Selling your home is known as being a highly stressful time in a person’s life. Dealing with factors such as emotional attachment to the property, high financial stakes, and thinking about what repairs need to be made before you should even put your property on the market can be very overwhelming – often leading you to forget important requirements and even overlook the liability you hold as a seller.
On the contrary, buying a home also comes with several risks. Unforeseen structural damage or defects, legal and regulatory compliance, and contracts unexpectedly falling through are all details you need to be aware of before you sign that contract and go unconditional.
The new Seller Disclosure Scheme established under Queensland’s new Property Law Act 2023 (Qld) means that sellers are now required to prepare a ‘Seller Disclosure Statement’ based on specific searches conducted on their property, and a ‘Contract and Property Report’ which explains the results of those searches in detail.
The new Seller Disclosure Statement requires sellers to provide the buyer with the following:
– Current title search;
– Unregistered encumbrances, easements, or caveats;
– Zoning and planning restrictions;
– Rates and water charges;
– Flood history and past disputes; and
– Any other facts that might influence a buyer’s decision.
The Seller Disclosure Statement aids in relieving the above-mentioned concerns and provides multiple benefits for both parties.
Benefits for sellers:
– Reduces the risk of contract termination, litigation and financial loss; and
– Increases trust and transparency with potential buyers.
Benefits for buyers:
– Right to terminate contract up until settlement date if the seller does not provide the Seller Disclosure Form; and
– It is now the seller’s responsibility to conduct the appropriate searches and disclose any critical details (no more “Buyer Beware”).
By disclosing information early, it allows for the buyer to come to an informed decision about whether they would like to proceed with the contract -rather than signing the contract prematurely and discovering issues later during the conveyance. However, our clients can rest assured knowing that the new Seller Disclosure Statement requirements protect both sides of the conveyance, and that our team can assist with ensuring their purchase or sale goes smoothly.
Olympia Kemp-Upton, Conveyancing Assistant at Zande Law Solicitors, Suite 9, Norwinn Centre, 15 Discovery Drive, North Lakes, is the author of this article, training in the area of Conveyancing.
The information in this article is merely a guide and is not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
Significant changes are coming to Family Law which will affect separating couples in a variety of ways. While some of the amendments are unlikely to make a major difference in settlements, the headline-grabbing change is that the Court must explicitly consider and take into account the effect of any family violence when dividing assets or making orders for spousal maintenance.
The effect of this change is expected by some to be significant and will be taken into account when the Court evaluates everyone’s contributions to the relationship and when the Court considers the effect any violence has had on someone’s current and future ability to earn an income. Potentially, survivors of family violence will see their overall share of the combined assets increased in multiple ways due to this new law.
The effect of this could be wide-ranging given that the recent statistics show that more than 80% of cases in litigation involve allegations of violence by at least one person.
Some other amendments that are likely to be more relevant for the majority of separating couples include:
Considerations of how liabilities are incurred;
The effect of wasting formerly-owned assets;
The need of either party to provide appropriate housing for children;
Making attendance at straight forward divorce hearings optional for everyone; and
Enabling the Court to make orders in relation to the family pet, such as, that one person have sole ownership, that the animal be transferred by consent to another person or for it to be sold.
A lot of the changes commence 10 June 2025 but some of the amendments will apply to proceedings already underway but not yet finalised. Given the significance of these changes, anyone going through a separation should consider getting specific advice as to how their settlement may be affected.
Joshua Noble is an Accredited Family Law Specialist at Zande Law located at Suite 3, Jade Chambers, 15 Middle Street, Cleveland. To contact Josh for advice, please phone (07) 3385 0999 to schedule an appointment.
The information in this article is merely a guide and not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
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How does Covid-19 impact on legal services and the law
Although undoubtedly, the present restrictions on human contact and movement are having an unpresented impact upon Australia’s economic prosperity and these same factors are undoubtedly impacting also on many people from a mental health perspective. For the most part, none of these restrictions should effect the way the law or the delivery of legal services have operated and/or apply.
