Apart from statute the distinction between the legal estate in land and merely equitable interests is fundamental, and the question of priority as between different claims relating to land depends upon (1) the possession of the legal estate, and (2) the order in which the claims are created, unless a person otherwise entitled to priority is estopped from asserting it (g).

Under the system of registration of deeds some inroad is made upon the importance of the distinction between the legal estate and equitable interests in that priority, as a general rule, depends not upon the order in which claims are created but upon that in which they are registered. In other respects, however, the legal effect of an instrument is not affected by the fact that it is or is not registered (h).

Under the land titles system in force in Manitoba, Saskatchewan, Alberta and the Northwest Territories (i) not merely does priority of registration prevail, as a general rule, but an instrument becomes fully effective only upon registration (j), so as to pass any estate or interest as against a transferee in good faith (k) or except as against the person executing the instrument (I). The old distinction between the legal estate and equitable interests therefore gives place to a new and fundamental distinction between the registered or statutory estate and unregistered or equitable interests.

The result of the registration of a title is to create in favour of the holder of a certificate of title a statutory estate, which may conveniently be called the "registered estate," which is analogous to the legal estate but is not necessarily identical with it (m) and does not necessarily involve the same consequences. " In short, the register of proprietors is not material for the purpose of ascertaining where the legal estate is. The transfer by registered disposition takes effect by virtue of an overriding power, and not by virtue of any estate in the registered proprietor" (n).

(g) See chapter 7, Equitable Principles governing Priorities.

(h) See chapter 8, The Registry Act, Sec. 77.

(i) The statutory references given hereunder are to the statutes mentioned in Sec. 93.

(j) Man. s. 89; Sask. ss. 54, 63; Alta. ss. 23, 41; N.W.T. ss. 76, 77; B.C. ss. 104, 73. Cf. Thorn, The Canadian Torrens System, pp. 89, 90.

(k) Man. s. 91; Alta. s. 46; N.W.T. s. 70.

(l) Sask. s. 58.

The certificate of title under the Manitoba statute reads:

A.B., of------is now seized of an estate (state nature of estate), subject to such encumbrances, liens and interests as are notified by memorandum underwritten (or endorsed hereon), in that piece or parcel of land known or described as follows:

Under the Saskatchewan, Alberta and Northwest Territories statutes the certificate reads:

This is to certify that A.B., of ------ is now the owner of an estate (describe the estate), of and in (describe the property), subject to the encumbrances, liens and interests notified by memorandum underwritten or endorsed hereon, or which may hereafter be made in the register.

An ordinary registered title under these statutes resembles an "absolute" title under the Ontario statute (o) and an "indefeasible" title under the British Columbia statute (p). The Ontario statute also provides in the alternative for the registration of a "qualified" title or of a " possessory" title-the latter being merely the title of a person in possession as distinguished from that of a person having a title by possession

(m) Land may be brought under the act and a registered estate created, although the land is subject to mortgage, so that the legal estate is outstanding in the mortgagee. Cf. Thorn, The Canadian Torrens System, pp. 122, 123.

(n) Capital and Counties Bank v. Rhodes, [1903] 1 Ch. 631, at p. 655.

(o) Ont. ss. 9, 10, 43, 44.

(p) B.C. ss. 2, 22.

(q). The British Columbia statute also provides for the registration of an "absolute" title, that is, the title of a person prima facie entitled which may upon certain conditions be subsequently converted into an "indefeasible" title (r).

The expression "certificate of ownership" is used in the Ontario statute in a different sense from that in which the expression " certificate of title "is used in the Manitoba, Saskatchewan, Alberta, and Northwest Territories statutes. Under the latter group of statutes the "certificate of title" is bound in and forms part of the register. It is customary to deliver to the registered owner a "duplicate certificate of title," that is, an exact replica of the certificate in the register, and it is regarded as important that when an entry is made upon the certificate in the register a similar entry should be made upon the duplicate certificate (s). Under the Ontario statute, on the other hand, the only certificate of ownership is the document which is delivered to the registered owner if he requires it (t) and which is merely prima facie evidence of the matters therein contained (u). Some of the difficulty of comparing the provisions of the Ontario statute with those of the other statutes above mentioned disappears if it is remembered that either the "register" or the "certificate of title" under the latter statutes corresponds with the " register" and not with the "certificate of ownership" under he former statute.

As a general principle it may be stated that a transferee or mortgagee from the registered owner need not go behind the register and takes free from unregistered interests (v).

(q) Ont. ss. 11, 12, 13.

(r) Cf. Thom, The Canadian Torrens System, pp. 24 ff., 66.

(s) Cf. Thom, The Canadian Torrens System, 58-60. See also Sec. 95, as to registration of mortgages.

(t) Ont. s. 38.

(u) Ont. s. 91.

(v) In addition to the statement of the qualifications of the general principle which follows in the text, see further the statutory a third party who seeks a declaration that the letters patent are void as having been issued through fraud or in error or improvidence (a).

Under the Ontario statute a tranfer of land by the regis-istered owner is completed by the entry of the transferee on the register as owner (w), and it is provided as follows (x):

42. A transfer for valuable consideration (y) of land registered with an absolute title, when registered, shall confer on the transferee an estate in fee simple in the land transferred, together with all rights, privileges, and appurtenances belonging or appurtenant thereto, subject to:

(a) The encumbrances, if any, entered or noted on the register.

(b) Such liabilities, rights and interests, if any, as are declared for the purposes of the Act not to be encumbrances (z) unless the contrary is expressed on the register;

And as to such rights, privileges and appurtenances, subject also to any qualification, limitation or encumbrance to which the same are expressed to be subject in the register, or where such rights, privileges and appurtenances are not registered, then subject to any qualification, limitation or encumbrance to which the same are subject at the time of the transfer; but free from all other estates and interests whatsoever, including estates and interests of His Majesty, which are within the legislative jurisdiction of Ontario.

This section confers upon a transferee for value higher rights than are conferred upon the first registered owner by s. 10, by which it is provided that "where such first registered owner is not entitled for his own benefit to the land registered, then as between him and any persons claiming under him," he takes subject "to any unregistered estates, rights, interests, or equities to which such persons may be entitled." Under s. 42 a transferee for value without notice from the first registered owner takes free from the claim of references contained in Sec. 95, infra. On the question to what extent registered and equitable interests may be valid, sec Sec. 97, infra. As to the main object of the land titles system, namely, to protect purchasers in good faith from the registered owner, see Sec. 92.

(w) Ont. s. 38.

(x) Ont. s. 42.

(y) As to the effect of absence of consideration, see Sec. 97, infra.

(z) Inter alia, taxes, easements, a lease for a period yet to run not exceeding three years where there is actual occupation under it, dower, curtesy and mechanics liens, as provided by s. 24.

Under the Manitoba, Saskatchewan, Alberta and Northwest Territories statutes, a certificate of title is conclusive evidence (b) that the person named therein is entitled to the land described therein for the estate or interest therein specified,

(1) Subject to the exceptions or reservations mentioned in the statute (c),

(2) Subject to the encumbrances, liens, estates or interests notified on the register (d),

* (3) Free from all other encumbrances, liens, estates or interests whatsoever except in case of fraud wherein he has participated or colluded.

The difficult question of fraud as affecting the title of a registered owner is involved with that as to the effect of a person taking with notice of the claims of third parties, and will be mentioned later (e).