Bona fide purchaser protection bars recovery of vendor sales tax arrears from property bought for value without notice.

A charge for sales tax arrears was not enforceable against a transferee for value without notice where the statute did not expressly override that protection. The court applied the principle that constructive notice must be proved on the facts, and found no material of collusion, wilful abstention from inquiry, actual notice, or constructive notice; the encumbrance record also did not disclose the charge. The purchaser was therefore treated as a bona fide purchaser, and recovery proceedings against the property for the vendor's tax liability were held not sustainable.

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Issues: Whether the recovery proceedings for sales tax arrears could be enforced against the petitioner, who had purchased the property for value without notice of the charge, and whether such a bona fide purchaser was protected against the vendor's tax liability.

Analysis: The property was purchased by the petitioner after the tax arrears had arisen against the vendor, but the record did not show that the petitioner had notice of the charge. The governing principle applied was that, unless the statute expressly overrides it, a charge cannot be enforced against a transferee for consideration without notice, and constructive notice must be established on the facts. The protection recognised for bona fide purchasers was applied in the light of the statutory scheme and the absence of material showing collusion, wilful abstention from enquiry, or actual or constructive notice. The encumbrance record also did not reflect the charge.

Conclusion: The petitioner was held to be a bona fide purchaser for consideration without notice of the charge, and the proceedings to recover the vendor's sales tax arrears from the property were not sustainable.

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