21 Million Pty Limited v Clarence Street Pty Limited

The case of 21 Million Pty Limited versus Clarence Street Pty Limited was heard in the Federal Court of Australia. The dispute between the parties centred around the validity of a caveat lodged by 21 Million against a property owned by Clarence Street. The issue was whether 21 Million had a sufficient interest in the property to justify the lodgement of a caveat, given that the caveat was based on an agreement that was itself in dispute.

The court had to determine the legal principles governing the lodgement of caveats, particularly in cases where there is an argument over the existence or validity of an underlying agreement. It was necessary to establish whether 21 Million had a reasonable cause of action, or a bona fide belief in a potential cause of action, which would justify the lodgement of a caveat. The court also had to consider the equitable principles that guide the granting of interlocutory injunctions, such as the balance of convenience and the risk of irreparable loss.

In its judgment, the court held that 21 Million did not have a reasonable cause of action to support the lodgement of a caveat. The court found that the agreement upon which 21 Million relied was not valid, and therefore, 21 Million could not have a bona fide belief in a potential cause of action. Consequently, the caveat was invalid, and an interlocutory injunction was appropriate to prevent 21 Million from continuing to rely on the invalid caveat. The court granted the injunction, ordering 21 Million to remove the caveat from the property records. The decision underscored the importance of a genuine belief in a cause of action for the lodgement of caveats, and the need to balance the rights of property owners against the potential for unjust enrichment.