Mudge and Mudge v Secretary for Lands, The State and Delta Developments Pty Ltd [1985] PGLawRp 499; [1985] PNGLR 387 (6 December 1985)

Papua New Guinea Law Reports - 1985

[1985] PNGLR 387 - Mudge and Mudge v The Secretary for Lands, The State and Delta Developments Pty Ltd 

[1985] PNGLR 387

SC308

PAPUA NEW GUINEA

[SUPREME COURT OF JUSTICE]

MUDGE AND MUDGE

V

SECRETARY FOR LANDS

FIRST RESPONDENT

AND THE INDEPENDENT STATE OF PAPUA NEW GUINEA

SECOND RESPONDENT

AND DELTA DEVELOPMENTS PTY LTD

THIRD RESPONDENT

Waigani

Kidu CJ Pratt Woods JJ

31 July 1985

6 December 1985

TORRENS SYSTEM - Indefeasibility of title - Principles applicable to registration under Land Registration Act - Land Registration Act (Ch No 191), ss 33, 36 - Land Act (Ch No 185), ss 9, 29, 57.

REAL PROPERTY - Land Registration Act - Registration under Act confers indefeasible title - Torrens system principles applicable - Lease issued in breach of Land Act - Lease registered - Indefeasible title conferred - Land Registration Act (Ch No 191), ss 33, 36 - Land Act (Ch No 185), ss 9, 29, 57.

Held

N1>(1)      Registration of leases under the provisions of the Land Registration Act (Ch No 191) is effective to vest an indefeasible title in the registered proprietor subject only to the exceptions enumerated in s 33.

Frazer v Walker [1967] 1 AC 569; Breskvar v Wall (1971) 126 CLR 376, adopted and applied.

N1>(2)      Accordingly, notwithstanding that a State lease issued under the Land Act (Ch No 185) may have been issued irregularly and in breach of the provisions of that Act, registration under the Land Registration Act will confer an indefeasible title.

Cases Cited

Assets Co v Mere Roihi [1905] UKLawRpAC 11; [1905] AC 176.

Avia Aihi v The State [1981] PNGLR 81.

Boyd v Mayor of Wellington [1924] NZGazLawRp 58; [1924] NZLR 1174.

Breskvar v Wall (1971) 126 CLR 376.

Clements v Ellis [1934] HCA 18; (1934) 51 CLR 217.

Frazer v Walker [1967] 1 AC 569.

King v Mayor, Etc of Kew [1884] VicLawRp 87; (1884) 10 VLR, L 183.

Mayer v Coe [1968] 2 NSWR 747.

Metropolitan Water, Sewerage & Drainage Board v OK Elliott Ltd [1934] HCA 57; (1934) 52 CLR 134.

Thompson v Council of the Municipality of Randwick [1944] NSWStRp 10; (1944) 44 SR (NSW) 455.

Appeal

This was an appeal from a decision of Bredmeyer J in which his Honour found that there had been breaches of the provisions of the Land Act (Ch No 185) in respect of the granting of a State lease which was subsequently registered under the provisions of the Land Registration Act (Ch No 191), but refused to make orders forfeiting the lease.

Counsel

P Donigi, for the appellants.

J Goodman, for the first and second respondents.

J Gawi, for the third respondent.

Cur adv vult

6 December 1985

KIDU CJ:

BACKGROUND OF THE APPEAL

My brother Woods J has covered the background of this appeal and it is not my intention to go over the same ground.

PRELIMINARY POINT

Counsel for the first and second respondents, as a preliminary point, submitted that the first respondent cannot be sued as the office has no corporate personality. There cannot be any doubt that the office is a public service one created by the Head of State on advice pursuant to the Public Service Act (Ch No 67), s 14. As it is not a corporate entity that can sue or be sued I agree with counsel that the first defendant was an incompetent defendant. In law only a person (a human being of age) or a corporate person (an incorporated body) can sue or be sued in a court. In this case the appellant should have proceeded against the occupant of the office of the Secretary for Lands.

ORDERS CLAIMED IN THE NATIONAL COURT

In the National Court the appellants took out an originating summons (OS 8 of 1983) claiming the following orders:

N2>“1.      That the First Defendant as servant and/or agent of the Second Defendant acted ultra vires the Land Act (Ch No 185) in exempting the land known as Allotment 13 Section 156, Boroko and being the whole of the area described in the State Lease Volume 80 Folio 123 from being publicly advertised for persons to apply for the said property in accordance with the provisions of the Land Act (Ch No 185).

