Abigail v Lapin (1934) 51 CLR 58 revolved around a complex scenario involving land ownership, equitable interests, and the intricacies of the Torrens system in New South Wales. At the heart of the dispute were two properties transferred from the original owner (Lapin) under the Real Property Act 1900 to a creditor's nominee (Heavener) as security for a debt, without the transferors lodging a caveat. This omission allowed the creditor (Abigail) to secure an additional loan against these properties without the original owners' consent, thereby raising a contention over equitable titles.
The Privy Council ultimately determined that the creditor, represented by his legal successors upon his death, had a superior equitable interest over the original owner. This decision was grounded in the argument that the original owners, by their actions, had enabled the creditor's nominee to present herself as the absolute owner, thereby allowing her to further encumber the properties. Additionally, the solicitor involved did not carry on as a money-lender in the transactions' context, as defined by the relevant legislation.
Full text: https://jade.io/article/272038
From the TLDR Caselaw Archive