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How To Remove a Caveat Over Your Property?

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What Is a Caveat

A caveat acts as formal notice or a warning that someone has a priority interest in a property.

Caveats are a complex area of civil litigation. Our Brisbane litigation lawyers have expertise in these types of disputes.

When To Engage a Litigation Lawyer

Aitken Whyte Lawyers can assist you to:

• remove a caveat over the title of your property or land; or
• lodge a caveat over a property title.

Removing A Caveat

If someone has lodged a caveat over the title of your property, our lawyers can assist you to have it removed. We can achieve this either through negotiation or by applying to the Supreme Court.

We discuss each of these options below.

Lodging A Caveat

If you would like advice on lodging a caveat, our law firm can assist with that also. 

We will first determine whether you have a caveatable interest in the property. This is important, as otherwise, the caveat can’t be maintained and is at risk of an adverse order.

See our article about lodging a caveat for more information.

Seek Legal Advice at The Earliest Opportunity

It is imperative that you take immediate action to protect your rights. This applies whether you need to lodge a caveat to protect your interest in a property or remove a caveat.

Call us on 07 3229 4459 to speak to an experienced civil litigation lawyer.

The Effect of a Caveat on Your Property

If you own land in Queensland and someone has lodged a caveat over the land, this will generally prevent you:

• from transferring the land; or
• otherwise dealing with the land.

This means you will likely not be able to sell your property while the caveat is in place.

These restrictions end if the caveat is withdrawn, removed, lapses, or is cancelled.

The Parties Involved

As the owner of the land, you are known as the “caveatee“. The person or entity putting the caveat on your property is known as the “caveator“.

The caveat is registered at the Titles Office. The Titles Office is also called the Department of Natural Resources and Mines, or DNRM.

When Caveats Lapse

To preserve the caveat where there is a dispute, the caveator (the person that lodged the caveat) must:

1. commence Court proceedings against you within 3 months; and
2. give notice to the Titles Office of the Court proceedings once they are commenced.

If the caveator does not complete both steps, the caveat will lapse. The Registrar of Titles may then remove or cancel the caveat from the property’s title.

In some instances, if a caveat is lodged with the owner’s consent, it may not lapse within 3 months from registration.

One Caveat Per Interest

Without the leave of the court, the caveator is not permitted to lodge a similar caveat claiming the same interest in the same land:

• after a caveat is cancelled;
• after a caveat is removed; or
• after a caveat lapses.

If they do not take steps to maintain their caveat, they will not be able to simply lodge another.

How To Have a Caveat Cancelled or Removed Before It Lapses

There are steps you can take to have a caveat cancelled or removed without having to wait for it to lapse. Our lawyers can guide you through these as well as offer advice on the best option in your circumstances. These options include:

1. Issuing a notice to commence court proceedings

Three months is a long time to wait for a caveator to commence Court proceedings.

A caveatee (person who owns the land) can send a notice to the caveator demanding:

• that the caveator commence any Court proceedings within 14 days; as otherwise
• the caveat will lapse.

The Registrar of Titles may then remove or cancel the caveat if the caveator does not, within 14 days:

• commence Court proceedings; and
• notify the Titles Office.

Our solicitors can assist you to:

• prepare and serve a notice on the caveator; and
• notify the Registrar of Titles that a notice has been served in the required form and timeframe.

We have significant experience successfully giving notice to caveators to commence proceedings.

2. Bring an application to the Supreme Court of Queensland

A more aggressive option that a caveatee has is to bring an application to the Supreme Court.

You can apply to the Supreme Court of Queensland for an order to remove the caveat. This can be done without giving the 14 days’ notice to the caveator.

A caveatee may apply even after the caveator has commenced Court proceedings.

The application to the Supreme Court is made under section 127 of the Land Title Act 1994 (Qld). This section states:

“(1) A caveatee may at any time apply to the Supreme Court for an order that a caveat be removed.

(2) The Supreme Court may make the order whether or not the caveator has been served with the application, and may make the order on the terms it considers appropriate.”

Section 127 of the Land Title Act 1994 (Qld)

Our lawyers have run many Court applications to have caveats removed. Some examples include:

• Removal of a caveat over a property development site; and
• Removal of a caveat lodged due to a loan agreement between our client and another solicitor.