N2>2.       That the First Defendant as servant and/or agent of the Second Defendant acted illegally contrary to the Land Act (Ch No 185) in granting or causing a grant of the land being Allotment 13 Section 156, Boroko and being the land described, in the State Lease Volume 80 Folio 123 to Delta Developments Pty Ltd, a company duly incorporated in Papua New Guinea.

N2>3.       That the First Defendant as servant and/or agent of the Second Defendant acted illegally contrary to the Land Act (Ch No 185) by not considering the application of the Plaintiff or caused to be forwarded to the proper body or persons the application of the plaintiff in respect of the same land abovenamed.

N2>4.       That the defendants forfeit the lease granted to Delta Developments Pty Ltd and cause to be convened a proper Land Board hearing to consider applications for the said property by the plaintiff and any other interested applicants on their merits.

N2>5.       Such other and further Orders as this Honourable Court sees fit.”

DECISION BY THE NATIONAL COURT

Bredmeyer J found that there had been breaches of the Land Act (Ch No 185) in that s 6 and s 29(3) of that Act had not been complied with. But the learned trial judge rejected the submission by counsel for the appellants that these breaches invalidated the registered title of the third respondent. In rejecting it his Honour said, inter alia, in his judgment:

“As I have said, I consider there have been two aspects of maladministration in the grant of the lease to Delta. The lease should not have been granted before the rezoning was gazetted, and the chairman should have given written notice to Mudge of the application for lease as he was a person who, to the knowledge of the chairman, was interested in the application. What orders should flow from these conclusions? Mr Donigi has argued that I should order the State to forfeit the lease granted to Delta. I do not think that I can order the Minister to forfeit the lease under s 46 of the Land Act. He has his powers under that section; it is up to him whether he wishes to exercise those powers. Section 46(1)(b)(ii) is a possibility but it seems to me that all of the grounds for forfeiture require fault in one way or another on the part of the lessee; for example, fault in failure to pay the rent or in failure to obey a covenant or condition of lease etc, and in this case no fault has been proved against Delta in the way it obtained the lease.

Although not expressly asked for I undoubtedly have power to grant a declaration. That is normal under s 155(4) of The Constitution for an excess of power or an illegal administrative act. But it is a discretionary remedy and I do not propose to grant it. There has been a delay in bringing this case. It has not been a long delay. The originating summons was filed about one month after the registration of the lease; nevertheless in the circumstances it is a significant delay. In the interval Delta has expended K23,000 on improving the land the subject of the lease. But the more fundamental reason why I consider no declaratory order should be made is that of [the lease] is indefeasible subject to certain exceptions under s 33 and s 36 of the Land Registration Act 1981. Mr Donigi has been unable to satisfy me that his client comes under any of the nine exceptions stated there, or that s 160 and s 161, which give the Registrar a limited power to correct instruments and titles, has any application to the facts of this case. I have not been cited any authorities on Torrens Acts elsewhere to show that when a Crown lease has been granted in breach of several statutory provisions its registration can be upset in the absence of fraud or one of the other stated exceptions. No fraud has been alleged or proved against anyone. I do not think that is a failure of research on Mr Donigi’s part; I would be very surprised if there was any such authority. The kind of indefeasibility conferred by a Torrens statute — is a very real and important thing. I am absolutely sure that the facts of this case give me no grounds whatsoever to upset the indefeasibility of that title. Whether as a result of my findings the plaintiff would have any claim against the State in damages I do not know. No such claim is made in the originating summons and I am not going to decide that. All the orders claimed in the originating summons are refused and the summons will be dismissed with costs.” [Emphasis added.]

GROUNDS OF APPEAL

The appellants’ grounds of appeal are as follows:

N2>“1.      That the judgment of the learned judge was wrong in law.

N2>2.       That the learned judge misdirected himself, took into account irrelevant considerations or ignored relevant matters:

(a)      in holding that the lease granted to Delta Developments Pty Ltd under a valid law was not harsh or oppressive under Section 41 of the Constitution.

(b)      in holding that “Delta has a registered Torrens type lease of the land which is indefeasible subject to certain exceptions under ss 33 and 36 of the Land Registration Act 1981”.

(c)      in finding that there has been a delay of one (1) month in bringing the case and that it was a significant delay.

(d)      in finding that section 155(4) of the National Constitution provides for a discretionary remedy without directing himself to the effect of and operation of Sections 32, 33 and 37 of the National Constitution.

(e)      in not taking into account his jurisdiction under Section 155(5) of the National Constitution by refraining from directing the Minister to forfeit the lease under Section 46 of the Land Act.

