This is an often asked question. Typically, someone will have bought a property at auction in their own name, or from an off-the-plan development and then decide they want to buy the property in the name of their spouse or some other entity like their super fund.
The decision to change names often happens after they have discussed the purchase with their accountant and/or solicitor and things like asset planning and estate planning are raised.
Most people seem to think they can simply change the “purchaser” on the contract by inserting the words “or nominee”.
That process in most cases will not work and will result in you paying double Stamp Duty.
In NSW, the name on the Contract needs to be the same name on the Transfer document. On a $1,000,000.00 purchase price, the Stamp Duty payable by the purchaser is $40,490.00.
If the purchaser on the Transfer is different to the person on the Contract, then the Transfer will be treated as a sub-sale, resulting in a second or additional Stamp Duty amount of $40,940.00 being payable on the Transfer document.
There is an exception; for some limited circumstances contained in Section 18(3) of the Duties Act. This Section allows the ultimate purchaser to be a different person from the purchaser in the Contract, so long as they are related persons.
A related person includes a spouse, parent and child. It can also be a private company where the person is a director or majority shareholder of that company. It can also be a Trust where the natural person is a beneficiary of the trust.
The crucial point when applying S18(3) and which is often missed, is that the ultimate purchaser must have been “related” when the Contract was entered into. So you cannot form a company or trust after the date of the initial Contract.
If the “related person” exemption is not available, then your only real alternative is to attempt to persuade the vendor of the property to rescind the original Contract by mutual agreement and enter into a new Contract.
Sometimes this is possible; however, invariably you end up paying yours and the sellers the legal costs of the rescission of the initial Contract and the new Contract. Sometimes the vendor simply does not want to be involved in such a process
The best option in all cases is to seek appropriate advice as to the purchasing entity and buy it in the correct name from the very beginning.
Our property team at Everingham Solomons can assist you with all your property related matters because Helping You is Our Business.
A Contract for the sale and purchase of property includes conditions stating that the purchaser accepts the property in its current condition and state of repair subject to all defects both obvious and hidden. You might have heard the saying “let the buyer beware”.
As a result, purchasers have an extremely limited right to complain after exchange of Contracts regarding the quality of the improvements and inclusions. Improvements include the structures on the property, for instance the house, shed, etc. Inclusions are usually movable items included in the sale, for instance the blinds, stove, air conditioner, etc. Purchasers should undertake thorough inspections of the property and the inclusions prior to exchange of Contracts, which is when the parties are formally bound by the Contract terms. The inspection process can be split into two stages.
Stage One – Purchaser Inspections
It is recommended that purchasers undertake a minimum of two physical inspections of the property. Often, in the excitement of first seeing the property, purchasers may overlook matters. Purchasers can obtain a copy of the Contract from the real estate agent to take to the inspection as all residential properties listed for sale in NSW are required to have a marketing Contract. Purchasers should review the improvements and inclusions noted on the Contract to establish whether they are accurately listed. A review of the title search is important to ascertain whether there are any easements or rights of carriageway affecting the property. For instance, if access to the property is obtained via another’s property, the title search should recite a right of carriageway.
Purchasers should review any plans attached to the Contract. Whilst the deposited plan will not reveal the location of the improvements on the land, it does show the boundaries of the property and may assist in identifying any possible encroachments. The plan of sewer line will indicate where the sewer main runs and may also show connections into the property. This can alert purchasers to potential issues regarding structures over sewer mains, or unapproved works if, for instance, connections to a further bathroom aren’t shown on the plan.
Stage Two – Professional Inspections
There are various professional inspections which can be obtained. Most purchasers will initially obtain a pest (white ant) report and building inspection report. A purchaser may also wish to obtain an electrical inspection, Survey Report, Building Information Certificate and/or inspect Council records. If the home has loose fill insulation, you will certainly want an asbestos test. For purchasers obtaining finance, it may be a condition of the finance approval that certain inspections are undertaken.
It is ultimately at the purchaser’s discretion as to which pre-purchase inspections are undertaken. Depending upon the individual purchaser’s appetite for risk and the property, inspections obtained will vary. At Everingham Solomons, we discuss the inspection options available to permit purchasers to make informed decisions because Helping You is Our Business.
