Real property of a deregistered company

Ordinarily, no. While ASIC is vested with the company’s interest in the property it is not obliged to fulfil all obligations imposed on, or attached to, the property. ASIC does not satisfy the debts of deregistered companies or sell vested property for the benefit of creditors. 

However, if ASIC decides to sell a property vested in it, ASIC is required to satisfy outstanding rates and charges only out of the sale proceeds, and only to the extent that there are proceeds available after recovering ASIC’s costs. ASIC has a discretionary power under the Act and is not obliged to sell vested property.

Ordinarily, no. ASIC will not normally take physical possession of vested property.

ASIC has no objection to council carrying out the necessary works and placing a charge over the property to secure recovery of their costs/expenses, in accordance with the relevant State/Territory and local government legislation. Any notice that must be served on the deregistered company can be served on ASIC’s Property Law Team via email. The name and ACN of the deregistered company must be clearly identified in the notice.

Yes. Deregistration of a company that owns real property does not prohibit council exercising their rights.

Any property that vests in ASIC or the Commonwealth as a result of a company’s deregistration remains subject to all liabilities including rates and charges imposed on the property under a law and is not exempt simply because it has vested in ASIC or the Commonwealth.

Council should seek their own legal advice with the view to exercising power of sale to recover outstanding rates and charges under their local government legislation. Relevant notices can be served on ASIC’s Property Law Team via email. The name and ACN of the deregistered company must be clearly identified in the notice.

Where legal proceedings are necessary, ASIC may (if ASIC’s terms and conditions are met) assist council by agreeing to be substituted as a defendant and sign consent orders granting council possession of the vested property.

If there are surplus proceeds payable to the deregistered company after council has sold the property, then – unless the company has been reinstated – the funds are to be forwarded to ASIC's Unclaimed Monies Unit. For information on how to lodge funds and contact the Unclaimed Monies Unit see:

Unclaimed money - how to lodge money unclaimed under the Corporations Act

Neither ASIC nor the Commonwealth is liable for any shortfall owing to council if proceeds from the sale of the property are insufficient to discharge the debt. Council should seek legal advice with the view to reinstating the company if they wish to pursue any shortfall.

For information about company reinstatements see:

Reinstate a company after deregistration.

ASIC encourages council to seek legal advice early to ensure they enforce all their rights within the relevant limitation periods provided under statute.

ASIC has a discretion under the Corporations Act to deal with vested property as it sees fit and is prepared to transfer vested property in lieu of outstanding rates and charges where appropriate. In addition, under some State/Territory laws, local councils may be able to accept transfers of property in lieu of outstanding rates and charges. Council should seek their own legal advice about using these remedies and then contact ASIC’s Property Law Team via email to see how ASIC can assist.

ASIC has no objection to secured creditors enforcing their rights and using existing remedies under State/Territory legislation. Council should contact the mortgagee directly to find out what the mortgagee’s intention is. ASIC has no objection to mortgagees (or any other creditor with security over the property) paying the rates and charges, and if that is the case, council or the secured party should notify ASIC’s Property Law Team via email.

ASIC on behalf of the Commonwealth has no objection to a new trustee being recorded the owner of the property and paying the rates and charges. Council should encourage their customer to ensure the new trustee is recorded as the registered proprietor of the property by contacting the land titles office and/or seeking assistance from ASIC’s Property Law Team via email.

For information about trust property vesting in the Commonwealth see:

Transfer of trust property

Except in cases where rates notices are being sent to a mortgagee in possession, as long as the company remains deregistered and the property remains registered in the company’s name, all rates notices – together with a copy of a recent titles search to prove ownership – must be sent to ASIC via email. The rates notice must clearly identify the name and ACN of the deregistered company.

Please do not post a copy of any document sent electronically unless requested.

Council should direct their customer and/or any party attempting to pay rates on vested property, to ASIC’s Property Law Team via email so that ASIC can assist them to rectify the issue of legal ownership at the Titles Office.

Council should set up a company alert (which is a free service) to monitor a company's status. If its status changes to "strike off" council should immediately contact ASIC's Registry Services to request deferral of deregistration to enable council to pursue the outstanding rates and charges with the company itself.

For more information about setting up company alerts and deferral of deregistration see:

• Using the Company alerts service
• Company deregistration and winding up