Family Law Cases
The Chief Justice of the Family Court has issued a public announcement that unless a particular family is actually suffering a Covid-19 infection, the Court expects that pre-existing arrangements for the share of care and decisions making for the children should continue on unaffected. The existing family law principles already are flexible enough to adapt to a world where the value of businesses, stock market investments, superannuation and/or Real Estate are undergoing dramatic fluctuations as a consequence of broad base external factors as was previously seen with events such as the property boom in the late 90’s early 2000’s and the consequent global financial crisis of 2008. Otherwise, the Family Court itself is still very much open for business and is presently running all of its cases via telephone and video link. All court documents are now being filed via the Court’s online portal, a system which has been up and running now for several years. There are some disruptions and delays, but by enlarge the court is still functioning as normal.
Buying and Selling Real Estate
Although worries over job security and the potential for a dramatic drop in real estate prices are undoubtedly impacting on confidence and the consequent willingness of parties to enter into and/or proceed to complete real estate deals, the terms of the standard REIQ real estate contracts and the overall structure of the conveyancing process are both well capable of adapting to Covid-19 issues. Under the standard REIQ contract, there are already specific clauses that will suspend the operation of a contract should events such as a Covid lockdown occur. Under those same terms, the seller is also given the right to terminate the arrangement if government restrictions are to continue for an extended period. House inspections can still legally occur and the only events which are currently not possible are the group gatherings associated with auctions and open houses. In terms of the conveyancing process, the innovation of e conveyancing which has now been in operation for some time, now permits every task of the conveyancing exercise to be conducted online with the one exception of witnessing of signatures but this task can still be easily completed in face to face meetings provided social distancing is used.
Preparation of Wills and Enduring Powers of Attorney and the administration of Deceased Estates
Although much of these tasks have historically been conducted through face to face meetings, all of the required tasks to prepare and sign a will, an enduring power of attorney or attend to the administration of a deceased estate, can be conducted via use of telephone or video conferencing and in extreme cases this too can extend the execution of wills and enduring power of attorneys documents although most law firms preference is to continue to have these documents executed in face to face meeting which are all still perfectly doable provided everybody respects social distancing and hand sanitising.
General Legal Business and Consultations
Again with the ability to conduct business via telephone or video conferencing and also via the use of email and online document sharing platforms such as drop box, the business of providing and receiving general legal services is well capable of continuing to be conducted amidst a Covid lockdown environment.
So, the message generally from Zande Law and indeed the legal industry at large is that we are still open for business and do not foresee that any developments associated with Covid-19 will impact on our ability to provide services for you.
Put and Call Options are a special type of contract commonly used by land developers. In the most typical scenario, the developer is also a home builder who will use a Put and Call Option to secure the exclusive right to buy a property from its existing owner at a set/fixed price, but with no obligation to actually complete the purchase and pay over the money for an extended period of time of say 120 days. The developer then enthusiastically sets about marketing the property for on-sale to a third party as a finished “house and land” package. If all goes to plan, the developer will have found a buyer willing to sign up to a purchase contract for the land and a simultaneous building contract for the home within the first 90 days and with the new buyer secured, the developer can then go on and safely deliver the “call” to the original land owner to commit to the sale of the land before the 120 day time limit has expired. With the timing set up in this way the developer will be using the new buyer’s money (as opposed to its own) to complete the land purchase and once the land purchase is complete, the developer can then go on and happily build the new home for a profit assuming of course the developer has done its sums right. By using a Put and Call Option device, the whole project becomes much more affordable because the developer doesn’t have to borrow and pay commercial interest rates on the land purchase whilst trying to find a buyer and, if the documentation is done right, the land transfer will occur from the original owner directly to the third party house and land buyer, thus cutting out the developer as the middleman and saving the payment of double stamp duty in the process. Put and Call Options can and often are also used for other situations, such as a developer buying a larger parent block with the intent to subdivide and sell off smaller blocks for profit, but in those scenarios, usually paying the double stamp duty is going to be unavoidable.
