A Complicated mess, with Land and a Caveat

Hi, heres my current situation that I'm after some advise for.

Last year I signed a 3 way Joint venture agreement that was for buying some land, subdiving and selling.

The other 2 parties had bad credit so the loan for the land was put in my companies name.

The land was purchased in my Trust, with my company as trustee.

The subdivision is almost done, but selling the land as house and land packages has not been at all successful due to the small frontage houses we went with.. They are 6 m wide blocks (3 of them) and 55 metres long. People can't seem to see the houses as being spaciaous enough.... but thats another story.

The problem I have is that for the purchase of the land, the other 2 parties came up with $150k. The land price was $440k.
I paid the 10k deposit on the contract. Over the coming months the with the 20% deposit on the land + fees, sub division costs and loan repayments the $150k is now gone and I am left to pay the loan repayments with one of the other joint venture partners..

The 3rd partner is now a broke alcoholic and I've now found out he got that $150k off of a woman he was seeing (but is no longer). This woman has since put a caveat on my land for $150k which is fair enough, but now as the land is not selling and I can't get the finance to build the houses I need to get rid of it..
There is a loan for $352k in my name and then the caveat for $150k.. I think that I would only get 400 to $450k for the land. This leaves the woman with the caveat very short so I'm sure they would block any sale..

I need to get rid of the land as I can't afford the repayments. I've had the 3rd party who doesn't pay for anything sign an agrement saying that if he doesn't make equal repayments with the rest of us that the original joint venture agreement can be terminated.

Can I challenge this woman's caveat? I guess the only link to me is the trasfer from her account to mine before the property was bought... I don't want to rip her off, I just need to sell the property and can give her whats left after the bank takes its share, but its not going to be 150k. She should be suing the broke alco...

Worse still is I've heard that the woman has bi polar and her parents now have power of atterney...

Should i challenge this caveat in court? or try and get in contact with them and explain the situation.../??.. How do I protect myself....... what should I do.?? :confused:

Please help, any ideas or info would be much appreciated.

thanks
 
Have you consulted a solicitor? If not, why not?

As I see it there is no connection to you and this property except for the joint venture agreement as such seeing that the Alco... is not on the tittle I can't see how they were able to place the caveat. Is there something in the JV that allowed this to happen?

More questions than answers.

Cheers
 
you seem to be protected enough, well as much as you could! annyways?
my first call is to be able to talk to the other invester, write down the original investment straturgy, and explain the full issues to her, the cavete is most likly beetween her and her drunk X, as she would be not so happy with him at the moment, she might want to see the project through, to the end,

Gee! what a pickle your in!
What i have learned on this amazing jeorney, do not do buissiness with any one that is not already successfull in their own world, those that have little to offer, do not know those basic investment/wealth creation rules. they do not read , or invest time to educate themselves, in wealth creation straturgies, they are usually in lots of bad debt, and can't wait to grab shares of money, to spend on new cars, furniture, and cheap, resteraunts, they are frivilous with money, there fore people like you come along, and , perhaps try to help but it rearly does, and turns to **** when the chips are down,
Sorry about your situation, and keep all comunication doors open;)
 
Bad situation your in.

Unless there is something in the JV agreement I can't see how she can lodge a caveat on the property that is owned soley by your trust with your company as trustee.

Some good legal advice at this point would be prudent to your ability to continue.

If in the JV the other parties have caveatable interest in the event something goes bad then I would contact the other party and sit down with her explain the situation and see if she is willing to enter the process in exchange for the drunk guy being removed....... if she has 150k to lend she may be able to help fund the build and eventual sale.

Start with your solicitor and see what her right is to loadge the caveat then look at the best move for your best outcome after that.

if I can suggest looking at a win/win may mean some financial loss to you. But karma is a ***** if you mess with her.
 
Can I challenge this woman's caveat? ............. Should i challenge this caveat in court? or try and get in contact with them and explain the situation.../??.. How do I protect myself....... what should I do

It was wise of the bi polar woman to slap a caveat on the property to protect her interests.

She must have had legal advice to protecting her $150k interest, as this course of action seems appropriate.

Not sure how she has claim to the property through your investor drunkard broke partner. Perhaps he assigned some rights over to her as part of the loan.

You need a legal interpretation of the facts from an appropriate competent property solicitor before you can evaluate a negotiation strategy. It is essential that you determine where you stand based on facts (not opinion) to determine your options.

You need a workable solution that both parties can agree on. If you know where you stand in terms of the law, then you can start looking at how to best meet both parties’ interests. Get onto that competent property lawyer.

