Although a rural lifestyle is an attractive option for many prospective purchasers, it is important to know that a prudent purchaser should complete additional due diligence before committing to a purchase. Rural land in Western Australia generally includes broadacre farming land, pastoral leases and large acreage holdings.
While there are many additional enquiries that a purchaser can undertake in WA, particularly in relation to rural property, we outline some of the more common below:
Under the Biosecurity and Agriculture Management Act 2007 (WA), landholders must control declared pest plants and animals such as blackberry, skeleton weed and cotton bush. Purchasers should inspect the land and make enquiries with DPIRD (Department of Primary Industries and Regional Development).
Water rights in WA are regulated by the Rights in Water and Irrigation Act 1914 (WA). Bore licences or water entitlements may need to be transferred separately. Searches can be conducted through Water Register WA.
WA rural properties may be subject to share farming agreements, pastoral subleases or agistment arrangements. These may prevent the property being sold with vacant possession. Purchasers should make enquiries with the Vendor about any occupiers or agreements.
A significant number of rural properties in WA are affected by mining or exploration licences under the Mining Act 1978 (WA) or petroleum legislation. Searches with the Department of Mines, Industry Regulation and Safety (DMIRS) will reveal whether the land is subject to tenements or applications.
WA rural land may be affected by residues from past cropping or livestock operations. Purchasers should inspect the property for contamination sites such as chemical sheds, fuel areas, dip sites or dumps. DPIRD can advise on contamination notices.
WA has specific biosecurity regulations concerning livestock diseases (e.g. OJD, footrot) and plant pests. Clearing native vegetation requires approval under the Environmental Protection Act 1986 (WA). Purchasers intending to farm should enquire with DPIRD.
Some WA rural properties access their land via unconstructed roads, Crown roads or informal arrangements. Purchasers should investigate legal access rights through Landgate inquiries.
Planning controls for rural WA land vary by local government area. Purchasers should confirm that soil, climate and land use zoning allow for the intended agricultural use.
In addition to general council rates, some WA rural properties are subject to emergency services levies or biosecurity group rates.
WA rural properties often rely on septic systems or ATUs. These systems must comply with Department of Health WA guidelines.
As the vendor is not necessarily required to disclose this information, thorough due diligence with assistance from a Perth conveyancing solicitor is recommended for WA rural purchasers.
Although a rural lifestyle is an attractive option for many prospective purchasers, it is important to know that a prudent purchaser should complete additional due diligence prior to committing to purchasing. Rural land in the ACT consists largely of long-term rural leases rather than freehold land.
While there are many additional enquiries that a purchaser can undertake in the ACT, particularly regarding rural leases, we outline some of the more common below:
In the ACT, responsibility for controlling declared pests arises under the Pest Plants and Animals Act 2005 (ACT). Landholders must control declared weeds such as serrated tussock, African lovegrass and blackberry. Purchasers should inspect the land and make enquiries with ACT Environment, Planning and Sustainable Development Directorate.
Water access entitlements in the ACT operate under the Water Resources Act 2007 (ACT). Any water access entitlements must be transferred separately from land. Your solicitor can search ACT registers for associated water entitlements.
ACT rural land is usually subject to long-term Crown rural leases. Many agistment or grazing arrangements on ACT rural leases remain informal. Rural land purchasers should request full details of any occupants or users of the land.
The ACT does not have significant mining activities, but purchasers should still enquire whether any licences or easements affect the property, including Commonwealth interests.
Some ACT rural leases have historical agricultural use that may have resulted in contamination from pesticides or chemicals. Purchasers should inspect the Property for potential contamination and may obtain reports from ACT Environment Protection Authority.
Livestock health and biosecurity matters are regulated by the ACT Biosecurity Division. Native vegetation clearing or disturbance may require approval under the Planning and Development Act 2007 (ACT). Purchasers intending to farm should make appropriate enquiries.
