Indefeasibility Flashcards
4 types of claims that may be brought to defeat the registered proprietor’s title
- Claims that are not based on a prior property right (e.g. Contract, tort, equity)
- Claims that are not based on a prior property right and fall within the wording of s 46(2)
- Claims based on a prior property right (e.g equitable mortgage, registered mortgage, tenancy)
- Claims based on a prior property right, but which fall within the exceptions under s 46(2)
Barry Crown’s view and Bebe: Only 2 and 4 are enforceable
Kevin Low’s view: 1, 2, and 4 should be enforceable
A registered proprietor seeks to evict a tenant on his land. What is the tenant’s claim based on?
It’s based on a property right (his tenancy).
A registered proprietor contracts to sell his land to a purchaser. The proprietor later refuses to sell. What is the purchaser’s claim based on?
It’s based on contract.
It’s not based on a prior property right.
Analysis: Does (claimant) have an overriding interest?
- s 46(c)
- s 46(d)
- Claimant’s tenancy will be an overriding interest under s 46(h) as it does not exceed 7 years.
In Bebe, the court also held that any overriding interest that served to defeat the title must exist either before or at the time the contract was formed, or before and at the time the instrument was registered. On the facts, …
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title by reason that it was procured by mistake?
(FIRST, whether mistake can be brought to defeat title)
(In personam claim)
First, (claimant) may want to enforce the action to set aside the mortgage / tenancy / sale for mistake as an in personam claim. While the SGCA in Bebe has suggested that that ‘courts should be slow’ to allow in personam claims that do not already fall within the exceptions under s 46(2), and the SGHC in Malayan Banking has applied Bebe’s dicta to exclude an undue influence as an in personam claim, (claimant) could try and argue for a more expansive approach to in personam claims as espoused by academic Kevin Low. According to academic Kevin Low, all personam claims should be enforceable as long as they are not based on a prior property right, since the indefeasibility principle provides immunity only to prior property rights, and not to all claims. On this basis, a misrep/undue influence claim should be enforceable as an in personam claim against (mortgagee / tenant / purchaser) since it is not based on a prior property right.
(Vitiating factor under s 46(2)(b) LTA)
Second, even if we keep to Bebe’s restrictive approach to in personam claims, (claimant) may want to argue that the mistake should nevertheless fall under s 46(2)(b) LTA to vitiate the mortgage contract / tenancy agreement / sale agreement. In Bebe, Chan CJ suggested that the common mistake in Oh Hiam would fall under s 46(2)(b) if the case arose in Singapore. Similarly, (claimant) could try arguing that the misrep/undue influence could also fit into s 46(2)(b) LTA. While it is certainly arguable whether a vitiating factor would constitute “enforcing” a contract (TSY), such an approach has impetus in light of Bebe’s restrictive approach to restricting any in personam claims to those directly or indirectly referable to s 46(2).
(Basis for constructive trust)
Third, (claimant) may want to argue that that a constructive trust should be imposed for (mortgagee / tenant / purchaser)’s unconscionable conduct. Though the Bebe has suggested that that only express trusts should be included under s 46(2)(c), (claimant) can argue that allowing a constructive trust to fall within s 46(2)(c) would not compromise the policy objectives of the LTA (per academic Teo Keang Sood).
(SECOND, timing of mistake)
Even if the mistake can be enforced as a in personam claim, there is dicta in Bebe that says that any personal claims that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the mistake arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the mistake arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the mistake arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(THIRD, s 160 rectification)
a. Since the mistake/omission falls within s 46(2), (claimant) should be able to apply to the court for rectification under s 160(1)(b) LTA as well (Bebe).
b. Even though the mistake/omission falls outside of s 46(2), (claimant) could try and argue that the court in Bebe did not intend to strictly limit mistake/omission claims to those within s 46(2). This is because it said at [53] that “such mistakes may fall within s 46(2)”, and not that such mistakes would only fall within s 46(2).