Partnerships often look good until they are up against the wall. How well they function under pressure is the key test of a good partnership. Alcohol & substance abuse under pressure is seldom a recipe for success within a functional partnership. This is a hard lesson about knowing all the facts & choosing your partners well before forming the partnership.

Keep focused on what you have got & get onto that competent property lawyer. Once you know the facts & legal options from an appropriately qualified legal expert, then you will be in the best position to work out a deal.

Philip
 
Have you consulted a solicitor? If not, why not?

As I see it there is no connection to you and this property except for the joint venture agreement as such seeing that the Alco... is not on the tittle I can't see how they were able to place the caveat. Is there something in the JV that allowed this to happen?

More questions than answers.

Cheers

No I haven't seen a solicitor yet, but I will be very soon.

The joint venture mentions that the partners can take out a caveat on the land, but the person who has taken out the caveat is not involved in the joint venture agreement at all and has no written agreement with anyone in the joint venture....
 
you seem to be protected enough, well as much as you could! annyways?
my first call is to be able to talk to the other invester, write down the original investment straturgy, and explain the full issues to her, the cavete is most likly beetween her and her drunk X, as she would be not so happy with him at the moment, she might want to see the project through, to the end,

Yes I'd like to talk to the Drunks X but she has changed her number since the drunk x was harrassing her.. I'm trying to get her parents number off of the drunk, but hes not currently answering his phone because he knows I'm after money from him..
 
Bad situation your in.

Unless there is something in the JV agreement I can't see how she can lodge a caveat on the property that is owned soley by your trust with your company as trustee.

Some good legal advice at this point would be prudent to your ability to continue.

If in the JV the other parties have caveatable interest in the event something goes bad then I would contact the other party and sit down with her explain the situation and see if she is willing to enter the process in exchange for the drunk guy being removed....... if she has 150k to lend she may be able to help fund the build and eventual sale.

Start with your solicitor and see what her right is to loadge the caveat then look at the best move for your best outcome after that.

if I can suggest looking at a win/win may mean some financial loss to you. But karma is a ***** if you mess with her.

I'm pretty sure now that the woman involved parents look after her finances that theres no chance of them funding the build. I would love to be able to talk to these people, its just hard that I've never met them and they have private numbers that I can't get...... Might have to right a letter via the solicitor who did the caveat for her..

I don't want to screw anyone over, and will do everything I can to get an amicable outcome fro all parties...
thanks
 
It was wise of the bi polar woman to slap a caveat on the property to protect her interests.

She must have had legal advice to protecting her $150k interest, as this course of action seems appropriate.

Not sure how she has claim to the property through your investor drunkard broke partner. Perhaps he assigned some rights over to her as part of the loan.

You need a legal interpretation of the facts from an appropriate competent property solicitor before you can evaluate a negotiation strategy. It is essential that you determine where you stand based on facts (not opinion) to determine your options.

You need a workable solution that both parties can agree on. If you know where you stand in terms of the law, then you can start looking at how to best meet both parties’ interests. Get onto that competent property lawyer.

Partnerships often look good until they are up against the wall. How well they function under pressure is the key test of a good partnership. Alcohol & substance abuse under pressure is seldom a recipe for success within a functional partnership. This is a hard lesson about knowing all the facts & choosing your partners well before forming the partnership.

Keep focused on what you have got & get onto that competent property lawyer. Once you know the facts & legal options from an appropriately qualified legal expert, then you will be in the best position to work out a deal.

Philip

Thanks for some good advise, must find a property lawyer in SA... Anyone know a good one?
 
If someone puts a caveat on your property without reason and it interferes with a sale causing you loss then you are entitled to sue them for damages.

I cannot see how this woman has a caveatable interest in the land, she lent the money to the drunkard and she is not involved in the joint venture.

Even if someone owes you money you can't lodge a caveat on their land/property as you have no interest in it. You can lodge a writ which gives you the right to sell it but that is different matter and would need a court judgement. This is the law as I understand it in Queensland, it is probably different down there.
 
If the woman was in a relationship with the man as it seems from previous posts, then she has an interest in his assets, including his share in this venture.

However, legal advice should clear this up and, if appropriate, organise the removal of the caveat.
Marg
 
I cannot see how this woman has a caveatable interest in the land, she lent the money to the drunkard and she is not involved in the joint venture.QUOTE]

On face value it looks like the woman could well have an interest in the land as she put $150k capital via drunkard boyfriend. Fortunate for her she protected her interest with a caveat.

