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Topic
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The long term Resident Owner of his Strata Titled unit in Sydney , NSW , died a little over 8 Months ago. His Levies for the Quarter he died during were paid. His Levies since that time have not been paid despite the Levy Notices being sent to his Solicitor , and reminder Notices being sent to his Solicitor. There is now almost 6 months of Levies overdue. He had no Relatives nor other Beneficiaries of his Estate in Australia. His Beneficiary Relatives are not Australian Citizens and live in their national home country overseas. His Residential Unit has now been advertised for Sale by Auction with a Sydney Real Estate Agent , and arranged by his Sydney based Solicitor.
Our Strata Manager informed our Executive Committee that the Levies are payable on the Property and not on the Deceased Estate , that is the Strata Manager stated the overdue Levies are to be paid by the next Owner of the Unit after it is sold/bought. We requested the Strata manager obtain Legal advice for us on this matter , however he insists the Levies are to be paid as he initially informed us.
It seems to us that it is unfair to expect a new Owner to pay Levies overdue on a property he/she did not own for the period of the Levies , and that a new Owner is likely to legally establish he/she is required only to pay Levies adjusted for from the Date of Purchase of the Unit { as did all other Owners here , myself included }.
We need to know who is liable to pay the portion of overdue Levies adjusted to the day before the date of new Owner purchase ?
If a claim has to be made on the Estate of the Deceased we will have to place that claim very soon , before the Unit is sold , because after the Sale the money will be sent overseas to where it will not be cost-effective to pursue a claim.
Do we have a Caveat placed on the Title of the Unit , or ?
Please can anyone advise what the legal situation is , or advise any Links to information about this matter ?
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My understanding is that regardless of how unfair it is, the debt moves with the lot & it’s up to the solicitor on the purchaser’s side to negotiate with the seller’s solictor & sort out all monies owing on the lot at time of sale. The section 109 certificate issued by the OC to the purchaser details any outstanding levies.
This may help:
With this warning: “If a levy is outstanding before the certificate is given and it is not shown on the certificate, the purchaser is not responsible for the payment.”
Our OC now has a process in place where we have a graduated response to overdue levies which ends in debt recovery with all costs directed to the debtor. Since we’ve brought in that process we’ve had very few problems with outstanding levies.
I agree with Tharra the debit belongs to the lot and if it is sold with levies outstanding then the new owner is liable for all outstanding debit and penalty interest if any.
Making sure their is no debit outstanding is one of the jobs of the buyers solicitor.
When we bought our unit there were levies and local rates due. We paid the purchase price and part of the job of our conveyancing solicitor was to deduct the levies and rates from the amount passed on to the previous owner. Then the levies and rates should have been paid from that residue.
The solicitor had done everything correctly and our file had two cheques sitting on it ready to pay rates and levies from the solicitor’s trust account. Just after the sale when through but before the cheques were mailed off the solicitor’s accounts were frozen and the solicitor hauled off for some sort of wrong-doing unrelated to our unit purchase. The consequence was that the rates and levies didn’t get paid until the law society or bar association or whoever had sorted out whatever the issue was with this solicitor.
Meanwhile, we had no money and were fortunate that the EC and the local government were generous in waiting a while for the matter to be sorted out. Eventually the guy’s accounts were unfrozen and the payments were made. it was clear though that the debt was associated with the unit (lot) and therefore us, not the previous owner. If things had dragged out longer we would have had to find the money to pay the debt and then try to get compensation from the solicitor.
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