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Author review – Conveyancing – Sale and Purchase – SA

19 November 2018 by By Lawyers

The By Lawyers Conveyancing SA Guide has been reviewed and updated to ensure that the commentaries and precedents are in line with current law and conveyancing practice, including electronic conveyancing.

The extensive review was performed by our author Jess Caire. As with all our authors, Jess takes a practical approach, drawing on her 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. The sale and purchase matter plans cater for both ‘sale by agent’ and ‘private sale’ engagements.

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

Personal Injuries – Organisational child abuse claims- VIC

19 November 2018 by By Lawyers

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

15 November 2018 by By Lawyers

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.

Attempts to expressly disinherit eligible persons – 101 Succession Answers NSW

12 November 2018 by By Lawyers

The recent case of Re Estate McNamara [2018] NSWSC 1661 reinforces the position that attempts by testators to expressly disinherit eligible persons in wills do not prevent the eligible person from either bringing a Family Provision claim, or from succeeding in an application for provision, or additional provision, from the testator’s estate. At 55 Lindsay J comments:

Upon an examination of the facts of the case from that perspective, and viewing the totality of the relationships between the deceased and her sons and their respective families, the deceased’s testamentary disclaimer of an intention to benefit the plaintiff is not an absolute bar to the making of a family provision order in his favour.

The deceased provided an extensive and clear direction in her will that her adult son not receive provision out of her estate. Notwithstanding this express intention, the adult child was awarded $75,000 out of the estate, although that sum was severely limited given the circumstances – see at 66:

Had the plaintiff had a consistent, supportive and loving relationship with his parents, (more particularly, his mother) throughout his life he would have a greater claim to his mother’s bounty than he has now.

The court’s discussion in McNamara should be considered by practitioners when drafting wills for clients who are seeking to disinherit eligible persons. Clients should be advised that any such attempt may not be effective and by providing instructions to draft such a will they may only serve to burden their estate with the costs of Family Provision litigation.

The By Lawyers 101 Succession Answers (NSW) reference guide has been updated to include this case.

Electronic filing in the Magistrates Court – QLD

12 November 2018 by By Lawyers

The By Lawyers Magistrates Court QLD commentaries have been updated to reflect the recent changes which introduce electronic filing in the Magistrates Court, as a result of amendments to the Uniform Civil Procedure Rules 1999 by the Uniform Civil Procedure and Other Legislation Amendment and Repeal Regulation (No. 1) 2018 and the subsequent repeal of 49 Practice Directions by Practice Direction No. 4 of 2018.

New Division 4, Part 1, Chapter 22 of the Uniform Civil Procedure Rules 1999 now sets out the rules for electronic filing. For court users to access eLodgement, it is necessary to contact CITEC Confirm to obtain a login.

The following documents are approved by the Principal Register for electronic filing in the Magistrates Court where the proceedings were commenced by a claim that was electronically filed:

Claim (Form 2)
Application (Form 9)
Statement of Claim (Form 16)
Request for default judgement (Form 25)
Default judgement (Form 26)
Affidavit (Form 46)
Enforcement Hearing Summons (Form 70)

By Lawyers Guides provide practitioners and support staff with up to date information to help make the practice of law easier.

By Lawyers Contract of Sale of Land VIC – Explanatory Memorandum

7 November 2018 by By Lawyers

BY LAWYERS CONTRACT OF SALE OF LAND (VIC) – INCLUDING s 32 VENDOR STATEMENT

Russell Cocks and By Lawyers have come together to release a new form of Contract of Sale of Land in Victoria which is available to LEAP users who take up the By Lawyers companion product and also by subscription to the By Lawyers website for non-LEAP users. This new contract is intended to make standard conveyancing in Victoria more efficient by smoothing the bumps in the conveyancing highway arising from shortfalls in the existing standard contract.

Russell is ideally placed to make these changes having been one of the authors of the standard contract over the last 25 years. Russell was largely responsible for the substantial changes achieved in the 2008 review of the standard contract and sees this NEW CONTRACT as a culmination of the desire to achieve efficiency in the standard conveyancing process. The advent of electronic conveyancing makes this the perfect time to make these changes.

First, a word about the ‘standard’ contract. For decades, a committee of the Law Institute of Victoria provided the Victorian government with a form of contract that was adopted in Regulations as the form of contract to be used by real estate agents if the proposed contract was not provided to the real estate agent by a solicitor or, more recently, a conveyancer. In practice, most contracts are provided to agents by solicitors and agents and, by and large, those contracts are in the standard form because that form has been adopted by the various proprietary software providers. The Law Institute of Victoria and Real Estate Institute of Victoria both produce a version of that contract, for which they charge, but it is the format, rather than the content, that is subject to copyright.