(f)      in not allowing Counsel for the Plaintiffs to cross-examine one Anthony Sim, the Manager and Director of Delta Developments Pty Ltd on the company’s legal standing under the National Investment and Development Act (Ch No 120).

(g)      in failing to consider the applicability of Sections 32, 33 and 37 of the Constitution.

N2>3.       That the learned trial judge acted ultra vires his powers by exercising the powers granted to the Supreme Court under section 18 of the National Constitution by holding that the lease granted to Delta Developments Pty Ltd was not harsh or oppressive under Section 41 of the Constitution and/or failing to refer the questions of applicability of Sections 32, 33 and 37 of the Constitution to the Supreme Court.”

The third respondent has a State lease registered under the Land Registration Act (Ch No 191) and although the appellants have raised eight questions of law (including constitutional laws) the real question for determination by this Court is whether, apart from exceptions enumerated in the Land Registration Act, s 33, land once registered attracts the principle of indefeasibility of title. This Act and its forerunners — the Real Property Ordinance (Papua) and the Land Registration Ordinance (NG) — are based on Australian Acts. They all reflect what is commonly known as the Torrens system of land registration Under legislations based on this system (in Australia and New Zealand) it is now settled law that, apart from exceptions mentioned in the relevant legislations, once land is registered under the Torrens system the owner acquires indefeasibility of title. The relevant judicial authority in respect of New Zealand is the Privy Council decision in Frazer v Walker [1967] 1 AC 569 and in Australia it is the decision of the High Court in Breskvar v Wall (1971) 126 CLR 376. Counsel for the appellants ignored these authorities. The thrust of his main submission was that as the Land Registration Act had to be read subject to the Land Act any breach or non-compliance of the latter Act rendered registration of any estate or interest in land invalid. The Land Act does not say this. But Mr Donigi relied on ss 36(2), 37, 38(1)(c) and 39 of the Land Registration Act. However I consider that these provisions in no way affect the indefeasibility of title of a State lease once it is registered. Section 33 is too clear to have its effect eroded by the provisions relied upon by the appellants’ counsel. As Barwick CJ said in Breskvar v Wall at 385-386:

“The Torrens system of registered title of which the Act is a form is not a system of registration of title but a system of title by registration. That which the certificate of title describes is not the title which the registered proprietor formerly had, or which but for registration would have had. The title it certifies is not historical or derivative. It is the title which registration, itself has vested in the proprietor. Consequently, a registration which results from a void instrument is effective according to the terms of the registration. It matters not what the cause or reason for which the instrument is void. The affirmation by the Privy Council in Frazer v Walker of the decision of the Supreme Court of New Zealand in Boyd v Mayor of Wellington [1924] NZGazLawRp 58; [1924] NZLR 1174 at 1223 now places that conclusion beyond question. Thus the effect of the Stamp Act 1894 (Qld) upon the memorandum of transfer in this case is irrelevant to the question whether the certificate of title is conclusive of its particulars.”

I now deal with the other grounds of appeal.

Ground 2(a)

I consider that on the facts the learned trial judge was correct in his view that the lease granted to the third respondent was not harsh or oppressive under the Constitution, s 41.

Ground 2(c)

A month’s delay could not be said to be a significant one. But as the third respondent had acquired an indefeasible title on registration it is neither here nor there that there was a delay by the appellants in bringing a suit against the respondents.

Ground 2(d)

Section 155(4) of the Constitution does provide for a discretionary remedy: see Avia Aihi v The State [1981] PNGLR 81. I cannot see the relevance of ss 32, 33 and 37 to considerations under s 155(4). These provisions do not make remedies under s 155(4) imperative.

Ground 2(e)

Section 155(5) of the Constitution refers to s 155(3)(e) which relates to judicial power/authority. This appeal relates to the exercise of non-judicial power.

Ground 2(f)

The National Development and Investment Act (Ch No 120) had no relevance to the case. It does not say that a non-citizen cannot be granted a State lease. In fact the finding of the learned trial judge was that the third respondent was a national company, that is, wholly owned by citizens.

Ground 2(g)

The relevance of ss 32, 33 and 37 of the Constitution to the case eludes me.

Ground 3

The National Court has power under s 23(2) and s 155(4) of the Constitution to entertain matters brought under s 41.

I would dismiss the appeal with costs.

