What we need to know about Property Caveats

Where a party has an unregistered interest in a piece of land, a caveat can be lodged in order to provide notice of such an interest and to protect it against any further dealings with the property until registration can be made.

When assessing whether a caveat will be accepted or deemed as valid, it is important to consider the question as to whether the caveator has a ‘caveatable interest’. Here is a non-exhaustive list of interests that are sufficient in upholding the lodgement of a caveat; holder of equitable mortgage in the land, unregistered party of a marital residence or a party benefitted by an easement. All interests, however, are not adequate reasons to lodge a caveat, for example, an unsecured claim for a debt that was not incidental in purchasing the land, holding a licence in relation to the land and a right of pre-emption will not render a party in a position to lodge a caveat. Furthermore, there are generally only two types of caveats that can be lodged, these are; absolute caveat and permissive caveat.

In short, an absolute caveat does not allow subsequent registrations of interests while a permissive caveat will allow further registrations, conditional upon them being made subject to the initial caveat. While the absolute caveat offers vast and cemented protections, its requirement threshold is quite high. This is because, generally, a caveator can not lodge a caveat that goes beyond the legitimate claim necessary to protect the caveator’s rights. Therefore, there must be adequate reasoning and circumstances surrounding the lodgement of an absolute caveat . Additionally, if the proper reasoning does not accompany the caveat, the lodging party maybe punished through compensation orders to the relevant party. Therefore, it is imperative that you choose the type of caveat wisely, as this will play a significant factor in whether or not it will be accepted.

A specific case where absolute caveats can be accepted is through the aforementioned example of an unregistered party of a marital residence. Furthermore, in circumstances where your claim is lesser in connection than this, a permissive caveat is likely to be more appropriate.

Lastly, it is imperative that the lodgement of a caveat is done so quite meticulously. This is because any error or mistake in the lodgement process or application can result in the caveat being automatically rejected. Furthermore, in instances where a caveat is deemed to have been lodged unnecessarily, the caveator may be liable to pay compensation.

If you would like assistance in lodging caveats, dealing with registerable interests or disputes in relation to property, Straits Lawyers are here to help. We are now offering online services in both English and Chinese.



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Please note that this article does not constitute legal advice and Straits Lawyers will not be legally responsible for any actions you take based on this article.