The commencement date for the Property Law Act 2023 (Qld) and associated regulations (new PLA) has been officially announced. Mark your calendars for 1 August 2025.
Some of the most significant changes to practice will be in the area of seller disclosure. We’ve detailed some key points you need to know about the new seller disclosure regime below. Additionally, the changes introduced by the new PLA will affect those working in all areas of property law practice, including leases, deeds, and easements.
It is essential to stay informed and prepared for these upcoming changes to ensure compliance and mitigate any potential risks. We will publish a more detailed summary of the changes in early 2025 (updating our previous blogs on this subject).
To learn more about the changes including the new disclosure requirements and how they will affect your business, please contact Leone Costigan, Julie Jankowski or Danica Corbett or your usual Herbert Smith Freehills real estate contact.
The new Seller Disclosure Regime in six key points
- New Disclosure Regime
Previously, sellers in Queensland had to disclose information to potential buyers under a mix of common law, statutory and contractual obligations. The new PLA simplifies this by extending disclosure obligations to all categories of freehold land (except for proposed lots) and consolidating some existing disclosure requirements.
- Why have the new rules
Under the new PLA, sellers must provide information they know or can easily find at a reasonable cost. The purpose for this disclosure is to provide valuable information to a buyer to assist in making their decision to purchase the property.
- