Midland Bank v Green [1981] 1 All ER 583

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A father had granted an option over land to his son, but it had not been registered. The father later tried to frustrate the option by conveying the land to his wife for £500. The land was worth £40,000. When the son found out about it, he sought to exercise the option, and then sued his father and his deceased mother’s estate for specific performance, as well as for damages for conspiracy by his parents.

Oliver J held : the sale to the mother was a genuine sale and was not a sham. She was “a purchaser of a legal estate for money or money’s worth” against whom the unregistered option was void under section 13(2) LCA 1925. It followed that the claim for specific performance against the mother’s estate failed. The son appealed.

Held : The house restored Oliver J‘s judgment. The mother was a person against whom the option was void for non-registration. The transaction was not a sham. In a ‘pure’ registration system, notice is irrelevant; this has the advantage that intending purchasers are relieved of the burden of making exhaustive enquiries. There is nothing wrong with a party seeking to benefit from the technical effects of the registration regime and the consequences of a failure of a person to protect himself under it.

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September 30, 2011 :: Posted by - Santhi :: Category - Case Law

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