week 6+7 Flashcards
freehold estates can be either
Freehold estates can be owned by more than one person simultaneously this joint ownership can either be joint tenancy or tenancy in common
explain joint tenancy
Joint tenancy – reflects the situation where there is no separation of ownership between the tenants – therefore no tenant owns a identified or distinct share of the property
what are the 4 unities for tenancy in common to be created
- Utility of possession – all tenants are simultaneously entitled to possession and enjoyment of the entire parcel of land
- Utility of interest – all tenets hold the same interest
- Utility of title – the title of each tenant to the property was given under the same disposition (e.g. will)
- Utility of time – the title of each tenant to the property was given at the same time (e.g. will)
what is the right of survivorship
The right of survivorship refers to the process by which ownership is referred to the remaining surviving joint tenants upon the death of a joint tenant.
The final remaining tenant is entitled to sole enjoyment of the land and can pass it on to who they choose.
explain retirement villages
- There are a number of different models for residents of retirement villages to acquire an interest
- Licence – Resident purchases a licence from a village owner entitling the resident to occupy a lot and use facilities
- Lease – Resident take a lease of a lot for a fixed term (99 or 199 years) and therefore obtains a leasehold interest
- Home unit company – Resident purchases shares in a home unit company which owns the village (similar to company title to be discussed later in this class)
- Freehold title – Resident purchases the freehold title to a lot registered under strata title / community title legislation
explain entry into retirement villages
Entry into a retirement village
• The legislation controls a number of aspects:
• Operator must provide a disclosure statement;
• Right to inspect – site plan, location, floor plan, dimensions, budgets, accounts, village contracts, village rules;
• An incoming resident must enter into a written contract – residence or service contract.
explain management of a retirement village
• The legislation regulates general management:
• Making of village rules;
• Obligations of operator, residents and visitors;
• Security
• System for emergencies
• Residents committee
Financial Management
• Insurance, replacement of capital expenditure, payment of recurrent charges, budgets etc
explain tenancy in common
Tenancy in common – where an estate us held in a tenancy in common, each owner has a distinct and specified share in the property. Whilst each tenant has a distinct ownership share the property in its physical state, is not demarcated to reflect the share held.
The only unity present is the unity of ‘possession’
explain creation of co-ownership at law
The common law presumed that upon the grant of an interest in land to two or more people, a joint tenancy was created. The presumption applied unless there was evidence that one of the four unities was missing or that the grant expressly stated that the interest was to be taken as tenants in common
The presumption is now provided for by statue, however the presumption is applied in favour of either a joint tenancy or tenancy in common, differs across jurisdictions. An express provision in the grant to the contrary will be needed to rebut the presumption
explain creation of co-ownership in equity
Equity applies the presumption that a tenancy in common is created where an interest in land is granted to two or more people. A tenancy in common may be created in equity, although the parties may be registered as owning the property as joint tenants. To create a co-ownership in equity, the intention of the parties will be relevant. The equitable remedy may be that of a resulting or constructive trust.
In a community title or strata title scheme there are two types of ownership: the ownership of the freeholds lots (fee simple) and the ownership of the common property. The ownership of the fee simple title is held by residents while the owning of property in common is vested in the body cooperate that comprises the scheme
Governing legislation – strata title is created through operation of jurisdiction specific legislation
explain lot entitlements
Attributed to each lot at the time the scheme is created and used to calculate the owners voting rights and contribution to the scheme. As a general principle the lot entitlements for the scheme should be equal.
EXPLAIN community operate entity
Once the plan is registered, a freehold title is issued to each lot owner, and title in the common property is vested in the community’s cooperate entity. The members of the body cooperate are those who hold an interest (each lot owner) in the scheme
The body cooperate is required by statute to perform certain functions including: maintaining insurance policies, ensuring owners comply with by-laws, holding members meetings, maintaining and repairing the common property and keeping relevant records
By laws – refer to the community rules that govern the scheme e.g. keeping of pets
explain dispute resoultion
Disputes can arise between lot owners and the management committee. The body cooperate must act and take decisions in the best interest of all lot holders. The legislative scheme operating in each jurisdiction prescribes a dispute resolution process for community lot owners. The process vary between states, but generally speaking the dispute resolution is a three tiered process with the parties required to attend mediation before taking the matter to a specialized tribunal or adductor, if the matter can sill not be resolved it will proceed to a court.
- Debt Recovery – big area of dispute for OC
- Liability of lot owners not paying contributions
- Internal
- Complaints can be made directly to the OC from a lot owner, manager or occupier
- The OC can make a decision not to do anything; to take action for a breach (act or rules) or apply to VCAT
- External
- Different levels
- Commissioner’s Office – Adjudication (e.g. Queensland)
- The CATs – VCAT, QCAT, NCAT, SAT(W.A)
- Courts
what is a retirement village
To determine weather a scheme is a retirement village consideration will need to be given to the legislative definition of “retirement village”. The type of title that a resident has in a retirement village will depend upon the terms of the contract that the resident enters into with the retirement village operator – the resident may be granted freehold, leasehold or right to reside.
The type of title held by the resident will determine how the interest can be disposed of an any applicable exit costs
explain retirement village management
The operators of the retirement village are legally required to disclose certain information to potential residents. The information to be disclosed includes the services that will be available and the rules (e.g. by laws) that apply – failure to comply with the requirements may be an offence (retirement village act 1986s VIC)
Statements made in the disclosure documents must not be misleading or deceptive as village operators are subject to the provisions of the Australian consumer law within the competition and consumer act 2010 and the fair trading legislation
The village operator is responsible for capital costs associated with the village and its facilities. Residents are required to contribute the costs of running the village. The operator of the village is required to account fully to residents and is required to prepare financial documents detailing the money spent and future budgets. Increase in contributions must comply with statuary provisions
