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ARNECC Model Participation Rules Version 5

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The ARNECC Model Participation Rules Version 5 for e-conveyancing are in effect from 25 February 2019 in NSW, VIC, QLD, WA and SA.

Client Authorisation Forms

There are now two separate types of Client Authorisation Forms:

  • Client Authorisation Representative– authorises a solicitor or conveyancer to act for the client in a conveyancing transaction;
  • Client Authorisation Attorney– authorises a person acting under a power of attorney to act for the donor in a conveyancing transaction, the donor being the person giving the power.

See rules 5.6 and 6.3 for requirements.

Practitioners must ensure they use the correct Client Authorisation Form for each conveyancing transaction.

These forms are available on all By Lawyers Conveyancing matter plans within Folder ‘A. Getting the matter underway > Verification of identity folder’.

Verification of Identity in mortgage transactions

Responsibilities for verifying the identity of mortgagors have been updated. Practitioners acting for a mortgagee, must take reasonable steps to verify the identity of mortgagors in accordance with r 6.5.1(b), even where the mortgagor is represented.

Additional identity documents

Australian Evidence of Immigration Status ‘ImmiCard’ and Australian Migration Status ‘ImmiCards’ are now acceptable types of identity documents and have been added to the table in Schedule 8 of the Model Participation Rules.

All relevant By Lawyers publications have been updated to reflect the ARNECC Model Participation Rules Version 5, including the detailed Verification of Identity commentary located in all conveyancing and property matter plans under Folder ‘A. Getting the matter underway’.

Personal Property Securities Act and leases

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Personal Property Securities Act and leases

All By Lawyers Lease Publications have been updated to include new commentary on the implications of the Personal Property Securities Act  2009 (PPSA) for landlords and tenants when entering into a new lease and on assignment. The Retainer instructions and To do list precedents have also been updated to ensure that these important considerations are not overlooked.

Leases often encompass personal property, such as fit-out owned by the landlord made available under the lease, or plant and equipment owned by the tenant left in the premises on abandonment.

In such situations, the PPSA can operate to deprive the true owner of their rights if not recorded on the Personal Property Securities Register (PPSR). For example, unless a landlord registers a security interest on the PPSR in relation to their personal property which is in the possession of a tenant, they may not be adequately protected against claims on the property by third parties including the tenant’s financier.

At the time of entering into a new lease or on assignment, a landlord should consider whether registration of a security interest is required in relation to any personal property. Consideration should also be given to the inclusion of a PPSA clause in the lease to allow the landlord to enforce security interests in personal property. Any such clause must be reasonable, should be confined only to the relevant personal property concerning the lease and should not affect the tenant’s ability to obtain finance or provide security to their financier.

For further information on Personal Property Securities Act and leases , see the By Lawyers Lease publications and the By Lawyers dedicated Personal Property Securities publication.

Leases – Demolition and relocation clause – Commercial lease

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A new demolition and relocation clause for use in commercial leases has been added to the Library of clauses in all By Lawyers Leases publications. This clause was added as a result of a request from a By Lawyers user.

The new clause provides for termination by either the lessor or lessee in the event that the lessor proposes to demolish the building or a substantial portion of the building of which the premises form part, on the lessor providing 90 days written notice to the lessee. This clause also addresses the costs of relocation of the lessee’s business and requires the proposal for demolition to be genuine.

Please email us at askus@bylawyers.com.au or call 02 4858 0619 with any feedback or suggestions. We would love to hear from you!

Amendment to wills creating discretionary trust

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Amendments have been made to the following By Lawyers precedent wills creating discretionary trusts:

  1. Individual will creating testamentary discretionary trust;
  2. Client 1 will creating testamentary discretionary trust with client 2 as executor; and
  3. Client 2 will creating testamentary discretionary trust with client 1 as executor.

The precedents have been amended as follows:

Clause 7 has been amended to improve readability. The amendments do not change the effect of the wills.

Clause 9 has been enhanced to better protect the testator’s spouse. The amendments delete sub-clauses (b) and (c). These clauses gifted the residue of the estate to the spouse and provided for gifts to particular beneficiaries, respectively.

Clause (b) has not been replaced, as the spouse has been included as a beneficiary of the trust in clause (g). Previously the trust would only be established if the spouse did not survive the testator. Now the residue will always be gifted to a trust, within which the spouse is a beneficiary.

Clause (c) has been replaced with new clauses (b), (c) and (d) which provide for specific gifts to beneficiaries.

The wills can be found in the By Lawyers Wills publications.

Author review of Conveyancing (VIC) Publication

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Conveyancing (VIC) – Author review

The By Lawyers Conveyancing (VIC) Publication, which includes the 1001 Conveyancing Answers, Sale of Real Property and Purchase of Real Property guides, has been reviewed to ensure that the commentaries and precedents (including the By Lawyers Contract of Sale of Land) are in line with current law and conveyancing practice, including electronic conveyancing.

The extensive review was performed by our author Russell Cocks. As with all our authors, Russell takes a practical approach drawing on his considerable experience to cover all aspects of procedure, with a focus on practical tips that will help solicitors and conveyancers confidently run a sale or purchase matter to completion.

We invite you to explore this updated publication and to consider the wealth of assistance the guides offers for solicitors and conveyancers acting in the sale and purchase of residential property in Victoria.

Matter type changes

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There has been a technical change to the structure of our Defamation & Protecting Reputation and Neighbourhood Disputes publications. They have been changed from federal matter types to state-based matter types.

Subscribers may notice that the title of the Defamation publication now includes a state name. This is nominative only. The content of the Defamation publication is unchanged and remains the same across all states.

For state-based guides and precedents to be visible from existing matters, LEAP Desktop users will need to change their matter type from Other areas of law > Miscellaneous > Disputes to Other areas of law > Disputes.

