New editions of the Contract for Houses and Residential Land and Residential Lots in a Community Title Scheme will be released by the REIQ on 20 January 2022. Although there are a number of changes which will be reviewed in more detail when the contracts are issued, the most significant change to the standard terms of each contract is the insertion of an ability for either the buyer or the seller to extend the settlement date for up to 5 Business Days after the scheduled Settlement Date.
The QLS and REIQ have made comments indicating that that the new right to extend the settlement date has been provided in response to reports of buyers losing their deposit in situations where the contract has fallen over due to last minute delays caused by banks.
Interestingly, the new clause allows a party to extend settlement simply by giving notice to the other party without any restrictions and without any requirement to produce supporting evidence detailing the reasons for the extension. Although residential buyers may welcome the changes, it seems possible that the new clause is open for exploitation by parties that are unable to complete due to their own actions.
If you intend to execute a contract on or after 20 January 2022, we suggest that you carefully review the terms with your lawyer.
Shand Taylor Lawyers have completed numerous contract reviews for buyers and sellers and our commercial team would be happy to assist.
Richard Waring, Director (07) 3307 4545 rwaring@shandtaylor.com.au
Matthew Shannon, Director
(07) 3307 4506
Patrick Sherlock, Senior Associate
(07) 3307 4542