Caveats – Learn how they can protect you
What is a caveat?
A caveat is a statutory notice that is registered against a property. It serves as a notice that the person lodging the caveat (‘the caveator’) has an interest in the land. One purpose of lodging a caveat is to prevent the land from being transferred or otherwise dealt by the owner of the land without the knowledge or consent of the caveator.
When can a caveat be registered?
Because a caveat prevents even the owner of land from dealing with their own property, only a person who has an enforceable interest in that property can justifiably lodge a caveat. Therefore, a caveat can only be lodged by a person who:
- Has an interest in the land by virtue of an agreement or any other instrument;
- Is transferring an interest in land to another person to be held in trust;
- Is an intending purchaser or mortgagee.
In order to be effective, a caveat should disclose the interest claimed. Common examples of when a caveat can be placed include the following:
- Interest of a purchaser where there is a contract for sale and purchase of land in instances where the purchaser has paid a deposit;
- Interest of a beneficiary of land that falls under the estate of a deceased person;
- Interest of a mortgagee where there is an agreement to mortgage land;
If a caveat has been registered without reasonable cause, the caveator may be liable for damages resulting from the wrongful lodgement of the caveat.
What is the effect of registering a caveat?
The effect of a caveat is that the Registrar of Lands and Deeds is forbidden to make any entry on the property which has the effect of mortgaging or transferring or affecting in any way the estate or interest protected by the caveat. The registered owner is therefore prevented from showing a clear title.
How can a caveat protect you?
If you are in the diaspora and buying property in Zambia, your lawyer should lodge a caveat against the property to prevent the owner from selling the land to another party or from offering the same property as security for a loan.
How can a wrongfully lodged caveat be removed?
You may come across a property that you want to buy and discover it has a caveat. The best approach is to find a property that is not encumbered and has no negative entries against it. However, if you wish to go ahead with the purchase then the seller should make efforts to remove the caveat by:
- Having the caveator to remove the caveat. If the caveator will not remove the caveat then by;
- Applying to the High Court to have the caveat removed.
Please note: that the above information is intended to provide general information only. The contents contained in this article do not constitute legal advice and should not be relied on as such. For legal advice please contact a licensed legal professional.