obiter | ByLawyers News and Updates

Family law property dealings – FED

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For the assistance of practitioners conducting family law property dealings, a new folder has been added to the By Lawyers Family Law publication. Commentary and precedents are available to assist family law practitioners at the point of a matter where real property needs to be transferred between the parties.

The new folder is called If required – Real property dealings. The commentary and precedents within the new folder are extracted from the By Lawyers Conveyancing and Property publications. They provide guidance and the necessary forms and precedents to verify the client’s identity to the relevant standard for electronic lodgments of transfers and dealings with real property.

The new folder contains the following precedents and commentary required for the electronic settlements process:

This useful content has been added to the Property Settlement guide and the Financial Agreements guide. The new folder can be found in Finalising the matter on both matter plans. The location of this new content reflects the fact that family law property dealings are typically effected upon finalisation of the matter.

Family law practitioners are reminded that the commentary in both the Family Law Property settlement and Financial agreements guides cover the considerations and procedure for transfers of real property in family law matters. The By Lawyers 101 Family Law Answers reference guide also provides helpful information which includes valuing real property in the family law context, stamp duty implications of real property transfers in family law, together with coverage of capital gains tax and foreign resident withholding payments.

This enhancement arises from feedback from a By Lawyers subscriber. We value such feedback and always love to hear our users. Don’t hesitate to get in contact: askus@bylawyers.com.au

Community titles – WA

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A statutory regime creating community titles has been introduced in WA.

The Community Titles Act 2018 commenced in full on 30 June 2021.

The principal object of the Act is to facilitate the subdivision of land into parcels for separate development or disposition, with an interest in associated land in the nature of common property. The separate parcels can then be further subdivided.

The Act permits a single parcel of freehold land to be subdivided in a way that creates up to 3 tiers of schemes in one community scheme. Each scheme has its own community corporation. A community corporation is similar in function to a strata owners corporation. It is established on registration of the scheme. Each scheme also has its own set of by-laws to govern it and the common property.

The Act enables the creation of community titles (land) schemes and community titles (building) schemes within a community scheme.

Community title usually applies to large estates. These can sometimes include more than one residential lot as well as commercial and retail lots. The management of community title schemes can be complex. They can often span large areas of land with mixed – potentially  conflicting – uses. One issue that should be borne in mind by practitioners acting for purchasers of residential units in a property subject to a community title scheme is that there can be by-laws for both the strata scheme and the community titles scheme which apply to the lot the client is purchasing.

Much like strata titles, community title schemes are managed by committees and meetings. The community scheme committee deals with day-to-day issues and general meetings are held for more substantial issues.

These amendments bring WA property law into line with most other Australian states.

The commentary in the By Lawyers Conveyancing (WA) publication has been updated. It now includes details of how community schemes are created and operated, with specific commentary on:

  • Community development statements;
  • Scheme documents and registration;
  • Functions of a community corporation; and
  • Buyer information requirements.

Conveyancing To do lists – All states

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The By Lawyers Conveyancing To do lists have been enhanced. As a result of recent feedback from a subscriber, space has been added next to the checkboxes in the Sale of Real Property and Purchase of Real Property guides. This extra space can be used to enter the date that a task has been completed, or any other note relevant to that particular aspect of the matter’s progression.

This small but important enhancement to the utility of these popular precedents will be extended to other guides in due course.

To do lists precedents are available in most By Lawyers guides. They reside within Folder A. Getting the matter underway on the matter plans and are an essential matter and risk management tool.

The Conveyancing To do lists chronologically set out the usual steps to be completed in a sale or purchase matter and allow team members working on the file to tick off each step as the matter progresses. This ensures that nothing important is missed. It also assists with seamless continuity when multiple people are working on a matter. These documents can be of particular assistance to team members who are unfamiliar with a particular area of law, or when assigning a task to more junior staff and assessing their progress or providing training.

To do lists can be printed out and attached to the file for manual completion, or ‘pinned’ to the top of the LEAP matter and competed electronically.

In order to pin a To do list to the top of the correspondence window in a LEAP matter, simply right-click on the precedent after it has been saved into the matter and select ‘Pin to top’. It will then stay at the very top of all correspondence in the matter as a handy reminder and reference tool.

By Lawyers love feedback from subscribers! If you have a suggestion or request, please don’t hesitate to get in contact: askus@bylawyers.com.au.

Contracts subject to finance – Conveyancing – NSW

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New commentary and precedents for Contracts subject to finance have been added to the By Lawyers New South Wales Conveyancing Purchase of Real Property publication.

As a result of a suggestion from a By Lawyers user, we have updated the Purchase of Real Property (NSW) Guide with a new section of commentary and a folder of precedent letters.

