A caveat in property has been processed and accepted by the SLA will take effect from its date of lodgement. Learn to know more!
What Is a Caveat: an Overview
A caveat is a legal document lodged with the Singapore Land Authority (SLA) by a person with an interest in the property (or land). The caveator, who files the caveat, is known as the caveator, while the person to whom the caveat is addressed is the caveatee. A caveat protects the owner of property from certain people buying the property from a third party without their permission. A caveat is a legal document that protects a person’s legal right to exclusive ownership of property.
When Are Caveats Filed in Singapore? Why Would One Place a Caveat on a Property?
In Singapore, if you want to make sure no one sells or messes with a property or asset you’re interested in without telling you, you might file a legal notice called a caveat. This is common in different situations, like when a property is about to be sold, if there’s a fight over who owns it, or if someone’s supposed to get something from it in the future, like from a will.
In the business world, people use caveats too. For example, if a company shareholder doesn’t like a big decision, like merging with another company, they might file a caveat. Creditors, or people the company owes money to, might do it to claim some company assets if they’re worried about getting paid back. Caveats are also used in personal matters, like when dealing with the property of someone who’s passed away, to make sure all debts or promises are settled first. Because there are so many reasons and ways to file caveats, it’s smart to talk to a lawyer to get it right, especially since the rules can be pretty specific.
Who Is Eligible to Lodge a Caveat in Singapore?
A caveat may be lodged by any party that claims an interest in the property under the Land Titles Act. Among these parties are:
- A buyer who has made a deposit on a certain property
- A bank that has made a mortgage loan to the property owner or buyer and submits a caveat as the mortgagee
- When the CPF Board releases CPF monies from the property owner’s or buyer’s CPF account(s) and submits a caveat in its capacity as a charger
Duration of a Caveat Lodged
A caveat accepted by SLA is normally effective for 5 years from the date of filing. However, if a transaction banned by the caveat is lodged (for example, if the existence of a caveat forbids the registration of any document affecting the property yet someone attempts to register, say, a lease or a mortgage), SLA will alert the caveator.
The caveator then has 30 days from the date he is notified by SLA to seek a court judgement prolonging the caveat’s operation. The unlawful transaction will also be prevented from proceeding. If such a court order is not obtained, the caveat will expire after 30 days and the transaction will be registered.
How Do I Withdraw a Caveat Lodged?
A caveat can be removed by the caveator in respect of the entire property subject to the caveat (i.e. total caveat withdrawal) or just part of the property (i.e. a partial withdrawal of caveat).
To withdraw a caveat, submit the appropriate form (either a total withdrawal form or a partial withdrawal form) via STARS eLodgement. This is normally done on the caveator’s behalf by a lawyer. A sample total withdrawal form and a sample partial withdrawal form can be found here and here, respectively.
What Happens If My Application to Lodge a Caveat is Unsuccessful?
Unfortunately, the outcome of an unsuccessful caveat application can vary depending on the specific jurisdiction and reason for rejection.
Notification:
You will typically receive a formal notification from the relevant authority (e.g., Land Registry, court) explaining the reason for rejection.
Possible Reasons for Rejection:
Deficient application: This could include missing information, incorrect details, or grounds for a claim deemed unacceptable. If this is the case, you might have a limited window (e.g., 14 days) to rectify the application and avoid withdrawal.
Insufficient grounds: Your claim might not have sufficient legal basis or evidence to support it.
Competing interests: If another party has a stronger claim to the property or asset, your caveat might be unsuccessful.
But, here is what you can do:
Seek legal advice: Understanding the specific reason for rejection and your options requires professional guidance. A lawyer can assess your case, advise on potential remedies, and represent you if necessary. Vakilsearh experts can help.
Negotiate: Depending on the situation, you might be able to negotiate with the other party involved to reach a mutually agreeable solution.
Appeal: In some cases, you may have the right to appeal the decision. However, this process can be complex and time-consuming, so seeking legal advice is crucial.
How Do I Extend a Caveat Lodged?
