When your property sale is stopped by an unexpected claimant

There is an enormous sense of relief when the sale of your home sails through without a hitch, so it's easy to imagine the frustration and anger of two sets of owners when the process was suddenly upended by unexpected claims.

- Tan Ooi Boon

These invariably involve someone other than the buyer lodging a legal notice known as a caveat to stake a claim on the property.

When this happens, the sale cannot proceed and the owner must file an objection to remove the notice, a step that forces the applicant to go to court to validate the caveat and show that the claim is genuine.

So, there's no sale until the dispute is resolved.

When someone lodges a caveat on your property, you will receive a notice of it from the Singapore Land Authority. But in one of these cases, the owners did not get to read the letter, presumably because the caveat was lodged on their investment property, which was occupied by tenants.

They discovered that their former daughter-in-law had staked a claim on their $1.3 million condominium unit only when they were selling it.

The couple took legal action and the High Court eventually removed the caveat, ruling that the woman, who was divorcing their son, had no legitimate claim on the property.

In the other case, the dispute was taken to court quickly because the owner filed an objection immediately after receiving notice that a caveat had been lodged.

But this caveat was upheld by the court because the applicant was the previous owner of the $4 million property and she claimed that the present owner still owed the balance of more than $600,000 for its purchase.

There are important lessons from these two disputes on what you should know relating to property transactions.

WHEN A FAMILY LOAN SPARKS A PROPERTY DISPUTE

Just because you believe that you have been wronged and that someone owes you money, this does not mean that you have an automatic claim over the other person's property.