Queensland Law Society

Property law updates

Updated Wednesday 6 May 2020

Q&As - property issues during COVID-19

Monday 6 April 2020

QLS has prepared this Frequently Asked Questions document for our members, available here.  The purpose of these FAQs is to answer (as best we can) common questions from practitioners raised with QLS. The material and information in this document does not constitute legal advice.  QLS members are reminded that they can contact the Solicitor Assist program for free legal advice. 

This FAQ document deals with a range of concepts that might arise in the current environment. Lexon insured practices will see many of these concepts in active risk tools updated and released over the pandemic period. Visit Lexon’s Covid-19 webpage to locate this material. 

QLS gratefully acknowledges the assistance of its Property and Development Law Committee in preparing this material.  


A sample of the FAQs are set out below. 
  1. Can I lodge my documents at the Department of Natural Resources, Mines and Energy business centres?

    No – as from 31 March 2020 and until further notice, all such business centre counters are closed.

    See Titles Registry Alert No. 165 “Update - Novel coronavirus (COVID-19) - continuity of service” published here for more information.

  2. How can I lodge my documents?

    Lodgement of documents can be done through the post – we recommend by express post so that you are able to track its progress. All documents should be sent to GPO Box 1401 Brisbane 4001. You should retain a scanned copy for your records and take into account postal timeframes.

    Existing eLodgment and eConveyancing lodgement channels remain unchanged and are continuing to operate on a business-as-usual basis.

  3. Can I use Drop Box?

    In exceptional circumstances, a Drop Box facility is available. Please find below links for Drop Box lodgement instructions:

     
  4. Searches

    All property and title searches continue to be available online, over the phone and via email.

  5. What agencies can I use for e-settlements?

    Whilst QLS does not recommend or endorse any particular service, we understand the following provide e-settlement services which may assist you in the current circumstances:

    • SAI Global,
    • Globalx Legal,
    • LodgeX
    • InfoTrack, including SettleIt
    • Scott Ashwood,
    • City & Suburban,
    • Peter Atkinson.

    Practitioners can also register directly with PEXA or Sympli, the two approved service providers of eConveyancing subscription services in Queensland.  See below (under “Electronic options to support property transactions”) for more information about e-conveyancing, as well as the Business Queensland page, published by the Queensland Government.

    Practitioners intending to use an agent to conduct an e-settlement should consider getting their clients to sign an ARNECC Client Authorisation Form when completing VOI for their clients.

    Practitioners also need to be aware of the guidance published by the ARNECC “Guidance for e-Settlement Subscribers and their instructing practitioners” (available here).

  6. Do the current circumstances fall within the definition of a Delay Event in clause 6.2(8)(b)(iv)?

The Suspension of Time provision in the REIQ contract applies if a party is unable to perform a settlement obligation solely as a consequence of a Delay Event. Whether the clause applies to a particular situation will depend upon a construction of the clause in the context of the contract. Usually force majeure provisions are construed strictly.  

When advising a client you should keep in mind the following points:

  • The clause only relates to the inability of a party or their representatives to perform a settlement obligation (as defined), and not to other obligations or to dates for satisfaction of conditions; 
  • Settlement obligation is a defined term and is limited to the obligations to be performed at settlement. For a buyer this will be the payment of the balance purchase price on the day of settlement between 9am and 5pm and for a seller the delivery of the documents in clause 5.3(1) and vacant possession.
  • The definition of Delay Event does not specifically refer to a pandemic event;
  • The reference to an ‘act of nature’ may be construed by a court in the context of the other words ‘’tsunami, flood, cyclone earthquake, bushfire” as referring to some other form of natural disaster. . Alternatively, it may be construed widely to be any event arising as a result of a natural cause and without human intervention.  
  • As an alternative a Delay Event includes ‘compliance with any lawful direction or order of a government agency’. This may extend to the current direction by the Australian Government that a person must self-isolate if the person has COVID-19; has been in close contact with a confirmed case of COVID-19 or arrived in Australia after midnight on 15 March 2020. If a person is unable to leave their home due to compliance with such a direction and therefore unable to give vacant possession, a right to delay settlement may arise.
  • The Delay Event must be the sole cause of the inability to settle. Even if Delay Event is construed as including a pandemic event, there must be a connection between the pandemic and the inability to perform. 