Michael Zande is the Principal of Zande Law Solicitors, with 30 years’ experience in practice. Michael and his team have had extensive experience in conveyancing matters. Please feel free to review our firm and staff profiles at www.zandelaw.com.au
The information in this article is merely a guide and is not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
A retaining wall is a structure designed to hold up an embankment of soil which has been artificially created following either the cutting and excavation or back filling of a sloped allotment of land. In most cases the earthworks are performed to create a more usable level platform of soil for building construction. However, given the fact that these works may have an impact on any neighbouring property, what are the rules around the design, positioning and maintenance of these structures?
Generally, the wall will be positioned inside the boundary line of the property that benefits from it and consequently, it usually follows that the cost of construction and maintaining the wall will always be the full responsibility of the owner of that property from time to time.
Local Council approval for the structure is usually not required unless the wall either, rises above 1 meter or is positioned within 1.5 meters of a building structure and/or directly along a boundary line with a neighbouring property.
If neighbours fall into dispute over the construction and/or maintenance of a retaining wall positioned on a boundary line between their properties, the dispute generally cannot be managed under the relatively simple Qld dividing fences laws* and is instead resolved under an old legal principle known as the law against nuisance. This same law also covers a situation where the wall is wholly located inside the boundary of one property but now poses as a landslide threat to the neighbouring property through poor design or disrepair of the wall.
In each case, this anti nuisance law apportions the liability for the wall in the same proportion that the wall supports the excavation and/or filling which has occurred on either side of the wall structure. For example, where a one meter wall between property A and property B supports a soil fill on property A to a height of 300 mm and an excavated fall in property B to a depth of 700 mm, the cost of the wall will be shared as to 30% for A and 70% for B.
Some local Councils maintain records of the original topography of sections of land prior to subdivisions and cut/fill earthworks. If these records are not available, Consultant Engineers can be engaged to make the calculations.
*See section 35 (1)(f) of the Neighbourhood Disputes Resolution Act 2011 for limited circumstances where QCAT still has jurisdiction
Michael Zande is the Principal of Zande Law Solicitors, with 25 years’ experience in practice. Michael and his team have had extensive experience in conveyancing matters. Please feel free to review our firm and staff profiles at www.zandelaw.com.au
The information in this article is merely a guide and is not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
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THE CONVEYANCING PROCESS FOR BUYERS
Conveyancing (that is transferring) land in Queensland is a process that actually differs significantly from the practices conducted in other States of Australia, such as New South Wales and Victoria and dramatically from the process followed in other foreign countries like the United Kingdom.
Under Queensland legislation, the professional service to assist a Buyer or a Seller in the conveyance process can only be done for a fee by a law firm or other organisation which has a practicing Lawyer as its nominee for professional indemnity insurance purposes.
Some important features of a standard contract are:
A standard contract term in Queensland requires a conveyance within 30 days with conditions such as finance and building and pest to be complied with in 14 days. These timetables are doable but require swift action and co-operation if they are to be met.
The standard contract states that “time is to be of the essence”. This means that any deadlines contained in the contract are critical and if not completed will give the innocent party rights of termination commonly also with the right to demand compensation.
If a Buyer defaults, compensation for a Seller typically involves:
forfeiture of the deposit – note agents are entitled to claim commission against this;
recovery of the difference between the contract price and any price at which the property is subsequently sold (if lower) provided reasonable efforts on resale are made.
It is important to note that Contracts in Queensland are routinely prepared by licensed Real Estate Agents without assistance or intervention from a Solicitor and are only delivered to the Solicitor after the Contracts are signed by both parties. If the client wishes to receive legal advice upon the Contract before committing to it, it is critical that the Contract be provided to the Solicitor for advice before it is signed.
Otherwise the Solicitor is usually named on the contract and receives a copy of the contract direct from the Agent once signed.
Under Queensland law a Buyer is afforded a cooling off period of 5 business days from date of signing contract within which the Buyer can terminate and walk away from the deal. There is however, a penalty of 0.25% of the contract price.
