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The State Government has announced changes extending and expanding the off-the-plan duty concession.  The changes apply to transactions entered into from 21 March 2025.  Summary of changes An increase to the value of homes and vacant land that are eligible for no transfer duty or a reduced rate of duty. For off-the-plan duty concessions: an extension of the eligible contract dates until 30 June 2026; an increase to the value thresholds for pre-construction and under construction contracts; expanding the concession to purchases of single-tiered strata or community titles (building) scheme dwellings (but not a survey-strata scheme).  When? RevenueWA anticipates implementing changes to apply the new rates in early May 2025 for the first home owner rate of duty and in late June 2025 for the off-the-plan duty concession. Transactions that are eligible for a reduced amount of duty but settle before the changes can be applied may be reassessed for a refund of duty after settlement.  Quick reference guide   Increase Previous Purchase of vacant land No duty is payable on land valued up to $350,000 $300,000   The value of the land must not exceed $450,000 $400,000   If the dutiable value is between $350,000 and $450,000, duty is payable at a rate of $15.39 for every $100, or part of $100, by which it exceeds $350,000.    Purchase of a home No duty is payable on homes valued up to $500,000. $400,000   The value of the home must not exceed $700,000 for properties located in the Perth Metro and Peel regions. $600,000   If the dutiable value is between $500,000 and $700,000 in the Metro or Peel regions, duty is payable at a rate of $13.63 for every $100, or part of $100, by which it exceeds $500,000.  $600,000   The value of the home must not exceed $750,000 for properties located outside these regions. $600,000   If the dutiable value if between $500,000 and $750,000 outside the Metro or Peel regions, duty is payable at a rate of $11.90 for every $100, or part of $100, by which it exceeds $500,000.   $600,000 Off-the-plan purchases (pre-construction) No duty is payable on properties valued up to $750,000. $650,000   The 100% duty concession reduces to 50% for properties valued between $750,000 and $850,000. $650,000 - $750,000   The 50% duty concession applies to properties valued over $850,000. $750,000 Off-the-plan purchases (under construction) A 75% duty concession applies to properties valued up to $750,000. $650,000   The 75% duty concession reduces to 37.5% for properties valued between $750,000 and $850,000. $650,000   - $750,000   A 37.5% duty concession applies to properties valued over $850,000. $750,000 Off-the- plan purchases (strata scheme or community titles)   Concessions will be expanded to off-the-plan purchases of all strata scheme or community titles (building) scheme dwellings including townhouses and villas, not just multi-tiered schemes.  This does not apply to the construction of a dwelling on a survey-strata plan.

The ban From 1 April 2025 to 31 March 2027, foreign persons (including temporary residents and foreign-owned companies) cannot apply to buy an established dwelling in Australia unless an exception applies.  A review will be undertaken to determine if the ban should be extended beyond 31 March 2027. Why? The ban is said to respond to housing challenges facing Australians who will be able to buy homes that would otherwise have been bought by foreign investors whilst encouraging foreign persons to boost Australia’s housing supply. Previous position Until now, foreign investors have generally been barred from buying existing property except in limited circumstances.  The previous rules already limited classes of foreign buyers to, for example, temporary residents (or their spouses) acquiring an established homes to use as their place of residence whilst in Australia or buyers planning to redevelop a dwelling where the redevelopment would genuinely increase Australia’s housing stock. Exceptions to ban Limited exceptions to the ban include investments that significantly increase housing supply or support the availability of housing supply, and for the Pacific Australia Labour Mobility (PALM) scheme.  Other existing exceptions remain in place, such as for purchases by: permanent residents New Zealand citizens spouses of Australian citizens, permanent residents, or New Zealand citizens (when purchased as joint tenants). Enforcement The ATO’s foreign investment compliance team will enforce the ban and enhance screening of foreign investment proposals relating to residential property.  Tough enforcement action is said to be proposed for any non‑compliance. Land banking Alongside the temporary ban on foreign purchases of established dwellings, to ensure that vacant land is put to productive use within reasonable timeframes, foreign investors will be subject to development conditions when they acquire vacant land in Australia.