In September 2018 the Law Institute contract became more confusing. Because the LIV form must be based on the regulated form, the LIV cannot change any of the 28 General Conditions. So, the LIV contract now has 28 General Conditions and 12 Special Conditions, some of which in fact change the General Conditions. The NEW CONTRACT simply has 28 General Conditions, although users are entitled to introduce additional Special Conditions, but not such as to derogate from the General Conditions (see below).

The guiding principle for the successive authors of the LIV standard form has been EVENHANDEDNESS – a awkward word but nevertheless a perfect description of the desire for the contract to treat the vendor and purchaser EQUALLY. Give that it is usual practice for the vendor to prepare the contract it would be open to the vendor to produce a contract that unfairly favours the vendor to the detriment of the purchaser. This would lead to inefficiencies, with the purchaser having to negotiate a whole raft of unfair terms before even considering signing the contract. A standard, widely accepted contract avoids these inefficiencies and the NEW CONTRACT will honour those principles.

Another efficiency associated with a standard contract is that all participants in the conveyancing process know what the standard contract says. The 2008 contract sought to enshrine this principle by forbidding amendment of the General Conditions otherwise than by Special Condition so that unexpected changes could not be inserted into the General Conditions. This was achieved by the inclusion of a warranty in the contract and has proven to be successful in preventing changes to the General Conditions. However, the ability to amend by Special Condition has led to a return to past inefficiencies caused by the inclusion of pages of Special Conditions and this is the first important change to be made by the NEW CONTRACT.

The warranty about changes to the General Conditions will be a NON-DEROGATION warranty. Special Conditions can be added to the contract but they cannot DEROGATE from the rights created by the General Conditions.

This will prevent the pages and pages of Special Conditions that have become common in recent years that are designed to remove General Condition 23, or General Condition 8, or change the penalty interest rate to plus 4%, or change the number of bank cheques to 10. Such Special Conditions are not really Special Conditions at all, they are just attempts by some participants in the industry to give their clients an unfair advantage. This exercise totally defeats the advantage of a standard form contract and robs us all of the efficiency benefits that a standard form provides. By agreeing to use the NEW CONTRACT you will acknowledge that you are satisfied that your vendor client is adequately protected by the General Conditions and that your purchaser clients are likewise protected.

In practice, these interminable Special Conditions are inconsequential as they usually address issues already addressed in the standard contract or else are only relevant if default occurs and then simply produce an argument about what the Special Condition actually means. For this so-called benefit, we have to wade through pages of guff and advise our clients about all sorts of unlikely outcomes, thereby losing the benefit of a standard contract. ENOUGH!

However, proper Special Conditions will be permitted. Provided that they do not derogate from the General Conditions, Special Conditions still have a role to play in the contract. These may address aspect of the transaction that are truly unique or special to a particular contract or it may be a set of Special Conditions that relate to a specific type of contract – such as an off the plan contract that will result in the creation of an owners corporation and the vendor wishes to deal with issues that will arise after registration of the plan, or a contract that requires the creation of a covenant. The intention is not to dumb down the contract, it is to remove the unnecessary guff that undermines the efficiency of a standard contract.

When you consider that 90% of contracts relate to residential or small commercial properties, any contract that creates unnecessary hurdles in that environment is an albatross around our collective necks. If we are to enjoy the efficiencies that electronic conveyancing will bring to our practices we must first get the contract in order. It is doubtful that large CBD firms who generate telephone book sized contracts for large off the plan apartment sales will adopt this NEW CONTRACT. But for that huge number of conventional transactions that make up the bulk of our work we need a contract that is fair to both parties, easy to explain to our clients and allows us to conduct conveyancing efficiently. The NEW CONTRACT of SALE of LAND will do that.

Moving from the general to the specific, the NEW CONTRACT will improve the process in the following ways:

VENDOR STATEMENT

It takes the logical step of putting the VENDOR STATEMENT before the CONTRACT.

This allows for a front page that the user can adopt to ‘brand’ the document with firm specific details, such as name and logo, to emphasise the role of the firm in preparing the document.

The vendor statement must satisfy the disclosure requirements of s.32 Sale of Land Act but there is room to prepare the Statement in such a way that irrelevant information is deleted.

