NSW Can you be sued if you have a valid property caveat

[david_mb]

Hi, my question is if you have a valid property caveat (we loaned money to a family member to help buy a property) can you be sued if you refuse to remove it when the mortgagee attempts to sell it (ie property has been repossessed) ?

We are trying to recover our loan but it looks like there will be little or no money left after the mortgagee has been paid.

Also if we are not forced to remove the caveat how does the situation typically get solved ?

Thanks

 

[Paul Cott]

Hi, my question is if you have a valid property caveat (we loaned money to a family member to help buy a property) can you be sued if you refuse to remove it when the mortgagee attempts to sell it (ie property has been repossessed) ?

We are trying to recover our loan but it looks like there will be little or no money left after the mortgagee has been paid.

Also if we are not forced to remove the caveat how does the situation typically get solved ?

Thanks

Hi David,
You wouldn’t be sued as such if you refuse to remove a caveat but you can possibly have costs awarded against you if you do so and the court says your refusal was unwarranted, as in, you did not have a caveatable interest. You should get legal advice on that particular issue.
The situation often gets resolved by negotiation between the parties.
Hope that helps. Paul Cott

 

[Rod]

The situation often gets resolved by negotiation between the parties.

In other words - you negotiate to remove the caveat when certain conditions are met. Typically repayment of the money at settlement. This agreement is given to the lawyer for the seller/mortgagee who arranges to pay you directly from settlement monies if any left after the mortgagee takes their money and costs.

 

[david_mb]

Ok thanks very much, but what stops you "negotiating" (ie refusing to remove caveat and blocking the sale) until you get paid the amount your owed even if that amount is more than the "monies left" (assuming we do have a caveatable interest) ? Do you know of any cases where the mortgagee has paid this extra amount to make the problem (caveat) go away ?