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What is a Caveat? And Why You Need One!

In anticipation of the launch of our new fixed fee package “Nip It In the Bud – a simple fixed fee package helping you resolve disputes quickly and cost efficiently”. This post will cover one of the key features of the package: caveats. Outlining what a caveat is and the reason you might need one!

What is a caveat?

A caveat is a legal document that is lodged at court by a person or a company. Once caveat is in place, it obliges the court to tell that person or company if someone is seeking an immediate order against them.

It essentially acts as an early warning system flagging up if someone is trying to get an interim order against you without you knowing it!

What types of things does a caveat warn you of?

There are a number of things that a caveat will warn you of, the most common being:

  • Interim Interdict- this is an order that could prevent you from doing something e.g. selling a piece of property, entering a certain place, publishing certain information, etc.
  • Implement or Delivery – this is an order that could force you to legally do something, g., carry out a specific part of a contract you have signed up to.
  • Payment on the Dependence of an Action – if you are a debtor this is an order by which someone can make you pay the debt at the outset of any court proceedings on the basis that they think you are disposing or hiding assets.
  • The appointment of liquidators or the winding up of your company- this is an order to appoint a liquidator to your company or to have it wound up.

Why do I need a caveat?

If you do not have a caveat in place, the first thing you might know about any action may be when it is served on you advising you that the interim order has already been granted in your absence.

While you would thereafter have an automatic hearing where you could ask the Court to remove the interim order, such a hearing is usually appointed to take place two weeks after granting of the interim order. You would, therefore, be bound by the interim order for at least two weeks.

Considering some of the effects of the above interim orders, this could prove to be extremely damaging to you, or your business.

If you think you or your business are going to be subject to any sort of litigation, then it is strongly advised that you make sure that you have caveats in place. Even if litigation is unlikely any business with a link to Scotland should consider putting caveats in place to protect themselves from an interim order being passed without their knowledge.

How long does a caveat last for?

Once a caveat is lodged it last for one year. It can be renewed thereafter on a yearly basis.

How do I get a caveat? Contact our Dispute Resolution Solicitors Today

A caveat is a formal legal document. It is your solicitor who is notified if it is triggered.

If you are interested in putting caveats in place or would like some more information, phone our dispute resolution team on 0131 226 8200 or contact us via our online contact form.

Alternatively, you can sign up to our new “Nip it in the bud” dispute resolution package which as well as providing caveats includes a range features that allows you to resolve disputes quickly and cost efficiently. Details of the package can be found here.

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