This is achieved by a Summary Feature that automatically includes the compulsory information and allows for non-applicable options to be deleted. If there is no Owners Corporation or no Notice or GAIC is not applicable then these options are deleted from the form at the outset and those irrelevant parts “collapse” and disappear from the form. This produces a much more user-friendly VENDOR STATEMENT that satisfies all relevant disclosure obligations.

The form also includes some handy commentary about requirements relating to Owners Corporation Certificates and Owner Builder Insurance that will assist in satisfying those requirements, if applicable.

CONTRACT

The preliminary pages satisfy the various ‘notice’ obligations and provide a convenient execution page.

PARTICULARS OF SALE

Allows for the relevant details to be set out in table form.

Reference to Foreign Resident Withholding is noted in ‘payment’ section.

Applicability of GST is addressed. The price is GST inclusive. If the vendor wishes to recover GST then the price must be increased to reflect the vendor’s GST liability.

Reference is made to GST Withholding obligations.

Settlement is to be on a nominated date. If it is an off the plan contract then settlement is to be 14 days after notification of registration and reference to the ‘sunset date’ is included at this point. The default period of 18 months is adopted but may be changed. The important point is that the actual date for registration is available in the PARTICULARS and it is not necessary to wade through interminable Special Conditions to locate the sunset date. The General Condition has been amended accordingly.

Standard provisions for LEASE and LOAN are included and a new provision for BUILDING/PEST REPORT is added.

Whilst reference is made to TERMS CONTRACT there are NO TERMS CONTRACT General Conditions and this rarity must be dealt with in Special Conditions.

GENERAL CONDITIONS

This is where existing practices that cause roadblocks in conveyancing have been identified and, hopefully, improved. The guiding principle has remained EVEN-HANDEDNESS so that the Conditions are, as much as possible, fair to both vendor and purchaser. 28 General Conditions have been retained so as to keep the NEW CONTRACT as close as possible to the familiar standard contract and changes have only been made where improvement was necessary.

WARRANTY

This is where the all-important non-derogation warranty is made by the vendor that the General Conditions comply with the then current copyright form of contract (2018 version at present) and that the General Conditions will prevail over any Special Conditions.

GC.1 to GC.5 no changes.

GC.6 recognises the possibility of electronic settlement.

GC.7 introduces an abbreviated electronic settlement Condition.

Existing GC.7 relating to PPSR has been deleted. It is simply not relevant to 99% of standard transactions. The long electronic settlement condition usually added as a Special Condition has been abbreviated and inserted as GC.7.

GC.8 requires the vendor to produce builder warranty insurance, if applicable.

GC.9 introduces an Off the Plan Condition.

Existing GC.9 relating to General Law land has been deleted. Again, rarely applicable.

The Off the Plan Condition links back to the sunset date specified in the Particulars of Sale (default period of 18 months from contract unless otherwise specified). Also gives EITHER party, not just the purchaser, the right to terminate. This General Condition replaces the pages of Special Conditions that simply repeat the provisions of the Sale of Land Act.

GC.10 new obligation on vendor to provide keys at settlement. Settlement to be conducted between 10am and 3pm, rather than 4pm as at present.

GC 11. formatting change.

GC.12 stakeholding. Substantial change.

Release of deposit is a huge roadblock in the efficient conduct of a conveyancing file. Unreasonable refusal is an enormous time waster. GC.12 provides that if there is no mortgage or caveat then, provided that loan approval has been obtained, there is no outstanding SPECIAL CONDITION benefiting the purchaser and no valid objection to title within 28 days, the deposit may be released.

If there is a mortgage or caveat, the vendor must provide satisfactory proof that the amount owing does not exceed 70% of the price, allowing for the possibility of FRCGTW, or 80% if the vendor provides a FRCGTW Clearance Certificate.

GC.13 GST

Whilst some changes to the wording have been made, the meaning and intent is maintained. The condition has been expanded to take account of the purchaser’s GST Withholding obligation.

GC.14 loan approval

The current condition creates unnecessary work for both vendor and purchaser and exposes purchasers to potential loss. Time for approval is extended from 14 days to the more realistic 21 days. This new condition allows for automatic extension of loan approval, subject to the absolute ability of the vendor to end the contract if an extension is requested.

A similar building/pest report condition is added. To avoid disputes, the purchaser must be satisfied with the report(s) or is able to end the contract. The purchaser has an unfettered ability to end the contract and the vendor must accept that the contract is NOT binding on the purchaser until 7 days have elapsed. However, this is a better option than the possibility of arguments about “major structural defects” as often arise now.

GC.15 adjustments

The current condition has been adopted with the addition of an obligation on the purchaser to provide copy certificates and provision for Foreign Resident Capital Gains Tax Withholding.

