New South Wales Consolidated Acts
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TRUSTEE ACT 1925 - SECT 18
Ratio of loan to value
18 Ratio of loan to value
(1) A trustee lending money on the security of any property on which the
trustee can lawfully lend shall not be chargeable with breach of trust by
reason only of the proportion borne by the amount of the loan to the value of
the property at the time when the loan was made, provided that the loan was
made in accordance with this section.
(2) In making the loan the trustee must
have acted upon a report as to the value of the property made by a
qualified valuer, instructed and employed by the trustee independently of any
owner of the property.
(3) The amount of the loan must not exceed--
two-thirds of the value of the property as stated in the report, or
per cent of the value of the property as stated in the report if--
repayment of the loan is insured under a contract of insurance issued by a
prescribed insurer, and
(ii) the mortgagee is the assignee of the benefit of
that contract of insurance.
(4) The loan must have been made under the advice
of the valuer expressed in the report.
(5) This section extends to transfers
of existing securities as well as to new securities.
(6) This section applies
to investments made either before or after the commencement of this Act.
In this section--
"prescribed insurer" means an insurer or an insurer of a class prescribed by
"qualified valuer" means (subject to the regulations) a person who--
membership of the Australian Valuers Institute (other than associate or
student membership), or
(b) has membership of the Australian Property
Institute (other than student or provisional membership), acquired in
connection with his or her occupation as a valuer, or
(c) has membership of
the Royal Institution of Chartered Surveyors as a chartered valuer, or
of a class prescribed by the regulations.
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