Securities

Our solicitors have substantial experience with mortgages over real property in Queensland. We can assist with:

1. The preparation and registration of mortgages on the title to real property in Queensland;
2. Advice in relation to the terms of the mortgage, and the rights of the mortgagor and mortgagee;
3. Giving and responding to notices of exercise of the mortgagee’s power of sale;
4. Seeking Court orders giving owners relief from their obligation to immediately repay the entire mortgage debt due to their default;
5. Appointing receivers to receive the mortgaged property’s income and sell the property;
6. Seeking Court orders restraining the exercise of the mortgagee’s power of sale.

A caveat is an instrument under the Land Title Act 1994 (Qld) for preventing (among other things) the owner from transferring their real property to another. A caveat cannot be lodged without proper grounds on which to claim an interest in the affected property. Inserting a charging clause into a contract is one of the most common ways to create proper grounds for lodging a caveat. However, proper grounds for lodging a caveat can also exist in other circumstances, such as:

1. Where the owner fails to comply with their contractual obligation to execute a mortgage in favour of their creditor if requested to do so;
2. Where it was intended that the person lodging the caveat would acquire an interest in the property upon:
   1. Paying for all or part of the owner’s interest in the property;
   2. Transferring property to the owner; and
3. Where the owner should be prevented from enjoying all or part of the property through unconscionable conduct such as:
   1. 1. Dishonestly acquiring property despite actual or constructive notice of an earlier interest in the property;
      2. Obtaining property by acting in conflict with fiduciary duties, or by making unauthorised use of a fiduciary position;
      3. Refusing to fulfill the promise of an interest in property to a person who relies on that promise to their detriment.

Lodging a caveat does not enable the lodger to sell or transfer the property to someone else. Court orders are required to enable that. The caveat will lapse unless Court orders establishing the interest claimed in the caveat have been sought, and the registrar of titles is given notice of that, within 3 months of lodging the caveat, or within 14 days of being given notice to seek such orders by anyone with an interest in the property. If a caveat lapses, anyone in the world can lodge an instrument requesting its cancellation.

Lodging a caveat is not without risk. Anyone with an interest in the property can apply to the Supreme Court for an order that the caveat be removed from the title to the property. If that happens, the caveat lodger bears the onus of demonstrating to the Court that:

1. They have a prima facie claim which would justify the continuation of the caveat; and
2. The balance of convenience favours the caveat being maintained.

The caveat lodger will also need to give an undertaking to the Court to compensate any damage caused by the caveat if required.

If a caveat is lodged or continued without reasonable cause, the lodger must compensate anyone else who suffers loss or damage as a result. The Court can also order the lodger to pay exemplary damages, to punish them for lodging the caveat and deter others from doing such things.