A transfer lodged for registration in the knowledge it had been signed by the attorney of the deceased transferor four days after his death, has nevertheless delivered indefeasible title to the transferee, a court has ruled.
Colin Trouton died on the Gold Coast on 15 June 2007.
On 19 June, his son Neil and daughter-in-law Leanne procured Colin’s widow Patricia to execute a transfer of a property at Harbut Street, Holland Park West in their favour.
Patricia signed the transfer of their former family home in her own capacity and also on Colin’s behalf as his attorney.
All parties claimed not to have known that the power of attorney had lapsed on the death of the deceased transferor.
The transfer had been prepared in May 2007 to give effect to an agreement whereby Neil and Leanne would pay $550k for the site so they could renovate it and use it as their family home and at the same time build a granny flat for occupation by the transferors.
A substantial part of the purchase price was destined to pay out RAMS, the mortgagee of the property.
But for the transfer, title in the property would have passed to Patricia – who was then residing at Broadbeach – under the law of survivorship.
In early 2017, Neil’s sister Chrissie conducted a title search and was shocked to find the title had been transferred in 2007.
That prompted Patricia to claim she no knowledge of the property being transferred and to allege that she had been coerced by Neil to sign the transfer.
Patricia lodged a caveat in April 2017 and a sworn declaration with the Registrar of Titles recounting the circumstances in which she alleged the transfer had been executed.
A caveat by the Registrar followed in July 2017 and shortly after, Patricia started civil fraud proceedings in the Supreme Court at Brisbane to have the Harbut Street property re-conveyed to her.
She contended she had no understanding of whatever she may have signed at Neil’s request in the days following her husband’s death.
Further, by urgently lodging the transfer for registration on the afternoon following its execution and well after Colin’s power of attorney had lapsed, Leanne had perpetrated a fraud – she alleged – on the Registrar of Titles as well as on her.
When these and other inter-family grievances came before Justice Frances Williams, she observed there had been a “total breakdown of the family relationship”.
Each side claimed the other was lying and exaggerating.
Her honour noted after the 17 day trial in September and December 2021, that Patricia’s evidence was neither credible nor reliable.
Likewise Chrissie, whose account of supposedly having first realised in 2017 that the Harbut Street property had been transferred to her older brother and his wife was rejected as “implausible”.
“I do not accept the evidence of Christine Trouton,” she ruled.
In her view the urgency with which the transfer had been lodged for registration did not suggest any attempt by Neil or Leanne to cover their tracks. Rather, her impression of the evidence was that at the time the document was presented to the Titles Office, they believed it to be a competent document which could be properly acted upon.
She also found that Patricia, Neil and Leanne “honestly, but mistakenly, thought the Form 1 Transfer was properly executed on behalf of Colin Trouton” even though this occurred after the power of attorney had lapsed.
Observing that “a person who presents for registration a document which is forged or has been fraudulently or improperly obtained is not guilty of fraud if he honestly believes it to be a genuine document which can be properly acted upon,” the defendants’ conduct was not coloured by fraud.
“As a consequence of these findings, the plaintiff’s claim must fail [and] the defendants obtained indefeasible title upon registration of the transfer,” she concluded.
Justice Williams – in adjudicating Neil and Leanne’s counterclaim for “overpayments” – accepted they had paid a total of $532k in mortgage payments to RAMS by November 2021 – which included drawdowns they claimed had been concealed from them – and further sums thereafter.
They also sought reimbursement of a further $95k – nearly half of which were debts payable by Patricia and Chrissie’s retail fashion business – that had been advanced.
Her honour concluded that the claim for deceit regarding any part of those sums had not been made out but until a final order is made, it is unclear whether it will include orders in respect of the counterclaim’s alternative causes of action, namely unjust enrichment and breach of contract.