GC.16 time

The current condition is adopted, with the extra provision allowing the parties to agree in writing to extend or reduce the time for performance.

GC.17-20 no change

GC.21 notices

Addition to confirm that the vendor is liable for compliance with notices served BEFORE the date of contract.

GC.22 lease

A new condition requiring the vendor to provide the purchaser with the original or an acknowledged copy of any lease affecting the property.

GC.23 terms contract provisions deleted and replaced with existing GC.24

GC.24 abandoned goods

This new Condition passes ownership of abandoned goods to the purchaser.

GC.25 default

Perhaps the greatest waste of time in a conveyancing transaction occurs when one or other of the parties default in performance of the contract. Claim and counterclaim occur in a time-poor environment and additional costs are rarely recovered. This default condition allows for interest and limited costs to be claimed at settlement and postpones claims for other losses until after settlement.

GC.26 interest – no change

GC.27 default notice

A two-tier notice regime calls for a default notice as the first step with 7 days to remedy the default and specified costs of $440 on the notice.

GC.28 rescission notice

This follows if the default is not remedied and ends the contract after 10 days. Again, costs on the notice are specified at $440.

Consequences of ending the contract are in conformity with the standard contract.

SUMMARY

The most significant change effected by the NEW CONTRACT is the non-derogation principle whereby the General Conditions prevail over Special Conditions. This will result in a standard contract that will promote efficient conveyancing in the electronic environment.

Substantial improvements to deposit release, loan approval and consequences of default, together with improvements relating to off the plan sales, adjustments, leases and abandoned goods are designed to allow standard conveyancing files to be handled efficiently and cost effectively in the electronic environment.

Criminal procedure NSW

6 November 2018 by By Lawyers

Mandatory pre-trial disclosure has been introduced into Division 3 of Part 3 of the Criminal Procedure Act 1986, which now requires mandatory pre-trial disclosure for both the prosecution and the accused. The provisions are set out at ss 142 – 144 of the Act.

These provisions only apply after an indictment has been presented or filed in proceedings: s 141. As this only occurs after the matter is transferred from the Local Court to the District or
Supreme courts, mandatory pre-trial disclosure does not apply to summary matters, or to indictable matters which proceed summarily – that is, matters that remain in the Local Court.

If the matter is committed to a higher court on the basis of a plea of not guilty, the mandatory pre-trial disclosure provisions will need to be considered and complied with. The accused’s obligation is to provide:

(a)  the name of any Australian legal practitioner proposed to appear on behalf of the accused person at the trial,

(b)  the nature of the accused person’s defence, including particular defences to be relied on,

(c)  the facts, matters or circumstances on which the prosecution intends to rely to prove guilt (as indicated in the prosecution’s notice under section 142) and with which the accused person intends to take issue,

(d)  points of law which the accused person intends to raise,

(e)  notice of any consent that the accused person proposes to give at the trial under section 190 of the Evidence Act 1995 in relation to each of the following:

(i)  a statement of a witness that the prosecutor proposes to adduce at the trial,

(ii)  a summary of evidence that the prosecutor proposes to adduce at the trial,

(f)  a statement as to whether or not the accused person intends to give any notice under section 150 (Notice of alibi) or, if the accused person has already given such a notice, a statement that the notice has been given,

(g)  a statement as to whether or not the accused person intends to give any notice under section 151 (Notice of intention to adduce evidence of substantial mental impairment),

(h)  if any expert witness is proposed to be called at the trial by the accused person, a copy of each report by that witness that is relevant to the case and on which the accused person intends to rely,

(i)  notice as to whether the accused person proposes to raise any issue with respect to the continuity of custody of any proposed exhibit disclosed by the prosecutor,

(j)  notice of any significant issue that the accused person proposes to raise regarding the form of the indictment, severability of the charges or separate trials for the charges,

(k)  if the prosecutor disclosed an intention to adduce at the trial any audio or visual recording or the transcript of any audio or visual recording:

(i)  any request that the accused person has that the recording or transcript be edited (other than in circumstances to which subsection (2) (d) relates), and

(ii)  particulars sufficient to clearly identify the edits that the accused person requests.

As pre-trial disclosure relates only to trial matters in the superior courts, it is substantively outside of the scope of the By Lawyers Criminal Local Court guide. However because the provisions may be relevant to the overall strategic approach for a successful defence of indictable charges, a note has been added to the commentary alerting practitioners to these requirements.

