KEY TAKE OUTS:
- Risk for sellers to consider with the potential for damage to properties in NSW
- Risk for purchasers to consider with the potential for damage to properties in NSW
With the impact/threat of Cyclone Alfred it is important that both sellers and purchasers of property in New South Wales are aware of the risks and responsibilities of property damage during such natural disasters.
Who carries the risk if Contracts have already exchanged
In New South Wales the risk passes to the purchaser only on settlement. Therefore, the seller is liable for any damage that may be caused up until the settlement even if Contracts have exchanged conditionally or unconditionally.
The purchaser is entitled to receive the property at settlement in the same condition it was in at the time of exchange. This can be particularly hazardous for a seller with a longer than usual settlement period.
There are however exceptions to the above, such as when a purchaser has requested and taken early occupation/access of the property prior to settlement. A purchaser who takes early possession or occupation of the property also takes all the risk of the property at that time and is responsible for any damage/destruction that occurs from the date of possession until completion/settlement.
Providing vacant possession, inspections or extensions to timelines
If the property forms part of an area that is affected by a natural disaster and/or an evacuation order or the like, it may not be possible for the sellers to provide vacant possession at the required time or safe for purchasers to conduct an inspection. This may result in a settlement being delayed or a notice to complete being issued on the seller.
There may be deadlines such as cool off or settlement that also occur during such fraught circumstances which are unable to be met by one or more parties.
It is at times like these, although a legal obligation may not exist to provide compassion, one would hope the moral fabric of all the parties involved including agents, legal representatives and the like would shine through and show empathy and compassion for people already enduring the hardship of a disaster.
ABOUT KAY VITOGIANNIS:
Kay joined the Coutts team in May 2021 working as a Licensed Conveyancer within our Property & Conveyancing team, based in our Narellan office.
Kay has over 20 years of experience in the Legal industry. She began her journey in CBD Conveyancing firms as a secretary and attained her Advanced Diploma in Conveyancing in December 2010.
For further information please don’t hesitate to contact:
Kay Vitogiannis
Licensed Conveyancer
info@couttslegal.com.au
1300 268 887
This blog is merely general and non specific information on the subject matter and is not and should not be considered or relied on as legal advice. Coutts is not responsible for any cost, expense, loss or liability whatsoever in relation to this blog, including all or any reliance on this blog or use or application of this blog by you.