You should consider the client’s specific circumstances to decide if a Delay Event is the sole reason a client is unable to perform a Settlement Obligation.

7. Will there be a standard “special condition" for the REIQ contracts? 

No.  The response of government authorities to the COVID-19 pandemic is changing daily.  There is no certainty about how long disruption to everyday business will continue.  In addition, every contract and clients’ circumstances are different and bespoke.  In light of the constantly changing environment, it is not appropriate or possible for QLS to provide a special condition or conditions which will provide certainty in every matter or suit the needs of every client. 

Practitioners are encouraged to work closely with their colleagues to ensure their respective clients’ interest are met throughout the transaction, particularly when government announcements are made at short notice which may affect a party’s capacity to meet certain conditions.

Treasurer’s determination under Corporations Act 2001 – execution of company documents and holding meetings

[5 May 2020] The Treasurer, Josh Frydenberg, has made a determination under section 1362A of the Corporations Act 2001 modifying the operation of provisions of the Corporations Act 2001, the Corporations Regulations 2001 and other specified rules.  This is a temporary modification of the operation of certain provisions and rules in response to the impacts of the coronavirus known as COVID‑19. The determination provides for:

  • using technology to give notice of meetings and to hold meetings, including by using technologies that “give all persons entitled to attend a reasonable opportunity to participate without being physically present in the same place”; and
  • authorises the execution of documents by a company in counterparts, including electronic or paper counterparts, subject to certain requirements.

The Corporations (Coronavirus Economic Response) Determination (No. 1) 2020 is available here. The instrument is valid for 6 months from 5 May 2020.

Commercial and residential tenancies

[28 May 2020] The Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Regulation 2020 was made and notified on 28 May 2020.  The Explanatory Notes are available here.  The purpose of the regulation is to mitigate the effect of COVID-19 and also specifically to give effect to the good faith leasing principles in the ‘National Cabinet mandatory code of conduct—SME commercial leasing principles during COVID-19’.  The regulation is intended to provide relief to parties to an “affected lease” by way of a number of measures, including guiding rent reduction negotiations, providing a moratorium on evictions for non-payment and access to a dispute resolution process specifically designed for small business tenancy disputes and affected lease disputes. 

The regulation confers responsibility for the dispute resolution process on the new Small Business Commissioner, created under the COVID-19 Emergency Response Act 2020.  Visit the Office of the Small Business Commissioner website for more information about small business leasing advice and dispute resolution assistance. 

QLS has also published a short ‘explainer’ video on the QLS Facebook page about the regulation.

 

[30 April 2020] QLS has prepared a Frequently Asked Questions document for our members on the recent changes to residential tenancies in Queensland, as outlined below.  The material and information in this document does not constitute legal advice.  QLS members are reminded that you can contact the Solicitor Assist program for free legal advice. 

 

[28 April 2020]  The Queensland Civil and Administrative Tribunal has issued new practice directions.  The purpose of Practice Direction No. 6 of 2020 is to provide for the process for all Minor Civil Dispute Tenancy applications to which the Residential Tenancies and Rooming Accommodation (COVID-19 Emergency Response) Regulation 2020 applies.  A minor amendment has also been made to QCAT Practice Direction No. 3 of 2020 to reflect that Practice Direction No. 3 does not apply to Urgent Minor Civil Dispute Tenancy Matters to which the Residential Tenancies and Rooming Accommodation (COVID-19 Emergency Response) Regulation 2020 applies.  Summaries of the changes can be found on the QLS Courts, Commissions, Tribunals, Titles and Property page and the full details can be found on the QCAT website.

 

[27 April 2020] The Queensland Parliament has passed emergency legislation and regulations in relation to commercial and residential tenancies.  The COVID-19 Emergency Response Act 2020 was passed on 22 April 2020 and received assent on 23 April 2020. The Act has a sunset clause, and is due to expire on 31 December 2020.

