They widened the Road

Property Law: 23 March 2019

The purchase of a development site on the fringe of Melbourne suburbia provides another example of a 'simple, straight forward' purchase needing the input of an experienced and diligent lawyer to prevent things going horribly wrong.

The property concerned had major roads on two sides. The price was in excess of a million dollars and settlement was to occur when the purchaser obtained a planning permit for the proposed development. The purchaser spent over $100,000 drawing plans, liaising with Council, the water authority and VicRoads etc. and over two years before the permit was finally obtained. One of the permit conditions required part of the land along the western boundary to be set aside for road widening.

Settlement was arranged. A last minute check of Title revealed that the Title had been "updatedsince the copy that was included in the Contract of Sale two years earlier. A check of the Title Plan revealed that the land had reduced in size. The lawyer immediately notified the purchaser who dismissed it as a consequence of the planning permit condition.

The lawyer was not satisfied and checked the dealing behind the change to the Title Plan. This revealed that the land (although still known by the same Title and the same lot and plan number) had been reduced in size by almost 10% because of a Country Roads Board road widening scheme over 30 years old that had not been recorded on the Title. As a result, the front 3 metres of the buildings along the eastern boundary on the planning permit plans approved by Council and VicRoads, were in fact located on the road.

Settlement was abandoned and the purchaser subsequently negotiated to buy the property at a discount of $150,000.