- Alan Frazer and Flora Frazer were joint owners of a New Zealand dairy farm under the Land Transfer Act 1952 (NZ) (the Act).
- Mrs Frazer borrowed ₤3,000 from the Radomskis, using the dairy farm as security for this loan without her husband’s consent.
- The contract needed both of the Frazers’ signatures for the mortgage to be legally valid.
- Mrs Frazer forged Mr Frazer’s signature and persuaded her lawyer’s clerk to falsely witness the signature of Mr Frazer.
- Mrs Frazer paid out the existing mortgage on the property and retained a sum of money for herself.
- The Radomskis’ sold the farm to Mr Walker for ₤5000.
- Both the Radomskis and Mr Walker were unaware of Mrs Frazer’s fraud.
- Mr Walker was registered as to the legal owner. Mr Frazer refused to recognise Mr Walker’s legal interest in the farm – Mr Walker commenced proceedings for possession of the farm.
- Was Mr Walker’s title to the property legal, despite the defective title caused by Mrs Frazers’ fraud?
- Mr Walker was a “bona fide purchaser for value without notice”.
- Mr Walker was unaware of Mrs Frazer’s fraud at the time of purchase, as were the Radomkis.
- This mean that Mr Walker had indefeasible title.
- This position was consistent with section 183 of the Act, which stated that fraud would not defeat a “bona fide purchaser for valuable consideration”.
The full text is available here: http://www.bailii.org/uk/cases/UKPC/1966/1966_27.pdf
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