Vendors must now ensure that their property has compliant smoke alarms, or risk losing their sale contract.
The Conveyancing (Sale of Land) Amendment (Smoke Alarms) Regulation 2006 will affect all contracts for sale of residential property and some contracts for sale of commercial property. It provides that every contract must have attached a statement by the vendor that the building complies with the new regulations on smoke alarms.
If this statement is not included in the contract, the purchaser may rescind the contract any time within 14 days of the date of exchange of the contract. If the statement is incorrect, the vendor may be fined up to $550, but the purchaser is not entitled to rescind because of an incorrect statement.
The Department of Lands has taken the view that the new prescribed document only has to be attached to the contract from 1 November 2006. However, the more cautious approach would be to attach the prescribed document to contracts of sale from now on.
Changes in practice
The practical effect of the new legislation for most vendors is that they must either:
ensure that the house or unit has compliant smoke alarms installed at the time of making the contract; or
take the risk that the purchaser can rescind the contract for 14 days after exchange.
Conveyancing laws provide that a vendor statement of compliance must be attached to contracts of sale. By implication, it is clear that a vendor is not permitted to include a statement that the vendor has not installed the required smoke alarms (and that it is the purchaser’s responsibility after completion).
Further, a vendor is not permitted to include a statement warranting that smoke alarms will be installed by the completion date.
This effectively implements a practical method of enforcing the new regulations on smoke alarms. Instead of the Government performing spot checks of people’s homes, the policy is enforced through the conveyancing process.
NSW property owners who fail to install smoke alarms will be slapped with up to a $300 fine.
It will be an offence for owners of:
bed and breakfast accommodation
health care buildings
not to have working smoke alarms installed in their property. Fines of between $200 and $300 will apply, depending on the type of property.
The Environmental Planning and Assessment Amendment (Smoke Alarms) Regulation 2006 (EPA Regulation) sets out the type of smoke alarms that are acceptable. It also sets outs where the smoke alarms must be located. By Sally Tuckfield and Naomi Bangle
For more information, please contact:
t (02) 9931 4725
t (02) 9931 4906
t (02) 9931 4921
This publication is provided to clients and correspondents for their information on a complimentary basis. It represents a brief summary of the law applicable as at the date of publication and should not be relied on as a definitive or complete statement of the relevant laws.
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