Introduced in 2016, the Foreign Resident Capital Gains Withholding ( FRCGW ) rules aim to ensure appropriate tax is withheld by purchasers or lessees of taxable Australian property. Significant changes have been made to the FRCGW regime, with withholding rules now applicable to all property sales.  Previous regime Previously, to avoid having 12.5% of the of the value of the property withheld, Australian residents selling property valued at $750,000 or more needed to obtain and provide to the purchaser, at or prior to settlement, a Clearance Certificate from the Australian Tax Office ( ATO ) confirming their status as an Australian tax resident.  Major changes Now, for contracts for sale entered into on or after 1 January 2025: 1. the withholding rate has increased from 12.5% to 15%; and 2. the $750,000 property value threshold will be removed. In other words, all Australian residents selling property must now obtain a Clearance Certificate from the ATO to avoid withholding.  Why change? Changes are intended to address Treasury’s concerns that the previous FRCGW rate did not collect enough tax to keep up with the Capital Gains Tax that should be collected on the disposal of foreign-held Australian property, particularly due to the appreciation in value of Australian real property in recent years.   Applying for a Clearance Certificate Whilst most Clearance Certificates are issued within a few days, some can take up to 28 days.  Clearance Certificates are valid for up to 12 months, allowing sellers to obtain them early.  Clearance Certificate is not obtained If a Clearance Certificate is not provided by settlement, the purchaser is required to withhold 15% of the sale price and remit it to the ATO.  If an amount is withheld, the seller will only receive a refund after their next income tax return is processed. Foreigners Foreign resident vendors or lessors cannot obtain a Clearance Certificate.  However, they may continue to apply for an ATO variation to reduce the FRCGW rate, potentially down to 0%, if they can demonstrate that the prescribed 15% rate is excessive.

In response to the 2019 Parliamentary Inquiry “Levelling the Playing Field: Managing the impact of the rapid increase of short-term rentals in Western Australia” , the State Government has introduced initiatives to better regulate the STRA sector, including through the launch of a registration scheme for STRA providers. Key points The STRA Register opened on 1 July 2024. From 1 January 2025, registration is mandatory for all STRA premises. Registration is for 1 year from the date of registration. Fees apply to registration.  Fees are waived for those that register their STRA premises by 1 December 2024. From 2 December 2024, registrations will be subject to a $250 application fee. Renewal is required every 12 months.  The fee to renew every 12 months is $100. What is Short-Term Rental Accommodation? STRA is the collective name given to premises offered for short-term letting, often through an online booking platform or management agent.  STRA is either hosted (where a permanent resident is present) or un-hosted (where guests have exclusive use of the entire premises). Popularity STRA has developed in response to the way we travel and book accommodation.  The success of online booking platforms offering STRA has seen a rapid increase in short-term rentals, with high concentrations occurring in popular tourist locations.  Demand can also be high in localities attracting non-tourism related travel, such as medical, education and business travel. Types of properties STRA usually includes properties that have not been developed for traditional accommodation purposes and can include a family holiday home periodically offered as a short- term rental, a property purchased for the sole intent of operating as STRA or a spare bedroom and area within a home, offered to let on a short- term basis. STRA Register Under the Short-Term Rental Accommodation Act 2024 (WA), all providers of STRA within WA, both hosted and un-hosted, will be required to register their property by 1 January 2025 Aims of the Register The register is an initiative to gather information on the STRA sector in WA to   enable data driven decision making, provide the community with information about what STRA exists in their area and ensure providers are aware of local laws and planning controls.  Who must register? Registration is mandatory for all STRA premises (both hosted and un-hosted) that are rented for less than 3 months.  Registration number Once registration is completed, a STRA Registration number is issued for display in a visible location on the advertisement for the STRA premises. What data does the Register collect? The STRA Register will capture the number of nights a registered premises is booked for STRA.  If the premises is advertised on a booking platform (eg: Airbnb) these platforms will automatically populate the Register with the bookings taken for the premises.  If bookings are managed independently, information will need to be entered manually into the Register for each booking. If you don’t register? If a provider fails to register their STRA, they will not be able to advertise or take bookings for the premises from 1 January 2025.  If a provider is found to be operating STRA without registration, they may be liable for significant penalties. Exclusions Categories of STRA specifically excluded from the requirement to register including hotels, motels, serviced apartments, tourist developments and caravan parks.

