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Over the last 12 months two of the Lots in my Scheme have been sold. In neither case did I receive a Section 118 certificate advising the details of the new Mortgagee of the property. Having not received this and therefore being unable to record that information on the Strata Roll, the next time I need to do a Section 109 certificate on that Lot, I would be doing so without mention of a mortgage on the property and thus making a false declaration. Note: the notices referred to above refer to the NSW Act.
I have always assumed that the Solicitors involved in the settlement should provide that information as part of the settlement of the sale but one has told me that the new Mortgagee should be the ones to issue that. Who is right?
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SMIG – The S118 Notice is usually issued by the Solicitor / Conveyancer who’s acting for the purchaser, and amongst other things its purpose is to inform the Owners Corporation of who it is that’s entitled to a priority vote at General Meetings and whose details should be included on the Strata Roll.
The Secretary’s only obligation is to accurately record on the Strata Roll whatever’s shown on each properly authorised S118 Notice with regard to “the person acquiring interest”, and the “nature of (that) interest”; where in the last 8 years I’ve never received a Notice showing that person as being anything other than “owner”.
So if, like me, you’ve never received a S118 Notice from a mortgagee or covenant chargee, then like me you should just write “none shown” (on the strata roll) at Item 9 of the S109 Certificate/s that you provide.
If a mortgagee or chargee wants to have their interest in relation to a property recorded, it is up to them, not the owner. If they wanted to enforce their interest then they would be the ones taking action. In the absence of notice you are entitled to assume there is none.
In summary – what Whale said.
As is often the case with the Office of Fair Trading, its advice depends upon how you phrase the question and who’s providing the answer; contact them and ask the question again in the same way and I’ll bet you get a different interpretation.
As advised before, it’s the person or entity who wants their interest recorded on the Strata Roll that’s responsible for providing the S118 Notice, and in the case of the sale and transfer of title for a Lot that’s customarily the role of the Solicitor / Conveyancer acting for the (new) Owner.
As Secretary, you can request a S118 Notice from a person who you believe should provide one (and hasn’t), but beyond that you can only report what’s shown in your Plan’s Strata Roll, and if that’s incorrect or incomplete then let those acting for the Vendor and the Purchaser sort it out!
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