The conveyancing process for a Buyer falls into a number of distinct tasks:
Step 1 – Review of Contract and advice on its terms:
Usually, the Solicitor will send out to the client an introductory letter which summarises the salient points of the contract which are typically:
the settlement date;
the deadline for completion of any conditions such as the obtaining of finance or a satisfactory building and pest report and/or the payment of the balance of a split deposit.
The introductory letter will normally have a client questionnaire to be completed by which the client confirms their names and contact details, their intentions concerning occupancy of the property, searches that they wish to perform or not perform and the timing for delivery of those searches. That letter will also contain an authority to act form that must be signed and returned or the Solicitor cannot act.
Step 2 – Satisfying Special Conditions:
The Solicitor will need to monitor and clear off of the contract’s special conditions such as:
the obtaining of finance approval; and
satisfactory building and pest report; and
any other special conditions.
The Lawyers keep “bring up” diaries which prompt them to chase clients for the answers to these conditions if not communicated however, ultimately the Buyer must take responsibility for satisfying the condition or suffering the consequences of termination of the contract.
In working through these special conditions it is important to note the Buyer is responsible to seek out and engage their own chosen financier/contractor although some Solicitors maintain referral lists for these service providers.
Step 3 – Conduct of Searches:
The Solicitor performs searches which are intended to confirm that free and clear title to the property can be conveyed to the Buyer so that the Buyer obtains outright ownership and rights of enjoyment and use within the restrictions of the “present use” described in the contract or otherwise relevant Council’s zoning. If the searches reveal any impediments on the property (for example, an easement or other liability to a third party that would pass with the property or a right given to a third party to make some use of the property) then the discovery of these issues may entitle the Buyer to terminate the contract with full deposit refund, the right to demand that the Seller remove the impediment before or at settlement and/or the right to demand financial compensation.
The cost of the searches vary depending upon the relevant authorities. Generally speaking though they pitch in the range of $850.00 for a dwelling or unimproved land.
On receipt of the searches, the Solicitor is then able to calculate the final settlement price. Adjustments are made in the purchase price to, for example, ensure that the Seller’s responsibility for payment of council rates up to the day of settlement and/or land tax are met. This is important because these liabilities stay with the land and consequently pass to the Buyer after settlement if not paid.
At about this point, the Buyer’s Solicitor should lodge a Settlement Notice with the Queensland Department of Natural Resources. This notifies any persons who might seek to take an interest in the property that the property is presently under contract for sale and protects the Buyer from the Seller attempting to give some other interest in the property to another person.
Step 4 – Preparation of Transfer Documents:
Transfer documents are technical forms that must be completed in strict compliance with regulation and the Buyers’ names as they appear on the contract. Failure to do this will result in a number of serious problems including a liability for double the cost in stamp duty, settlement being unable to be completed due to rejection of the transfer document by the Buyer’s Financier and/or the inability to actually become registered on the Title Deed even though the full purchase price has been paid over to the Seller. Transfer documents need to be sent out to the Seller for execution and return with careful attention to timetables to ensure that they are back with sufficient time before settlement to satisfy the Financier’s requirements for prior review and approval. On the return of the transfer, the transfer is then counter-signed by either the Buyers or (more commonly) the Buyer’s Solicitor as being correct for the purposes of registration. Note: The transfer document is customarily only returned by a Seller to a Buyer before settlement if the Buyer is being represented by a licensed legal practitioner by virtue of an undertaking (promise) given by the Solicitor to hold the transfer and not attempt to register or deal with it until the full purchase price is paid over at settlement. This is essential to enable the stamping of the transfer before settlement which will be a requirement of any Financier.