In a challenging rental market (vacancy rates are 0.6%), an increasing number of WA tenants see their rental property as their long-term home.  The next phase of Cook Government amendments to the Residential Tenancies Act 1987  (WA) is geared toward strengthening rights and providing more stability and certainty to tenants.  Increasing rent   As of 29 July 2024, rent increases will only be allowed once every 12 months.   What does this mean?   Periodic agreements  – a minimum 12-month period between rent increases will apply from 29 July 2024, regardless of when the agreement was signed. Fixed term agreements – signed on or after 29 July 2024, a minimum 12-month period between rent increases will apply from 29 July 2024. Fixed term agreements – signed before 29 July 2024, a minimum 12-month period between rent increases will apply once the current fixed term ends.   To increase rent, the prescribed Notice to Tenant of Rent Increase (Form 10) must first be issued to tenants giving at least 60 days’ notice of the rent increase along with details of the amount of increase and the day it will take effect.    NOTE: there is still no cap on how big increases can be, however, a tenant can apply to the Magistrates Court to argue against a proposed increase.   Keeping pets   Tenants can keep a pet, with permission from the landlord. Tenants will need to fill in the prescribed Pet Request Form (Form 25).  To refuse consent:    Without application – landlords will be permitted to refuse consent without applying to the Commissioner for Consumer Protection where keeping the pet would contravene a written law, local law or scheme by-law.  With application  – landlords may make an application to the Commissioner for Consumer Protection to refuse consent if: The premises are unsuitable for keeping the pet. There is an unreasonable number of pets being kept at the premises. Keeping the pet is likely to cause the landlord undue hardship. The pet is a “dangerous dog” as defined in the  Dog Act 1976  (WA). The pet is likely to cause damage to the premises that could not be repaired for less than the amount of the security bond.   A landlord can impose reasonable conditions when agreeing to allow a tenant to keep a pet at the premises:   Without application – Landlords can set the following conditions without Commissioner approval: Limiting the number of animals at the premises (eg: no more than two pets).  Cleaning, maintenance and fumigation at the end of tenancy. With application  – If the landlord wants to add any other conditions, they must be approved by the Commissioner, such as: A pet must stay outside. A bird must be kept in a cage.   NOTE:  a pet bond must not exceed $260, no matter how many pets a tenant has.  Presently, the pet bond can only be used for pest control (fumigation).  In 2025 this will expand to cover damage caused by pets.  The security bond can also be used to cover cost of cleaning and damage caused by a pet.   Minor modifications  A tenant will be able to make minor modifications to a premises, with the landlord’s permission using the Minor Modification ( Form 26).  Consent may be refused where:   The modification will disturb asbestos.  A law or strata rule prevents the modification. The home is heritage listed. In seeking to refuse consent on other grounds, a landlord will need to make an application to the Commissioner for Consumer.  This may be in circumstances where the modification may:     Result in additional maintenance costs to the landlord. Would make the premises unsafe. The action required to reverse the modification is not reasonably practical.   Landlords may also impose “reasonable conditions” on making certain categories of modifications (eg: work must be undertaken by a qualified person).   NOTE: the tenant will be required to “make good” the modification at the end of a tenancy by either restoring the premises to the same condition immediately before the changes were made (allowing for fair wear) or pay an amount equal to the reasonable cost of restoring the premises.

