InkElites LMS

THE DOCTRINE OF NOTICE

EQUITY & TRUST | Page 4 of 16
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determine the priority of an equitable mortgagee by deposit of title deeds and a subsequent purchaser for value without no- tice of the mortgage. The purchaser, who had no notice of the prior equitable mortgage, had bought the property from the mortgagor. He did not ask for production of the title deeds; there was no inquiry as to the abstract of title which would have fixed him with notice of the equita- ble mortgage. The court held that the purchaser's title should be postponed on the ground that where no in- quiry as to title is made and no production of the deeds is asked for, the purchaser acquiring the legal estate cannot claim in priority to a prior equitable mortgage. It is settled law that a pur- chaser for value of the legal estate without notice or a prior incumbrance will be postponed if it is established that either he deliberately abstains from making investigation as to the deeds, or he is guilty of such gross negligence as would render it unjust to deprive the prior incumbrancer of his priority. See Akingbade v. Elemesho (1964) 1 All N.L.R 154. A purchaser need not be guilty of any fraud or dishonest conduct before being postponed to a prior equitable incumbrancer. In Labinjo v. Olufunmise Suit No. LD/355/68 (unreported), the trustees of a trust under which the plaintiff was a beneficiary, sold in breach of trust, the trust property situates at 20 Glover Street, Lagos, to the defendant who claimed that he was a bona fide purchaser for value of the legal estate without notice. He, however, admitted under cross-examination by the plaintff’s counsel that he made no enquiries or caused any investigation to be made as to the interests (if any) which affected the title of his vendor. The court held that in accordance with section 3(1) of the Conveyancing