(This situation can be distinguished from Bebe, where the mistake was due to the registry staff and not the bank’s solicitors)
(This situation is similar to the Malaysian case of Oh Hiam, where both parties to a sale of land was under a common mistake as to the land-area. The court in Bebe said this was an example of a mistake that would allow a court-ordered rectification)
(This situation is similar to UOF v Sakayamary, where the omission to obtain court permission under s 35(2) CLPA allowed the court to rectify the register and declare the sale void)
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title by reason that it was procured by undue influence/misrepresentation?
(FIRST, whether misrep/UI can be brought to defeat title)
(Misrep/Undue influence as an in personam claim)
First, (claimant) may want to enforce the action to set aside the mortgage / tenancy / sale for misrep/undue influence as an in personam claim. While the SGCA in Bebe has suggested that that ‘courts should be slow’ to allow in personam claims that do not already fall within the exceptions under s 46(2), and the SGHC in Malayan Banking has applied Bebe’s dicta to exclude an undue influence as an in personam claim, (claimant) could try and argue for a more expansive approach to in personam claims as espoused by academic Kevin Low. According to academic Kevin Low, all personam claims should be enforceable as long as they are not based on a prior property right, since the indefeasibility principle provides immunity only to prior property rights, and not to all claims. On this basis, a misrep/undue influence claim should be enforceable as an in personam claim against (mortgagee / tenant / purchaser) since it is not based on a prior property right.
(Misrep/Undue influence as a vitiating factor under s 46(2)(b) LTA)
Second, even if we keep to Bebe’s restrictive approach to in personam claims, (claimant) may want to argue that the misrep/undue influence claim should nevertheless fall under s 46(2)(b) LTA to vitiate the mortgage contract / tenancy agreement / sale agreement. In Bebe, Chan CJ suggested that the common mistake in Oh Hiam would fall under s 46(2)(b) if the case arose in Singapore. Similarly, (claimant) could try arguing that the misrep/undue influence could also fit into s 46(2)(b) LTA. While it is certainly arguable whether a vitiating factor would constitute “enforcing” a contract (TSY), such an approach has impetus in light of Bebe’s restrictive approach to restricting any in personam claims to those directly or indirectly referable to s 46(2).
(Misrep/Undue influence as a basis for constructive trust)
Third, (claimant) may want to argue that that a constructive trust should be imposed for (mortgagee / tenant / purchaser)’s unconscionable conduct. Though the Bebe has suggested that that only express trusts should be included under s 46(2)(c), (claimant) can argue that allowing a constructive trust to fall within s 46(2)(c) would not compromise the policy objectives of the LTA (per academic Teo Keang Sood).
(SECOND, timing of misrep/undue influence)
Even if the undue influence claim can be enforced as a in personam claim, there is dicta in Bebe that says that any personal claims that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the misrep/undue influence arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the misrep/undue influence arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the misrep/undue influence arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title by enforcing a contract?
The mortgagee / tenant / owner can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA, unless (claimant) can prove that one of the exceptions under s 46(2) should apply to defeat his title.
Here, (claimant) may want to rely on the contract exception under s 46(2)(b) LTA.
On the facts…
(FIRST, was there a contract)
In Bebe, the court suggested that the breach of the promise to honour the claimant’s interest in Betsy would have brought the facts of Betsy under a s 46(2)(b) LTA.
On the facts…
(SECOND, timing of contract)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (contract) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (contract) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (contract) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(THIRD, s 160 rectification)
Since (claimant) is entitled to the contract exception, (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s mistake or omission and the situation also falls within one of the grounds under s 46(2)(b) to (e).
(On the facts, a rectification is unlikely. This is because there is no mistake or omission on the facts.)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by the mistake of…
(This situation can be distinguished from Bebe, where the mistake was due to the registry staff and not the bank’s solicitors)
(This situation is similar to the Malaysian case of Oh Hiam, where both parties to a sale of land was under a common mistake as to the land-area. The court in Bebe said this was an example of a mistake that would allow a court-ordered rectification)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by an omission to…)
(This situation is similar to UOF v Sakayamary, where the omission to obtain court permission under s 35(2) CLPA allowed the court to rectify the register and declare the sale void)
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title by way of a resulting trust?
