FARM WEEKLY ARTICLES

ENCUMBRANCES ON LAND

ENCUMBRANCES ON LAND

When you are buying or leasing any land whether farming land, commercial land or residential land it is vital to review the title for the existence of any registered encumbrances.  WA Property Lawyers provide this service as a matter of course with every settlement.

An encumbrance is a legal interest held by or duty owed to someone other than the registered proprietor (legal owner) of property.  It creates a burden, obstruction or impediment placed (in most cases) on the certificate of title of the land.  An encumbrance exists where a person other than the registered proprietor of land has a right or interest in land that restricts or impairs the transfer of the land.  Typical encumbrances placed on properties are liens (such as mortgages) and limitations (being easements, covenants and restrictions).

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WATER LICENCE TRANSFER PROCESS

WATER LICENCE TRANSFER PROCESS

Water rights in Western Australia are governed by the Rights in Water and Irrigation Act 1914 (‘the Act’). Under the Act, you may need a water licence for taking or interfering with surface water, overland flow water or groundwater.

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EARLY ACCESS ISSUES IN PROPERTY PURCHASES

EARLY ACCESS ISSUES IN PROPERTY PURCHASES

Often when farmers are negotiating a sale of their farmland, prospective Buyers may require the right to access the land prior to settlement for various reasons.

Some of those reasons may be:

  1. Property due diligence such as soil testing or mapping;
  2. Weed control over summer;
  3. Ground preparation for seeding, cultivation and soil amelioration;
  4. Other General due diligence requirements.

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TRUST PURCHASES AND DECLARATION OF TRUST

TRUST PURCHASES AND DECLARATION OF TRUST

Many farming clients choose to buy their farming properties in a newly formed or an established Family Discretionary Trust.  When buying in this format it is extremely important to get the correct wording on the Offer and Acceptance document.  It needs to be correct right from the first version of the Offer and Acceptance as it is difficult to change once the contract is signed.

It is important for the Trustee details to be exactly correct, whether the Trustee is a personal trustee or whether there is a company acting as Trustee of the trust.  It is also vital that the Trust name is correct.

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GST ON FARMLAND SALES

GST ON FARMLAND SALES

The Goods and Services Tax (“GST”) is a broad based tax of 10% on the supply of most goods, services and other items sold or consumed in Australia unless they are GST-free or input taxed.

A contract for the sale of farmland should include a reference to the liability or otherwise for collection of GST.  Failure to refer to the GST component of a sale could see the seller paying GST from the proceeds of the sale rather than having collected it in addition to the sale price. For the buyer it could affect the amount of duty assessed and payable.

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