The emergency legislation primarily establishes powers to make regulations on a wide range of issues, including authorising regulations with retrospective operation. You can read more about the emergency legislation on the QLS First Reading blog here.

  • See the explanatory notes to the Act here
  • See the explanatory speech in Hansard here

Read on for further details on the changes for residential and commercial tenancies.

Emergency legislation and residential tenancies:

The Residential Tenancies and Rooming Accommodation (COVID-19 Emergency Response) Regulation 2020 was notified on Friday 24 April 2020. The explanatory notes for this regulation are available here. Certain provisions have retrospective operation dating back to 29 March 2020, as outlined in section 2 of the Regulations. This includes a moratorium on evictions.

On Friday April 24, the Government also released the Residential Tenancies Practice Guide, which provides a guide for negotiating arrangements for residential tenancy agreements, including rooming accommodation agreements, for people impacted by the COVID-19 pandemic, in light of the new Regulations.

More information about the release of the Practice Guide can be found in this Queensland Government media release (Friday 24 April 2020). Further resources can be found on the Residential Rental Hub online.

Emergency legislation and commercial tenancies (retail leases and other prescribed leases)

Part 5 of the COVID-19 Emergency Response Act 2020 will facilitate implementation of the National Cabinet decision in relation to good faith leasing principles for relevant non-residential leases in Queensland. As at 28 April 2020, no relevant regulations on this have been notified.

Part 6 of the Act also provides for the establishment of a temporary Queensland Small Business Commissioner (Small Business Commissioner) to deliver expanded advocacy functions for Queensland small business and administer mediation services in relation to small business tenancy disputes.

For further background information regarding these changes, see page 2 of the Explanatory Notes to the Act. Further information regarding the Small Business Commissioner specifically can also be found in this Queensland Government media release (Thursday 23 April 2020).

 

[9 April 2020] The Queensland Government has announced protection measures for both retail and commercial tenants and residential tenants and owners.

The retail/commercial measures include:

  • commercial and retail tenants to be protected from evictions, to be underpinned by new laws  
  • a three-month rebate of land tax for 2019-20, followed by a three month deferral of land tax 2020-21 for property owners who agree to provide rent relief for tenants affected by the coronavirus downturn (further eligibility criteria apply) – from 14 April 2020, you can apply for land tax relief by going to qld.gov.au/landtax
  • commitment to the SME Leasing Principles During COVID-19 as outlined in the National Cabinet Statement regarding the Mandatory Code of Conduct

The residential measures include:

  • the freeze on evictions as announced in the National Cabinet decision, to be retrospective as of Sunday 29 March 2020
  • the launch of an online rental hub at www.covid19.qld.gov.au/the-hub to provide all of the information and resources to support discussions between property owners and renters
  • for landlords and tenants who can’t reach agreement, there will be compulsory conciliation for COVID-19  related disputes between tenants and landlords through the Residential Tenancies Authority
  • rental support for tenants unable to access other financial support - new eligibility criteria is now in place for rental grants of up to four weeks rent, or a maximum of $2,000
  • implement legislative protections that would allow Queenslanders experiencing domestic and family violence to leave a rental property in a hurry, including immediate support to end tenancies quickly, change locks without seeking approval, access bond and separate from co-tenancies will be introduced

[3 April 2020] Australian Competition & Consumer Commission - Shopping centres to co-operate to support retail tenants

Shopping centre owners and managers have been granted interim authorisation to discuss and implement rent relief measures for small to medium shopping centre tenants facing hardship because of the COVID-19 pandemic.  This follows an application by Shopping Centre Council of Australia Limited (SCCA) and Scentre Group. The ACCC has allowed shopping centre owners and managers to jointly develop a plan to help their small business tenants, including franchisees and licensees, which have a turnover of up to $50 million pa. The plan could include an offer to defer or reduce rents and other payments, waive interest payments and extend leases. Read more here.

