"and/or nominee" in QLD

Hi everyone

Hopefully this won't be a dumb question! Hubby and I are looking at exchanging contracts on an OTP deal near Brisbane. Completion isn't due until mid-late 2011 and a such we aren't 100% sure what structure will be most beneficial for us at settlement time. Most likely outcome would be purchasing in hubby's name. We are also looking to use a deposit bond.

Is it possible to frame the purchaser's name in such a way that we can make a final decision on the best structure closer to the actual settlement? For example, can the purchaser's name be "hubby's name and/or nominee(s)"? Are there any stamp duty implications in this regard, or any issues when applying for the deposit bond?

I hope that makes sense. Any feedback greatly appreciated.

Angela :)
 
Thanks for the reply Propertunity. I actually did a search for earlier posts on this topic but none were really on point. Thanks for the link, it was quite helpful. Will contact a Qld solicitor on this one.

Angela :)
 
In WA at least, you can state and/or nominee, however you must name them on the contract at the time of signing, that is before going unconditional.
Get a legal opinion - dont take my word for it...I'm an ex-diesel mechanic for sh*ts sake!:D

Boods
 
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I tried doing this on one of my first purchases in QLD (after reading it from a property book where the author is in Victoria) and my solicitor raised her eyebrows - it's not the same as in VIC where you can nominate after you sign. Ask your solicitor. :)
 
Thanks everyone for your replies. I'll follow up with a Qld solicitor and post their response in case anyone else is interested in the answer.

Cheers
Angela :)
 
hi all
they do have some funny rules in qld and there contracts look funny as well
not saying I don't like them I do but the rules are very different.
for me buying anywhere use a legal from that area and don't even offer in some states without knowing the rules.
cross a boarder and look at it as if crossing into another country to buy
work on that and you will find you are fine
 
Just to recap...

Hubby and I are looking at exchanging contracts on an OTP deal near Brisbane. Completion isn't due until mid-late 2011 and a such we aren't 100% sure what structure will be most beneficial for us at settlement time. Most likely outcome would be purchasing in hubby's name. We are also looking to use a deposit bond.

Is it possible to frame the purchaser's name in such a way that we can make a final decision on the best structure closer to the actual settlement? For example, can the purchaser's name be "hubby's name and/or nominee(s)"? Are there any stamp duty implications in this regard, or any issues when applying for the deposit bond?

Well I spoke to a Qld solicitor and the verdict is in. Having "and/or nominees" on a Qld contract is viewed negatively and is considered to make the contract appear somewhat tenuous. It is thus generally not recommended. It also makes it highly probable that double stamp duty would be payable.

The solicitor's recommendation was that a buyer can request the seller to agree to a "contract re-arrangement". In essence the buyer submits a deed of recission of the original contract, but this is subject to the simlutaneous entering into of a new contract to purchase the property in question. The advice I received is that the only costs implications (for the buyer) are extra charges levied by both the buyer's and seller's solicitors. However, this would still seem to be much cheaper than risking double stamp duty, or the potential future costs implications of having to change a bad structure.

The final comment was that the seller of course can simply refuse to accept the contract re-arrangement, however this solicitor has never had one knocked back, as there is no real disadvantage to the seller (they still get their sale and any extra legal costs are paid by the buyer). Please don't rely on this information though...seek your own advice (and let me know if mine was flawed! :D).

Angela :)
 
Just to recap...



Well I spoke to a Qld solicitor and the verdict is in. Having "and/or nominees" on a Qld contract is viewed negatively and is considered to make the contract appear somewhat tenuous. It is thus generally not recommended. It also makes it highly probable that double stamp duty would be payable.

The solicitor's recommendation was that a buyer can request the seller to agree to a "contract re-arrangement". In essence the buyer submits a deed of recission of the original contract, but this is subject to the simlutaneous entering into of a new contract to purchase the property in question. The advice I received is that the only costs implications (for the buyer) are extra charges levied by both the buyer's and seller's solicitors. However, this would still seem to be much cheaper than risking double stamp duty, or the potential future costs implications of having to change a bad structure.

The final comment was that the seller of course can simply refuse to accept the contract re-arrangement, however this solicitor has never had one knocked back, as there is no real disadvantage to the seller (they still get their sale and any extra legal costs are paid by the buyer). Please don't rely on this information though...seek your own advice (and let me know if mine was flawed! :D).

Angela :)

Yes but I once acted for some Greek sellers- would cost $14k stamp duty if we did not agree to the recission- our clients charged $5k for the pleasure to rescind and enter a new contract.
 

Terry
Thanks for the link
the following quote was interesting
I put a change of entity clause in which means I can change entity 14 days prior to settlement as long as I pay the sellers and my own legal cost in changing the entity, then there is no risk of ever getting a double stamp duty slam by the Gvt.

My solicitor is a head lecturer at REIQ and works on major crown law matters and contracts in Qld so I am guided by his knowledge.

Change of entity clause is a more protective and cost effective method to use in your contract if you are not sure what entity to purchase in
 
Terry - thanks for the great link. I agree with BV that the quote re: a change of entity clause was certainly very interesting. We haven't exchanged contracts as yet, so I will put this suggestion to our solicitor and see what they say. It cetainly sounds a lot more cost effective.
 
Terry
Thanks for the link
the following quote was interesting:

Quote:
I put a change of entity clause in which means I can change entity 14 days prior to settlement as long as I pay the sellers and my own legal cost in changing the entity, then there is no risk of ever getting a double stamp duty slam by the Gvt.

My solicitor is a head lecturer at REIQ and works on major crown law matters and contracts in Qld so I am guided by his knowledge.

Change of entity clause is a more protective and cost effective method to use in your contract if you are not sure what entity to purchase in

Further to the quote above, are there any QLD solicitors out there who would be able to provide confirmation that double stamp duty definitely would not apply if a change of entity was to be enacted as a result of the clause referred to?

How should the wording of the clause be phrased? eg. can it include saying that the Buyer will be responsible for the payment of the reasonable legal costs incurred by both sides in effecting the change in entity? The aim being to avoid the exhorbitant fees referred to by cu@thetop. Does the clause usually refer to changing entity 14 days prior to settlement (or some other set timeframe)?

Overall is the main attraction of this approach the fact that the Seller is contracturally bound to accept a change in entity versus seeking their good will in agreeing to a contract rearrangement?
 
The chaser
It would be interesting to see other people's views.
I don't understand how the QLD gov can hit you with stamp duty
when a contract is not finalised
 
Stamp Duty is due within 30 days of exchange usually, settlement could be 12 months delayed but the OSR won't wait that long for their money.

I think it is different in Qld. My understanding thus far is that for OTP purchases in Qld transfer duty is paid when you settle. Can any Qld investors clarify this point? Thanks.
 
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