New South Wales Court of Appeal CITATION : Davis v Williams [2003] NSWCA 371 HEARING DATE(S) : 25/07/03 JUDGMENT DATE : 16 December 2003 JUDGMENT OF : Hodgson JA at 1; Young CJ in Eq at 52; Gzell J at 224 DECISION : (1) Appeal allowed; (2) Orders made by Davies AJ be set aside; (3) Order that the claim by the opponent as surviving joint tenant to a half share in the half share of the estate of Malcolm Clarence Williams in the property 19 Heyson Avenue, Ermington, NSW, be dismissed; (4) Order that the opponent pay the costs of the claimant and of the second opponent both of the trial before Davies AJ and this appeal; (5) First opponent to have a certificate under the Suitors Fund Act if qualified; (6) Remit the proceedings to the Equity Division for the Family Provision Act application to be heard and determined. CATCHWORDS : REAL PROPERTY- Torrens System- Fraud- Alteration of document by registration clerk- Whether fraud- Whether attributable to registered proprietor. AGENCY- Principle that he who takes benefit of an authorised agent's act is bound- What is meant by "benefit". Family Law Act 1975, s 79 LEGISLATION CITED : Family Provision Act 1982 Local Government Act 1993 Real Property Act 1900, ss 42, 97, 118 Assets Co Ltd v Mere Roihi [1905] AC 176 Australian Guarantee Corporation v De Jager [1984] VR 483 Bahr v Nicolay (No 2) (1988) 164 CLR 604 Bank of South Australia Ltd v Ferguson (1998) 192 CLR 248 Barrow v Bank of New South Wales [1931] VLR 323 Beatty v ANZ Banking Group Ltd [1995] 2 VR 301 Blackburn, Low & Co v Vigors (1887) 12 App Cas 531 BNP Paribas v Pacific Carriers Ltd [2002] NSWCA 379 Bogdanovic v Koteff (1988) 12 NSWLR 472 Boyd v Mayor of Wellington [1924] NZLR 1174 Brickwood v Young (1905) 2 CLR 387 Butler v Fairclough (1917) 23 CLR 78 Colonial Mutual Life Assurance Society Ltd v Producers & Citizens Co-Operative Assurance Co of Australia Ltd (1931) 46 CLR 41 Conlan v Registrar of Titles (2001) 24 WAR 299 Corin v Patton (1990) 169 CLR 540 Cray v Willis (1729) 2 P WMS 529; 24 ER 847 Demetrios v Gikas Dry Cleaning Industries Pty Ltd (1991) 22 NSWLR 561 Dixon v Olmius (1787) 1 Cox 414; 29 ER 1227 Forgeard v Shanahan (1994) 35 NSWLR 206 Frazer v Walker [1967] 1 AC 569 Grgic v Australian & New Zealand Banking Group Ltd (1994) 33 NSWLR 202 Hardy v Lane (1994) 6 BPR 13968 Hedley v National Commercial Banking Corporation of Australia Ltd (C/A, unreported, 31.10.86) Hickey v Powershift Tractors Pty Ltd (1998) 9 BPR 17339 Hollis v Vabu Pty Ltd (2001) 207 CLR 21 Houghton v Immer (No 155) Pty Ltd (1997) 44 NSWLR 46 Huguenin v Baseley (1807) 14 Ves 273; 33 ER 526 Jervis v Berridge (1873) LR 8 Ch App 351 Jessett Properties Ltd v UDC Finance Ltd [1992] 1 NZLR 138 Jones v Dunkel (1959) 101 CLR 298 Kettlewell v Refuge Assurance Co [1908] 1 KB 545 Kooragang Investments Pty Ltd v Richardson & Wrench Ltd [1982] AC 462; [1981] 2 NSWLR 1 Latec Investments Ltd v Hotel Terrigal Pty Ltd (1965) 113 CLR 265 Leigh v Dickeson (1884) 15 QBD 60 R Leslie Ltd v Sheill [1914] 3 KB 607 Lister v Hesley Hall Ltd [2002] 1 AC 215 Lloyd v Grace Smith & Co [1912] AC 716 CASES CITED : Lodge v National Union Investment Co Ltd [1907] 1 Ch 300 McMahon v The Public Curator of Queensland [1952] St R Qd 197 McNab v Earle [1981] 2 NSWLR 673 Macquarie Bank Ltd v Sixty-Fourth Throne Pty Ltd [1998] 3 VR 133 McVey v Denis (1984) 55 ALR 201 Mair v Rio Grande Rubber Estates Ltd [1913] AC 853 Munro v Stuart (1924) 41 SR (NSW) 203 Re Murdoch and Barry (1975) 64 DLR (3d) 222 National Commercial Banking Corporation of Australia Ltd v Hedley (1984) 3 BPR 9477 National Trustees Executors & Agency Co of Australasia Ltd v Boyd (1926) 39 CLR 72 New South Wales v Lepore (2003) 77 ALJR 558 Overton v Banister (1844) 3 Hare 503; 67 ER 479 Pyramid Building Society (In liq) v Scorpion Hotels Pty Ltd (1996) 136 ALR 166 Pyramid Building Society (In liq) v Scorpion Hotels Pty Ltd [1998] 1 VR 188 Refuge Assurance Co Ltd v Kettlewell [1909] AC 243 Russo v Bendigo Bank Ltd [1999] 3 VR 376 Ryan v Dries (2002) 10 BPR 19497 Sansom v Westpac Banking Corp (1996) 7 BPR 14615 Scallan v Registrar General (1988) 12 NSWLR 514 Schultz v Corwill Properties Pty Ltd (1969) 90 WN (Pt 1) (NSW) 529 Scott v Davis (2000) 204 CLR 333 Spark v Meers [1971] 2 NSWLR 1 Stuart v Kingston (1923) 32 CLR 309 Swan v Swan (1820) 8 Price 516; 146 ER 1281 Swift v Jewsbury (1874) LR 9 QB 301 Tanzone Pty Ltd v Westpac Banking Corp (1999) 9 BPR 17287 Tara Shire Council v Garner [2003] 1 Qd R 556 Taylor v Yorkshire Insurance Co Ltd [1913] 2 Ir R 1 Tierney v Halfpenny (1883) 9 VLR (Eq) 152 Unic SA v Quartermain Holdings Pty Ltd [2002] 2 Qd R 660 Vassos v State Bank of South Australia [1993] 2 VR 316 Wright v Gibbons (1949) 78 CLR 313 JA Westaway & Son Pty Ltd v Registrar General (1996) 7 BPR 14773 Westpac Banking Corp v Sansom (1994) 6 BPR 13790 Westpac Banking Corp v Tanzone Pty Ltd (2000) 9 BPR 17521 Wiamiha Sawmilling Co Ltd v Waione Timber Co Ltd [1926] AC 101 Wicks v Bennett (1921) 30 CLR 80 Williams v Hensman (1861) 1 J & H 546; 70 ER 862 Brian Arthur Davis (First Claimant) PARTIES : Sherrill Louise Gisler (Second Claimant) Ivy Gladys Williams (First Opponent) Registrar General (Second Opponent) FILE NUMBER(S) : CA 40515/03 COUNSEL : B W Rayment QC and D Kell (Claimants) T Alexis and K Sainsbury (First Opponent) SOLICITORS : Tzovaras Legal (Claimants) Gells Lawyers (First Opponent) LOWER COURT Supreme Court - Equity Division JURISDICTION : LOWER COURT 3587/02 FILE NUMBER(S) : LOWER COURT Davies AJ JUDICIAL OFFICER : IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40515/03 HODGSON JA YOUNG CJ in EQ GZELL J Tuesday 16 December 2003 BRIAN ARTHUR DAVIS v IVY GLADYS WILLIAMS CATCHWORDS REAL PROPERTY- Torrens System- Fraud- alteration of document by registration clerk- Whether fraud- Whether attributable to registered proprietor. AGENCY- Principle that he who takes benefit of an authorised agent's act is bound- What is meant by "benefit. FACTS Mr and Mrs Williams purchased a house and land together as joint tenants in 1956. The property was owned by the Housing Commission and was to be registered in the Williams' name once payment was completed. In 1969 the couple separated, but never formally divorced. The house was fully paid off in 1987. In 1993 Mr Williams saw a solicitor, who arranged for a signed transfer from the Commission in favour of the Williams as joint tenants. Mrs Williams' whereabouts were unknown and attempts were not made to contact her. The registration was effected by documents that had, without the knowledge of any other parties, been changed by the registration clerk. Did the registration of the transfer effect an indefeasible joint tenancy? HELD per Hodgson JA and Young CJ in Eq (Gzell J dissenting) the registration clerk did not commit statutory fraud within the meaning of the Real Property Act. Even if she did, that fraud would not have been considered as the fraud of the registered proprietor which would make him lose his indefeasibility. The indefeasible title of an executor who becomes registered proprietor if his testator had been fraudulent examined in the light of s 118(1)(d) of the Real Property Act. Examination of the situations where someone makes a false statement in a transfer and that transfer becomes registered as to whether the transfer should be set aside. A very strong distinction is to be made between an application to rectify the Torrens register on the basis of statutory rights given under the Real Property Act on the one hand and situations where a person has a personal equity on the other. In all the circumstances the present was not a case which could be solved simply by applying the Real Property Act but essentially depended upon equitable principles. The appeal should be allowed and the matter returned to the Equity Division. Per Gzell J dissenting : On the facts, the registration clerk was guilty of statutory fraud and that fraud was brought home to the solicitor who was the agent of the registered proprietor and thus to the registered proprietor. However, because of the unsatisfactory way in which the issues of equitable rights were dealt with below, the matter should be remitted to the Equity Division for reconsideration. ORDERS (1) Appeal allowed. (2) Orders made by Davies AJ be set aside. (3) Order that the claim by the opponent as surviving joint tenant to a half share in the half share of the estate of Malcolm Clarence Williams in the property 19 Heyson Avenue, Ermington, NSW, be dismissed. (4) Order that the opponent pay the costs of the claimant and of the second opponent both of the trial before Davies AJ and this appeal. (5) First opponent to have a certificate under the Suitors Fund Act if qualified. (6) Remit the proceedings to the Equity Division for the Family Provision Act application to be heard and determined. IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL 40515/03 HODGSON JA YOUNG CJ in EQ GZELL J Tuesday 16 December 2003 BRIAN ARTHUR DAVIS v IVY GLADYS WILLIAMS Judgment 1 HODGSON JA: On 10 June 2003, Davies AJ made orders in proceedings brought by Ivy Gladys Williams (the first opponent) against Brian Arthur Davis (the first claimant), the Registrar-General (the second opponent) and Sherrill Louise Gisler (the second claimant), in which Mr. Davis had put on a cross-claim against Mrs. Williams. 2 Mrs. Williams is the widow of the late Malcolm Clarence Williams, and Mr. Davis is the executor of his estate. Mrs. Gisler is the daughter of Mr. and Mrs. Williams and a beneficiary of Mr. Williams' estate. 3 At the time of his death, Mr. Williams was registered as proprietor of a half interest as tenant in common in the property 19 Heyson Avenue, Erminigton, NSW (Ermington property) and Mrs. Williams was registered as proprietor of the other one half interest. In her proceedings, Mrs. Williams alleged in substance that she and Mr. Williams should have been registered as proprietors of the property as joint tenants, and that she was entitled to the entire interest in the property by survivorship. In the alternative, she sought orders under the Family Provision Act for provision out of Mr. Williams' estate. 4 In the cross-claim, Mr. Davis claimed that Mrs. Williams was a constructive trustee in relation to her interest in the property for Mr. Davis as executor of Mr. Williams' estate by reason of Mr. Williams' expenditure on the property, and alternatively that Mrs. Williams' interest in the property was subject to an equitable lien in favour of the estate. An order was made in the proceedings that Mrs. Williams' Family Provision Act application be heard separately and after the remainder of the proceedings; and the decision of Davies AJ was in relation to that remainder of the proceedings. 5 The orders made on 10 June 2003 were to the following effect: (1) a declaration that Mrs. Williams was entitled to be registered as proprietor of the whole of the Ermington property; (2) an order that the Registrar-General rectify the register so that Mrs. Williams be so registered; (3) an order that Mr. Davis deliver to Mrs. Williams the title document and the keys to this property; (4) Cross-claim dismissed; and (5) Mr. Davis to pay Mrs. Williams' costs of the proceedings. 6 Mr. Davis and Mrs. Gisler applied for leave to appeal from those orders. The application for leave was heard on the basis that, if leave was granted, the appeal would be decided without further argument. At the conclusion of argument, leave was granted and the decision of the appeal was reserved. 7 The grounds of appeal relied on by Mr. Davis and Mrs. Gisler are as follows: 1. That his Honour erred in attributing to the late Mr Williams (the deceased) any act of fraud practised by Ms Moore and ought to have held that, within the meaning of s42 of the Real Property Act the present was not a "case of fraud". 2. That his Honour erred in failing to hold that the acts and omissions of Ms Moore were not those of an agent of the deceased. 3. That his Honour erred in holding that the acts or omissions of Ms Moore amounted to fraud within the meaning of s42 of the Real Property Act. 4. That his Honour erred in failing to hold that s97 of the Real Property Act in its present form was not in force in 1994. 5. That his Honour erred in holding that the First Respondent had a personal entitlement to have the transfer from the New South Wales Land and Housing Corporation rectified to reflect the agreement between the Corporation on the one hand and Mr and Mrs Williams on the other. 6. This his Honour erred in failing to hold that any such equity for rectification could not be asserted so as to overcome the effect of a right on the part of the deceased to sever the joint tenancy, and the indefeasibility of the title of the deceased. 7. That his Honour erred in failing to hold that in expending moneys upon the property after 1969, whether by way of payment of instalments of the purchase money or by way of improvements to the property, the deceased did not intend to make a gift to the first respondent. 8. That his Honour erred in failing to hold that any presumption of advancement in respect of such expenditure was rebutted. 8 By the Notice of Appeal, they seek the following orders: 1. Appeal allowed with costs. 2. In lieu of the orders made by Davies J dismiss the Plaintiff's proceedings with costs, in so far as they relate to the rectification of the register. 3. Declare that the First named Appellant as the legal personal representative of the late Mr Williams is entitled to a lien upon the interest of the first respondent in the property the subject of folio identifier 100/36566 for such sum as amounts to one half of the instalments of purchase money and amounts paid by way of improvement to the property after the year 1969, such sum to be certified by the Master or otherwise as the court may direct. 4. In the alternative to 3, a declaration that the First Respondent holds her interest in the property, the subject of Folio Identifier 100/36566 on constructive trust for the First named Appellant as the legal personal representative of the late Mr Williams as to such share as the Court might determine. 5. Order that the First Respondent pay the costs of the Appellants of the proceedings at first instance on such basis as to the court seems fit. 9 Mrs. Williams has put on a Notice of Contention, relying on the following ground: 1. Transfer U313855 should be rectified in equity by reason of unconscionable circumstances of its execution and/or alteration and the deceased's reliance upon registration of the Transfer, in its altered form. 10 The facts and circumstances of this case are set out in the judgment of Young CJ in Eq., pars.[57] to [69]. BASIS OF CLAIMS AT FIRST INSTANCE 11 Since Mr. Davis is registered proprietor of a half interest in the land, the Real Property Act 1900 limits the basis on which Mrs. Williams could claim entitlement to that interest. Relevantly in the circumstances of this case, Mrs. Williams must either show fraud within s.42 of that Act by Mr. Williams or his agent, or else a right in personam enforceable against Mr. Williams. In either case, I think the claim would be enforceable against Mr. Davis. Rights in personam created by a person can generally be enforced against that person's legal personal representative; and as regards fraud, s.118(1)(d) of the Real Property Act provides: 118(1) Proceedings for the possession or recovery of land do not lie against the registered proprietor of the land, except as follows: … (d) proceedings brought by a person deprived of land by fraud against: (i) a person who has been registered as proprietor of the land through fraud, or (ii) a person deriving (otherwise than as a transferee bona fide for valuable consideration) from or through a person registered as proprietor of the land through fraud, 12 If fraud were established, then Mrs. Williams' remedy would be to have the register rectified, if the fraud caused the registered transaction to be void ab initio; or an equitable claim to have the land ordered to be transferred to her, if the fraud did not cause the registered transaction to be void, but caused it merely to be voidable. 13 The Statement of Claim in this case did not in terms make any equitable claim either on the basis of a voidable transaction or on the basis of a right in personam or personal equity. However, written submissions to the primary judge put the case on the basis of rectification pursuant to a personal equity, as well as on fraud. The defendants' written submissions to the primary judge were to the effect that no recognisable cause of action was made out supporting the alleged personal equity. 