The Property Law Bill 2023 will replace the current Property Law Act 1974. The most significant provision of the proposed Property Law Bill 2023 is the implementation of the Seller Disclosure Scheme.
What is the Seller Disclosure Scheme (SDS)?
The Property Law Bill introduces a framework under which a seller must give a buyer a disclosure statement and any certificates appropriate to the property. No doubt buyers and sellers will be confused as to what documents are due, when they are due and what they mean. Real estate agents will need to understand the SDS so that they can help their clients; legal advice must be sought to avoid liability. Below is a rough outline—please contact Bennett Carrol for professional advice.
What sellers have to provide and when they have to provide it.
A seller will be required to give the buyer a disclosure statement and any other applicable certificates before the buyer signs the contract.
The disclosure statement must
- contain the prescribed information,
- be in the approved form,
- be completed with information that is true at the time
- and be signed by the seller.
Prescribed certificate could be a
- title search
- registered survey plan
- pool compliance certificate
The disclosure statement and certificates may be given physically or electronically (timeframes are similar to those under the Electronic Transactions (Queensland) Act 2001).
Consequences of not providing a disclosure/providing an inaccurate disclosure
The consequences of failure to provide a disclosure or to provide an inaccurate disclosure vary from outright contract termination to contract termination because of “material prejudice”.
Buyers might be confused by the plethora of statements and certificates and might not understand the disclosure statement. Different disclosure documents are given at different times: before contracts are formed, before settlement and at time of settlement.
The buyer can terminate the contract prior to settlement if:
(a) the seller fails to provide the buyer with the disclosure statement and any applicable prescribed certificate; or
(b) the disclosure statement or a prescribed certificate contains an inaccuracy about, or is incomplete in relation to, a material matter and the buyer was unaware of the matter when the contract was entered into and would not have entered into the contract had they been aware of the correct state of affairs.
The only exception to the termination right is if the seller fails to comply with another Act. In such cases, the consequence provided in the other Act will apply.
Scheme Applies to ALL sales
The Scheme will apply to all sales of freehold land including;
- sales by auction,
- sales by a mortgagee or receiver
- and sales from the exercise of an option.
However, there are exceptions for example;
- if the buyer/s and seller/s are related and the buyer/s gives the seller/s a notice waiving compliance before buyer/s signs the contract
- if the seller is the Brisbane City Council
- if the buyer is the State or another State
(See section 100 for more details). NOTE: the Bill does not exempt a seller from making disclosures required under another Act, such as section 408 Environmental Protection Act 1994. Be sure to know when the SDS applies and when it doesn’t.
Where the sale is by auction, the Scheme distinguishes between the buyer who registers as a bidder before the start of an auction, and the buyer who registers as a bidder after commencement of an auction.
A buyer who registers after the start and who has not received the disclosure statement and prescribed certificates, simplified ‘service’ procedures are provided: for example, displaying a physical copy of the disclosure statement and prescribed certificates, or displaying a link to an electronic copy. The buyer may request physical copies of the disclosure statement and certificates prior to the conclusion of the auction.
The Scheme is a significant change to conveyancing in Queensland and it will be vital that people in the industry are familiar with it.
Please contact us for further advice and help.
Legal update on the Proposed Property Law Bill 2023
The Property Law Bill (Qld) 2023 was introduced to Queensland Parliament on 23 February 2023 – The Scheme is a significant change to conveyancing in Queensland and it will be vital that people in the industry are familiar with it. The proposed bill is over 120 pages long so we’ve summarised some key points.
- E-Property Laws
- Instalment Contracts
- Land Lotto – are you entitled to land?
- Seller Disclosure Scheme
Please contact us if you have any questions in relation to this matter or if we can assist you with any other legal matter. We have offices across South East Queensland with the capability to work electronically through Queensland and Australia.