How to put a caveat on a property.

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Caveats are placed on a property as a notice to the public that a person is interested in the property. By lodging a caveat, the person has a priority interest in the property. However, caveats are quite complicated to understand, therefore, this blog post will step out all you need to know about putting a caveat on a property. 

What is a caveat?

A caveat is a statutory injunction that prevents registration of dealings and plans on a title. This statutory injunction is provided for under the Real Property Act 1900. In simpler terms, a caveat is a notice to the public at large that there is an interest in the property for a particular reason. In lodging a caveat, the caveator (the person who has lodged the caveat) is warning anyone dealing with the property that someone has a priority interest in said property. This caveat operates to prevent the property being sold or dealt with and gives notice of an interest regarding the property. The caveator must have an actual interest in the property. 

What are the reasons for lodging a caveat?

A person may wish to lodge a caveatable interest if they have an interest in land which registration of another dealing will not protect. At the time of lodging the caveat, you must have a genuine interest.

Caveatable interests include:

  • Registered or equitable mortgage
  • Registered proprietor
  • Transfer
  • Purchaser under an agreement for sale
  • Contractual rights
  • Tenant (in some circumstances)

Lodging a caveat on property wa provides people who search the registrar with notice of your interest. Lodging a caveat also prevents registration of any dealings relating to that land that are inconsistent with or might defeat the claimed interest. 

What is the registrar?

The registrar is the land register that governs the Torrens system and provides search facilities for NSW, QLD, VIC, SA and NT land title registries. The Registrar records all things to do with property, including ownership changes, mortgages and transactions. 

How to put a caveat on a property?

Under Queensland law, s121-131 of the Land Title Act 1994 governs the requirements of a person lodging a caveat. In the jurisdiction of Queensland, caveats are lodged with the Queensland Titles Registry by filing a Form 11. 

What does a caveat require?

When lodging a caveat in the state of Queensland, you must include:

  • the caveator’s name, residential address or registered office (the address must be able to have notices served to it).
  • The name and address of the registered proprietor (owner)
  • The signature of the caveator, or lawyer or agent acting on behalf of them
  • Reference details relating to the caveat
  • Particulars of the estate of interest (either equitable interest or legal interest)

What occurs if I incorrectly lodge a caveat?

If you incorrectly lodge a caveat you should seek legal advice immediately. If you fail to seek legal advice, a court may order you to compensate any person who suffers a financial loss as a result of your lodgement. Similarly, there are very serious consequences for lodging a caveat without having a caveatable interest. The caveat will be removed from the Registrar and you may be ordered by the court to pay costs in relation to the caveat. 

How can a caveat be removed?

Caveats on property can be removed in a number of ways, including:

  • Withdrawal by the caveator
  • Court can order removal of the caveat 
  • Cancellation by the registrar
  • The caveat can lapse, and will lapse 3 months after the lodgement of the caveat (if steps are not taken to secure the caveat)

Prior to the caveat lapsing, the registered proprietor can issue a notice to commence court proceedings or bring an application to the Supreme Court of Queensland in extreme circumstances if they wish to remove the priority interest from their property. If taken to court, the caveator must demonstrate a genuine arguable case, that is that they have a genuine interest in the land. If this step is satisfied, the court will consider whether the balance of convenience supports the removal, based on different factors such as the strength of the caveator’s claim against the registered proprietor. The court will then generally make an order as to which party should pay legal costs. 

What are examples of a caveatable interest?

A caveatable interest means that you have a legal or equitable interest in the land.

  • An equitable lease
  • An equitable mortgage 
  • An option to purchase the property
  • An easement
  • An encumbrance
  • An interest to purchase the property under a contract for sale
  • Contributing to the purchase of the property
  • Improving the property

What are the two types of caveats?

There are two types of caveats, absolute and permissive. An absolute caveat does not allow any further dealings with the caveated property until the caveat is removed. A permissive caveat allows further dealings with the property upon permission of the caveator. 

How long does a caveat on a house last for?

Generally, a caveat on property can last for anywhere from 14 days to 3 months. Notwithstanding, a caveator taking action can modify the time frame so that their interest will remain effective until the court determines any property disputes.

What is a caveat on a title?

A caveat on a title is another way of mentioning that caveats are registered on title, with the Registrar. This has the effect of preventing any other party from affecting the caveator’s priority interest.

If you require further assistance with anything related to caveats, you should seek legal advice. Legal Kitz can direct you with your next step, whether you need assistance removing a caveat, or if you are unsure of whether to lodge one. Our Legal Kitz business specialists can assist with ensuring that your concerns are addressed, and can provide you with advice that is tailored to your situation. You can book a free 30-minute consultation via our website now.

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