What The Caveator Must Demonstrate to The Court

When a caveatee applies to Court to remove a caveat, the caveator bears the onus to demonstrate:

• a genuine arguable case; and
• that the balance of convenience favours the continuation of the caveat.

Genuine Arguable Case

A caveator must demonstrate that they have a genuine arguable case. To do this, they must show that they have an interest in the land the subject of the caveat.

A debt owed by the owner of a property to the Plaintiff does not give the creditor a caveatable interest. The Court ought to remove such a caveat on an application by the caveatee.

The Land Title Practice Manual (Queensland) sets out practices for preparing titles forms. It details some past cases where the caveator could not prove a caveatable interest. These include the following:

• A vendor’s lien for unpaid purchase money (see section 191 of the Land Title Act).
• A registered owner of land who:
• sought the appointment of statutory trustees for the sale of the land; once having
• executed a Form 1 – Transfer to Trustees; and
• divested himself/herself of the legal estate.
(See Re Trapas Pty Ltd [1991] Q Conv R 54-398)
• Property developed with the use of funds lent by the caveator where there was an agreement to:
• share in the profits on resale of the land; but not
• give the caveator security over the land for the loan.
It was found that this did not confer on the caveator an interest sufficient to support a caveat (see Simons v David Benge Motors Pty Ltd [1974] VR 585). [There is some case law to support an alternate position concerning business partnerships. This is a proposition that a partner in a partnership that owns land has a caveatable interest in the land].
• An application under section 196 of the Property Law Act 1974 for relief. The caveator alleged that he mistakenly made improvements on the caveatee’s land. This was held not to be a sufficient interest to support a caveat (see ex parte Goodlet and Smith Investments Pty Ltd [1983] 2 Qd R 792).
• A mere right of pre-emption was held not to be sufficient interest to support a caveat (see Re Rutherford [1977] 1 NZLR 405).
• A beneficiary under a discretionary trust. It was found such a beneficiary does not have an interest in land owned by the trust that will support a caveat (see Walter v Registrar of Titles [2003] VSCA 122).

Balance Of Convenience Test

This is the next step if the caveator can establish that it has a caveatable interest in the property. Following this, the Court will consider whether the balance of convenience supports removal.

Many different factors can affect the balance of convenience. Some common factors the Court will consider in a balance of convenience argument are:

• any undertaking as to damages offered by the caveator;
• any undertaking not to deal with the property offered by the caveatee;
• any other available security for the caveator apart from the property;
• the strength of the caveator’s claim against the caveatee;
• whether the caveatee is seeking to dispose of the property and those circumstances;
• whether other parties are affected by the caveat, for example, buyers of off the plan lots.

Legal Costs

Following an application to remove a caveat, the Court will usually make an Order about costs.

If the caveat is removed, the caveator will likely have to pay the costs of the caveatee who applied to the Court.

Such a costs Order could have a big effect on the caveator and even influence the outcome of the litigation.

If a costs Order is not paid by the caveator, there are further strategies that we can advise on, such as:

• seeking a stay of the proceedings until the costs are paid; or
• applying for security for costs.

If you own a property that has been caveated and you want the caveat removed, we can assist.

Please contact us for legal advice on the best way forward in your circumstances.

Our solicitors can also assist if you are looking to put a caveat on a property to protect your interests.

Focused On Results

It’s essential you have experienced solicitors when dealing with:

• caveats; and
• property law disputes.

Our lawyers are experienced in dispute resolution. We can advise you on the best way to negotiate or mediate a favourable outcome. In the event this does not resolve your property dispute, we will take all action to reach a resolution. Whether you need to commence or defend Court proceedings, we can assist you to get the Orders you require.

Aitken Whyte Lawyers Brisbane can assist with:

• all property and caveat related disputes; as well as
• many other commercial or civil disputes.

Call us today to discuss your matter with a civil litigation lawyer.

Office Location and Contact Details

Brisbane

Aitken Whyte Lawyers Brisbane
2/414 Upper Roma Street
Brisbane QLD 4000

Ph: 07 3229 4459
Fax: +617 3211 9311
E: enquiries@awbrisbanelawyers.com.au