When determining whether a person is in contravention of s 21, s 22(1) of the ACL outlines the types of conduct that may be considered unconscionable by the courts which includes the following:

“(1) Without limiting the matters to which the court may have regard for the purpose of determining whether a person (the supplier ) has contravened section 21 in connection with the supply or possible supply of goods or services to a person (the customer ), the court may have regard to:

(a) the relative strengths of the bargaining positions of the supplier and the customer; and

(b) whether, as a result of conduct engaged in by the supplier, the customer was required to comply with conditions that were not reasonably necessary for the protection of the legitimate interests of the supplier; and

(c) whether the customer was able to understand any documents relating to the supply or possible supply of the goods or services; and

(d) whether any undue influence or pressure was exerted on, or any unfair tactics were used against, the customer or a person acting on behalf of the customer by the supplier or a person acting on behalf of the supplier in relation to the supply or possible supply of the goods or services; and

(e) the amount for which, and the circumstances under which, the customer could have acquired identical or equivalent goods or services from a person other than the supplier; and

(f) the extent to which the supplier’s conduct towards the customer was consistent with the supplier’s conduct in similar transactions between the supplier and other like customers; and

(g) the requirements of any applicable industry code; and

(h) the requirements of any other industry code, if the customer acted on the reasonable belief that the supplier would comply with that code; and

(i) the extent to which the supplier unreasonably failed to disclose to the customer:

(i) any intended conduct of the supplier that might affect the interests of the customer; and

(ii) any risks to the customer arising from the supplier’s intended conduct (being risks that the supplier should have foreseen would not be apparent to the customer); and

(j) if there is a contract between the supplier and the customer for the supply of the goods or services:

(i) the extent to which the supplier was willing to negotiate the terms and conditions of the contract with the customer; and

(ii) the terms and conditions of the contract; and

(iii) the conduct of the supplier and the customer in complying with the terms and conditions of the contract; and

(iv) any conduct that the supplier or the customer engaged in, in connection with their commercial relationship, after they entered into the contract; and

(k) without limiting paragraph (j), whether the supplier has a contractual right to vary unilaterally a term or condition of a contract between the supplier and the customer for the supply of the goods or services; and

(l) the extent to which the supplier and the customer acted in good faith.”

Either prior to or at the auction, a reserve price will be set by the seller which is the minimum amount that would be accepted for the property. Upon reaching the reserve price, the auctioneer will inform those in attendance that the property will be on the market and that it will be sold under the hammer to the highest bidder. The successful purchaser will be required to sign the contract immediately and pay a deposit.

In the event that the reserve price is not met, the property will be deemed to have passed in and the seller may reduce the price to the highest bid, which would then signify that the property is sold under the hammer, and the exchange of contracts may take place. Alternatively, negotiations may be undertaken privately with the highest bidder.

For purchasers, it’s important to be aware that if contracts are exchanged on the day of the auction, the usual five day cooling-off period may not be applicable.

The landlord or any authorised person such as an agent, may enter the rental property with the consent of the tenant or with an order from the relevant state or territory body.

There are certain situations where the landlord or any other authorised person may enter the rental property without the tenant’s permission and without providing notice, such as:

>> during emergencies, including circumstances where there is reasonable cause for serious concern about the tenant’s health and safety or any other person on the property;

>> urgent repairs need to be carried out on the property;

>> if the landlord holds the reasonable belief that the premises has been abandoned.

If a relevant Act allows a tenant to install, alter, or renovate a fixture, and the landlord does not allow the action, then the tenant may apply to the relevant administrative tribunal body for an order. However, the landlord may also make an application to the relevant body as well, prohibiting a tenant from removing a fixture, or to seek compensation for the cost of fixing the work, irrespective if the work was done with or without the consent of the landlord.

At the conclusion of the tenancy, the tenant will be able to claim back their bond money and any interest that the bond money has attracted. However, tenants will only receive their bond back if:

>> there is no rent in arrears;
>> they have provided proper notice that they intend on vacating the property;
>> they have vacated the premises in a similar or better condition when compared to the beginning of their tenancy allowing for fair wear and tear;
>> they have not broken the agreement in such a manner that costs the landlord money.

