Between signing and settlement the buyer holds an equitable interest in the land. Lodging a caveat under the Transfer of Land Act 1958 records that interest on the title and prevents competing dealings being registered ahead of the buyer while the caveat stands.
A priority notice is a lighter alternative. It reserves priority for a dealing about to be lodged, lapses after a set period and can be renewed once for a further period, which suits the short run into settlement.
Whether to caveat is a judgment that weighs the small cost against the protection, and it is more commonly used on longer settlements or where the vendor's circumstances raise concern. A caveat without a genuine caveatable interest can give rise to a claim for compensation.
CMK Legal's property and conveyancing team can act on matters like this.
A caveat lodged without a proper interest exposes the lodging party to a compensation claim. A priority notice has a limited life and a single renewal, so timing matters.
Law referenced: Transfer of Land Act 1958 (caveats and priority notices). Section C. Vendor disclosure, the section 32 statement