Law of Property Act 1936 (SA)

South Australia Law of Property Act 1936 An Act to consolidate and amend certain Acts relating to property and conveyancing. Contents Part 1—Preliminary 1 Short title 4 Repeal 5 Savings 6 Application of Act to land under Real Property Act 1886 7 Interpretation Part 2—General rules affecting property 8 Lands lie in grant only 9 Use of word "grant" unnecessary 10 Power to dispose of all rights and interests in land 11 Lis pendens to be registered 12 Tenant for life without impeachment of waste, not to commit equitable waste 13 No merger at law where none in equity 14 Suits for possession of land by mortgagors 15 Assignment of debts and choses in action 16 Stipulations not of the essence of a contract 17 Satisfied terms, whether created out of freehold or leasehold land, to cease 18 Vesting order consequential on judgment for sale or mortgage of land 19 Vesting order consequential on judgment for specific performance etc 20 Rights of pre-emption capable of release 21 Purchaser not to be concerned with the trusts of the proceeds of sale 22 Right of light not deemed to exist by reason only of enjoyment or presumption of lost grant 23 Gift not to be avoided by illegal stipulation attached thereto 24 Alien friends may hold real and personal property 24A Certain contracts with infants for the repayment of loans to be valid 24B Abolition of doctrine of interesse termini 24C Body corporate may hold property as joint tenant 24D Capacities of corporations 25 Contingent remainders protected against the premature failure of a preceding estate Part 3—General rules affecting contracts, conveyances, and other instruments 26 Contracts for sale of land to be in writing 27 Discharge of incumbrances by the Court on sales or exchanges 28 Conveyances to be by deed 29 Instruments required to be in writing 30 Creation of interests in land by parol 31 Savings in regard to last two sections 32 Effect of possession of documents 33 Interests of persons in possession 34 Persons taking who are not parties and as to indentures 35 Conditions and certain covenants not implied 36 General words implied in conveyances 37 All estate clause implied 38 Partial release of security from rent-charge 39 Release of part of land affected from a judgment 40 Conveyances by a person to self etc 41 Execution and attestation of deeds 41AA Execution and attestation of other instruments 41A Easements without dominant land to be validly created 42 Covenants for title Part 4—Mortgages 43 Realisation of equitable charges by the court 44 Sale of mortgaged property in action for redemption or foreclosure 45 Obligation to transfer instead of reconveying 46 Vesting order in place of conveyance by devisee of mortgagee 47 Powers incident to estate or interest of mortgagee 48 Regulation of exercise of power of sale 49 Conveyance on sale 50 Application of proceeds of sale 51 Provisions as to exercise of power of sale 52 Mortgagee's receipts, discharges etc 53 Appointment, powers, remuneration and duties of receiver 54 Effect of advance on joint account 55 Notice of trusts affecting mortgage debts 55A Enforcement of rights against mortgagor 55B Collateral covenants 56 Application to registered land Part 5—Powers 57 Disclaimer etc of powers 57A Validation of appointments where objects are excluded or take illusory shares 58 Execution of powers not testamentary Part 6—Class closure, perpetuities and accumulations Division 1—Preliminary 58A Interpretation and jurisdiction 59 Application of Part Division 2—Rules for class ascertainment 60 Class ascertainment 60A Court's power to reverse statutory limitation on class membership Division 3—Perpetuities and accumulations 61 Abolition of rules against perpetuities and excessive accumulations 62 Court may order vesting of interests 62A Preservation of rule in Saunders v Vautier Part 7—Apportionment 63 Definitions 64 Apportionment of rents in respect of time 65 When apportioned part payable or recoverable 66 Right of recovering apportioned parts 67 Policies of assurance 68 Contracting out Part 8—Partition 69 Power to order partition or sale instead of partition 70 Sale on application of certain proportion of parties interested 71 As to purchase of share of party desiring sale 72 Notice to interested parties 73 Proceedings where service is dispensed with 74 Authority for parties interested to bid 75 Court to declare what parties are trustees of lands comprised in any suit, and as to the interests of persons unborn 76 Payment and application of moneys arising from settled land 77 Trustees may apply moneys in certain cases without application to court 78 Until money directed to be applied it is to be invested and dividends to be paid to parties entitled 79 Court may direct application of money in respect of leases or reversions as may appear just 80 Interpretation of settled land 81 Provision for case of successive sales in same auction 82 Request by infant or person under disability 83 Application for partition to include application for sale and distribution of the proceeds 84 Costs Part 9—Voidable dispositions 86 Voluntary conveyances to defraud creditors 87 Voluntary disposition with intent to defraud voidable as against purchasers 88 Acquisitions of reversions at an under value Part 10—Miscellaneous 89 Vesting order in lieu of conveyance 90 Vesting order in cases of mentally incapacitated or infant mortgagee 91 In what cases the heir, representative, or