Conversion of Company Title Schemes
to Strata Title

© Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
Why should we convert to strata
title?
• Own a subdivision of airspace
above the ground on separate
title
• Can sell, mort...
What are some disadvantages of
conversion?
• Can not decide who will
be permitted as an
occupant
• Land Tax and Stamp
Duty...
Power to Convert
• The company must have
the power to convert
• If no power, the company
must change the
Constitution to p...
Decision to Convert
• Canvass the opinion of shareholders
• Put forward a proposed motion to investigate conversion
option...
Matters Affecting Conversion
• Corporate Issues
• Local Government
Requirements
• Survey Matters

• Mortgagees of shares
©...
Steps to Conversion
Company Consent Requirements
•

Altering the Memorandum of Association to allow
conversion (commonly r...
Steps to Conversion continued…
Town Planning and Strata Plan Preparation
• Consult with a Town Planner at the pre-developm...
Steps to Conversion continued…
• Registration at Land
Titles Office
• Transfer of lots to
shareholders in the
company (Sta...
Winding Up the Company
• Once lots are transferred,
shareholders must
commence a voluntary
winding up of company.

© Copyr...
323 Beaconsfield Pde – Case Study
• 18 lots converted to
Strata Title;
• 12 mortgagees; 2
caveators and 1 dead
owner;
• Re...
Upcoming SlideShare
Loading in …5
×

Company Title Conversion

1,442 views

Published on

All you want to know about company title conversion

Published in: Education
  • Be the first to comment

  • Be the first to like this

Company Title Conversion

  1. 1. Conversion of Company Title Schemes to Strata Title © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  2. 2. Why should we convert to strata title? • Own a subdivision of airspace above the ground on separate title • Can sell, mortgage, or lease the lot itself, without the cumbersome share/unit procedure • Ready made dispute resolution procedure through legislation including mediation and the Tribunal • Having strata title to land means a higher market value than company title © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  3. 3. What are some disadvantages of conversion? • Can not decide who will be permitted as an occupant • Land Tax and Stamp Duty may apply • Higher rate liability (water, electricity) • May be capital gains liability on conversion © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  4. 4. Power to Convert • The company must have the power to convert • If no power, the company must change the Constitution to provide the necessary power © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  5. 5. Decision to Convert • Canvass the opinion of shareholders • Put forward a proposed motion to investigate conversion option: “THAT this meeting approves conversion of the company home unit scheme to strata title and that it supports the directors of the company in their proposed investigation of such a course of action.” • Unanimous approval is commonly required. This is specified in the Articles of Association and requires an Annual or Special General Meeting. © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  6. 6. Matters Affecting Conversion • Corporate Issues • Local Government Requirements • Survey Matters • Mortgagees of shares © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  7. 7. Steps to Conversion Company Consent Requirements • Altering the Memorandum of Association to allow conversion (commonly requires special resolution and notification must be provided to ASIC within 21 days of passing the special resolution) • Formal Decision to Convert • Consent of all shareholders in writing © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  8. 8. Steps to Conversion continued… Town Planning and Strata Plan Preparation • Consult with a Town Planner at the pre-development application level • Brief surveyor to prepare Strata Plan and measure the lots in compliance with Planning Instruments (LEP and DCP) • Surveyor Plans and Report to be submitted to local council for Development Application (consent may be required for additional items as part of DA process) © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  9. 9. Steps to Conversion continued… • Registration at Land Titles Office • Transfer of lots to shareholders in the company (Stamp duty payable on transfer) © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  10. 10. Winding Up the Company • Once lots are transferred, shareholders must commence a voluntary winding up of company. © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au
  11. 11. 323 Beaconsfield Pde – Case Study • 18 lots converted to Strata Title; • 12 mortgagees; 2 caveators and 1 dead owner; • Re-alignment of boundaries of car parking spaces; • Increase in value of $80,000 per unit* © Copyright 2012 Teys Lawyerswww.teyslawyers.com.au

×