What is a chattel and a fixture?
1.Would a 6x3x1 metre above-ground pool be classified as a chattel? Explain what further information is needed, and how a court might deal with such a matter. Would the surrounding child-proof fence be similarly classified? ( answers all the parts 150 words)
2.Harry purchased land with improvements in Melbourne. The one page Section 32 Statement had attached to it a title search which had been conducted 18 months earlier, a 12 months old Municipal rate notice (not a land information certificate) and nothing else. What should you do? Do you consider any section of S. 32 of the Sale of Land Act 1962 would apply?
3.If Harry and Sam conducted an inspection of the property the day before settlement and discovered that the concrete bird bath and its stand were missing from the rear garden, explain if such a breach of contract would entitle them to refuse to settle, if the contract was silent on this point?
4.Keiko was granted a life estate in Murakami Estate by way of gift. Keiko won a substantial prize in a lottery and purchased the estate in fee simple in the estate. Advise Keiko of the status of her life tenancy upon settlement of her purchase of the estate in fee simple.
5.If Keiko owned the rear property to Murakami Estate and had placed a covenant in the contract that Su and Hew were prohibited from building more than one single storey dwelling house on Murakami Estate, how would such a restrictive covenant be incorporated into the Title?
6.William's mum received a gift of $100,000 (from her first cousin) when William was 12 years of age. The gift was accompanied by a signed letter stating the gift was: “to be applied for the benefit of William until he reaches the age of 21 years, as [William's mum] sees fit", William's mum immediately decided to invest the money on William's behalf by purchasing Ivanhoe Manor, and she signed a document with her solicitor at the time of purchase declaring the true facts. The land was eventually registered in her name. Explain and advise William's mum of the likelihood of stamp duty being attracted under the Duties Act 2000 (Vie.) by her transferring the land from her name into William's name. Assume Ivanhoe Manor was purchased for $100,000 nine years ago and is now valued at $1,000,000.
Advising Sam on a contract of sale with an electrical fault
7.William sold a leasehold estate to Rod for a consideration of $220,000. William knew that Rod intended to use the leasehold for a restaurant, which strictly required use of the 20 car parking spaces on the title. One month before settlement William received a letter from the municipality advising that the municipality and Vic Roads intended to compulsory acquire some of William's land for an approved road-widening scheme, which would remove the entire car park. With respect to William, does caveat emptor apply in the light of the information? Give reasons.
8.Sam signed an unconditional contract of sale to purchase Blueacre. A term of the contract specifically stated that the purchaser "shall accept all risks associated with the land sold on the signing hereof'. The vendor was in occupation of the land. Due to an electrical fault, the premises on the land caught fire and were destroyed, including the vendor's large indoor marijuana crop. The vendor's insurer investigated the cause of the fire, along with police and fire brigade investigators, after the vendor claimed on his insurance policy. Sam, who had fallen in love with the land, wishes to complete the purchase, but only if he may take advantage of the vendor's insurance policy. With reference to the Sale of Land Act 1962, advise Sam.
a) Must the vendor disclose a fencing notice from his neighbour?
b) Must the vendor include a VicRoads statement with sale?
c) Under the insurance contract act 1984; Can the purchaser rely on vendors insurance?
d) Is the insurer liable for the purchaser’s loss?
e) To what extent is the insurer liable?
f) Are there restrictions if the purchaser takes possession.? Upon what legal principle is this based?
g) If a contract is subject to finance, can the deposit be released to the vendor pursuant to section 27?
h) What are the main acts and subordinate legislation that govern the operation of VCAT?
9.Homer Simpson is selling his farm of two titles (one old title and one torrents title) and the parties have agreed the vendor will provide two Transfer of land Act Titles. However the new purchaser does not want to pay GST and keep stamp duty to a minimum. What would you (conveyancer) advise?
As a general rule a person may freely dispose of property to which they have title, and a person may purchase property, which is offered for sale. There are 2 qualifications to this general rule, explain them.
10.Beyoncet has organised the sale of her property and it is going smoothly. However two weeks before settlement she received a call from the r/e agent advising the purchaser wanted to add clauses/conditions to the contract to ensure the property was left in good condition on expiry of the lease and for when she moves in.
11.Given that Beyoncet and James were overseas and were only contactable via email, her Conveyancer advised the r/e agent that given the purchaser had already signed the contract with the lease condition, it would not be in the vendor’s interest to be adding further conditions now, and the condition of the property on expiry of the lease would be covered by the bond, which is something the r/e agent needs to manage.
- a) What do you think the outcome was to this situation for the purchaser? Why?
- b) Beyoncet was enjoying her short break with James overseas and she sent her Conveyancer instructions to get the deposit released for her unit. It seems the holiday was a bit more expensive than they had planned and they have run out of money.
12.Unfortunately on the letter from the bank, for s27 purposes the purchasers conveyancer states Beyoncet has her account in default and on that basis the purchaser won't release the deposit unless the bank writes another letter saying that our client is not in default.