It should be noted that the property must be inspected by either the agent or landlord, and a condition report is to be completed in the presence of the tenant at a mutually agreeable time after termination of the rental agreement. If either the agent or landlord does not complete an inspection at an agreed upon time, it may be a good idea for the tenant to complete an inspection report themselves in the presence of a witness, and any documentation should be signed and dated.

It’s not unusual for a tenant to disagree with what the landlord may have written in a condition report, and in such a scenario, the tenant should make note of their disagreement. If it’s possible, taking photographic evidence may be a good idea and can be used as evidence for the tenant. It may also be handy to have the photo dated and signed by a witness in the event of a dispute. Additionally, a tenant can also apply to the relevant body to have the condition report amended.

If a landlord fails to provide a condition report, then a tenant may be able to produce their own report and have it signed by a witness. A copy should also be provided to the landlord or real estate agent.

Landlords or real estate agents generally cannot list a person on a tenant database without first providing a tenant with an outline of the information they want listed, or take reasonable steps to provide the information to be listed to the tenant. In addition to providing the tenant with the relevant information to be listed, the real estate agent or landlord must give a tenant no less than 14 days to review and to respond to the information to be listed. Finally, if the tenant provides a response, the real estate agent or landlord must consider that response.

Personal information cannot be listed by a database operator unless requested by a real estate agent or landlord, and the information listed must also be made in accordance with the criteria contained in the previous paragraph.

With the introduction of the Bankruptcy and Family Law Legislation Amendment Act 2005 (Cth)(the Amendment) afforded non-bankrupt spouses greater protections in property proceedings with the insertion of the s 59A provisions into the Bankruptcy Act. The provisions provides that ss 58 and 59, being the vesting sections, are subject to orders made under Pt VIII of the Family Law Act 1975 (the FLA). So what does that exactly mean? Well, what it essentially signifies is that the income of the bankrupt does not vest in the trustee, therefore, allowing a non-bankrupt spouse the ability to seek maintenance from a bankrupt spouse.

The Amendment gave a non-bankrupt spouse the right to share property of a bankrupt spouse, and if we look to s 4(1) of the FLA under the definition of “matrimonial cause” at paragraph (cb), reference is made to proceedings between:

· a party to a marriage; and

· the bankruptcy trustee of a bankrupt party to the marriage.

Trustees can join a party to family law proceedings if the court is satisfied that any interest of the creditors of a bankrupt will be affected in a property proceeding, as outlined in s 79(11) of the FLA. What we should highlight is if proceedings are on foot which includes a creditor and non-bankrupt spouse, neither party has greater priority over the other under s 79 of the FLA. In Billtoff and Billtoff (1995) FLC 92-614, the Full Court of the Family Court of Australia at Perth said:

“Although, there is a general rule, it is not absolute, is not prescribed by statute and there are a number of well recognised exceptions. There is no requirement of that the rights of an unsecured creditor or a claim by a third party must be considered and dealt with prior to the Court making an order under sec 79, nor is there a rule of priority as between a creditor claimant and a spouse. Those rights, however, cannot be ignored. They must be recognised, taken into account and balanced against the rights of the spouse.”

Under the provisions of s 79(12) of the FLA, there will be certain circumstances where a trustee in bankruptcy must be joined to the proceedings, and the bankrupt needs to obtain leave in order to make submissions if the trustee is a party.

There are various situations where the right to redeem in equity can be extinguished, and can be generally done so under the following circumstances:

>> the mortgagee chooses to foreclose a property;

>> the mortgagor has not enforce their right within the statutory limitation period;

>> the mortgagee has purchased the right of redemption.

However, we should note, that equitable jurisdictions may be reluctant in interfering with the enforceability of the right of redemption. One such example that may be considered as interference in the enforceability of the right of redemption will be a situation where either a right or option to buy a mortgaged property extinguishes the right to redeem. Such a right can only be done so via a separate and independent agreement.

Most people would be aware of what trespass constitutes, and you would be correct in your assumptions, because trespass is indeed the wrongful interference by one person, with the property or goods belonging to another party. In order for trespass to be considered wrongful, it must be done voluntarily, is unauthorised, and the trespass must be direct.

Perhaps the most fundamental aspect of trespass, is that there must be a direct link between the actions of the person committing trespass, and the interference with the other person’s property or goods.

For the most part, a lessee will not be responsible for the payment of any outgoings unless so provided within the leasing agreement, and which is also recoverable within legislation.

