Untitled

Press, 6 May 1981, Page 27

PA Wellington The Land Transfer Act.

1952,, should be amended so that compensation can be made to any person buying property or acquiring an interest in land who suffers a loss because of an adverse claim not disclosed by a search of certificate of title. This is a recommendation of the Property Law and Equity Reform Committee in a report on the 1978 High Court Case Bradley v. Attor-ney-General. The report has been released by the Attorney-Gen-eral, Mr McLay. The report says that under the land transfer system documents are lodged in the Land Registry Office. If in order, they are registered against the certificate of title. For various reasons time can elapse between the lodgement of documents and their registration. In Bradley’s case a firm of solicitors was held liable to compensate its client because it failed to discover from a search of the certificate of title before settlement that a mortgage had been lodged for registration. By the time the firm had settled the purchase for its client, the property had become subject to a registered mortgage. The committee proposed four possible solutions to deal with the situation. The solution receiving most support in submissions to the committee, and recommended by it, provided for the State to indemnify all people dealing in good faith and for valuable consideration on the basis of search note copies of certificates of title issued by the Land Registry Office within seven days before settlement out of the Consolidated Revenue Account. This is already done if someone suffers a loss because of a mistake by the registrar or his staff. g’he committee also recommended that the State be entitled to recover the compensation paid from any solicitor or other person whose negligence caused or contributed to the loss. The committee noted that the solution it most strongly supported was designed to cover a risk' of perhaps one or two cases in a million. Mr McLay indicated that the committee’s report would be considered in the present review of the Land Transfer Act•