14 The primary judge found that fraud had been committed by the registration clerk, and that this was fraud for which Mr. Williams was answerable; and also that Mrs. Williams had a personal entitlement to have the transfer from the Housing Corporation rectified to reflect the agreement between the parties, and to have the register rectified to reflect the proper position. This decision could be regarded as based on the following three steps: first, that fraud caused the transfer as registered to be void and that the registration of the transfer should be deleted; second, that, in the events that had happened, the resulting registered proprietor, the Housing Corporation, was a bare trustee for Mrs. Williams as surviving joint tenant; and third, there should be a vesting order having the effect that the trust property vest in the beneficiary. Viewed in that way, the relief granted need not be considered as based on an equitable claim pursuant to a personal equity. 15 As regards Mr. Davis' cross-claim, the primary judge proceeded on a concession by his solicitor that it was based on rejection of Mrs. Williams' claim, and accordingly did not arise in circumstances where he had found in favour of Mrs. Williams' claim. However he expressed the view that the presumption of advancement precluded any conclusion that there was a "constructive" (meaning I think "resulting") trust. He did not expressly refer to the claim for an equitable lien. ISSUES ON APPEAL 16 In my opinion, the issues raised on this appeal can best be considered under four questions: (1) Was there fraud by the registration clerk within the meaning of s.42 of the Real Property Act? (2) If so, was this fraud for which Mr. Williams was answerable? (3) Does Mrs. Williams have a right to equitable relief? (4) Does Mr. Davis have a claim for a constructive trust or equitable lien? FRAUD BY THE REGISTRATION CLERK? 17 As noted by Young CJ in Eq., the case of Munro v. Stuart (1924) 41 SR(NSW) 203 is authority for the proposition that fraud by a registered proprietor against a party other than that seeking to assert an interest against the registered proprietor does not bring the case within the fraud exception to s.42 of the Real Property Act. 18 However, there is a subsequent line of authority to the effect that, if a registered proprietor has obtained registration by a fraud practised on the Registrar-General, that will be fraud for the purposes of s.42 which may be sufficient to deprive the registered proprietor of the advantage of registration: see Australian Guarantee Corporation Ltd. v. De Jager [1984] VR 483, National Commercial Banking Corporation of Australia Ltd. v. Hedley (1984) 3 BPR 9477, Grgic v. Australian & New Zealand Banking Group Ltd. (1994) 33 NSWLR 202, Westpac Banking Corporation v. Sansom (1994) 6 BPR 13790, Sansom v. Westpac Banking Corporation (1996) 7 BPR 14615. 19 In Hedley, I held that there was fraud by a bank where an acting manager had falsely certified that a mortgage was signed in his presence by a mortgagor, knowing that this mortgage was to be submitted to the Registrar-General for registration. No question was raised by the bank in that case as to whether the acting manager knew of the significance of his attestation in the process of registration. However, in circumstances where the acting manager did not give evidence and a Jones v. Dunkel (1959) 101 CLR 298 inference against the bank was available, an inference that the acting manager knew that the Registrar-General would be induced to act by this misrepresentation could readily have been drawn. An appeal to the Court of Appeal in that case was allowed on another point (Hedley v. National Commercial Banking Corporation of Australia Ltd., Court of Appeal, unreported, 31/10/86), and my decision on this point was acknowledged without comment. I remain of the view that, in the circumstances of that case, my decision was correct. 20 As mentioned by Young CJ in Eq., there is also authority that false certification of this kind will not necessarily amount to fraud. In Russo v. Bendigo Bank Ltd. [1999] 3 VR 376, false attestation of a signature on a mortgage as having been signed in her presence made by a clerk employed by a solicitor acting for a bank was held not to be fraud by the bank. However, in that case, the clerk gave evidence, and the Court held that it was not shown that she knew the significance of her attestation in the process of registration or even that the mortgage was to be submitted for registration. The Court also said that it was not shown that the clerk's attestation had the element of dishonesty or moral turpitude required for fraud. 21 Mr. Rayment QC, for Mr. Davis and Mrs. Gisler, submitted that, having regard to the decision in Russo, the primary judge was in error in finding that the registration clerk in this case committed fraud. The relevant findings are at pars.[31], [36] and [37] of the primary judge's judgment: 31 There was fraud in the sense I have discussed committed by Ms Moore. She altered the transfer from the Corporation to Mr and Mrs Williams, after the transfer had been executed, by crossing out the words "as joint tenants" and inserting the words "tenants in common in equal shares". She knew that this did not represent the transaction between the Corporation and Mr and Mrs Williams and she expected the Registrar-General to act upon the alteration, as in fact occurred. She took that course for the purpose of saving a small amount of stamp duty. Nevertheless, she deliberately altered the transfer with the intention that the Registrar-General would act upon her alteration. Her conduct amounted to fraud for the purposes of the Act. … 36 Ms Moore was a registration clerk. She was employed through Ms Pinter to act on Mr Williams' behalf in the stamping and lodgement of the transfer from the Corporation to Mr and Mrs Williams. The fraud which she committed was not authorised, but it was fraud committed in the course of and for the purposes of the transaction which Ms Moore was employed to do. Her fraud was fraud for which Mr Williams was responsible, it having been carried out by his agent in the course of her employment and, if it were necessary to add, for his benefit. 37 Although Ms Moore's actions of themselves were not expressed to be the basis of the claim made in the Statement of Claim, her actions were proved by the evidence before the Court. Mr Williams' responsibility for her actions was debated in the addresses of both Mr Alexis and Mr Marler. In the circumstances, the plaintiff is entitled to rely upon the acts of Ms Moore acting as agent for Mr Williams. 22 The registration clerk did not give evidence in the case, and apart from the fact of the alterations themselves made by her to the transfer from the Housing Corporation, the only direct evidence of her state of mind was the note set out in par.[68] of Young CJ in Eq.'s judgment. Fraud by the registration clerk was not alleged in the Statement of Claim, and no amendment to allege fraud by her was sought. 23 Mr. Alexis, for Mrs. Williams, submitted to us that it was not until two days before the commencement of the hearing, when a draft of the affidavit of the solicitor acting for Mr. Williams was served on them, that Mrs. Williams' advisers knew of the role played by the registration clerk; and accordingly, the case was permitted by the primary judge to be run on the basis that there was fraud by the registration clerk. This history was not disputed by Mr. Rayment. It means I think that the fact that fraud by the registration clerk was not pleaded did not of itself preclude the finding made by the primary judge; but in my opinion these circumstances mean that any Jones v. Dunkel submission arising from her not giving evidence has far less weight than if fraud by her had been alleged in the Statement of Claim, or even by an amendment formally made to the Statement of Claim. 24 In my opinion, in these circumstances it was incumbent on the primary judge to consider carefully whether all elements of fraud had been made out against the registration clerk, or whether, as in Russo, the proof of fraud fell short. The relevant discussion in par.[31] of the judgment does not in terms address the question whether the registration clerk really had it in mind to mislead the Registrar-General in a material respect and thereby influence the Registrar-General to do something materially different from what otherwise would have been done; or whether her behaviour had the element of dishonesty or moral turpitude sometimes said to be necessary for fraud. In my opinion, at least the first of these questions needed to be addressed; and this lack of reasons, together with the circumstance that the registration clerk did not give evidence, so that her mental state has to be a matter of inference from facts which are substantially undisputed, makes it appropriate for this Court to consider for itself whether an inference of fraud should be drawn. 25 In my opinion, it can and should plainly be inferred that the registration clerk knew that the transfer was being submitted for registration to the Registrar-General, and that the alteration she made would cause the Registrar-General to make entries in the register that reflected the altered form of the transfer and not its original form. In my opinion, it could possibly also be inferred that the registration clerk knew that the Registrar-General would do this because the submission of the transfer would represent to the Registrar-General that the transfer as altered was in fact the transfer as signed and certified by the parties, and the Registrar-General would act because he would be induced to accept this false proposition; although this inference is less clear than the first one. However, even this of itself may not be sufficient to establish fraud. In circumstances where the effect of the altered document was understood by the registration clerk to be identical with the effect of two documents which she had for registration, there would be a real question whether she appreciated that to represent to the Registrar-General that this result was effected by one document rather than by the two was a material misrepresentation, which was such as to influence the Registrar-General to act in a way materially different from what otherwise would have been done, rather than being a mere formality. 26 There may also be a further question, namely whether her conduct had that element of dishonesty or moral turpitude that is said to be necessary: Butler v. Fairclough (1917) 23 CLR 78 at 91, 97; Wicks v. Bennett (1921) 30 CLR 80 at 91; Stuart v. Kingston (1923) 32 CLR 309 at 329; Latec Investments Ltd. v. Hotel Terrigal Pty. Ltd. (1965) 113 CLR 265 at 273-4; Bahr v. Nicolay (No.2) (1988) 164 CLR 604 at 614. For my part, however, I do not see that as being, in this case, a requirement distinct from those I have already raised. If the registration clerk made a representation to the Registrar-General, knowing it to be false in a material respect, and intending that the Registrar-General be induced by the representation to act in a way materially different from what otherwise would have been done, then I think that would be sufficient dishonesty or moral turpitude, irrespective of whether she had any intention that anyone be disadvantaged by this. If a lie is material in respects such as these and understood to be so, I do not think that lack of intent to harm can justify treating it as a "white lie" and as excluding dishonesty or moral turpitude. 27 Should it then be inferred that the registration clerk appreciated (1) that the Registrar-General would make entries reflecting the altered form of the transfer because induced to have a false belief that the altered transfer was the transfer as signed and certified by the parties, (2) that the misrepresentation that this was so was material (where the same effect would have been achieved by the two documents) and (3) that this action by the Registrar-General was materially different from what would have been done if the two documents had been submitted? I would draw inference (1); but in circumstances where the registration clerk did not give evidence for the reasons referred to above, and where the only plausible motives for what she did was concern for efficiency and possibly some small saving for Mr. Williams in respect of government charges, I would not draw inferences (2) and (3). Appreciation of (2) and (3) would mean that the registration clerk appreciated that what she did was truly dishonest and not merely a convenient fiction of no consequence; and I am not prepared to infer that she appreciated this. In the absence of appreciation of (2) and (3), I do not think her conduct amounted to fraud. 28 In my opinion therefore, the primary judge was in error in finding fraud by the registration clerk. FRAUD AFFECTING REGISTERED PROPRIETOR? 29 The primary judge did not find the solicitor guilty of fraud, and there is no Notice of Contention alleging that he should have. So the only question arising under this heading is, if I am wrong concerning the registration clerk and if the registration clerk was in fact guilty of fraud, would this fraud affect the title of the registered proprietor. The primary judge found that it did, because it was caused by the registration clerk as the registered proprietor's agent, in the course of her employment as such and for his benefit. 30 Because of my view concerning fraud, this question does not have to be decided. However, I think it is appropriate to express my views on it. 31 It was submitted for Mrs. Williams that the primary judge was correct in this matter. Mr. Alexis submitted that the fraud was within the scope of the registration clerk's authority, and in addition the registered proprietor took the benefit of it and thereby in substance ratified it. 32 Questions concerning the authority of agents arise in various circumstances. One area concerns an agent's authority to make a contract binding on the principal. Another concerns the vicarious liability of employers for wrongful acts committed by their employees. And another concerns a vicarious liability of persons for wrongful acts committed by other persons who are not their employees. This case seems to fall within the last area: the wrongful act was committed, not by an employee of the registered proprietor but by a contractor engaged by his solicitor. (I think the case of BNP Paribas v. Pacific Carriers Ltd. [2002] NSWCA 379, relied on by Mr. Rayment, has little application to the present case, because it concerned questions other than the liability of a principal for the torts of an agent.) 33 In the case of employees, the test in relation to acts not authorised by the employer has been stated as being whether the wrongful act was so connected with the job the employee was employed to do that it can fairly be regarded as an unauthorised mode of doing that job; or whether the connection between the employee's duties and the wrongful act is sufficiently close to regard the wrongful act as within the scope of the employment: see Lloyd v. Grace Smith & Co. [1912] AC 716; Kooragang Investments Pty. Ltd. v. Richardson & Wrench Ltd. [1981] 2 NSWLR 1; and Lister v. Hesley Hall Ltd. [2002] 1 AC 215 and cases there cited. 34 In the case of alleged agents who are not employees, it appears that a person may be liable as principal on a similar basis to an employer, if the wrong-doer was carrying out some activity as the principal's authorised representative in dealing with a third party: see Colonial Mutual Life Assurance Society Ltd. v. Producers & Citizens Co-Operative Assurance Co. of Australia Ltd. (1931) 46 CLR 41 at 48-50 (CML), and cf. Hollis v. Vabu Pty. Ltd. (2001) 207 CLR 21 at 58-60. A person may also be liable as principal where the wrong-doer is carrying out a task that the principal has undertaken to do, at least where the wrong-doing is merely negligent: see Scott v. Davis (2000) 204 CLR 333 at 342-3 per Gleeson CJ, and at 357 in the dissenting judgment of McHugh J. If a person commits an unauthorised wrong-doing while acting as the authorised representative of another in dealing with a third party, then it seems that much the same question would arise as in the case of an employee, namely whether the connection between the wrong-doing and the authorised acts is sufficiently close to regard the wrongful act as being within the scope of the engagement. In both cases, the question whether the wrong-doing was for the benefit of the wrong-doer or the alleged principal will be a relevant, but not on its own conclusive, factor. 