 

[29 March 2020] National Cabinet announced on 29 March 2020 that it has agreed to a moratorium on evictions over the next six months for commercial and residential tenancies in financial distress who are unable to meet their commitments due to the impact of coronavirus. National Cabinet also agreed to a common set of principles, endorsed by Treasurers, to underpin and govern intervention to aid commercial tenancies. Please see the media statement for more details.

 

Do I still need to attend conveyancing settlements?

[5 May 2020] - Yes. The Titles Office continues to receive documents. The Office of State Revenue is maintaining usual services. Social distancing restrictions announced by the Government in the Home Confinement, Movement and Gathering Direction (No 3) do not prevent settlements from occurring. Settlements are not restricted by the Non-essential business, activity and undertaking Closure Direction (No.8)

Lawyers should consider closely the provisions of any relevant contracts of sale to be satisfied that any delay or force majeure clauses have in fact been triggered by the current state of events. This includes understanding the consequences of the current directives issued by Government on social distancing and other health protection measures. For Lexon insured practices, see Lexon’s alert 7 of 19/20 dealing with Suspension of Time concepts in the REIQ contract. Lexon will be releasing further targeted tools.

At this time it is also important for solicitors to be mindful that they have an obligation to represent clients with contracts on foot and have a variety of alternate methods available to them to bring about settlements such as settlement agents, other firms as town agents, electronic conveyancing, settlement intermediaries and electronic lodgement with the Titles Office.  If a solicitor considers that there are circumstances where it is not possible for them to continue to represent a client, please contact the QLS Ethics and Practice Centre for guidance as to the way in which they should move forward with the client matter.

 

Australian Taxation Office - GST at settlement – what to do during COVID-19 closedown

The ATO has provided the following update about GST at settlement procedures during COVID-19 for buying or selling new residential property or land:

  • purchasers must continue to lodge GST at settlement forms, withhold and pay the required withholding amount at settlement
  • suppliers must continue to provide written notification to the purchaser if they have a withholding obligation or not and report the sales information in the period the sale was finalised even if their activity statement has a different due date.

If settlement has fallen through or the settlement date has been changed, please ensure you contact the ATO to cancel or amend your forms, see How to amend or cancel your forms.  
See also:

 To find more information about the relief options and measures available to you and your clients, see COVID-19.

 

FIRB - Changes to foreign investment framework

[24 April 2020]  Further information is now available on the FIRB website regarding temporary changes to the foreign investment framework previously announced by the Treasurer on 29 March 2020, to protect Australia's national interest while dealing with the economic implications arising from the COVID-19 (coronavirus).  The temporary changes will reduce the monetary screening threshold to $0 for all foreign investment. This means all proposed foreign investments into Australia subject to the Foreign Acquisitions and Takeovers Act 1975 (the Act) will require approval, regardless of value or the nature of the foreign investor.  For enquiries contact the Foreign Investment Review Board (FIRB) on +61 2 6263 3795 (weekdays 9am–12:30pm and 1:30pm-5pm) or email firbenquiries@treasury.gov.au

See also:

 

[29 March 2020] The threshold amounts which apply in determining whether particular foreign investments made on or after 10:30 pm (AEST) Sunday, 29 March 2020 are subject to Australia’s foreign investment framework are now $0, following the Treasurer’s announcement.  Changes were announced relating to monetary thresholds and timeframes for reviewing applications. Material on the Foreign Investment Review Board (FIRB) website is being updated to capture these changes.  In the meantime, please see the FIRB website summarising these changes, the Treasurer’s media release of 29 March 2020 and the FIRB media release for more information. 

 

Australian Banking Association – business loan relief measures extended

On 30 March 2020, the ABA announced that Australia’s banks will extend the six month deferral of loans to businesses with total business loan facilities of up to $10 million (up from the $3 million small business threshold).  The new opt-measures apply on the basis of certain conditions, including that for commercial property landlords, they provide an undertaking to the bank that for the period of the interest capitalisation, they will not terminate leases or evict current tenants for rent arrears as a result of COVID19.  See the ABA media release and ABA website for more details.

 

Titles Registry Alerts

Practitioners are encouraged to subscribe to the Titles Registry Alerts here, for the most up to date announcements from the Registry.

