Successful Council Negotiations

Happy to have assisted another small developer who has tried to dip its toes into property development by making an application to Council for a duplex development with granny flats at the rear of each proposed dwelling.

Council initially resisted the application, because whilst the development was permissible in the R2 residential zone, the building of the duplex and granny flats all at the same time (and before subdivision) now categorised the development as multi dwelling housing which became prohibited in the zone.

Proceedings were commenced in the Land & Environment Court, and Council insisted that the duplex had to be constructed and have a Final Occupation Certificate issued before the granny flats could be built, which would have made the construction of the granny flats in such a confined space difficult and prohibitive.

Thankfully, as part of the court process, Council were persuaded to issue a staged development consent where the duplexes and granny flats would be built at the same time, but the granny flats not finally completed (i.e. the kitchen still to be installed), which got the client over the permissibility argument and allowed a development consent to be issued.

A difficult case for a small-time developer, but a very pleasing result in the end.

We look forward to seeing the final product once it is finished.

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Appeal Upheld

Pleased to have assisted our client in obtaining approval through the Land & Environment Court for a boarding house development in Belmore Road Randwick under the Affordable Housing SEPP.

The application was originally refused by Randwick Council.

As can be seen from the judgment, the issues that had to be overcome included maintaining a heritage façade, parking, overshadowing, accessibility, height, scale and character, all on a very narrow and constrained site.

We worked through the issues with Council in the court process to achieve an excellent outcome for the client and a development that will sit well in its location.

It was a great result for the client and I look forward to seeing the quality finished product once it is constructed.

You can find the full judgement here.

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Appeal Upheld

Very pleased to have assisted our client in obtaining approval through the Land & Environment Court to increase the capacity of the childcare facility from 24 children to 45 children after commencing proceedings against Penrith City Council who originally refused the proposal.

It was a great outcome for the client who is a family operator, runs a great child care centre, and is extremely pleased at being able to offer an increased child care capacity to that area.

The full decision can be found here.

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Don’t Be Put Out by Put Options

Have you secured the sale of your residential property with put and call options? A recent legal decision shows that sale may not be as secure as you think.

So, What Happened?

A potential purchaser of several residential properties entered into put and call option deeds with several vendors. When the purchaser failed to exercise their call option by a certain date, the vendors decided to exercise their put options. Thereby, the sales contracts attached to those options became binding and the purchaser would be required to make the purchase… At least, that’s what the vendors planned.

Instead, the purchaser rescinded all sales contracts and cited their right to a cooling off period under section 66S of the Conveyancing Act 1919. The vendors were left high and dry.

How could they rescind the contracts if they were made under put and call options? There’s no cooling off period for sales contracts made as a consequence of an option to purchase (section 66T(d) of the Conveyancing Act 1919).

The answer lies in the phrase ‘option to purchase.’ The judge ruled that this language did not include put options, which would be regarded as “options to sell” or “options to require someone else to purchase.”

Since the sales contracts were made binding by the exercising of put options, section 66T(d) didn’t apply. It followed that the purchaser did have a right to a cooling off period and they could rescind the sales contracts when they did.

The Takeaway Is Simple:

When entering into put and call options, make sure you get a section 66W certificate from your potential purchaser. This certificate waives the purchaser’s right to a cooling off period in the case that you exercise your put option.

Many developers consider put and call options to be just as good as a sales contract. This case, however, reveals the differences that could expose you to more risk than you bargained for. Don’t get caught out!

You can find the case of BP7 Pty Ltd v Gavancorp Pty Ltd here.

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Appeal Upheld

Thanks to the representation of Macquarie Lawyers, an appeal was successfully upheld in the NSW Land and Environmental Court to allow the construction of a new 15 room boarding house in Blacktown, and to reverse the decision of Blacktown Council to refuse the application.

The result is most pleasing for our client. The commissioner stated that “The development expands affordable rental housing to cater for the needs of lower income people.” She also noted the development’s encouragement of alternative methods of transportation, citing its proximity to public transport and bike storage.

A link to the full decision can be found here.

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