What the contract carries before it goes out
NSW has no separate statement: the seller’s disclosure documents are attached to the contract itself. The NSW Government’s selling page puts the core in plain words. The contract must contain a current zoning certificate (section 10.7) from the local council, the property certificate (title search), the registered plan and the dealings recorded on title, such as easements, a drainage diagram, and a statement of the buyer’s cooling-off rights in the prescribed form.
Schedule 1, Part 1 of the Regulation sets the list out item by item. For a house on its own title, these are the items that apply to every such house; the pool item (item 15) is below, in the Regulation’s order and in plain words:
- Item 1A planning certificate for the land
Required unless the land is outside every local government area.
- Item 2Sewerage diagrams
From a recognised sewerage authority, where it supplies them in the ordinary course, showing the sewer lines on the land up to the connection and the authority’s own infrastructure beyond it.
- Item 3A property certificate and the plan
For land under the Real Property Act 1900, other than the scheme lots covered by items 6 to 13: a property certificate, and the Registrar-General’s plan of the land, except for land in a limited folio.
- Item 4The instruments on the title
Every deed, dealing or other instrument lodged with the Registrar-General or registered, and shown on the property certificate, that creates or purports to create an easement, a profit à prendre, a restriction on the use of land, or a positive covenant imposed under Part 6, Division 4 of the Conveyancing Act 1919, burdening or benefiting, or purporting to burden or benefit, the land or part of it, with the memoranda those instruments refer to.
- Item 16Three printed notices
An “important notice to vendors and purchasers”, a smoke alarm warning, and a further warning addressed to buyers of homes built before 1985. The item does not apply where the notice is printed in the contract.
A lot in a strata scheme carries more. For a freehold strata lot, item 6 asks for a property certificate for the lot and the common property, the strata plan showing the lot, and the by-laws in force. Item 5 applies to a lot in a strata scheme and to a lot under a community, precinct or neighbourhood plan. It adds the instruments recorded on the property certificate for the common property or association property: every deed, dealing or other instrument lodged with the Registrar-General or registered that creates or purports to create an easement, a profit à prendre, a restriction on the use of land, or a positive covenant imposed under Part 6, Division 4 of the Conveyancing Act 1919, burdening or benefiting, or purporting to burden or benefit, that property or part of it, with the memoranda those instruments refer to. Items 7 to 14 cover leasehold strata lots, development schemes, registered strata management statements, community, precinct and neighbourhood schemes, and registered building management statements.
Two items depend on the home’s history. Where there is a swimming or spa pool, the buyer’s contract carries one of a valid certificate of compliance, an occupation certificate that is valid and was issued within the last 3 years together with evidence the pool is registered, or a valid certificate of non-compliance, except for a lot in a strata or community scheme of more than two lots or an off-the-plan contract. A buyer’s contract for a home sold within 7 years and 6 months of the issue of an owner-builder permit carries a consumer warning that the permit was issued. A home sold off the plan needs further documents, among them a Disclosure Statement.
The warranty behind the attachments
The conveyancing legislation also writes certain terms and warranties into the contract. Under Schedule 2 of the Regulation, the seller warrants, as at the date of the contract and except as the contract discloses, that the land has no adverse affectation and holds no part of a sewerage authority’s sewer, that the attached planning certificate states the land’s status on the matters the planning regulation lists, and that nothing about a building included in the sale would justify an upgrading or demolition order, unless a building information certificate has been issued since. The same warranty covers positive covenant charges and coastal protection charges.
What a buyer can do if the warranty proves wrong is not set out in this guide; the Regulation’s Part 5 governs it.
This is why the NSW Government suggests a solicitor or conveyancer prepare the contract, so the disclosure requirements are met.
Before the first advertisement
A residential property cannot be put on the market until a contract, prepared by a lawyer or licensed conveyancer, has been drawn up and made available. Where an agent is selling, the agent cannot change any part of the contract.
The land tax certificate
One certificate is served rather than attached, and the Regulation’s prescribed terms set its timing by the settlement date. Where the contract completes in 14 days or less, the seller must serve a current land tax certificate on the buyer on the day the contract is made, and the buyer need not complete before it arrives. Where completion is more than 14 days away, or no date is agreed, the seller must serve it at least 14 days before completion, and the buyer need not complete earlier than 14 days after it is served.
Exchange, and the 14 days after it
Neither buyer nor seller is legally bound until signed copies of the contract are exchanged. From then, a missing prescribed document matters: the buyer may be entitled to rescind within 14 days of exchange, unless settlement has already happened. If a contract is rescinded for a missing prescribed document, the Regulation says the seller must refund the deposit and any other money the buyer paid under it.
The seller has no cooling-off period: once contracts are exchanged, the seller must uphold the agreement. The buyer has a 5 business day cooling-off period after exchange, and a buyer who withdraws in that time pays the seller 0.25% of the price. There is no cooling-off period for a buyer at auction, or where contracts are exchanged on the same day as the auction after it is passed in. A buyer can waive the period by giving the seller a ‘66W certificate’, and an off-the-plan contract has a 10 business day period.