The commentary now includes a section titled Contracts subject to finance, which discusses the increasingly common situation where a purchaser has not secured unconditional finance approval before exchange. Practical information is included on:

  • negotiating the inclusion into the contract of a special condition making completion subject to finance;
  • the effect of unsuccessful finance applications;
  • seeking an extension of time from the vendor where necessary;
  • serving written notice where finance falls through;
  • the requirement of the purchaser to not otherwise be in default when ending a contract;
  • continuing without unconditional approval;
  • forfeiture of deposit and damages – including negotiating a reduced amount.

The following new precedents to assist with contracts subject to finance have been added to Folder C. NEGOTIATIONS & EXCHANGE > IF REQUIRED – CONDITIONAL CONTRACTS:

  • Letter to vendor’s solicitor confirming contract unconditional;
  • Letter to vendor’s solicitor requesting extension of time; and
  • Letter to vendor ending contract.

At By Lawyers we pride ourselves on the cooperative and collegiate relationship we have with the many firms using our commentary and precedents daily. We value the feedback that we receive as it helps us continue to improve our publications, as in this instance. We love to hear from you!

Retirement villages – NSW

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Following recent changes to the Act, the Retirement Villages Amendment (Asset Management Plans) Regulation 2021 and the Retirement Villages Amendment (Exit Entitlement) Regulation 2021 have now commenced.

Asset management plans

The regulations require operators to maintain an asset management plan for each village they manage or operate. They must have a copy available for inspection at all reasonable times by a resident, prospective resident or a person acting on their behalf.

Operators must also prepare a 3-year report for capital maintenance, extracted from the asset management plan, to inform expenditure for major items of capital in the annual budget.

Exit entitlements, recurrent charges and right of entry

The regulations also affect exit entitlements and recurrent charges. They provide that an operator may enter premises in certain circumstances to facilitate the sale of the premises.

By Lawyers keeps you up to date

The By Lawyers Retirement Villages (NSW) guide has been updated accordingly. The effect of the new regulations is detailed in the commentary. There is also a new precedent ‘Letter to client providing advice on village contract’ which has been added to Folder B on the matter plan. The Retirement Villages (NSW) guide is included in our Conveyancing (NSW) publication.

See our related Obiter post Retirement Villages (NSW) – Amendments concerning the recent amendments to the Act.

Build-to-rent – NSW

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The New South Wales Government has introduced tax concessions for new build-to-rent housing projects. These potentially valuable concessions will remain applicable until 2040.

The term build-to-rent applies to large-scale residential unit developments constructed with the intent of being kept long-term and rented out to lower-income families at affordable prices. The build-to-rent model has been successful overseas and is now being encouraged in New South Wales.

Eligible developments will receive:

  • a 50 per cent reduction in land value for land tax purposes; and
  • an exemption from foreign investor duty and land tax surcharges – or a refund of any surcharges already paid.

The concessions are expected to encourage and support the supply of large-scale rental housing that is professionally owned and managed. The rationale is that such accommodation provides tenants with security of tenure and quality rental services. For a developer to qualify for the scheme, each tenant must be provided with a range of lease term choices, including the option of entering into a fixed term lease of at least 3 years.

These concessions only apply to housing developments that contain at least 50 self-contained dwellings, where construction commenced after 1 July 2020. The dwellings must be used specifically for the purpose of build-to-rent.

See the Treasurer’s guidelines for further information including full eligibility requirements.

The By Lawyers 1001 Conveyancing Answers (NSW) guide has been updated accordingly. This  comprehensive resource is located in the Reference materials folder at the top of the matter plan in every By Lawyers New South Wales conveyancing publication.

Certificates of title – NSW

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The NSW Government has approved the cancellation of all remaining paper certificates of title as part of the implementation of electronic conveyancing. All remaining paper certificates of title are expected to be cancelled in April 2021. Certificates of title will then no longer be evidence of indefeasible title. The By Lawyers Conveyancing and Property guides will be amended accordingly at that point.

Implications

  • For solicitors and conveyancers any lien held over a certificate of title as a form of security for payment of costs will become ineffective.
  • Equitable mortgagees holding certificates of title as security will need to make alternative security arrangements.

Alternative security for professional costs 

  • A solicitor’s lien over all client documents created or obtained in the matter.
  • Creating a charge for the repayment of costs over the client’s real property which entitles the firm to lodge a caveat on title until all costs are paid.
  • Authority to pay professional fees and disbursements from client funds held in the trust account.
  • Guarantee clause for the performance of the agreement by a guarantor, and creating a charge over the guarantor’s real property.

All By Lawyers Costs Agreements provide for these methods of security.

Alternative protection for lenders 

  • Lien over other documents or assets held by the borrower to secure the repayment of the loan.
  • Ensuring that loan agreements contain a right to register a mortgage.
  • Lodging a caveat.

