ByLawyers News and Updates

Water usage rights – VIC

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New commentary on water usage rights has been added to the By Lawyers Sale and Purchase Guides (VIC).

The new content covers the right to use water and the right to participate in water share schemes in Victoria, which is governed by the Water Act 1989.

Information in relation to water use licences and water shares can be found on the DELPW Water and Catchments page. Ownership of water shares is recorded on the Water Share Register.

Note that the Registrar of Titles is also the Registrar of Water Shares.

By Lawyers do not currently offer a full commentary on the increasingly complex and valuable rights attaching to the usage, allocation and trading of water, but the new content in the Sale and Purchase Guides assists as a starting point for VIC practitioners who are called upon to advise clients in relation to the rights attaching to water in various circumstances, whether in the context of property transactions, property development, or stand-alone water trading transactions.

Helpful interactive links are also provided in the new content to allow users to quickly access the detailed information available on the Department of Environment, Land, Water and Planning website.

Variation of contract – Conveyancing QLD

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A new precedent Deed of variation of contract has been added to the By Lawyers Conveyancing Sale and Purchase guides for Queensland within folder B. CONTRACT > IF REQUIRED – DEED OF VARIATION OF CONTRACT.

The deed is in line with Public Ruling DA501.1.1 which sets out the Commissioner of State Revenue’s practice in relation to the variation of the purchase price or, another essential element, of an agreement for the transfer of land.

The public ruling provides for the terms of an agreement to be varied, including for a reduction in the purchase price, by deed and states that the agreement must be read in accordance with the provisions of the deed of variation. This process is in accordance with common law principles and will be acceptable to the Commissioner for the purposes of assessment of transfer duty. Any assessment of transfer duty based on a formally varied agreement will be made having regard to the terms of the formal amendments indicated by the parties in the deed.

This precedent was added in response to feedback from a By Lawyers user.

Water access rights – NSW

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A new chapter on water access rights has been added to the By Lawyers Reference Guide 1001 Conveyancing Answers (NSW).

The new content covers water access rights via licences (WAL’s) issued under the Water Management Act 2000, which are required to extract water from rivers or aquifers to use for irrigation, industrial or commercial purposes.

Note that WaterNSW is responsible for issuing water access licences.

By Lawyers do not currently offer a full commentary on the increasingly complex and valuable rights attaching to the usage, allocation and trading of water, but the new content in 1001 Conveyancing Answers assists as a starting point for NSW practitioners who are called upon to advise clients in relation to the rights attaching to water in various circumstances, whether in the context of property transactions, property development, or stand-alone water trading transactions.

Helpful interactive links are also provided in the new content to allow users to quickly access the detailed information available on the WaterNSW website.

Water rights – QLD

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A new chapter on water rights has been added to the By Lawyers reference guide 1001 Conveyancing Answers for Queensland.

The new content covers water allocations, water licences, overland flow, water trading and searching the register. Note that the Registrar of Land Titles is also the Registrar of Water Allocations.

By Lawyers do not currently offer a full commentary on the increasingly complex and valuable rights attaching to the usage, allocation  and trading of water, but the new content in 1001 Conveyancing Answers assists as a starting point for Queensland practitioners who are called upon to advise clients in relation to the rights attaching to water in various circumstances, whether in the context of property transactions, property development, or stand-alone water trading transactions.

Helpful interactive links are also provided in the new content to allow users to quickly access the detailed information available on the Business Queensland website.

For LEAP users, the new matter types now available in Queensland for Rural Law/Agribusiness, which include Water licences and Water allocations, contain all relevant Land Registry forms relating to water rights. These new matter types are available via Other Areas of Law in the Browse tab from within any LEAP matter.

Sale by agent – Conveyancing – TAS

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A new precedent letter for the circumstances of a sale by agent has been added to the Purchase matter plan in the By Lawyers Conveyancing (TAS) publication.

The ‘Initial letter to purchaser – Sale by agent’ is intended to be used in circumstances where, by the time the lawyer is instructed, the contract has already been exchanged by the estate agent and is binding on the parties.

The letter covers pertinent details such as finance, insurance, transfer duty and the settlement process.

This new letter was added as a result of a request from a subscriber in Hobart.

We value and encourage user feedback, so don’t hesitate to get in touch. We love to hear suggestions from our subscribers about how to enhance our content.

Complex transactions – Conveyancing – VIC

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Land Use Victoria has mandated that complex transactions for land transfers, currently managed via paper settlement, must be lodged and managed online from 1 August 2019. To meet this requirement, enhancements are being made to Duties Online. These enhancements are scheduled to take effect from 17 June 2019.

This new mandatory requirement applies to solicitors and licensed conveyancers acting for a party or for themselves, as well as PEXA subscribers. Examples include a case comprising withdrawal of a caveat, discharge of a mortgage and transfer and mortgage.

This move to require complex transactions to be managed exclusively via electronic conveyancing means:

  • The Digital Duties Form is mandatory for all transactions.
  • Duties Online (DOL) transaction types listed on the SRO website must be processed electronically using an electronic lodgement network operator.

As a result of this requirement, almost 100 per cent of transactions will now be managed online.

For further information, see the SRO Duties Online page.

See the By Lawyers Conveyancing & Property (VIC) publications for further information about electronic conveyancing and duties requirements.

Nomination and the Australian Consumer Law

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By Russell Cocks, Solicitor

First published in the Law Institute Journal
Is the Australian Consumer Law (ACL) relevant to the contractual right to nominate?

This column has considered the purchaser’s right to nominate an additional or substitute transferee on a number of occasions in the past and has also considered the impact of the ACL on residential conveyancing, which is essentially a consumer transaction. This month’s column specifically considers the application of the ACL to the purchaser’s right to nominate.

