QLD Who is Liable for Outstanding Council Rates?

[Narelle Hayne]

I am trying to purchase a property which I later discovered was a mortgagee in possession sale. I was provided with a contract that had various additional clauses about as is where is; due diligence, etc. which I can accept, but it is not clear whether I can still seek payment of outstanding rates at settlement as per normal contract of sale.

This house has been for sale for over 12 months for the mortgagee and I am awaiting council rates search to come back to me - but wanted to know who is liable? And if the buyer is liable, which is not reasonable in my opinion, can I make a small claim against the original mortgagor?

 

[@thelawbundle]

Narelle,

The standard REIQ contract of sale provides that the seller is liable for all outgoings (which includes Council rates) prior to the Settlement Date (and that adjustments can be made at the Settlement Date if those outgoings are assessed but not paid).

However, from what you've said - it seems that there may be special conditions to your contract of sale which could affect these standard contract terms. It's not clear from your question whether this is the case or not.

Have you engaged a solicitor to handle this conveyance? If not - this is recommended (and is relatively cheap, and usually fixed-fee - see here).

Your solicitor will be able to advise you as to the effect of any special conditions that you may have agreed to (and whilst you say that it is 'unclear whether you can seek payment of outstanding rates at settlement' - your solicitor should be able to give you a definite answer once they've read your contract).

Best wishes.