25 Protection Of Registered Owner Against Actions For Recovery Of Land

CROSS REFERENCES AND OTHER SOURCES OF INFORMATION

See Di Castri, Registration of Title to Land, vol. 2, para. 756.

CASE LAW

Purpose and Application

See the annotation for Pacific Savings and Mortgage Corp. v. Can-Corp Development Ltd., 1982 CanLII 463 (BC CA) under s. 23 of the Act (General).

Actions Limited to Section 25(2) Exemptions

As a result of an error, the registrar registered a deed and issued a certificate of title when the duplicate certificate of title was out. Section 383 of the Act regarding the registrar’s corrective authority did not help the rightful owner. Once the registrar signed the certificate of indefeasible title, the rightful owner could only recover the land if he fit the exceptions in s. 25(2) (Heller v. Registrar, Vancouver Land Registration District and Heller, 1960 CanLII 292 (BC CA), affirmed 1963 CanLII 39 (SCC); see also the annotation for this decision under s. 383 of the Act).

Fraud

The fraud referred to in s. 23 (and in s. 25(2)(c), prior to its repeal in 2005) is actual, not constructive, fraud, as where one buys land with actual or imputed knowledge that the vendor is not the owner (Greveling v. Greveling, 1949 CanLII 233 (BC CA); see also the annotation of this and other cases on actual and constructive notice in relation to fraud under s. 29 of the Act).

The plaintiff and defendant, common law spouses, purchased a home. To obtain mortgage financing, they registered title in the names of the plaintiff’s parents. Two years later, following the breakdown of the common law relationship, the defendant commenced an action against the plaintiff’s parents to recover a one-half interest in the property. During the course of those proceedings, the plaintiff signed a letter verifying that he had no further interest in the property. As a consequence of those proceedings, including the award of costs against the plaintiff’s parents, the defendant became the registered owner of the property. Almost nine years later, the plaintiff brought this action seeking a declaration that the defendant held an undivided one-half interest in the property for the plaintiff. The court found no evidence that either the defendant or the plaintiff’s parents committed a fraud on the plaintiff. Over the nine-year period, the plaintiff took no steps to advance his claim to the property. Sworn financial statements, prepared by the plaintiff during this period in connection with other proceedings, included no reference to the plaintiff’s interest in the property, and neither the plaintiff nor his parents refuted the defendant’s claim to the property. The defendant’s conduct showed no element of dishonesty. No facts were brought to the defendant’s attention that the plaintiff claimed an interest in the property and the defendant needed to make inquiries; that the defendant’s suspicions should have been aroused; that the defendant abstained from making inquiries for fear of learning the truth; or that the defendant had any knowledge of facts that would render the purchase a fraud on the plaintiff. As a consequence, the defendant had no actual or constructive knowledge of the plaintiff’s interest that would allow the court to void the transfer. In dismissing the plaintiff’s claim, the court was satisfied that the defendant’s claim to the protection of ss. 23, 25, 29, and 297 of the Act did not constitute a fraud against the plaintiff (Garbutt v. Burbank, 2000 BCSC 14).

Trusts

An action for a declaration that the registered owner of property holds it at least partially in trust for another is not the type of action contemplated by s. 25(3). Such an action is not barred by this section (Gillson v. Gillson, 1961 CanLII 624 (BC SC)).

A beneficiary is entitled to bring an action for an accounting when the trustee of a resulting trust fraudulently seeks to keep land conveyed to the trustee by the beneficiary and registered in the trustee’s name (Moore v. Moore, 1970 CanLII 850 (BC CA)).

For further cases involving trusts and the indefeasibility of titles, see the annotations under s. 23 of the Act (General).