My name is not on the title of the former matrimonial home and I am afraid my former partner will sell the property - what do I do?

A caveat is a registerable instrument that effectively prevents any further dealings on the title of a property (i.e. a property with a caveat cannot be transferred or re-mortgaged until the caveat is removed). Caveats can be lodged quickly and inexpensively; however, care must be taken that a caveat is not lodged in circumstances where the caveator does not have a ‘caveatable interest’. 

Family law context

In the context of family law, caveats are most commonly used as a mechanism to preserve the property of the relationship pending the resolution of a dispute. However, the mere fact of the existence of a marriage or de facto relationship does not give rise to a caveatable interest. Nor does the fact that family law proceedings are on foot (the Family Law Act 1975 adjusts property interests, rather than creating interests).

The most commonly claimed caveatable interest between former spouses is the existence of an implied trust. Whether an implied trust has arisen is a question that will turn on the facts of each individual case, however the following matters may be indicative:

1. Pooling of financial resources and/or contribution to mortgage payments;
2. Non-financial contributions to the property;
3. The spouse that provided the purchase monies for the property not being registered on the title. This was a once common practice by those in ‘risk professions’.

What if my former spouse has lodged a caveat against my property?

Generally, a caveat will be removed with the consent of the caveator as part of a final settlement. If an agreement is unable to be reached or there is some urgency, you will need to take steps to have the caveat removed.

Section 89A Application

This is an application to the Registrar of Titles for a ‘lapsing notice’ to be given to the caveator. Upon receiving the notice, the caveator has 30 days to issue proceedings to substantiate their claim. If they do not do so, the caveat will simply lapse.

In order to make this application, a lawyer must certify that, in their opinion, the caveator does not have the interest in the land that they are claiming.

Section 90(3) Application

In circumstances where there is some urgency (for example, the property subject to the caveat has been sold to an independent third-party purchaser and settlement is approaching) applications should be made to the Supreme Court under section 90(3) of the Transfer of Land Act.   In these proceedings, the caveator must show that there is ‘a serious question to be tried’ as to their asserted interest in the land and that the balance of convenience justifies the maintenance of the caveat. If the caveator cannot demonstrate these two factors, the court will order that the caveat be removed and costs consequences may follow.

There can be serious consequences for lodging a caveat without a reasonable basis for doing so.

Coote Family Lawyers are recognised as one of the top family law firms in Australia. We can assist you in determining whether you have a caveatable interest that requires protecting by lodging a caveat. Call us today on 03 9804 0035.

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