devisee of a person, who has contracted to sell land, shall be deemed a trustee 100 Assurance policy by spouses 108 Interpretation of terms 110 Invalidity of restraints upon anticipations 112 Regulations respecting notices 114 Power of Court to sell interest of Crown in real estate 116 Definition of intestacy 117 Restrictions on constructive notice 118 Lessor to have benefit of an informal insurance 119 Payment into court 120 Saving of certain rights of the Crown Schedule 1—Acts repealed Schedule 2—Implied covenants 1 Covenant implied in a conveyance for valuable consideration, other than a mortgage, by a person who conveys and is expressed to convey as beneficial owner 2 Further covenant implied in a conveyance of leasehold property for valuable consideration, other than a mortgage, by a person who conveys and is expressed to convey as beneficial owner 3 Covenant implied in a conveyance by way of mortgage by a person who conveys and is expressed to convey as beneficial owner 4 Covenant implied in a conveyance by way of mortgage of leasehold property by a person who conveys and is expressed to convey as beneficial owner 5 Covenant implied in a conveyance by way of settlement, by a person who conveys and is expressed to convey as settlor 6 Covenant implied in any conveyance, by every person who conveys and is expressed to convey as trustee or mortgagee, or as personal representative of a deceased person, or as administrator, committee or other person empowered to act on behalf of a mentally incapacitated person or under an order of the court Legislative history The Parliament of South Australia enacts as follows: Part 1—Preliminary 1—Short title This Act may be cited as the Law of Property Act 1936. 4—Repeal The Acts mentioned in Schedule 1 of this Act are repealed to the extent shown in that Schedule. 5—Savings Any alteration, by this Act, of the law, whether by the repeal of an enactment, or otherwise, shall not, unless otherwise expressly provided by this Act affect— (a) any right accrued, or obligation incurred, before the commencement of this Act under the law so altered; or (b) the validity or invalidity, or any operation, effect or consequence of any instrument executed or made, or of anything done or suffered before the commencement of this Act; or (c) any action, proceeding or thing then pending or uncompleted and every such action, proceeding and thing may be carried on and completed as if the enactment had not been repealed, or the law otherwise altered. 6—Application of Act to land under Real Property Act 1886 Except as in this Act expressly provided, this Act, so far as inconsistent with the Real Property Act 1886 shall not apply to land which is under the provisions of that Act. 7—Interpretation In this Act unless inconsistent with the context or subject-matter or some other meaning is clearly intended— bankruptcy includes insolvency and liquidation by arrangement and also any other act or proceeding in law having under any law for the time being in force effects or results similar to those of bankruptcy; building purposes includes the erecting and improving of and the adding to, and the repairing of buildings; and a building lease is a lease for building purposes or purposes connected therewith; conveyance includes a mortgage, charge, lease, assent, vesting declaration, disclaimer, release, surrender, extinguishment and every other assurance of property or of an interest therein by any instrument, except a will; convey has a corresponding meaning; court means— (a) the Supreme Court; or (b) the District Court; or (c) if the proceedings involve property with a value not exceeding the amount by reference to which the jurisdictional limit of the Magistrates Court is fixed for actions to obtain or recover title to, or possession of, real or personal property—the Magistrates Court; disposition includes a conveyance and also a devise, bequest, or an appointment of property contained in a will; and dispose of has a corresponding meaning; income includes rents and profits; incumbrance includes a legal or equitable mortgage and a trust for securing money, and a lien, and a charge of a portion, annuity, or other capital or annual sum; and incumbrancer has a meaning corresponding with that of incumbrance, and includes every person entitled to the benefit of an incumbrance, or to require payment or discharge thereof; instrument includes deed and will but does not include a statute, unless the statute creates a settlement; interest in property means a legal or equitable interest; land includes land of any tenure, and mines and minerals whether or not held apart from the surface, buildings or parts of buildings (whether the division is horizontal, vertical or made in any other way) and other corporeal hereditaments; also a rent and other incorporeal hereditaments, and an easement, right, privilege, or benefit in, over, or derived from the land and also an undivided share in land; and mines and minerals include any strata or seam of minerals or substances in or under any land, and powers of working and getting the same; limitation includes a trust; mentally incapacitated person has the same meaning as in the Guardianship and Administration Act 1993; mining lease means a lease for mining purposes, that is the searching for, winning, working, getting, making merchantable, carrying away, or disposing of mines and minerals, or purposes connected