Strata acquisition for transport project

Hi crew,

I would be grateful for advice from those more experienced - we signed a contract before covid hit, with settlement next week. Terrace house within 5km of Melbourne CBD. Purchase price middle of asking range, and on par with similar properties in the area in last 3 months.

Today our solicitor called to say during their searches they found a document left out of the vendor's section 32 - essentially a letter of intent dated November 2019 stating the government plans to requisition the strata under the property for a public transport project, starting this month.

We intended it as PPOR for a while but not our forever home. What would you do - would you proceed or back out? Is this something that will strongly affect future market price? Interestingly another house on the same block also recently sold within 2 weeks of this one.

Thanks in advance for any advice you guys have!

 

More detailed info would be req'd to comment.

"Plans to requisition the strata under the property for a public transport project" doesn't state if it is subject to a 2ft wide easement to run a data cable, above a planned tunnel or if they intend to demo the entire place for a hospital or highway......

Has the contract gone unconditional ?
(Date signed, planned settlement date ?)

A paper trail is a must, so could immediately have your solicitor raise it with the vendor asking why this wasn't in the sec32, (and based on that advice) include that this is grounds to terminate the contract (not advice, but like you I'd be very worried about this).

I would also investigate and try to contact the other purchasing party, they may have no idea !

 

They plan to build an underground rail tunnel and it just happens to pass directly under the property (and the lots adjacent). Requisitioning the land underneath the property, not going to acquire/demolish the house etc.

We signed at auction approx 6 weeks ago and settlement is next week. We are frustrated at the timing but glad it turned up before settlement.

Thanks for the advice - will get the solicitor to contact vendor's side asap.

 

Yes, it is expected that such a document disclosing that the land/property is subject to any planned transport project be included in the sect32.

Failure to disclose may be reason to crash the contract, but get legal advice.

I would hope that a train tunnel wouldn't affect the property much at all when completed, but it is often the construction that causes headaches (and proximity to any vent points, particularly car tunnels).

Had the bidding public known of this there may have been less bidders and a 10-20-30% discount to what you agreed to pay !

If your legal team isn't making suggestions then push them or seek better legal advice.
@Terry_w might have suggestions as to a specialist in this area

 

No, I don't know anything about property law or strata. Not my area of focus - I prefer estate planning type law

 

Don't get the question. Your solicitor didn't give you advice so you ask PC ers for their legal opinions? What did the solicitor advise. If s32 was defective what is their advice for a flawed offer and misled acceptance?

 

I'm not familiar with the Victorian equivalent of the Just Terms Acquisition Act but if it's anything like the NSW act, there's no compensation payable for the acquisition of a subterranean stratum where the acquiring agency does not affect the surface of the land.

Basically, the NSW Act says "tough titties" as they aren't touching the surface of your land and will not affect your right to develop the land (unless you're planning on a developing a quarry).

You appear to have purchased at auction so the doctrine of "tough titties" applies unless the defect in the S32 is a fundamental flaw giving rise to a breach of an essential term of the contract.

 

I'm sure you didn't mean for that to sound condescending. My first post was probably unclear, if so I apologise. No, I am not asking for legal advice. Having minimal previous property experience I'm asking this forum for their personal opinions/advice on whether or not they would consider this to be a deal breaker as a buyer (the potential impact of a rail tunnel being built under the property).

My solicitor has already told me what my options are. This apparently includes termination of contract.

 

If you cant hear or see it, then it is really no different then having another service under the surface of your land, ie gas water electricity drainage sewer tele.

The ownership of a title boundary is to the centre of the earth and above into the sky, so that's why they need to notify about the stratum title adjustment. Do you have a copy of the adjusted title? It should say how deep it is below your natural surface or give a AHD (australian height datum) value, which is generally speaking a value in comparison to the sea level, ie 2m would be 2m above sea level.

Normally land acquisition in vic is through the land acquisition and compensation act, but with these big projects i believe sometimes they get their own acts, so compensation terms may be in that as well. I dont really deal with these big projects at work, mainly the big firms and the crown surveyors look at these.