Step 5 – Stamping:
Stamping is the process by which the State Government Tax “Stamp Duty” is assessed and paid. Stamp duty is calculated according to the consideration paid under the Contract unless the transaction is not at “arms length” in which case independent valuation evidence for the property must be produced and stamp duty is paid upon the consideration expressed in the contract or that valuation whichever is the higher. Most Solicitors have the ability to stamp a contract “inhouse”. This means that the Solicitor can certify that the appropriate amount of stamp duty has been collected from the client and is being held in the Solicitor’s trust account in readiness to pay to the Office of State Revenue. If inhouse stamping through the Solicitor is not available, the Contract and transfer documents must be lodged directly with the Office of State Revenue, either through the post or possibly through a direct “online” facility. These tasks however, may take several days to complete. If stamping is being done inhouse with a Solicitor, the Solicitor will require the Buyer to have deposited the required stamp duty amount as cleared funds into the trust account before the contract is stamped. Stamp duty must be assessed on the contract within 30 days of the contract becoming unconditional and then paid within 14 days of assessment.
Step 6 – Settlement:
Settlement is the process by which the Seller, the Buyer and the entering and exiting financiers (where applicable) meet to hand over the money in exchange for title and transfer documents. Part of this exercise involves reaching agreement on a venue and time for settlement between the Seller’s Solicitor, the Buyer’s Financier (if applicable) and the Buyer’s Solicitor. If agreement can not be reached, then the Contract usually dictates a default time and venue at which all parties must attend. The default arrangement however can only be a last resort because the outgoing (ie: the Seller’s Bank or other Financier) and incoming (ie: the Buyer’s Bank or other Financier) tend to dictate terms on where they will or will not attend for settlement and impasses between the two organisations regularly occur requiring special intervention negotiation from the Buyer’s and Seller’s Solicitors. In the lead up to settlement, the Seller’s Solicitor notifies the Buyer’s Solicitor as to how the cheque(s) adding up to the purchase price are to be drawn. This will include a cheque to the existing mortgagee for the payout of that mortgage debt. The Buyer’s Solicitor then takes that information to instruct their Bank on the amounts and payee for the funds they are to provide. If the Buyer is also providing personal funds, then the Solicitor will have either arranged for these funds to be received in and cleared into their trust account or otherwise provided to the financing bank in sufficient time before settlement to be drawn upon as clear funds.
The Buyer’s Solicitor attends and ensures that the correct purchase price is paid over and will ensure that critical documents, such as a release of the Seller’s mortgage are received at settlement again to ensure that the Buyer receives free and clear title in exchange for the contract price.
If there is no Financier, the Buyer’s Solicitor will then take the transfer documents from settlement and attend to registration of the transfer in the following days. If a Financier is involved, the Financier will take the transfer and register it together with a following mortgage encumbrance which secures the advance amounts and gives to the Financier the ability to sell the property should the Buyer fail to meet the required repayments.
Step 7 – Registration of Change of Ownership:
The transfer document is lodged for registration at the Department of Natural Resources who controls the registration of ownership of land under a guaranteed title system in Queensland. This guaranteed system means that the person shown by the department as the owner of the property is guaranteed by the Government as the true owner such that the Government will actually pay compensation to an affected party if their registration details prove incorrect and someone relying upon those details loses money. For example, buying a property from a person who is not actually the owner or advancing money under a mortgage.
At the same time that the registration of change of ownership is recorded at the Department of Natural Resources, an accompanying form (currently a Form 24) is sent on to the Local Municipal Authority who will then correct it’s records to reflect the new owner so that all future rates (and other) notices affecting the property are addressed to the correct person.
If the Buyer purchased the property with borrowed monies provided by a financier (such as a Bank) the financier will usually take the transfer at settlement and attend to lodgement of the transfer for registration along with the accompanying mortgage.
Step 8 – Delivery of Settlement Letter and Statement:
Once registration of the transfer is complete, a Certificate to confirm this is issued from the Department of Natural Resources and this along with a settlement letter confirming the full settlement figures that were used to calculate the monies paid over at settlement, a copy of the searches and a copy of the contract and/or transfer (with notation showing payment of stamp duty marked on it) are provided out to the Buyer usually with the Solicitor’s invoice (if not already delivered).