Before a caveat expires, the caveator’s lawyer may apply to SLA for an extension on his or her behalf by submitting an online extension of caveat form using STARS eLodgement. A sample of the caveat form extension can be obtained by getting in touch with the experts at Vakilsearch for a free consultation.
If the extension application is approved by SLA, the caveat will be valid for another 5 years from the day the extension of the caveat form is submitted.
What If a Caveat Is Lodged on a Property I Want to Purchase?
If you discover that the property you want to purchase has a caveat lodged against it, the owner of the property (i.e. the prospective seller) can, in his capacity as caveatee, resort to the following remedies:
- Obtain a court order for the caveat to be removed; or
- Apply to the SLA through STARS eLodgement to cancel the caveat, on the basis that the caveat had been lodged vexatiously or frivolously or not in good faith. Once the application has been made, SLA will inform the caveator.
Within 30 days of SLA’s notification, the caveator has to obtain a court order for the caveat to remain on the land register, failing which, the caveat will be cancelled.
Before you sign the papers to buy a house in Singapore, Vakilsearch lawyers will conduct a title search to confirm that there are no pre-existing caveats on the property. This is because such restrictions may prevent you from becoming the new owner of the property.
The Takeaway
Lodging or removing a caveat on a property in Singapore can become complex, depending on the specific details and legal conditions surrounding the property. A caveat acts as a formal notice that someone has an interest in the property, which effectively prevents any dealings or transactions with the property without informing the person who lodged the caveat. The complexity in this process often arises from the intricacies of property law, the nature of the individual’s interest in the property, and potential disputes that may be involved. Understanding and navigating these complexities requires a thorough grasp of the legal procedures and documentation involved.
For individuals facing challenges with lodging or removing caveats, seeking professional legal assistance is advisable. Vakilsearch, known for its team of experienced solicitors, provides specialized services in this area. Their expertise can be particularly helpful in ensuring that your interests are well-protected and that the process is handled efficiently and correctly. Whether you need to secure your claim on a property by lodging a caveat or need assistance in removing one to facilitate a transaction, consulting with a legal expert from Vakilsearch can streamline the process and help avoid potential legal pitfalls.
FAQs
How much does a caveat cost in Singapore?
Lodging caveat cost in Singapore is around 64 Singapore dollars, which is around ₹3970. The exact amount you end up paying in rupees could vary slightly based on the exchange rate your bank or payment provider applies. Additionally, for international transactions, some banks or payment services may include extra charges.
How long does a caveat last in Singapore?
When you put a caveat on a property, it's good for five years at first. This gives you plenty of time to sort out whatever issue made you file the caveat, like a disagreement or a legal step that needs to be finished. If you haven't resolved the issue by the end of the five years, you can ask for more time. You just need to apply for an extension, which will give you another five years, and pay a fee of S$64.45. You can keep extending it like this as long as you need to, as long as you have a good reason for the caveat to stay in place.
How do you challenge a caveat in Singapore?
To challenge a caveat, you can dispute the caveator's claim by showing evidence that their interest in the property is not valid or strong enough to need a caveat. If this doesn't solve the issue, you can ask a court to remove the caveat, which might involve legal arguments and possibly a court hearing.
What is the purpose of filing a caveat?
The main purpose of filing a caveat is to let authorities and others know you have an interest in a property or asset, which stops actions like selling the property without telling you. It also protects your claim on the asset while any disagreements or legal matters are being sorted out.
What happens if a caveat is filed?
Once a caveat is filed, it temporarily stops any transactions with the property, like selling or transferring it, which means the owner can't deal with the property freely. This might lead to talks with the person who filed the caveat or even legal action to fix the issue behind the caveat.
Can a caveat be filed without a lawyer?
While it's possible to file a caveat without a lawyer, due to the legal complexities and risks, it's strongly advised to get help from a professional. Lawyers can help with the process, make sure all documents are correct, and represent you in talks or court.
Can a property be sold with a caveat?
Selling a property with a caveat on it is tough because it makes buyers wary and can delay the sale. You might need to talk to the person who filed the caveat and convince them to remove it, or you might have to go to court to get the caveat lifted before you can sell the property.
