rural conveyancing
The issues included in rural conveyancing are numerous and varied. While rural conveyancing shares many features with its non-rural and metropolitan counterparts, certain aspects of an agricultural/farming lifestyle are distinct and need to be clearly understood in their own right.
Given the importance of the land to generating income, prospective buyers and vendors cannot be too careful when contemplating or undertaking a transaction. A solicitor should be employed from the outset and all relevant records of land use, title etc must be verified.
What follows is an overview of the important features of rural conveyancing.
Duty to Disclose and Pre-Contractual Negotiations
Generally speaking the onus is largely upon the purchaser to look out for their interests when undertaking a land transaction. While there are some obligations on behalf of the vendor that must be fulfilled, the purchaser must take care.
The purchaser does enjoy some protection against misrepresentation but remedies against disclosure are confined to a limited number of situations. The foundations of the relationship between vendor and purchaser are:
- In an ordinary situation, there is no fiduciary relationship between the parties when they are negotiating the terms of the contract
- There is no duty on either party to a contract for the sale of land to disclose to the other party all material facts of which he is aware and which materially affect the value of subject matter of the sale
- Silence by a vendor does not constitute fraud unless there is an active concealment of a defect
Pre-contractual enquiries largely concern the quality of the land that is the subject of the sale. The enquiries are restricted to topics that are not covered by other sources of legal regulation such as the contract for sale itself, the relevant statutory or common law or is outside the ambit of the vendor's duty of disclosure.
General information regarding a property can be acquired from Rural Lands Protection Boards and Agriculture NSW. This might include adverse matters and other notices. However in terms of more specific information, prospective purchasers should carefully inspect the property and list all relevant queries.
Some key enquiries that might be made regarding rural land in particular include the following:
- Chemical Residues – The presence of chemical residues in animal and plant products can have a major impact on profitability. Prospective purchasers should check land for typical sites of chemical disposal such as pesticide storage sheds, used drums or disposal sites etc – see Stock (Chemical Residues) Act 1975
- Livestock Diseases – Some livestock diseases might persist on contaminated land even when the property is de-stocked when sold, such as Johne's disease and anthrax. Protection zones are declared in some parts of NSW – see Stock Diseases Act 1923
- Plant Diseases and Pests – Vegetables, fruits, cereals and other crops can be affected by diseases. Protection zones exist in some parts of NSW such as for bunchy top bananas on the North Coast – see Plant Diseases Act 1924
- Noxious Weeds – Legislation makes the occupier of land responsible for the control of specified weeds such as Blackberry and Bathurst burr which can invade neighbouring properties affecting productivity. After the land is sold, the new occupies may also be bound by any previous notices and may be liable for outstanding costs – see Noxious Weeds Act 1993
- Noxious Animals and Insects – Land holders are required to actively control noxious animals such as rabbits, wild dogs and pigs – see Rural Lands Protection Act 1989
Land Use Planning
Aspects of agricultural land not governed by legislation may affect land suitability such as topography, climate, soils, water availability and natural vegetation. Infrastructure and other improvements such as road access, sheds, yards and fences, water and power supply are also important.
Vendor Statutory Disclosure
Under the terms of the Conveyancing (Sale of Land) Regulation 2000 prescribed documents are regulated.
It is essential that vendors realise how important it is to make to note whether they have received any Notices within the meaning of the Regulations pursuant to the Water Act, Stock Diseases Act, Stock (Chemical Residues) Act, Soil Conservation Act and Native Vegetation Conservation Act . If the vendor has received any of those notices and does not disclose them the result is a breach of warranty with all the consequences for either vendor or purchaser that flow from there.
Access
It is important to assess what access is legally available, especially regarding easements. It often occurs in rural conveyancing that what a vendor had always thought was legal access leading to his property was in actual fact access across a stock route or an easement running across neighbour's land.
Water Entitlements
It is essential that water entitlements be verified. Water licences and details pertaining to details of irrigation rights detail the amount of water that can be pumped for irrigation purposes and details of bores. Water is allocated over a 12 month period and may be carried over following sale of property. In cases such as these water rights can be sold.
Minister's Consent
A vendor must attach an application for Minister's consent when submitting a contract for sale of land. The vendor will be responsible for lodging the Minister's consent and pay the Minister's consent fee.
Relevant Authorities
The local council, Land and Water Conservation, Environment Protection Authority and other Government agencies control various aspects of rural land use covering areas as diverse as development and building approval; land clearing, irrigation; and intensive livestock production.
