There are many complex procedures that must be done correctly otherwise the sale or purchase of a home or property may turn into a drawn-out and costly process casting a big shadow over the dream.
One such procedure relates to any Trust Deeds that may be held over the property.
Conveyancing.com Managing Director and accredited business law specialist Jim Parke says this reason alone demonstrates why it is important to engage a property law specialist to carry out the conveyancing.
“Properties owned by trustees can create a level of complication that should only be dealt with by a lawyer,” Mr Parke says.
"Often the purchaser is not aware the property is owned by a trustee or at best has minimal knowledge of the consequences of this arrangement. This is further complicated when the transactions involve a financier, which is commonplace these days"
The concept of a trust has been around for centuries, but they became much more popular in the 1970s and 1980s when accountants deemed they provided tax advantages.
At the time this was deemed important as an asset protection measure and particularly as a tax-saving device by distribution of income within the family.
While this had since become much less popular due to changing tax regulations, Mr Parke said the implications of this trend had been coming home to roost in more recent times as these properties changed hands.
“Of particular concern is locating the Trust Deeds drawn up at the time the trust was arranged.
“A family discretionary trust typically consisted of a Trust Deed with the trustee powers set out in standard form along with a schedule setting out the particulars relevant to the trust.”
Mr Parke says as many of these documents were purchased ‘off the shelf’, little regard was generally given to trust law.
Four copies of the deed were usually executed but, he says, this process was not always administered as carefully as it should have been and now, 40 or 50 years along, problems are arising when the original documents cannot be located.
“The purpose of the deed documents was to record the trustee as the legal owner of assets, both real estate and personal property such as bank accounts and shares.
“When it comes time to deal with these assets, the deed establishing the trustees’ right to deal may need to be produced.”
Conveyancing.com is a responsive conveyancing website operated by skilled and experienced qualified property law experts and backed by the considerable strength of a recognised, highly regarded law practice.
“The complexities surrounding Trust Deeds demonstrate why the conveyancing process should be entrusted to a professionally trained legal professional who can offer legal advice and provide legal solutions to all property transactions,” Mr Parke said.
Need further information or legal advice? Speak with the team at Conveyancing.com. Ask a property lawyer.