Purchase of registered land from a mortgagee exercising his power of sale.

(a) See stat. 60 & 61 Vict. c. 65, s. 24; above, p. 370.

(b) Stat. 38 & 39 Vict. c. 87, s. 2. But if at any time land is found to have been registered with absolute or qualified title contrary to the provisions of this section, the registration shall not be annulled, but shall be deemed an error not capable of rectification under the Principal Act, and any person suffering loss thereby shall be indemnified accordingly; stat. 60 & 61 Vict. c. 65, First Schedule.

(c) Stat. 38 & 39 Vict. c. 87, s. 67; Land Transfer Rules (1903), 87.

(d) Above, p. 370 & n. (n).

(e) Stat. 38 & 39 Vict. c. 87, s.82; Land Transfer Rules(1903), 71; above, p. 1105.

(f) Above, p. 1067.

In the first of these cases all that has to be ascertained from the register is that the incumbrance is duly registered, as alleged, so as to remain paramount to the effect of first registration with an absolute title and of registered transfers of the land (k). This done, the investigation of the title will be conducted in the same manner exactly as if the land were not registered (l); the same points being particularly attended to as on a purchase of unregistered land from a mortgagee exercising his power of sale (m). But the assurance of the land sold to the purchaser and the completion of the contract present some difficulty, owing to the fact that the land is registered in the proprietorship of the mortgagor, or his successor in estate, who presumably is no party to the contract. We will suppose that the purchaser is buying under an open contract and that the land sold is situated in a district where registration on sale is compulsory (n). As the vendor is selling an estate paramount to the title of the registered proprietor and entirely unaffected by the registration, it is at least questionable whether he is a vendor of registered land within the meaning of sect. 16 of the Land Transfer Act, 1897 (o): but it is submitted that he is, since the land sold is in fact already registered, and the vendor cannot, by conveyance under his power of sale, confer a title under which an application can be made for registration as first proprietor of the land (p). If this suggestion be correct, the vendor will be bound, at the purchaser's request and at his own expense, and notwithstanding any stipulation to the contrary, either to procure the registration of himself as proprietor of the land, or of the incumbrance, under which he is selling, or to procure a transfer from the registered proprietor to the purchaser (q). And if the sale be not regulated by the above enactment, it is thought that, under an open contract, the vendor would nevertheless be bound to procure the purchaser's registration as proprietor of the land: otherwise, although it appears that the purchaser would obtain the legal estate (r), there would remain outstanding the registered proprietor's interest with the powers of disposition incident thereto (s). But in this event the purchaser would have to bear the expense of such registration, except that of any acts to be done for this purpose by the vendor himself or any other necessary party, such as the registered proprietor of the land (t). The sale should, it is thought, be completed by an unregistered assurance of the estate sold to the purchaser, in which the vendor should covenant against incumbrances (u), followed by the registration of the purchaser as proprietor of the land: but the purchaser should not pay the price until he has acquired a clear right to be registered as proprietor and is satisfied that his registration will relate back to the time of payment (x). The purchaser can only obtain this right in three ways. Either the registered proprietor of the land must at the vendor's request execute a registered transfer to the purchaser; in which case the purchaser must of course ascertain that the proprietor's title is unincumbered, or that all incumbrancers concur in the transfer (y). Or the vendor must procure himself to be registered as proprietor of the incumbrance, under which he is selling, when he will acquire the statutory power to transfer the land sold in exercise of his power of sale (z), and will be enabled to exercise the same in the purchaser's favour. Or proceedings must be taken under the Land Transfer Rules (1903), No. 151 (a), to procure the purchaser's registration as proprietor of the land. It is thought that the purchaser is entitled, in one way or another, to have the land sold transferred into his own registered proprietorship; and he should insist on obtaining this. If the vendor procure a transfer from the registered proprietor and all other necessary parties, or procure himself to be registered as proprietor of the incumbrance and then transfer to the purchaser, the purchase money may be paid, after a priority notice has been obtained in favour of the transfer to the purchaser, on the execution of the unregistered assurance and the instrument of transfer to the purchaser and on delivery of the land certificate (b), or, where the vendor has been registered as proprietor of the incumbrance, of the certificate of incumbrance (c), with the priority notice endorsed thereon (d). But if application be made under rule 151 to have the purchaser's name entered as proprietor of the land, it is thought that he should not part with the purchase money until the registrar has directed the required entry to be made; for until then the purchaser has no absolute right to be so registered, and he cannot be assured that the application will be granted (e). The question, what searches should be made, also depends on the manner in which the purchaser's registration is to be effected. If he is to obtain a transfer from the registered proprietor of the land and all other necessary parties (the incumbrance being expunged from the register (f), or from the vendor when registered as proprietor of the incumbrance under which the sale is made, it appears that the effect of the transfer, when registered, will relieve him from the necessity of making any searches outside the Office of Land Registry, except in Bankruptcy (g). But if application for the purchaser's registration is to be made under rule 151 (h), the same searches should be made as upon the sale of unregistered land (i); for the purchaser's claim to be so registered must be proved to the registrar's satisfaction (h).