Some ACT rural properties rely on access rights over Territory land or private easements. Purchasers should verify the legal access arrangements.
The rural lease structure in the ACT requires approval for certain agricultural or horticultural activities. Purchasers should enquire with ACT Planning to confirm usage rights and restrictions under the relevant Crown lease.
ACT rural leases are subject to general rates, water charges and potentially separate fire or land management charges.
Rural ACT properties may use on-site sewage systems, which must comply with ACT Health requirements.
As the ACT vendor disclosure regime differs from freehold jurisdictions, purchasers must conduct thorough due diligence with their Canberra conveyancing solicitor.
Although a rural lifestyle is an attractive option for many prospective purchasers, it is important to know that a prudent purchaser should complete additional due diligence on the property prior to committing to purchasing it. Rural land in Queensland is generally classified as large acreage land suitable for agricultural, grazing or pastoral use.
While there are a large number of additional enquiries that a purchaser can undertake in Queensland, particularly in relation to rural property, we hope to provide a brief outline of some of the more common below:
Responsibility for declared pests, weeds and invasive plants in Queensland arises under the Biosecurity Act 2014 (Qld). Landholders must take reasonable steps to control specified weeds such as prickly acacia, parthenium and giant rat’s tail grass. Purchasers should inspect the land for weeds and make enquiries with the Vendor or Biosecurity Queensland about any problems. Local councils may issue biosecurity orders requiring weed control works at the expense of the owner.
The Property may also have water allocations or water licences associated with it under the Water Act 2000 (Qld). These must be transferred separately from the title to the Property. A solicitor or conveyancer will be able to search the Water Allocations Register to confirm whether any water entitlements need to be transferred.
Many share farming/lease agreements are oral and deemed to be periodic tenancies. Land may also be leased out for grazing under agistment arrangements. Agricultural tenancies can be complex and may prevent the property from being sold with vacant possession. We recommend specific enquiries with the Vendor to determine whether there is an occupier or lessee using the land.
Rural land may be subject to mining or exploration permits under the Mineral Resources Act 1989 (Qld) or Petroleum and Gas (Production and Safety) Act 2004 (Qld). Purchasers can conduct searches to identify any exploration permits, mining leases or applications affecting the property.
Rural land may be impacted by chemical residues from past agricultural use. We recommend that prospective purchasers inspect the Property for evidence of possible contamination, such as pesticide storage sheds, fuel areas or dip sites. Biosecurity Queensland or the local council may provide advice on contamination notices or orders.
Queensland rural land can be affected by livestock diseases (such as cattle tick) and plant pests. Native vegetation clearing may require approval under the Vegetation Management Act 1999 (Qld). Purchasers intending to farm should make enquiries with the Vendor or Department of Agriculture and Fisheries.
Although a Contract may show that there is a road providing access to the Property, in practice the road may not be accessible or may be a gazetted but unformed road, or a private access arrangement. Some rural properties also rely on stock routes or easements. It is important to identify how access is legally obtained.
Agricultural suitability may depend on water availability, soil quality, climate and vegetation. Purchasers intending to work the land should enquire with the local council to ensure the land is suitable for the intended purpose.
In addition to general council rates and water charges, certain rural properties may incur charges under Queensland’s rural fire levy or biosecurity levies.
A rural property may not be connected to town sewerage. On-site sewage treatment systems must comply with Queensland Plumbing and Wastewater Codes.
As the vendor is not necessarily required to disclose the above information in the Contract for Sale, we strongly recommend that prospective purchasers of rural properties take the time to investigate them with the assistance of a Brisbane conveyancing solicitor to ensure that the property will be suitable for their needs.
When buying an ACT residential property, it is common to encounter structures which require a form of approval, but have not been approved by the planning authorities (unapproved structures). Usually, Sellers will require the Buyer to take the property ‘as is’ – with all defects and unapproved structures (if any). While Buyers can try to negotiate on this point, most Sellers insist on the property being sold with the unapproved structures disclosed.
