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Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:


CALL: (03) 8561 3318

“To buy or not to buy”, “To develop or not to develop”? A Restricitive Convenant on title is an important considertion for would-be purchasers and developers as Property Lawyer Sabina Mehra explains.

Solving the Restrictive Covenant Mystery

One of the key questions at the forefront of a Purchaser or Developer’s mind when buying a property or considering development of a property which has a restrictive covenant recorded against its Title is :

“To buy or not to buy” or “To develop or not to develop”?

Purchasers and Developers alike can be overwhelmed and mystified when they notice a restrictive covenant on the title. Quite often, it can lead to a complete halt in plans for development until the mystery of the restrictive covenant is solved!

What is a Restrictive Covenant?

A restrictive covenant is a written agreement or a contract between land owners that restricts the use and benefit of a parcel of land (“burdened land”) for the benefit of another parcel of land (“benefited land”). In most cases, when these agreements are entered into, they form part of the Title and remain on the Title. Furthermore, restrictive covenants not only binds the current land owner but also subsequent owners of that land.

What is the difference between a Restrictive Covenant, an Easement and a Caveat?

Covenants affecting the land can be either restrictive or positive in nature. A restrictive covenant is negative in nature as it prevents the land owner of the burdened land from undertaking particular activities or exercising certain rights. In contrast, a positive covenant requires the owner of the burdened land to take action for the benefit of other land. Some examples of restrictive covenants include:

  • A single dwelling covenant which prohibits the construction of more than a one single dwelling on the burdened land. The effect of this covenant is that the landowner is restricted from subdividing the land.;
  • A covenant imposing height restrictions on structures on the burdened land (such as fences) or;
  • A covenant preventing the land owner from conducting a particular business or trade on that land; or
  • A covenant restricting the use of certain building materials on construction of exterior walls or the frontage of the property (e.g.,brick veneer only).

In contrast, a positive covenant requires the owner of the burdened land to take action for the benefit of other land. For example, a requirement for land owner to landscape the gardens on the property or construct a fence along a boundary.

There may also be covenants or agreements between the land owner and a public authority in the course of developing the land pursuant to Section 173 of the Planning and Environment Act 1987 (Vic)(“Act”). These can also be positive or negative in nature but have no real effect on the purchaser or developer once compliance under that agreement has been met.

Can a Restrictive Covenant be altered or removed from the Title?

Before the Victorian Parliament passed the Planning and Environment (Restrictive Covenants) Bill in the year 2000, property owners who were affected by a restrictive covenant were able to obtain a planning permit without the need to modify or remove the restrictive covenant. This which often resulted in a breach of the covenant. Subsequently,the Act was amended to include Section 61 (4) which has since prevented the grant of planning permits if it would breach a restrictive covenant unless the restrictive covenant was varied or removed.

It is possible to remove or alter a covenant by the following methods:

  1. By submitting a Planning Permit Application to the relevant local Council to remove or vary a covenant;
  2. By making an Application to the Supreme Court under Section 84 of the Property Law Act seeking orders to either modify or remove the covenant; or
  3. By requesting an amendment to the Planning Scheme under Part 3 of the Act.

An Application made under any of the above methods however, comes with strict considerations and is tested on its own merits. One of the key factors for consideration usually is whether the removal of the restrictive covenant from the burdened land would adversely impact the beneficiary or the owner of the benefited land. While an Application to the Local Council is usually the first step and the preferred course to take when applying to vary or remove a covenant, a Council must refuse an Application under the Act if a beneficiary makes an objection. It can be difficult and a costly exercise when assessing the most suitable course of action.

How Sharrock Pitman Legal Can Assist

Our Property Law Team is led by Andre Ong (Accredited Specialist) in Property Law. Our Property Law Team is experienced to assist and advise you with the variation and/or removal of a restrictive covenant. If you wish to proceed with a Planning Permit Application for removal or variation of the restrictive covenant, we are able to prepare the relevant Application, supporting submissions and documents to the Council. Should the Council grant the Application, we can also assist in removing the covenant from the Title.

If you require assistance, please contact Sabina Mehra, Associate Lawyer in the Property Law Team directly on (03) 8561 3327. Alternatively, please contact our Property Law Team on 1300 205 506 or via email sp@sharrockpitman.com.au.