Workers Compensation and Motor Accident changes – NSW

6 November 2018 by By Lawyers

The Workers Compensation Legislation Amendment Act 2018 amends both the Workers Compensation Act 1987 and the Motor Accident Injuries Act 2017.

Some provisions of the amending Act have now commenced, namely those removing limitations on workers injured in motor vehicle accidents obtaining statutory benefits for treatment and care under that Act where their entitlement to workers compensation has ceased, or where they recover damages from the employer in respect of the injury.

Schedules 1, 2 and 3 of the amending Act, which are yet to commence, provide for:

the abolition of the administrative system of dispute resolution and reinstatement of the jurisdiction of the Workers Compensation Commission to determine disputes and make determinations of permanent impairment;
the introduction of a simplified process to determine an injured worker’s pre-injury average weekly earnings, with a new Schedule 3 to the Workers Compensation Act 1987 providing the method for determining PIAWE and allowing insurers and workers to agree on the figure for PIAWE.

The By Lawyers NSW Workers Compensation and Motor Vehicle Accident publications have been updated to deal with these amendments.

Scary short-stays

1 November 2018 by By Lawyers

By Russell Cocks, Solicitor

First published in the Law Institute Journal

One of the innovations adopted by property law principles during the Twentieth Century was the ability to divide real estate into stratas. Previously, ownership of land had traditionally given to the owner of that land the right to that land ‘from heaven to hell’. All the way up and all the way down. An owner was entitled to prevent anyone from burrowing under or building above their land. There were some exceptions, generally in aid of government endorsed enterprises such as mining companies, but the gender specific saying “every man’s home is his castle” was endorsed to the fullest extent by the law.

However, the pressures of living in large metropolises demanded that the law recognise a way that land could be divided not only on a horizontal plane, but also vertically into stratas, so that the teeming masses could be accommodated in as small an area as possible. In Victoria, this led to the Strata Titles Act in 1967 formalising ad hoc ‘company share’ ownership schemes that has festered in preceding decades. The process culminated in the Owners Corporation Act in the early years of the new millennium that sought to bring a structure not only to ownership, but also to the difficulties of cohabitation, in a broad sense.

Indeed, the Owners Corporation Act is primarily concerned with the rights and obligations of the various owners of the land, collectively the Owners Corporation, leaving it to the Subdivision Act to regulate where the lines are drawn, both on the ground and between the various stratas. Regulating Body Corporates under the Strata Title Act proved to be a training ground for the sort of issues that can arise when large cohorts of people occupy a small area of land and VCAT is now the forum for those issues to be aired.

It would be fair to say that the traditional demographic of strata ownership in the second half of the twentieth century were elderly people looking to downsize, a relatively stable and non-litigious group. But the advent of large-scale developments in inner city locations designed to appeal to a younger and more mobile demographic caused a seismic shift in the profile of residents in buildings subject to the Owners Corporation Act.

Nowhere is this more apparent than in the short-stay environment. Inner city apartments, often with in-house facilities such a gyms and swimming pools, are attractive to people who are looking to visit a city for a short time, but the lifestyle of such people is often likely to clash with long term residents more interested in a quiet, stable lifestyle. Complaints by and to Owners Corporation Managers have, by and large, been unsuccessful as the Courts have tended to put the proprietary right of the owner (including the right to lease) above the concerns of other residents. Thus, attempts to pass Rules preventing Short Stays have been held to be beyond the power of Owners Corporations and various other attempts to rely on building regulations have been equally unsuccessful.

This has resulted in legislative intervention, but the solution recognises that not all short-stays are toxic. From 1 February 2019 the Owners Corporation Act will proscribe certain behaviour in the short-stay environment and establish a process whereby complaints relating to breaches of those behaviour standards will be dealt with, initially at least, by the Owners Corporation. After receiving a written complaint, or at its own instigation, the Owners Corporation must give the owner notice of the complaint and require the breach to be rectified and may also refer the breach to VCAT.

VCAT has power to hear and determine short-stay disputes and may issue prohibition orders, award compensation and impose a civil penalty. Prohibition orders may be made when a notice has been served on 3 separate occasions in 24 months but ceases if the property is sold. Compensation may be awarded to an occupier who has suffered loss of amenity, to a maximum of $2,000, and the short-stay occupier AND short-stay provider are jointly and severally liable to satisfy a compensation order and to pay any civil penalty.

This measured approach to a growing problem may be sufficient to ensure that short-stay providers make a greater effort to control the potentially anti-social behaviour of some short-stay users.

By Russell Cocks, Solicitor

First published in the Law Institute Journal

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