What can I do if I own a property with somebody else and I am the only one who wants to sell it?
Section 66G of the Conveyancing Act 1919 provides that where any property is owned by more than one person, one of the parties, who owns at least 50%, can approach the court and seek orders that trustees be appointed and for the property to be sold.
The money would then be held by the trustee and distributed in accordance with any orders of the court.
The court will generally only refuse an application for a sale pursuant to section 66G under special circumstances. An example of a reason might be if it has previously been agreed between the parties that they will not sell the property unless everyone agrees.
In respect to the sale proceeds and how the trustee will distribute those, the following rules apply:
the starting point is that the proceeds will be distributed in accordance with the title as provided for on the certificate of title;
if the property is held in joint names, but the parties have not contributed equally to the acquisition/maintenance, there is a presumption that the property is held in a resulting trust in proportion to the respective contributions;
this presumption of a trust can also be rebutted in cases where there may be a presumption of advancement. Presumptions of advancement come about mostly in cases of property that is held jointly by family members and there may be a presumption that one party care or provide for the other, such as a parent/child relationship.
If you should have any queries about selling land that is jointly owned, please do not hesitate to call us at Everingham Solomons because Helping You is Our Business.
It depends. It is always important to review the requirements of the Duties Act in each case before assuming that a rural land transfer will be stamp duty free.
Mum and dad have owned a rural property since the 1970s. The farming business is carried on by a proprietary limited company. The shareholders and directors are mum and dad.
As the son and daughter-in-law now run and guide the farming business, mum and dad have decided to transfer part of the farming land to them valued at about $1.5 million. Mum and dad also propose to make the son and daughter-in-law directors of the farming operations company.
As the land was acquired prior to the introduction of Capital Gains Tax, there is no pre-CGT taxation on the transfer of the land.
Will the land however attract stamp duty of about $68,000.00 or will it be stamp duty free under the intergenerational transfer provisions contained in the Duties Act?
In order to obtain the benefit of the exemption, the primary production business must be carried on by the son and daughter-in-law and be continued to be carried on by them or a member of their family.
While the word “member” in relation to the family of the transferee (the son and daughter-in-law) is defined broadly and goes both up and down the family tree, it does not include family owned or controlled entities such as companies and trusts.
Since neither the son nor daughter-in-law will be carrying on the business and as the trading company is not a member of their family, the exemption will not be available. $68,000.00 stamp duty would be incurred if the transaction proceeds.
It is always important to review closely the requirements of the Act in each particular circumstance before proceeding with a family farm transaction.
At Everingham Solomons we have the experience to assist you with all your property needs because Helping You is Our Business.
No, not the winner of the 1985 Melbourne Cup but invasions of a person’s interest in the beneficial use and enjoyment of his land.
Nuisance is a branch of the law, which defines obligations of neighbourliness.
The nuisances with which farmers are probably most familiar are fire and noxious weeds.
The risk of fire at harvest time is well known to farmers. A fire that gets away during a harvest on wheat country can destroy hundreds of acres of crops. Losses can run to the hundreds of thousands of dollars. If the owner of the land where the fire started had not properly assessed the risk of the fire and taken reasonable steps to protect against it then he will be liable for the loss of his neighbour’s crops. If those crops are insured against fire then it will be a tussle between insurance companies. If not, then it can get very messy.
St John’s Wort is a dreadful weed. Farmers have a statutory obligation to suppress and destroy it on a continual basis. A farmer who does not take reasonable steps to protect his neighbour from the spread of the weed will be liable for the harm that it causes. Such harm includes the cost incurred by the neighbour to check the spread of the weed on to his property, being a cost that he would not be put to but for the nuisance emanating from his neighbour. On large holdings with common boundaries of several kilometres, that cost can amount to tens of thousands of dollars per year. There is an effect on land value as well.
Farmers, more so than any other group, because of the challenges they face, deal with their neighbours in a reasonable and fair-minded way but there are some rogues about, of whom it might be said: “what a nuisance” but are likely referred to in far more colourful language. The litigation team at Everingham Solomons can help you with nuisance questions because Helping You is Our Business.
With the summer months fast approaching, attention is once again turning to the use of backyard swimming pools. Following a series of inquests into swimming pool deaths, recommendations have been made to improve pool safety around swimming pools. Last month the Swimming Pools Amendment Bill 2012 was introduced into Parliament. The amendments sought to be made to current legislation are designed to address the high rate of non-compliance with swimming pool barriers. Possible changes to the current legislation centre around the requirement for private swimming pools to be registered, self certification of pools and an inspection program.
The proposed amendments will require pool owners to self-register their pool, free of charge, on a statewide online register. Pool owners will be required to self-assess that their pool complies with the requirements. The registration process will involve pool owners using a checklist to help them identify defects in swimming pool barriers and to take the necessary remedial steps to make their pool barriers compliant. Research has shown that even simple defects such as gates that do not self-close or gaps under fences can lead to tragedy when a child is able to gain access to a unsupervised pool.
