What is a Caveat?

A Caveat is a legal dealing registered over land, effectively an encumbrance over the land to limit certain transactions being done with the land and to warn others as to your potential interest in the land. A person who lodges a Caveat over a property is called a ‘caveator’.

What does a Caveat do?

A Caveat will stop most (but not all) dealings with the title to a property. A caveat will stop the registrations of further mortgages and also limit the sale of the property without court order.

Can I lodge my own caveat?

You can lodge your own caveat, however, lodging a caveat without expert legal advice can be risky, as you can become liable for the land owner’s damages and other costs if you improperly lodge a caveat. We recommend contacting Chamberlains expert Property Team.

What do I need to lodge a caveat?

For example, in most Australian jurisdictions you require:

  • Your name and address, including an address where notices can be served;
  • The property title details, name and address of the registered proprietor or owner of the property;
  • Details of your legal or equitable claim or interest in the land and reference details;
  • A statutory declaration; and
  • Proper execution of the caveat form by yourself, a lawyer or approved agent.

What are the risks of lodging a caveat?

  1. Lodging a Caveat when you do not have a sufficient rights can leave you liable for damages. Those damages could be substantial if your Caveat gets in the way of a transaction for the owner. Before lodging a Caveat, you should obtain advice as to whether or not you have sufficient grounds to lodge the Caveat.
  2. You can’t lodge a second Caveat on the same grounds. Consequently, if your Caveat lapses after a period of time, you can’t lodge a new Caveat on the same grounds.

How do I remove a caveat?

In NSW, you can either:

  1. If you are an owner of land, you can lodge a lapsing notice with the land titles office and put the pressure bank on the caveator to go to Court to justify why it remain on title.
  2. If you are a caveator, you can lodge forms to remove the title quite simply.
  3. The Court is also able to assist parties when there is a dispute.

Whenever registrations on title are concerned and there is a significant risk of Court involvement, I is vital you obtain proper legal advice. Though caveats can be an excellent tool to assist parties in securing their interests and even often getting paid, they are a deceptively complex area of law and proper legal advice is a must.