Onashile S. T. V Sule Salami Idowu (1961)

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UNSWORTH, F.J

This is a case in which the appellant mortgaged certain properties to the third respondent, who later purported to sell the legal estate to the first and second respondents under the power of sale conferred by the Conveyancing Act, 1881. It was contended in the High Court that the mortgage was void for want of registration under section 5 of the Registration of Titles Ordinance, and that the subsequent sale was therefore also void.

The section relates to first registration under the Ordinance and provides inter alia, that “every conveyance of a fee simple estate in any land for a consideration which consists wholly or in part of money … shall, on the expiration of two months from the date thereof or of any authorised extension of that period, become void so far as regards the grant or conveyance of the legal estate.”

The trial Judge held that section 5 of the Ordinance does not apply to a mortgage, on the ground that it is not an absolute conveyance of the fee sim-ple. Chief Rotimi Williams, who appeared on behalf of the appellant, sub-mitted that a mortgage deed of the kind in dispute in this case does, in fact, create a fee simple absolute and is therefore registrable under section 5. In support of this he referred to a number of decisions on the interpretation of section 25 of the Supreme Court Judicature Act, 1873, in which it was held that a mortgage is “an absolute assignment (not purporting to be by way of charge only)” within the meaning of that section. The cases referred to were Burlinson v. Hall (1884) 12 Q.B.D. 347; Tattered v. Delagoa Bay and East Africa Railway Co. (1889) 23 Q.B.D. 239; and Durham Brothers v. Robertson (1898) 1 Q.B.D. 765. It is true that these cases relate to an assign-ment of debts and chores in action, but they do appear to establish the prin-ciple that a mortgage may be an absolute assignment, notwithstanding the provision for redemption. In this respect the following comments in the judgment of Chitty, L.J., in the case of Durham Brothers v. Robertson are relevant:

A mortgage is not mentioned in the enactment; but where there is an absolute assignment of the debt, the limiting words as to charge only are not sufficient to exclude a mortgage. The re-spondent’s counsel cited a passage from Fisher on Mortgages and from Wharton’s Dictionary to the effect that a mortgage was a conditional conveyance. In bygone days mortgages were made by a conveyance subject to a condition making it void if the money was repaid within six months; but mortgages in this form had become obsolete long before the Judicature Act, 1873, was passed. The form was abandoned because of the difficulty in as-certaining in whom the legal estate was vested, the title being made to depend on the fact whether the money was or was not paid within the time limited by the condition.

Chief Williams submitted further that the mortgage in this case came within the other requirements of section 5. The consideration was a money consideration and a mortgage is a conveyance within the meaning of Cred-land v. Potter 10 Ch. p.8, where the Court said:–

There is no magic in the word ‘conveyance’. It means an instrument conveying from one person to another an interest in land.

Mr. Impey, for the first and second respondents, submitted that section 5 applies only to an unqualified conveyance and that it would be inconsistent with the other provisions of the Ordinance to construe that section as including a conveyance by way of mortgage. He referred in particular to sections 6 and 48 of the Ordinance, which I shall refer to later in this judgment. Mr. Garrick, who appeared on behalf of the third respondent, associated himself with the argument of Mr. Impey. He also pointed out that a mortgagee could call for the Land Certificate if he was registered as the owner, and submitted that this was not intended.

The case is by no means free from difficulty, but it seems to me that a mortgage comes within the meaning of section 5. It is a conveyance of the fee simple and is absolute in accordance with the authorities cited above. I had at first some doubt whether the consideration could strictly be described as money, but I have reached the conclusion that the loan consideration in this mortgage is a money consideration, in the same way as a loan consideration in a debenture is a money consideration. In these circumstances the literal construction must be followed unless this would lead to absurdity and inconsistency with the provisions of the Ordinance as a whole. I do not think that there is any such inconsistency. Section 6 is sufficiently wide to include a mortgage and it cannot therefore be said that the Ordinance does not contemplate the registration of a mortgage. It was argued that the registration of a mortgage cannot have been intended because this would have the effect of destroying the equity of redemption, but an examination of the Ordinance shows that this is not so. Subsections (2) and (3) of section 48 preserve any estate which is not an encumbrance and also any estate which is adverse to or in derogation of the title of the rightful owner; and these estates include an equity of redemption by virtue of the definition of an “estate” in section 3 of the Ordinance. The fact that the mortgagee may be able to call for the Land Certificate does not amount to an inconsistency.

It follows that this mortgage should have been registered under section 5 of the Ordinance. It has therefore become void in so far as it purports to convey the legal estate and the purported sale under the Conveyancing Act is also void to this extent.

I would accordingly allow the appeal and set aside the order for possession and mesne profits, and the order for costs. The appellant is entitled to costs both here and in the Court below, and I would assess these costs at a total of ninety guineas.

BRETT, F.J

I concur.