35 In the present case, the registration clerk was engaged by the solicitor to deal with the Registrar-General in relation to the transfers. Her task did not include making alterations to either of the transfers. But what she did was quite closely connected with her task and with the result she was engaged to achieve, and it was not for her own benefit, but apparently for the sake of efficiency or a small saving to Mr. Williams. I think that, if what the registration clerk did had given rise to liability of the clerk in tort, then the solicitor would also have been vicariously liable in tort. 36 The solicitor had been engaged by Mr. Williams inter alia to deal with the Registrar-General; but I do not think the solicitor, if acting outside the solicitor's very broad actual (express and implied) and ostensible authority, would be regarded as the client's authorised representative, at least as that expression is used in CML. I think that expression is used in CML so as to suggest the representative represents the principal in the same general sort of way as an employee might do, thereby justifying assimilation of the case to that of an employer and employee: cf. Hollis at pp.54-60, per McHugh J. I do not think Mr. Williams would have been liable in tort for what the registration clerk did, if that had amounted to a tort. This accords with the view of Street J in Schultz v. Corwill Properties Pty. Ltd. (1969) 90 WN(Pt.1)(NSW) 529; although in that case, the solicitor's fraud was for his own benefit, not for that of the client. 37 This does not necessarily mean that Mr. Williams would not have been answerable for the fraud (assuming the registration clerk's act to have been a fraud) for the purposes of s.42 of the Real Property Act. If registration had been obtained by the solicitor's fraud committed for the benefit of Mr. Williams in carrying out the task of obtaining registration, then one would tend to expect that Mr. Williams could not take advantage of the benefit of that registration. However, I think this is not because Mr. Williams would be liable as principal for the solicitor's wrong-doing, but because of a principle that a person cannot take or retain a benefit from a fraud committed on his or her behalf. 38 I accept that there is a principle to that effect, which Young CJ in Eq. has called the Mair principle: see Kettlewell v. Refuge Assurance Co. [1908] 1 KB 545 (appeal dismissed [1909] AC 243), Mair v. Rio Grande Rubber Estates Ltd. [1913] AC 853, note by Handley JA "Exclusion clauses for fraud" (2003) 119 LQR 537. I think this approach was too readily dismissed by Street J in Schultz. 39 However, I think there is a real question in the present case whether Mr. Williams "took the benefit of" the fraud in any substantial sense. For the Mair principle to apply, in my opinion the principal must have a real choice whether or not to take or retain the benefit, and the benefit must be more than trivial. I refer to an analogy from the law of contract. If a person does work altering a house without being requested to do so by the house owner and without the house owner's knowledge (for example, extras performed by a builder that were not obvious to the owner), the house owner will not be taken to have undertaken to pay for that work merely because the house owner has the benefit of the work through ownership and occupation of the altered house. This is because the house owner has no real choice in the matter. In my opinion, much the same approach should be taken in connection with the Mair principle. 40 In this case, in substance the only "benefit" of the fraud to Mr. Williams is that he obtained registration as tenant in common through the registration of one document rather than two, with a relatively trivial saving of government charges. Mr. Williams cannot give up this "benefit" without also giving up what he would have obtained in the absence of fraud, because, for reasons discussed by Young CJ in Eq., the second transfer cannot now be registered. In my opinion, the "benefit" accepted by Mr. Williams is insufficiently substantial, or insufficiently a matter of choice for Mr. Williams, to require that he be considered answerable for the fraud of his agent. According, if I had considered that the registration clerk was guilty of fraud, I would not have found Mr. Williams to be answerable for it. EQUITABLE RELIEF? 41 Had Mrs. Williams made out a case of fraud she could have relied on the transfer as registered being void; and she would then have had a title to the land on the basis that the Housing Corporation was a bare trustee of the property, initially for her and Mr. Williams as joint tenants and, upon the death of Mr. Williams, for her alone as survivor. In those circumstances, I think it would have been appropriate for a vesting order to be made to give effect to the beneficiary's right to the property, without the necessity of Mrs. Williams satisfying other requirements for equitable relief. 42 However, in the absence of making out a case of fraud, Mrs. Williams has to rely on a claim for relief based on some equitable right in personam. She seeks to do so now essentially on the basis that, prior to registration of the transfer, the Housing Corporation was a bare trustee of the property for her and the deceased as joint tenants; and Mr. Williams has, through misrepresentations and negligence of his agents, deprived her of her right of survivorship. The misrepresentations and negligence would include those of the solicitor executing the transfer as solicitor for both transferees, the alterations of the transfer and associated misrepresentations by the registration clerk, and the subsequent inactivity of the solicitor to correct the situation. Although it might be said that the second and third matters on their own did not deprive Mrs. Williams of anything, in the sense that the same result would have been achieved by having the two documents registered rather than just the one, the first deprived her of the chance of participating in what was going on and of the opportunity to make either some application to the Family Court or an application for sale of the property pursuant to s.66G of the Conveyancing Act. 43 Had equitable relief on this basis been squarely sought, then as noted by Young CJ in Eq., the question of doing equity would have arisen. This would have involved among other things a close scrutiny of the substance and reality of any deprivation of opportunity as referred to above, and the matters relied on in the cross-claim would probably have been put forward as matters of defence, as going at least to the question of what was required for Mrs. Williams to do equity. 44 Submissions were made to the primary judge to the effect that the transfer should be rectified on the basis of a personal equity, and this claim is reflected in the Notice of Contention. In my opinion, the case for such rectification was not made out, in circumstances where the issues I have adverted to were not litigated, by reason of the absence from the Statement of Claim of any statement that this kind of personal equity was being relied on. On the material we do have, I agree with Young CJ in Eq. that, even if the issue of a personal equity had been fully explored, probably the best Mrs. Williams could have done was to obtain some modest compensation. That was never sought, and is not sought by the Notice of Contention. 45 In all the circumstances, I agree with Young CJ in Eq. that Mrs. Williams' claim of entitlement to the half interest in the property held by her late husband's estate fails. CROSS-CLAIM 46 Mr. Rayment sought to withdraw the concession made below that the cross-claim was advanced only in the event of rejection of Mrs. Williams' claim. I agree with Young CJ in Eq. that this Court should permit withdrawal of that concession. 47 In my opinion, it is plain that Mr. Davis did not make out a case for a lien. This would require evidence that the amount of outgoings paid by Mr. Williams and the increment to the value of the property caused by improvements exceeded a reasonable allowance for Mr. Williams' sole occupation (cf. Ryan v. Dries (2002) 10 BPR 19497 at [61]), and there was no such evidence. There was some question whether there was a defence to the cross-claim in so far as it alleged a lien. However, the original cross-claim alleged only a constructive trust, and that was denied. The amended cross-claim alleging a lien was put on only during the hearing of the case. In my opinion, it is plain that the case was conducted on the basis that the allegation of lien was not admitted. 48 As regards the claim of resulting trust, I would accept that payment of part of the purchase price by way of payment of instalments under an instalment contract could in some circumstances give rise to a resulting trust: see my decision in Hardy v. Lane (1994) 6 BPR 13,968. However, in the present case the contract was for a purchase in the names of a husband and wife, and the obligation to pay instalments was binding on them jointly and severally (see cl.42 of the agreement with the Housing Corporation dated 27 November 1956). The presumption of advancement would apply to payments made by the husband. There was evidence of disputes and of the separation of the husband and wife; but even if this could be regarded as evidence which might rebut the presumption of advancement, it is also necessary in this case to take into account that, in paying instalments after Mrs. Williams left the property, Mr. Williams was doing no more than paying money which he had a contractual obligation to pay, which he needed to pay if he was not to be ejected from the premises he was occupying (see cls.35-37 of the agreement) and in respect of which (if the presumption of advancement was rebutted) he had a right to claim a fifty percent contribution from his co-purchaser. 49 In those circumstances, I agree with the primary judge that the presumption of advancement was not rebutted; and, even if that presumption were rebutted, in my opinion the appropriate inference from the circumstances is that the payments were made by Mr. Williams on behalf of both purchasers, in circumstances where he could claim contribution from Mrs. Williams. No such claim was made in these proceedings, and such a claim would probably be statute-barred. 50 In these circumstances, in my opinion the primary judge was correct to dismiss the cross-claim. As noted by Young CJ in Eq., there may be occasion to consider payments made in respect of the property, and the value of occupation of the property, in connection with Mrs. Williams' Family Provision Act proceedings; but this would only be as one aspect in assessing the strength of Mrs. Williams' claim and assessing the appropriate quantum of any award that might be made to her. CONCLUSION 51 For these reasons, I agree with the orders proposed by Young CJ in Eq. 52 YOUNG CJ in EQ: This is an application for leave to appeal heard concurrently with the appeal itself in a case involving significant questions as to the operation of the Torrens system. 53 At the conclusion of the oral hearing, the Court granted leave to appeal. Thus, these reasons deal solely with the fate of that appeal. 54 The basal facts are undisputed and I will set them out as they appear in the judgment of Davies AJ. 55 The first opponent, who was the plaintiff below, Ivy Gladys Williams, is the widow of the late Malcolm Clarence Williams. The first claimant, the first defendant below, is the executor of his estate. The second opponent is the Registrar General. In the proceedings below, Ms Sherril Gisler, the parties' younger daughter, was a party and was joined as a claimant, but she played no significant part in the proceedings. 56 For simplicity I will refer to Mr Davis simply as "the claimant" and to Mrs Williams as "the opponent" unless the context otherwise requires. 57 Mr and Mrs Williams were married in 1948. In November 1956, they contracted to purchase a house and land from the Housing Commission of NSW for the price of £3,000 payable by a deposit of £50 and the balance plus interest being payable by monthly instalments of £13.5.0 each. The period over which the instalments were to be paid was 45 years. It was a term of the contract that Mr and Mrs Williams made the purchase as joint tenants. From 1986 the functions of the Housing Commission were vested in the NSW Land and Housing Corporation. 58 After paying the deposit, Mr and Mrs Williams moved into the home, No 19 Heyson Avenue, Ermington, NSW. In about 1969 Mrs Williams moved out of that home and she and her husband thereafter lived entirely apart. Mr Williams remained in the home with the parties' younger daughter Sherril who remained with her father for at least three years. Mrs Williams commenced another relationship, but she and Mr Williams were never formally divorced. 59 The property had been fully paid off in January 1987. In September 1993, Mr Williams consulted a solicitor, Janice Pinter. Ms Pinter wrote to the NSW Land and Housing Corporation which acknowledged that fact, and prepared and executed a transfer of the property into the names of Mr and Mrs Williams as joint tenants. This transfer was sent to Ms Pinter. Although she was only instructed by Mr Williams, Ms Pinter took it upon herself to execute the transfer as "Solicitor for the transferee". 60 Justice Davies said: "No doubt Ms Pinter ought not to have so acted without informing Mrs Williams. Ms Pinter has given evidence that she was informed by Mr Williams that he did not know Mrs Williams' address. However, as there were three children of the marriage including Sherril, it should not have been difficult to obtain the necessary information. Nevertheless, I cannot draw any inference of significant impropriety from the fact that Ms Pinter executed the transfer. It was appropriate that the transfer be effected and lodged for registration, for the property had long since been paid off. The transfer was from the [NSW Land and Housing] Corporation to Mr and Mrs Williams as joint tenants. There was nothing adverse to Mrs Williams' interests in that." 61 Before us, counsel for Mrs Williams, when asked specifically by the bench, disclaimed any reliance on Ms Pinter's acts in accepting the transfer and specifically declined to argue that Ms Pinter's acts and proffering a transfer in that form to the Registrar General could constitute fraud within the meaning of the Real Property Act 1900. 62 Justice Davies continued: "About the time this was occurring, Ms Pinter discussed with Mr Williams the severing of the joint tenancy. Ms Pinter was of the view that Mr Williams, as a joint tenant, could execute a transfer of his half interest in the property to himself and that, on registration of that transfer, the joint tenancy would be severed. In this view, Ms Pinter was correct. See s 97 of the Real Property Act 1900. Sub-section 97(5) empowers the Registrar General to give notice of such a dealing to all joint tenants. "Ms Pinter was instructed by Mr Williams to proceed with the severance of the joint tenancy. She accordingly prepared a transfer of a one half share in the property from Mr Williams to himself, the tenancy to 'tenants in common'. Ms Pinter intended that both transfers would be lodged at the same time, the transfer executed by Mr Williams to follow the transfer executed by the Corporation." 63 His Honour observed that there was no impropriety in that and that it was unnecessary for a joint tenant seeking to sever to notify the other joint tenant, although the Registrar General might give such notice that the transfer had been lodged. 64 Ms Pinter then forwarded the documents to one Vicki Moore who appears to be a lady operating her own business as a registration clerk. She was not an employee of Ms Pinter. She was for all intents and purposes an independent contractor. 65 Ms Pinter instructed Ms Moore to attend the Stamp Duties Office, stamp the transfer re tenants in common, then lodge both transfers at the Land Titles Office. She enclosed a cheque to cover the stamp duty and lodgement fees for the Registrar General. 66 To quote Davies AJ: "Unfortunately, Ms Moore, perhaps after a conversation with some person at the Stamp Duties Office, took it into her head to save duty on the second transfer by altering the transfer from the Corporation to a transfer to Mr and Mrs Williams as tenants in common. She crossed out the words 'as joint tenants' and wrote in the words 'tenants in common in equal shares'. She then lodged the transfer from the Corporation and the certificate of title in the Registrar General's Office. The transfer so altered was in due course registered. The procedures for which s 97 provides were not initiated." 67 In due course, Ms Moore returned Ms Pinter her letter of instructions on which she had written "2nd tsf not required. Changed cheque 100773 to $50". She also returned the transfer from Mr Williams to himself which had not been stamped or lodged for registration. 