Swanton’s case doubted

In Stone v Leonardis [2011] SASC 153 the Supreme Court of South Australia held at [36] that in principle a registered proprietor could lodge a caveat on title to protect its own interests.

In Stone the registered proprietor lodged a caveat preventing a mortgagee of the land settling on a contract of sale. The registered proprietor's allegation was the mortgagee had improperly exercised the power of sale by entering into a contract for less than the market value.

It has been held in Victoria that in such circumstances a mortgagor did not have an equitable interest but had a mere equity to set the sale aside. See: Swanton Mortgage Pty Ltd v Trepan Investments Pty Ltd [1994] 1 VR 672 andVasiliou v Westpac Banking Corporation (2008) 19 VR 229. White J held that Swanton was "clearly wrong" and that the court would not follow it. However, in the circumstances of the case His Honour decied that the caveat should be removed.