Neighbours “Impaled” By Home Ownership Crisis
[Author – Tim ODwyer]
“We need help, David, well and truly we really do.” This plea was made by distraught homeowners Dave and Karen Huxley to reporter David Margan of Channel 9’s A Current Affair. The Huxleys had been horrified to discover not only that their home of seven years was not really theirs, but also that no one wanted to help them sort out the problem.
“This is our house, but it’s not our house. Next door is our house, but it’s not our house,” they told David Margan who then tried to explain to a prime-time television audience this month the seemingly inexplicable: that this couple have been living in a house legally owned by their next-door neighbour, Sarah La, whose house was legally owned by them.
This “crisis of home ownership” had, as David Margan put it, “impaled” Dave, Karen and Sarah.
When A Current Affair came to me for my comments, my immediate response – included in the television story – was that this was “a property lawyer’s delight, a litigation lawyer’s best dream” and, for everyone else involved, “their worst nightmare”.
For Huxleys it remains a living nightmare: “Nobody is in a position to help us. They just wipe it. They don’t want to know about it. They just want it to go away.”
Dave and Karen live at 40 Ashridge Road in a house which was originally on a larger block. Ten years ago the owner subdivided the block into two lots, then a house was built on the new vacant lot. Dave and Karen bought the original house at number 40 while the new house at number 38 was sold to other buyers. And later resold twice more. Sarah, the most recent buyer, was shocked when the bad news was broken to her. “Basically, I want to have my house, the one that I bought,” she said.
David Margan pointed out that over the years “probably three sets of lawyers”, a series of lenders and real estate agents, a Council and two government departments had dealt with these properties (and taken fees) yet, as he observed, “not one of them discovered the problem”. I agreed: “It beggars belief that so many people all made the same mistake. No one picked it up. No one did the proper checks.”
Only when Huxleys sought a loan for renovations did the extraordinary truth emerge. When their lender told them they could not get a loan because they didn’t own the house they wanted to renovate, Dave and Karen experienced “mass panic”. “My wife just about collapsed and for the last three months we have been going through hell,” Dave said. Valuer Tony Wall was, in David Margan’s words, “the man who cracked the mystery that was seven years in the making.” Never mind that while discovering the problem, he was also the man who killed the loan. “I picked it up after about five minutes of being at the property. It wasn’t hard, it was straightforward,” Tony Wall said.
“Yet everyone else, including all those lawyers, missed it”, remarked David Margan, clearly indicating who might be the prime offenders.
Karen Huxley soon recounted what happened when they took their problem to their lawyer: “He actually just said that he went on the paperwork that was given to him from the real estate when we first bought the house.”
Not unexpectedly, the solicitor did not want to talk toA Current Affair. Hence David Margan’s snipe, as he was walked out of the solicitor’s office, that this was “a little surprising given that he was the solicitor doing the conveyancing in the first place and, after all, he’s the one who’s paid to make sure these things don’t happen. Now he wants $1,100.00 from those clients before he’ll lift a finger to help them.”
Next came a question to me: “Tell me, Tim, what is involved in conveyancing?” “That is a leading question,” I protested, but happily explained that conveyancing was “making sure that a property that’s been sold is what your client buys.”
Then David Margan warned any viewers about to buy or sell a house to take particular note of the rider I added (on behalf of all conveyancing solicitors): “Our job is to convey, it’s not our job to identify.”
Naturally enough, David Margan’s next warning was: “So if you think paying a lawyer will give you security, think again.”
Karen Huxley summed it all up: “We haven’t done anything wrong. This wasn’t our fault.” And Dave added: “And we paid originally to get it done. Why do we have to pay again?”
Shortly after this disturbing story ran on A Current Affair, Dave and Karen’s local daily newspaper, The Queensland Times, also reported on what it described as a “bureaucratic nightmare that would make the inventor of red tape blush crimson.” Talk about purple prose!
Chief Reporter Steve Gray went on to detail the ownership dilemma, and reached this conclusion: “Somewhere in these exchanges of paperwork the titles of the two blocks were confused … The error has escaped the attention of, or even been ignored by, a bevy of lawyers, Council staff, State Government officials and the banks who financed the deals.” Funny how this time the real estate agents were let off the hook. Anyhow, Dave Huxley gave this account of how he and Karen received the bad news: “Their valuer came back and said we could borrow money on the house next door which we don’t own but are supposed to own. But they wouldn’t loan us money on the house we’re living in, which we are supposed to own but technically don’t”.
The bottom line is that, with a little goodwill between neighbours, an Office of State Revenue waiver of stamp duties and a local Council’s adjustment (for different rates paid on the lots), this “bizarre business” – as A Current Affair called it – can be sorted out. As I told David Margan, a couple of simple transfers and a few hundred dollars in Titles Office fees should then do the trick.
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