Section 32 statements need not be attached to contract of sale

Please note for members of the public or practitioners in the legal profession where English is your second language a translation key in all languages worldwide is available on this blog to assist you. The plain English blog without translation facilities is located at http://roberthaypropertybarrister.wordpress.com

The vendor’s “section 32 statement” will not have to be attached to a contract for the sale of land following amendments to the Sale of Land Act 1962. See: s.4 of the Sale of Land Amendment Act 2014. The amendments have not yet commenced.  The latest day on which the changes can commence is 1 July 2015. See: s.2(3). The effect of the amendments is to replace s.32 in its entirety. Many of the changes do no more than restate the existing law.

The vendor’s statement need not be attached to the contract but must be given to the purchaser before the purchaser signs the contract. See: s.32(1). Where vendor’s statements have been given before the Act commences it will not be necessary to give a new vendor’s statement provided the land is not withdrawn from sale. See: the transitional provisions contained in s.6.

Some of the changes are:

(a)          the name of any planning overlay must be provided (s.32C(d)(iv));

(b)          there must be disclosure where a notice, order, declaration, report or recommendation of a public                 authority or government department or approved proposal that is “directly and currently affecting                   the land” (s.32D(a));

(c)          only non-connected services need be disclosed (s.32H);

(d)          where an owners corporation affects the land the vendor can provide prescribed information rather               than the owners corporation certificate (s32F);

(e)          vendors have to make available to prospective purchasers of vacant residential land a “due                           diligence checklist” which is in a form approved by the Director of Consumer Affairs (see new                       division 2A).

The “due diligence checklist” must be published on the internet site for Consumer Affairs Victoria.

A purchaser may rescind the contract where false information is provided, or information not provided, or no s.32 statement is provided. See: s.32K.

David Lloyd of counsel gave an excellent presentation about the changes to the Act at a recent seminar hosted by Green’s List and those wishing to know more should contact Green’s List to view David’s presentation. Click on the link Greens List.


Author: Robert Hays Barrister subject to copyright under DMCA.

My clerk can be contacted via this link http://www.greenslist.com.au/ if you wish to retain my services for any legal matter which is within the gamut of my legal experience.

Section 32 statements should disclose leases

Please note for members of the public or practitioners in the legal profession where English is your second language a translation key in all languages of the world is available on this blog to assist you. The plain English blog without translation facilities is located at http://roberthaypropertybarrister.wordpress.com

It has long been a vexed question whether a vendor of land needs to include details of a lease affecting the land in the vendor statement provided to a purchaser pursuant to s.32 of the Sale of Land Act 1962.  Section 32 requires the disclosure of, among other things,  mortgages and charges affecting the land but does not expressly require disclosure of a lease. The vendor is required to include in the statement  a “a description of any easement, covenant or other similar restriction affecting the land (whether registered or unregistered) and particulars of any existing failure to comply with the terms of that easement, covenant or restriction”. See: s.32(2)(b). It is established that s.32 should not be given a “narrow, restrictive construction having regard to the evident reformatory object of the leglislation”. See: for example, Vouzas v Bleake House Pty Ltd [2013] VSC 534 at [49].  In Krakowski v Eurolynx Properties Ltd (1992) V ConvR 54-436 ( BC9200732) O’Bryan J did not consider that s.32(2)(b) required a vendor to disclose the existence of a lease affecting the land. However, in IGA Distribution Pty Ltd v King [2002] VSC 440 at [252] Nettle J (as he then was) doubted that O’Bryan J was correct but did not specifically decide the issue. In Vouzas the vendor had disclosed the existence of the lease but had not disclosed that the tenant had entered into a conditional agreement to assign the lease. Macaulay J had to decide whether s.32(2)(b) required the vendor to disclose  that the tenant of the land being sold had entered into the conditional agreement to assign the lease.   The vendor knew about the conditional agreement to assign the lease. Macaulay J expressed the view that “the doubts expressed by Nettle J in the IGA case" concerning whether a lease need be disclosed were "well founded". However,  his Honour held that the vendor had not breached s.32(2)(b)  because that section did not oblige a vendor to disclose a conditional agreement to assign a lease. His Honour also said that “he was not convinced that an assignment of lease would need to be disclosed under s.32(2)(b").

My clerk can be contacted via this link http://www.greenslist.com.au if you wish to retain my services for any legal matter which is within the gamut of my legal experience. 

Author: Robert Hays Barrister subject to copyright under DMCA.