The family home is in my ex-partner's sole name and they've listed it for sale – what do I do?'
We have received this panicked phone call on many occasions. Usually, the answer includes lodging a caveat.
What is a caveat?
A caveat is a notice that appears on the title of a property that protects your unregistered interest in the property and essentially prevents the registered owner (in this case your ex-spouse) from dealing with the property; that is, selling, transferring, mortgaging or encumbering the property.
A caveat is not a substitute for being the registered owner of a property; rather, it is a short term measure that prevents your ex-spouse from adversely dealing with the property until the court decides whether you have an interest in the property.
When should you lodge a caveat?
In family law matters, the common circumstances where we would recommend the lodgement of a caveat are:
- the property is in the sole name of your ex-spouse
- there is a risk your ex-spouse will sell, transfer or encumber the property
- the circumstances of the relationship are such that a property adjustment between you and your ex-spouse is just and equitable (that is, the court is unlikely to order that each party keep their own assets and there be no adjustment of property).
Of course, each matter will turn on its own facts and there are other circumstances where lodging a caveat will be appropriate.
How do you lodge a caveat?
In Queensland, a caveat is lodged by depositing the appropriate form (signed by you or your lawyer) at the Titles Office.
A caveat requires careful drafting because it must state the interest claimed by you and the grounds on which your interest is claimed.
Parties without the benefit of legal representation often fall into error when drafting the grounds themselves, because things like 'a just and equitable property division' are not caveatable interests and the Titles Office will most likely reject the caveat by issuing a requisition notice.
When you lodge a caveat it is important you do it correctly the first time, as you will only have one opportunity to lodge a caveat for each caveatable interest. You cannot lodge another caveat on the same or substantially the same grounds unless you obtain leave from the court, which will only be granted in limited circumstances.
If it is not done correctly the first time, you may lose the opportunity to protect your interest in the property.
It is also important to be aware that, if a caveat is lodged without valid grounds, damages may ultimately be awarded against you by a court.
What should I do after a caveat is lodged?
Once the caveat is lodged, a notice will be sent by post to your ex-spouse.
Your ex-spouse may then serve a notice on you requiring you to commence court proceedings to establish the interest you have claimed under the caveat.
If this notice is served, you must:
- commence court proceedings within 14 days
- notify the Titles Office Registrar within 14 days after the notice is served, that proceedings have commenced.
Unless this is done within the 14 day time frame, the caveat will lapse.
If no notice is served, the caveat will still lapse three months after lodgement, unless proceedings are commenced and the Registrar is notified.
It is important that these deadlines are not missed because you cannot lodge another caveat on the same or substantially the same grounds.
It is also important that, if proceedings are commenced, the orders sought seek to establish the interest claimed under the caveat. Simply commencing proceedings without seeking the appropriate relief will not be sufficient to prevent a caveat from lapsing.
How do you get rid of a caveat?
If the caveat has lapsed, the ex-spouse can lodge a form at the Titles Office to remove the caveat.
Alternatively, a caveat can be withdrawn by the person who lodged it. Usually, this would only be done as part of final property settlement orders being made.
Do you need advice about lodging a caveat?
The tactical advantage that can be gained by lodging a caveat, and the consequences of not acting quickly enough or making mistakes drafting a caveat, can have a huge impact in a family law matter, so it is important to obtain expert legal advice.
Cooper Grace Ward is a leading Australian law firm based in Brisbane.
This publication is for information only and is not legal advice. You should obtain advice that is specific to your circumstances and not rely on this publication as legal advice. If there are any issues you would like us to advise you on arising from this publication, please contact Cooper Grace Ward Lawyers.