68 Davies AJ said: "Ms Moore's note indicated to Ms Pinter that the second transfer, the transfer from Mr Williams to himself, was not required. Plainly, as a solicitor, Ms Pinter had a duty to make inquiries. She had sent an executed transfer to Ms Moore for stamping and registration. Registration of that transfer was required to achieve severance of the joint tenancy pursuant to s 97 of the Real Property Act. Her evidence, that, on receipt of Vicki Moore's note, she thought that the procedure at the Registrar General's Office had changed and that 'procedures change all the time' demonstrates a profound ignorance of the practice of the Registrar General's Office and of the provisions of the Real Property Act. Ms Pinter knew that what she had asked Ms Moore to do had not been done but she gave no professional consideration to that circumstance." 69 In October 1994, Ms Pinter, having received details of the registration, advised Mr Williams that he and his wife were now registered as tenants in common. She said she was holding the title deed in her safe and warned him that he was still at risk from his wife obtaining an order under the Family Law Act. 70 His Honour concluded: "Again, Ms Pinter would have realised, if she had turned her mind to the matter, that there could not have been a transfer from the Corporation to Mr and Mr Williams as tenants in common absent some unauthorised dealing. However she did not do so." 71 As to the legal position, his Honour noted that if things had happened according to Ms Pinter's plan, the joint tenancy would have been severed, though probably Mrs Williams would have received notice from the Registrar General which would have given her an opportunity to take some action to stop the severance. 72 It seems to have been common ground before his Honour that s 97 of the Real Property Act was relevant. However, the instant transaction took place in the second half of 1994. Section 97 was only enacted by Act No 95 of 1997 and came into force on 1 January 1998. Accordingly, s 97 has nothing to do with this case at all and the statement made in the previous paragraph is very questionable. 73 His Honour also noted that in the present case he was not concerned with any acts done to defraud Mrs Williams. Mr Williams, Ms Pinter and Ms Moore did not have that in mind. What he was concerned with was fraud in the sense of fraud upon the Registrar General, fraud in the preparation, execution and certification of a document lodged for registration in the Registrar General's office. This statement will need to be carefully examined later in these reasons. 74 His Honour referred to cases including Australian Guarantee Corporation v De Jager [1984] VR 483; National Commercial Banking Corporation of Australia Ltd v Hedley (1994) 3 BPR 9477 and Grgic v Australian & New Zealand Banking Group Ltd (1994) 33 NSWLR 202. 75 His Honour said at paras [30] and [31] of his judgment: "The Statement of Claim and much of the address of Mr Alexis [counsel for the plaintiff] concentrated on fault on the part of Ms Pinter. I do not think her actions prior to the registration of the transfer can be categorized as fraudulent. Her conduct was grossly negligent but she did not herself act recklessly without caring as to whether or not her actions were correct. She relied upon and trusted her registration clerk. Of course, once she had received back the details of the registration she knew that what had been registered was wrong. Her conduct at that stage had an element of reckless indifference about it. But, in the circumstances of this case, it is her conduct prior to registration which matters. [31] There was fraud in the sense I have discussed committed by Ms Moore … she deliberately altered the transfer with the intention that the Registrar General would act upon her alteration. Her conduct amounted to fraud for the purposes of the Act." 76 His Honour ruled that Mrs Williams had a personal entitlement to have the transfer from the Corporation rectified to reflect the agreement between the parties, that is, between the Land and Housing Corporation and Mr and Mrs Williams, that she had a personal entitlement to have the register rectified to reflect the proper position. 77 There was a cross claim which sought a declaration that there was a constructive trust on Mrs Williams for the benefit of Mr Williams. His Honour dismissed that cross claim. 78 I should note that Mr Williams died in 2002 and it was only after his death that Mrs Williams became aware of what had happened. She claimed the whole of the property as the surviving joint tenant. Mr Williams' executor, Brian Davis, resisted that claim, but as I have noted, his Honour upheld it. 79 The claimant says that his Honour erred in attributing to the late Mr Williams any act of fraud practised by Ms Moore, so that the present was not a case of fraud. In any event, his Honour was in error in finding that Ms Moore committed fraud in the appropriate sense and that his Honour was in error in commixing the concepts of rectification of a contract, an equitable right, with rectification of the Torrens register. I have summarised the grounds of the appeal, I believe succinctly and correctly. 80 On the appeal Mr Brian Rayment QC and Mr David Kell appeared for the claimant, Mr Todd Alexis and Ms Katherine Sainsbury appeared for the opponent. 81 Mr Rayment put that there were two basic questions for us: (A) was there fraud, and if there was, was it by an agent of the registered proprietor; and (B) what he called the Frazer v Walker point. 82 However there are other matters which we need to consider as well. In my view it is most logical to consider the issues that arise in this case under the following headings: (1) A general consideration of the concept of fraud relevant to this case; (2) A consideration of how fraud by an agent affects a registered proprietor; (3) On the facts of this case, was the act of a registration clerk in altering a document: (a) within her authority; or (b) did such act constitute fraud? (4) Can it fairly be said that the registered proprietor obtained a benefit from the actions of Ms Moore? (5) If the answer to (3) is "Yes", was the Judge correct to find that it was a fraud against the Registrar General? (6) How was it possible in 1993 to sever a joint tenancy? (7) Is a claim to rectify the Torrens Register a claim at law or in equity? (8) What, if anything, is the significance of Mr Davis now being the registered proprietor of the subject land? (9) Was there any personal equity in Mrs Williams? (10) What is the significance of the failure to plead any personal equity? (11) What counter equities could be asserted by Mr William's estate? (12) What offer to do equity ought to be required? (13) May the Registrar General register an instrument after the death of a signatory to it? (14) Should Mrs William's personal equity claim be upheld? (15) Was the Judge's ruling dismissing the cross claim appropriate? (16) Should the claimant be permitted to withdraw his concession on the cross claim? (17) What is the result of the appeal? 83 (1) The word "fraud" occurs in two different contexts in these reasons and it is imperative that at the start, I clearly differentiate between the two usages of the term. First, the word is used in the maxim that "No person can take advantage of the fraud of his agent" (per Lord Moulton in Mair v Rio Grande Rubber Estates Ltd [1913] AC 853, 872-3); a principle which I will call the "Mair Principle". Secondly, it is used in the Real Property Act as one of the impediments to a person securing an indefeasible title. This use of the word is best denoted by the term "Statutory Fraud". 84 So far as the Mair Principle is concerned, the word "fraud" is used in the sense of common law fraud. 85 On the other hand, as Hinde, McMorland & Sim point out in their Butterworths Land Law in New Zealand (Butterworths, Wellington, 1997) p 141 (cited herein as "Hinde"), statutory fraud "is (1) Wider than the common law concept of fraud because it is not confined to deceit or fraudulent misrepresentation; and (2) Narrower than equitable fraud because dishonesty in the sense of moral turpitude is an essential element" and it must be "brought home to the registered proprietor or to the registered proprietor's agent". 86 It is clear that statutory fraud is actual fraud, not constructive or equitable fraud and that actual fraud connotes personal dishonesty or moral turpitude, but that this does not mean that all species of equitable fraud stand outside the statutory concept of fraud: Assets Co Ltd v Mere Roihi [1905] AC 176, 210; Bahr v Nicolay (No 2) (1988) 164 CLR 604. As the High Court said in that lastmentioned case at 614, the fraud or dishonesty is "dishonesty on the part of the registered proprietor in securing his registration as proprietor." 87 I should note, unless it be thought I had overlooked the obvious, that we were referred to Boyd v Mayor of Wellington [1924] NZLR 1174 where a five member Court of Appeal in New Zealand held that even assuming that the instrument upon which registration took place was void in the absence of fraud there was still an indefeasible title to the land affected. 88 Section 42 of the Real Property Act reads, so far as is relevant: "the registered proprietor for the time being of any estate or interest in land recorded in a folio of the Register shall, except in case of fraud, hold the same … absolutely free from all other estates and interests that are not so recorded." 89 It is unnecessary to canvass fully all the statements made in the authorities about statutory fraud. However, a couple must be noted. 90 In Munro v Stuart (1924) 41 SR (NSW) 203, 206, Harvey J held that in order for there to be statutory fraud under s 42 the fraud must be fraud against the person who seeks the assistance of the court. 91 In Bank of South Australia Ltd v Ferguson (1998) 192 CLR 248, 256, the High Court said that it must be remembered that: "(i) statutory fraud embraces less, not more, than a species of fraud which, at general law, founds the rescission of a conveyance; and (ii) statutory fraud is not itself directly generative of legal rights and obligations, its role being to qualify the operation of the doctrine of indefeasibility upon what would have been the rights and remedies of the complainant if the land in question were held under unregistered title." 92 Ferguson's case was one where there had been a forgery within a bank "probably designed to speed up the process within the bank" which had had no effect on the mortgagor. The High Court held that the matter of forgery was irrelevant to statutory fraud. This case was followed by Wilson J in the Supreme Court of Queensland in Unic SA v Quartermain Holdings Pty Ltd [2002] 2 Qd R 660. 93 A vital question is whether Ms Moore's action could be classed as statutory fraud. 94 There have been a series of cases in New South Wales and Victoria examining how far a false declaration of personal attestation to a mortgage which is then lodged for registration amounts to statutory fraud. It is useful at this point to examine some of these authorities in some detail. 95 As I have already noted, his Honour considered the leading cases in this area namely Australian Guarantee Corporation v De Jager [1984] VR 483 (a decision of Tadgell J); National Commercial Banking Corporation of Australia Ltd v Hedley (1984) 3 BPR 9477 and Grgic v Australian & New Zealand Banking Group Ltd (1994) 33 NSWLR 202. 96 The first two of this series of cases were decided within six weeks of each other, presumably without the knowledge of the existence of the other. Each considered that in the circumstances of the case that it was a fraud on the Registrar General for a bank officer to state that he had witnessed a signature of a mortgage and that the mortgagor was personally known to him when this was untrue. In each case the officer knew that he was making that representation to the Registrar General so that the relevant document would be registered. 97 In Hedley's case Hodgson J said at 9482: "My view is that this conduct does amount to fraud within the meaning of s 42 and s 43 of the Real Property Act. In my view, certainly, it is fraud in the sense of actual dishonesty and base conduct which had been directed to obtaining registration and has actually resulted in obtaining that registration." 98 These two cases were considered by this Court in Grgic v ANZ Banking Group Ltd (1994) 33 NSWLR 202. In that case, a son had carefully practised signing his father's name for many years and signed his father's name to a mortgage and had it witnessed by a bank officer. However, Powell JA, with whom Meagher and Handley JJA agreed, said at 222 that the fact of the bank officer's "attestation could not, in my view, constitute statutory fraud unless it could be shown, either, that he knew that" the person who signed the mortgage was not in fact the registered proprietor or else "he was acting recklessly without caring whether or not" the mortgage was being signed by the registered proprietor. 99 When one reads Hedley's case one can see that Hodgson J wrestled with the problem as to whether fraud in ss 42 and 43 of the Real Property Act must actually be directed against the person who is claiming the unregistered interest or may be fraud against the Registrar General. His Honour said at page 9481 that the bank officer's conduct amounted to actual dishonesty within the cases on statutory fraud. However, he then said: "I note that that dishonesty was not … directed specifically to dishonesty in depriving Mrs Hedley of her interest in the property." 100 Without having the benefit of any authority which he considered might guide him, his Honour opted for the result that the bank was denied indefeasibility for statutory fraud. 101 In Westpac Banking Corp v Sansom (1994) 6 BPR 13790 at 13796, Rolfe J reviewed the authorities and said: "These authorities establish there is fraud, within the meaning of s 42, when a representation is made, contrary to the fact, that a person is personally known to the attesting witness and has signed the document in his/her presence. The purpose of the requirement that a registrable document should be signed by a person in the presence of another to whom he/she is personally known is, inter alia, to avoid the registration of forged documents." 102 In addition to authorities to which I have already referred, his Honour referred to my decision in Scallan v Registrar General (1988) 12 NSWLR 514, 519 and the decision of this Court in Demetrios v Gikas Dry Cleaning Industries Pty Ltd (1991) 22 NSWLR 561. The former of those two cases does not assist: the latter was one where the Court of Appeal decided that the solicitor knew that by tendering mortgages to the vendor's solicitor carrying a false representation that he had witnessed the relevant signature, that the vendor may suffer loss. 103 Sansom's case was affirmed on appeal; see Sansom v Westpac Banking Corp (1996) 7 BPR 14615. 104 Mr Rayment referred us to the decision of the Victorian Court of Appeal in Russo v Bendigo Bank Ltd [1999] 3 VR 376. In that case, a bank registered a mortgage of real estate from Mrs Russo to secure a loan to a company controlled by her daughter and son-in-law. Mrs Russo's signature on the mortgage had been forged by her son-in-law. Miss Gerada, an employee of the bank's solicitor, signed the attestation clause that she had witnessed the mortgagor's signature. Miss Gerada was unaware of the forgery. 105 The court found that Miss Gerada was not guilty of fraud within the meaning of the Torrens Act, even though her attestation of the mortgagor's signature was false because there was no dishonesty or moral turpitude on her part; there was no wilful and conscious disregard and violation of the rights of other persons, and this was so even if her attestation was dishonest. 106 Mr Alexis submitted that the reasoning of Russo's case was odd, seemingly involving a finding that a person who knew what she said was false was nonetheless not dishonest. He also submitted that the result was bizarre. I took these submissions into account, but I also note that Russo's case was followed by Owen J in Conlan v Registrar of Titles (2001) 24 WAR 299, 345. 107 Mr Rayment also referred to Tanzone Pty Ltd v Westpac Banking Corp (1999) 9 BPR 17287 (reversed, but not on this point as Westpac Banking Corp v Tanzone Pty Ltd (2000) 9 BPR 17521) where Windeyer J held that there was no fraud under the Torrens system where a person acted with notice that another had a mere equity being a right of rectification, yet acted to defeat that right. 108 Bryson J in Hickey v Powershift Tractors Pty Ltd (1998) 9 BPR 17339 at 17344 considered that proffering a mortgage with knowledge of an untrue attestation was fraud and seems to suggest that fraud against the Registrar General is sufficient. 109 Apart from the cases I have already mentioned, there is Vassos v State Bank of South Australia [1993] 2 VR 316; Beatty v ANZ Banking Group Ltd [1995] 2 VR 301 and Pyramid Building Society (in liq) v Scorpion Hotels Pty Ltd (1996) 136 ALR 166 (Nathan J) reversed [1998] 1 VR 188 by the Victorian Full Court. Although these cases discuss the various principles they really do not take the matter any further. 