TAYLOR, F.J

I concur.

This is a case in which the appellant mortgaged certain properties to the third respondent, who later purported to sell the legal estate to the first and second respondents under the power of sale conferred by the Conveyancing Act, 1881. It was contended in the High Court that the mortgage was void for want of registration under section 5 of the Registration of Titles Ordinance, and that the subsequent sale was therefore also void.

The section relates to first registration under the Ordinance and provides inter alia, that “every conveyance of a fee simple estate in any land for a consideration which consists wholly or in part of money … shall, on the expiration of two months from the date thereof or of any authorised extension of that period, become void so far as regards the grant or conveyance of the legal estate.”

The trial Judge held that section 5 of the Ordinance does not apply to a mortgage, on the ground that it is not an absolute conveyance of the fee sim-ple. Chief Rotimi Williams, who appeared on behalf of the appellant, sub-mitted that a mortgage deed of the kind in dispute in this case does, in fact, create a fee simple absolute and is therefore registrable under section 5. In support of this he referred to a number of decisions on the interpretation of section 25 of the Supreme Court Judicature Act, 1873, in which it was held that a mortgage is “an absolute assignment (not purporting to be by way of charge only)” within the meaning of that section. The cases referred to were Burlinson v. Hall (1884) 12 Q.B.D. 347; Tattered v. Delagoa Bay and East Africa Railway Co. (1889) 23 Q.B.D. 239; and Durham Brothers v. Robertson (1898) 1 Q.B.D. 765. It is true that these cases relate to an assign-ment of debts and chores in action, but they do appear to establish the prin-ciple that a mortgage may be an absolute assignment, notwithstanding the provision for redemption. In this respect the following comments in the judgment of Chitty, L.J., in the case of Durham Brothers v. Robertson are relevant:

A mortgage is not mentioned in the enactment; but where there is an absolute assignment of the debt, the limiting words as to charge only are not sufficient to exclude a mortgage. The re-spondent’s counsel cited a passage from Fisher on Mortgages and from Wharton’s Dictionary to the effect that a mortgage was a conditional conveyance. In bygone days mortgages were made by a conveyance subject to a condition making it void if the money was repaid within six months; but mortgages in this form had become obsolete long before the Judicature Act, 1873, was passed. The form was abandoned because of the difficulty in as-certaining in whom the legal estate was vested, the title being made to depend on the fact whether the money was or was not paid within the time limited by the condition.

Chief Williams submitted further that the mortgage in this case came within the other requirements of section 5. The consideration was a money consideration and a mortgage is a conveyance within the meaning of Cred-land v. Potter 10 Ch. p.8, where the Court said:–

There is no magic in the word ‘conveyance’. It means an instrument conveying from one person to another an interest in land.

Mr. Impey, for the first and second respondents, submitted that section 5 applies only to an unqualified conveyance and that it would be inconsistent with the other provisions of the Ordinance to construe that section as including a conveyance by way of mortgage. He referred in particular to sections 6 and 48 of the Ordinance, which I shall refer to later in this judgment. Mr. Garrick, who appeared on behalf of the third respondent, associated himself with the argument of Mr. Impey. He also pointed out that a mortgagee could call for the Land Certificate if he was registered as the owner, and submitted that this was not intended.

The case is by no means free from difficulty, but it seems to me that a mortgage comes within the meaning of section 5. It is a conveyance of the fee simple and is absolute in accordance with the authorities cited above. I had at first some doubt whether the consideration could strictly be described as money, but I have reached the conclusion that the loan consideration in this mortgage is a money consideration, in the same way as a loan consideration in a debenture is a money consideration. In these circumstances the literal construction must be followed unless this would lead to absurdity and inconsistency with the provisions of the Ordinance as a whole. I do not think that there is any such inconsistency. Section 6 is sufficiently wide to include a mortgage and it cannot therefore be said that the Ordinance does not contemplate the registration of a mortgage. It was argued that the registration of a mortgage cannot have been intended because this would have the effect of destroying the equity of redemption, but an examination of the Ordinance shows that this is not so. Subsections (2) and (3) of section 48 preserve any estate which is not an encumbrance and also any estate which is adverse to or in derogation of the title of the rightful owner; and these estates include an equity of redemption by virtue of the definition of an “estate” in section 3 of the Ordinance. The fact that the mortgagee may be able to call for the Land Certificate does not amount to an inconsistency.

It follows that this mortgage should have been registered under section 5 of the Ordinance. It has therefore become void in so far as it purports to convey the legal estate and the purported sale under the Conveyancing Act is also void to this extent.

I would accordingly allow the appeal and set aside the order for possession and mesne profits, and the order for costs. The appellant is entitled to costs both here and in the Court below, and I would assess these costs at a total of ninety guineas.

BRETT, F.J

I concur.

TAYLOR, F.J

I concur.

Other Citation: (1961) LCN/0911(SC)