Wood MichaelMICHAEL WOOD (Labour—Mt Roskill): I am very pleased to take this opportunity to speak on this section being clauses 3 to 8 in Part 1 of the Land Transfer Bill. As was reflected on by my colleague Raymond Huo this is a substantial and important piece of legislation. I know that when we look at Part 3 the members opposite who are very engaged in this debate through their comments are going to be exceptionally pleased to know that we are continuing to maintain the Torrens system of land title in New Zealand—Paul Foster-Bell: Hear hear!MICHAEL WOOD: —and we hear that from them now. I make a bit of a joke of that but it is important because you know what is the Torrens system for example? When we look at the purpose of the bill—and the purpose of the bill is part of the debate in this section—we need to get this absolutely right. The Torrens system for what it is worth is the fundamental system that we have whereby the State retains a register of land. When you actually think about the kind of way in which our economy operates and the absolute importance of people having certainty over who owns which bit of land and what happens when you have a transaction—The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break. Sitting suspended from 6 p.m. to 7.30 p.m.MICHAEL WOOD: It is a real pleasure to resume my call on this bill. As I was saying before we left the Chamber this is a bill that is quite technical in detail—Hon Christopher Finlayson: We'll get down to the detail.MICHAEL WOOD: I know that will bring quivers of delight to some members who are in the Chamber this evening.But it is actually an extremely important bill and it goes to some really core things at the heart of our society and economy. Everyone who owns a property or plans to transact in a property wants to know that there is certainty of ownership before and after that transaction. One of the things that this bill deals with in that respect and tries to affirm is the Torrens system which is perhaps relatively unknown but is an extremely important legal principle that we have in respect of property ownership and land transfer in our country and also most other Westminster systems. It is referenced in clause 3 in Part 1 of the bill that of course we are talking about at the moment. What the Torrens system ensures is that people can have that certainty. It means we have a legally enforceable State-run register of land and you can take it to the bank. You know that if on that register it says that such and such a person owns this bit of land in this place that is the way it is. If you think that if we did not have that certainty think about the problems that we would get into. So it is incredibly important.One of the really important words that we use when we describe the Torrens system and it is used I am pretty sure at points in this legislation is the word indefeasibility"; it guarantees indefeasible title. It is an extremely high legal test. It basically means it is undefeatable. There is no question about it; that is it. One of the questions I want to get on to in respect of this debate is how we deal with the fact that this bill intends to and of course we support this retain the Torrens system—and again it is mentioned here in clause 3(a) that we want to continue and maintain the Torrens system of land title in New Zealand and then in subclause (b) retain "the fundamental principles of that system".At the same time further on in the bill—and we will have debates on this I suspect in Part 2—we are actually intending to create some extremely limited grounds for defeating that principle of indefeasibility. So in cases where there might be manifest injustice we are saying that that indefeasibility might not apply it would have to involve the High Court there are extremely limited grounds for going down that track and we think that they are probably justifiable. But it raises an interesting question in respect of clause 3 in Part 1 where we start by saying that we want to continue and maintain the Torrens system but at the same time later on in the bill we are injecting a set of new principles that do bluntly somewhat undermine the core indefeasibility at the heart of the Torrens system.One of the questions I have for the Minister in the chair is in respect of clause 3 where the Government Administration Committee has made an alteration to the bill. They have added in the wording "(d) by all of the above means maintains the integrity of title to estates and interests in land." In the accompanying text the select committee has said that "For clarity and certainty we recommend adding subclause 3(d)"—as I have just described—"to insert the principle of 'maintaining integrity of title to estates and interests in land'. We consider that this inclusion is necessary to safeguard this principle." The question I have for the Minister in the chair is is the issue that I have just described the reason that we have felt the need to put in that additional wording to safeguard the principle of the Torrens system? Do we need that additional wording there because we think that changes later on in the bill could potentially create the risk that we are undermining the Torrens system and does that have unforeseen or foreseen circumstances that we are concerned about? So it would be really good to hear from the Minister in the chair exactly why that wording has been inserted and if it is about addressing that particular issue.Just in my remaining time briefly—[Bell rung] Thank you Mr Chair. The clock was—OK; I will carry on. I will probably take a brief call on this part.In terms of some of the other changes that we see from the select committee in this part I think my colleague Peeni Henare expounded admirably on clause 5(1)(d) the addition of "plants trees and timber on or under land" and I think he posed some questions to the Minister in the chair that it would be good to hear about as well. I have got a good definition of "paper instrument" which I am sure will put many minds to ease as well.As I say our core concern at this point of the debate is that at this very first stage we do tackle this question of the purpose because if we get the purpose wrong if we undermine the principles of the Act we create problems for ourselves a little bit later on.One thing I did note in clause 3(d) which I referred to as well is that the wording does have a shadow of some very important wording in the Tax Administration Act where at the beginning of the Act we say that one of the things we have to do is maintain the integrity of the system. Within the context of the Tax Administration Act that effectively gives scope to Inland Revenue as an agency to undertake a fairly wide range of actions and have wide freedom of movement to ensure that things are kind of done as we think they should be done. So it gives a latitude of operation. Perhaps again the Minister in the chair might be able to assist in answering whether that is also part of the intention of the inserted clause 3(d) here. Does it mean that we might see Land Information use this as a bit of a roving tool to ensure that the system does maintain its integrity perhaps in ways it does not currently as well? So it would be good to hear what is envisaged with that part.I think with that those are probably the key points I would like to raise in respect of this part but I look forward to taking further calls on later parts. Thank you."