Trustees for Sale by Peter Sheehy FLPA Qld

Trustees for Sale by Peter Sheehy FLPA (Qld) Webinar –March 2016

Sources of Power - Family Law Act - sec 80(1)(e) - Family Law Rules - rule 20. 24 - Federal Circuit Rules – Enforcement rule 25 B. 32 Warrant - - Selling other “property” – chattels and businesses

Consent to Act - Affidavit with scale of charges attached - Get the trustee to settle the orders – orders can be general (preferred) or prescriptive - PLA sect 38– are 2 trustees required? - Minimum cost – circa $5, 500 + advertising + commission on sale

Effect of Order - Beneficial interest is transferred on making of order - Insurance issues - Trustee can sign all documents – listings authorities Form 6, and obtain information from banks etc. –prior authorities thusineffective - Stamp Duty is payable if a co-owner buys from trustee – thus need to get “divesting” order

Trustee’s duties - fiduciary - Obtain “best price” in “market” - Act as if you were selling own property - Duty to consult – Under PLA it is a statutory requirement - Ability to get directions from Court – limitations limiting trustees exercise of discretion to

Methods of Sale - Private treaty, auction, EOI, tender or to previous co-owner - Agents Commission issues arise if a sale to prior owner - Power to postpone sale – the limitations - Court’s suspension of orders to give owners the last chance before operation of trustee orders

Value Traps - If trustee can’t perform tenets of order, he/she has to seek to be discharged - Is there sufficient equity in property to perform the order ? – valuations and secured debts - 3 rd party mortgagee's rights versus Trustee’s powers – who has precedence?

Tax Issues - CGT on making of Order – ATO ruling - GST – is Trustee carrying on an enterprise in the role and thus a need to register for GST? - Trustee’s personal obligation for retaining funds and lodgement of returns - ITAA