From the 27th February 2009, there have been new requirements for local councils in relation to the issue of Section 149 Certificates under the Environmental Planning and Assessment Act 1979. Local councils will be required to put extra information on 149 Certificates that they did not have to do prior to 27th February 2009. Mostly, this information is only important for real estate agents to know, except with regards to how it impacts on exchanges for Contracts for the Sale of Land.
The Conveyancing Act 1919 requires that a vendor must prepare a Contract for the Sale of Land before exchange. For a Contract to be valid, a number of prescribed documents must be attached. One of those prescribed documents is a Section 149 Certificate.
Come the 28th February 2009, 149’s that are attached to existing marketing contracts will be out of date. Any contracts that are exchanged with the old 149 Certificates will mean the contract is not valid. Agents out there participating in exchange of contracts should be extraordinarily careful because the exchange may be flawed because of the old 149 Certificate being attached.
Obviously, the risk is lower for those exchanging on Private Treaty than on Auctions. For those on Private Treaty, there is a 5 day cooling off period during which time the vendor can rectify the problems. Nevertheless, if you exchange and the purchaser rescinds, the 0.25 may not be payable. The agent may become liable for this payment to the vendor.
In relation to auctions, or exchanges by real estate agents with 66W’s attached, we would suggest that you also be extraordinarily careful in relation to old 149 Certificates. If the issue date on your 149 Certificate is not dated 27th February 2009 or later, we would suggest that you do not exchange the contract until the vendor’s solicitor has provided you with a new 149 Certificate.
Some solicitors are belligerent and do not want to give you a new certificate because their clients, your vendors, are not wanting to spend the extra $44. If they will not give you a 149 Certificate, only exchange under the solicitors written authority. Protect yourselves and let the solicitors make the decision.
Until Next Time
Bailey Compton Leverage Australia & The Australian College of Professionals
