Statutory Seller Disclosure Scheme – Executive Summary

Written by Lawyer, Elaina Hea

The Queensland Government proposes to implement a statutory seller disclosure scheme in Queensland, which aims to simplify freehold land contracts and empower buyers to make informed decisions about property dealings.

A formal seller disclosure scheme does not currently apply to the sale and purchase of freehold land in Queensland. The proposed regime will make it mandatory, with certain exceptions, for a seller to disclose relevant information to a potential buyer in a single document. Where relevant, this is to be accompanied by any prescribed certificates, including a body corporate certificate.

Disclosure Requirement

Prior to a contract being entered into by a seller with a buyer, the seller must provide the buyer with a disclosure statement for the lot and each prescribed certificate for the lot.

The disclosure statement must be in the approved form and signed by the seller.

A seller may give the disclosure statement or prescribed certificate to the buyer in:

• physical form;
• by electronic communication or
• by other electronic means via a link being given to the buyer, if the buyer has provided consent for this method.

Once the buyer signs the disclosure statement to acknowledge receipt prior to entering the contract, this provides evidence that the buyer received the statement and relevant prescribed certificates before entering the contract.

Approved form of disclosure statement

The disclosure statement requires the seller to provide information about the following:

• zoning of the lot under the local planning scheme;
• details of any unregistered or statutory encumbrance over the lot that will not be released at settlement;
• details of any current notice, order, or transport infrastructure proposal issued to the Seller
• any other matter prescribed by regulation

As part of the seller disclosure requirements, prescribed certificates are part of the documents to be given by the seller of a lot to the buyer. Below is a list of documents which are prescribed:

• current title search;
• registered survey plan;
• for a lot included in a community titles scheme:
  • body corporate certificate;
  • community management statement for the scheme;
  • any exclusive use by-laws or other by-laws in force not included in CMS
• for a lot included in a plan under Building Units and Group Titles Act 1980 – a body corporate certificate;
• any application or order under Neighbourhood Disputes (Dividing Fences and Trees) Act 2011, chapter 3;
• any pool compliance certificate or notice of no pool safety certificate;
• any notice required to be given to the buyer under the Environmental Protection Act 1994 (section 347, 362, or 408);
• any notice required to be given to the buyer under the Queensland Building and Construction Commission Act 1991 (section 47);
• most recent rates notice or if the lot is a rates exempt lot a statement by the seller that the lot is rates exempt;
• if the lot is not rates exempt but no separate assessment of rates is issued by a local government, a statement by the seller reflecting this;
• the most recent water services notice or for a lot where no separate water services notice is issued, a statement reflecting this.

Failure to comply with disclosure requirement

Where a seller of a lot fails to comply with the disclosure requirement, the buyer may terminate the contract for the sale of the lot by notice to the seller. Notice may be provided to the seller at any time before settlement.

The termination right for the buyer also arises if a disclosure statement or prescribed certificate was inaccurate at the time it was provided to the buyer and the inaccuracy concerns a matter affecting the lot. The right also applies if when the buyer entered into the contract, they were not aware of the correct state of affairs concerning the matter that affects the lot and had the buyer been aware, the buyer would not have entered into the contract.