support a caveat + what case
Foreman v Hazard - the purchaser’s interest will support a caveat.
vendor holds the property on trust for the purchaser from the unconditional agreement till it is transferred and there is an equitable interest because there is nothing more they can do to own the property except the formality of the transfer
can conditional agreements for sale and purchaser provide a purchaser with a caveatable interest + what case?
it used to be that if there was a conditional agreement for sale and purchase, the court could not order specific performance of a contract that still had conditions needing to be fulfilled.
the current law is that it can support - Bevin v Smith, although in this case the condition to be fulfilled was only a mere formality and it is unclear what would happen if it is not a mere formality as we don’t have law on that
what is specific performance
where a contract has been formed, for some reason there’s a problem with it but the court orders it go ahead as is
what are the facts of Bevin v Smith
Bevin and Smiths both required to help obtain the consent of the Tribunal for the Smith’s to own lots of land at one point.
Bevin changed his mind and didn’t do anything or instruct this solicitor to do anything to help that.
the date for condition to be fulfilled passed and the contract become void.
did the Smith’s have a caveatable interest in Bevin v Smith
yes - in equity and to impose fiduciary obligations on the vendor continuing in possession
whether an equitable interest has passed to the purchaser depends on (based on Bevin v Smith CA decision)
- the terms of the contract itself (the actual condition that the contract is subject to)
and
- intention - e.g. did you intend to for it be binding when entered or when the conditions were fulfilled
when do contracts usually become binding and what is the unusual situation where it wouldn’t be
when entered into - unusual situation may be found where they have to wait for the condition to be fulfilled to be bound because of intention
what was the result of Bevin v Smith
- bevin ordered to perform all his obligations under the ASAP
- transfer of property to Smiths
what cases confirm the position taken in Bevin v Smith of a conditional ASAP being enough to support a caveat
McDonald v Isaac Construction
Bruce v Edwards
- equitable interest acquired as soon as ASAP formed
generally, dispositions of land require __ _____ ___ _____ under which act?
a document in writing under s24-27 PLA 2007
what happened in Windy Day Ltd v Whitehead
Mr Brody (director of Windy Day) owed Mr Whitehead money, who ordered a charging order over Mr Brody’s mothers house.
Windy Day was going to turn some land into apartments so Brody said he would sell Whitehead one at a discounted price to offset the debt.
There was some correspondence and emails between the parties’ solicitors and Mr Whitehead, after not hearing anything for a long time and seeing the apartments advertised for sale, lodged a caveat again Windy Days’ title.
Held: Mr Whitehead delayed selling Brody’s mothers house on the basis of the agreement and despite no formal documentation there was enough between the parties to determine what they agreed to be the basis of an agreement and the essential terms needed to effect the transfer of the property
if there was a true oral contract ASAP (absolutely nothing written, unlike in Windy Days) would there be a caveatable interest
unclear, but likely not since PLA 2007 requires transfer in writing
what is a trust
where one person holds property/money/something on behalf of another person (to look after)
what is an implied trust
an implied trust can arise where the parties have a common intention as to property without having used express words to communicate that intention to one another
what are the two types of implied trust
resulting trust and constructive trust
what is a resulting trust (type of implied)
a trust that arises where the beneficial interest in property is not applicable to an indicated beneficiary and therefore results/reverts to the disposer
what is a constructive trust (type of implied)
a trust that arises where property is held by a person in circumstances where it would be inequitable to allow them to assert full beneficial ownership of the property
what is a cestui que trust
if land is held by A in trust for the benefit of B
A is the trustee (the person who holds the legal estate on behalf of B)
B is the beneficiary (the person who is to benefit from the estate)
does the beneficiary of a trust have a caveatable interest
yes
does the beneficiary of a discretionary trust have a caveatable interest
no
does the beneficiary of a will - in land prior to the administration of the estate have a caveatable interest
yes
does the beneficiary of a will - a share in residue prior to administration of estate have a caveatable interest
no
what is a discretionary trust
whereby the trustees can decide whether they give you money - there is no caveatable interest because you might never get it
why is a share in residue prior to administration of estate not caveatable
it is too uncertain
what happened in Willigers v McFarlane
Willigers owned the property but transferred to McFarlane who was to hold the property on trust for it. the point of the trust was to sell property and make a profit.
Willigers lodged a caveat over the property because there was issues with repaying the mortgage and the bank issued notices of intention to sell it.
Willigers claimed an interest as beneficiary pursuant to a deed of trust.
he didn’t have a caveatable interest because the purpose of the trust was for profit and wasn’t about the property and land itself. his only claim was to the money he would receive over and above the $500,000
what happened in Zhong v Wang
Zhong had to meet criteria as an investor - $1M held in NZ for two years - prior to a grant of residence for him and his family to move here.
Wand invested the money for him in some property and then wasn’t going to return it.
It was held that Wang was Zhong’s agent for the purpose of applying that money and since he had invested that money in property, there was a reasonably arguable case to support a trust and a caveat
what happened in Herbert Equities Ltd v Mamfredos
Herbert wanted to borrow $100M USD and Mamfredos agreed to act as broker. Herbert paid him a $60,000 brokerage fee which wasn’t repaid when the loan didn’t go ahead.
Herbert alleged Mamfredos had used the funds to purchase property which they can put a caveat over.
Herbert had a caveatable interest on the basis of fiduciary obligations owed by Mr M to Herbert.
what happened in TE Group v Lin
TE Group, in financial stress, were selling properties, one to Mr Lin.
They trusted Mr Lin to pay the $1.6M he was short and went ahead and registered Mr Lin on the title.
TE Group argued Mr Lin had not paid the $1.6M so caveated the property but Mr Lin said it was paid by his sister in China.
TE Group then alleged documents on which it had relied from Mr Lin had been fraudulently prepared to take advantage of the difficult position TE Group were in.
Mr Lin argued that he hadn’t and even if there was a proper foundation for challenging the title to the land, at best all the TE Group had was an action for debt.
There was enough of an arguable case on the documents the court had before it for there to be a caveatable interest on the basis of fraud (rather than the money owed).
The factual problems will be sorted at the substantive hearing.
under S140 of the LTA 2017, a registrar cannot make any entry on the register which has the effect of ?
charging, transferring or prejudicially affecting things
can you have a caveatable interest on a conditional agreement for sale and purchase? give authority
yes, Bevin v Smith
finance is for the benefit of which party?
the purchaser
in nz, it is generally taken that the parties to an agreement for sale and purchase are bound when?
at the time they enter into the contract, unless terms of the contract and intention of the parties proved
which section of the LTA 2017 lists three requirements for whether a mortgagee can jump a caveat lodged on the record of title when exercising its mortgagee power of sale?
S141 - if the three requirements are met, it can be jumped over