The Buyer’s Solicitor will usually request that there fees be deposited into their trust account before settlement is completed and may request payment up front of the anticipated search fees before the searches are ordered.
Michael Zande is the Principal of Zande Law Solicitors, with 25 years experience in practice. Michael and his team have had extensive experience in conveyancing matters. Please feel free to review our firm and staff profiles at www.zandelaw.com.au
The information in this article is merely a guide and is not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
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THE CONVEYANCING PROCESS FOR SELLERS
Conveyancing (that is transferring) land in Queensland is a process that actually differs significantly from the practices conducted in other States of Australia, such as New South Wales and Victoria and dramatically from the process followed in other foreign countries like the United Kingdom.
Under Queensland legislation, the professional service to assist a Buyer or a Seller in the conveyance process can only be done for a fee by a law firm or other organisation which has a practicing Lawyer as its nominee for professional indemnity insurance purposes.
Some important features of a standard contract are:
A standard contract term in Queensland requires a conveyance within 30 days with conditions such as finance and building and pest to be complied with in 14 days. These timetables are doable but require swift action and co-operation if they are to be met.
The standard contract states that “time is to be of the essence”. This means that any deadlines contained in the contract are critical and if not completed will give the innocent party rights of termination commonly also with the right to demand compensation.
If a Buyer defaults, compensation for a Seller typically involves:
forfeiture of the deposit – note agents are entitled to claim commission against this;
recovery of the difference between the contract price and any price at which the property is subsequently sold (if lower) provided reasonable efforts on resale are made.
It is important to note that Contracts in Queensland are routinely prepared by licensed Real Estate Agents without assistance or intervention from a Solicitor and are only delivered to the Solicitor after the Contracts are signed by both parties. If the client wishes to receive legal advice upon the Contract before committing to it, it is critical that the Contract be provided to the Solicitor for advice before it is signed.
Otherwise the Solicitor is usually named on the contract and receives a copy of the contract direct from the Agent once signed.
Under Queensland law a Seller is afforded a cooling off period of 5 business days from date of signing contract within which the Buyer can terminate and walk away from the deal. There is however, a penalty of 0.25% of the contract price.
The conveyancing process for a Buyer falls into a number of distinct tasks:
Step 1 – Review of Contract and advice on its terms:
Usually, the Solicitor will send out to the client an introductory letter which summarises the salient points of the contract which are typically:
the settlement date;
the deadline for completion of any conditions (typically the Buyer’s) such as the obtaining of finance or a satisfactory building and pest report and/or the payment of the balance of a split deposit.
The introductory letter will normally have a client questionnaire to be completed by which the client confirms their names and contact details and some property exit information to confirm there will be no penalties in stamp duty or mortgage break fees for selling inside mandatory holding periods. That letter will also contain an authority to act form that must be signed and returned or the Solicitor cannot act.
Step 2 – Satisfying Special Conditions:
The Solicitor will need to monitor and clear off of the contract’s special conditions such as:
the Buyer obtaining finance approval; and
the Buyer obtaining a satisfactory building and pest report; and
any other special conditions.
The Lawyers keep “bring up” diaries which prompt them to chase clients for the answers to these conditions if not communicated however, ultimately the Buyer (or where applicable the Seller) must take responsibility for satisfying the condition or suffering the consequences of termination of the contract.
Step 3 – Conduct of Searches:
The Solicitor for the Buyer performs searches which are intended to confirm that free and clear title to the property can be conveyed to the Buyer so that the Buyer obtains outright ownership and rights of enjoyment and use within the restrictions of the “present use” described in the contract or otherwise relevant Council’s zoning. If the searches reveal any impediments on the property (for example, an easement or other liability to a third party that would pass with the property or a right given to a third party to make some use of the property) then the discovery of these issues may entitle the Buyer to terminate the contract with full deposit refund, the right to demand that the Seller remove the impediment before or at settlement and/or the right to demand financial compensation.