There has been much discussion surrounding WA’s new Aboriginal Cultural Heritage Act 2021 (WA) (Act) which came into effect on 1 July 2023. Confusion and uncertainty arising from the new Act – meant to “clean up” previous heritage laws from the 1970’s – has resulted in calls for over-arching reform at a federal level to override the Act. In the meantime, the new Act subsists. A cause for concern? Perhaps not Landowners must remember that for more than 50 years it has been illegal to undertake activities that may harm Aboriginal cultural heritage, without approval. Critically, where there is NO Aboriginal cultural heritage present, there is NO requirement for approval. Further, substantial exemptions exist, including for activities on properties less than 1100sq metres. Even for low level activities (with no or minimal ground disturbance) if harm can be minimised, approvals are not required. And for farmers, “like-for-like activities” (such as building fences or planting crops on existing farms) are also exempt. The new system The new Act is meant to provide a legal framework to modernise Native Title laws through the introduction of a permit-based system that categorises activities, introduces practical exemptions and sets tiered approvals that align with the level of disturbance and risk of harm to Aboriginal cultural heritage. When approval is required There is only a need for approval where Aboriginal cultural heritage is present in the area, and it is not possible to avoid impact or harm. If present, your activity may require a permit, or may require consultation or an agreement with the local Aboriginal people.  A free “ACHIS” search is available via the Department of Planning, Lands & Heritage. What type of approval do I need The type of approval needed is based on the level of your activity, the scale of disturbance and the potential to impact Aboriginal cultural heritage. A tiered system is in place to help identify what you need to do and what type of approval may be required. Some activities are exempt. · Exempt – activities do not require approval · Tier 1 – activities do not require approval · Tier 2 – activities require a permit · Tier 3 – activities require a management plan Exempt – minor activity (no approval) A range of activities undertaken by landowners, farmers, the community and industry are exempt from requiring approval under the Act. Some exemptions include: · Residential development on land less than 1100sqm. · Installing and maintaining residential water, gas, electricity and other services. · Installing a patio, pergola, verandah, deck, pool or deck on residential properties. · Undertaking “like-for-like" activities eg: farmers working on established paddocks. · Maintaining existing firebreaks or additional firebreaks in the event of an emergency. · Ploughing, running livestock, replacing a fence or seeding an existing paddock. · Recreational activities on public waters and in public places. · All activities, including existing mining activities, approved under the prior act. Tier 1 – low amount of activity (no approval) Where there is no or only a minimal level of ground disturbance but where there is a risk of harm to Aboriginal cultural heritage, the activity may proceed subject to a requirement to undertake all reasonable steps possible to avoid or minimise harm to Aboriginal cultural heritage. Tier 1 activity would include installing a fence in a way that does not involve clearing is a Tier 1 activity and does not need approval. Tier 2 – medium activity (permit required) For activities involving low-level ground disturbance, the Act establishes a permit system based around due diligence and application to the Aboriginal Cultural Heritage Council. Tier 2 activities include erecting or installing a stock watering point or a yard, amalgamating lots or constructing villa style housing. A nominal $100 administrative fee applies for a permit. Tier 3 – high level of activity (management plan required) Activities that involve moderate to high level ground disturbance will require an Aboriginal Cultural Heritage Management Plan to be negotiated with the relevant Aboriginal parties. Tier 3 activities include digging a new mine site, deep excavation or land clearing, subdivisions or major construction projects. A scalable system of fixed and variable application fees applies for moderate to high ground disturbing activities. Due Diligence Assessment Before commencing any application, a Due Diligence Assessment is required in order to assess the risk of harm to Aboriginal cultural heritage. This will enable a proponent to determine how to proceed in relation to an activity. The Assessment will reveal if the activity is in a “Protected Area”, whether the activity should be carried out in an alternative location or using an alternative method, and what sorts of authorisations may be required. Do you have questions? · Is Aboriginal Cultural Heritage present on my land? · How do I undertake Due Diligence? · Does my activity require approval? · How do I determine whether my activity is exempt? · How long does it take to obtain a permit? · What are the fees for a permit or management plan?

