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Tasmanian Caveats

In Tasmania, along with other Australian jurisdictions, where a person has an interest in land that is not reflected on the title, they may lodge a caveat with the Recorder of Titles.  The person lodging a caveat is referred to as the “caveator”.


Doing so results in the registration of the caveat on the Certificate of Title. This notifies anyone seeking to deal with the property of the caveator’s interest. It also ensures that the caveator is made aware of any proposed dealings with the land, enabling it to challenge any dealing that is inconsistent with its interest. In this way, a caveat can be an effective means of protecting your interest in real property.


What is a caveatable interest?

A person wishing to lodge a caveat must have what is known as a caveatable interest. This requires either a legal or equitable interest in the property. Rights against the owner that are not related to the property do not typically amount to a caveatable interest. 


There are a range interests in property that entitle the interest holder to lodge a caveat. Examples include:

  • An interest arising under a contract of sale or a lease (e.g. if you have purchased or leased the property);
  • An unregistered mortgage;
  • An option to purchase the land; and
  • An interest arising pursuant to a trust.

If you do not have a legal or equitable interest in the land, a caveat is not an option for you.

Not only is an improperly lodged caveat likely to be removed on application by the owner of the property (see below), under section 138 of Tasmania’s Land Titles Act 1980, a caveator may become liable to pay compensation if it is found that the caveat was lodged ‘without reasonable cause’.


The High Court recently made it clear that a caveatable interest must exist at the time the caveat is lodged and that it is insufficient for the caveator to have issued proceedings that may result in a caveatable interest subsequently arising (see Boensch v Pascoe [2019] HCA 49). A significant degree of care must therefore be taken to ensure there is a demonstrable interest capable of supporting the caveat at the time it is lodged.


Does a debt amount to a caveatable interest?

If you are owed money by the owner of a property, and unless there is an underlying agreement already in place giving you rights in relation to the property, you do not generally have a caveatable interest. One exception is if you have obtained judgment against the debtor. In Tasmania, once this step has been taken, section 134 of the Land Titles Act 1980 provides that a caveat may be lodged on the title of any land owned by the judgment debtor. This is a unique statutory right that is not found in most other jurisdictions in Australia.


Where there is a valid security agreement in place, such as a mortgage or an equitable charge that has not already been registered, you will likely have a caveatable interest and indeed, a caveat is an effective way of protecting your interest.


How is a caveat removed?

Most commonly, a caveat is removed with the consent of the caveator. This usually occurs when the land that is subject to the caveat is being sold, or when the interest that is protected by the caveat is formally registered on the title, such as by way of a mortgage.


In Tasmania, the Land Titles Act 1980 provides a number of mechanisms for the removal of a caveat in circumstances where the validity of the interest it protects is disputed.


Section 135 of the Act provides that the owner of land affected by a caveat, or anyone else with an interest in the land, may apply to the Supreme Court for its removal. The onus is then on the caveator to establish the validity of the underlying interest protected by the caveat.


Alternatively, under section 136A, the owner of the land may apply to the Recorder of Titles for a notice to be issued to the caveator stating that the caveat will be cancelled following the expiration of twenty-eight days, unless an order is made by the Supreme Court extending the caveat.


Where a notice of this kind is received by a caveator, to protect the caveat (and the underlying interest), the caveator must issue proceedings in the Supreme Court within the specified period. Once proceedings are issued, the Court may make an order extending the caveat until the dispute is resolved. This will preserve the caveat pending the outcome of the proceeding. Once again, the onus is then on the caveator to prove the validity of the underlying interest it claims in the property.


How we can help you

If you have an interest in property affected by a caveat and you are seeking to have it removed, or you wish to lodge a caveat, you should first seek legal advice. You can speak to one of our lawyers by calling 03 6331 5922.

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