The sale of rural property is exclusive.
There are a variety of key provisions which might be required which aren’t contemplated by customary REIQ contracts of sale that have to be addressed earlier than a contract is signed.
Examples of those embrace:
GST: It’s important that the right GST remedy for the sale of the land is decided, and that any pre-conditions for the appliance of the exemption have been met. A correctly drafted contract will permit the events to use the farm land exemption or, in sure circumstances, the sale of a going concern.
Water entitlements: Consideration needs to be given to any notices that are required to be lodged with the switch of the water entitlement, and ample time allowed underneath the contract to acquire these notices. It’s also essential to notice that water entitlements managed underneath a distribution operations licence require the vendor to offer the customer with a disclosure assertion previous to getting into into the contract.
Minister’s consent: The contract ought to present ample time to permit the events to acquire any related consent for the switch of property underneath the contract, if required.
Permits to occupy: As permits to occupy can’t be transferred, particular provisions have to be inserted into the contract for the give up of any present permits and software for a brand new allow by the purchaser.
Inventory and crops: The place inventory is included in a sale, the contract ought to embrace and obligation for the vendor to offer a nationwide vendor declaration (if required) and provision for cost of any levies related to the switch. It’s also frequent for events to agree who will probably be entitled to a selected crop however when settlement of the land will happen. This will necessitate early entry to the property by the customer, or entry by the vendor after settlement. In both situation, it’s important that the celebration’s proper to entry the property is retained.
Due diligence: With any acquisition it’s important for the events to conduct correct searches. As a result of nature of searches required for a rural property, these might take longer than conventional searches that might be undertaken on a industrial property.
Though not an exhaustive record, that is an instance of the issues which needs to be given earlier than getting into right into a contract of sale. Different property particular provisions resembling environmental components that are distinctive to the property (e.g. gasoline tanks, or cattle dips) and licensing necessities also needs to be thought-about.
- Kylie Wilson is a accomplice and Nicole Withers is a senior affiliate at Holding Redlich.