Titles Registry Alert No. 167 - Witnessing provisions during COVID-19 (3 April 2020)

On 3 April 2020, the Registrar issued Titles Registry Alert No. 167 “Witnessing provisions during COVID-19”.  With the current COVID-19 situation, the Registrar of Titles has provided some guidance on alternative witnessing provisions, taking effect from 6 April 2020, that can be used to assist in witnessing of documents, where document lodgement cannot be delayed. For example, where the transferor or mortgagor is in COVID-19 related self-quarantine or self-isolation. These alternative witnessing provisions “Effect of COVID-19 on the witnessing of Land Title Act, Land Act and Water Act Titles Registry instruments - New options for witnessing from 6 April 2020 until further notice” can be found here.  

Titles Registry Alert No. 166 - Electronic Titles Transactions (2 April 2020)

The Titles Registry has advised in its Alert No 166 (2 April 2020) that:

“In support of COVID-19 requirements, titles lodgement counters are currently closed, however, existing eConveyancing and eLodgement channels are open and continue to operate on a business-as-usual basis.  On Tuesday [31 March 2020], over 90% of all lodgements came through one of these two channels, and the documents were processed within our usual client service standards. If you are concerned about meeting ongoing business requirements in the current environment, then it is recommended that you consider subscribing to eConveyancing or eLodgement.”

More information about eConveyancing and eLodgement, including how to register and use these services, is available on the Business Queensland website.

Please also refer to the information below about “Electronic options to support property transactions".

 

Titles Registry Alert No. 165 - business centre counters closed from Tuesday 31 March 2020 (30 March 2020)

The Titles Registry has issued "Titles Registry Alert 165 “Update - Novel coronavirus (COVID - 19) - continuity of service as follows:

Effective from Tuesday 31 March 2020, Department of Natural Resources, Mines and Energy business centre counters are closed.  Existing eLodgment and eConveyancing lodgement channels remain unchanged and are continuing to operate on a business-as-usual basis.

Lodgements previously conducted outside Brisbane

Lodgement of documents can be done through the post, with no additional fees charged for this service. You are encouraged to avail yourself of this service. All documents lodged through the post are to be sent to GPO Box 1401 Brisbane 4001. 

Lodgements previously intended for 53 Albert Street Brisbane

Lodgement of documents can be done through the post, with no additional fees charged for this service. You are encouraged to avail yourself of this service. All documents lodged through the post are to be sent to GPO Box 1401 Brisbane 4001.

In exceptional circumstances, a drop box facility for documents is available to assist lodgers.

Please find below links to the Drop Box lodgement instructions and agreement and the credit card payment form as well as examples of how to complete them. 

Drop Box Lodgement Agreement Example.pdf.

cc-mail-payment-request.pdf.

Drop Box Lodgement Agreement.pdf.

Credit Card Payment Request Example.pdf.

This information will be available online.

Searches

Property and title searches continue to be available online at https://www.qld.gov.au/housing/buying-owning-home/property-land-valuations/property-search

Searches can also be ordered over the phone and via email or through our approved distributors. A list of distributors and other information regarding property and title searches can be found online at https://www.business.qld.gov.au/industries/building-property-development/titles-property-surveying/titles-property/searches-copies

The intention is, where possible, to continue to provide Titles Registry services within the context of government directives. Any further change in service delivery arrangements will be relayed to stakeholders through a further Titles Registry Alert.

Practitioners are encouraged to subscribe to Titles Registry Alerts on the Business Queensland website here.

 

Office of State Revenue

Practitioners are reminded that they can become a registered self-assessor with the Office of State Revenue.  This will enable you to stamp documents and lodge and pay transactions online using OSRconnect.  Further information about the registration process is available here.

OSR has advised that there is a 10-day service standard to process applications.  However, the average time for the Commissioner to decide the application is 6 business days, once all the required information has been received.  OSR often needs to seek additional information from applicants, which typically adds several business days to processing times. 

