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Members may wish to note a recent examination of the rule in Barnes v Addy in Tara Shire Council v Garner & Ors [2002] QCA 232, a decision of the Court of Appeal in Queensland.

X sold a piece of land to Y and received payment of the purchase price. X subsequently sold the piece of land to Z. Z acquired its interest in the land with knowledge that the land had been sold to Y. Z became registered proprietor of the land. Y sought a declaration that Z held the subject land on a constructive trust for Y and an order that it execute such trust together with interest and costs. The question before the Court was whether Y's pleading disclosed an arguable cause of action. This turned on whether Z had indefeasible title of the land in accordance with s 184 of the Land Title Act 1994 (Qld) or whether Z's knowledge was arguably sufficient to give rise to an "equity" within the meaning of the exception to indefeasibility contained in s 185(1)(a) of the Land Title Act.

The Court of Appeal concluded that Y's cause of action was arguable.

For Australian readers the case is primarily of interest because of its examination of the question whether the knowledge of the registered proprietor of land was sufficient to give rise to an "equity" within the meaning of the statutory exception to statutory indefeasibility. In this regard, Atkinson J (with whom McMurdo P agreed) concluded that at least arguably it was sufficient. Davies JA was strongly to the contrary view.

Although accessory liability was not directly in issue, Atkinson J made a number of observations about the requisite mental element of both limbs of Barnes v Addy. Davies JA did not examine the issue.

JOHN BOND SC
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