On receipt of the searches, the Solicitor is then able to calculate the final settlement price. Adjustments are made in the purchase price to, for example, ensure that the Seller’s responsibility for payment of council rates up to the day of settlement and/or land tax are met. This is important because these liabilities stay with the land and consequently pass to the Buyer after settlement if not paid.
The Seller’s Solicitor monitors the Buyer through this process and remains on standby to respond to any issues that may arise. Those issues may involve defending the contract against an attempt at termination or a renegotiation in price. To double check the position with rates adjustments the Seller’s Solicitor usually asks the client to provide a copy of their most recent rates notice.
At about this point, the Buyer’s Solicitor should lodge a Settlement Notice with the Queensland Department of Natural Resources. This notifies any persons who might seek to take an interest in the property that the property is presently under contract for sale and protects the Buyer from the Seller attempting to give some other interest in the property to another person.
Step 4 – Preparation of Transfer Documents:
Transfer documents are technical forms that must be completed in strict compliance with regulation and the Buyers’ names as they appear on the contract. Failure to do this will result in a number of serious problems for the Buyer including a liability for double the cost in stamp duty, settlement being unable to be completed due to rejection of the transfer document by the Buyer’s Financier and/or the inability to actually become registered on the Title Deed even though the full purchase price has been paid over to the Seller. For these reasons the transfer documents are prepared by the Buyer’s Solicitor.
Transfer documents need to be sent out to the Seller for execution and return with careful attention to timetables to ensure that they are back with sufficient time before settlement to satisfy the Financier’s requirements for prior review and approval. On the return of the transfer, the transfer is then counter-signed by either the Buyers or (more commonly) the Buyer’s Solicitor as being correct for the purposes of registration. Note: The transfer document is customarily only returned by a Seller to a Buyer before settlement if the Buyer is being represented by a licensed legal practitioner by virtue of an undertaking (promise) given by the Solicitor to hold the transfer and not attempt to register or deal with it until the full purchase price is paid over at settlement. This is essential to enable the stamping of the transfer before settlement which will be a requirement of any Financier.
Step 5 – Instructions for Discharge/Payout of Mortgage:
If the Seller still has a mortgage debt secured against the property (even if the loan has been paid out, but the mortgage is still registered against the property) the Seller will need to sign a written instruction form to the Bank. This is the process by which the Bank is formally notified that the property is under contract for sale and prompts the Bank to prepare the necessary discharge of mortgage document and be ready to calculate a payout figure for the mortgage debt as at the future settlement date.
Step 6 – Stamping:
Stamping is the process by which the State Government Tax “Stamp Duty” is assessed and paid. Stamp duty is calculated according to the consideration paid under the Contract unless the transaction is not at “arms length” in which case independent valuation evidence for the property must be produced and stamp duty is paid upon the consideration expressed in the contract or that valuation whichever is the higher. Most Solicitors have the ability to stamp a contract “inhouse”. This means that the Solicitor can certify that the appropriate amount of stamp duty has been collected from the client and is being held in the Solicitor’s trust account in readiness to pay to the Office of State Revenue. If inhouse stamping through the Solicitor is not available, the Contract and transfer documents must be lodged directly with the Office of State Revenue, either through the post or possibly through a direct “online” facility. These tasks however, may take several days to complete. If stamping is being done inhouse with a Solicitor, the Solicitor will require the Buyer to have deposited the required stamp duty amount as cleared funds into the trust account before the contract is stamped. Stamp duty must be assessed on the contract within 30 days of the contract becoming unconditional and then paid within 14 days of assessment.
Under Queensland law, all of the parties to a land sales contract are jointly and severally liable for any stamp duty payable. Standard contract terms however, usually state that the Buyer is to be solely liable for the stamp duty and consequently “stamping” is not usually a task/liability that should concern the Seller.
