Sec32 and Owners Corp Certificate

[juju]

Hi,

I am due to go unconditional on a new townhouse tomorrow.

The sec32 is missing the Owners Corp Certificate (sec151) and it is in the process of being prepared. I have heard conflicting opinions as to whether this is an issue or not in terms of proceeding with the sale from a legal point of view.

We have a condition on our CoS that the fees will not exceed a certain amount but are there any other implications we need to be aware of?

Thanks

 

[Terry_w]

Vendor is legally obliged to disclose certain information which the s32 contains. If part of this is missing then disclosure hasn't occured. This won't necessarily mean the contract is invalid but it may enable the purchaser to rescind - so silly for them to allow exchange perhaps.

Speak to a lawyer about this as I don't practice much property law myself so am probably wrong.

 

[The Y-man]

I am due to go unconditional on a new townhouse tomorrow.

When you say "new" is it "brand new" as in just finished construciton?

The Y-man

 

[juju]

When you say "new" is it "brand new" as in just finished construciton?

The Y-man

Yea, we would be the first owners. The REA couldn't take offers after our first inspection as they were waiting on Sec32, CoS, when they arrived we had them checked over by our conveyancer - no issues found bar the Owners Corp certificate pending.

I trust the advice our conveyancer has given but my partner has spoken to people who have told her that the vendor can't legally sell the property until the Certificate is issued....

 

[Aaron_C]

Well if the owners corporation certificate isn't there - then the section 32 isn't valid so disclosure has not occurred. See Sale of Land Act 1962 (Vic):

S. 32(3A) inserted by No. 69/2006 s. 219(2).

(3A) If the land is affected by an owners corporation within the meaning of the Owners Corporations Act 2006 , the vendor must attach to the statement required by subsection (1)(a) and to the contract—

(a) a copy of the current owners corporation certificate issued in respect of the land under the Owners Corporations Act 2006 ; and

(b) a copy of the documents required to accompany the owners corporation certificate under section 151(4)(b) of the Owners Corporations Act 2006 .

 

[juju]

Well if the owners corporation certificate isn't there - then the section 32 isn't valid so disclosure has not occurred. See Sale of Land Act 1962 (Vic):

S. 32(3A) inserted by No. 69/2006 s. 219(2).

(3A) If the land is affected by an owners corporation within the meaning of the Owners Corporations Act 2006 , the vendor must attach to the statement required by subsection (1)(a) and to the contract?

(a) a copy of the current owners corporation certificate issued in respect of the land under the Owners Corporations Act 2006 ; and

(b) a copy of the documents required to accompany the owners corporation certificate under section 151(4)(b) of the Owners Corporations Act 2006 .

Thanks Aaron, but the opinion seems to be that would work in my favour (purchaser) not the vendors?


We want to proceed with the sale, but the concern is, is the vendor legally able to sell the property?


Edit - to calrify, the Certificate hasn't been withheld, it is in the process of drafted/established.

 

[Aaron_C]

Thanks Aaron, but the opinion seems to be that would work in my favour (purchaser) not the vendors?

Yes, which was my point...

We want to proceed with the sale, but the concern is, is the vendor legally able to sell the property?

No he cannot. See section 32(5):

(5) Where a vendor:

(a) supplies false information to the purchaser in the statements or certificates required to be given by this section; or

(b) fails to supply all the information required to be supplied in the statements or certificates required to be given by this section?

the purchaser may rescind any contract for the sale of the land which has been entered into on the basis of that information at any time before he accepts title and becomes entitled to possession or to the receipt of rents and profits.

Edit - to calrify, the Certificate hasn't been withheld, it is in the process of drafted/established.

Doesn't matter. The legal requirements are the requirements...

 

[juju]

Appreciate your input Aaron...

Bit of a dilemma now as our finance extension expires tomorrow.

Will sleep on it and talk to our conveyencer.

Cheers

 

[Terry_w]

This is why it is a good idea to use a lawyer.

 

[juju]

I hear you...

Having read the requirements of the sec32 closer, I'm not able to find anything that suggests the sale would not be able to proceed ( title etc is all there)

What I have found and agree on is that as it it is incomplete, I as the purchaser can back out at any point before settlement due to the missing owners cert and/or if the vendor hasn't acted honestly or in good faith.

In summary, it seems to only negatively impact the vendor.

 

[The Y-man]

Bit of a dilemma now as our finance extension expires tomorrow.

Coud you clarify this bit? It is a bit mysterious to me....

The Y-man

 

[LexCon]

The Vendor's statement is defective without an owner's corporation certificate if the property is effected by an owners corporation.

A defective vendor's statement allows you to withdraw from the contract if you wish. What you should think about is how much are you prepared to pay for the oc fees . Are you just going on what you have been verbally told?You have entered into a contract without knowing what the ongoing costs will be to you.