Q. I can’t understand why conveyancing costs vary so much and what would be a fair fee to pay either on a sale or purchase of a property in NSW?
A. There is great variation in conveyancing costs as much of work is being carried out by unsupervised and unqualified staff. This practice has become widespread and no one can make any money out of conveyancing where the costs fall below $1,210 plus GST plus disbursements for a sale and $1,430 plus GST plus disbursements for a purchase. No one whether vendor or purchaser should forget that conveyancing is all about the transfer of title from one individual to another and if the work is not properly performed someone is in danger of not obtaining title which is unlikely to be discovered for a number of years until the property is sold. Why would anyone take this risk as the greatest single asset most people acquire during their life is their home, so clients should think very carefully before they accept any offer to convey property below this.
Q. How important is it to get legal advice in the area of commercial leases?
A. Most people today tend to believe that little expertise needs to be applied to both leases and conveyancing. This couldn’t be further from the truth. In the area of commercial leases there has been a recent decision of the NSW Court of Appeal which confirms how important it is for small business operators to get legal advice on commercial leases. In that case a tenant sued the landlord. In that case the tenant had failed to obtain proper legal advice and had not executed a lease leaving it open to the landlord to have him evicted causing the tenant to sue alleging that there was an informal or equitable lease on foot. The tenant lost as he had no formal right to run his business from that location and as a result he had imperilled his commercial interests and ended up having to pay the other party’s costs.
Q. Recently I was kicked out of a commercial warehouse which I occupy as part of my business which the landlord alleged was invalid even though it was signed by the agent on his behalf. Can you help me and what are my options?
A. Yes. Provided you have acted in good faith and have signed the lease then it would appear the landlord is in trouble. He will refer to the managing agency agreement but there is no privity of contract between you and the agent as he was acting for the landlord. Irrespective the agent would appear to have his actual or ostensible authority and therefore the capacity to bind his principal, the landlord. Should the lease have been incorrectly terminated by the landlord then your options are clear and fall into two categories: (i) equitable relief and (ii) to sue for damages at common law.
Q. I understand that there have been some substantial changes to retail leases legislation in NSW and Victoria and what impact do they have on landlords?
A. One of the most significant changes in NSW has been in the area of security bonds and as from 31 March 2007 all landlords are to deposit all tenants’ security bonds with the Director General of the Department of State and Regional Development irrespective of when the tenancy commenced. As a result it will become far more difficult for landlords to make a claim against the bond with landlords having to make a written application to the government setting out the basis for their claim. Should the tenant disagree with the claim then the dispute may be referred to the tribunal for resolution. Issues relevant to Victoria follow.
Q. Under these amendments are promotional or advertising levies caught?
A. Yes. Previously where landlords imposed levies on tenants they could determine how the money was to be spent. Under these amendments landlords are now required to advise tenants in advance how this money will be spent and need to provide a detailed explanation to tenants every six months setting out the basis on which the funds were expended.
Q. Although there have been a number of changes introduced in Victoria under the Retail Leases (Amendment) Act 2004 will they have the same impact?
A. No. The thrust of the Victorian amendments is that landlords, their agents and prospective purchasers must be made aware of these amendments and others in order to comply with their obligations under the Act to avoid penalties. Under the Victorian legislation the definition of retail premises has been amended to include part of the premises which are used wholly or predominantly for the retail sale or hire of goods or provision of services. The application of the legislation is far more straightforward than before.
Q. Is it true that the Victorian Government has made amendments reducing landlords’ obligations to maintain and repair retail premises?
A. Yes. Originally landlords were required to maintain leased premises in good order, condition and repair. Following the changes landlords are now only required to maintain the premises in the same condition that they were in at the time that they were leased or to any higher standards specified in the lease,
Q. Under Victorian legislation are there any significant procedural changes which have been introduced?
A. Yes. Some concern the time at which tenants are to be given a copy of the executed lease from the provision of disclosure statement by the landlord to the tenant and notification of renewal of a lease to the Small Business Commissioner. In both NSW and Victoria following the recent changes to the relevant Retail Leases acts lawyers should be retained to advise both landlords and tenants with respect to any matters arising there under.