10/09/2016, 05:07:PM
10/09/2016, 05:07:PM
When can you register a caveat?
Caveats are a form of a statutory injunction and may only be lodged by persons who have an estate interest in land.
A party cannot confer a right under contract to lodge a caveat where no caveatable interest exists. However, if there is a proprietary right created through contract, which creates an interest in land a caveat can be registered against that land.
A caveatable interest is a proprietary interest. In Municipal District of Concord v Coles (1906) the court held: it is only a person who has a legal or equitable interest in land, partaking of the character of an estate in it or equitable claim to it, who can lodge a caveat.
Considering this point another way. An existing proprietary interest at law or in equity will support both the lodgement and extension of a caveat, whereas a straight contractual right will be insufficient. The legal and equitable interest must presently exist and not be a mere potentiality.
There needs to be no relationship between the registered proprietor and the interests of the caveator, all that is required to lodge a caveat is a legal or equitable interest in the property.
Once the caveat is lodged, it will remain in place until removed by the caveator or by order of the court.
Some examples of caveatable interests include:
1. A purchaser under a contract of sale.
2. A lender that finances a property.
3. A building contract which contains a charging clause for a caveat but this claim is with risk.
4. An option to purchase or repurchase land supported by valuable consideration.
5. A caveat may be lodged pursuant to an implied trust.
6. A caveat may be lodged pursuant to a constructive trust.
7. Personal representatives of a deceased estate have a right to lodge a caveat to protect the estate.
Caveats may be lodged under a range of claims, but caution must apply because wrongly lodging a caveat can destroy a registered proprietor’s right to deal with the land in the way that party requires. And in order to protect registered proprietors, a party that wrongly lodges a caveat without reasonable cause, the registered proprietor will be able to bring a claim against that party for compensation and damages sustained.
So before you lodged that caveat, get that legal advice to protect your legal rights & interests.
The comments in the aforementioned do not constitute legal advice and are general in nature, and if legal advice is required please contact: John Melis at Legal AU Pty Ltd (03) 9999 7799
Legal AU Pty Ltd Lawyers are “Liability limited by a Scheme approved under Professional Standards Legislation.”