Click here for more information on Jessica Wadwell
Are you an Employer? If so, are you aware of each of your employee’s termination notice period entitlements are?
Many employers do not take the time to understand their employment contracts and the effects of the National Employment Standards (NES). This can lead to harsh financial implications when terminating employees or, for example, selling your business, due to the requirement to provide the minimum period of notice or payment in lieu of notice.
If the notice period in the employment contract is greater than the minimum provisions under the NES, then the employment contract will apply. However, if the notice period in the employment contract is less than in the NES, the NES will prevail.
If your employment contract does not provide for a notice period, then the notice of termination provisions in the applicable modern award will apply. If your employees do not operate under an award and have no employment contract, then “reasonable notice” will apply.
What is “reasonable notice”?
The purpose of providing a period of notice is to enable an employee to obtain new employment of a similar nature. Despite the minimum periods of notice of termination set out in the NES or your employment contract, a greater period of notice may be required for an employee if the circumstances of their employment requires it, for example, senior executive employees.
The relevant factors taken into consideration for reasonable notice are length of service, seniority and status of the position, the level of remuneration, experience and expertise, whether the employee was approached by the employer to join the organisation and the prospects for the employee to find alternative employment.
If you are an employer and are unaware of what your notice period obligations are under your employment contracts and the National Employment Standards, please contact Everingham Solomons for advice because Helping You is Our Business.
Everingham Solomons is proud to announce the successful bursar for 2018 is Claire Annis-Brown. Claire is an extremely well rounded student of McCarthy Catholic College having achieved excellent academic results in a range of subjects through her HSC. She is both liked and admired by her teachers and peers alike.
Claire is an accomplished sportswoman, particularly in Hockey where she has captained Tamworth representative teams for a number of years. She has also been involved in a range of local charitable endeavours over a long period of time.
Claire is enrolled to study law at the University of Newcastle in 2019 and Everingham Solomons wishes Claire the very best in that endeavour.
As the successful bursar, Claire has received a monetary award to assist with her study and the invitation for clerkship at Everingham Solomons during University breaks.
Claire’s school, McCarthy Catholic College, has also received a donation from the firm.
Everingham Solomons is committed to the growth of the region and the success of its youth and has for many years offered a bursary to Year 12 students wishing to pursue university qualifications in law.
The bursary was named in honour of one of the firm’s founders, Sir Adrian Solomons. Sir Adrian completed his secondary education at Tamworth High School before commencing university studies in law in 1940 at the University of New England and later at Sydney University. Sir Adrian returned to Tamworth after his admission as a legal practitioner in 1949 to become a respected solicitor and founding partner of Everingham Solomons.
Sir Adrian was knighted by Her Majesty Queen Elizabeth II at Buckingham Palace in 1982 for services to law and government having for many years been a member of the NSW Parliament and remained a consultant to the firm until 1989.
If you would like more information on the Law Bursary, please contact Everingham Solomons because, Helping You is Our Business.
Everingham Solomons is proud to be one of the major sponsors and organisers of the Pedal the Peel Cycling Challenge to be held at Moore Creek Tennis Club, Moore Creek Rd, Tamworth on Sunday, 7 April 2019.
The event is unique to Tamworth because it caters for all levels of rider fitness and experience.
You can choose from a flat 15 km or 25 km course or the more challenging 45 km or 100 km hilly courses.
The event is designed to encourage all levels of riders (minimum age 12 years) to become involved, have a great fun day and help raise money for local charities.
It is unique because we don’t ask you to raise thousands of dollars sponsorship to ride in the Challenge.
You only need to pay your registration fee of $50 per rider. If however you register before 28 February, there is an earlybird fee of $35.
Included in the registration fee is a steak sandwich and drink which will be provided on return to the start/finish location at Moore Creek Tennis Club. There will also be live music at the start/finish site, so you can enjoy some socialising on your return.
It’s unique because it supports lesser known and less well-supported community organisations.
This year the event will support Youth Insearch which is a grass roots, early intervention program which works with at risk youth and focuses on resolving adolescent issues at peer level. This organisation has had tremendous results in assisting at risk youth change their lives.
We all know that mental health has become a huge issue, so we are continuing to support Billabong Club House.
