Hi guys,
We recently ran into an issue that our vendor did not pay the council rate that we have agreed to the settlement adjustment sheet.
The settlement adjustment sheet stated that the fee we paid to the vendor is for the financial year of July 2017 to July 2018, but we still got an outstanding council rate bill from the council.
I have contacted my solicitor many times to chase up with the payment but all we got from the vendor is that they are presently attending to pay.
Its been 4 weeks now since the first email and now we got an overdue notice from the council.
This is the first time we buy an property and we are really unsure what is going on and what we should do. Please help us.
Thank you!
Hi Brian,
“our vendor did not pay the council rate that we have agreed to the settlement adjustment sheet.”
Now, I am not someone versed in all the ways of property and the legals surrounding them, but I have a bit of experience. Still, if others more wise can offer extra thoughts, please do so.
AFAIK, settlement involves a lot of agreeing to figures and the presenting of cheques from one party to another. And I would be asking your conveyancer (or solicitor, whomever did the conveyancing for you) just HOW they managed to complete settlement with monies still outstanding from one party.
Your solicitor is the key to all of this I believe, and should be the one answering you, as THEY are in charge of settlement on your behalf. The buck stops with them (I believe). Ask them to explain it.
Benny
@terryw – is there more to it than that?
Usually at settlment, in NSW at least, the purchaser will take into account the unpaid rates etc and receive a credit for this at settlement from the vendor but the new purchaser will actually pay the rates. Sometimes a cheque is requested from the vendor made out to the council and this is forwarded to council for payment after settlement.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Thank you guys for your quick reply @benny @terryw
There were many back and forth emails between me and my solicitor just to trying to chase up with the issue.
My solicitor forwarded the bills, overdue notice and the settlement adjustment agreement to vendor’s solicitor and he replied us saying his client is going to pay.
I am not sure how they process the money and it is quite hard to talk to my solicitor, she seems like not wanting to explain things.
Usually at settlment, in NSW at least, the purchaser will take into account the unpaid rates etc and receive a credit for this at settlement from the vendor but the new purchaser will actually pay the rates. Sometimes a cheque is requested from the vendor made out to the council and this is forwarded to council for payment after settlement.
“Council Rates adjusted on $1,200.00 for financial year as paid to
30/06/2018 – proportion payable by purchaser 284 /365 days”–$***Above is the line for the council rate in the settlement adjustment statement. So it seems to me that we have already paid our part of council rate to the vendor but they are holding the money up and not forwarding to the council.
I am utterly confused with this thing…
I don’t know which action would be wise to do:
Keep waiting until they pay?
Pay for it now and request a refund from vendor?
PS we are in NSW as well.
Thank you so much guys
No, they have paid you their paid of the council fees.
If you don’t pay the council will take action against you. you are liable.Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
I am so confused…. We have paid the vendor our part that’s on the adjustment agreement which is $900 out of total $1200 for the financial year. The fee has been included in the total amount of money that we have to put in our account before the settlement date which have already been taken by the vendor.
The council rate due date was on 28/02/2018 and 30/05/2018. Both of the dates are before 30/06/2018… I still don’t understand that even the settlement adjustment agreement says we paid the vendor for the council rate up to 30/06/2018, why do we have to pay that amount again to the council?
It really sounds like we are paying for the same period of council rate twice.
How did the vendor take money from your account?
Sounds like no body has paid the council yet to me. You probably received a credit for the vendor’s share up to settlement and you have to pay this plus your share to the council.
Best to check with your lawyer because if you don’t pay the council you will end up with a default judgment on your credit report. You are the owner and therefore the one liable.
Terryw | Structuring Lawyers Pty Ltd / Loan Structuring Pty Ltd
http://www.Structuring.com.au
Email MeLawyer, Mortgage Broker and Tax Advisor (Sydney based but advising Aust wide) http://www.Structuring.com.au
Brian,
I think you should take that settlement document back to the conveyancer/solicitor who DID the settlement, and ask them to explain to you just what went where, and who should now be paying the rates. I am guessing here, but it seems to me like you are endeavouring to understand the settlement adjustment document on your own. I found I needed a good stiff drink and a good hour to “make sense” of those things. It is all “easy peasy” to a solicitor, but to a lay-person it is the stuff of nightmares trying to make sense of them.If I am speaking out of turn here, my apologies – but I recall spending quite some time “deciphering” that kind of stuff, and really having a hard time doing it.
But, as Terryw says – the Council needs to be paid, and you are the new owner – so, it is up to you to “make that happen” whichever way that turns out to be. Good luck,
Regards,
Benny
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