After more than a decade since the last review of WA tenancy laws, major amendments are being made to the Residential Tenancy Act 1987 (WA) (RTA). A lot has changed during this time. The supply of housing has not kept up with demand. Labour and material constraints have resulted in delays in new home builds. Low vacancy rates combined with soaring rent increases have created tough market conditions for tenants. For owners, climbing interest rates and regulatory changes have caused them to leave the rental market. Tenants are seeking security of tenure. Overview of reforms The reforms to the RTA are made with a view to strike a balance between protecting an owner’s investment property whilst providing stability for tenants. The amendments will be implemented in phases. The most significant phase 1 reforms will: · prohibit “rent bidding” in WA · reduce the frequency of rent increases to once every 12 months · allow tenants to make minor modifications to rental properties · allow tenants to keep pets at rental properties · streamline the release of security bonds at the end of a tenancy · refer certain disputes to the Commissioner for Consumer Protection Prohibition of “rent bidding” Rent bidding is where prospective tenants offer an amount over and above the advertised price for a rental property, with the aim of being selected as the preferred tenant. Amendments to the RTA will see the practice curtailed, with properties being advertised for a fixed amount. Similarly, agents must not solicit or otherwise invite an offer of rent higher than the advertised amount. Whether the changes will also apply to private landlords or unsolicited offers from a prospective tenant remains to be seen. Limiting rent increases Presently, the RTA allows for rent increases to occur at six monthly intervals (if tenants are given at least 60 days’ notice and in the case of a fixed term tenancy, where the agreement specifies the amount of the increase or a method of calculation). However, proposed amendments provide for the frequency of rent increases to be reduced to once every 12 months (although, there would not appear to be a cap on how big those increases could be). This would bring WA in line with the approach taken in other jurisdictions. Keeping of pets For tenants who want to keep pets, the RTA presently requires permission from landlords (who can refuse a request without explanation). Tenants have no further recourse if the request is refused. Where permission to keep a pet is granted, lessors have the right to seek a pet bond (if the pet can carry parasites that can affect humans). Proposed amendments allow for tenants, in most cases, to keep pets at rental properties where they first seek permission. Landlords will only be able to refuse with the consent of the Commissioner for Consumer Protection and only when it is reasonable to do so. Landlords can, however, negotiate reasonable conditions for keeping a pet on the property. Minor modifications Under the current RTA, landlords can either prohibit a tenant from making alterations or affixing fixtures to rental properties, alternatively, allow modifications with consent. Proposed changes will allow tenants to have greater freedom to make minor modifications (eg: hanging hooks or pictures on a wall) without having to seek the consent of landlords. However, tenants should be aware that they may be required to restore the premises to its original condition at the end of the tenancy. Under the changes, tenants would also be entitled to make other (as prescribed by regulations) modifications with landlord consent. If consent is withheld, landlords must obtain an order from the Commissioner for Consumer Protection confirming that it would be unreasonable to make the modifications. Security Bond Bond disputes contribute significantly to the Magistrates Court’s caseload (affecting timeliness of other residential tenancy matters). Presently, the Bond Administrator may only dispose of a bond if the parties have agreed the amount or there are court orders providing the amount. The implementation of a more effective process for disposal will allow a tenant or landlord to apply either unilaterally or via joint agreement to the Bond Administrator for release of the security bond. The Bond Administrator will then seek the views of all other interested parties before release. In the absence of a response, or if the parties agree to the original claim, the Bond Administrator would dispose of the bond. If the claim is disputed, then dispute resolution would be undertaken between the parties. Dispute resolution Presently, residential tenancy disputes are heard exclusively by the Magistrates Court. Concerns have been raised about the length of time taken for some matters to be resolved, the absence of written reasons for decisions (creating the perception of limited transparency and consistency of decision making) and the stress and inconvenience of attending court hearings. Proposed changes will see some disputes (over bond payments, pets and minor modifications) referred instead to the Commissioner for Consumer Protection for determination. The remainder of residential tenancy disputes would continue to be heard in the Magistrates Court. The aim of this shift is to provide an accessible system that is fast, fair, cost effective and, where possible, maintains constructive relationships between parties. “Without grounds” terminations At this time, it does not appear that changes will be made to the “without grounds” termination provisions in the RTA. The current provisions of 60 days’ notice for periodic leases and 30 days’ notice for fixed leases, at this stage, remains. When are changes coming? Following the publication of the Decision Regulatory Impact Statement by the Department of Mines, Industry and Safety (providing recommendations in relation to amendments to the RTA following stakeholder consultation), the process for drafting phase 1 changes has now commenced. When the legislation will be enacted, however, remains to be seen.

