Original Article By Marina Trajkovich

9 News

7:34pm Jan 24, 2022

In Queensland, property owners with forfeited contracts due to missed settlement deadlines are within their legal rights to keep deposit payments. However under the new requirements, both buyers and sellers can now extend settlement deadlines by five (5) business days, without requiring approval from the opposite party.

Shasta Turnbull from BlueKey Lawyers said “If there’s a last-minute issue, buyers aren’t going to be in a situation where they lose their deposit or contract,” Ms Turnbull said. However there are potential limitations to the new rules.

“We recognise that whilst it fixes one problem, it does potentially create a set of other potential problems.

“If you’re a buyer and you’re sitting in a moving truck at 3.59 on the day of settlement and the seller extends settlement, you can’t say no to that.”

The Real Estate Institute of Queensland initiated the new laws. Its CEO Antonia Mercorela said the rules would hopefully eliminate the potential for settlement day disasters.

“If we find that it is being exploited or that we’ve not struck that balance correctly, we will reassess,” she said.

REIQ UPDATE

New editions of the Contract for Houses and Residential Land (17th ed.) and Contract for Residential Lots in a Community Titles Scheme (13th ed.) are now available.

The changes include:

• Definition of Contract Date amended to accommodate signing of electronic contracts

• The ability of either party to obtain a short extension to settlement where the party is unable to settle due to the inaction or delay of a financier or for any other reason. The new clause 6.2 responds to ongoing difficulties faced by buyers who have been unable to settle on time, leading in some cases to contracts being terminated. This change to “time of the essence” will alleviate the circumstance where buyers are potentially unfairly affected by delays outside of their control.

• New smoke alarm clause 7.8, responding to changes to smoke alarm regulations on 1 January 2022.

• Express provision for paying a deposit by direct debit and a grace period allowed to address the impact of delays in the deposit of money to accounts when using direct debit.

• Amendments to the Pool Compliance Certificate obligations. A seller is required to hand over a pool compliance certificate for a non-shared pool on the land at settlement.

• Amendments to clause 7.5 regarding services infrastructure located on the land but unrelated to services provided to the land. This includes a new right to terminate if infrastructure unrelated to delivery of services (gas, electricity, water, sewerage) to the Land pass through the Land and are not protected by a registered easement, BMS or statutory authority that has been disclosed to the buyer.

• Amendments to clause 7.6 to change the responsibility for notices to do work, depending on when the notice is issued (prior to or after contract), when compliance with the notice is required (before or after settlement) and whether the notice is disclosed by the seller to the buyer prior to contract.