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The plaintiff does not seem to be having a particularly happy experience with this litigation, makes for an enjoyable (and brief) read. https://www.sclqld.org.au/caselaw/QSC/2021/293

That sounds pretty dramatic, doesn’t it? Well it kind of is, although this is not necessarily new law. But it does shine a spotlight on the fairly common asset protection strategy of the assets of a marriage being put in the name of a “safe” spouse, to keep them insulated against claims arising from the activities of the other spouse. In August 2021 the Full Court of the Federal Court, in Commissioner of Taxation v Bosanac (No 7) [2021] FCA 249, found that a property held in the name of the wife alone was in fact owned 50% by the husband (with the result that the interest is available for this creditors). This decision considered two presumptions at law. The first is the presumption that where two parties contribute toward the cost of acquiring a property but title is put in the name of only one, then it is presumed that the registered owner holds a share in trust for the other party. The second is what is known as the presumption of advancement – where there is a presumption of a gift being made in certain circumstances, eg as between husband and wife (but curiously not necessarily in reverse) and as between parent and child. If the presumption applied, then the money provided by the husband toward the purchase price would be considered a gift, and the first presumption is rebutted (i.e. does not apply). In this decision, in the absence of evidence of the husband as to what he intended (and no mention of a contemporaneous deed of gift), and having regard to his contributions to the price (including becoming liable on borrowings) the Full Court found that the presumption was rebutted, with the result that the property is half owned by the husband. For advice in relation to property ownership, please contact our property lawyers Peter Muller, Jessica Murray, and Megan Hanneman at peterm@qbmlaw.com.au

Please note that this post was prepared before the changes to the standard REIQ contract made in early 2022, which changed the treatment of late payments in certain respects. At any time and in particular in a heated property market the buyer must be careful to perform obligations under a land contract when they are due. An example of this is the obligation to pay the deposit. Under the usual form of residential contract used in Queensland, there is a breach if the buyer pays any part of the deposit late. That breach can be grounds to terminate the contract and keep whatever part of the deposit has been paid. This is different to (say) late communication of the satisfaction of finance. The difference is that in the case of the late payment of the deposit, the seller may still be entitled to terminate even after it has received the deposit, whereas in the case of the late confirmation of acceptance of the finance condition, the seller’s right to terminate generally ends once satisfaction is confirmed (subject to the particular contract used). So as a practical example, a Buyer is to pay a $100,000 deposit in two instalments – one of $10,000 two days after the contract date and one of $90,000 5 days after. He pays the first instalment on time, but misses the second. If the contract was terminated before he pays the second instalment, he loses $10,000. But if he pays the $90,000 on the seventh day (without agreement to extend from the Seller) then the Seller can still terminate and keep the whole $100,000. There are a number of variables to this scenario, as examples the contract used, the wording of the deposit obligation, whether the Seller affirmed the contract or agreed to vary the obligation, but a lot of the drama and risk would have been avoided if the agreement of the Seller to extend the time for payment was obtained before making the second payment. For advice in relation to contracts and their enforcement, please contact the property lawyers at QBM Lawyers – Peter Muller, Jessica Murray, and Megan Hanneman.

Federal Court proceedings have been commenced against Dixon Advisory on behalf of a disappointed client. This follows reports that in July 2021 Dixon Advisory entered into a heads of agreement to resolve other Federal Court proceedings (in that case brought by ASIC) for various breaches relating to advice given. It was reported that the heads provide for Dixon to pay penalties of $7.2M and $1M toward ASIC’s costs. It is important to check on advice from your financial planners and to monitor the performance of assets being managed. Ensure that composition of investments is not creeping into risk areas. For advice in relation to poor investment advice, please contact Peter Muller at peterm@qbmlaw.com.au