THE PROVISO TO SECTION 340(3) OF THE NATIONAL LAND CODE 1965 (NLC) : A STUDY

Abstract

Under the Torrens system, section 340 (1) of the NLC only gives the indefeasibility upon the  registered proprietor. Fraud, misrepresentation, forgery, insufficient or void instrument and unlawful acquisition are the exceptions to the indefeasibility provided in section 340(2) of NLC. Under section 340(3)(a) or (b) of NLC, the person whose title is defeasible, if he had made a subsequent dealing on the land, the new proprietor’s title still defeasible. The new proprietor will only get the protection under the proviso to section 340(3) of NLC if he can prove that he is a good faith purchaser. The proviso to section 340(3) applies only to the subsequent transferee and not the first transferee. The purpose of this article is to identify the criterions used by the courts in categorizing that person as bona fide purchaser, the position and the remedy of the bona fide purchaser in land matters. The methodology used in this study is a library based research which includes document analysis, such as the decided cases, book and articles. This study also discusses some suggestions for improvement and outcome to ensure the interests and rights of the parties involved.