KPE Superannuation Fund Pty Ltd v QRM Holdings Pty Ltd

KPE Superannuation Fund Pty Ltd (KPE) appealed to the Court of Appeal of New South Wales against an order made by the Equity Division prior to a final hearing, which had directed the removal of a caveat. The dispute concerned the balance of convenience in relation to the removal of the caveat lodged by KPE.

The Court of Appeal was required to determine whether the Equity Division had erred in its exercise of discretion by ordering the removal of the caveat. Specifically, the court had to consider the application of section 74MA of the *Real Property Act 1900* (NSW), which governs the removal of caveats, and assess whether the balance of convenience favoured the removal of the caveat at that interlocutory stage.

The Court of Appeal found that the primary judge had misapplied the principles relevant to the balance of convenience in the context of a caveat removal application. The court reasoned that the purpose of a caveat is to protect a caveator's asserted interest in land, and its removal should not be ordered unless the caveator's claim is demonstrably without merit or the balance of convenience clearly favours removal. The Court of Appeal concluded that the Equity Division had not given sufficient weight to KPE's asserted interest and the potential prejudice it would suffer if the caveat were removed prematurely.

Consequently, the Court of Appeal granted leave to appeal, allowed the appeal, and set aside the orders of the Equity Division. In their place, the Court of Appeal ordered that Mr Quinn's notice of motion for the removal of the caveat be dismissed, with the costs of that motion to be KPE's costs in the cause. Mr Quinn was also ordered to pay KPE's costs of the appeal proceedings.