therewith, and includes a grant or licence for mining purposes; mortgage includes any charge or lien on any property for securing money or money's worth; mortgage money means money or money's worth secured by a mortgage; mortgagor includes any person from time to time deriving title under the original mortgagor or entitled to redeem a mortgage according to his estate interest or right in the mortgaged property; mortgagee includes any person from time to time deriving title under the original mortgagee; and mortgagee in possession is, for the purposes of this Act, a mortgagee who, in right of the mortgage, has entered into and is in possession of the mortgaged property; and right of redemption includes an option to repurchase only if the option in effect creates a right of redemption; notice includes constructive notice; personal representative means the executor, original or by representation, or administrator for the time being of a deceased person; possession includes receipt of rents and profits or the right to receive the same (if any); property includes any thing in action, and any interest in real or personal property; purchaser means a purchaser in good faith for valuable consideration and includes a lessee, mortgagee or other person who for valuable consideration acquires an interest in property except that where so expressly provided purchaser means a person only who acquires an interest in or charge on property for money or money's worth; and where the context so requires purchaser includes an intending purchaser; purchase has a meaning corresponding with that of purchaser; and valuable consideration includes marriage but does not include a nominal consideration in money; registered land means land which is subject to the Real Property Act 1886; and registrar means the Registrar-General under that Act; rent includes a rent service or a rent charge, or other rent toll, duty, royalty, or annual or periodical payment in money or money's worth, reserved or issuing out of or charged upon land, but does not include mortgage interest; rent charge includes a fee farm rent; fine includes a premium or foregift and any payment consideration, or benefit in the nature of a fine, premium or foregift; lessor includes an under-lessor and a person deriving title under a lessor or under-lessor; and lessee includes an under-lessee and a person deriving title under a lessee or under-lessee, and lease includes an under-lease or other tenancy; representative means an executor or administrator, and includes the Public Trustee in cases where the Supreme Court shall have authorised him to administer the estate of a deceased person; sale means a sale properly so called; securities include stocks, funds and shares; trust for sale in relation to land, means an immediate binding trust for sale, whether or not exercisable at the request or with the consent of any person, and with or without a power at discretion to postpone the sale; trustees for sale means the persons (including a personal representative) holding land on trust for sale; and power to postpone a sale means power to postpone in the exercise of a discretion; vest, in relation to property, means to vest in interest or possession. Example— For example, an interest in remainder vests in interest when— (a) the persons who are to take the interest are ascertainable; and (b) the vesting in possession of the interest is dependent only on the determination of prior interests and no other contingency. Part 2—General rules affecting property 8—Lands lie in grant only All lands and all interests therein shall lie in grant and shall be incapable of being conveyed by livery or livery and seisin, or by feoffment, or by bargain and sale; and a conveyance of an interest in land may operate to pass the possession or right to possession thereof, without actual entry, but subject to all prior rights thereto. 9—Use of word "grant" unnecessary The use of the word "grant" is not necessary to convey land or to create any interest therein. 10—Power to dispose of all rights and interests in land All rights and interests in land may be disposed of, including— (a) a contingent, executory, or future interest in any land, or a possibility coupled with an interest in any land, whether or not the object of the gift or limitation of such interest or possibility be ascertained; (b) a right of entry, into or upon land whether immediate or future, and whether vested or contingent. 11—Lis pendens to be registered No lis pendens shall bind any bona fide purchaser or mortgagee for valuable consideration without express notice thereof, unless and until it is registered under the Registration of Deeds Act 1935 by delivering to the Registrar-General of Deeds a memorial containing the title of the cause or matter, and the name and address of the persons whose estate or interest is sought to be affected thereby; and every such memorial shall be signed by the solicitor of one of the parties to the cause or matter, or of some person claiming to be entitled to deliver such memorial. 12—Tenant for life without impeachment of waste, not to commit equitable waste An estate for life, without impeachment of waste, shall not confer upon the tenant for life any legal right to commit waste of the description known as equitable waste, unless an intention to confer such right expressly appears by the instrument creating such estate. 