The registration and self-assessment checklist has been formulated to raise awareness of pool safety and to ensure that pool owners take responsibility to make their pool barriers compliant. The steps taken to make a pool compliant today could save the life of a child tomorrow.
The proposed changes also seek to amend conveyancing and residential lease legislation to require vendors and landlords to have a valid swimming pool compliance certificate before selling or leasing their premises
It is proposed that there will be an 18 month phase-in period to permit landlords and property owners sufficient time to comply with the new requirements if the Bill is enacted.
Additionally, it is proposed that Councils will be required to develop locally tailored risk-based inspection programs in consultation with local communities. The Bill seeks to impose mandatory inspections to be carried out on pools associated with tourist and visitor accommodation due to the increased exposure of those pools to members of the public.
At Everingham Solomons, we have the expertise to assist you with all aspects of your sale, purchase and leasing of property because Helping You is Our Business.
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When can somebody lodge a caveat over land? The answer is when they have an interest over the land.
What exactly does it mean to have an interest over the land? Common examples of caveatable interests are interests of a purchaser under a contract for the sale of land, interests of a mortgagee and somebody who contributes to the purchase price of a property. Options to purchase land can also invoke a caveatable interest.
Interests that do not give you a caveatable interest over the land are, debts (that do not involve land), or any other contractual rights that do not involve the land.
A more difficult question is if there is a contract between the owners of the land and a builder. This wouldn’t ordinarily give rise to a caveatable interest over the land unless the interest is elevated by the owner giving the builder a charge over the land. In that instance the contractual right would become a caveatable interest over the land and a caveat could be lodged.
This type of scenario was considered in Composite Buyer v Soong (1995) 38 NSWLR 286. This was a matter where the owners of the land gave a charge to the lenders of money. This was held to be a caveatable interest as it was expressly stated that a charge was to be put over the property.
In the case of Epple v Wilson [1972] VR 440 VSC, an employee owed his employer money and they reached an agreement that said in part ‘Any proceeds due to me from the sale of my house is to be paid to (the employer)’. This was held not to be a caveatable interest as although the money was to come out of the proceeds it did not create an interest over the land.
If you should have any queries in respect to caveats, please do not hesitate to contact the offices of Everingham Solomons because Helping You is Our Business.
The NSW Treasurer has announced changes to State taxes and grants which are being heralded as “the most generous scheme in Australia”. Let us examine three key changes.
Firstly, from 1 July 2012, the New Home Grant of $5,000 will be provided to buyers of new homes, whether off the plan or newly built, up to the value of $650,000. The same grant will be available to buyers of vacant land up to the value of $450,000 upon which a new home is to be built. This incentive is open to non-first home buyers and investors alike.
A new home is a home that has not been previously occupied or sold as a place of residence, and includes a home that is a substantially renovated home.
Secondly, from 1 October 2012 a newly named First Home Owner Grant (New Home) Scheme will be introduced for first home buyers who purchase or build a new home. It will replace the current $7,000 First Home Owner Grant from 1 October 2012. The grant of $15,000 applies to contracts signed on or after 1 October 2012 to 31 December 2013. The grant will then be reduced to $10,000 as and from 1 January 2014. The new scheme will apply to first home buyers who purchase or build a new home valued up to $650,000.
Thirdly, from 1 July 2012 the First Home—New Home scheme provides eligible purchasers with exemptions on stamp duty for new homes valued up to $550,000 and concessions on stamp duty for new homes valued between $550,000 and $650,000. The same exemption will be available to buyers of vacant land up to the value of $350,000 and concessions on duty will be available for purchasers of vacant land valued between $350,000 and $450,000 who intend to build a new home on the site.
Importantly First Home—New Home exemptions or concessions do not apply to the purchase of an existing dwelling.
Also, if you are eligible for a stamp duty exemption/concession under the First Home – New Home Scheme, you cannot receive the $5,000 New Home Grant.
Furthermore, if you are eligible for a First Home Owner Grant, you cannot receive the $5,000 New Home Grant for the same property.
If you are considering buying a new home or vacant land to build your new home on, our experienced property team can help answer all of your questions, because Helping You is Our Business.
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Since 1 November 2011, a mortgagee (financial institution) has a higher duty to the mortgagor (property owner) when selling their property as a result of the property owner having defaulted on their loan repayments.
Section 111A of the Conveyancing Act 1998 (NSW) replaces a duty to ‘act in good faith’ with a negligence style duty of care.
Financial institutions already owe this duty to corporations but not to individuals.
Prior to these amendments, the law only required the financial institution to act in good faith. This meant that the financial institution should not act willfully and recklessly and sacrifice the property owner’s interests. The only remedy was for the property owner to go to the Equity Division of the Supreme Court. This meant that sales referred to as ‘fire sales’ were often just that and purchasers would be able to pick up property well below market value, with little or no recourse for the property owner.
