Caveats

A caveat is an instrument provided for under the Real Property Act 1900 that can be registered on the title to property by a person or organisation (the “Caveator”). The caveat operates as a statutory injunction and prevents the registration of particular dealings and plans on a title without the caveators express consent. There are similar provisions in the relevant legislation in other states permitting a caveat to be registered on the title of properties in those jurisdictions.

A caveat not only operates as a statutory injunction but also serves as a warning to third parties that the Caveator has an interest in the property.                

Who can lodge one?  

Not anyone can lodge a caveat. In order to lodge a caveat you must have an equitable interest in the property known as a “caveatable interest”. There are several types of recognised caveatable interest including:

• purchaser under a contract for sale

• grantee under an option to purchase land

• mortgagee

• chargee under a credit facility

• lessee under an agreement for lease or a lease

What are the benefits?

The registration of a caveat can provide increased protection for a person with an equitable interest in land. By recording an interest in the property a caveator can be assured that there will be no dealings with the title which are adverse to the caveators interest without first obtaining the caveators written consent. If a dealing is lodged without the caveators consent, the Registrar General will not proceed until the caveators consent is provided.           

What are the risks?

There can be serious consequences where a person lodges a caveat without a caveatable interest. If the owner of the property suffers financial loss as a result of the caveat being lodged on title without proper grounds, then a court may order the caveator to pay damages which can be substantial.         

How do you remove a caveat?

There are a number of ways in which a caveat can be removed including:

• with consent of the caveator – the parties may be able to reach a commercial agreement for the caveator’s interest to be satisfied and the caveat to be withdrawn.

• by issuing a lapsing notice – if the owner believes that the caveator has no right to maintain a caveat on title the owner can apply to the Registrar General for the issue of a lapsing notice. The lapsing notice is served upon the caveator and if they do not take action to maintain the caveat on title within 21 days (by approaching the court) then the caveat will automatically be removed.

• by court order – the owner may approach the court for orders that the caveat be withdrawn.

How we can help

We have significant experience dealing with caveats at Bartier Perry. We can assist you in the following ways:

• Advising whether you have a caveatable interest and whether you should register a caveat on title.

• Assisting with the removal of a caveat that has been lodged improperly.

• Helping you to keep your caveat if someone tries to remove it.

• Attending to lodgment of all required documentation via PEXA (the online electronic conveyancing platform).

• Advising you where you may have suffered a loss due to a caveat being improperly registered on title.