It is important to note, however, that under the contract, the seller must disclose all unapproved structures otherwise the Buyer may require the Seller to obtain the approval before Completion, and if the approval is not obtained before Completion, the Buyer may rescind the contract, or complete the contract and sue the Seller.
The significance of accepting an unapproved structure is twofold. First, the Buyer runs the risk of the planning authorities issuing a rectification order, requiring the Buyer to alter or remove the unapproved structure. Second, insurers may be reluctant to cover any claims that arise out of an unapproved structure. For example, if a Buyer purchased a property with an unapproved fireplace and the property burns down because of the unapproved fireplace, the Buyer may have issues trying to claim on the policy.
Given these risks, we recommend Buyers review any inspection report contained in the contract which identifies unapproved structures and make further enquires with the relevant authorities.
In NSW there is no requirement for a vendor to provide the purchaser with a compliance report. It is important the purchaser completes their due diligence and obtains compliance information from the local council.
More information on unapproved structures in the ACT can be found on the planning website:
General Information: https://www.planning.act.gov.au/build-buy-renovate/build-buy-or-renovate/before-you-start/do-i-need-approval
Checklists: https://www.planning.act.gov.au/build-buy-renovate/build-buy-or-renovate/building-101/checklists
If you are seeking for legal advice, our Property Law specialists team can help you. Get in touch today!
With the recent news of developers rescinding (cancelling) off-the-plan contracts here in the ACT, the Government is contemplating amendments to laws to limit the ability of developers to rescind contracts.
It is worth considering the position in NSW as a point of reference.
Section 66ZS of the Conveyancing Act 1919 (NSW) governs rescission of contracts if requirements have not been completed by the Sunset Date.
Section 66ZS(3) provides:
A vendor may rescind an off the plan contract under a sunset clause, but only if
The Supreme Court may permit a vendor to rescind contracts under s66ZS(3)(b) if the court is convinced that making the order is ‘just and equitable’ in all circumstances.
In considering whether an order is ‘just and equitable’, the Court considers the following factors in Section 66ZS(7):
Most importantly, section 66ZS(5) invalidates any automatic rescission clauses in off the plan contracts. Instead, developers are required to comply with the provisions of Section 66ZS.
In particular, the existence of Section 66ZS(3)(b) prevents developers from exercising their rescission clauses unless they demonstrate to the Court that the proposed rescission was ‘just and equitable’ in the circumstances.
The legislation in NSW has counterbalanced the powerful position that developers often have with respect to the typical purchaser and rescissions.
Reach out to our conveyancing team for any legal questions.
To continue our last article on Rules, we will now delve deeper into special privilege rights. Special privilege rights may, at first, appear to be an alien concept. To understand why they are required, you first need to know that a units plan is divided into personal and common property. Personal property is owned directly by the unit or lot owner – for example, the interior of your apartment, car parking space and storage areas. Common property is collectively owned by the Owners Corporation, being the entity that amalgamates all of the owners in the units plan. Common property must be cared for and insured by the Owners Corporation, and may include pool areas, common gardens or other communal facilities.
What is a special privilege rule?
In the ACT, a special privilege right can be granted by the Owners Corporation pursuant to Section 22 of the Unit Titles (Management) Act 2011 (ACT) to establish an ‘exclusive use right’ over the common property. It is generally granted in favour of a particular unit owner or class of unit owners. You may also come across the terms ‘exclusive use by-law’ or ‘special privilege by-law’, which are used in NSW. In addition to providing a specific unit owner or class of unit owners with the exclusive use right, the special privilege rule can also provide that the party who is benefiting from the exclusive access will meet the costs of maintaining that area of the common property.
To provide an example, in a mixed-use building containing ground floor commercial shops or restaurants with residential units above, it would be possible to create a special privilege rule which would grant the commercial units exclusive use over the ground floor toilets. In this scenario, the residential unit owners will no longer be permitted to access these facilities, but they will also not be required to paid for them. The cost of cleaning and maintain the toilets (and stipulations around when that must occur) can be included in the special privilege rule. This means that these costs can be levied exclusively to the commercial units.