All States and Territories have some sort of provision in regards to outgoings, and we can look at s 39 of Victoria’s Retail Leases Act 2003 as our statutory example, with the section stating a tenant is not responsible for any outgoings, except in accordance with the provisions of the lease that specify:

>> the outgoings that are to be regarded as recoverable; and

>> in a manner consistent with the regulations, how the amount of the outgoings will be determined and how they will be proportioned to the tenant; and

>> how any outgoings or any part of the outgoings may be recovered by the landlord from the tenant.

Furthermore, the outgoings under s 39(2) of Victoria’s Act, may also prescribe the manner in which the amount of outgoings can be determined and apportioned by a tenant.

It may be somewhat hard to believe, that any pets that has wandered onto another person’s property, may be impounded if the animal has entered into the property without the consent of the owner or tenant. The pet may be impounded for a certain number of days depending on the jurisdiction, after which, the pet must be taken to a council pound. Any person who has made the decision to impound the pet must ensure that the animal is properly cared for by providing adequate food, water and shelter.

Trying to determine who is a boarder or lodger is somewhat a legal grey area. Broadly speaking, borders and lodgers receive meals from a landlord – with the landlord also retaining a position of authority over the property.

Meanwhile, a sub-tenant is classified as someone who lives with a head-tenant – the person whose name is on the lease – with permission from the landlord. A sub-tenant has to pay rent to the head-tenant. Furthermore, the landlord exercises no legal control over a sub-tenant, and it is the head-tenant who is seen to be the landlord in such a scenario.

To complicate matters further, if a head-tenant sublets the property without permission from the landlord, the action may be a breach of the tenancy agreement and the landlord can potentially terminate the lease. However, if a tenant takes in a boarder or lodger, they don’t require the permission from the landlord as long as the number of people staying on the property does not exceed the maximum number outlined in the tenancy agreement.

A common law right does exist which allows for a tenant to sublet their interest, however, it is common practice for a covenant in a lease which does not allow for, or restricts a tenants ability to create a sublease.

Therefore, if a common law right does exist for a tenant to create a sublease, can a landlord prevent a tenant from subletting their interest? Unless there is an absolute prohibition preventing a tenant from assigning a sublease, there is no impediment for a tenant to sublet a possessory interest in regards to the rental property.

On the other hand, if there is an agreement between the landlord and the tenant which contracts out their common law right to sublet the property, then any action in which the tenant sublets their interest in the property will be considered as a breach of the covenant.

Once the mortgagee accepts payment, the equitable right of redemption is enforceable – even in instances where payment is made after the due date. Additionally, the equitable right of redemption can also be enforced by a Torrens title mortgagor even though they retain legal title, as Finkelstein J stated in Australian Securities and Investments Commission v GDK Financial Solutions Pty Ltd (in liq)(No 3) (2008) 246 ALR:

“In my view a mortgagor of Torrens land has a legal right to obtain a discharge of mortgage on payment of the amount secured by the mortgage (or, subject to any rights of foreclosure, a lesser sum if the proceeds are insufficient to cover the debt) and equity applies the appropriate remedy, usually in the form of a mandatory injunction or specific performance.”

You don’t have to wait until you have signed a contract before you contact a conveyancing lawyer.  It is unwise to sign a contract without first consulting an experienced property lawyer.

In addition to the purchase price, a buyer will incur land transfer duty, registration fees payable to the Registrar of Titles, conveyancing fees and search costs, inspection costs and where funds are borrowed, bank fees and valuation costs.

The costs of selling a property include real estate marketing fees and also commission, typically charged between 1% and 3%.  Other costs include fees payable to discharge any mortgage, search costs and conveyancing fees.

It is preferable for the buyer and seller to use their own independent property lawyer to ensure no conflict of interest arises.  Conflicts can easily arise and are likely to pose a problem if both parties use the same property lawyer or conveyancer.

When you subdivide a property you essentially are splitting one single title into multiple titles.  Subdivision has certain advantages, like the ability to sell part of your property. You can also reduce your loan, if you sell off a part of your property to another buyer.

When selling real estate privately it is essential that the seller obtains the expert guidance of a property lawyer to prepare the section 32 statement and contract.

Your Property Law Team

Property Law specialist Brian Reckas
Brian Reckas
Tahereh Rouhipour
Danielle Henderson
Dan Nicolas

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