Caveats – Requirements under section 138 Land Transfer Act 2017

Caveats against dealings under section 138 of the Land Transfer Act 2017 are reviewed in a similar way to those registered under the former Land Transfer Act 1952.

The Land Transfer Regulations 2018 specify what prescribed information must be included in a caveat instrument presented for registration. It is important to ensure that:

  • all prescribed information is included, and
  • the caveator’s entitlement to the estate or interest claimed is set out sufficiently, whether the caveat is lodged manually or electronically through Landonline.

In Norrie (Cindy Sue) v Registrar-General of Land in the Wellington High Court (CIV 2004-485-2153 - Ellen France J. - 10/02/05), a decision concerning the former section 137 Land Transfer Act 1952, a caveat was lodged by Mark Hector Norrie, as beneficiary of the Norrie Family Trust, against a title of which the registered proprietors were Ian David Maxwell Norrie, Cindy Sue Norrie and M&H Trustee Services Ltd.

LINZ accepted the caveat, but the registered proprietors took the view that it failed to comply with sub-sections 137(2)(b) and (c) Land Transfer Act 1952.

Justice Ellen France acknowledged that what constitutes sufficient certainty will vary with circumstances and that on receipt of a caveat, the Registrar-General of Land (RGL) is not exercising an adjudicative function, but performing an administrative act.

She also observed that a registered proprietor can make an application for removal of a caveat under section 143 and seek damages from the caveator, under section 146.

The Judge decided that:

  • the RGL must be satisfied that requirements as to form are met, as they provide a threshold.
  • Although it was the bare minimum, the description in this case equated with that in In re Peychers' Caveat, in terms of the description of the nature of the interest, and with the form in the 'Land Titles' precedents book.
  • However, it was necessary to explain how the interest derived from the registered proprietor. In some cases this factor may be obvious from the title, but that was not so here. M & H Trustee Services was not clearly linked to the Norrie Family Trust;

Accordingly, the judge considered the plaintiff was correct in that the requirements of section 137(2)(c) were not met.

For practitioners, the decision confirms that caveat forms must contain all information which was formerly required by section 137 Land Transfer Act 1952 and now required by section 138 Land Transfer Act 2017. In particular, practitioners must ensure that the derivation of the interest claimed from the registered owner to the caveator is explicit.

Non-compliance with the requirements of section 138 is not a minor error or defect in form which LINZ can overlook. 

Though the RGL is not required to verify a caveator's entitlement to any estate or interest claimed (section 147 Land Transfer Act 2017), LINZ will reject caveats which fail to satisfy these requirements.

A useful guide, originally derived from Land Titles New Zealand /Forms and Practice: Precedent 48 (p302/221) is:

The above named caveator claims a beneficial interest in the land contained in the above [record of title] as cestui que trust of which the registered owner,[name] is trustee.

Last Updated: 3 December 2018