Taking that same example further, there may be other facilities in the building (including a pool or gym area) which can be exclusively set aside for use by the residential unit owners with the associated costs and maintenance obligations. This means that the commercial unit owners will not be required to pay for these facilities which they would not obtain the benefit of in any event.
A special privilege rule is essentially one of the best mechanisms available to an Owners Corporation to codify a ‘user-pays’ system, which can be tailored to take in to account the nuances of that unique complex. As the special privilege rule will be included in the consolidated set of rules for the Owners Corporation when they are granted for a period of 3 months or more (which must also be registered over the legal title), it will also be easier for incoming owners to identify whether there are any active special privilege rights and whether they have been granted in favour of the unit that they propose to purchase.
Are there any limitations on what a special privilege right can do?
As noted above, a special privilege right must contain a maintenance obligation for the benefited owner or class of owners, including:
A special privilege right can also not be granted without obtaining the consent of the benefited owner or class of owners. While these owners cannot unreasonably withhold their consent to the granting of the special privilege right, this protects unit owners from having a special privilege and the associated maintenance obligations imposed upon them by the Owners Corporation.
A unit owner or Owners Corporation may also apply to ACAT in the event of a dispute around a special privilege rule. An Owners Corporation may argue that the grantee has unreasonably withheld consent to creating or amending a special privilege rule, while a unit owner may seek an order that the Owners Corporation has unreasonably refused to make, amend or revoke a special privilege rule or has imposed unreasonably maintenance obligations on the grantee.
As noted in our Alternative Rules article, an alternative rule (including a special privilege rule) must also not be inconsistent with any Act or law, be incompatible with a human right or otherwise by harsh, unconscionable or oppressive.
Can property developers create special privilege rules?
The previous policy position was that developers were unable to amend the Default Rules of the Owners Corporation prior to the end of the ‘developer control period’ – that is, until the developer was no longer the main stakeholder in the complex.
Now, a developer will have the ability to create a bespoke set of Alternative Rules prior to the registration of the units plan, provided that the proposed Alternative Rules have been disclosed appropriately in the Contract for Sale. This allows a developer to consider the specific needs of their development and creates an opportunity to curate the experience of the Owners Corporation in relation to access and maintenance of common property while providing a fair apportionment of costs. A developer can also improve the general understanding of their project by prospective purchasers by providing a clear outline of how the complex will operate, what shared facilities may exist and which user groups will be entitled to access them.
Should you require further advice on special privilege rules, either for your established Owners Corporation or your new development, please contact our Property Law specialists team for further information.
Although a rural lifestyle is an attractive option for many prospective purchasers, it is important to know that a prudent purchaser should complete additional due diligence on the property prior to committing to purchasing it. Rural land is classified as any lot that exceeds 2.5 hectares or 6.2 acres, whether or not the land has previously been used for agricultural purposes.
While there are a large number of additional enquiries that a purchaser can undertake in NSW, particularly in relation to rural property, we hope to provide a brief outline of some of the more common below:
The Noxious Weeds Act 1993 (NSW) makes the occupier of land responsible for the control of specified weeds such as blackberry, serrated tussock and Bathurst burr which can all spread and cause problems for neighbouring land holders. Purchasers should inspect the land for weeds and make enquiries with the Vendor or Local Land Services about any weed problems. The local council may issue a notice to a property owner requiring them to carry out weed control works at the expense of the owner, so a purchaser will want to ensure that such a notice has not issued as it will also be binding on them in the future.
The Property may also have a water access licence (WAL) associated with it for the use of dams or bores. A WAL must be transferred to a Purchaser separately from the title to the Property. A solicitor or conveyancer will be able to search the register to identify whether any WAL need to be transferred with the property.