PRATT J: As Bredmeyer J observed in his trial judgment, the facts in this matter are not greatly in dispute. J D Mudge and his wife were lessees of a business lease on allotment 10, section 56, Boroko. Next door to them there was a vacant plot of land through which a storm water drain ran near the eastern boundary of the Mudge’s property. With a view to expanding his business, Mr Mudge initiated preliminary negotiations to acquire this block of land, the first step of which required a survey, and rezoning of the block from open space to commercial. Between May and November 1982 the Town Planning Board considered an application of Mr Mudge, but deferred a decision pending negotiations between Mr Mudge and the National Capital District Interim Commission on a diversion of the drain. The Board’s decision was not communicated to Mr Mudge but was passed on to the Secretary for Lands. As the learned trial judge found, Mr Mudge therefore had “no advice from any source on the result of his application through the Lands Department for rezoning after 24/5/82”. That was where his activities ceased. In the meanwhile however, a Mr Simm had taken an interest in the allotment and as a result of considerable diligence, pressure and forcefulness he managed to acquire the land by means of a State lease signed by a Minister’s delegate on 20 July 1983 (following notification in Gazette No G43 of 7 July 1983 that Mr Simm’s company, Delta Developments Pty Ltd was the successful applicant). What is far more important from the appellant/plaintiff point of view is that such lease was registered as a State lease, Vol 80, Folio 123 on 22 July 1983. I agree with the learned trial judge that the speed with which all this happened was quite unusual.

As at the trial, Mr Donigi for the appellants, has argued a number of matters before this Court, some based on the Constitution, some on the Land Act (Ch No 185) and some on the Lands Registration Act (Ch No 191). The most important of these submissions centres on a failure by the chairman of the Land Board to notify Mr Mudge of the date on which the application by Delta Developments Pty Ltd was being dealt with by the Land Board. Section 9(2) of the Land Act reads as follows:

N2>“(2)    The Chairman shall notify by post every person who, in his opinion, is interested in an application or matter, of the date on which it will be considered by the Land Board.”

I agree with the trial judge that this does not mean adjoining land owners need necessarily be advised; and I further agree that whatever else it means the section required the chairman of the Land Board to notify Mr Mudge of the application as the Lands Department had already knowledge of his interest in the land and it could not be argued that the interest was other than genuine.

Furthermore, says Mr Donigi, the lease has been issued in breach of the Town Planning Act (Ch No 204) and therefore there has been a further contravention of s 29(3) of the Land Act:

“A State Lease shall not be granted for a purpose that would be in contravention of any law relating to Town Planning or to the use, construction or occupation of buildings for lands.”

The lease in this matter of course had been granted before the gazettal of rezoning and thus the State had prevented any appeal under the Town Planning Act. As Bredmeyer J pointed out, there was no point in appealing against the rezoning of the land as commercial when a lease had already been granted and registered and certain moneys had been spent on improvement. Consequently, his Honour also found that the granting of the lease was carried out in breach of s 29(3) of the Land Act.

The crux of the submission is therefore that as the lease was issued in breach of s 29(3) and more particularly in breach of s 9(2) of the Land Act, it is “invalid, illegal, void, worthless”. As the lease originally issued is void, there is no valid registered lease. It is said that the provisions of the Land Registration Act cannot be relied upon because there has been a failure at the outset.

As an ancillary matter Mr Donigi also draws attention to the fact that applications by way of tender for the land were not called as required under the Land Act, s 57(1), and he argues that the provision of s 57(4) which allows the Minister to dispense with tender cannot be of assistance to the defendants in this case because of a failure by the Minister to exercise his power of dispensation in a proper way with due regard to principles of natural justice and fairness. Let me say at this point that although counsel cited a number of authorities I do not find any of them convince me that I should in any way interfere with the Minister’s discretion under this subsection. There are many reasons why the department may decide to do away with tender and in the absence of any evidence of malpractice or impropriety, I do not believe the plaintiff has shown any reason why the Court should see fit to interfere with the exercise of a Ministerial discretion. There must be some concrete material upon which to base such a finding.

Furthermore as counsel for the State pointed out at the commencement of the hearing, the Secretary for Lands is not a legal entity, and the person occupying the position has not been joined as a party. It may well be argued that it is the Minister rather than the Secretary who should have been joined in these proceedings. Certainly, I cannot see how a Court can make an order against the Minister when he himself has not been joined in the proceedings, let alone make a finding in the absence of any evidence that he has exercised his discretion improperly. I do not believe the submissions on this aspect can be upheld.

