Bunt v Hallinan Case Notes

Property Law – Land Transfer Land — Indefeasibility of Title – “Fraud” – Unregistered Interest

Background

The case of Bunt v Hallinan, heard in the Court of Appeal of Wellington in 1984, revolves around a dispute over an unregistered lease and the concept of indefeasibility of title under the Land Transfer Act 1952. Mrs. Bunt operated a pottery on land initially owned by her husband. In 1973, Mr. Bunt sold the property to Meates, including a provision for a 15-year lease to the Bunts for the rear portion of the land (where the pottery was located) at a nominal rent of $1 per annum$. This lease, however, was never registered.

Over time, the property changed hands, eventually being purchased by Hallinan in 1980. Hallinan was aware of Mrs. Bunt's pottery operation and the claimed lease. Before purchasing, Hallinan sought legal advice from his solicitor, Keenan, who, after a title search, advised that the Bunts had no registered interest and Hallinan could ignore their unregistered lease. Following registration of the transfer to his name, Hallinan evicted the Bunts, leading to legal action.

District Court

The District Court initially ruled in favor of the Bunts, finding Hallinan's conduct amounted to fraud because he purchased the property knowing of their leasehold interest and then acted to defeat it, awarding damages to the Bunts.

High Court

On appeal, the High Court reversed the fraud finding, stating that while Hallinan's actions were