Domestic violence is also a large and sometimes hidden issue in our region and this year we will be supporting Tamworth Family Support Service to help fund a 12 week support group for women, the victim of domestic violence.
We will also be supporting Rotary Lodge which provides emergency accommodation at Tamworth Base Hospital. The lodge is in urgent need of renovation.
You know the event will be well-run and costs kept to an absolute minimum because it is an event organised by the Rotary Clubs of Tamworth First Light and the Rotary Club of Sunrise.
We encourage you to support this valuable community fundraising effort.
You can register online at www.pedalthepeel.org.au
Quite often I come across sellers, testators and mortgagors wherein their names are incomplete or otherwise different from their identification documents (ID) i.e. driver’s licence, passport, birth certificate and marriage certificate (if applicable).
The spelling of your name is critical when preparing any legal documents for example your Will, Power of Attorney, Appointment of Enduring Guardian, sale and purchase of land contracts, mortgages and transferring shares.
These discrepancies can result in delays finalising your property transaction, in some cases breach of contract, issues with selling your shares and can result in increased transaction costs, delay and frustration.
There are many reasons for the inconsistencies, however the most common are:-
Anglicised names (which buyers/sellers/shareholders may commonly go by in day to day life) are not always the same names as reflected on their legal ID documents
Marriage (or breakdown of marriage) where the seller has changed their name since purchasing the property or shares
Missing middle names, which buyer/seller/shareholder may not use all the time, accidently being omitted from the legal documents i.e. Contract for Sale or Purchase of Land/share transfer forms/will/power of attorney etc
Old errors, perhaps from missing or incorrectly spelt names when a seller originally purchased the property or data entry errors made by land registry at the time
Foreign names where there is unfamiliarity. In some cultures, the christian name is written last and the surname is written first for example, Liu Jianguo, in Chinese would be Mr. Jianguo Liu using the Western style.
As we are moving towards a more digital world, it is becoming more important for us to use our full legal name set out in our identity documents, and to ensure our full legal name is used on all documentation in any legal process.
At Everingham Solomons, we have the expertise to assist you because, Helping You is Our Business.
Click here for more information on Suzanne Hindmarsh.
Tougher penalties for drink-driving offences came into effect in NSW aimed at reducing trauma on our roads. The changes are particularly significant for those convicted of first-time mid-range offences i.e. a blood alcohol reading between 0.08 and 0.149 and no convictions of a similar kind or major drink-drive offences in the previous 5 years.
Penalties from 3 December 2018
If you are convicted of a first-time mid-range drink driving offence committed on or after 3 December 2018 the court must now order you to participate in the interlock program for a minimum 12 months and disqualify you from driving for a minimum 6 months. If you wish to drive after the disqualification period has passed you must apply for an Interlock licence which carries with it a zero alcohol limit.
What is an alcohol interlock device and who pays?
An interlock is an electronic breath testing device that is connected to the ignition of a vehicle and prevents it from starting if alcohol is detected. It is also programed to require random breath tests whilst the vehicle is being driven and records all alcohol readings, vehicle starts, engine shut-offs and violations. Data is downloaded from the device monthly and sent to NSW Roads and Maritime Services for review. Interlock devices also have built in cameras to reduce the risk of another person providing a breath sample to start the vehicle.
The cost of the interlock program is born by the participant and costs between $2,200 and $2,500.00 for one year. This is on top of an increased potential fine of up to $2,200. Although the Court can approve a concession rate or grant an exemption from participating in the interlock program (and extend the disqualification period) they will only do so in limited circumstances.
A conviction for first-time mid-range PCA will cost you.
If you have been charged with a drink-driving offence the Solicitors at Everingham Solomons can assist you in preparing and presenting your case to help achieve the best possible outcome because Helping You is Our Business
I’m often asked by Landlords what’s the best form of security to take from a tenant?
The usual forms of security are one or more of the following: –
Personal guarantee from directors or shareholders of a corporate tenant,
Cash bond; or
Bank guarantee
I generally recommend a bank guarantee.
A personal guarantee requires either a voluntary payment by the guarantors or for a landlord to sue the guarantors. Frequently, a personal guarantee proves to be ineffective because if the tenant can’t pay the rent there’s a good chance that the guarantor’s financial position may not be much better.