I return now to the central theme of Mr Donigi’s submissions, namely, that the lease issued on 20 July is void. No explanation has been given as to why a failure by the Land Board to comply with the provisions of the Act should cause an avoidance of the subsequently issued lease. Nor has any authority been cited. The most that can be read out of the authority, Metropolitan Water, Sewerage & Drainage Board v OK Elliott Ltd [1934] HCA 57; (1934) 52 CLR 134, is perhaps best summed up in the judgment of Starke J to the effect that a Board acting in excess of or in abuse of its powers or acting carelessly and negligently may give cause for an action at law. I cannot see how the case can support the contention that a document such as is involved in the present case becomes void because of the negligence on the part of the Land Board in failing to advise Mr Mudge under s 9(9) and s 29(3).

Likewise I am unable to obtain the same comfort as counsel for the appellant from Thompson v Council of the Municipality of Randwick [1944] NSWStRp 10; (1944) 44 SR (NSW) 455 and King v Mayor, Etc of Kew (1884) 10 VLR, L183. Both of these cases deal with the question of encroachment from works or creation of a private nuisance and do not lend themselves to support the proposition that failure by a departmental official or even a Minister to observe certain requirements of a particular Act results in a void document in circumstances such as the present.

When one comes to examine such work as de Smith, Judicial Review of Administrative Action (4th ed, 1980) at pp 151-155 it becomes clear that a distinction exists between what may be regarded as a voidable document and a void document. Nevertheless even in this area there does not appear to be any real relationship between the problems being addressed by Professor de Smith and the one before this Court. Perhaps greater assistance may be found in that area of his work commencing at p 142, where he deals with a “disregard of procedural and formal requirements”, and where there is a breach of procedural or formal rules, such departure is likely to be treated as a mere irregularity if it is of a trivial nature or “if serious public inconvenience would be caused by holding them to be mandatory”. At p 144 the learned author states that “an administrative authority which fails to comply with statutory duty to give prior notice” will be guilty of conduct which is susceptible to correction by the Court. What one has to bear in mind in this particular instance of course is that no proprietary or civil right of the appellant has been affected. What has been affected in this case is a prospective right which the appellant hoped to obtain if certain matters had been resolved in his favour.

In the ultimate, however, I do not believe it is necessary to resolve this somewhat difficult area of law. The course of events in this particular case makes the resolution of the question whether the original lease of document was void or voidable of academic interest only. I agree with Bredmeyer J that had the appellant taken proceedings even after the issue of the lease but before registration, he may well have obtained a declaration and associated order of the court requiring the Land Board to carry out its functions in a proper manner, and more particularly to determine the issue only after requirements of the Land Act, s 9(9) and s 29(3), had been observed. But that was not the factual position that was placed before his Honour. The course which appellant’s counsel has therefore been forced to pursue in this case is really a frontal attack on the principle of indefeasibility of title under the Torrens system in our Land Registration Act, s 33.

The sections dealing with State leases are contained in Pt IV of the Land Registration Act. By s 36(1) the provisions of the Act apply to a “Register of State Leases” and the section equates such Register with that of the ordinary register book and a State lease with an ordinary certificate of title. By s 36(2) a State lease is “subject to the provisions of this Act ... as if it had been granted by a registered proprietor and registered in the register book”. The part of the subsection which I have omitted is not relevant to the present problem in my view, as we are not concerned here with any question of particular requirements under the Land Act regarding methods of dealing with the lease of restrictions placed thereon by the Act. In short, a State lease when registered is in the same position as an ordinary certificate of title under the Torrens system and is therefore subject to the indefeasibility provisions set out in s 33 of the Act.

Section 33 of the Land Registration Act has many counterparts in other jurisdictions. An excellent collection of these counterparts may be found in the work by Francis, The Law and Practice Relating to Torrens Title in Australia, Vol 1, at p 573 ff, wherein he deals with all the Australian States and New Zealand.

A divergence of views developed between Australia and New Zealand as to whether there was immediate indefeasibility on registration or whether such indefeasibility was deferred. The latter view was certainly the one followed for at least three decades in Australia after the decision of the High Court in Clements v Ellis [1934] HCA 18; (1934) 51 CLR 217 which, although an equally divided decision, led to an adoption of the principle enunciated by Dixon J that first registration pursuant to a void instrument need not carry the protection granted by the indefeasibility provisions under the Torrens Acts. The New Zealand approach resulted in an eventual appeal to the Privy Council in the celebrated case of Frazer v Walker [1967] 1 AC 569 and although their Lordships were not obliged by the facts before them to resolve the dispute between the Australian and New Zealand courts, they did go out of their way to support the principle that registration of a void instrument was, in the absence of fraud, “effective to vest and divest title and to protect the registered proprietor against adverse claims”: Frazer v Walker at 584 (see also the most helpful article of Professor Sackville in (1973) 47 ALJ 526).