New owners corporations regulations – VIC

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On 2 December 2018 the Owners Corporations Regulations 2007 were replaced with the Owners Corporations Regulations 2018, providing new owners corporations regulations which include amendments to the model rules for an owners corporation in Schedule 2 of the regulations.

A notable amendment to the model rules concerns changes to the external appearance of a lot and notification requirements for renovations to a lot.

Rule 5.2 requires lot owners to obtain the written approval of the owners corporation before changing the external appearance of their lot. An owners corporation cannot unreasonably withhold approval, but may give approval subject to reasonable conditions to protect the quiet enjoyment of other lot owners and the structural integrity or the value of other lots and/or common property.

Rule 5.3 provides that an owner or occupier of a lot must notify the owners corporation when undertaking any renovations or other works that may affect the common property and/or other lot owners’ or occupiers’ enjoyment of the common property.

The commentary and relevant precedents in the By Lawyers Conveyancing (VIC) guide – and the applicable sections of our very popular Reference Manual 1001 Conveyancing Answers (VIC) – have all been updated accordingly in consultation with our Victorian conveyancing author Russell Cocks.

 

Cladding rectification agreements – Sale and Purchase – VIC

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Amendments to the Local Government Act 1989 mean that solicitors acting for buyers and sellers of real estate now need to take into account any charges recorded against the property relating to funding for cladding rectification.

Concern about defective cladding used in the construction of high-rise residential buildings has resulted in the government adopting a legislative solution intended to provide some solace to unit owners who are faced with rectification costs, but it also has an impact on third-party purchasers of such properties.

Responsibility for administration of the solution has been allocated to municipal Councils, with a new Part 8B inserted into the Local Government Act 1989, which came into operation on 30 October 2018. This authorises Councils to enter into a ‘cladding rectification agreement’ with the owner of rateable land, or an Owners Corporation, and a lending body – presumably a conventional financier. Council may also be the lending body, but it is difficult to imagine, in the short term at least, that Councils will assume this role. Thus, the standard agreement will be tripartite, between the owner or Owners Corporation, the Council and a lender.

These agreements provide that the lender will advance the funds to pay the rectification works and Council will levy a charge on the land to recover the loan advance, interest and fees associated with the levy by instalments over a period of not less than 10 years.

Adjustment on purchase

In relation to the effect on departing and incoming owners, s 185L treats the cladding rectification levy as a ‘service charge’. Section 162 authorises the imposition of a service charge and s 185L (6) requires a cladding rectification charge to be paid by instalments. A vendor is obliged to disclose statutory charges pursuant to s 32A (b) of the Sale of Land Act 1962 and also charges ‘for which the purchaser will become liable in consequence of the sale’ pursuant to s 32A (c). Disclosure of current charges and any arrears may be achieved by annexing a rate notice, a land information certificate or giving an estimate, but the vendor is also obliged to disclose future liabilities due under the cladding rectification charge and information provided by Council will be crucial in this regard.

Any arrears under the levy will be the vendor’s responsibility, the current instalment will be adjusted between the parties at settlement and the outstanding levy will become the responsibility of the purchaser as a charge on the land: s 156 (6).

Section 175 allows a purchaser to continue to pay charges by instalments. A purchaser will therefore need to adjust the price to take account of the outstanding cladding rectification levy that the purchaser will become liable for and full disclosure in this regard is essential so as to allow the purchaser to set its price.

The Sale and Purchase commentary within the By Lawyers Conveyancing (VIC) Guide has been updated accordingly.

Personal Injuries – Organisational child abuse claims- VIC

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The By Lawyers  Victorian Personal Injuries Commentary has been updated by our author, barrister Nawaar Hussan, to assist practitioners who might be instructed to bring organisational child abuse claims for personal injury, or wrongful death.

Under Part XIII Wrongs Act 1958, organisations are required to take reasonable care to prevent the abuse of children under their care, supervision or authority. Victoria was the first state to introduce such legislation following the recommendations of the Royal Commission into Institutional Responses to Child Sexual Abuse.

Our commentary discusses the mechanisms for establishing a breach of duty under section 91 of the Act as well as the absence of any limitations period for personal injury claims arising from organisational child abuse, which reflects the Royal Commission’s finding that the average period for disclosure by victims of child abuse is 23.9 years. The limitation period for wrongful death claims is 3 years from when the plaintiff learned of the deceased person’s death.

With trademark By Lawyers practicality, the commentary also covers the type of evidence that is useful in supporting a claim for organisational child abuse.

After the work of the Royal Commission, organisational child abuse claims have been increasing. The By Lawyers Personal Injuries Guide assists practitioners to act for clients who may have such a claim.

Keeping up to date – Podcast

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The law never stands still! Keeping up to date with changes in the law and practice is an ever present challenge faced by law firms.

Legislation and regulations change all the time, new cases are decided which impact the law, new practice directions are released by courts and changes in document lodgement processes are made by various authorities. All these and more need to be continually noted and understood, as they can affect the way a law firm conducts client matters and does business.

Just keeping the firm’s precedents current with changes in the law is a major task – which is not billable! Using precedents which are out of date exposes the firm to risk.

Using By Lawyers commentaries and precedents eases the burden upon firms and reduces their risk.

By Lawyers have a team dedicated to tracking changes in the law in each Australian jurisdiction and ensuring that all of our content is updated as those changes happen. Firms using the By Lawyers guides can be confident that they are using commentaries and precedents which are up to date with current legislation.

In our latest podcast our Managing Director Brad Watts and LEAP’s National Marketing Manager Claire James discuss the issues around keeping up to date with the law and how By Lawyers can help firms to stay on top of changes.

 

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