Section 66G of the Conveyancing Act in action.

Trying to negotiate the sale of a home that two people had once planned their future together in can be trying at the best of times. It becomes even more complicated when one or more of the co-owners choose to make the situation much harder than it should be. When a resolution cannot be met between these parties, a Trustee being appointed pursuant to Section 66G of the Conveyancing Act 1919 (NSW) (or other equivalent legislation in the respective state) may be the only way to achieve the best possible result when it comes to a sale. Below, I have compiled my favourite examples where these kinds of difficulties may arise and the fantastic value of having a Trustee appointed to sell the property under Section 66G.

Bhattacharyya (“B”) v Sarikaya (“S”)

Facts:-

  • B and S purchased property in Eden together.
  • Relationship breaks down.
  • B and S are also in another New South Wales Supreme Court legal dispute against each other. S claimed B owes him money.
  • B wishes to sell the property, while S appears to use the issue as a negotiating tool.
  • S eventually concedes that he wishes to sell the property but does not want to have trustees appointed to sell the property.
  • S offers to have the property sold and that B may choose the real estate agent and solicitor of her choice.
  • B does not accept that offer on the basis indicating that she does not trust S.

Judgment:-

Concerned by the ongoing conflict between the parties, and the potential difficulties of them agreeing to a sale the Judge ordered that Trustees be appointed to sell the property pursuant to section 66G of the Conveyancing Act .

Editor’s notes:- I chose this case first because it illustrates how difficult it is for a defendant to resist an order for a trustee to be appointed to sell the property. The defendant tried to use the plaintiffs wishes to sell as a bargaining tactic and slowly retreated his position to a point of agreeing to sell with conditions. However, this case shows that if one party wants to sell, it is not a negotiation but almost a right, so you either jump on board or the plaintiff can get a section 66G.

Joseph (“J”) v Agrey (“A”)

  • Property purchased in Lismore (“the property”) with multiple buyers for the purposes of development.
  • J and the second plaintiff Robinson (“R”) bought out other investors share in the property so they both owned a separate 3/8 share in the property.
  • The defendants A and Manzart (“M”) owned the remaining 2/8 share in the property.
  • The plaintiffs spent $221,376 and the defendant spent $10,144 on the costs of developing the property.
  • The defendant did not contest the principle of the appointment of Trustees to sell the property, noting that it was only in exceptional circumstances that a co-owner is not entitled to an order pursuant to section 66G.

Judgment:-

The judge ordered trustees be appointed to sell the property, with the net proceeds of sale to be first disbursed to repay the above mentioned costs involved in developing the property to the relevant parties and then disbursed pursuant to their proprietary interest per the co-owners share in the property.

Editor’s notes:- This case is a good example of how the proceeds of sale will be disbursed in a section 66G sale when registered owners have put in different contributions to the property development. I also thought it relevant as the prevalence of multiple owner parties going into property investments anecdotally appears to be increasing.

Generally speaking, if the other side is not willing to consent to the sale of a property prior to judgment of a Section 66G application being handed down, they were never going to consent to the sale. Thus, should one party be delaying, stalling or making the process increasingly difficult, I would recommend you consider obtaining the consent of a Trustee to Act on the sale to remind the other side of where the matter may be heading.

If you have any further questions about Section 66G of the Conveyancing Act or are looking for specialist Trustees to appoint over an asset please do not hesitate to contact me.

Please note this blog is a more detailed follow up of my general blog promoting the situations a Section 66G application can be used, which can be viewed at http://www.joshtaylor.net.au/66g-application-the-magic-bullet-for-property-sale-disputes-between-co-owners/