The applicant, Ying Tsuen Tiao, brought an application to declare a fraudulent discharge of her first mortgage void and to rectify the land register by restoring her mortgage to its original first priority position.
The respondents, Dino Leone and Jeanette Leone, had fraudulently discharged the applicant's mortgage and subsequently registered new mortgages.
While the Director of Titles agreed to delete the fraudulent discharge, they argued the applicant's mortgage should be reinstated in a lower priority.
The court applied the theory of deferred indefeasibility, finding the Leones were fraudulent persons and the subsequent mortgagees were intermediate owners.
The court ordered the fraudulent discharge void and the applicant's mortgage restored to first priority, ahead of the subsequent mortgages.
