Defective Caveats

Thursday, March 2, 2017

It is important to ensure that you follow the strict legislative requirements when lodging a caveat. Otherwise, the caveat may be ineffective in protecting your interest in land.

What is a caveat?

A caveat is a notice registered on a certificate of title. A caveat can prevent buying, selling, registering a mortgage and other dealings.

Who can lodge a caveat?

All people and most companies can lodge a caveat.

Lodging a caveat

There are strict legislative requirements that must be followed to lodge a valid caveat. In Western Australia the, caveator must:

  • Have a caveatable interest; and

  • Comply with formal requirements.

Caveatable interests

Caveatable interests are interests in the land over which the caveat is lodged, and does not extend to personal or purely contractual interests. For example:

  • An interest as purchaser under an agreement for sale;

  • An equitable mortgage;

  • An unregistered mortgages; and

  • An easement

Protecting a caveat through Court Proceedings

In Western Australia, caveats do not lapse except as a result of a Registrar’s notice. This is where the Registrar gives notice to the caveator after an application is made to Landgate for the notice to be issued.

The Registrar’s notice will require the caveator to commence proceedings to protect and substantiate their caveat within 14 days. If the caveator fails to do so, the caveat will lapse.

Removing a caveat

A caveat can also be withdrawn at any time by the person who lodged it.

In cases where it is clear that the caveator has no caveatable interest in the land, the owner of the land may apply to Landgate to remove the caveat.

Common mistakes made by caveators

Below are some common mistakes made by caveators:

  • Have you paid the stamp duty with specific regard to the interest you seek to protect?

  • Has the description of land been accurately described including whether or not the caveat relates to the whole or part of the land?

  • Are you aware of the different time limitations for lapsing caveats in each State and Territory?

  • Are you the buyer of the premises where the sale of business and premises are under separate contracts?

  • Are you contractually bound not to lodge a caveat?

  • If the title or interest in the land is jointly acquired, have both parties lodged a caveat?

  • Have you prepared appropriate supporting material for proceedings in a timely manner so as to protect the caveat or to resist an application for removal?

Aherns Lawyers provides services on all caveat matters including the removal of caveats.

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