What do you do?
What is a chattel and a fixture?
Answer:
Answer 1
A chattel is an item which is not fixed to the land and a fixture is in item which is affixed to land and looks like the part of the land itself. In the given situation as the size of the pool is large it may be a fixture, however as it is not fixed to the ground and above it, the pool would be taken as a chattel. In the same way as the fence is also not fixed to the ground it would be taken as a chattel.
Answer 2
In this situation we can ask the vendor to provide all the documents which are mandated under the provisions of s 32 to be provided in relation to the statement. The specific sections which should be applied in the situation would be in s 32I in relation to disclosing title and s 32J in relation to notice.
Answer 3
There is not enough evidence in the situation to allow them to refuse settlement. This is because firstly the contract was silent in this point and secondly the parole evidence rule only allows terms which are written to be a part of the contract once it is documented. Further, the missing items may be considered as a warranty of the contract and not condition. Therefore breach of warranties cannot be used to refuse settlement. However a claim for damages may be made.
Answer 4
The first requirement which Keiko has to meet is to have an agreement with the beneficiaries of the state. These are the people who are going to get the estate after Keiko dies. If there is no agreement between them and Keiko, the transfer is not valid and the estate would pass to the beneficiaries after Keiko’s death.
Answer 19
The certificate of title would have the restrictive covenant. A written contract is also needed between Su and Hew with Keiko.
Answer 5
The trustee is allowed to transfer land under the Duties Act without being subjected to duties in case the transfer is done in relation to the legal beneficiary and the land is acquired after the creation of trust between the parties. In the present situation a trust was formed before the acquisition of land. This means that the transfer of land would be duty free under the Act from the mother to William.
Answer 6
In light of the facts of the case the doctrine of caveat emptor would be applicable. This is because William knew about the fact that the land was to be used by Rod for a restaurant where a minimum of 20 car parking space was needed. Further, he also has information that the municipality would use the space before the settlement takes place.
Advising Sam on a contract of sale with an electrical fault
Answer 7
The application for s 35 of Sale of Land Act ensures the benefit of the purchaser through an insurance held by the vendor. Under s35(1) the purchaser is provided the legal right through which he needs to be compensated by the insurer in the same as it would have compensated the vendor in situation where the sale of land did not take place. In light of the facts and above discussed law, am would be able to benefit from the insurance policy held by the vendor.
Answer 8
- No a fencing notice is not needed to be disclosed by the vendor under s 32 as the section does not mandate information about a fencing notice to be provided.
- Yes, the information is needed under the Planning and zoning information head of s 32 as this section expressly deals with the use.
- The purchaser has the right to rely on vender insurance under s 50 of the legislation
- The insurer would be liable to the loss of the purchaser under s 35 of Sale of Land Act this is because under the section the purchaser is provided the legal right through which he needs to be compensated by the insurer in the same as it would have compensated the vendor in situation where the sale of land did not take place.
- The insurer is liable to compensate the purchaser in the same as it would have compensated the vendor in situation where the sale of land did not take place
- The coverage ends when possession is taken by the purchaser. The legal principle behind it is that there is no contract between the purchaser and the insurer.
- Because exceptions to section 27 do not include finance, the deposit is legally entitled to be received.
- The main Act is Victorian Civil and Administrative Act 1998 and the subordinate Act is Subordinate Legislation Act 1994.
Answer 9
In this situation my advice would be that the sale is to be made only by one title as it would help the purchaser save stamp duty and other complications.
Answer 10
The two exceptions state that the parties should not have an unsound mind or a minor when the contract is created or a person prohibited by law and the consent provided by the party has to be free meaning that there is no duress, misrepresentation, coercion or unconscionable conduct. When a person does not have capacity to get contract any agreement made by them can be rendered as void. In addition, even if the consent of the parties have not been legally obtained it would be considered as sufficient for making the contract void or voidable at the option of the party.
Answer 11
Under the rules of FCT v McDonalds a sale of property takes place when the contract between the parties had been signed. In this situation also the contract between the parties had been signed before. In case any alternation is needed in the contract it would require a new consideration and would not be valid otherwise. Here the addition of the new terms to the contract would not be considered as legally binding and is not mandatory to allow. Further in case the terms are nit in the interest of the vendor they may be rejected by the vendor as a meeting of minds may be required for the formation of a contract. Unless the vender agrees to get the new terms added to the contract they are not to be added as contractual terms.
Under section 27 of the SOLA rules in relation to deposits have been provided. under this section the vendor can claim an early deposit which is before the date of settlement. In a few situations it may be considered as safe to let the vendor have early access to the money before the settlement is conducted. For this to take place both the contractual parties are required to sign the early release of deposit form. This allows the person holding the deposit to release the amount. In case the agent of the lawyer does not consider it safe to release the deposit early they may advice the purchaser form not allowing the release. In the present situation also where the agent is not finding it safe to release the deposit it would make it totally legal to not allow it under section 27.
