I am in the process of purchasing a property in a trust, it has gone unconditional but family crisis means I don’t have the deposit now.
I am the trustee and the appointer of the trust.
I believe I can be sued by the seller for all his costs and the difference between what he manages to sell for and my offer.
As this trust doesn’t own anything will he be sucessful?
I have other property in another trust and in my own name. Can he come after these properties?
I am thinking of setting up a company and appointing this company the trustee, will this give me extra protection?
I need a solicitor who understands asset protection in Brisbane urgently.
Thanks
The trustee will be sued and the trustee personally liable. If you are trustee you and your assets are at risk.
Substituting trustees now won't help because the old trustee entered the contract.
Whether they can come after other trusts the answer is yes they can, but it will depend on how it was all set up and transacted. If you go bankruptcy then the trustee in bankruptcy cannot, on the face of it, take assets which you hold on trust for others. But there are lots of exceptions. Since you are the trustee of this trust too there may be a dispute whether you hold these properties in your own right or as trustee.
Your best bet in getting out of the contract is to go thru it with a fine tooth comb and make sure they have given everything or included everything that they are legally required to in the contracts.
If you have a strong stomach you could read this recent QLD case about a purchaser who didn't settle:
South Sky Investments Pty Ltd v Luppi [2012] QSC 27
http://jade.barnet.com.au/Jade.html#sy=261412Terryw | 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
And for a solicitor, google "Bob Balanda" he is on the gold coast somewhere I think. I think he had written some articles on getting out of a contract too.
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
Thanks Terry, I will review these articles.
My solicitor is consulting over a date change in the contract that was not initialled…
However I have discovered that he forgot to add the name of the Appointer in the trust document!
No appointor is a serious issue. You will have to read the trust deed and see if the trustee has the power to amend the deed to be able to add an appointor (probably will).
Make sure you have back up appointors on all your trusts too. What happens if the appointor dies. This is important because it could be the executor of your will if you do not name anyone – and this could end up being someone you don't want.
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
Terryw wrote:The trustee will be sued and the trustee personally liable. If you are trustee you and your assets are at risk.Substituting trustees now won't help because the old trustee entered the contract.
Whether they can come after other trusts the answer is yes they can, but it will depend on how it was all set up and transacted. If you go bankruptcy then the trustee in bankruptcy cannot, on the face of it, take assets which you hold on trust for others. But there are lots of exceptions. Since you are the trustee of this trust too there may be a dispute whether you hold these properties in your own right or as trustee.
Your best bet in getting out of the contract is to go thru it with a fine tooth comb and make sure they have given everything or included everything that they are legally required to in the contracts.
If you have a strong stomach you could read this recent QLD case about a purchaser who didn't settle:
South Sky Investments Pty Ltd v Luppi [2012] QSC 27
http://jade.barnet.com.au/Jade.html#sy=261412under the link quoted is an option to view the full document, well worth a read.. quite heavy going but interesting all the same.
i'm thinking you should do all you can to meet the settlement (after all if your figures were good beforehand then they still are) you may be able to on sell at a loss that is less than the penalites you may face otherwise… or if you picked well and have time to slap some paint around maybe you can flip it for a profit or rent it out so you can focus on the family chrisis.depends a heck of a lot on your specific contracts, financial position, Friends, bank and options.. being creative may save your bacon and still turn a profit
Unfortunately the property is in Dysart, with the mine closure announced this week it is unlikely to turn a profit.
I am worried that the bank will decide to re-value it after settlement next week and call in their loan, this will cause me to go bankrupt and may affect my whole portfolio.
Bank's don't usually revalue or call in residential property loans.
Sounds like you are doing things the risky way. There are ways to do it much more safer for you.
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
There is some hope, look at: https://www.propertyinvesting.com/forums/property-investing/general-property/4344060?
it will affect the town but looks like the area has more going for it.May even attract some speculative buyers looking out for panic sellers in the wake of that closure announcement.
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