The By Lawyers Mortgages (NSW) Guide contain a ‘Mortgage Linked Loan Agreement’ that is linked to the mortgage and incorporates the provisions found in the By Lawyers ‘Registered Memorandum AJ843928’. A copy of the memorandum of common provisions is recorded at NSW Land Registry Services and can be used at no additional cost by our users.

The By Lawyers Mortgages (NSW) Guide also covers caveats and contains an ‘Acknowledgement of debt – Caveatable Interest’ that creates an interest in the borrower’s real property entitling the lender to register a caveat on the property to secure repayments.

Cancellation of ALL certificates of title

Keep an eye out for the upcoming cancellation of ALL certificates of title, paper and electronic, in NSW. This will see the removal of the requirement to lodge consents and changes to the requirements relating to verification of identity, right to deal and retention of proper evidence.

There will be another Obiter post from By Lawyers when our guides are updated for these developments.

Purchase of real property – TAS

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The By Lawyers Purchase of real property guide for Tasmania has been reviewed and enhanced.

Enhancements resulting from this extensive review, which will assist Tasmanian property practitioners, include:

  • Various sections of commentary have been revised and re-ordered, to better reflect the usual flow of the purchase process.
  • The Matter plan now includes a separate section for Property Transfer Duty.
  • There are new and amended commentary headings, for improved searchability.
  • The commentary under the Property heading has been expanded to include a discussion of the various types of title.
  • Commentary under the Price and Taxes headings has been re-organised and expanded.
  • The coverage of Disclosure and Property Transfer Duty has been enhanced with references to the standard contract and common practice.
  • There is new commentary on the Submission of Transfer and Notice of Sale.
  • New commentary has been added on the specific stages of the settlement process for purchase of property.
  • All precedents have been reviewed and enhanced where necessary to reflect current practice.

Practitioners are also reminded of the Library of special conditions located on both the Sale of real property and Purchase of real property matter plans. These useful precedent clauses are located in Folder C. Contract and Folder D. Negotiations and exchange, respectively. This extensive library contains eighty drafted special conditions which can be cut and paste into the contract, either directly or with bespoke amendments, to suit the specific requirements of almost any transactions and circumstances.

This review is part of the continuing commitment of By Lawyers to updating and enhancing our publications to help our subscribers enjoy practice more.

A full description – Conveyancing – NSW

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The popular By Lawyers resources A full description of the purchase process in NSW and A full description of the sale process in NSW have recently been reviewed.

As a result of the review a new active hyperlink has been included in the sale version, leading to the Revenue NSW land tax page. This helps practitioners easily access the current threshold for the unimproved value of the land, to determine whether a client is liable for land tax. Land tax is generally only payable on investment properties, as there is a primary residence exemption.

These two helpful resources can be found in the Reference materials folder located at the top of the Sale of Real Property (NSW) and Purchase of Real Property (NSW) matter plans.  They provide a detailed summary of the typical progression of residential sale or purchase matter. Also available in the Reference materials folder is A brief explanation of the transition to E-conveyancing and how to get connected.

These resources, especially the two A full description… summaries, can provide valuable practical assistance for anyone new to conveyancing transactions, for practitioners and support staff  who only conduct conveyancing matters occasionally, or for team members inexperienced in conveyancing who have to step in at short notice in the unexpected absence of a colleague to look after a conveyancing file which is already on foot.

This review is part of by Lawyers continuing commitment to updating and enhancing our publications. All By Lawyers content is kept up to date by our dedicated editorial team and our specialist authors.

Land transfer duty waiver – VIC

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The Victorian Government has announced a land transfer duty waiver for purchases of Victorian residential property with a dutiable value of up to $1 million.

For new residential properties, a 50% duty waiver applies. For existing residential properties and vacant residential land, a 25% duty waiver applies.

The applicable waiver is applied to the duty otherwise payable after all other eligible benefits, such as the first home buyer duty concession, the principal place of residence concession and the pensioner concession, have been taken into account.

The waiver can apply to the purchase of an investment property. There is no requirement to live in the property.

The waiver can be applied for more than once.

While a foreign person can obtain the waiver, it does not apply to foreign purchaser additional duty.

To be eligible for this waiver:

  • the purchase must be of residential property;
  • dutiable value must be $1 million or less;
  • the contract must be signed on or after 25 November 2020 and before 1 July 2021; and
  • the arrangement must be a bona fide purchase for adequate consideration i.e. not a gift.

The State Revenue Office will apply the waiver automatically if all eligibility criteria are met based on the information provided in the Digital Duties Form.

For further information, see the State Revenue Office page Land transfer duty waiver for residential property transactions of up to $1 million.

The By Lawyers Conveyancing – Purchase of real property (VIC) Guide has been updated accordingly.

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