110 Even though anyone who attests a dealing under the Torrens system falsely is in one sense committing fraud against the Registrar General, the cases show that that is not enough. It will be enough if an officer of the interested party which has become registered knowingly or recklessly certifies so that the registration is effected (De Jager, Hedley, Sansom). It will not be enough if some officer of the person who obtains registration without any moral turpitude or intention of depriving a person of an interest in land makes a false attestation (Russo). In all cases it must be shown that there was fraud by the person becoming registered or its agent in obtaining registration so that an interest which would otherwise take priority over that interest has been defeated. 111 In the present case, Ms Moore never intended that her action would deprive any person of any interest in the land. The whole of the evidence shows that she took what she wrongly thought was a permissible short cut to achieving the task that Ms Pinter had set. 112 However, Mr Alexis contends that Ms Moore was an experienced registration clerk, she must be taken to know that one does not alter documents without authority and that proffering the documents to the Registrar General to secure registration was wrong. He says that this is sufficient to show dishonesty within the meaning of that term as used in the concept of statutory fraud. 113 In my view, cases such as Russo tell against that view, even though the flavour of it did come to the fore in cases such as Hedley. Ms Moore's conduct might even be regarded as stupid. However, I cannot see any element of moral turpitude in it. 114 Thus, I do not consider that the element of statutory fraud was made out in this case. 115 (2) It is trite law that statutory fraud is only operative if committed by the registered proprietor or his or her agent: Assets Company Limited v Mere Roihi [1905] AC 176, 210. 116 Such authorities as there are which directly consider the acts of agents on Torrens system dealings say that even constructive notice of the fraudulent acts of others and taking advantage of them does not constitute statutory fraud: Macquarie Bank Ltd v Sixty-Fourth Throne Pty Ltd [1998] 3 VR 133, 146, 152; Tara Shire Council v Garner [2003] 1 Qd R 556, 568. 117 Halsbury LC in Blackburn, Low & Co v Vigors (1887) 12 App Cas 531, 537-8 contrasted the position of agents who "so far represent the principal that in all respects their acts and intentions and their knowledge may truly be said to be the acts, intentions, and knowledge of the principal" and other agents with a more limited and narrow authority. The former type are often called "agents to know"; see eg Taylor v Yorkshire Insurance Co Ltd [1913] 2 Ir R 1. 118 In Jessett Properties Ltd v UDC Finance Ltd [1992] 1 NZLR 138, 143, M Hardie Boys J giving the judgment of the Court of Appeal consisting of Cooke P, Richardson J and himself applied this passage to the case of whose fraudulent activities will be accounted as fraud on the part of a registered proprietor. 119 Can it be said that Ms Moore was an agent to know of Mr Williams? 120 Mr Rayment relied on a series of cases, one of the principal authorities being Kooragang Investments Pty Ltd v Richardson & Wrench Ltd [1982] AC 462 for the proposition that Ms Moore should not be regarded as the registered proprietor's agent in this matter at all. 121 In the Kooragang case, an employed valuer carried out valuations for a group of companies of which he was a director using his employer's letterhead but without its authority. The company to whom the valuations had been given passed them on to prospective purchasers who made a loss and sued the employer. The Privy Council said that the case was one of actual authority or nothing. The Privy Council held, affirming the decision of Rogers J in this Court that the valuer had no authority to make the valuations and it was insufficient that the act which the valuer did was of a class which the employer could have entrusted to the agent to do in the course of the agent's ordinary tasks. 122 As Lord Nicholls said in Dubai Aluminium Co Ltd v Salaam [2002] 3 WLR 1913, 1922, in the Koorang case, "Lord Wilberforce … rejected the broad proposition that so long as the employee is doing acts of the same kind as those it is within his authority to do, the employer is liable and he is not entitled to show the employee has no authority to do them." 123 Mr Rayment said that the present position is a fortiori. 124 Mr Rayment also refers to the decision of this Court in BNP Paribas v Pacific Carriers Ltd [2002] NSWCA 379. That appeal concerned two letters of indemnity (LOI) executed by New England Agricultural Traders Pty Ltd (NEAT) and signed by an employee of NEAT's banker, Ms Dhiri. Sheller JA, who gave the decision with which Handley and Giles JJA agreed, said at [85]: "It follows that the only evidence of any representation by [the appellant to the respondent] has to be found in Ms Dhiri's signature on the NEAT LOIs. In other words the argument has to be that Ms Dhiri by herself signing the document represented that she had authority to and did bind BNP to a contract to indemnify. There was no evidence that BNP knowingly permitted Ms Dhiri alone to enter into such contracts on its behalf … There was no evidence that PCL or its officers had any belief one way or another about who had executed the document on behalf of BNP or what the authority of that person was beyond what appeared on the document itself … . [88] The most that can be said was that BNP permitted Ms Dhiri to put her signature on the NEAT LOIs in the place reserved for the Banker's signature for the purpose, not of agreeing to indemnify, but to verify the signatures of NEAT's officers. Ms Dhiri had BNP's authority to sign the NEAT LOIs for that limited purpose." The Court at [108] held that BNP was not contractually bound to indemnify PCL. 125 Mr Rayment again says that is a guide in the present case that the mere fact that Ms Moore had some limited authority with respect to the transfer (that is to stamp it and lodge it for registration) was insufficient for her to be considered as Mr Williams' agent to know. 126 Mr Rayment then takes the Court to Schultz v Corwill Properties Pty Ltd (1969) 90 WN (Pt 1) (NSW) 529, 537-539. That was a Torrens system case. The basal facts were that Mrs Schultz invested money with a Mr Galea, solicitor, who lent it on mortgage to Corwill Properties Pty Ltd. Mr Galea was in fact the controller of that company. Mr Galea gave evidence that he in fact used Mrs Schultz's money for his own purposes, and without authority he had affixed Corwill's seal to the memorandum of mortgage over its land and forged his mother's signature as a co-director. The mortgage was registered. 127 L W Street J held that Mr Galea was not authorised by the company to commit the fraud, that fraud did not affect the registered proprietor. Accordingly Mrs Schultz's suit failed. 128 There is no gainsaying these authorities. However, they can be distinguished because in none of them did the person who was alleged to be the principal receive any benefit from the transaction. Where a person receives a benefit from the fraud of another, that person is not permitted to deny the agency. This is the Mair Principle referred to earlier in these reasons. There are a number of cases which illustrate this proposition. 129 The Mair Principle has been recognized in equity since at least 1787; see Dixon v Olmius (1787) 1 Cox 414; 29 ER 1227. In summarising the decision of Lord Thurlow in that case, Lord Eldon LC said in Huguenin v Baseley (1807) 14 Ves 273, 290; 33 ER 526, 532, that "Lord Thurlow … had no doubt, that it was against conscience, that one person should hold a benefit, which he derived through the fraud of another." 130 The principle was taken over in common law at least by 1874. In Swift v Jewsbury (1874) LR 9 QB 301, a decision of the Exchequer Chamber on appeal from the Court of Queen's Bench, Lord Coleridge CJ, giving the judgment of a five man court said at 312-313: "Justice points out, and authority supports justice in maintaining, that where a corporation takes advantage of the fraud of their agent, they cannot afterwards repudiate the agency and say that the act which has been done by the agent is not an act for which they are liable." 131 In Refuge Assurance Co Ltd v Kettlewell [1909] AC 243, the House of Lords dismissed an appeal where an insurance company had retained premiums obtained after representations made without its knowledge or authority. The trial judge had directed the jury that if the agent had been guilty of fraud, the company by retaining the premiums had ratified the representations even if they were made without authority. This was upheld by the Court of Appeal (see Kettlewell v Refuge Assurance Co [1908] 1 KB 545, especially per Buckley LJ at 552) and again in the House of Lords. 132 In Barrow v Bank of New South Wales [1931] VLR 323, 340, McArthur J as part of a Full Court said that the fraudster: "must, apparently be his agent in fact … for some purpose. But it is not necessary … that he should be his agent for the purpose of carrying out the transaction in the course of which the fraud was committed." 133 The Mair Principle is fully discussed in the note by Handley JA "Exclusion Clauses for Fraud" (2003) 119 LQR 537. 134 Mr Rayment says that the Mair Principle does not apply for three reasons: (a) Ms Moore was not a fraudster; (b) the Mair Principle does not apply where the alleged benefit is thrust upon the principal; and (c) in any event, no benefit was conferred on Mr Williams by the registration. 135 (3) It is thus necessary to consider whether (a) Ms Moore's act of altering the transfer was within her authority; and (b) whether that act constituted fraud. 136 As to (a), Mr Rayment says that registration clerks, even though running their own business, are unqualified people who are only entrusted with the mechanical job of filing documents. She had limited authority and was not an agent to know. 137 Accordingly, she had no authority to alter the transfer and to have that act attributed to Mr Williams, unless the Mair Principle applies. 138 As to (b), it must first be observed that the fraud we are talking about in connection with the Mair Principle is not statutory fraud, but fraud at law, or possibly, equitable fraud. 139 Mr Rayment submits that one should not assume that if Ms Moore did alter the document, it was in any way accompanied by the kind of moral turpitude. She was merely mistaken in her view of what needed to be done to effect the purpose that Ms Pinter had entrusted to her. 140 Moral turpitude and dishonesty are required to constitute fraud, and this involves mens rea. Even stupidity is not enough. Accordingly, Mr Rayment submits when you find an unqualified person who seems obviously to have so far exceeded her instructions the court should not reach a conclusion that there was moral turpitude. It would seem that the clerk took a shortcut which she may have conceived to be in some way permissible when it was plainly not, not with a view to personal profit or anything else. As no fraud was ever alleged against the registration clerk in the pleadings, it was not surprising that she was not called and no Jones v Dunkel inference ought to be drawn from her absence. 141 Mr Alexis for the respondent said that there was no other explanation for the alteration save fraud. In the absence of no other explanation being proffered, the proper inference to be drawn is that Ms Moore understood the nature of the transaction, she effected the alteration to render the second transfer unnecessary and what she did was fraudulent. 142 A charge of fraud is a serious one and needs to be properly established. It does not seem to me that in the absence of Ms Moore or any admissions by her of fraudulent intent that one can infer anything more than ignorance, certainly one should not infer any moral turpitude. With great respect, the trial judge seemed to consider that once she had altered the document knowing that it was going to be lodged with the Registrar General, that that was enough. With great respect I do not consider that that is so and I consider Mr Rayment's submissions on this aspect were correct. 143 (4) Mr Rayment took issue with the proposition that his client had obtained a benefit. The transcript shows that I put to him "If someone does an unauthorised act and then you take the benefit of it, you have ratified it anyhow haven't you whether it was authorised or not?" Rayment: "That's if you know of it. There was no taking of the benefit of it here". Young CJ in Eq: "You got the benefit of the registration of the forged …" Rayment: "Yes that was thrust on us rather than assumed by us in our submission." Young CJ in Eq: "But you got the benefit of it whether it was thrust on you or not." 144 The argument was developed, but it never reached the stage of demonstrating what was meant by benefit in the Mair Principle or whether it was relevant that the benefit was thrust upon the beneficiary. 145 I have reread the cases referred to in Handley JA's article which I have listed earlier. None of them seems to deal directly with this issue. However, the synonyms used for "benefit" eg "profit", "takes advantage" indicate that the word is given a wide meaning. 146 I have also reread the cases on "free acceptance of an incontrovertible benefit" in the law of restitution, but again, can find no guidance from that line of territory. 147 Mr Rayment put that obtaining registration in the way it was obtained was not a benefit. This is because, the registration was open to attack. If Ms Moore had not have acted as she did, Mr Williams would have obtained an indefeasible title. 148 The statement of fact made in the last sentence of the previous paragraph is correct. However, in my view Mr Williams did obtain a benefit from the transaction as is witnessed by the fact that his estate is now fighting to retain it. 149 My conclusion is that the points raised by Mr Rayment do not take this case outside the Mair Principle. Thus, if there was fraud on the part of Ms Moore, the advantage of her fraud in obtaining registration was retained by Mr Williams and he cannot deny her authority. 150 (5) It follows from what has already been said that this question must be answered, "No". 151 (6) As I have already noted, the current s 97 of the Real Property Act had not come into force when the relevant events occurred. The question must then be asked, what would have happened under the practice in the Registrar General's Office as at mid-1994 if the second transfer from Mr Williams to himself had been tendered for registration. 152 Butterworths Conveyancing Service Vol 1 [11005] as it was issued in 1987 and 1989 states that: "As to land under the Real Property Act 1900 it is clear that severance of the legal title can be effected only by registration of a transfer or transmission whether there be a severance in equity or not. There must be the registration of a dealing which results in the alteration of the register." The authority cited is Wright v Gibbons (1949) 78 CLR 313 where A, B and C were registered as joint tenants, A transferred her interest to B and B to A and the High Court held that that effected a severance between all three. 153 In Williams v Hensman (1861) 1 J & H 546, 557; 70 ER 862, 867, Page Wood VC said: "A joint-tenancy may be severed in three ways: in the first place, an act of any one of the persons interested operating upon his own share may create a severance as to that share. The right of each joint-tenant is a right by survivorship only in the event of no severance having taken place of the share which is claimed under the jus accrescendi . Each one is at liberty to dispose of his interest in such manner as to sever it from the joint fund – losing, of course, at the same time, his own right of survivorship." 154 The High Court in Corin v Patton (1990) 169 CLR 540 adopted the approach of Page Wood VC in Hensman's case and discussed the way in which there can be severance where there is a joint tenancy under the Real Property Act. 155 Although transferring one's share to a stranger was the traditional method of severing a joint tenancy, in Canada in Re Murdoch and Barry (1975) 64 DLR (3d) 222, Goodman J in the Ontario High Court held that a conveyance by one joint tenant to herself by deed effected a severance. This decision was approved by Needham J in McNab v Earle [1981] 2 NSWLR 673 and his Honour seems to have assumed that a registered Torrens system transfer from a joint tenant to himself as tenant in common would have the same effect. However, in the case before him the transfer had not been registered so Needham J held it was ineffective. See also Cray v Willis (1729) 2 P WMS 529; 24 ER 847. 