Further Information

More articles by our Property Law Team are published here.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Written by a member of our Legal Team

,

.

Sabina Mehra

For further information contact

Sabina Mehra

Sabina is a senior property lawyer in our Property team and has experience in dealing with a wide range of complex property and commercial law matters.

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“To buy or not to buy”, “To develop or not to develop”? A Restricitive Convenant on title is an important considertion for would-be purchasers and developers as Property Lawyer Sabina Mehra explains.

However, in this article we will set out the factors that influence how long it will take to obtain a Grant of Probate and to administer an estate in Victoria.

The basics

First things first: what is a Grant of Probate? A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will. Without Probate, the asset holders (say a bank or share registry) cannot be satisfied as who has the correct authority to receive the deceased's assets and may refuse to pay out.

Sometimes, for smaller estates or if assets are mostly jointly owned with a surviving spouse, asset holders might agree to release payment without requiring a Grant of Probate. This is usually on the basis that the person who receives payment promises to repay (or Indemnify) the asset holder if it turns out they paid to the wrong person.

If there is no Will, then you cannot obtain a Grant of Probate. Instead you obtain Letters of Administration. This is effectively the same, in terms of authorising someone to administer the estate, and would usually be obtained by the person who is the closest next-of-kin to the deceased.

“A Grant of Probate is effectively a document issued by the Supreme Court of Victoria which formally authorises an executor to manage the estate of a deceased person in accordance with their Will.”

Timeframes for Probate in Victoria

In order to obtain a Grant of Probate, the Supreme Court needs to be given information about the assets and liabilities of the estate, the deceased person, the witnesses to the Will, the executors and the Will itself. An advertisement of your intention to apply for Probate must also be published on the Supreme Court website for at least 14 days prior to any application being lodged.

Often, making enquires to obtain all the necessary information can take a number of weeks. Also, you will need the Death Certificate for the application for Grant of Probate and possibly for making proper enquires regarding the assets and liabilities. Waiting for the Death Certificate to issue can therefore add a few more weeks to the process. Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.

The Court itself usually does not take long to process the application (maybe another 1 to 2 weeks) and this is completed using the electronic Supreme Court filing system. This means you do not have to go to a Court hearing. The timeframe for processing applications for Letters of Administration is even less, given that there is no Will document for the Court to consider. There is also a general discretion for the Court to raise a 'Requisition' asking for more information before they review the application - this can sometimes delay matters.

“Overall, if you have your application for Grant of Probate lodged within 1 to 2 months from the date of death, you are making timely progress.”

So, here we are a few months after death and you finally have a Grant of Probate or Letters of Administration. It is important to remember that this is the start of the estate administration and not the end. For a very simple estate, you might only need a further month or so to cash the assets and pay them to the correct beneficiaries. However, it can often be more complex than that. Factors that determine the timeframe to administer the estate include:-

  • Some assets will take time to cash or transfer. For example, if selling a property, final settlement might be 60/90/120 days from the day of sale.
  • There is a 6 month period for challenges to be brought against the estate and executors must wait until this period expires before distributing the estate, if there is any risk that a disgruntled family member might come forward.
  • There might need to be final tax returns for the deceased or for the estate. Failing to wait for the ATO to process these could leave the executor personally liable for a tax bill.
  • You might need to advertise for creditors to come forward and wait for a period of months while this advertising timeframe expires. This protects the executor if they are unsure of all of the deceased's financial dealings and creditors.
  • It might not always be a good time to immediately cash estate assets. For example, the shares just took a nose-dive, do you still sell regardless of available price?

There is a general rule that executors have an 'executor's year' to complete the estate administration. This means that you should be aiming to have the estate finalised and distributed within 12 months from the date of death.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.

Need help with Probate?

Our expert legal team is ready to take your call!

Mitchell is the Managing Principal of Sharrock Pitman Legal. He is an Accredited Specialist in Commercial Law (accredited by the Law Institute of Victoria). He also deals with areas of Employment Law, Wills & Estate Planning and Probate and can answer all your questions related to probate.

For further information, contact Mitchell on his direct line:

DIRECT LINE: 
(03) 8561 3318

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About Sharrock Pitman Legal

For fifty years Sharrock Pitman Legal has made a significant and long term contribution to meeting the legal needs of business owners and residents in the City of Monash and greater Melbourne area.