(FIRST, was there a resulting trust?)
(Placeholder: resulting trust analysis)
(SECOND, can claimant enforce the trust to defeat the indefeasible title?)
The (mortgagee / tenant / owner) can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA.
Thus, the next issue is whether (claimant) can defeat (mortgagee / tenant / purchaser)’s indefeasible title under the trust exception of s 46(2)(c).
First, the SGCA in Loo Chay Sit has suggested that a resulting trust would fall within s 46(2)(c). On this basis, (claimant) should be able to enforce a resulting trust against (mortgagee / tenant / owner)’s indefeasible title. However, this argument may be difficult to make because the SGCA in Bebe has taken the opposite view that s 46(2)(c) should include only an express trust.
Second, it may be possible to argue that the resulting trust should be enforceable as an in personam claim. While the SGCA in Bebe has suggested that that ‘courts should be slow’ to allow in personam claims that do not already fall within the exceptions under s 46(2), (claimant) could try and argue against this by adopting academic Kevin Low’s argument that all personam claims should be enforceable as long as they are not based on a prior property right, since the indefeasibility principle provides immunity only to prior property rights, and not to all claims. On this basis, a resulting trust claim should be enforceable as an in personam claim against (mortgagee / tenant / purchaser) since it is not based on a prior property right.
(THIRD, timing of trust)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (trust) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (trust) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (trust) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(FOURTH, s 160 rectification)
Assuming that (claimant) is entitled to the trust exception under s 46(2)(c), (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s mistake or omission and the situation also falls within one of the grounds under s 46(2)(b) to (e).
(On the facts, a rectification is unlikely. This is because there is no mistake or omission on the facts.)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by the mistake of…
(This situation can be distinguished from Bebe, where the mistake was due to the registry staff and not the bank’s solicitors)
(This situation is similar to the Malaysian case of Oh Hiam, where both parties to a sale of land was under a common mistake as to the land-area. The court in Bebe said this was an example of a mistake that would allow a court-ordered rectification)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by an omission to…)
(This situation is similar to UOF v Sakayamary, where the omission to obtain court permission under s 35(2) CLPA allowed the court to rectify the register and declare the sale void)
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title by way of an express or constructive trust?
(FIRST, was there an express trust or constructive trust?)
Given that (mortgagee / tenant / owner) had agreed to recognise (claimant’s interest) in the land in a written contract, there is likely an express trust. An analogy can be made with the facts in Betsy, where the mortgagee had agreed to give effect to the claimant’s unprotected interest. Though Betsy held that a constructive trust had formed. the court in Bebe said that this would also give rise to an express trust.
Given that (mortgagee / tenant / owner) had already agreed to recognise (claimant’s interest) in the land, it would be unconscionable for them to repudiate their promise. Thus, there is likely a constructive trust on the facts.
(An analogy can be made with Bahr, where a constructive trust was formed because it was similarly unconscionable for the purchasers to renege on their acknowledgement of the claimant’s unprotected interest in the land, even though it was not a condition to the bargain.)
(An analogy can be made with Betsy, where a constructive trust was formed because it was similarly unconscionable for the mortgagee to renege from their promise to give effect to the claimant’s unprotected interest, especially since it was a condition to the bargain.)
(SECOND, can claimant enforce the trust to defeat the indefeasible title?)
The (mortgagee / tenant / owner) can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA.
Thus, the next issue is whether (claimant) can defeat (mortgagee / tenant / owner)’s indefeasible title under the trust exception of s 46(2)(c).
Assuming that an express trust was formed on the facts, (claimant) should be able to enforce the trust against (mortgagee / tenant / owner). The court in Bebe has interpreted the trust exception to include an express trust.
Alternatively, if only a constructive trust was formed on the facts, the SGCA in Betsy has held that a constructive trust would fall within s 46(2)(c). Thus, (claimant) should be able to enforce the constructive trust against (mortgagee / tenant / purchaser). Though the SGCA in Bebe has suggested that that only express trusts should be included under s 46(2)(c), these remarks were only obiter dicta, and Betsy is strictly speaking still the law in Singapore. It is submitted that the ratio in Betsy should be maintained, as allowing a constructive trust to fall within s 46(2)(c) would not compromise the policy objectives of the LTA (per academic Teo Keang Sood).