Faced with the conflict between the Privy Council and the High Court of Australia, Street J, as he then was, resolved the question in the New South Wales Supreme Court in the matter of Mayer v Coe [1968] 2 NSWR 747. With respect I believe that his Honour’s conclusions are quite compelling as to why the view of the Privy Council in Frazer v Walker should be preferred. At 754 of his judgment, Street J says as follows:

“The Privy Council has gone out of its way to dismiss the appeal on a broader ground than was necessary, a ground more far-reaching that [sic] that which sufficed for the New Zealand Court of Appeal. It seems inescapable that their Lordships have done this deliberately to set at rest the doubts that have for many years plagued this particular branch of real property law in Australia and New Zealand. The Privy Council’s decision is direct and binding authority laying down that a registered proprietor who acquires his interest under an instrument void for any reason whatever obtains on registration an indefeasible title. This will avail him against all, unless:

(a)      there is a specific basis under the statute rendering him open to challenge; an example of such a specific basis of challenge is actual fraud on his part or on the part of his agent....”

This is in fact what the learned trial judge said in the present matter at 16 of his judgment:

“Mr Donigi has been unable to satisfy me that his client comes under any of the nine exceptions stated there [s 33 and s 36] or that s 160 and s 161 which give the Registrar a limited power to correct instruments and titles, has any application to the facts of this case. I have not been cited any authorities on Torrens Acts elsewhere to show that when a Crown lease has been granted in breach of several statutory provisions, its registration can be upset in the absence of fraud or one of the other stated exceptions.”

With that view I would respectfully agree, for reasons which I now set forth.

Before the appeal in Mayer v Coe could be dealt with by the High Court of Australia another matter came before it which resolved the dichotomy. In Breskvar v Wall (1971) 126 CLR 376, the High Court departed from the general interpretation which had heretofore been given to the decision Clements v Ellis. Their Honours accepted the reasoning and conclusion of the Privy Council in Frazer v Walker. Briefly the facts in Breskvar’s case were that the plaintiffs as registered proprietors of land in Queensland executed a memorandum of transfer but omitted to place the name of the transferee in the document when they handed it over to a Mr Petrie. It is clear that under the Stamp Act 1894 (Qld), s 53(5), such a transfer was not valid “at law or in equity”. Indeed the section went on to say that a blank transfer was “absolutely void and inoperative”. Unfortunately for the Breskvars, Petrie inserted the name of his grandson, Wall as the transferee and then registered the document. Both Petrie and Wall were acting fraudulently, and it could not be said that Wall acquired any indefeasible title on registration. However, following the registration, he contracted to sell the land to a company who acted in good faith and without notice of the earlier transaction. Before the company could register their transfer in pursuance of the contract with Wall, the Breskvars had lodged a caveat seeking rectification of the register to restore their names as proprietors. It is apparent however that Wall was not able to obtain any indefeasibility because of his fraud and not because of the void instrument. Barwick CJ, with Owen and Windeyer JJ agreeing, firmly rejected the argument that was based on the mere invalidity of the instrument of transfer. At 385-386 of the report, his Honour says:

“The Torrens system of registered title of which the Act is a form is not a system of registration of title but a system of title by registration. That which the certificate of title describes is not the title which the registered proprietor formerly had, or which but for registration would have had. The title it certifies is not historical or derivative. It is the title which registration itself has vested in the proprietor. Consequently, a registration which results from a void instrument is effective according to the terms of the registration. It matters not what the cause or reason for which the instrument is void. The affirmation by the Privy Council in Frazer v Walker of the decision of the Supreme Court of New Zealand in Boyd v Mayor of Wellington [1924] NZGazLawRp 58; [1924] NZLR 1174 now places that conclusion beyond question.”

It should not be overlooked that the Privy Council decision in Assets Co v Mere Roihi [1905] UKLawRpAC 11; [1905] AC 176, the very keystone and earliest definitive authority in the area of indefeasibility under the Torrens system, itself involved a question firstly of invalidity in so far as the original proclamation was claimed to be void, as well as the factor of fraud. The appellant company succeeded because of the registration despite invalidity of the original proclamation and in the absence of any fraud being proved. At 189 of the report, Lord Lindley in delivering judgment on behalf of the Privy Council says:

“The company’s title as registered owner is impeached by the plaintiffs in all three cases on two grounds: namely, first, that the registration of the company as owner was procured by fraud; and, secondly, that such registration was invalid by reason of the invalidity of the orders of the Native Land Court on which warrants of the Governor, having the affect of Crown grants, were issued, on which warrants the registration was founded.”

