Wednesday, August 27, 2014
Douglas Harris (UBC) & May Au (UBC) have posted Title Registration and the Abolition of Notice in British Columbia (UBC Law Review) on SSRN. Here's the abstract:
Systems of land law must balance competing goals of securing title for existing interests in land with facilitating their transfer. Title registration systems operate to facilitate transfers of interests in land. They reflect a choice to enhance the security of transfers of interests, providing what has been characterized as dynamic security at the expense of the static security of existing interests. One of the cardinal principles of title registration is the abolition of the doctrine of notice. In equity, if purchasers of a legal interest have notice of a prior equitable interest, then they take their interest subject to that prior interest. To do otherwise is to perpetrate a fraud. Most title registration systems abolish notice; prior unregistered interests do not affect purchasers who register their interests, whether or not they have notice of the prior interest, except, so many title registration statutes provide, in the case of fraud. This article investigates the evolution of provisions purporting to abolish notice in Torrens title jurisdictions, it describes the variety of provisions that emerged, it reviews the longstanding uncertainty in British Columbia over the extent to which the doctrine of notice is abolished, and it considers a number of proposals for reform. It concludes that the uncertainty is a function of an unresolved policy choice between static and dynamic security, and that the British Columbia Court of Appeal or the legislature needs to intervene to clarify that choice.