13—No merger at law where none in equity There shall not be any merger by operation of law only of any estate, the beneficial interest in which would not be deemed to be merged or extinguished in equity. 14—Suits for possession of land by mortgagors A mortgagor entitled for the time being to the possession or receipt of the rents and profits of any land, as to which no notice of his intention to take possession or to enter upon the receipt of the rents and profits thereof has been given by the mortgagee, may sue for such possession, or for the recovery of such rents or profits, or to prevent or to recover damages in respect of any trespass or other wrong relative thereto, in his own name only, unless the cause of action arises upon a lease or other contract made by him jointly with any other person. 15—Assignment of debts and choses in action (1) Any absolute assignment by writing under the hand of the assignor (not purporting to be by way of charge only) of any debt or other legal chose in action, of which express notice in writing has been given to the debtor, trustee, or other person from whom the assignor would have been entitled to receive or claim such debt or chose in action, shall be effectual in law (subject to equities having priority over the right of the assignee), to pass and transfer from the date of such notice— (a) the legal right to such debt or chose in action; and (b) all legal and other remedies for the same; and (c) the power to give a good discharge for the same, without the concurrence of the assignor. (2) However, if the debtor, trustee, or other person liable in respect of such debt or chose in action has notice— (a) that such assignment is disputed by the assignor, or any person claiming under him; or (b) of any other opposing or conflicting claims, to such debt or chose in action, he may, if he thinks fit, either call upon the persons making claim thereto to interplead concerning the same, or pay the debt or other chose in action into court, under the provisions of the Trustee Act 1936. 16—Stipulations not of the essence of a contract Stipulations in a contract, as to time or otherwise, which according to rules of equity are not deemed to be or to have become of the essence of the contract, shall be construed and have effect at law in accordance with the rules of equity. 17—Satisfied terms, whether created out of freehold or leasehold land, to cease (1) Where the purposes of a term of years, created or limited at any time out of freehold land, become satisfied (whether or not that term either by express declaration or by construction of law becomes attendant upon the freehold reversion), that term of years shall merge in the reversion expectant thereon and shall cease accordingly. (2) Where the purposes of a term of years, created or limited at any time out of leasehold land, become satisfied, that term shall merge in the reversion expectant thereon and cease accordingly. (3) Where the purposes are satisfied as respects part only of the land comprised in a term, this section has effect as if a separate term had been created in regard to that part of the land. 18—Vesting order consequential on judgment for sale or mortgage of land Where the court gives a judgment, or makes an order directing the sale or mortgage of land, every person, whether under disability or not, who is entitled to or possessed of the land, or entitled to any interest therein, and is a party to the action or proceeding, or otherwise bound by the judgment or order, shall be deemed to be so entitled or possessed, as the case may be, as a trustee within the meaning of the Trustee Act 1936; and the court may, if it thinks expedient, make an order vesting the land, or any part thereof, for such estate as the court thinks fit in the purchaser or mortgagee, or in any other person. 19—Vesting order consequential on judgment for specific performance etc Where a judgment is given for the specific performance of a contract concerning any land, or for the partition, or sale in lieu of partition, or exchange of any land, or generally where any judgment is given for the conveyance of any land, either in cases arising out of the doctrine of election or otherwise, the court may declare that any of the parties to the action are trustees of the land, or any part thereof, within the meaning of the Trustee Act 1936 or may declare that the interests of unborn persons who might claim under any party to the action, or under the will or voluntary settlement of any person deceased who was during his lifetime a party to the contract or transactions concerning which the judgment is given, are the interests of persons who, on coming into existence, would be trustees within the meaning of the Trustee Act 1936; and thereupon the court may make a vesting order relating to the rights of those persons, born and unborn, as if they had been trustees. 20—Rights of pre-emption capable of release All statutory and other rights of pre-emption affecting a legal estate shall be and be deemed always to have been capable of release. 21—Purchaser not to be concerned with the trusts of the proceeds of sale A purchaser of a legal estate from trustees for sale shall not be concerned with the trusts affecting the proceeds of sale of land subject to a trust for sale or affecting the rents and profits of the land until sale, whether or not those trusts are declared by the same instrument by which the trust for sale is created. 