156 Accordingly, as at 1994, had Ms Moore done as she was instructed by Ms Pinter to lodge both transfers, the probability would have been that Mr Williams would have ended up as a tenant in common with his wife without there being any notification to the wife at all. The Registrar General had no mandate to notify the wife and there is no indication of any practice of him doing so. 157 (7) Although not necessary for the result of this case, I believe that it is useful to spend a brief time on the question of the nature of a claim to rectify the Torrens Register. 158 It must be remembered that under the Torrens system, the general flavour, induced by Mr Torrens' distaste for the uncertainty of equitable interests in land, was that they were not to be recognised at all; vide s 41, though judicial decisions over the last 140 years have made sure that equitable interests in Torrens land are still recognised and significant. The court is given some power to direct rectification of the register and to direct cancellation of folios under s 138 of the Real Property Act, and the Registrar General is entitled to state a case under s 124 and various other people are given rights to approach the court. However, those rights are not to approach an Equity Court, but to approach the Full Court or the Court at Common Law. The right to have the register "rectified" is purely a statutory right: it has nothing to do with equity. 159 I believe that confusion has been caused by use of the term "rectification". Rectification usually denotes an order in equity whereby parties are compelled to adjust a written contract to accord with their true agreement. It is based on the equity of mistake. 160 The Real Property Act itself confers certain powers on the Registrar General to rectify and adjust the register; see eg ss 12(1) and 32(6). As I have already noted, under s 138 of the Act, the Court is given authority in appropriate cases to direct the Registrar General to make entries in the register and the Registrar General has the statutory duty to comply with the order. 161 The Court may make an order under s 138 of the Real Property Act when, in the appropriate proceedings, it has determined as a matter of law or as a matter of equity that the register needs adjustment. An example of the latter is JA Westaway & Son Pty Ltd v Registrar General (1996) 7 BPR 14773. However, that seems to be the only relevance that equitable principles have in an application which includes an order to "rectify" the Torrens Register. 162 (8) Although not given much attention in argument below, it is clear that by the time the opponent commenced her proceedings, Mr Davis, as executor of Mr Williams had himself been registered as proprietor of the relevant land by transmission. 163 In Spark v Meers [1971] 2 NSWLR 1, 9-10, Hope J said: "When in due course the executor or administrator becomes registered pursuant to a transmission application, he will be the registered proprietor and will undoubtedly have all the rights and the protection which the Real Property Act gives to a registered proprietor." 164 There was no doubt on the facts before his Honour that unless s 118(1)(d) of the Real Property Act operates to prevent it, Mr Davis had an indefeasible title. This case could not have been decided on the strict application of the Real Property Act. It was really an equity suit; see Bogdanovic v Koteff (1988) 12 NSWLR 472. 165 Section 118(1)(d)(ii) of the Real Property Act 1900 makes an exception to the general rule that ejectment does not lie against the registered proprietor where: "proceedings [are] brought by a person deprived of land by fraud against … a person deriving (otherwise than as a transferee bona fide for valuable consideration) from or through a person registered as proprietor of the land through fraud." 166 On the assumption that the present proceedings are proceedings for recovery of land, had there been fraud by Mr Williams, s 118(1)(d) would have been Mr Davis' Achilles Heel on the indefeasibility question. 167 As there was no such fraud, Mr Davis has an indefeasible title. The case could not have succeeded against him if confined to the application of the Real Property Act. Indeed, the proceedings really were an equity suit. 168 The opponent's real case was that Mr Williams' estate of which Mr Davis was the executor was bound by various equities. Mr Davis, as the executor, was fixed with the same equities which bound Mr Williams and Mr Williams would have been bound by equities which affected his agent Ms Pinter. Just what were those equities was never explored before the learned trial judge because of the way in which the case had been conducted. 169 It must always be remembered that there are actually two separate streams of thought that must be mustered in this sort of case. One stream directed to whether there is statutory fraud and another as to whether there is any in personam equitable right which affects the registered proprietor. It is easy to get the two streams commixed. 170 In the present case the matter was dealt with as if the first stream only applied except in so far as there was reference to rectification of the transfer. Even this was not rectification in the true equitable sense because it was not sought to rectify a contract on the ground of mistake but rather to remove unauthorised additions to the document and to restore it to its pristine state. 171 Of course, had the matter been under common law title, there would have been no need to approach equity because the document would have been void as against Mrs Williams at common law. This point, however, does not take us any closer to the solution of the present case. 172 (9) I thus now turn to the to the second major aspect of the case, what has been called the "Frazer v Walker point", that is, whether Mrs Williams had some personal equity which ought to be vindicated. 173 In Frazer v Walker [1967] 1 AC 569, the Privy Council held that even though a registered interest was indefeasible under the Torrens system, the registered proprietor was still subject to personal equities which affected the registered proprietor personally. 174 At page 40 of the transcript, Hodgson JA said to Mr Alexis: "But you are seeking to make out a case, are you, that there was a perfected equitable entitlement to an interest as a joint tenant. The whole series of events that resulted in that being changed to an entitlement as a tenant in common and the resulting deprivation of an interest of survivorship when the deceased died was in its totality a chain of events for which the deceased was responsible and was therefore such that there was a personal equity against the deceased to have the position restored. You are seeking to make out that?" Alexis: "Yes". Young CJ in Eq: "How did you get that on the pleadings? Alexis: "It's not pleaded as articulately as the presiding judge has just put it to me." Young CJ in Eq: "Not a mention of equity in the pleading." Alexis: "But the facts are certainly pleaded. The matters that your Honour has put were certainly debated before his Honour in terms of the relief sought pursuant to the first opponents claim in personam." 175 At the end of the debate Mr Alexis said: "Perhaps the result ought to be, if your Honours are minded to allow Mrs Williams to retain ownership of the whole property as the surviving joint tenant that she relevantly do equity by having to deal with the equitable lien suit that arises out of this case that your Honours might think appropriate to send back either to his Honour or the Master." 176 To this, Hodgson JA replied: "What I'm inclined to do is, I think, more favourable to you. My tentative view is that if there is to be in the future a Family Provision Act claim on one side or the other, then this issue should be fully open to be ventilated in that claim. However if for whatever reason there is no such Family Provision Act claim, I think the other side have had their chance and the matter should end here and now. But primarily because I think to be entitled to any sort of lien or even any sort of equitable accounting that might give rise to a lien, there needed to be a prima facie case made out that the contribution by the mortgage payments and the increase in value by the improvements outweighed the value of the accommodation. And that prima facie case has not been made out." 177 In reply, Mr Rayment said: "His Honour hasn't turned his mind to the competing equities as it were in this matter or the underlying unconscionability. His Honour has instead treated this matter, as it were, beginning with fraud under the Real Property Act and ending with that question. He put that Davies AJ's approach to the question would have been very different if this had been squarely an equitable case in which competing equities had to be assessed. That case, however, could not be found in the pleadings. 178 The basis of the personal equity case is that Mrs Williams had, when the transfer from the NSW Land and Housing Corporation was handed to Ms Moore, an equitable interest in the land as joint tenant. Through no fault of her own, she lost that interest though the actions of Mr Williams's Mair Principle agent and Mr Davis, the current registered proprietor is subject to the equities which bound Mr Williams. 179 Mrs William's personal equity case would seem strongly arguable. However, there are three major problems that have first to be addressed before I can consider it finally. These are: (a) the failure to plead the claim; (b) the failure to offer to do equity; and (c) Mrs Williams, because of the way the case was run, presented very little material before Davies AJ from which his Honour could have found there was some personal equity as against either Mr Williams or Mr Davis, his executor. 180 (10) Looking at the pleadings in the present case, one would not think that the Frazer v Walker principle had anything to do with the case. There was no mention at all of the word "equity" in the statement of claim: the only relief, apart from declaratory relief, was that the register be rectified. 181 Thus the Court was faced with a matter which was not argued before the court below which put the case on a completely different basis, but which appeared to be more in tune with the realities of the dispute between the parties. The case appears to have been run before the trial judge on the basis of an action at law for rectification of the Torrens register based on the incorrect registration of a document through fraud. The result of that suit must have been to remove the transfer from the register. However, after that time, without fraud, Mr Davis the executor had become registered by transmission. 182 Of course, a suit can be framed in such a way that it seeks orders that the registered proprietor do something or not do something, the order being directed to the registered proprietor in personam. That is a completely different matter in principle to an action to rectify the Torrens register. 183 There is no mention in his Honour's judgment of Frazer v Walker and the only mention of a personal action is in paras [38] and [39] where his Honour said that Mrs Williams has a personal entitlement to have the transfer from the Land and Housing Corporation rectified to reflect the agreement between the parties. 184 Grounds 5 and 6 of the notice of appeal are that Davies AJ erred in holding that Mrs Williams had a personal entitlement to have the transfer rectified and that his Honour erred in failing to hold that any such equity for rectification could be asserted so as to overcome the right on the part of the deceased to sever the joint tenancy and the indefeasibility of title. In answer to those grounds counsel for Mrs Williams calls in aid the Frazer v Walker principle. 185 The actual order made by the Judge was to make a declaration that Mrs Williams was entitled to be registered as the proprietor of the whole of the land contained in the relevant Folio Identifier and that the second defendant, the Registrar General, rectify the register of the Folio accordingly. 186 The following debate took place between the Court and Mr Alexis at p 30 of the transcript. "Hodgson JA: She's entitled to be registered and rectify, so that is an order that not merely removes an incorrect entry but requires the making of a correct entry on the basis of an equitable entitlement. Alexis: Yes, and I can indicate to your Honours that the formulation of the declaration and order was made in consultation with the Registrar General's office having regard to the events that have occurred subsequent to the events of 1994, namely the registration of a transmission application by the executor and it was thought that the most efficient means of perfecting his Honour's conclusion was to make a declaration in accordance with paragraph 1 and the order in accordance with paragraph 2 which his Honour duly did. Young CJ in Eq: But that's an equitable order, isn't it? It's a vesting order consequent upon findings of trust. Alternatively it's giving effect to her equitable tenancy in common. Hodgson JA: Her equitable joint tenancy, yes. Gzell J: So it is an equity suit, not a suit at law. Alexis: Yes it is, your Honour. There was no suggestion below, nor could there be, that Mrs Pinter executed the transfer with instructions or authority from Mrs Williams and of course as we've submitted her execution of the transfer on behalf of the transferees was essential to the means by which the subsequent transfer became capable of registration. Young CJ in Eq: Although what Mrs Pinter did may be classed as a fraud against the Registrar General it wasn't a fraud against Mrs Williams. Alexis: No, it wasn't, because had the alteration to the transfer not occurred Mrs Williams would not have any cause for complaint. She would have received precisely the interest that she was entitled to under the contract. Hodgson JA: Just so I can see where we're going, the judge found on the basis of fraud. Are you seeking to rely on an alternative basis of an equity that should not be defeated by these kinds of actions, maybe falling short of fraud, done on behalf of the registered proprietor? Alexis: Yes. Young CJ in Eq: You never offered to do equity, did you? Alexis: Yes. Young CJ in Eq: So wasn't your suit demurrable? Alexis: That may be so but that is precisely the way the point is put and to the extent necessary we will contend that." 187 In my view the waters were sufficiently murky below to make it hard to say that the personal equity point was not at least hovering in the background. I would be reluctant to decide that Mrs Williams cannot raise the personal equity point. However, as will appear from subsequent paragraphs, very awkward questions arise. 188 (11) Before considering what offers to do equity ought to have been expected of the opponent in her pleadings or, at least, at the hearing, it is necessary to consider the position of the estate of Mr Williams. 189 The clear fact is that Mrs Williams left the home in 1969 and Mr Williams had thereafter maintained it and paid all the outgoings. 190 A good place to start the discussion is the decision of Macrossan CJ in McMahon v The Public Curator of Queensland [1952] St R Qd 197, 201 where the learned Chief Justice said: "In general a co-tenant could not compel other co-tenants to contribute to the cost of repairs or improvements effected by him. But in a partition action (and now in an action for sale in lieu of partition) he was allowed sums properly spent on substantial repairs and improvements." His Honour then noted that in Brickwood v Young (1905) 2 CLR 387, 394, Griffith CJ had pointed out that this doctrine was of comparatively recent development noting the earliest reported case was Swan v Swan (1820) 8 Price 516; 146 ER 1281. He also noted that if in such an action a co-tenant sought compensation for improvements he had to account for an occupation fee if he had been in sole occupation: see Leigh v Dickeson (1884) 15 QBD 60, 67. 191 This matter was thoroughly examined by this Court in Forgeard v Shanahan (1994) 35 NSWLR 206. See also Houghton v Immer (No 155) Pty Ltd (1997) 44 NSWLR 46 and Ryan v Dries (2002) 10 BPR 19497, 19510-1. 192 No allowance is made outside a partition suit or the modern equivalent for improvements to a property by one co-owner. Even in a partition suit the co-tenant in occupation must provide evidence not only that he or she has spent money on the property, but also that the value of the property has increased because of that expenditure. Unfortunately, it is often the case that money is spent on private residences to increase the comfort of the occupiers which does not materially increase the value of the whole property. 