Alternatively, (claimant) may want to enforce the constructive trust as an in personam claim. While the SGCA in Bebe has suggested that that ‘courts should be slow’ to allow in personam claims that do not already fall within the exceptions under s 46(2), slow is not no. (Claimant) could try and argue for a more expansive approach to in personam claims by adopting academic Kevin Low’s argument that such claims should be enforceable against the registered proprietor as long as they are not based on a prior property right, since the indefeasibility principle provides immunity only to prior property rights. On this basis, a constructive trust claim should be enforceable as an in personam claim against (mortgagee / tenant / purchaser) since it is not based on a prior property right.
(THIRD, timing of trust)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (trust) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (trust) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (trust) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(FOURTH, s 160 rectification)
Assuming that (claimant) is entitled to the trust exception under s 46(2)(c), (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s mistake or omission and the situation also falls within one of the grounds under s 46(2)(b) to (e).
(On the facts, a rectification is unlikely. This is because there is no mistake or omission on the facts.)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by the mistake of…
(This situation can be distinguished from Bebe, where the mistake was due to the registry staff and not the bank’s solicitors)
(This situation is similar to the Malaysian case of Oh Hiam, where both parties to a sale of land was under a common mistake as to the land-area. The court in Bebe said this was an example of a mistake that would allow a court-ordered rectification)
(On the facts, a rectification is likely. (Mortgagee / tenant / purchaser) had obtained his title by an omission to…)
(This situation is similar to UOF v Sakayamary, where the omission to obtain court permission under s 35(2) CLPA allowed the court to rectify the register and declare the sale void)
Analysis: Is (client) entitled to compensation under s 151 assurance fund?
Analysis: Can the court rectify the register under s 160 for a mistake or omission?
(Claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s mistake or omission and the situation also falls within one of the grounds under s 46(2)(b) to (e).
a. Since the mistake/omission falls within s 46(2), (claimant) should be able to apply to the court for rectification under s 160(1)(b) LTA as well (Bebe).
b. Even though the mistake/omission falls outside of s 46(2), (claimant) could try and argue that the court in Bebe did not intend to strictly limit mistake/omission claims to those within s 46(2). This is because it said at [53] that “such mistakes may fall within s 46(2)”, and not that such mistakes would only fall within s 46(2).
(This situation can be distinguished from Bebe, where the mistake was due to the registry staff and not the bank’s solicitors)
(This situation is similar to the Malaysian case of Oh Hiam, where both parties to a sale of land was under a common mistake as to the land-area. The court in Bebe said this was an example of a mistake that would allow a court-ordered rectification)
(This situation is similar to UOF v Sakayamary, where the omission to obtain court permission under s 35(2) CLPA allowed the court to rectify the register and declare the sale void)
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title on grounds of fraud? (general)
The mortgagee / tenant / purchaser can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / owner) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA, unless (claimant) can prove that one of the exceptions under s 46(2) should apply to defeat his title.
Here, (claimant) may want to rely on the fraud exception under s 46(2)(a), which has been judicially interpreted to mean actual fraud, dishonesty or moral turpitude (Bebe).
(On the facts, there is unlikely to be any fraud, because (claimant) was not dishonest). An analogy can be made with Waimiha, where the Privy Council held that the registered proprietor was not dishonest because he was transparent about his intentions to register the title despite knowing that the claimant original caveator had appealed the discharge of the original caveat. Similarly here… )
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title on grounds that the mortgagee’s improper exercise of the power of sale to the purchaser was fraudulent?
The mortgagee / tenant / owner can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA, unless (claimant) can prove that one of the exceptions under s 46(2) should apply to defeat his title.
Here, (claimant) may want to rely on the fraud exception under s 46(2)(a), which has been judicially interpreted to mean actual fraud, dishonesty or moral turpitude (Bebe).
(FIRST, was there fraud?)