Further on at 200 his Lordship says:

“The question of fraud will be considered later; but apart from fraud the respondents contend that the warrant was invalid because it was founded on an invalid order of freehold tenure; that this order was invalid because it was founded on an invalid memorandum of transfer from the natives; that this was invalid because it was not founded on any memorial of title, but only on an order for a memorial, and that this order was worthless because there was no certified plan before the Court when the order was made.”

The relevance of the Assets case to the present problem is therefore patently obvious. Of course the case from a factual point of view is not on all fours with the present matter and this has allowed the appellants’ counsel some leeway in his dealing with the present problem. Nevertheless, it seems to me that counsel is inferentially seeking to mount an attack on the principles of law enunciated by the Privy Council in the Assets case.

The end result of all this is that even if I were to find in the appellants favour that the lease was void because of serious irregularities concerning the way in which it was issued prior to registration, such registration, in the absence of fraud, achieves an immediate indefeasible title. I agree with the learned trial judge that “whilst the Court could have been of assistance to the plaintiff prior to the day of registration because of the failure in issuing a lease to observe the provisions earlier referred to under the Land Act, but time had moved on”.

There is one further complicating feature in the case before this Court. Both counsel have conceded that between the time of judgment by the learned trial judge and the hearing before us a further transfer from Delta Developments to another purchaser has been concluded and registered.

I do not think it is necessary to go into the area of public policy concerning the necessity for the existence in our legislation of indefeasibility. They are quite numerous but in essence the various legislatures have determined quite deliberately that assurance of title is essential to a sound land holding and registration system. Unsoundness of title is a major problem throughout Papua New Guinea. Disputes as to title are notoriously at the bottom of many tribal battles and commercial investment difficulties. I am firmly of the view that the development and enunciation of the law in other common law jurisdictions which have similar legislation to our own is most apt to the circumstances of Papua New Guinea and should certainly be followed in the present case. The question of indefeasibility must be resolved against the appellant and is clearly so paramount that the appellant must, in my view, lose the appeal. However, there have been some other matters argued by counsel and I propose to deal briefly with these before I conclude.

It has been argued that ss 33, 36 and 37 of the Constitution can be called in aid to assist the appellants. I do not see how any of these sections can be of such assistance. They are dealing with basic rights and in my view do not have any application to the factual situation before this Court. Furthermore, it is important to bear in mind in this case that no rights as such have been interfered with at all. It is true that a certain interest in the land was held by the appellants but that is not the nature of any legal or equitable interest. It is simply that Mr Mudge expressed a general interest in acquiring the land but has acquired nothing more than that particular general interest.

The final ground of appeal to which I intend to refer is the claim by the appellant that the outcome of the Court’s application of the law in this matter will bring about a result which is harsh and oppressive on the appellants and thus by the Constitution, s 41, any such act, be it done under a valid law or otherwise, is unlawful. Again I am unable to appreciate how the issue of a registered lease which gains indefeasibility under the Land Registration Act, s 33, and thereby ensures the continuance in this jurisdiction of such principle and the paramountcy of the Torrens system generally, can be said to be harsh and oppressive and thereby unlawful when the person making such claim does not even have a legal or equitable interest in the matter. I think the learned trial judge was quite correct when he preferred to restrict this claim to the difficulties which Mr Mudge will face because of the fact that his sewerage drain now runs through someone else’s property. It is undoubtedly unfortunate for Mr Mudge that he is placed in this position, and that he has also lost an opportunity to improve his business enterprise in a manner which he deemed expedient, because of the registration of the adjoining property in someone else’s name. I do not for one instant believe that the drafters of the Constitution had such a type of situation in mind when they set down the prescribed acts mentioned in the Constitution, s 41. There is really no merit in the appellant’s argument based on the Constitution, s 41, for it amounts to no more than a claim that any party dissatisfied with a decision of a Court could claim such a decision is harsh and oppressive simply because it does not give him what he wants. The submission is misconceived. I further believe that his Honour was quite correct in refusing to refer the question to the Supreme Court. Apart from anything else it is purely an ancillary issue.

I would dismiss this appeal with costs. I note that the learned trial judge in his discretion made certain orders as to costs which partly favoured the present appellant. However, I do not believe there has been any reason laid before this Court which would justify us in interfering with the exercise of that discretion. I would uphold not only his Honour’s decision but also his order as to costs.

