South Australian Current Acts South Australian Current ActsSchedule 1B—Building upgrade agreements
(1) In this
Schedule—
approved methodology means a methodology approved by the Minister by notice in
the Gazette from time to time for the purpose of calculating a reasonable
estimate of cost savings made or to be made by a lessee of a building as a
consequence of upgrade works under a building upgrade agreement relating to
the building;
capital value has the same meaning as in section 5(1) of the
Valuation of Land Act 1971 ;
environmental upgrade works means works that improve the energy, water or
environmental efficiency or sustainability of a building;
Examples—
1 Works that increase the efficiency of the energy
or water consumption of a building or reduce its energy or water consumption.
2 Works that prevent or reduce pollution or
eliminate or reduce the discharges of wastes or other substances harmful to
the environment.
3 Works that reduce the use of materials or enable
the recovery or recycling of materials.
late payment fee means an administrative fee that may be retained by a council
for late payment of a building upgrade charge;
primary parties to a building upgrade agreement means the parties referred to
in clause 2(1);
relevant land means the land on which is situated a building that is, or is
intended to be, the subject of a building upgrade agreement;
service fee means a fee that covers any costs incurred by a council in
entering into, and administering, a building upgrade agreement;
upgrade works in relation to a building means—
(a)
environmental upgrade works; or
(b)
works of a kind prescribed by the regulations,
but does not include works of a kind excluded from the ambit of this
definition by the regulations.
(2) In this
schedule—
(a)
common property , community corporation , community lot , community scheme ,
lot entitlement , owner and strata plan have the same respective meanings as
in the Community Titles Act 1996 ;
(b)
strata corporation , strata scheme , unit , unit entitlement and unit holder
have the same respective meanings as in the Strata Titles Act 1988 .
(3) In this Schedule,
a reference to a building owner is—
(a) in
the case of a building that is the subject of a community scheme—
(i)
if the scheme is one under which the land is divided by a
strata plan—a reference to the community corporation; or
(ii)
in any other case—a reference to the owners of the
community lots; or
(b) in
the case of a building that is the subject of a strata scheme—a
reference to the strata corporation; or
(c) in
any other case—subject to subclause (4), a reference to the owner
of the relevant land.
(4) Despite
subclause (3)(c), if, in relation to—
(a)
dedicated land or Crown leasehold land (both within the meaning of the
Crown Land Management Act 2009 ); or
(b) land
subject to a licence or Crown condition agreement under the
Crown Land Management Act 2009 ,
the Minister responsible for the administration of that Act delegates to the
person or body the subject of the dedication, lease, licence or agreement the
power to enter into, or to vary or terminate, a building upgrade agreement on
behalf of the Crown in respect of a building on the land, a reference to a
building owner in this Schedule is a reference to that person or body.
(5) A delegation under
subclause (4)—
(a) must
be by instrument in writing; and
(b) may
be absolute or conditional; and
(c) is
revocable at will.
(6) A power delegated
under this section may not be further delegated.
(1) Subject to this
clause, a council may, in relation to a building situated on land within the
area of the council, enter into an agreement (a building upgrade agreement )
under which—
(a) the
building owner agrees to undertake upgrade works in respect of the building;
and
(b) a
finance provider agrees to advance money to the building owner for the purpose
of funding those upgrade works; and
(c) the
council agrees—
(i)
to levy a charge on the relevant land (a building upgrade
charge ), to be paid by the building owner, for the purpose of recouping the
money advanced by the finance provider for the upgrade works (and any interest
or other charges payable to the finance provider under the agreement); and
(ii)
to pay to the finance provider any money paid to the
council by way of the building upgrade charge (other than any service fee or
late payment fee that the council is permitted by the agreement to deduct and
retain).
(2) A
building upgrade agreement may only be made in respect of a building of a
prescribed kind, the construction of which was completed at least 2 years
before the making of the agreement.