193 Once one has worked out if the money spent by the occupying co-owner has increased the value, then one offsets the occupation fee. However, if no amount is claimed for improvements no occupation is chargeable unless there has been a complete ouster of the other co-owner (which is not the situation in the present case) and accordingly the occupying co-owner will never have to pay any money even if the value of the occupation fee exceeds the increase in value as a result of the improvements. 194 In the instant case there was just not the evidence to show that had this been a partition suit, some allowance should be made to Mr Williams' estate with respect to improvements. 195 However, under the Local Government Act 1993, Mrs Williams was liable to contribute a moiety of the rates paid by Mr Williams on the property, presumably for the six years before suit. This is a relatively minor matter and does not appear to have been raised at the trial. 196 Furthermore, it would seem clear that after Mrs Williams left the home in 1969 Mr Williams made all the payments to the Housing Authority. If Mrs Williams is to claim that the whole property is held in trust for her, equity would demand that she at least offer to reimburse Mr Williams' estate with her proper moiety of the payments made to the bank with interest. 197 When dealing with the cross claim on this issue, Davies AJ said that a counterclaim made by the estate for reimbursement of the monies paid to the Housing Authority would be defeated on the evidence before him because of the presumption of advancement. There was just no evidence before his Honour that the presumption of advancement was rebutted. Mr Williams had paid, it would seem, the moneys due under the mortgage without demur and there was no evidence he had ever made a claim on Mrs Williams. 198 Another problem with the way the trial was conducted, that is, without any reference apart from some oblique reference to equitable principles until the form of order was considered and the fact that it was assumed that s 97 of the Real Property Act was in force at the relevant time, was that no consideration was given to the point that the only thing that Mrs Williams lost was the opportunity to be aware that there was a transfer from the Corporation being registered in favour of her and her husband as joint tenants. Indeed, as things have worked out, the person who lost out was Mr Williams because his intention that his solicitor put forward the appropriate documentation to bar the right of survivorship was thwarted. 199 Although not a rule of universal application, in many suits in equity, a person claiming relief must not just offer to give to the opposing party what he or she was required to render as a matter of law. Often, a party seeking equity is taken to have elected to surrender reliance on his or her legal rights, see Jervis v Berridge (1873) LR 8 Ch App 351, 358. This particularly applies in suits for relief against forfeiture. In such cases, as a condition of obtaining equitable relief, the plaintiff must offer to do equity or at least submit to a condition that involves the doing of equity. 200 Thus, where a person seeks equitable relief in a transaction which is void under the moneylending legislation, an equity court will not give equitable relief except on terms that the money actually borrowed and some interest be paid. This condition is imposed notwithstanding that at law, the moneylender could not even sue for the money lent. This is clear from Lodge v National Union Investment Company Ltd [1907] 1 Ch 300. 201 Again where a minor seeks the aid of a court of equity, he or she will need to submit to a terms that borrowed money be repaid, even though at law, no action would lie for its repayment, Overton v Banister (1844) 3 Hare 503, 506; 67 ER 479, 481; R Leslie Ltd v Sheill [1914] 3 KB 607, 626. 202 It is clear that had the matter of the terms on which Mrs Williams' personal equity should be vindicated by order been before the learned trial judge, he would need to have given that matter very deep consideration. However, because the case was approached as an almost mechanical exercise under the Real Property Act this did not occur. It is quite inappropriate for this Court to become involved in such an exercise. 203 (12) As will have appeared from what I said in section (11), this is a very awkward question. The order actually made vests in Mrs Williams an unencumbered fee simple of the whole property. It leaves Mr Williams' estate which had a legal fee simple in half and which had paid the rates and mortgage monies over many years with nothing. The only matter against Mr Williams' conscience was that a Mair Principle agent whom he had never met altered a document in circumstances where had she done as she was told, Mr Williams would have had an unimpeachable interest in half the land. 204 The only real loss that Mrs Williams suffered was the loss of the chance to bring proceedings in the Family Court to prevent the severance or obtain an order under s 79 of the Family Law Act. This was a very nebulous right as there was little likelihood prior to the coming into force of s 97 of the Real Property Act of her becoming aware of the transaction. Alternatively, she lost the chance of survival. (We now know that she did survive, but any equitable compensation should be assessed at the date of the transaction). 205 Of course, Mrs Williams would have become aware of the fact that the legal title was being put into two names if the solicitor had sought her instructions to accept the transfer on her behalf as she should have done. However that matter does not affect the present judgment. 206 Thus, I consider that it would be difficult to impose conditions on the opponent. In default of her offering reasonable terms, the court would probably do no more than order equitable compensation to her if her personal equity claim succeeded. 207 (13) now digress to consider a matter which arose during argument, but which is not vital to the result of the case. 208 It was suggested by Mr Rayment that a solution might be to set aside the current registration, but allow the transfer from Mr Williams to himself now to be registered. 209 In JA Westaway & Son Pty Ltd v Registrar General (1996) 7 BPR 14,773, 14,792 I held, relying on the decision of this Court in McVey v Denis (1984) 55 ALR 201, 205, that where a transferor dies, the warrant to the Registrar General to alter the register constituted by that transfer ceases to have effect. This has, as I understand it, been considered to be the law in this State for many years. 210 In Tierney v Halfpenny (1883) 9 VLR (Eq) 152, 157, Molesworth J said, during argument concerning a transfer signed by the deceased before his death but not registered, "I think the transfer is valid enough" and that utterance seemed to terminate that aspect of the case before him. In National Trustees Executors and Agency Co of Australasia Ltd v Boyd (1926) 39 CLR 72, 84, Isaacs J, the only judge to mention the point, said, "the death of either or both of the parties to a transfer is no necessary obstacle to registration (Tierney v Halfpenny)". 211 Issac J's words in Boyd were not apparently cited to this Court in McVey. Notwithstanding this, I consider that I should continue to follow that decision and uphold what I said in Westaway. 212 Accordingly, in my view, the unregistered transfer by Mr Williams to himself is not available to be registered in 2003 or later. 213 (14) It follows from what I have said above, that Mrs Williams had an equitable interest in the land as joint tenant which was defeated by the action of Mr Williams' Mair agent. To the extent that it was against Mr Williams' conscience to benefit from this transaction, Mrs Williams had a personal action in equity. This was not pleaded. Had it been pleaded, Mrs Williams would have had to offer or submit to conditions. The court would have awarded the minimum equity to salve Mr Williams' conscience. Because of the difficulty in imposing meaningful conditions, this would probably have meant that a small amount of equitable compensation only would have been awarded and the title at law left intact. 214 (15) It was argued before the trial judge that a constructive trust should be imposed on Mrs Williams' share to recognise the expenses paid by Mr Williams after she left the property. Davies AJ dismissed this very summarily saying that the facts did not prove that Mr Williams made a substantially greater contribution to the property than Mrs Williams. 215 The argument indeed seems to run contrary to the established law governing payments by co-owners in respect of their joint property which has already been discussed. 216 There was some dispute as to whether the claimant actually made a claim for lien before the trial judge. There seems to be some confusion as to whether there was an amended cross claim put on before the Judge which claimed a lien. If it was, Mr Alexis says that his client denied there was a lien but there is nothing in the documentation to suggest that his client ever did so and in any event the learned Judge did not deal with the matter. 217 I have already noted what his Honour held about the effect of the presumption of advancement on this claim. He was thus well entitled not to take any claim for lien any further. My only real concern is that the claim for lien did not seem to be put fairly and squarely before his Honour and his Honour was really directing his mind to the constructive trust claim. 218 In the instant case there was just not the evidence to show that had this been a partition suit, some allowance should be made to Mr Williams' estate or even if there had been, that that was the foundation for a constructive trust. 219 Accordingly the trial judge's decision on the cross claim must stand. 220 (16) Before the learned trial judge, the claimant conceded that unless the claim to a tenancy in common succeeded, the claim for an equitable charge or lien did not arise. Before us, Mr Rayment sought to withdraw the concession. Mr Alexis objected to the withdrawal, but fairly noted that he could not advance any prejudice. Indeed, because of the way the trial judge decided the case, it was of no value. For what it is worth, the concession should be allowed to be withdrawn. 221 (17) To recapitulate, in my view: (1) There was insufficient evidence to show that Ms Moore was guilty of statutory fraud or indeed of fraud at all. (2) Had she been guilty of fraud, then, under the Mair Principle, Ms Moore must have been taken to be the agent of Mr Williams. (3) If there was no fraud and the Mair Principle was thus inapplicable, there was not sufficient evidence of authority of Ms Moore. (4) Accordingly, the Judge erred in finding that Mr Williams' title was not indefeasible. (5) As there was no fraud by Mr Williams, Mr Davis now has an indefeasible title. Mr Davis' title was actually the subject of pleading in clause 5 of the statement of claim, but the significance of this matter seems to have been completely overlooked at the hearing. (6) There was no pleading of any equitable principle. However, somewhere before the end of the trial equitable principles were brought into play. (7) Had the Judge needed to consider the equitable principles, he would not have made the order he did make, but, at the most, awarded a small amount of equitable compensation. (8) There was insufficient evidence before the Judge to make any order for constructive trust or for accounting against Mrs Williams. (9) It is unclear whether the question of equitable lien was properly ventilated before the Judge but he seems to have taken the view that it would have been trumped by the presumption of advancement. (10) Mrs Williams' application under the Family Provision Act 1982 is still on foot. It is clear that if she succeeds in maintaining the judgment of Davies AJ that application needs to be dismissed as she virtually will have the whole estate. If, however, this appeal succeeds, the "merits" between the parties and the amount they have spent on the house etc can be worked out during the Family Provision Act proceedings unless, of course, what used to be called "jurisdiction" is not established because Mrs Williams is not able to show any need. 222 From what I have said, the appeal needs to be allowed. I can see no need to send the matter back to the Equity Division because the real issues were not raised before the trial judge, the parties should not have a second chance at litigation and, in any event, the merits can be considered in connection with the still pending application under the Family Provision Act. 223 Accordingly I would propose the following orders: (1) Appeal allowed. (2) Orders made by Davies AJ be set aside. (3) Order that the claim by the opponent as surviving joint tenant to a half share in the half share of the estate of Malcolm Clarence Williams in the property 19 Heyson Avenue, Ermington, NSW, be dismissed. (4) Order that the opponent pay the costs of the claimant and of the second opponent both of the trial before Davies AJ and this appeal. (5) First opponent to have a certificate under the Suitors' Fund Act if qualified. (6) Remit the proceedings to the Equity Division for the Family Provision Act application to be heard and determined. 224 GZELL J: The facts and circumstances surrounding the hearing in the court below and on appeal are set out in the judgment of Young CJ in Eq. I have had the advantage of reading that judgment. 225 The first issue, in my view, is whether there was fraud on the part of the registration clerk within the meaning of the Real Property Act 1900, s 42(1). 226 In Assets Co Ltd v Mere Roihi [1905] AC 176 at 210, Lord Lindley said that fraud for this purpose meant actual fraud, that is, dishonesty of some sort, not what was called constructive or equitable fraud. That does not mean that all forms of equitable fraud are outside the statutory concept (Latec Investments Ltd v Hotel Terrigal Pty Ltd (in liq) (1965) 113 CLR 265 at 273-274, Bahr v Nicolay (No 2) (1987-1988) 164 CLR 604 at 614). 227 Beyond stating that fraud clearly implied some act of dishonesty and indicating that if the designed object of a transfer was to cheat a man of a known existing right, that was fraudulent, as was a deliberate and dishonest trick causing an interest not to be registered and thus fraudulently keeping the register clear, Lord Buckmaster said it was neither necessary nor wise to give abstract illustrations of what might constitute fraud for each case depended upon its own circumstances (Wiamiha Sawmilling Co Ltd v Waione Timber Co Ltd [1926] AC 101 at 106-107). 228 It was the High Court that introduced the concept of moral turpitude. In Butler v Fairclough (1917) 23 CLR 78 at 90, 97 it spoke of fraud as importing personal dishonesty or moral turpitude. Moral turpitude is rather an extreme synonym for personal dishonesty, if synonym it was meant to be. It connotes depravity, vileness, wickedness, baseness. However, as an alternative to personal dishonesty, it has been maintained by the High Court as part of the description of statutory fraud (Wicks v Bennett (1921) 30 CLR 80 at 91, Stuart v Kingston (1922-1923) 32 CLR 309 at 329, Latec Investments at 273-274, Bahr at 614). 229 Within this concept of statutory fraud, a line of authority has developed to the effect that the dishonest lodgement of a false document with the Registrar-General to obtain registration is fraud for the purposes of the statute. 230 In Australian Guarantee Corporation Ltd v De Jager [1984] VR 483, an agent of the finance company attested to the signature of a husband as mortgagor and returned the document to employees of the finance company. The document bore a signature purporting to be that of the wife as the other mortgagor. The employees pointed out to the agent that her signature had not been attested. Notwithstanding that he told the employees he had not been present when the wife signed the document, the agent then attested that he had. The mortgage was thereafter lodged for registration. The wife's signature was a forgery. Neither the agent nor the employees of the finance company were aware of this fact. 231 Tadgell J at 496-497 found a case of fraud within the meaning of the statute in that employees of the finance company and therefore the finance company itself, caused or allowed the mortgage to go forward for registration after the agent had signed it by way of attesting to the wife's signature in his presence. 232 Tadgell J did not rely upon any admission by the employees that they had a dishonest intent. His Honour regarded the lodgement of the false document as fraud a priori. 