A vendor of a unit needs to be aware of the requirement to
a pre-contract disclosure statement before the purchaser enters
into an agreement;
an additional disclosure statement, if requested by the
purchaser, no later than five working days after it is requested;
a pre-settlement disclosure statement, at least five working
days before the settlement date.
Vendors should be made aware of the perilous consequences of
failing to provide a pre-settlement disclosure statement or an
additional disclosure statement in time. If these statements are
not provided in time, the purchaser has two options:
postpone settlement to the fifth working day after the date on
which the latest disclosure statement was given; or
if the purchaser does not want to postpone settlement and would
prefer to cancel the agreement, section 151 of the Unit Titles Act
2010 allows the purchaser to cancel the agreement by giving the
vendor 10 days' notice in writing.
Cancellation of the agreement based on the failure to provide a
pre-settlement or additional disclosure statement on time seems
like a pretty severe penalty – nonetheless – that's
what the Act provides for.
Oddly, there are no consequences for not providing a
pre-contract disclosure statement. There is also no right to cancel
the agreement if the contents of the pre-settlement or additional
disclosure statements aren't satisfactory. It is appropriate
for purchaser to include a condition making the agreement subject
to their approval of the pre-settlement and any additional
Vendors should also be aware that they will not receive the
deposit until a pre-settlement disclosure statement, and additional
disclosure statement (if requested) is provided, and the purchaser
authorises the release of the deposit. This is another good reason
to issue these statements promptly.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
To print this article, all you need is to be registered on Mondaq.com.
Click to Login as an existing user or Register so you can print this article.
Please briefly describe the main laws that govern real estate in your jurisdiction.
Some comments from our readers… “The articles are extremely timely and highly applicable” “I often find critical information not available elsewhere” “As in-house counsel, Mondaq’s service is of great value”
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).