Contract review and title risk, linked to the matter.
Matter Desk helps property and conveyancing lawyers analyse contracts of sale, identify title risks, calculate limitation periods, and generate IRAC memos. All inside the matter workspace.
Sample research output
Question
Our client is a purchaser. The vendor's solicitor has disclosed a caveat from a third party on the title. The contract is subject to a 42-day settlement in NSW. What is the vendor's obligation to remove the caveat before settlement, and what are our client's options if it is not removed in time?
Short Answer
The vendor has an obligation to deliver unencumbered title at settlement unless the contract expressly permits the caveat to remain. A registered caveat that is not withdrawn before settlement entitles the purchaser to rescind the contract or to seek specific performance with compensation. The purchaser's options depend on the terms of the contract and whether the vendor can procure withdrawal before the settlement date.
Relevant Authorities
- Conveyancing Act 1919 (NSW) s 149B, vendor disclosure obligations
- Real Property Act 1900 (NSW) s 74H, caveat lapsing procedure
- Standard form Contract for Sale of Land (Law Society of NSW / REINSW) cl 10, title free from encumbrances
- Roberts v Ede [1961] NSWR 222, vendor's duty to deliver clear title
Reasoning
Under clause 10 of the standard NSW contract, the vendor warrants that title is free from encumbrances other than those disclosed in the contract. A caveat lodged by a third party that is not listed as a permitted encumbrance constitutes a breach of that warranty if not removed by settlement.
The purchaser may: (1) serve a notice to complete after the settlement date passes, preserving the right to rescind if the vendor remains in breach; (2) apply to the Supreme Court for an order that the caveat lapse under Real Property Act s 74H if the caveator does not commence proceedings to substantiate the claim; or (3) rescind and recover the deposit if the vendor cannot deliver clear title.
Caveats
The availability of rescission depends on whether time is of the essence under the contract and whether the purchaser has issued a valid notice to complete. The specific terms of the caveat and the caveator's underlying interest should be reviewed before advising the client.
Human review required before client-facing use.
What Matter Desk does for property and conveyancing.
Contract of sale review: parties, special conditions, settlement dates, and risk flags.
Title search analysis with caveat, mortgage, covenant, and easement issues identified.
Limitation period calculation for property claims across NSW, VIC, QLD, and Federal.
Disclosure obligation checklist for vendors and purchasers under state legislation.
IRAC memos linking property authorities to matter-specific title and contract facts.