22—Right of light not deemed to exist by reason only of enjoyment or presumption of lost grant (1) After the twenty-sixth day of October, 1911, no right to the access or use of light to or for any building shall be capable of coming into existence by reason only of the enjoyment of such access or use for any period of time, or of any presumption of a lost grant based upon such enjoyment. (2) This section shall not affect any right actually acquired before the said date. 23—Gift not to be avoided by illegal stipulation attached thereto (1) No gift, whether by testamentary disposition or by instrument inter vivos, shall be held to be void solely on the ground that the testator or donor has attached an illegal stipulation to such gift, whether such stipulation is in the nature of a limitation of the gift or of a condition precedent or subsequent to the gift, unless it is proved to the satisfaction of the court before which the matter is in question that the donee of such gift consented to such stipulation at or before the time when the testamentary disposition or instrument inter vivos was executed by the testator or donor. (2) Unless it is proved as aforesaid, in construing the testamentary disposition or instrument inter vivos, the gift shall be read as if the illegal stipulation had not been attached thereto. 24—Alien friends may hold real and personal property Every alien friend may inherit, or otherwise take by representation, acquire, hold, convey, assign, devise, bequeath, or otherwise dispose of every description of property, whether real or personal, in the same manner as if he were a natural-born subject of His Majesty. 24A—Certain contracts with infants for the repayment of loans to be valid (1) Notwithstanding anything to the contrary contained in any other Act or in any rule of common law or equity the following contracts, whether entered into before or after the commencement of the Law of Property Act Amendment Act 1966 shall be as valid and binding on an infant for all purposes as if the infant were of full age at the time he entered into the contract, namely— (a) any contract entered into by an infant not under the age of eighteen years with the State Bank of South Australia for the repayment of moneys advanced or to be advanced to the infant by the said bank under the provisions of the Advances for Homes Act 1928; and (b) any contract entered into by an infant not under the age eighteen years with the South Australian Housing Trust or any institution or society within the meaning of the Homes Act 1941 for the repayment of moneys lent or to be lent to the infant by the said Trust or any such institution or society; and (c) any contract entered into by an infant not under the age of eighteen years— (i) with a building society registered under the Building Societies Act 1881; or (ii) with an industrial and provident society registered under the Industrial and Provident Societies Act 1923, for the repayment of moneys lent or advanced or to be lent or advanced to the infant by any such society; and (d) any contract entered into by an infant not under the age of eighteen years for the repayment of moneys lent or advanced or to be lent or advanced to the infant by a bank or life assurance company or society for the purpose of purchasing or erecting a dwelling house for his own occupation; and (e) any contract entered into by an infant not under the age of eighteen years with any building contractor for the purchase or erection of a dwelling house for his own occupation. (2) An infant who has entered into any contract referred to in the last preceding subsection, whether before or after the commencement of the Law of Property Act Amendment Act 1966 shall not at any time be entitled on any ground relating to his infancy or former infancy to avoid any of his obligations under the contract or under any instrument executed by the infant whereby the repayment of any moneys lent or advanced is secured or to repudiate any contract or any transfer, conveyance or assignment to any such infant relating to any property charged by him. (3) Any instrument executed or purporting to have been executed by an infant by way of security for the repayment of any moneys lent or advanced or to be lent or advanced to the infant in pursuance of a contract of a kind referred to in subsection (1) of this section shall be as valid and effectual for all purposes as if the infant were of full age and capacity at the time he executed the instrument. (4) For the purposes of this section— (a) any reference in this section to a contract entered into by an infant shall be read and construed as including reference to a contract entered into by an infant jointly with some other person or persons (whether of full age or not); and (b) any reference in this section to moneys lent or advanced or to be lent or advanced to an infant shall be read and construed as including reference to moneys lent or advanced or to be lent or advanced to the order of an infant or to an infant jointly with some other person or persons (whether of full age or not); and (c) any reference in this section to an instrument executed by an infant shall be read and construed as including reference to an instrument executed by an infant jointly with some other person or persons (whether of full age or not); and (d) any reference in this section to an instrument shall include an instrument registrable under the provisions of the Real Property Act 1886. 