Cautions and Inhibitions

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1. Cautions on Registered Land

1.1 General
A caution is a restriction on disposition by the registered owner without notice to a person who claims “any right in, to or over registered land or a registered charge” (section 97 (1)).

Section 3 (1) of the Registration of Title Act, 1964, defines “right” as including “any estate, interest, equity or power” over lands.

A caution entitles a cautioner to notice of dealings by the registered owner only and not in respect of dealings other than by the registered owner e.g. a judgment mortgage, etc.

A caution against registered land is entered in red on Part 2 of the Folio. A caution against a registered charge is entered on Part 3 of the Folio.

Examples of rights which may be protected by caution:

1. The right of a purchaser of lands under a contract for sale. (The caution can only be registered to affect the part of the property the subject of the contract).
2. The right of mortgagee under an agreement to give a charge on lands.
3. A right under any unregistered instrument or facts as would disclose an interest in the lands or a particular registered charge on the lands
4. The right of next-of-kin on intestacy or persons entitled under the will of a deceased owner to an interest in lands.
5. An option to purchase.
6. The right of a person who claims he has provided all or part of purchase money for the lands.

Cautions are not to be given

(a) in respect of rights which are immediately capable of registration as burdens under section 69 of the Registration of Title Act, 1964, or

(b) in respect of rights which affect without registration under section 72 of the Registration of Title Act, 1964.

However, a caution can be used as a temporary protection of an unregistered right equity pending its conversion into a registered interest or pending litigation, actual or contemplated. For example, the correct registration in respect of a section 69 burden is normally the registration of the burden. But, if the consent of the registered owner to such registration has not been given, the owner of the right in question could apply for a caution pending litigation to force the registered owner to give his consent.

If the right of the cautioner relates to a specific identifiable part of the property, such part should be identified in accordance with Rule 56 and the caution will be limited to affect such part only. If any difficulty arises in the mapping of a caution the dealing should not be put into Mapping Branch’s Query Shelf. but should be brought immediately to the H.E.O. of the Section.

A H.E.O. or higher officer should be consulted before settling any application for registration of a caution. On entry of a caution, notice is served on the registered owner (Rule 122(4)).

1.2 Evidence to support Caution
The evidence necessary to support a caution is not as stringent as the evidence necessary to support an inhibition.

The cautioner must show by affidavit that he has prima facie a right enforceable against the registered owner, i.e. he must aver that he has such a right as would be suitably protected by a caution. The documents, e.g. contracts on which the right is grounded should not be called for.

A person lodging a caution without reasonable cause is responsible to make compensation to any person damaged thereby (section 97 (5)), whereas in the case of the registration of an inhibition, the Registrar takes responsibility for making the entry.

1.3 Dealings affected by Cautions and applications to discharge Cautions
Whenever

(a) an application for discharge of the caution is made by the registered owner, or

(b) a dealing by the registered owner is lodged, a warning notice is sent to the Cautioner in LR Form 73 or LR Form 74 and the Cautioner must then reply and take whatever action is considered necessary to establish such right. (See Rule 125(2)).

If the cautioner does not reply to the warning, the caution will lapse and registration of the dealing should proceed and the caution should be cancelled. (Rule 127). The cancellation of a caution which has lapsed should be settled by a H.E.O.

If the cautioner replies to the warning requesting the continuance of the caution or objecting to the registration of the...