(3) If a
building upgrade agreement includes provision for payment to the finance
provider of penalty interest on money advanced by the finance provider under
the agreement, the rate of such interest will be—
(a) if
the regulations provide for the determination of the rate—determined in
accordance with the regulations; or
(b) if
the regulations do not provide for the determination of the
rate—determined in accordance with the agreement.
(4) If the primary
parties to a building upgrade agreement agree, the agreement may be entered
into by any other persons that the primary parties consider should be parties
to the agreement.
(5) A council must not
enter into a building upgrade agreement unless—
(a) the
total amount of taxes, rates, charges and mortgages owing on the relevant
land, when added to the total value of the building upgrade charge as set out
in the proposed building upgrade agreement, is an amount not exceeding 80% of
the capital value of the relevant land prior to any works that would be
undertaken as part of the agreement; and
(b) the
building owner has complied with subclause (6) and with any additional
requirements prescribed by the regulations.
(6) A building owner
who intends to become a primary party to a building upgrade agreement with a
council must—
(a) give
any existing mortgagee in respect of the relevant land written notice—
(i)
of the building owner's intention to enter into a
building upgrade agreement; and
(ii)
of the particulars of any proposed
building upgrade charge that is to be levied by the council under the proposed
agreement; and
(iii)
of any prescribed matters; and
(b)
provide the council with the following information verified by statutory
declaration:
(i)
particulars of all mortgages (both registered and
unregistered) over the relevant land, including—
(A) the total amount owing in respect of
each mortgage; and
(B) if a relevant mortgage is held
against 2 or more properties including the relevant land—the
proportion of the debt secured by the mortgage that applies to that land
calculated in accordance with subclause (7);
(ii)
particulars of all taxes, rates and charges owing on the
relevant land (including the total amount owing in respect of each tax, rate
or charge) imposed by or under an Act;
(iii)
a statement that the building owner has complied with
paragraph (a).
(7) For the purposes
of subclause (6)(b)(i)(B), the proportion of the debt secured by the
mortgage that applies to the relevant land must be calculated by distributing
the debt between all the properties against which the mortgage is held in
proportion to the relative capital values of the properties.
3—Agreement to be made on voluntary basis
(1) Entry into a
building upgrade agreement is voluntary.
(2) A council cannot
require any person to enter into a building upgrade agreement, whether as a
condition of a development authorisation under the Development Act 1993
or by any other means.
4—Variation or termination of agreement
A building upgrade agreement may be varied or terminated by further agreement
between the primary parties.
(1) A building
upgrade agreement must be made in writing and specify—
(a) the
upgrade works to be undertaken by or on behalf of the building owner under the
agreement; and
(b) the
amount of money to be advanced by the finance provider under the agreement;
and
(c) the
amount of the building upgrade charge to be levied by the council under the
agreement; and
(d) the
schedule for the payment, by the building owner, of a building upgrade charge
to the council; and
(e) the
amount of, or a method for calculating the amount of, any service fee or late
payment fee that the council may deduct and retain; and
(f) any
prescribed matters.
(2) A
building upgrade agreement may—
(a)
provide for the early repayment of any amount payable under the agreement; and
(b)
include such other provisions as may be agreed to by the parties to the
agreement.
(3) The regulations
may provide that certain matters which must be specified in a
building upgrade agreement under subclause (1) are to prevail against
other matters provided for in the agreement to the extent of any
inconsistency.
6—Declaration of building upgrade charge
(1) After a council
enters into a building upgrade agreement, the council must, in accordance with
the terms of the agreement, declare a building upgrade charge in respect of
the relevant land (being a charge of the agreed amount specified in the
building upgrade agreement).
(2) If a council
declares a building upgrade charge, the council must within 28 days after
the declaration give the building owner written notice specifying—
(a) the
name and address of the building owner; and
(b) a
description of the relevant land in respect of which the building
upgrade charge is being levied; and
(c) the
building upgrade agreement under which the building upgrade charge is being
levied; and
(d) the
amount for which the building owner is liable; and
(e) the
manner of payment of the amount; and
(f) the
due date for payment of the amount, in accordance with the schedule for the
payment of the building upgrade charge to the council (specified in the
building upgrade agreement); and
(g) the
amount of, or method of calculating, any service fee of the council authorised
by the building upgrade agreement and any late payment fee that may be imposed
by the council if the building owner fails to pay an amount for which the
building owner is liable by the due date; and
(h) any
prescribed matters.