Many share farming/lease agreements are oral and deemed to be a periodic tenancy from year to year. Land may also be leased out to farmers under agistment agreements that permit stock, cattle or horses to graze. Agricultural tenancies can be a complex area for rural land purchasers and may prevent the property from being sold with vacant possession. We recommend that specific enquiries are made with the Vendor to determine whether there is a sharefarmer or lessee using the land.
Rural land may be subject to mining and mineral exploration titles or application under the Mining Act 1992 (NSW) or the Petroleum (Onshore) Act 1991 (NSW). Purchasers or their solicitors can apply to the Mine Subsidence Board for a certificate to confirm whether the land is within the Mine Subsidence District.
Rural land that has been used for production purposes can often be impacted by chemical residues in animal and plant products. The residues of major concern to land purchasers can persist in soil for long periods and impact on the marketability of the property. We recommend that prospective purchasers inspect the Property for evidence of potential sites of residual contamination, such as pesticide storage sheds, diesel and fuel storage areas, dip sites or rubbish dumps etc. The Local Land Services can advise whether the Property is impacted by any current orders, notices or undertakings under the Act. They will generally release this information to purchasers with consent from the vendor.
Some livestock diseases can persist on contaminated land even after the stock has been removed from the property, as can some soil-borne pests. Native vegetation may also prove to be an issue for prospective purchasers, as it may not be capable of being cleared without development approval. Rural land purchasers who intend on operating a horticultural enterprise or keeping stock on the land should make enquiries in this respect with the Vendor or Local Land Services.
Although a Contract may show that there is a road providing access to the Property, in practicality this road may no longer be accessible. The previous owners may have put arrangements in place with neighbours to ensure access, or the property may only be accessible by a ‘crown road’, being a road owned by the NSW Government. The current owner may be paying rent for the use of the crown road. For these reasons, it is important to identify how access to the Property is obtained and whether you are protected in this respect.
There are many features of agricultural land which may not be governed by legislation but can significantly affect the land’s suitability – such as the climate, soils, water availability and natural vegetation. If a purchaser intends to work the land or use it for a specific purpose, we recommend enquiries are made with the local council prior to exchange to determine the suitability of the land for that particular purpose. A purchaser should also ensure that they have the opportunity to thoroughly inspect the property prior to exchange so that they can be assured that the land will accommodate their crops or livestock.
In addition to standard general rates charged by local council (and water usage charges should the property be connected to reticulated council water), a property may also be charged local land services rates where it is over 10 hectares. Local Land Service Rates are used to provide services to landowners.
A rural property may not be connected to a council sewer main, meaning that it must have an alternative form of waste disposal. An on-site sewerage management system (OSSMS) will have particular compliance and operational standards depending on the local council’s guidelines. Your solicitor or conveyancer will be able to provide further information in this respect.
As the vendor is not necessarily required to disclose the above information in the Contract for Sale, we strongly recommend that prospective purchasers of rural properties take the time to investigate them with the assistance of their solicitor to ensure that the property will be suitable for their needs. To obtain further advice on purchasing rural property, please contact our Sydney conveyancing or Newcastle conveyancing team.
Last year the ACT government introduced legislation which will permit settlements to be conducted through an online electronic conveyancing solution, such as PEXA. The first electronic conveyance is likely to be completed towards the end of the year starting a dramatic shift in how practitioners in the ACT complete settlements.
Currently, the ACT conducts physical settlements in which all parties to the transaction (incoming and outgoing banks, seller solicitor and buyer solicitor) attend in person to complete the transaction. The buyer solicitor will organise for bank cheques to be drawn on the morning of settlement and handed to the seller solicitor in return for title to the Property.
The process means that there is potential for settlements to be delayed. On rare occasions one of the parties might be unable to attend, or the settlement figures need to be adjusted at the last minute. This can mean the settlement needs to be postponed by at least a day. This is often at the expense of the client.
