Rural conveyancing requires a raft of specialised searches and due diligence considerations, particularly when you are buying agricultural land in the Surat or Bowen Basins, which is likely to be subject to a mining or petroleum tenement or even a conduct and compensation agreement (‘CCA’) or pipeline easement.
Am I bound by an existing CCA when I buy land?
The short answer is ‘yes’. A CCA is not a personal contract (which would only bind the parties who signed it), it runs with the land. This means that any new landholder (including a lessee or sharefarmer) will be bound by the terms of the existing CCA.
If there is a CCA or pipeline easement in place already, you need specialist advice regarding your rights and responsibilities under those agreements and the relevant legislation.
You may be able to renegotiate the CCA if your purchase of the land represents a ‘material change of circumstances’ resulting in additional compensatable effects. For example, if you are improving the productivity of the land by converting it into a feed lot or installing a centre pivot, a valuer may assess your compensatable effects differently from the previous owner’s.
However, caution must be exercised, because the CCA terms may restrict you from certain activities and will likely place a positive obligation on you to mitigate your losses.
How do I know if there is a CCA on the land I want to buy?
New legislation that passed in 2014 (but has not yet come into effect) proposes to require that CCAs are registered on title. The terms and compensation will not be visible to the public, but at least a quick title search will tell you that there is one and when it was entered into. This is how we currently search to check for easements and mortgages attaching to the land.
In the meantime, the only way to know if there is a CCA in place is to ask the seller. Your purchase contract should therefore include a warranty from the seller that there is no existing CCA and no current ‘Notice of Intention to Negotiate’ in relation to the land. If there is one, your purchase contract should include a requirement for the seller to provide those documents for your consideration in a due diligence period before the contract goes unconditional.
How do I know if there is a tenement on my land?
Even if there is no CCA or pipeline easement yet in place, you can get a reasonable indication of whether there is likely to be one required in the future by examining the tenements over the land.
You can search by lot and plan number at MinesOnlineMaps (use Internet Explorer, not Chrome or Firefox): https://minesonlinemaps.business.qld.gov.au/
Click on the drop-down list labelled ‘I want to’ and select ‘property search’. Follow the prompts, fill in the boxes, and your property search will be emailed to you for free.
When we are conducting pre-contract enquiries for you, we can provide you with this search, as well as more detailed layered maps of all existing tenements, pending applications, existing gas wells, bore holes, registered water bores and areas expected to suffer underground water impacts. We can also provide you with vegetation and overland flow mapping, strategic cropping land, GQAL and priority agricultural areas (PAA) mapping.
How can Creevey Russell assist?
Our Agribusiness Team specialises in rural conveyancing and negotiation of CCAs. We can assist you with your pre-contract enquiries and due diligence investigations. We can negotiate and draft strict contract terms to minimise your exposure to risk, whether you are the buyer or the seller. We understand water licences, livestock accreditation programs and all the other specialist items that you need to consider when buying agricultural land.
We are also available to advise on a wide range of rural and agribusiness matters, including converting leasehold tenure to freehold, agistment contracts, spray drift litigation, vegetation management rules and much more.
Article written by Laura Hogarth, Lawyer at Creevey Russell Lawyers, who is based in Chinchilla and available to meet with clients locally. All members of the team regularly travel between the Brisbane, Toowoomba and Roma offices and to clients’ properties in the region.
Please call a member of the team if you have an issue that you need to discuss.