Is Your Sale Contract Out of Date?

John Cotter

Section 149 Certificates

There are two reasons why a Contract for Sale of Land may be out of date, or non-compliant with current law, in the early part of 2014.

The Environmental Planning and Assessment Regulation 2000 was recently amended  with the effect that the exempt and complying development provisions will now apply to more properties than previously.

As a result, Section 149 Certificates, which are a mandatory vendor disclosure document, issued by Councils before 23 February 2014 which state that complying development cannot be constructed on the land which is the subject of the Section 149 certificate, may not be correct..

If this is the case then the Vendor of the property would be in breach of the warranties set out in the Conveyancing (Sale of land) Regulation 2010 and any contract entered into using such an incorrect Section 149 Certificate could be the subject of rescission by a purchaser.

Care should be taken to ensure that an up-to-date Section 149 Certificate is used in any contract for sale of land.
 

It is, therefore very important to ensure that any Contract for Sale of land is prepared with up-to-date disclosure documents and that care is taken to ensure that all relevant disclosure documents are attached to it. It is also very important to allow sufficient time to obtain the required disclosure documents, in view of the time lags that are evident from the Government’s decision to delay the implementation of the requirements.
Swimming Pools – Update of Requirements – 31 March 2014
Disclosure document requirements in contracts relating to the sale of properties that have swimming pools, which are very broadly defined, are a problem that has now been the subject of the granting of additional time by the Government.
Pool owners have been required to register their pools on an on-line register provided by the New South Wales State Government since 29 April 2013.
HOWEVER, the Government proposed that, on and from 29 April 2014, Contracts for Sale of Land in respect of properties that contain a swimming pool (as broadly defined in the Swimming Pools Act 1992 (as amended) would have to have attached, as a mandatory disclosure document, either :-
  • A valid certificate of compliance issued by either the local Council or by an accredited certifier, or
  • A relevant occupation certificate and evidence that the swimming pool is registered under the Act.
The date for the proposed implementation of these requirements has, however, now been moved back by the Government to 29 April 2015.
Part of the reasons for delaying the implementation of these disclosure requirements was stated to be :-
  • Council officer feedback indicated that high inspection failure rates mean that it is not uncommon for it to take 3 months from the first inspection to the issuing of a compliance certificate,
  • The additional work being generated for repairs and upgrades to swimming pool barriers is placing pressure on pool trades and services, and
  • Councils can use this additional time to 29 April 2015 to increase awareness of property owners of the new requirements as well as ensuring that Councils have appropriate systems, processes and resources in place to be able to respond to requests from property owners for inspections, in a timely manner.
Failure to attach one of these documents in relation to a swimming pool to a contract entered into on or after 29 April 2015 will result in the Purchaser having the right to rescind the contract within 14 days after it is entered into.
The general definition of “swimming pool” in the Act refers to an excavation, structure or vessel that is capable of being filled with water to a depth greater than 300 millimetres and that is solely or principally used, or that is designed, manufactured or adapted to be solely or principally used, for the purpose of swimming, wading, paddling or any other human aquatic activity. This does not include most spas but it can include a spa in some circumstances. There are also some swimming pools that are exempt from some of the requirements of the Act.
It is, therefore very important to ensure that any Contract for Sale of land is prepared with up-to-date disclosure documents and that care is taken to ensure that all relevant disclosure documents are attached to it. It is also very important to allow sufficient time to obtain the required disclosure documents, in view of the time lags that are evident from the Government’s decision to delay the implementation of the requirements. 
If you require further assistance in updating your Contract for Sale of land, please contact:

John Cotter, Consultant
Phone: +61 2 9895 9234
Email: jcotter@colemangreig.com.au