(3) A notice under
subclause (2) must comply with any requirements prescribed by the
regulations.
(4) A council must, in
relation to each payment in respect of a building upgrade charge for which a
building owner is liable, give a notice under subclause (2) to the
building owner at least 28 days before the date for payment specified in
the notice.
7—Payment of building upgrade charge
(1) An amount for
which a building owner is liable in respect of a building upgrade charge is
due and must be paid by the date specified in the relevant notice under
clause 6.
(2) On payment of
money in respect of a building upgrade charge to a council, the council may
deduct and retain any service fee and late payment fee authorised by the
building upgrade agreement.
(3) Money paid to a
council in respect of a building upgrade charge, other than any service fee
and late payment fee retained by the council, must—
(a) be
held by the council on behalf of the finance provider pending payment to the
finance provider; and
(b) be
paid by the council to the finance provider in accordance with the terms of
the building upgrade agreement under which the charge was levied.
8—Building upgrade charge is a charge against land
(1) A
building upgrade charge is, until paid in full, a charge on the relevant land.
(2) However, if a
building upgrade charge relates to the common property, or part of the common
property, of a community scheme or strata scheme, the charge is not a charge
on the common property but is, instead, a charge on each of—
(a) in
the case of a community scheme—the community lots of the community
scheme in proportion to the lot entitlements of the respective lots; or
(b) in
the case of a strata scheme—the units of the strata scheme in proportion
to the unit entitlements of the unit holders.
9—Sale of land for non-payment of building upgrade charge
(1) Subject to this
clause, if an amount for which a building owner is liable in respect of a
building upgrade charge remains unpaid for more than 3 years, the council
may sell the relevant land in accordance with the regulations.
(2) Any money received
by the council in respect of the sale of land under this clause will be
applied as follows:
(a)
firstly—in paying the costs of the sale and any other costs incurred in
proceeding under this clause;
(b)
secondly—in discharging any liabilities to the council in respect of the
land (other than any building upgrade charge, service fee or late payment fee
in relation to a building upgrade charge);
(c)
thirdly—in discharging any liability to the council for a
building upgrade charge, service fee or late payment fee in relation to a
building upgrade charge;
(d)
fourthly—in discharging any liability to the Crown for rates, charges or
taxes, or any prescribed liability to the Crown in respect of the land;
(e)
fifthly—in discharging any liabilities secured by registered mortgages,
encumbrances or charges;
(f)
sixthly—in discharging any other mortgages, encumbrances or charges of
which the council has notice;
(g)
seventhly—in payment to the owner of the land.
(3) If the owner
cannot be found after making reasonable inquiries as to his or her
whereabouts, an amount payable to the owner must be dealt with in accordance
with section 6 of the Unclaimed Money Act 2021 as money the owner of
which cannot be found.
(4) If land is sold in
pursuance of this clause, an instrument of transfer or conveyance (as
appropriate) under the council's common seal will, on registration, operate to
vest title to the land in the purchaser.
(5) The title vested
in a purchaser under subclause (4) will be free of—
(a) all
mortgages and charges; and
(b) all
leases and licences.
(6) An instrument of
transfer or conveyance in pursuance of a sale under this clause must, when
lodged with the Registrar-General for registration, be accompanied by a
statutory declaration made by the chief executive officer of the council
stating that the requirements of this clause and the regulations in relation
to the sale of the land have been observed.
(8) Despite this
clause and clause 1(4), nothing in this Schedule authorises the sale
of—
(a) any
estate or interest of the Crown in land; or
(b) any
interest in Crown land (within the meaning of the Crown Land Management
Act 2009 ).
10—Repayment of advances to finance provider
(1) A council is not
liable to repay to a finance provider an amount advanced by the finance
provider to a building owner under a building upgrade agreement until the
amount has been paid to or recovered by the council by way of the
building upgrade charge.
