Seller Disclosure Scheme Queensland : Conveyancer Guide

A new Statutory Seller Disclosure scheme to be required for Queensland conveyancing transactions.

Previously Queensland did not have a formal seller disclosure scheme for selling or buying residential land, however, with the passing of  The Property Law Act 2023 (the New Act) a new Statutory Seller Disclosure scheme will be introduced. The starting date for the new act and Seller Disclosure has yet to be set by the Queensland Government but it is expected to be in 2024. 

Traditionally Queensland law has placed the risk on the Buyer to search for any defects or faults in a property with no requirement of the Seller to disclose relevant information. 

Buyers have relied upon added special conditions so that they may satisfy their inquiries about the property before proceeding with the completion of a conveyance and ownership.

CONVEYANCING FAQs SELLERS

Why is a new seller disclosure statement necessary for a Queensland conveyance?

There exists now a variety of complex common law and statutory contractual obligations placed on the Seller. The new act will seek to simplify and streamline the conveyancing process whilst increasing transparency of property information between the Buyer and the Seller.

Specifically The New Act will bring together all of the common law, statutory, and contractual seller disclosure obligations into a single statutory Seller Disclosure Scheme.

Who does the new act apply to in a Queensland conveyance?

The new scheme will place obligations on the Seller to provide basic searches and relevant certificates before a contract is agreed upon. 

The statutory Seller Disclosure Scheme as enacted in the New Act will be applicable to sales of all freehold land, including sales by auction, subject to several exemptions.

These conveyancing changes will increase transparency between all parties and allow buyers to be well informed before entering into a house and land contract to purchase a Queensland property. In addition it will balance the costs of information and property searches between the Buyer and Seller. 

Exceptions to the proposed law:

If the Buyer is a local or state government agency, whereby instead Sellers of freehold land are required to disclose relevant information to proposed Buyers in a document with any prescribed certificates.

How does this change the conveyancing process for Sellers?

The Seller is now required to deliver a disclosure statement to the Buyer before the Buyer signs a contract to purchase the property. 

Specifically the warranties in the Seller Disclosure statement will give the Buyer the option to terminate the contract at any time before settlement if:

1. The Seller fails to give the required disclosure statement or

2. The disclosure statement is incomplete or inaccurate in a material matter affecting the property and if the disclosure statement had been accurate the Buyer would not have signed the contract.

In addition if the Buyer terminates they will be entitled to a full refund of any deposit paid.

The draft Bill provides that a seller’s failure to comply with the statutory disclosure requirements may entitle the buyer to terminate the contract at any time prior to settlement or claim damages, depending on the circumstances.

What will the disclosure statement include?

This new disclosure must be signed by the Seller and in the approved form, including all information that is true at the time it is given to the buyer 

Draft of the Disclosure Statement

The seller must provide to the Buyer

1. The disclosure statement 

2. any prescribed certificates (the Disclosure Documents) pertaining to the lot. 

What are Prescribed certificates?

They include any certificates applicable to the lot, and they may be any document that is required to be given to the buyer under another act. These include:

• current easements, covenants or encumbrances affecting the property

• any tree orders or applications affecting the property

• that no written notice is not required under the Environmental Protection Act 1994

• that no building work has been carried out by an unlicensed person in the last six years

• that there are no warranties given about the structural soundness of the building or improvements on the property

• any current orders, notices or transport proposals affecting the land issued by a relevant authority that may affect the title or use of the land after settlement.

Depending on the property type, the seller is required to give certain documents with the disclosure statement, including the following:

• current title search

• registered survey plan

• body corporate certificate

• community management statement for the community titles scheme

• pool compliance certificate

• tree order under the Neighbourhood Disputes Act

• unlicensed building work under the Queensland Building and Construction Act

• rates notice

• water services notice

• notice regarding a transport infrastructure proposal

The statement does not include information about:

• flooding history

• structural soundness of the building or pest infestation

• current or historical use of the property

• current or past building approvals for the property

• limits imposed by planning laws on the use of the land

• services that are or may be connected to the property

Excluded CONVEYANCE Transactions

1. Where the Buyer and Seller are related 

2. Where the Buyer is the State or Local Government or Council and other limited situations

When & How Will the Disclosure Documents Need to Be Given?

The Disclosure Documents will need to be given by the seller to the buyer before the buyer signs the contract for the purchase of the relevant lot either physically or electronically.

What Happens if I Do Not Comply With the Statutory Disclosure Scheme?

The Seller Disclosure Scheme gives the buyer the right to terminate the contract for sale at any time before settlement if the seller fails to provide any of the Disclosure Documents at the relevant time or provides Disclosure Documents that are inaccurate or incomplete regarding a material matter.