233 The Torrens system is designed to enable the public to rely upon entries on the register. One of the safeguards to the integrity of those entries is the requirement that instruments be signed by the parties to a transaction and that their signatures be the subject of attestation. That is no mere formality. As Tadgell J said at 497: "… if there is a currency in the notion that the signature of an attesting witness to a document to be registered under the Transfer of Land Act 1958 is no more than a formality, then the sooner it is dispelled the better. Nothing, in my opinion, could be more unwarrantable. A system of land title by registration, such as the Torrens system is, plainly depends on the good faith of those presenting instruments for registration." 234 The personal dishonesty or moral turpitude of the employees of the finance company lay in their representation to the Registrar of Titles that the attesting witness was present when the wife signed the mortgage. 235 Proof of mens rea by direct evidence was unnecessary. It was to be inferred from the lodgement of the document with knowledge that the attesting witness had not seen the wife sign the mortgage. 236 As Tadgell J said at 498: "A moment's reflection will confirm that, when AGC presented the subject instrument of mortgage for registration, it was representing to the Registrar of Titles, as against the mortgagors, an honest belief that they, and each of them, had executed the instrument in the presence of a witness who, if it came to the point, could be relied on to prove the execution. To lodge an instrument for registration in the knowledge that the attesting witness had not been present at execution must deprive the lodging party of an honest belief that it is a genuine document on which the Registrar can properly act." 237 To like effect is National Commercial Banking Corporation of Australia Ltd v Hedley (1984) 3 BPR 97210. At 9480, Hodgson J in like circumstances drew the inference, that in making the assertion to the Registrar-General that the mortgage had been signed in his presence by both mortgagors, the bank employee either knew it was false, or had no honest belief in its truth and acted recklessly as to whether or not it was true. The decision was reversed on another point (Hedley v National Commercial Banking Group of Australia, unreported, NSWCA, 31 October 1986). 238 A different result arose in Grgic v Australian and New Zealand Banking Group Ltd (1994) 33 NSWLR 202. A customer and his wife introduced an impersonator to the bank as the father of the customer. He had the certificate of title and other documents relating to the land in his possession. He forged the signature of the father to a mortgage in the presence of the bank officer who attested to the forged signature. 239 There was no fraud on the part of the bank. As had been said in Mere Roihi at 210, a person who presents for registration a document that is forged or has been fraudulently or improperly obtained, is not guilty of fraud if he honestly believes it to be a genuine document that can, properly, be acted upon. The decision does not detract from the approach taken in De Jager and in Hedley. 240 To similar effect to those cases is Westpac Banking Corporation v Sansom (1994) 6 BPR 97509. A wife forged the signature of her husband on a mortgage which she signed in the presence of a bank officer who attested to both signatures. At 13796, Rolfe J followed Hedley in concluding that there is fraud for the purpose of the statute when a representation is made, contrary to the fact, that a person is personally known to the attesting witness and has signed the document in his or her presence. The decision was affirmed on appeal, Sansom v Westpac Banking Corp (1996) 7 BPR 97584. 241 Beatty v ANZ Banking Group Ltd [1995] 2 VR 301 is also to like effect with respect to this issue. At 315, Mandie J followed De Jager in concluding that there was a case of statutory fraud against the bank by its false representation to the Registrar of Titles that it had an honest belief that the plaintiff whose signature to the mortgage was forged had executed it in the presence of the attesting bank officer. 242 Pyramid Building Society (in liq) v Scorpion Hotels Pty Ltd [1998] 1 VR 188 does not require a different conclusion. The common seal of a corporate trustee was affixed to a mortgage and it was signed by the wife of one of the directors who was not herself a director. The solicitor for the building society had obtained a search of the corporate trustee but had not checked it and consequently did not discover that the wife was not a director. 243 In reversing the decision below, that fraud was constituted by a reckless indifference to the truth of the document tendered for registration, the Court of Appeal at 194 took the view that the evidence went no further than to show that had the building society made further enquiries it would have discovered that the mortgage had not been properly executed. That did not constitute fraud. As was said in Mere Roihi at 210, the mere fact that one might have found out fraud if one had been more vigilant, and had made further enquiries which were not made, does not of itself prove fraud. The decision, does not, in my view, detract from the propositions in De Jager and Hedley. 244 To similar effect to those cases is Hickey v Powershift Tractors Pty Ltd (1998) 9 BPR 97799. Bryson J took the view that fraud was established for the purpose of the statute by the lodgement of a document with false attestation of the genuine signature of a mortgagor. The mortgagor had signed in the presence of a director of the finance company. Concerned that his position might have some effect on the transaction, he persuaded an independent person to attest the signature. 245 The gravamen of the statutory fraud demonstrated by this line of authority, is the deliberate misrepresentation for the purpose of obtaining registration of a transaction. The misrepresentation for this purpose is sufficient to establish personal dishonesty and moral turpitude. 246 The decision of the Victorian Court of Appeal in Russo v Bendigo Bank Ltd [1999] 3 VR 376 may be thought, at first glance, to run counter to this line of authority. The mortgagor's signature had been forged. A clerk of the bank's solicitor, unaware of the forgery, signed the attestation clause contrary to the standing instruction of the solicitor not to attest the signature unless the person had signed in her presence. Neither the solicitor nor the bank was aware of the forgery. 247 The trial judge found that the clerk was not in a position to put the mortgage on the path to registration with knowledge of falsity and that, even if she did, the solicitor honestly believed that the clerk had witnessed the signature and it was he who put the documents on the path to registration with an honest mind. 248 Ormiston JA with whose reasons Winneke P and Batt JA agreed at 382 interpreted the primary judge to have found that the clerk had not acted dishonestly. At 386 his Honour upheld that finding on the basis that known falsity was not enough and that the final critical element in fraud, namely dishonesty, required a wilful and conscious seeking to defeat or disregard another's rights. His Honour went on to conclude at 387 that it had not been established that the clerk had the necessary appreciation of the consequence or significance of her false statement. 249 Without participation in the lodgement of the false document with the Registrar of Titles, the clerk was not party to a false representation against the mortgagor. That is the point of distinction and the basis for the finding that the clerk was not personally dishonest a priori. There was no false representation to the Registrar of Titles because the solicitor himself honestly believed that the mortgagor's signature had been attested properly. 250 This is not a case of false attestation. It is a case of false alteration of the transfer. In my opinion, however, the same principle applies. 251 Beatty is direct authority for that proposition. Not only did the bank officer falsely attest that she was a witness to the plaintiff's signature, but also she added the plaintiff's maiden name after her married name in the mortgage, the certificate of title being in the plaintiff's maiden name. 252 Mandie J held the alteration also constituted fraud for the purpose of the statute. At 316, his Honour said that it was a necessary inference that whoever made the alteration could not have been unaware that it would be falsely conveyed to the Registrar of Titles by the submission of the mortgage that the document had been executed in its altered state by the mortgagors. That was sufficient in his Honour's view to constitute statutory fraud. 253 In the instant circumstances, by altering the instrument and lodging it, the registration clerk falsely represented to the Registrar-General that New South Wales Land and Housing Corporation had transferred the land to the first opponent and her husband as tenants in common in equal shares. The false lodgement of the altered document was, in my view, enough to constitute fraud. That finding did not depend upon direct evidence that might have been given by the registration clerk as to her state of mind. Fraud was a priori. I agree with the learned trial judge's conclusion: "This was fraud in the sense I have discussed committed by Ms Moore. She altered the transfer from the Corporation to Mr and Williams, after the transfer had been executed, by crossing out the words "as joint tenants" and inserting the words "tenants in common in equal shares". She knew that this did not represent the transaction between the Corporation and Mr and Mrs Williams and she expected the Registrar-General to act upon the alteration, as in fact occurred. She took that course for the purpose of saving a small amount of stamp duty. Nevertheless, she deliberately altered the transfer with the intention that the Registrar-General would act upon her alterations. Her conduct amounted to fraud for the purposes of the Act." 254 The second issue is whether, if I am correct in my view that there was fraud on the part of the registration clerk, it was fraud for which the deceased was answerable. 255 In order to invalidate the title of the deceased as registered proprietor the fraud of the registration clerk must be brought home to the deceased or to his agent, his solicitor (Mere Roihi at 210). 256 In the situation where fraud is committed by the person whose title is impeached or his agents, the principle of respondeat superior applies and the matter is to be tested by investigating whether or not the principal, in the particular circumstances, is liable to the person who has been defrauded for the acts of the agent (Schultz v Corwill Properties Ltd (1969) 90 WN (Pt 1) (NSW) 529 at 537). 257 In his extensive analysis of the authorities in Conlan v Registrar of Titles (2001) 24 WAR 299, Owen J at 345 referred approvingly to what Batt JA had said in Russo at 392 with respect to the bringing home to the registered proprietor or his agents of the fraud: "That means that it must be sheeted home to the registered proprietor or his agents, that he or they must be shown to be infected by it or complicit in it." Batt JA went on to find that the agent's employee's fraud could not be sheeted home to the agent or his principal. The registering party was neither complicit in nor aware of the fraud and it was too remote from the registering party to affect him. 258 On the other hand, Ormiston JA in Russo took a different view, a view regarded as important by Owen J in Conlan. At 390 Ormiston JA said: "…I would have found it hard to reach a conclusion that the bank should not be responsible for the acts of its solicitor in circumstances such as the present, if fraud had been established, assuming the fraud in question not to have been for his own benefit. He was engaged to act as the bank's solicitor and to advise it in relation to the very transaction, that is, what was thought to be a mortgage by the appellant in favour of the bank…If he had consciously gone forward and obtained registration of the mortgage in the knowledge of, or wilfully blind to, the fact only that it was not properly attested, then I doubt that would have involved him doing something outside the scope of his authority. If he had been party to the lodging of the documents (which is not clear), then he would be doing so in order to carry out the instructions of his client, the bank, and it was only by chance that the document was not properly executed or attested. The same reasoning would apply if Miss Gerada were to be held (contrary to my opinion) to have been guilty of fraud on the same limited basis." 259 In my view that approach should be adopted in the instant circumstances. The solicitor was engaged to act for the deceased in the very transaction, lodgement of the transfer for registration. If she had consciously gone forward and obtained registration of the transfer in the knowledge of, or wilfully blind to, the fact that it had been altered after execution, she would not have been involved in doing something outside the scope of her authority. If she had been party to the lodgement of the transfer she would have been doing so in order to carry out the instructions of the deceased. It was only by chance that the document had been altered improperly. 260 Kooragang Investments Pty Ltd v Richardson & Wrench Ltd [1982] AC 462 involved a different question: whether the employee had authority to give valuations on behalf of his employer. Here there is no question of the solicitor's retainer or that of the registration clerk. 261 Likewise, BNP Paribas v Pacific Carriers Ltd [2002] NSWCA 379 does not assist the first claimant. It concerned the question whether the employee of the bank had authority to bind the bank to a contract of indemnity. 262 In my opinion, the fraud of the registration clerk was brought home to the solicitor, the agent of the registered proprietor. The act of the registration clerk, although improper, was a mode of doing the very thing that she was authorised to do. 263 As Gleeson CJ said in New South Wales v Lepore (2003) 77 ALJR 558 at 569 quoting from Salmond, Law of Torts: "an employer is liable even for unauthorised acts if they are so connected with authorised acts that they may be regarded as modes - although improper modes - of doing them, but the employer is not responsible if the unauthorised and wrongful act is not so connected with the authorised act as to be a mode of doing it, but is an independent act." 264 I agree with Davies AJ when he said: "Ms Moore was a registration clerk. She was employed through Ms Pinter to act on Mr Williams' behalf in the stamping and lodgement of the transfer from the Corporation to Mr and Mrs Williams. The fraud which she committed was not authorised, but it was fraud committed in the course of and for the purposes of the transaction which Ms Moore was employed to do. Her fraud was fraud for which Mr Williams was responsible, it having been carried out by his agent in the course of her employment and, if it were necessary to add, for his benefit." 265 The third issue is what flows from this view of the matter. In my view, the first opponent is entitled to a declaration that the registration of the transfer of the land was procured by fraud within the meaning of the Real Property Act 1900, s 42 and was thereby void as against her. 266 However, statutory fraud is not of itself directly generative of legal rights and obligations. Its role is to qualify the operation of the doctrine of indefeasibility upon what would have been the rights and remedies of the parties if the land were held under unregistered title (Bank of South Australia Ltd v Ferguson (1998) 192 CLR 248 at 256). 267 The competing equities between the parties and the unsatisfactory nature of the way in which the trial proceeded before the primary judge, are discussed in the reasons for judgement of Young CJ in Eq. In my view, the matter should be remitted to the court below for those issues to be determined. I regard the first opponent as having been substantially successful on the appeal. Accordingly, I would propose the following orders: (1) Appeal allowed in part. (2) Orders made by Davies AJ be set aside. (3) Declare that the registration of a transfer of the whole of the land in Certificate of Title volume 13400 folio 121 dated 8 January 1987 under dealing number U313855R was, as against Ivy Gladys Williams, procured by fraud within the meaning of the Real Property Act 1900, s 42(1) and is thereby void as against her. (4) Otherwise remit the proceedings to the Equity Division for further hearing and determination. (5) Order that the first claimant pay the first opponent's costs both of the trial before Davies AJ and of this appeal. (6) First claimant to have a certificate under the Suitors' Fund Act if qualified. ********************** Last Modified: 12/17/2003 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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