The electronic settlement platform will significantly minimise the chance of these issues arising. The PEXA platform means there is no physical settlement, no bank cheques are required, and any last minute adjustments can easily be balanced in the hours and minutes leading up to the settlement.
In addition, PEXA has electronic transfers allowing clients to receive their sale proceeds faster. Normally a bank cheque is collected on settlement. The bank cheque is often unable to be banked until the next business day, and there is 3-5 day wait until the money clears in the client’s account. After a PEXA based settlement, the funds are transferred immediately, meaning the client can receive their funds within 24 hours from the settlement.
Chamberlains already conduct all NSW transactions through the PEXA platform and we are ready and excited to be conducting ACT transaction through PEXA shortly.
PEXA is an exciting and positive step forward for conveyancing in the ACT which will benefit practitioner and clients alike.
To obtain further legal advice, please contact our property law specialist team.
Buying a property is perhaps one of the biggest and most exciting decisions you can make. One of the most common questions we are asked by home buyers is whether they should buy an off the plan unit or an established residence.
At Chamberlains we help explain the legalities involved in each type of purchase and the advantages and disadvantages so that you can decide which type of property best suits your budget and your needs.
Off the plan
Buying ‘off the plan’ is the process of entering into a contract to purchase a property, usually a unit, even though the unit has not yet been built. You are required to pay a deposit on exchange of contracts and then the balance of the purchase price is paid once construction has finished.
The main disadvantage is that a buyer does not see the finished product before entering into the contract. There may also be delays in construction times and sometimes the developer can make to make minor changes to the layout of the unit.
One of the main benefits of purchasing an OTP property is the potential Home Buyer Assistance available. Home Buyer Assistance is geared towards new construction in the ACT. Provided the contract price is within the relevant thresholds, an owner-occupier is entitled to a concession on the stamp duty payable. Further, most new units also come with a 90 day defect warranty. There may also be other benefits in a financial sense, such as having time to save money before settlement and in some cases an increase in property value between the date of exchange and settlement.
Established Property
Buying an established property is more straightforward. A buyer can plan around a more reliable settlement date, but more importantly, the buyer can inspect the property before exchanging contracts. As a rule of thumb, what you see is what you get. A buyer can thoroughly inspect the property and be fully aware of what they are getting in to.
Although there is Home Buyer Assistance in the form of a stamp duty concession, the concession is means tested and asset tested.
What’s the better choice?
Both options will appeal to different people. We find a lot of clients tend to use the Home Buyer Assistance and current market conditions as the decisive factor when purchasing an off the plan property. On the other hand, some clients will prefer a property they can actually inspect before committing to the purchase.
The decision is ultimately up to each buyer, but we strongly recommend discussing the implications that will apply in your personal circumstances. If you, or somebody you know, are looking to purchase their first property, give our Property Law specialists team a call to discuss.
As property lawyers, we spend a great deal of time considering questions of ownership, title and interest. When buying a business from someone, you may not be buying any particular thing, such as shares in a company, or title to a house.
When buying a business, you are instead purchasing a ‘bundle of rights’ from the current business-owner.
Some of the things that make up a business are property, such as equipment, stock, money left over in accounts and maybe even a lease or title to a shop. Other rights are more intangible: intellectual property, goodwill, debts, and business names.
Because there is no single piece of property, it is important to make sure that when you buy a business, the contract covers all of the rights and property associated with that business.
It is no good buying a café if you don’t have the right to use its name and reputation or buying a car repair shop if you don’t have the right to chase after debts owing from before you took over.
If the business is a franchise, it is even more important to ensure that you are allowed by the franchisor to continue using their brand in accordance with the franchise agreement, and it is important that you understand and view the terms of that agreement before buying the business.
You should also remember that in some jurisdictions, buying a business does not require a formal contract, and even a string of emails could mean you are contractually obligated to go through with the purchase.
If you are unsure, seek legal advice from our property lawyers before entering formal negotiations.