Musuru Okunubi V. Antonio Assaf (1951)

LawGlobal Hub Judgment Report – West African Court of Appeal

Contract of sale by mortgagor legal estate being vested in mortgagees—Subsequent sale by Mortgagor to second purchaser who paid the mortgagees the amount secured without obtaining a reconveyance—Equitable priorities of first and second purchaser—Mortgagees hold legal estate in trust for second purchaser—What constitutes notice of equitable interest—Note or memorandum sufficient to satisfy Statute of Frauds.

Facts

The defendant was the appellant and appealed against the judgment of the trial Court which granted the respondent (first purchaser) possession of the properties in dispute. The facts were not seriously in dispute and are fully set out in the judgment of this Court. The main issue was whether the first or second purchaser had priority. In deciding this issue this Court had to determine (a) The effect on priorities arising out of the fact that the second purchaser (the appellant) had paid to the mortgagees the amount secured by the mortgage but had obtained no reconveyance; (b) Whether some knowledge by the mortgagees’ solicitor (who was also solicitor for the appellant) of the first transaction amounted to notice by the appellant of the respondent’s equitable interest.

A subsidiary point was whether there was a note or memorandum of the first contract sufficient to satisfy the Statute of Frauds.

Held

There was a sufficient note or memorandum of first contract to satisfy Statute of Frauds. The solicitor for the appellant received notice of first contract in his capacity as solicitor for the mortgagees and notice by him did not amount to notice by the appellant.

The mortgagees held the legal estate in trust for the second purchaser (the appellant) and, accordingly his title prevailed over the respondent.

Appeal Allowed.