Step 7 – Settlement:
Settlement is the process by which the Seller, the Buyer and the entering and exiting financiers (where applicable) meet to hand over the money in exchange for title and transfer documents. Part of this exercise involves reaching agreement on a venue and time for settlement between the Seller’s Solicitor, the Buyer’s Financier (if applicable) and the Buyer’s Solicitor. If agreement can not be reached, then the Contract usually dictates a default time and venue at which all parties must attend. The default arrangement however can only be a last resort because the outgoing (ie: the Seller’s Bank or other Financier) and incoming (ie: the Buyer’s Bank or other Financier) tend to dictate terms on where they will or will not attend for settlement and impasses between the two organisations regularly occur requiring special intervention negotiation from the Buyer’s and Seller’s Solicitors. In the lead up to settlement, the Seller’s Solicitor notifies the Buyer’s Solicitor as to how the cheque(s) adding up to the purchase price are to be drawn. This will include a cheque to the existing mortgagee for the payout of that mortgage debt. The Buyer’s Solicitor then takes that information to instruct their Bank on the amounts and payee for the funds they are to provide. If the Buyer is also providing personal funds, then the Solicitor will have either arranged for these funds to be received in and cleared into their trust account or otherwise provided to the financing bank in sufficient time before settlement to be drawn upon as clear funds.
The Seller’s and Buyer’s Solicitor both attend settlement to ensure that the correct purchase price is paid over in the manner directed by the Seller and to ensure that the Seller’s mortgage is paid out.
If there is no Financier, the Buyer’s Solicitor will then take the transfer documents from settlement and attend to registration of the transfer in the following days. If a Financier is involved, the Financier will take the transfer and register it together with a following mortgage encumbrance which secures the advance amounts and gives to the Financier the ability to sell the property should the Buyer fail to meet the required repayments.
If the Seller is using sale proceeds to fund a simultaneous purchase of an alternate property, then typically any surplus funds from the sale of the Seller’s property are simultaneously paid on to that subsequent purchase. If there is no ongoing purchase, then the surplus sale proceeds are drawn as a cheque in the Seller’s name and then either brought back to the Seller’s Solicitor’s office for the Seller to collect, directly deposited by the Seller’s Solicitor’s settlement agent into a bank account as directed by the Seller or taken by the Seller’s own existing mortgagee Bank for deposit into a credit account being retained by the Seller with that Bank. At this time, the Seller’s Real Estate Agent is notified of the settlement and is authorised to payout the deposit monies being held directly to the Seller less the Real Estate Agent’s commission.
Step 8 – Registration of Change of Ownership:
The transfer document is lodged for registration at the Department of Natural Resources who controls the registration of ownership of land under a guaranteed title system in Queensland. This guaranteed system means that the person shown by the department as the owner of the property is guaranteed by the Government as the true owner such that the Government will actually pay compensation to an affected party if their registration details prove incorrect and someone relying upon those details loses money. For example, buying a property from a person who is not actually the owner or advancing money under a mortgage.
At the same time that the registration of change of ownership is recorded at the Department of Natural Resources, an accompanying form (currently a Form 24) is sent on to the Local Municipal Authority who will then correct it’s records to reflect the new owner so that all future rates (and other) notices affecting the property are addressed to the correct person.
If the Buyer purchased the property with borrowed monies provided by a financier (such as a Bank) the financier will usually take the transfer at settlement and attend to lodgement of the transfer for registration along with the accompanying mortgage.
Step 9 – Delivery of Settlement Letter and Statement:
A settlement letter confirming the full settlement figures that were used to calculate the monies received at settlement and a copy of the contract are provided out to the Seller usually with the Solicitor’s invoice (if not already delivered).
The Seller’s Solicitor will usually request that their fee be deducted from the sale proceeds and paid over at settlement or otherwise deposited into their trust account before settlement.
Michael Zande is the Principal of Zande Law Solicitors, with 25 years experience in practice. Michael and his team have had extensive experience in conveyancing matters. Please feel free to review our firm and staff profiles at www.zandelaw.com.au
The information in this article is merely a guide and is not a full explanation of the law. This firm cannot take responsibility for any action readers take based on this information. When making decisions that could affect your legal rights, please contact us for professional advice.