24B—Abolition of doctrine of interesse termini (1) A leasehold estate or interest is capable of taking effect notwithstanding that the lessee has not entered into possession of the land subject to the lease. (2) This section applies to leasehold estates or interests whether created before or after the commencement of the Statutes Amendment (Property) Act 1980. 24C—Body corporate may hold property as joint tenant (1) Subject to subsection (2), a body corporate is capable of acquiring and holding real or personal property in joint tenancy. (2) The acquisition and holding of property by a body corporate in joint tenancy is subject to— (a) any limitations on the capacity of the body corporate to acquire or hold property in joint tenancy imposed by a statute or other instrument defining or affecting the capacities of the body corporate; and (b) any limitations on the capacity of the body corporate to acquire or hold property that apply whether the property is to be acquired or held in joint tenancy or not. (3) Where a body corporate is a joint tenant of property, the property devolves, on dissolution of the body corporate, on the other joint tenant. 24D—Capacities of corporations (1) A corporation sole established under an Act has, and will be taken always to have had— (a) perpetual succession and a common seal; and (b) the capacity to sue and be sued in the corporation's name; and (c) subject to any limitations imposed under an Act, all the powers of a natural person. (2) A right or liability that a corporation sole or corporation aggregate would have acquired or incurred but for the occurrence (before or after the commencement of this section) of a temporary vacancy in the office or offices of the corporation will be treated as having taken effect on the filling of the vacant office or offices as if the vacancy or vacancies had been filled before the right or liability was acquired or incurred. 25—Contingent remainders protected against the premature failure of a preceding estate A contingent remainder existing at any time after the commencement of this Act shall be capable of taking effect, notwithstanding the want of a particular estate of freehold to support it in the same manner as it would take effect if it were a contingent remainder of an equitable estate supported by an outstanding estate in fee simple. Part 3—General rules affecting contracts, conveyances, and other instruments 26—Contracts for sale of land to be in writing (1) No action shall be brought upon any contract for the sale or other disposition of land or of any interest in land, unless an agreement upon which such action is brought, or some memorandum or note thereof, is in writing, and signed by the party to be charged or by some person thereunto by him lawfully authorised. (2) This section does not affect the law relating to part performance, or sale by the court. 27—Discharge of incumbrances by the Court on sales or exchanges (1) Where land subject to any incumbrance, whether immediately realisable or payable or not, is sold or exchanged by the court, or out of court, the court may, if it thinks fit, on the application of any party to the sale or exchange, direct or allow payment into court of such sum as is hereinafter mentioned, that is to say— (a) in the case of an annual sum charged on the land, or of a capital sum charged on a determinable interest in the land, the sum to be paid into court shall be of such amount as, when invested in Government securities, the court considers will be sufficient, by means of the dividends thereof, to keep down or otherwise provide for that charge; and (b) in any other case of capital money charged on the land, the sum to be paid into court shall be of an amount sufficient to meet the incumbrance and any interest due thereon but in either case there shall also be paid into court such additional amount as the court considers will be sufficient to meet the contingency of further costs, expenses and interest, and any other contingency, except depreciation of investments, not exceeding one-tenth part of the original amount to be paid in, unless the court for special reason thinks fit to require a larger additional amount. (2) Thereupon, the court may, if it thinks fit, and either after or without any notice to the incumbrancer, as the court thinks fit, declare the land to be freed from the incumbrance, and make any order for conveyance, or vesting order, proper for giving effect to the sale or exchange, and give directions for the retention and investment of the money in court and for the payment or application of the income thereof. (3) The court may declare all other land (if any) affected by the incumbrance (besides the land sold or exchanged) to be freed from the incumbrance, and this power may be exercised either after or without notice to the incumbrancer, and notwithstanding that on a previous occasion an order, relating to the same incumbrance, has been made by the court which was confined to the land then sold or exchanged. (4) On any application under this section the court may, if it thinks fit, as respects any vendor or purchaser, dispense with the service of any notice which under this Act or otherwise would apart from this subsection be required to be served on the vendor or purchaser. (5) After notice served on the persons interested in or entitled to the money or fund in court, the court may direct payment