Forder v Cemcorp Pty Ltd

The case before the court involved the plaintiffs, Forder, who held an option to purchase a lot within an unregistered strata plan. The defendant, Cemcorp, was the owner of the site and had subsequently sold the property to a third party. The plaintiffs sought to assert a caveatable interest over the property based on their option to purchase. The dispute was heard in the Supreme Court of Victoria. The plaintiffs argued that the option they held constituted a caveatable interest, entitling them to lodge a caveat against the transfer of the property to the third party. The defendant contended that the option did not create a caveatable interest as it was not registered under the relevant strata legislation.

The primary legal issue before the court was whether the option held by the plaintiffs created a caveatable interest in the property. This required the court to examine the nature of the option and its effect under the law governing strata titles. The court needed to determine if the option was a registrable interest under the Strata Titles Act, and if it failed to be registered, whether it nonetheless provided the plaintiffs with a sufficient interest to warrant the lodging of a caveat. The court was also tasked with considering whether the equitable doctrine of part performance or other equitable principles could be invoked to support the plaintiffs' claim.

The court found that the option to purchase did not constitute a registrable interest under the Strata Titles Act. Consequently, the plaintiffs' interest was not caveatable in the strict legal sense. However, the court examined whether equitable principles could provide a basis for the plaintiffs' claim. It concluded that while the option did not create a registrable interest, the equitable doctrine of part performance applied, giving the plaintiffs an equitable interest in the property. This equitable interest was sufficient to warrant the lodging of a caveat. The court ultimately determined that the plaintiffs had a caveatable interest based on their equitable rights, despite the option not being a registrable interest.

The court ordered that the plaintiffs' caveat be upheld, recognising their equitable interest in the property. The third party purchaser was bound by the caveat and could not proceed with the sale until the equitable interest was resolved. This decision underscores the importance of equitable principles in strata title disputes and the potential for equitable interests to provide a basis for caveats, even in the absence of a registrable interest.