Nomination

Conventionally, contracts for the sale of land in Victoria include a condition giving the purchaser the right to nominate. General Condition 18 of the Law Institute contract expresses that right in very general terms, without limitation in relation to the form of nomination or time for nomination. Parties are free to negotiate the terms of their agreement and so the parties may, by Special Condition, ‘agree’ to a more limited right to nominate, including limitations as to the nominee, time for nomination and form of nomination.

A nomination by the purchaser creates a second contract, between the purchaser and nominee, but this is NOT a contract for the sale of land, rather it is an assignment of the purchaser’s rights under the contract of sale of land to the nominee. Traditionally, this is a doc-lite contract in that the rights and obligations of the parties are succinctly recorded with no written agreement as to what is to happen if either party does not wish to proceed with the nomination. It is essentially an assignment of the purchaser’s rights to the nominee, a legal relationship recognised by s.134 Property Law Act. Consideration for this contract may be found in the release of the purchaser from obligations under the contract of sale of land and the assumption by the nominee of rights under that contract. Importantly, the vendor is NOT a party to such a nomination or assignment and the vendor remains entitled to enforce the contract against the named purchaser. The nomination acts as the purchaser’s authority to the vendor to transfer the property to the nominee in fulfillment of the vendor’s duties under the contract.

The contractual right to nominate is an important ‘escape hatch’ for a purchaser who finds that, due to changed circumstances, the purchaser is not able to complete the contract. This is particularly so in an off-the-plan environment where the contract contemplates an extended contract period during which time the purchaser is exposed to changing circumstances.

Australian Consumer Law

The ACL is designed to protect consumers. A purchaser in a residential contract of sale of land is a consumer for this purpose.

Section 20 proscribes “unconscionable conduct” which is an equitable concept developed by the Courts in cases commencing with Amadio in 1983 and which continues to develop to changing circumstances. Conduct will be unconscionable if one party to a contract is at a “special disadvantage” and the other party “takes advantage” of that situation. Some purchaser in residential contracts may satisfy this test but inequality of bargaining power alone may not be sufficient to establish unconscionable conduct.

Section 23 proscribes “unfair contract terms” in standard form consumer contracts. Factors to be considered in determining whether terms are unfair are:

  • inequality of bargaining power;
  • whether the contract is prepared in anticipation of the transaction, rather than in response to the transaction; and
  • whether the other party had a real ability to negotiate the terms.

Contracts for the sale of land are created as “standard form contracts”. Certainly, the parties are free to negotiate amendment to the terms of such contracts but, in practice, this does not happen. The vendor or vendor’s agent presents the standard form contract to the consumer and it is signed, without negotiation. Various factors: such as trust, lack of knowledge and unequal bargaining power contribute to this outcome but the result is a standard form contract in the vast majority of cases. The removal of the right to nominate, or the imposition of onerous conditions in relation to nomination, are likely to be unfair terms in these circumstances and liable to be unenforceable against the purchaser.

Electronic Duties – Conveyancing NSW

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Electronic Duties Return (EDR) is a service that allows an approved person to electronically assess and endorse a range of duties transactions in NSW.

Revenue NSW has released a new Electronic Duties Return, effective from 15 April 2019. This release has introduced four new transaction types:

A new digital service called eDuties to replace paper lodgements with Revenue NSW is now available in a beta version.

The OSR Ref ID has changed its name to the Duties Assessment Number (DAN).

For further information, see the NSW Revenue EDR Update newsletter.

The By Lawyers conveyancing publications deal with online duties.

Mortgages – inaccurate certification – QLD, NSW, SA, VIC, WA

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Case law update – mortgages – inaccurate certification by ELNO subscriber

In the recent case of Perebo Pty Ltd v Wayville Residential Investments Pty Ltd & Ors [2019] SASC 35, the South Australian Supreme Court considered the effect of an inaccurate certification made by the mortgagee’s solicitor upon lodgment of a mortgage. The mortgage was held to be enforceable despite the solicitor for the mortgagee inaccurately certifying that the mortgagee held a copy of the mortgage granted by the mortgagor.

The Registrar General in each state is entitled to rely upon the certification of a subscriber to an Electronic Lodgement Network Operator (ELNO) that a mortgagee holds a mortgage granted by the mortgagor in the same terms as the instrument that is lodged. However where there is inaccurate certification, the instrument registered pursuant to the certification is not necessarily invalidated merely by that fact. The instrument will of course be invalidated if it is fraudulent, or falls within one of the other exceptions to indefeasibility.

However, while the mortgage might not be invalid, by giving an inaccurate certification, the mortgagee, or the mortgagee’s representative such as a solicitor, may face disciplinary action from the applicable regulator, or the risk of being suspended or terminated as a subscriber to the ELNO.

The By Lawyers Mortgages commentaries have been updated to include a summary of this case and a link to the full decision.

Costs disclosure – Increase of legal rates during a matter

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Increase of legal rates during a matter

All By Lawyers Costs Agreements and Client Service Agreements have been updated to include a clause notifying a client that legal rates may increase during the course of a matter requiring a revision of the costs estimate provided. This clause provides for 30 days written notice of any proposed changes to legal rates. While such a clause is not required by Legal Profession legislation concerning costs disclosure requirements, providing such notice on initial costs disclosure is considered best practice.

All of our Guides contain Costs Agreements (Client Service Agreements for QLD Guides) within the folder ‘A. Getting the mater underway’. All of our agreements are compliant with the relevant Legal Profession legislation and are reviewed and updated regularly to ensure compliance.

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