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G A Z E T T E
N O V E M B E R
1976
THE FAMILY HOME PROTECTION ACT
1976
by GARRETT GILL, S.C.
By now most practitioners will be familiar with the
terms of this short Act, passed on the 12th July, 1976,
and will be aware that it creates many problems for
Conveyancers. The Act creates a new kind of property
right or equity affecting the "family home" and the
household chattels of a married couple. In this country
the family home and most of the household chattels
generally belong to the husband, and for convenience
in this article it will be assumed that this is always
the case, but the Act is so framed as to protect the
interests of whichever spouse is not the legal owner of
the property in question. This article only deals with
the Act as it affects title to land.
The first point to note is that "Conveyance" is de-
fined by Section I as including a mortgage (legal or
equitable), lease, assent, transfer, disclaimer, release
and any other disposition of property otherwise than
by will or
donatio mortis causa,
and also an enforce-
able agreement to make any such conveyance. "Family
home" means a dwelling in which a married couple
ordinarily reside and also a dwelling in which a "spouse
whose protection is in issue" ordinarily resides, or, if
that spouse has left the other spouse, ordinarily re-
sided before so leaving. "Dwelling" includes a build-
ing or part of a building occupied as a separate
dwelling and the ground occupied with it or required
for its amenity. Bearing in mind these definitions, we
come to Section 3, which is the section of most concern
to the lawyer dealing with conveyancing, title to land,
and contracts for the sale of land.
Section 3, subsection (1) provides that "Where a
spouse, without the prior consent in writing of the
other spouse, purports to convey any interest in the
family home to any person except the other spouse,
then, subject to subsections (2) and (3) and Section 4,
the purported Conveyance shall be void". Subsection
(2) merely excludes from this provision a conveyance
made pursuant to an enforceable agreement entered
into before the marriage. Subsection (3) says that a
Conveyance shall not be void by virtue of subsection
(1) if:
(a) it is made to a purchaser for full value;
(b) it is made by a person, other than the spouse
making the purported Conveyance referred to
in Subsection 1, to a purchaser for value; or
(c) its validity depends on the validity of a con-
veyance in respect of which any of the con-
ditions mentioned in subsection (2) or para-
graph (a) or (b) is satisfied.
"Full value" is defined in subsection (5) as such
value as amounts or approximates to the value of that
for which it is given. "Purchaser" is defined in sub-
section (6) as a person who in good faith acquires an
estate or interest in property. Subsection (4) says that
if any question arises in any proceedings as to whether
a conveyance is valid by reason of subsection (2) or (3)
the burden of proving validity shall be on the person
alleging it.
The difficulties created by Section 3 of the Act are
very considerable. In the first place it should be noted
that there is a "family home" on most farms, and the
farm cannot be disposed of or mortgaged without the
prior written consent of the owner's spouse unless
Land Commission Consent to subdivision is obtained.
The owner of business premises frequently has his
family home overhead and will not be able to sell or
mortgage the building without his wife's prior written
consent. So Section 3 has a wider effect than may at
first be appreciated. As "Conveyance" includes an
"enforceable agreement" to convey, it appears that
neither party to a Contract for the sale of land will be
bound by the Contract unless the prior written consent
of the vendor's spouse was given. It is difficult to see
how in such a case the agreement could be called an
"enforceable agreement", but presumably this is to be
read as "enforceable apart from the provisions of this
Act".
At first sight it may seem that Section 3, subsection
(3) (a) will in most cases solve the problem: this says
that subsection (1) shall not render a conveyance void
if it is made to a purchaser for full value. But the
purchaser must be one who acquires the property "in
good faith" and "full value" must be such value as
equals or approximates to the value of that for which
it is given. We are all familiar with the general prin-
ciples applicable in deciding whether or not a person
is a purchaser "in good faith", and relating to notices
or construction notices of equities; they are stated in
Hals bury
(3rd Edit., Vol. 14 at pp. 542-549). Section
3 of the Conveyancing Act, 1882, modifies somewhat
the principle of construction notice, but subsection (7)
of Section 3 of the present Act reduces the protection
given by Section 3 of the Conveyancing Act, 1882. To
be a purchaser "in good faith" one must, as a general
rule, investigate the vendor's title, make all appropriate
enquiries and receive satisfactory replies.
If, for
example, a material title deed is missing, its absence
must be accounted for and it will be desirable to have
the explanation verified by a statutory declaration:
otherwise the purchaser's title may be affected by an
equitable mortgage.
Now what are the enquiries that ought reasonably
to be made in connection with this new Act? In the
first place, does the property for sale consist of, or
include, a dwelling or part of a dwelling, or land that
is an amenity of a dwelling? Then, is that dwelling a
"family home"? This raises the question of whether
or not the Vendor is married: if so, has he a spouse
"whose protection is in issue" ? What is meant by this
phrase? If there is no legal issue in being at the date
of the Conveyance is the dwelling not then a "family
home", or does the phrase cover the case where such
an issue subsequently arises? In many cases the "issue"
will arise only when the purchaser seeks to complete
the purchase and obtain vacant possession. If the wife
is away from home at the time no "issue" may arise
until she returns, to find a purchaser in occupation.
It would seem that, on any transaction involving
a dwelling, or part of the grounds of a dwelling, an
intending purchaser should ask (even before signing
a Contract) and an intending mortgagee or lessee should
ask, "Are you married?" "Did your spouse ever reside
on the property or in any dwelling in respect of which
the property in question was an amenity?" If the re-
quest is in writing and the reply satisfactory, this may
be sufficient to constitute the "purchaser" one who
has dealt in good faith in the transaction, since Section
15 imposes heavy penalties on a person knowingly
giving false information in reply to such a request:
but it will not protect a purchaser who (or whose
agent) has notice of facts indicating that the replies are
incorrect. If a couple are living together as husband
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