However a ruling back in 2015 meant that a complete 360 occurred 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 were a number of factors behind this decision and they’re captured in this Revenue Ruling from Revenue SA.
Long gone is the need for a Letter of Nomination or Letter of Agency
Revenue SA now takes 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 back in 2015 seemed 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 no longer need a Letter of Nomination / Letter of Agency in any circumstances.
Of course, at Eckermann Conveyancers we will always confirm with the Purchaser the exact entity that is purchasing the property before we prepare Transfer documents, even if an Agent has still written ‘and/or nominee’ or not.
Some incoming Banks want to see the document that links the Purchaser on the Contract to the actual Purchaser/Transferee that will purchase the property, in this situation we provide them with a ‘Confirmation of Purchaser’ document which we have both parties sign.
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 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 both transactions, 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.
Out with the old (well for the most part)
Even though this change took place in 2015, we did notice a transition period where ‘and/or nominee(s)’ were still coming through from time to time on paperwork, while Real Estate agents changed habits forged over a lifetime.
Luckily, the old habit does not cause any issues, it’s simply a fragment of the way things were once done.
From what we’ve ascertained, when we do see the old “and/or nominees” pop up, it tends to because so many purchasers and their accountants are entrenched with the old ways about needing to include “and/or nominee(s)” on the contract.
And that’s where we come in, deep in the details, we check everything thoroughly and continue to apply the correct protocols as each situation requires.