(b) the further caveat is endorsed with the consent of the primary applicant or possessory applicant for, or the registered proprietor of, the estate or interest affected by the further caveat."
48 In the present case, neither of the conditions precedent to validity specified in s.74O(2) had been fulfilled in respect of the caveat which ACE sought to lodge on 23 October. Even though the document was accepted over the counter at the LPI, noted by an examiner and forwarded to the Legal Department for assessment as a matter of routine office procedure, the document was, in law, a nullity. The mere fact that a reference number was given to the document and that that reference number appeared under the heading "Notations. Unregistered dealings" on a search of the title could not give the document any legal efficacy contrary to the clear terms of s.74O(2)
49 Mr McKenzie has not sought to argue that the document filed in the LPI by ACE on 23 October was effective in law despite s.74O(2). Rather, he submits that the word "caveats" in Special Condition 30(c) is not limited to caveats effective in law but extends also to anything purporting to be a caveat which would have the effect of preventing registration on 23 October of a transfer pursuant to the contract, or preventing completion of the contract on that day as a matter of commercial reality. Mr McKenzie submits that the contract should be construed as a commercial agreement because the parties to it were commercial parties and that, accordingly, regard must be had to the commercial result of the document which ACE filed on 23 October.
50 Mr McKenzie relies upon the evidence of the LPI officer, Mr Fitzgerald, which was to the effect that even though it was quite clear from the face of the caveat lodged by ACE on 23 October that the interest claimed was the same as had been claimed in the lapsed caveat which had been lodged by ACE on 2 August so that the 23 October caveat was of no effect under s.74O(2), office procedure required that the caveat form be sent to the Legal Department, and the Legal Department would send a standard form letter to the caveator giving the caveator fourteen days to show cause why the caveat should not be treated as a nullity. Mr McKenzie says that the LPI's procedure, in reality, produced the result that a transfer from the Defendant to the Plaintiff lodged on 23 October would not have been registered on that day.
51 Further, Mr McKenzie says, a purchaser in the position of the Plaintiff, dependent on finance to complete the purchase, could not complete the contract on 23 October because a search of the title on that day revealed the "unregistered caveat" and no financier/mortgagee would have settled in those circumstances.
52 I am unable to accept Mr McKenzie's submission as to the construction of "caveats" in Special Condition 30(c). The word "caveat" is a term of art with a well understood meaning, whether used in a contract for sale of land or in any other commercial agreement. Section 74F RPA prescribes the circumstances in which a caveat may be lodged, what the caveat form must contain and what the Registrar General must do when a caveat is lodged. Section 74H RPA prescribes the effect of a caveat while it is in force. In my opinion, when Special Condition 30(c) uses the word "caveat" it uses that word in its commonly understood meaning as a document filed in accordance with s.74F and having the effect provided in s.74H.
53 If the parties to the subject contract had intended to provide an "escape route" under Special Condition 30(c) if anything at all could have prevented immediate registration of the transfer on 23 October or could have inhibited completion on that day, it would have been easy enough to make that intention expressly clear. I am unable to read "caveat" in Special Condition 30(c) as having any wider meaning than its ordinarily understood meaning.
54 The fact that a transfer presented for registration on 23 October might, and I emphasise might, not have been registered until the LPI's office procedures had been complied with is, in my view, of no consequence. A transfer lodged for registration on 23 October would have been entitled in law to registration on that day because the document filed by ACE, being a nullity under s.74O(2) could not legally have been an impediment to its registration. I do not think that Special Condition 30(c) is concerned with the mechanics and office procedures of registration within the LPI, nor is it concerned with the consequences on arrangements for settlement of a notation on a search which reveals what is an "unregistered dealing". The Special Condition is concerned with legal impediments to completion of the contract and legal impediments to the registration of the transfer on 23 October.
55 In my view, the meaning of Special Condition 30(c) is that if there has been any caveat lodged against the title to the subject land after exchange of contracts which is effective under s.74H RPA and which has not been removed, either by lapsing, withdrawal or order of the Court, by 23 October then either party is entitled to give notice of rescission. Caveats effective in this sense had been lodged after exchange of contracts but, by 23 October, all had lapsed and no effective caveat remained against the title on that day. It follows, in my opinion, that the Defendant was not entitled to give a notice of rescission under Special Condition 30(c) on 24 October.
56 Mr McKenzie submits that Special Condition 30(c), on its proper construction, gives a right of rescission if a caveat is lodged after 23 October but before completion; he relies on the form of caveat filed by ACE on or about 26 November but uplifted on 27 November without it having been registered. I cannot see how the filing of this caveat assists the Defendant. First, it was not a "caveat" within the meaning of that word in Special Condition 30(c): it was a nullity by virtue of s.74O(2) RPA. Second, it had not been filed as at 23 October, which is the date upon which a state of affairs giving rise to a right of rescission must exist.