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Can I lodge a caveat?

Many clients often ask us this question, “can I lodge a caveat over someone else’s property?”

The need for registering a caveat over someone else’s property often arises for various reasons, including:

  • to tell the world that they have an interest in the property and that such interest is preserved
  • to prevent any further mortgage being registered over the property
  • to prevent any unauthorised dealing (including sale) with respect to the property etc

You may often find that even if you may have reasons to believe that you should register a caveat over somebody’s property, you may not be legally entitled to do so.

Whether or not you are entitled to register a caveat over a property depends on whether you have a caveatable interest in the property. Any caveat over a property must be supported by a caveatable interest in the property.

A Supreme Court NSW decision in the case of Harry Bernard Thynne v Jevny Pty Ltd and Anor [2022] NSWSC 1774 illustrates how this requirement may apply.

  1. Key relevant facts
    • James married Catherine in 1982 and Harry was born to them in 1983.
    • James and Catherine divorced in 1990.
    • In 1996, James married Victoria.
    • James and Victoria had a son named Patrick, born in the same year.
    • James died on 22 June 2011. He left a will dated 25 March 2011.
    • James owned a property in Darling Point (Darling Point Property).
    • Under James’ will, James left the Darling Point Property to Victoria subject to her agreement (which was accepted by Victoria) that she would leave the property, or any proceeds of sale remaining at her death, to Harry and Patrick in equal shares.
    • On 27 July 2022, Harry Sued Victoria (amongst others) seeking relief which includes a declaration that Victoria holds the Darling Point Property on trust for him and Patrick in equal shares.
    • On 27 October 2022, Harry lodged a caveat on the title of the Darling Point Property claiming an interest in the land as the beneficiary under a trust.
  1. Key issue to be determined by the Court
    The key issue which the Court was asked to determined was whether the caveat lodged by Harry on the Darling Point Property was supported by a caveatable interest.
  2. Judgment
    The Court found that Victoria had “the floating obligation which will crystallise into a trust on what is left of the Darling Point Property or its proceeds on Victoria’s death” and that “Harry has no trust interest now”. Hence, Harry did not have a caveatable interest in Darling Point Property, and the caveat must be discharged.
  3. Key takeaways
    This case illustrates the importance of understanding what caveatable interests are and the legal requirement that any caveat must be supported by a caveatable interest.

This article (or any part thereof) does not, and is not intended to, constitute legal advice; instead, it is for general informational purposes only. If you have any questions, please contact our lawyers on +612 8599 6999.

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