The orthodox approach to s 46(2)(a) is that the fraud exception includes only actual fraud, dishonesty or moral turpitude.
In Latec Investments, the court held that the proprietor’s collusive and colourable sale of mortgaged property to its own subsidiary in breach of its duty to exercise the sale in good faith was also another type of equitable fraud. On the facts…
(SECOND, timing of fraud)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (fraud) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (fraud) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (fraud) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(THIRD, s 160 rectification)
Since (claimant) is entitled to the fraud exception, (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s fraud. This will directly overlap with the fraud exception of s 46(2). Thus, since the (claimant) is successful in the fraud exception, he can likely obtain a court-ordered rectification under s 160(1)(b).
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title on the grounds of wilful blindness akin to fraud?
The mortgagee / tenant / owner can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA, unless (claimant) can prove that one of the exceptions under s 46(2) should apply to defeat his title.
Here, (claimant) may want to rely on the fraud exception under s 46(2)(a), which has been judicially interpreted to mean actual fraud, dishonesty or moral turpitude (Bebe).
Since (3P)’s conduct was fraudulent/wrongful, the issue is whether (claimant) can defeat (mortgagee / tenant / purchaser)’s indefeasible title because (mortgagee / tenant / purchaser)’s wilful blindness was akin to fraud.
(FIRST, was there wilful blindness akin to fraud?)
As a starting point, a third-party’s fraud or forgery will not affect the (mortgagee / tenant / purchaser)’s title unless he/she or his/her agent was a party to it (s 46(2)(a)). However, courts have held that a (mortgagee / tenant / purchaser) who knew enough about the third-party’s fraud to make it his/her duty as an honest person to make further inquiries, but abstained from doing so for fear of learning out the truth, may nevertheless be guilty of wilful blindness akin to fraud (Assets, Waimiha, Bebe)
(On the facts, it is unlikely that (mortgagee / tenant / purchaser) will be guilty of wilful blindness akin to fraud because he was merely negligent in finding out the truth. An analogy can be mad with Bebe, where the court did not find any wilful blindness akin to fraud because the facts indicated that the mortgagee’s agent was merely negligent at most in failing to check if the original certificate of title was correct. Similarly here,)
(On the facts, it is likely that (mortgagee / tenant / purchaser) will be guilty of wilful blindness akin to fraud because… Unlike the situation in Bebe, where the mortgagee’s agent could only be said to be negligent at most in failing to discover the true state of affairs, (mortgagee / tenant / purchaser) had reasons to be suspicious of fraud and had refrained from making further inquiries not out of mere negligence, but of fear for discovering the true state of affairs
(SECOND, timing of fraud)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (fraud) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (fraud) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (fraud) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(THIRD, s 160 rectification)
Since (claimant) is entitled to the fraud exception, (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s fraud. This will directly overlap with the fraud exception of s 46(2). Thus, since the (claimant) is successful in the fraud exception, he can likely obtain a court-ordered rectification under s 160(1)(b).
Analysis: Can (claimant) defeat (mortgagee / tenant / purchaser)’s title on basis that the proprietor’s repudiation of his promise to recognise the (claimant’s) unprotected interest was fraudulent?
The mortgagee / tenant / owner can be considered a registered proprietor (s 4 LTA). (Mortgagee / tenant / purchaser) is also considered a “purchaser” since he provided valuable consideration (s 4 LTA). Thus, (mortgagee / tenant / owner) will have an indefeasible title under s 46(1) LTA, unless (claimant) can prove that one of the exceptions under s 46(2) should apply to defeat his title.
Here, (claimant) may want to rely on the fraud exception under s 46(2)(a), which has been judicially interpreted to mean actual fraud, dishonesty or moral turpitude (Bebe).
Since (mortgagee / tenant / owner) had promised to recognise (claimant’s) unprotected but later repudiated it, the issue is whether (mortgagee / tenant / purchaser)’s repudiation amounted to actual fraud or equitable fraud.
(FIRST, was there actual fraud or equitable fraud?)
