What could go Wrong at Unconditional?
A couple of things that could go wrong once a contract proceeds unconditionally is the finance. The Finance may not have been in place so there might be a couple of special conditions that the bank imposes that the clients weren’t aware of at the time. Examples could be, they require you to pay out of Visa cards prior to settlement just to bring your liability down and your serviceability up. Usually the client has already been alerted to that by the mortgage specialist so that’s not so much of a problem but from a conveyancing point of view, what we see go wrong the most or rather the most contested issue is the final inspection. A purchaser’s expectation of what they are to receive at the time of settlement versus what the vendor’s expectation is about what they need to deliver and in the case of a house, that include everything from the cleanliness of the property, how well it’s being cleaned, if at all. It can also mean the working conditions of the appliances, chattels and the fixtures and furnishings.
A lot of purchasers will come back to us and advise that they are not happy with these items and we’ll then work through that, determine and talk to the clients before submitting our requests to the vendor’s solicitor.
What is a material item and what is required. So the grass not being mowed is not a breach of contract.
So General Conditions 24 of the Contract of Sale which came into effect in 2008 now gives the purchaser the ability to, if contested, at settlement from the final inspection items and they are not in a satisfactory condition that the purchaser expects. An amount of up to $5,000 can be retain from the vendor’s money but must be matched by the purchaser with the equal amount. That money is held by a state holder pending resolution. And that gives the vendor the ability to proceed through to settlement without holding it up based on potentially a $1,000 or a $500 item that is in dispute. So General Conditions 24 sometimes can be overwritten or waive by a Special Condition. There are some of the special conditions that we have alerted earlier or looking out for.How does that adversely affected our purchaser’s position if they don’t have General Conditions 24 available to them upon settlement.