If you are an owner of a property that has a caveat placed on it, this may restrict what you can do with that property. It is important to understand what caveats mean for you and how to deal with them.
What is a caveat?
A caveat is like a ‘red flag’ that is placed on the certificate of title of a property by a person (the caveator), who potentially has an interest in the property.
Caveats can prevent you from registering an instrument (e.g. a mortgage or sale of the land) or can require that any instrument recognises the caveat. Alternatively, a caveat can require you to give notice to the caveator before you register an instrument.
How is a caveat lodged?
A person can lodge a caveat by submitting a form and supporting documentation to Landgate. If the documents meet the requirements, Landgate will register the caveat on the property.
Why are caveats lodged?
A caveator can be a person or corporation with an interest in your land that they would like to protect. It is up to the court to decide what is a ‘caveatable interest’ is, however some examples are:
- a mortgagee.
- a tenant of the land.
- a person who has an easement over the land.
- a person who holds an unregistered instrument in relation to the land.
- a person who has the right to a restrictive covenant.
- a person entitled to an annuity charged on the land.
- a person who has the right to take some natural product of the land.
What if someone places a caveat on your property?
A caveat will be removed if the caveator withdraws it. However, if it isn’t withdrawn, you have the option to lodge an application with Landgate for it to be removed. Once the application is accepted, the caveator will be given 21 days notice within which to act. They can either withdraw it or seek an order from the court for it to be extended.
If the caveator does not act within 21 days, then the caveat will be removed.
If a court finds that the caveator acted unreasonably in lodging the caveat, the caveator may be liable to compensate you for any damage that this caused.
If you are uncertain about what a particular caveat means for you and how you should proceed, you should seek legal advice from a property lawyer.
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