Chong v Chanell (No 2)

The case of Chong v Chanell (No 2) involved a dispute over the removal of a caveat from Torrens title land in New South Wales. The plaintiff sought an order under section 74MA of the Real Property Act 1900 for the removal of the caveat lodged by the defendant. The dispute centred on whether the defendant had a seriously arguable claim to a caveatable interest that would justify the retention of the caveat. The case was heard by the Supreme Court of New South Wales.

The central legal issue before the court was whether the defendant, as the caveator, had established a seriously arguable claim to a caveatable interest. The court had to determine whether the balance of convenience favoured the retention of the caveat. Additionally, the court needed to assess whether the defendant’s claim was one that would entitle the caveator to an injunction prohibiting the proposed dealing, and if so, whether the plaintiff’s charge would prevail over the defendant’s claim.

The court held that while the defendant had established a seriously arguable claim for a caveatable interest, it was not one that would prevail over the plaintiff’s charge. The court found that the balance of convenience favoured the removal of the caveat, but ordered that a portion of the proceeds from the sale of the property be preserved to satisfy the defendant's claim, insofar as the plaintiff's claim was not clearly entitled to priority. This decision balanced the interests of both parties and provided a practical solution to the dispute.

The final orders of the court directed that the caveat be removed, but with the preservation of a portion of the proceeds from the sale of the property to address the defendant's claim. This outcome ensured that the defendant’s interests were protected to a certain extent, while also allowing the plaintiff to proceed with the sale of the property.