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What is a caveat?

A caveat is a type of statutory injunction preventing the registration of particular dealings with real property. A caveat acts as a warning or formal notice to tell the public that there is an interest on the land or property for a particular reason.

The word caveat means ‘beware’ and lodging a caveat on real property warns anyone dealing with the property that someone has a priority interest in that property. The party who lodges a caveat is known as a caveator. In this article, we explain how to lodge a caveat and why you may need to do so.

 

Reasons for Lodging a Caveat

If you have an estate or interest in land through which registration of another dealing cannot protect, you may consider lodging a caveat to protect your legal position. This is known as a caveatable interest. You must ensure that you have a genuine interest at the time you are lodging the caveat.

Caveatable interests include:

  • a registered or equitable mortgage,
  • transfer,
  • a purchaser under an agreement for sale,
  • a tenant (in certain circumstances),
  • a registered proprietor and contractual rights.

Each state and territory has an individual system of lodging caveats. For example, in Queensland, the Land Title Act 1994 (Qld) governs caveats. When a caveat is lodged at the Department of Natural Resources and Mines, it effectively prevents the registration of further dealings on the property’s title until:

  • the caveat is formally withdrawn by the caveator;
  • the caveat lapses;
  • the caveat removed by a court order; or
  • the caveator consents to another’s registration that deals with the property’s title.

Any person with an interest in land or wishes to claim an estate may lodge a caveat. A person who has an Australian court order restraining the registered proprietor from dealing with a property can also lodge a caveat.

What Detail Does a Caveat Require?

In Queensland, when lodging a caveat, you need to include:

the caveator’s name and residential address or registered office, including an address where notices can be served;

  • the name and address of the registered proprietor (we recommend that you complete a title search to ensure this information is correct);
  • reference details for which the caveat relates;
  • particulars of the legal or equitable estate of interest; and
  • the signature of the caveator, lawyer or another agent of the caveator.

What if I incorrectly lodge a caveat?

Only a person who has a caveatable interest can lodge a caveat. Lodging a caveat without reasonable cause is a serious matter.

A court may order you to compensate any person who suffers a financial loss as a result of your incorrect caveat.

 

Challenging or Removing Caveats

A caveat can be challenged or removed in a number of ways, including the property owner issuing a lapsing notice or the caveator submitting a withdrawal of caveat form.

 

Takeaways

Lodging a caveat allows you to protect an interest in property, such as a registered mortgage.

Before lodging a caveat, take steps to ensure you have a caveatable interest in the property.

Otherwise,  you may be liable to pay compensation to the wronged parties.

 

This article was written by Ben Webster, Commercial Lawyer at GKS Law.

Ben leads the Commercial Law team and is available for appointments at both the North Lakes Law Offices and the Redcliffe Law Offices.  

If you need advice on your caveatable interest or assistance with drafting a caveat, call GKS Law.

You can contact Ben or any of the Commercial Law team by email on mail@gkslaw.com.au or call the office on 07 3284 5093.