A cash bond involves the tenant actually paying an agreed amount of money as security for payment of the rent. If the premises are retail premises, the cash bond needs to be lodged with the New South Wales government. In the event of a breach of lease by the tenant, the landlord needs to apply to the government for the bond. As there are usually two sides to every story, commonly the tenant objects to the bond being paid to the landlord so the process for the landlord to get the benefit of the bond is neither quick nor easy.
In contrast, a landlord can require payment under a bank guarantee usually without prior notice to the tenant and the bank will simply pay the amount of the guarantee without question. That is the essence of a bank guarantee. It is an unconditional agreement by the bank to pay the landlord up to a certain amount of money on demand.
Regardless of what form of security a landlord may take, it may or may not be sufficient to fully compensate the landlord if there is a breach of the lease. The starting point for any landlord’s decision whether to lease to a potential tenant or not is to satisfy itself as best it can that the tenant has the capacity to pay the rent. This will ordinarily involve the landlord requiring financial disclosure from a tenant before entering into the lease.
At Everingham Solomons we have the experience and expertise to assist both landlords and tenants with all tenancy issues because Helping You is Our Business.
Further to Libby Campbell’s article last week in regards to hours of work and the calculation of pre-injury average weekly earnings (PIAWE), for work capacity decisions made on or after 1 January 2019, there is a new regime.
Work capacity decisions include decisions by the workers compensation insurer in respect to a worker’s capacity to work and their PIAWE.
Decisions in respect to PIAWE, which are generally mathematical calculations, require review of wages material in the 12 months prior to the worker’s injury and will be in the large part resolved by a review of the insurer, or failing that by an arbitrator of the Workers Compensation Commission.
All other decisions that would include decisions about a workers ability to work are more complex and require evidence to be gathered from medical professionals. The insurer will be asked to review their decision however, if the insurer is unswayed, then proceedings would be commenced in the Workers Compensation Commission and a decision made by an arbitrator.
The above pathways are new and only available for work capacity decisions made on or after 1 January 2019.
If you require assistance in respect to the above, please contact the writer at Everingham Solomons, because Helping You is Our Business.
The payment of weekly compensation for workers compensation matters are calculated based on the workers pre-injury average weekly earnings (PIAWE) prior to the injury date.
Generally the insurer will review the amount the worker has earned in the 52 weeks prior to the injury. The total amount is then averaged over the 52 week period and the weekly amount is known as the PIAWE figure.
For the first 13 weeks of the claim the worker will receive 95% of the PIAWE amount and from 14 weeks onwards the worker will then receive 80% of the PIAWE amount if they are totally incapacitated to work.
If a worker was injured before 26 October 2018 and they had been paid over time or shift allowance payments in the 52 weeks leading up to the injury date, then these amounts were only included in the worker’s PIAWE, and subsequent weekly payments, for the first 52 weeks of weekly compensation payments following the injury.
However there has been some legislative changes and now for workers injured on or after 26 October 2018, any overtime and shift allowance payments are permitted to be included for the purpose of calculation of weekly payments at any time. Meaning the ’52 week step down’ as it was known no longer applies to workers with an injury on or after 26 October 2018.
This is a significant benefit to workers who relied on the additional income from overtime or shift allowance payments.
If you are uncertain whether your PIAWE amount has been calculated correctly please contact us at Everingham Solomons, because Helping You is Our Business.
Click here for more information on Libby Campbell.
This is an often asked question. Typically, someone will have bought a property at auction in their own name, or from an off-the-plan development and then decide they want to buy the property in the name of their spouse or some other entity like their super fund.
A Contract for the sale and purchase of property includes conditions stating that the purchaser accepts the property in its current condition and state of repair subject to all defects both obvious and hidden. You might have heard the saying “let the buyer beware”.
Are you an Employer? If so, are you aware of each of your employee’s termination notice period entitlements are?
Everingham Solomons is proud to announce the successful bursar for 2018 is Claire Annis-Brown. Claire is an extremely well rounded student of McCarthy Catholic College having achieved excellent academic results in a range of subjects through her HSC. She is both liked and admired by her teachers and peers alike.
The payment of weekly compensation for workers compensation matters are calculated based on the workers pre-injury average weekly earnings (PIAWE) prior to the injury date.