(2) If a
building upgrade agreement is terminated before all the money that the finance
provider agreed to advance to the building owner is advanced, the council
must—
(a)
adjust the building upgrade charge to reflect the lower amount advanced to the
building owner; and
(b) give
the building owner written notice of the adjustment.
(3) If, as a result of
an adjustment being made to a building upgrade charge under this clause—
(a) the
building owner has made payment in respect of the charge in excess of the
adjusted amount; and
(b) the
excess amount has been paid by the council to the finance provider,
then—
(c) the
finance provider must repay the excess amount to the council; and
(d) the
council must refund the building owner the excess amount paid.
11—Liability of council to recover building upgrade charge
(1) A council must use
its best endeavours to recover a building upgrade charge in accordance with
the terms of the building upgrade agreement under which the charge is
authorised.
(2) However, a council
is not liable for any failure by a building owner to pay a
building upgrade charge and any such failure does not make the council liable
to pay any outstanding amount to the finance provider.
12—Recovery of contribution towards building upgrade charge from lessee
(1) Subject to this
clause, a provision of a lease may require a lessee to pay to the lessor a
contribution towards a building upgrade charge payable under a
building upgrade agreement that relates to premises that are the subject of
the lease.
(2) A lessor is not
entitled to recover a contribution from a lessee towards a
building upgrade charge payable under a building upgrade agreement
unless—
(a) if
the lessee requests a copy of the agreement, the lessor has provided the
lessee with a copy of the upgrade agreement; and
(b) the
lessor has given the lessee—
(A) the amount of the contribution that the
lessee will be required to pay; and
(B) the period within which the
contribution will be required to be paid,
and the lessee consents to the payment of the contribution; or
(ii)
at least 30 days before payment of the first
contribution by the lessee is due, written notice of—
(A) the amount of the contribution that the
lessee will be required to pay; and
(B) the period within which the
contribution will be required to be paid; and
(C) a reasonable estimate (calculated in
accordance with an approved methodology) of cost savings that may be made by
the lessee, as a consequence of the upgrade works provided for by the
building upgrade agreement, during the period to which the contribution
relates (a reasonable estimate ); and
(D) evidence of the calculations made in
accordance with the particular approved methodology used to calculate the
reasonable estimate,
and the contribution specified in the notice does not exceed the reasonable
estimate.
(3) The regulations
may make further provision in relation to the recovery under a lease of a
contribution from a lessee towards a building upgrade charge payable under a
building upgrade agreement (including provisions relating to the entitlement
of a lessor to recover such contributions and provisions that impose further
requirements on a lessor or lessee in relation to the recovery of such
contributions).
(4) This clause
applies subject to the operation of section 73 of the
Residential Tenancies Act 1995 (so that a lessee who is a tenant under a
residential tenancy agreement (within the meaning of that Act) cannot be
required to pay a contribution under this clause).
(5) This clause
applies despite section 13 of the Retail and Commercial Leases
Act 1995 and, to avoid doubt, a contribution under this clause—
(a) is
to be taken to be an outgoing for the purposes of that Act; and
(b) in
the case of a lease to which that Act applies entered into prior to the
execution of a building upgrade agreement relating to premises the subject of
the lease—may be recovered (despite section 26 of the Retail and
Commercial Leases Act 1995 ) whether or not the contribution is disclosed
in a disclosure statement given to the lessee in accordance with Part 3
of that Act.
13—Register of building upgrade agreements
(1) A council must
keep a register of building upgrade agreements.
(2) The register must
include the information prescribed by the regulations.
(3) The register must
be available for inspection (without charge) by a member of the public at the
principal office of the council during ordinary office hours.
(4) A person is
entitled to an extract from the register (without charge).
14—Minister may require council to report on building upgrade agreements
The Minister may require a council to provide a report containing the
information specified by the Minister relating to building upgrade agreements
entered into by the council.
The Governor may, by regulation, make further provision in relation to
building upgrade agreements.