No Comments

Property Law changes to Off-the-Plan Contract

As of 2 November 2015, property law in New South Wales has changed in relation to off-the-plan contracts, giving purchasers increased protection which make it harder for developers to enact sunset clauses to cancel contracts. This applies to all contracts for sale, even those already entered into.

A sunset clause is traditionally included in an off-the-plan contract in order to allow a buyer or developer to rescind if completion has been delayed. However, some developers have been using abusing these clauses, intentionally delaying a project in order to cancel existing contracts and then resell to new buyers at a higher price to reflect the current market. [...]  READ MORE →

No Comments

Duty to Mitigate Damages for Purchaser’s Default

A decision by the Supreme Court of South Australia, in Murphy v Mitanovski [2012], reiterates the importance of a vendor attempting to mitigate loss from a reduced sale price following a terminated contract.

Facts

In the above case, a purchaser entered into a Contract to purchase land for the sum of $782,000. The Contract was subsequently terminated by the vendor as a result of the purchaser’s failure to complete. Following the termination of the Contract in July 2010, the vendor retained the deposit and decided to hold onto the property. In late September 2010 the defaulting purchasers offered to buy the property again. The vendor rejected that offer and put the property to auction in late October 2010. By that time, the property had reduced in value and was sold at auction for $750,000. [...]  READ MORE →