WOODS J: This is an appeal against a decision of the National Court refusing declarations that officers of the State had acted ultra vires and breached provisions of the Land Act (Ch No 185) in granting a lease to Delta Developments Pty Ltd and refusing to make an order that the State forfeit the lease so granted.

The history of this matter is well set out in the decision of the trial judge. But briefly it appears that the appellants/plaintiffs had appeared interested in a piece of land adjoining their property at Boroko and had been in touch with the relevant authorities to have the land rezoned. The plaintiffs had left matters to take their normal slow course. However in the meantime, unknown to the plaintiffs, Delta Developments Pty Ltd took their own independent action to acquire the land and through brazen persistence moved the State authorities to act expeditiously and were granted a lease of the land. In doing so it is quite clear that certain notice procedures required under the Land Act were not followed and the plaintiffs were not given notice and were denied the opportunity to apply.

Not only was the lease issued from the Department of Lands but it was registered the very next day under the Land Registration Act (Ch No 191) and a registered lease issued from the office of the Registrar of Titles.

Whilst the trial judge agreed that procedures under the Land Act were not followed he found that he was unable to grant the declaratory orders sought by the plaintiffs because Delta had a registered Torrens type lease which is indefeasible subject to certain exemptions under the Land Registration Act. The trial judge said the kind of indefeasibility conferred by a Torrens statute, and the Land Registration Act is one of those statutes, is a very real and important thing and the facts of this case gave him no grounds whatsoever to upset this indefeasibility.

As a preliminary point it should be noted that the first respondent as named cannot be sued as he has no corporate personality. The first respondent, as denoted, is in fact the servant of the State (the second respondent), so in reality this appeal proceeds against the second respondent.

In his submissions before us, counsel for the appellants pressed that because officials of the Department of Lands failed to observe procedures under the Land Act, the lease granted to Delta was granted in excess of power and therefore must be void, and therefore there was nothing that could be registered under the Land Registration Act.

The appellants also submitted that they are entitled to the protection of the Constitution, s 37 and s 41, following the breach by Department of Lands officials of certain provisions of the Land Act.

Whilst one must sympathise with the appellants over the way their already noted interest in the land concerned was almost deliberately overlooked, one must bear in mind when considering whether the Constitution, s 37 and s 41, applies that at no time did the appellants lose anything that they legally owned. They have not been deprived of access to the courts nor were they deprived of anything that they had legally acquired. They had no rights over the land at all. They had merely expressed interest in it. Of course anyone in Papua New Guinea must be given the opportunity to apply for such land unless the Government in accordance with provisions under the Land Act, for good reason, decides to limit its availability. The appellants were just not given the opportunity to apply for the land in proper form. I agree that certain procedures were not followed and perhaps certain officials of the Department may be somehow liable for the negligence or default, and also if the appellants had acted prior to the registration of the lease, perhaps they could have obtained a stay in the procedures until their right to apply was determined.

But once the lease as granted was registered under the Land Registration Act, the indefeasibility of registration under that Act applies.

It should be noted here that the third respondent has a State lease registered under the Land Registration Act, and this really is where the main issue of this appeal must be decided. Does land once registered under the Act thereby attain indefeasibility of title?

With reference to the submission on the position of leases registered under the Land Registration Act with the failure to follow procedures under the Land Act I need only refer to the authority of Frazer v Walker [1967] 1 AC 569 which refers to Assets Co v Mere Roihi [1905] UKLawRpAC 11; [1905] AC 176 and Boyd v Mayor of Wellington [1924] NZGazLawRp 58; [1924] NZLR 1174: “Registration was effective to vest title in a registered proprietor notwithstanding that he acquired his interest under an instrument that was void.” See also Breskvar v Wall (1971) 126 CLR 376.

This is what has been called the Torrens system of land registration and this system and the above authorities have been held to be applicable here. I see no reason why we can change this principle and I consider that ss 37, 38(1) and 39 of the Land Registration Act do not affect this principle. Once it is registered, the title to a State lease is indefeasible. The facts in this case do not bring the case within the limited exemptions listed in s 33.

The appellant argued a number of grounds of appeal but these grounds are either not significant or not relevant or are completely overshadowed by the principle of indefeasibility. These other grounds are not substantial enough to warrant interference with the trial judge’s decision.

I would dismiss the appeal with costs.

Appeal dismissed

Lawyer for the appellants: Donigi Reiner and Co.

Lawyer for the first and second respondents: State Solicitor.

Lawyer for the third respondent: John Gawi and Associates.