I wonder if she has any other claims in this deal through her drunkard X???

Philip
 
Without any documentation I cannot see how this woman can be any more than an unsecured creditor to the drunkard. In the absence of some paperwork to show she is a joint venture partner, mortgagee or specifically lent the money for the purchase of this piece of land and has an agreement to lodge a caveat, she is in a precarious position.

Since the land was purchased in your trust and the only link to you is the transfer from her account to your personal account (I presume) before the property was bought I believe she has no right to place a caveat on the land.

If you do sell the land I would make sure that any of the proceeds were not handed over unless you have a written agreement with the drunkard and the woman otherwise you might be in the middle of an even worse situation with both claiming $150k from you.

I would definitely go and see a lawyer. Let us know what they say. This sounds like it might become interesting.
 
what an awful mess.
tell me was this your first go at this type of venture?
your 2 partners seem a strange choice for a business arrangement.
nevertheless if they lent/gave money to you for this project, which you presented as being worthwhile, i would imagine they would expect some return.
the woman was no doubt vulnerable if she is as you describe, and her family are wise to do what they have done, albeit perhaps too late to protect her.
i am surprised the council approved the plans, is does look like a lot on the block?
what do you intend to do?
did you mention what you paid for the land? did the $150000 given all go towards the subdividing and plans etc?
sounds expensive. whats left just the bare land and the plans?
i wonder what the legal advice will be? it sounds an expensive mess. not surprised your other partner has turned to booze.
no doubt a learning op for all. good luck.
 
As far as I am aware, the registrar is not required to determine the validity of the caveator's claim so she may well have placed a caveat on the property.

Let's see what happens.
 
philip just out of interest, if someone buys a property with a caveat on the title, at the point of transfer once the purchase price has been paid, is the title then transferred to the purchasers name and the caveat removed?
or is the buyer also encumbered?
i would expect not. the person or body that has put the caveat on the title, are they paid in full before other parties?
just curious how it works.

also if you buy off the plan, eg and hand over the agreed purchase price and later find like in this case, the developer does not have the funds to complete the project. where does that leave the purchaser?
not too good!
but i suppose you do not hand money over until the project is complete.
how can you be sure the developer has paid all parties, eg passed any money the purchaser has paid on to all relevant parties?

heard of a case the other day of a woman who had paid for a home, with borrowings, she wondered how it was progressing, went to have a look and was told by workers near by that the builder had gone bankrupt so the house would not be finished.
regards
 
The words , developing, Joint ventures, property developer, sound so! nice, and important, but gee! remove the cream, and you somtimes have a whole lot of nasty bits all tied together, But, mind you if you get through this one you will be so much the wiser on the next and is gets sooooo, much easier after that!

I am sure that , the powers to be place these hurdles in front of all of us , its a private little test, breaking in would be millionares so to speak, ;)
Take it step by step, and you will get through it ok! Gee! money changes the perception, of how the world works. when you get joint ventures like this one , the needy change to be the greedy! so many storys of how mums and grans, get taken for a ride by familly and freinds, in big money buisiness , TRUST KNOW ONE! (let it be said, let it be written!, ;) )
 
lawyers always win

Have you consulted a solicitor? If not, why not?
Cheers

Because, more often than not, its the lawyers who always win! More often than not, despite their effusive promises and warm smiles, lawyers obtain pathetic and costly outcomes that the ordinary bloke could obtain himself. In the food chain, lawyers are marginally above real estate salesmen.

I can't see why this poor fellow was persuaded to get into such a complex legal web in the first place. The structures created for him would probably benefit his accountant and lawyer more than it would benefit him. Its a bit sad really....
 
philip just out of interest, if someone buys a property with a caveat on the title, at the point of transfer once the purchase price has been paid, is the title then transferred to the purchasers name and the caveat removed?
Not necessarily. Part of the conveyancing process is checking if there are any impediments to clear title.

I have heard of a famous case - lawyers could probably tell us which one it was - in which a couple bought a (quite expensive from memory) property, and it had clear title when the conveyancer/solicitor checked on the day before settlement, but a creditor of the vendor managed to slap on a caveat on settlement day, a few hours before settlement.

I think the poor buyers ended up having to pay out the vendor's debtor. :(

Buying property is risky and fraught with potential for disaster, particularly if you rely on "standard contracts" to protect you. If you are smart, and hire a smart solicitor (instead of the cheapest conveyancer you can find), you get clauses put in which can protect you against the most well-known potential disasters lurking in that "standard contract".
 
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