Duplicate Titles have been a feature of the Titles Register since its inception in 1875. Where there is one issued, a Duplicate Title is a paper version of the corresponding original Certificate of Title, with some differences and limitations. Limitations Many people may not be aware that Duplicate Titles have a number of limitations. For example, caveats, memorials, notifications and property (seizure and sale) orders have never appeared on Duplicate Titles such that they do not give a true indication of the encumbrances on a parcel of land. Removal One of the key changes brought about by the Transfer of Land Amendment Act 2022 (amending the Transfer of Land Act 1893) is the removal of “paper” Duplicate Titles from the land conveyancing process in Western Australia. Why? Interestingly, Duplicate Titles have been optional since 1996. WA has been transitioning to this point for a long time. Finally removing Duplicate Titles will clarify and simplify conveyancing in a way that does not detract from the integrity and security of the WA land Register. The change also aligns WA with ongoing advancements in electronic conveyancing around Australia. What to do with your existing Duplicate Certificates Duplicate Titles that existed before Monday, 7 August 2023 are automatically rendered invalid. They DO NOT need to be returned to Landgate or destroyed. Practically, what does this mean? From Monday, 7 August 2023, anyone with a Duplicate Title need NOT take any action. There is NO change to the way registered proprietors, encumbrances and other interests in land are recorded and searched on Certificates of Titles in the land titles Register. Land transaction documents which have been lodged with Landgate, but which remain unregistered by close of business on Friday, 4 August 2023 will not be able to create or issue Duplicate Titles. In the meantime Until Monday, 7 August 2023, registration requirements continue to apply for all documents lodged until the changes take effect. However, with Duplicate Titles no longer having any legal effect on and after Monday, 7 August 2023, Landgate recommends NOT lodging applications to replace lost Duplicate Titles or Applications to issue Duplicate Titles leading up to August UNLESS required for a land transaction or settlement taking place on or before Friday, 4 August 2023. Keepsake? Landowners can retain Duplicate Titles as a historical keepsake if they wish.

So you have entered into a contract for sale of land (Contract) in Western Australia. Congratulations! But what next? This article sets out some of the matters to consider when buying and selling land in Western Australia. Appoint a settlement agent or lawyer In Western Australia, only a licenced settlement agent or lawyer can act for you in your conveyance of land. The main difference between employing a settlement agent as opposed to a lawyer is that a lawyer is able to give you legal advice, whereas a settlement agent cannot. For a buyer, we suggest appointing a settlement agent or lawyer as soon as possible after entering into the Contract. For a seller, you could wait until the Contract is unconditional, but there is no harm in appointing a settlement agent or lawyer immediately after entering into the Contract. Pay the Deposit If you are the buyer, don’t forget to pay the deposit as required by the Contract. For example, the Contract may require that the deposit is due to be paid to the seller’s real estate agent within 5 days after the contract date (being the date on which the last party to sign the Contract, signs it). Contact your bank If you are buying the property with the help of a bank or if the seller has a property which is encumbered by a mortgage, we suggest contacting your bank as soon as possible to let them know about the purchase or sale. If you are the buyer and the offer is subject to finance approval, we suggest contacting your bank as soon as the property is under contract. Your bank will usually ask that you complete a loan application form or similar to kickstart the finance process. If your application is approved, your bank should provide you with a letter of approval. If your application is not approved, you bank should provide you with a letter of non-approval. In both cases, you should provide the letter of approval or non-approval to your settlement agent or lawyer. If you are the seller, then after the Contract becomes unconditional (which might be immediately after entering into the Contract or later if the Contract is subject to finance) then usually you would need to complete a discharge authority form and lodge it with your bank. Transfer duty Transfer duty is imposed upon agreements to transfer land in Western Australia. It is the buyer’s obligation to lodge the dutiable instrument (usually