To progress these applications as quickly as possible, applicants can provide the following information at the time of making the application by emailing it to selfassessment@treasury.qld.gov.au:

  1. the position held (e.g. Director, Principal, etc) by the person making the application on behalf of the applicant;
  2. confirmation that the person making the application has the authority to make the application on behalf of the applicant;
  3. confirmation that the person making the application has read and understood the obligations of transfer duty self assessors (attached);
  4. details of the systems and processes that the applicant has in place to enable compliance with the lodgement, payment and endorsement obligations of a transfer duty self assessors (with reference to attached document).  For example, internal business process maps, procedure manuals for staff and/or equivalent process documents.  In the absence of any of these documents, a detailed written description of processes and procedures as they relate to the obligations of a transfer duty self assessor will be considered;
  5. the types of transactions that the applicant intends to lodge, in the ordinary course of business, with reference to this list of transactions that must be self assessed;
  6. confirmation as to whether the applicant would like to restrict registration to only those transactions identified by the applicant that they will process in the ordinary course of business (that is, those items selected from the list referred to in item (5) above); and
  7. the number of transactions the applicant anticipates lodging per annum.

The OSR team is ready to prioritise and process any increased volume of applications as quickly as possible. The entire process is electronic and expected to be maintained through OSR’s business continuity arrangements. 

 

Electronic options to support property transactions

Practitioners are reminded that where there are concerns or difficulties about physical attendance, the Business Queensland page, published by the Qld Government, offers information about the following options.

Electronic lodgement of title transactions (eLodgement) – for online lodgement of Titles Registry forms.

Electronic conveyancing which allows documents needed for property transactions to be digitally prepared, signed, settled and lodged.  Currently 2 approved service providers offer eConveyancing subscription services and practitioners should contact the providers for further information on how to subscribe and the transactions available:

Practitioners wishing to use electronic settlements must register their trust account with QLS.  Requests for approval must be in writing and addressed to the General Manager Regulation of QLS. Please see the “Guidelines for trust account operations” for Property Exchange Australia (PEXA) and Sympli Australia (Sympli) available on the QLS Resources webpage for the approval process and template application letter. 

 

SAI Global

On 27 March 2020, SAI Global confirmed that their settlement room is continuing to operate and that it is business as usual for their clients and new clients.  SAI Global has provided further information here about the measures they are taking in response to the COVID-19 impacts and to ensure the wellbeing of all is maintained.

 

Verification of identity

ARNECC (Australian Registrars National Electronic Conveyancing Council) has published the notice “Client Authorisation and verification of identity as a result of COVID-19”.  This notice provides guidance about the signing of Client Authorisations and the face-to-face identity verification regime as a result of the evolving situation concerning the COVID-19 outbreak.  Please check the ARNECC website for further updates.  

For Queensland Titles Registry requirements - the Queensland Titles Registry publishes the Land Title Practice Manual which details the required practice and procedures for industry practitioners when preparing and lodging Titles Registry forms.

Part 61-2700 sets out the Verification of Identity Standard which is substantially the same as the verification of identity standard in schedule 8 of the current Queensland Participation Rules for electronic conveyancing determined under section 23 of the Electronic Conveyancing National Law (Queensland). The current Queensland Participation Rules are available on the Electronic lodgement and conveyancing page available here.

 

Justices of the peace update

The JPs in the Community Program has been suspended until further notice to preserve the safety of the community and the volunteer JPs and Cdecs.  You can search for your nearest JP or Cdec in your local area if you or your clients urgently require a document to be witnessed.

 

Lexon updates

Lexon released a Critical Risk Alert on Friday 13 March 2020 which includes updates relating to the current pandemic, especially when managing time critical matters and service of documents with offices being closed as well as evaluating Cyber Risks when self-isolating.

The Alert also discusses aspects to be mindful of when drafting or reviewing conditions attached to contracts and considering limitation dates that may need to be extended as a result of the pandemic.

Also see Lexon’s alert 7 of 19/20 dealing with Suspension of Time concepts in the REIQ contract. Lexon will be releasing further targeted tools.

If your practice is insured with Lexon and you are not currently receiving these alerts, email uditi.desai@lexoninsurance.com.au to subscribe.