Since November 2011 a financial institution must take reasonable care to make sure that the property is not sold for less than market value. If they breach this duty they will be liable to the property owner in damages. More importantly the financial institution will not be able to contract out of this duty. This means that the mortgage documents that are signed when the property owner takes out a loan will not allow the financial institution to exclude the provision.
It is also important to understand that this obligation extends to not only the financial institution but also their agents which would obviously include real estate agents.
The banks must take all reasonable care to ensure that the property is sold for either:
not less than market value; or
the best price that can be reasonably obtained.
‘Reasonably obtained’ would mean that the bank must take steps to obtain the best result which may include obtaining professional valuations, advertising the property, leaving it on the market for a reasonable period and allowing inspections.
This is definitely a step in the right direction for those people whose houses are sold by banks. If we can be of any assistance, the property group at Everingham Solomons will be happy to assist you because Helping You is Our Business.
The strictness of the law relating to the sale of real estate in NSW can have devastating consequences for a successful purchaser at an auction.
It is possible for a purchaser to be the highest bidder after the reserve has been reached or the auctioneer announces that the property is on the market, have it knocked down to him or her and then end up with nothing. It is terrible because the purchaser will have gone to great trouble and spent money on preparing for the auction but, more than this, it is terrible because the joy of being the winning bidder is snatched away so quickly. At one moment, the purchaser is as happy as a butterfly and the next, as sad as a flute.
It happens when, after the auction, the vendor refuses to sign the contract for sale and forbids the auctioneer from signing it on his or her behalf.
It does not happen often but when it happens, it is because the effect of a particular section of the Conveyancing Act 1919 is that no legal proceedings can be brought to enforce the sale of land without a memorandum or note of the contract for such sale signed by the party against whom enforcement action is to be taken.
The signed writing does not have to be the contract for sale on display at the auction. Courts have accepted letters to third parties, receipts, drafts and correspondence (even correspondence denying liability under the contract) to be sufficient. The writing can comprise several different documents, provided there is sufficient connection between them and they are signed. Even an email can be said to be signed.
This is all very well but arguing in court about whether there is sufficient writing to enforce a contract for sale of land is time consuming, expensive and uncertain. Better that the problem with auctions be fixed by legislation. It is a State matter, a job for Premier Barry O’Farrell’s Government.
In the meantime, if you are selling or leasing real estate of any kind, the property group at Everingham Solomons will be happy to assist you because Helping You is Our Business.
All those involved in the design of structures such as architects, engineers and building designers are now required to practice “safe design” under the new work health and safety laws.
The concept of “safe design” requires a designer to ensure, so far as is reasonably practicable that the plan, substance or structure is designed to be without risks to the health and safety of persons.
Designers will have a duty to provide a safety report and risk assessment to their clients for all design projects including residential housing.
A study in 2007 estimated that up to two thirds of the deaths in the construction industry was linked to poor design and planning.
The purpose of the new laws is to minimise the number of deaths and injuries associated with construction.
In this regard the designer must consider the building or structure during the construction phase, maintenance and end of life demolition.
Examples of safe design include:
Specifying non toxic paints
Placing permanent anchor points on the roof for maintenance
Ensuring the risk from overhead power lines is shown on plans
It is likely that designer’s costs will increase however if the aim of eliminating deaths and injuries is achieved, the cost will be justified.
At Everingham Solomons we can service all of your legal needs because Helping You is Our Business.
A recent case in the NSW Supreme Court provides a timely reminder of the potential problems that can be encountered if a Contract does not spell out all of the terms agreed upon by the parties. In this case the irrigated farming land sold recorded the sale of the land but was silent in relation to the water entitlements.
The Walsh family had farmed irrigated land since the 1950s. Family members were involved together in farming partnerships until 2000 when it was decided that those partnerships would be dissolved and the irrigated farming land would be sold.
Prior to selling the land, Graham and Maurice were co-owners of the farm. By Contract for Sale of Land, Graham sold his interest in the farm to Maurice. At the time of this sale Graham and Maurice also jointly held shares in the water entitlements used to irrigate the farming land. Both Graham and Maurice treated Graham’s interest in the water entitlements as having been transferred with the land. However following the sale of land, it was discovered that the water entitlements had not been transferred to Maurice and there was no express reference to the transfer of water entitlements in the Contract.
Maurice claimed that the Contract transferred the water entitlements from Graham to Maurice at the same time as the title to the farm was conveyed between them.
Graham claimed that he still held a half interest in the water entitlements.
Ultimately the court found in favour of Maurice that Graham held his interest in the water entitlements in trust for Maurice, who was then entitled to an order for the transfer of that interest to him.
Whilst a favourable result was achieved for Maurice in the end, it was a time-consuming and stressful process for Maurice to undergo. A lot of turmoil can be avoided by ensuring that matters are not left to chance and the terms of your agreement are clearly recorded in the Contract before you sign it.
At Everingham Solomons, we have the expertise to assist you with all aspects of your sale or purchase of land because Helping You is Our Business.
Click here for more information on Lesley McDonnell
What can I do if I own a property with somebody else and I am the only one who wants to sell it?
