For as long as I’ve been involved in conveyancing, Revenue SA and its predecessors have been pedantic whenever the Transferee on our Transfer has been different from the Purchaser named on the Contract.
But a recent ruling reveals that a complete 360 has been done on the issue effectively removing the need for Real Estate agents to continue the practice of including ‘and/or Nominee(s)’ after the Purchaser’s name on a contract when selling property in South Australia.
There are a number of factors behind this decision and they’re captured in this Revenue Ruling (right-click to download the PDF) from Revenue SA.
Goodbye Letter of Nomination and Letter of Agency
As of now, Revenue SA has taken the position that it doesn’t care whether the entity on the Contract is different from the entity on the Transfer.
This change of heart seems to hinge on this legal insight:
Revenue SA has advised that the Purchaser has a common law right to direct the Vendor to transfer the property to any entity it desires without the requirement for any further documentation.
As a result of these changes, conveyances should no longer need a Letter of Nomination / Letter of Agency in any circumstances.
Of course, at Eckermann Steinert our conveyancers will always confirm with the Purchaser the exact entity that is purchasing the property before we prepare Transfer documents, even when an Agent has still written ‘and/or nominee’ or not.
A restricted need for a Deed of Assignment
In transfers where the Purchaser on the Contract is a relative or related entity of the transferee, and no extra consideration is being paid, we should no longer need a Deed Of Assignment or Letter of Nomination or Letter of Agency.
However, when the Transferee/Assignee is a third party to the Purchaser/Assignor on the Contract, and also where there is extra consideration being paid by the Transferee/Assignee to the Purchaser/Assignor, then there will still be a requirement to complete a Deed of Assignment.
In these situations, our team will make sure that full stamp duty is paid on the full consideration on both conveyances, firstly from the Vendor to the Purchaser/Assignor and then secondly from the Purchaser/Assignor to the Transferee/Assignee.
There are examples on the Revenue Ruling that go into further detail.
So the world is changing again and I’m sure we’ll still see ‘and/or nominee(s)’ coming through on paperwork while Real Estate agents change habits forged over a lifetime.
Luckily, the old habit will not cause any issues, it will simply be a fragment of the way things were once done and you can be sure our team will be applying the correct protocols as each situation requires.