As part of the recent legislative reforms undertaken by the Queensland Government, the process to sell land for arrears of rates under section 132 of the Local Government Regulation 2012 (Qld) has been amended by the passing of the Local Government Legislation Amendment Regulation (No1) 2020.
The amendments in relation to the sale of land for arrears of rates came into effect on 12 October 2020.
This is likely to be a welcome relief for many local governments dealing with overdue rates and charges where there is little prospect of selling the land at auction and where there is a greater risk that the local government will be required to take the land itself for the reserve price if it doesn’t sell at auction.
The amendments will now allow a local government to recover the overdue rates and charges through negotiation while removing the risk in having to take the land simply because it had tried to sell it at auction and was not successful.
In a nutshell, the amendments to the sale of land for arrears of rates are as follows:
- removal of the requirement for a local government to only deal with the highest bidder if the land is not sold at auction. A local government may now negotiate with any bidder who attended the auction
- replacement of the requirement that the sale price must be more than the highest bid at the auction with a requirement that the sale price must not be less than the reserve set by the local government at the auction
- deletion of the provision which required the local government to take the land at the reserve price if it did not sell at auction or by subsequent negotiation
- removal of the requirement to place an advertisement in the newspaper with a requirement that the notice be placed on the website, at the local government offices and to take other reasonable steps to notify the public about the sale
- if the land fails to sell at auction, the local government may choose to offer the land for sale by another auction or it can decide to sell the land by negotiation through issuing a sales notice. A sales notice must be given to all with an interest in the land, placed on the land to be sold (where practicable to do so), published on the website and reasonable steps taken to notify the public of the local government’s intention to sell the land by negotiation. The land must be sold at the market value or the amount of the overdue rates or charges or for the value of the land, whichever is higher
- the expenses incurred by a local government, even if it does not proceed with the sale of land, become overdue rates and charges if the expenses are not paid within one year. If the local government decides at a later date to start the sale of land process again, these expenses will be recoverable as well as any new expenses incurred in relation to selling the land.
Local governments now have the ability to proceed with the sale of land for arrears of rates without the risk that it may have to acquire the land itself, at its cost, if the auction is unsuccessful. Careful attention is required to the sale process, particularly the notice requirements.
Author: Eleanor Scott
- Holding Redlich is an exhibitor at the upcoming Local Government Association of Queensland (LGAQ) Conference at the Gold Coast Convention and Exhibition Centre from 19 to 21 October 2020. Please visit our booth for more information on how we can help local governments and to answer your legal queries.
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