the Contract) with RevenueWA and then once assessed for duty, it is the buyer’s liability to pay the duty. Your settlement agent or lawyer should guide you in relation to transfer duty lodgement and payment. Don’t forget to include transfer duty when calculating how much you will need at settlement, eg if the purchase price is $450,000 then transfer duty (at the time of this article) is an additional $15,390.00 unless you are a first home buyer, in which case transfer duty could be reduced to $3,838.00 (being the first home owner rate of duty). If you are a foreign buyer, then you may need to pay an amount additional to the transfer duty. Try our Settlement Costs Calculator here to estimate the amount of transfer duty payable. First home owner grant (FHOG) If you are a first home owner, you may qualify for the FHOG (currently $10,000) if you are purchasing or building a new home. If you receive the FHOG you may also be eligible for the first home owner rate of duty (see the above example first home owner rate of transfer duty). Foreign resident capital gains withholding clearance certificate If you are an Australia resident and you sell property for $750,000 or more, then you may need to obtain a Foreign resident capital gains withholding clearance certificate from the ATO. Failure to obtain a clearance certificate may mean that the buyer is required to withhold a portion of the purchase price (currently 12.5%) and pay it the ATO. You can apply for a clearance certificate from the ATO by using this link. We suggest that the seller seek a clearance certificate as soon as possible to allow for ATO processing times. Festive season With the festive season upon us, please allow for additional processing times (as some organisations close over the Christmas – New Year period) and the statutory holidays when calculating contract deadlines. If you have any questions in relation to buying or selling land in Western Australia, please contact us here.

Lessees have an interest in the land leased pursuant to the lease. But is that leasehold interest guaranteed? Well, the answer is maybe. This article discusses what happens to unprotected leases, when you should protect a lease and how to protect a lease. Primewest In Primewest (Mandurah) Pty Ltd v Ryom Pty Ltd as trustee for Golden Asset Pty Ltd [2012] WASC 443 (Primewest) it was held that an unregistered lease for a term which exceeds five years is destroyed upon the transfer of the freehold property to a third party. Primewest considered section 68 of the Transfer of Land Act 1893 (WA) refers to the paramountcy of the estate of the registered proprietor, ie the registered proprietor holds the land free from prior unregistered interests. There is an exception in section 68(1A) for leases. The exception is for: “any prior unregistered lease or agreement for lease or for letting for a term not exceeding 5 years to a tenant in actual possession”; and “such lease or agreement is registered or protected by caveat”. For example, if a lease term is 4 years long and the lessee is in actual occupation, then it will be protected by section 68(1A). Alternatively, if the lease term is 7 years long and is registered or protected by caveat, then the lease will be protected. However, if the same lease is neither registered nor protected by caveat, then as contemplated in Primewest, the lease will be destroyed upon the transfer of the freehold property to a third party. How to protect your leasehold interest? If a lease is registerable, then our recommendation is to always seek to register leases. Registration of a lease will require the consent of all relevant interest holders and will therefore validate the lessee’s leasehold interest. However, if registration is not possible, then a lessee is free to register its leasehold interest on the title by way of caveat. Even if the term of the lease triggers the protection under 68(1A), a lessee may nonetheless choose to register a lessee caveat to put the world on notice of its interest in the property. How to lodge a lessee caveat? Landgate provides forms for the lodgment of caveats and provided the form is correctly completed, supported by the relevant evidence of the caveatable interest (being the lease for a lessee caveat) other required supporting documentation and lodgment fee, Landgate will register the caveat. In saying that, a successfully lodged caveat does not mean that the caveat is free of defect. For example, the caveatable interest could be incorrectly described leaving the caveat defective and the caveator unprotected. Accordingly, care must be taken when preparing a lessee caveat in order to ensure that the leasehold interest is adequately protected. Please contact us for assistance in lodging a lessee's caveat. Contact us.