As a starting point, mere notice or acknowledgement of the claimant’s unprotected interest is not fraud by itself (s 47(2) LTA). However, the cases have shown that there may be actual fraud when a registered proprietor dishonestly promises under a written contract to recognise the unprotected interest (Loke Yew, majority in Bahr, endorsed in Betsy).
(On the facts, there is likely actual fraud because the promise to recognise (claimant’s) unprotected interest was never intended to be honoured at the time it was given. An analogy can be drawn with Loke Yew, where the court found actual fraud when the proprietor had contractually stipulated to ‘make [its] own arrangements’ with regards to the claimant’s interest even though it had no intention to do so at the time of the contract. Similarly…)
(On the facts, there is likely no actual fraud because (registered proprietor) had intended to honour the promise when it was made, even though he later changed his mind and repudiated the promise. An analogy can be drawn with Bahr, where the majority found no actual fraud because even though the proprietor had promised to honour an express repurchase provision (in favour of the claimants) and had later repudiated this promise, there was no evidence that the proprietor had intended not to honour the promise when it was given. Instead, the proprietor had only hoped that they would not have to go through with it in the end. Similarly…)
(An analogy can also be drawn with Betsy, where the SGCA found no actual fraud. Though the proprietor was had promised in the contract to recognise the claimant’s unprotected interest and later repudiated this promise, there was no finding of a dishonest intention when the promise was given. While the repudiation was unconscionable, it was not fraudulent. Though the SGCA in Bebe has suggested that there was actual fraud in Betsy because the promise to honour the claimant’s unprotected interest was a condition to the sale, this dicta has been criticised by academic Kevin Low, who has pointed out that there would still be no dishonest intention on the facts to establish actual fraud. Similarly / In contrast…)
Alternatively, some cases have suggested that the fraud exception should include not only actual fraud, but also equitable fraud when there is “an element” of dishonesty or moral turpitude in the proprietor’s present conduct (minority in Bahr, Latec Investments). However, this concept of equitable fraud has not been endorsed in Singapore.
In Bahr, the minority held that even if a promise to recognise the claimant’s unprotected interest was honestly given but later repudiated, the proprietor’s repudiation would be a form of equitable fraud if the promise was the “foundation or assumption” underlying the contract. On the facts…
In my view, even though Singapore has yet to endorse the inclusion of equitable fraud under s 46(2)(a), it is unlikely to do so because..,,
(SECOND, timing of fraud)
There is dicta in Bebe that says that any fraud/personal claim/defeasible condition/overriding interest that serves to defeat the title must arise exist either before or at the time the contract was formed, or at the time of registration (Bebe).
a. On the facts, this is met as the (fraud) arose at the time of registration / before or at the time the contract was formed
b. On the facts, this is not met as the (fraud) arose after the title was registered. On a strict reading of Bebe, the title is indefeasible and cannot be defeated. However, the claimant may try an argue for Prof Teo’s approach, as he has argued that any unconscionable behavior arising after the registration of the title should still be permitted to defeat the title, as holding otherwise would allow an unmeritorious proprietor to hide behind the registered title)
c. On the facts, this is not met as the (fraud) arose after the contract was formed but before registration.
However, (clamant) may try to argue against Bebe’s interpretation by pointing out that under s 47(3), the protection conferred at the date of the contract refers only to those under s 47 (“this section”) only (per academic Teo Keang Sood), and not the indefeasibility under s 46. Thus, a defeasible condition that arises before registration should still be enforceable.
Alternatively, (claimant) might suggest that since it is difficult to draw a line between acts after the contract and before registration and acts at the time of registration, a more appropriate reading of Bebe is that the defeasible condition must arise at any time before registration.
(THIRD, s 160 rectification)
Since (claimant) is entitled to the fraud exception, (claimant) may also want to apply to the court to rectify the land-register by 160(1)(b). SGCA in Bebe has interpreted s 160(1)(b) to mean that the court can rectify the land-register when the instrument was obtained by the registered proprietor (or his agent)’s fraud. This will directly overlap with the fraud exception of s 46(2). Thus, since the (claimant) is successful in the fraud exception, he can likely obtain a court-ordered rectification under s 160(1)(b).
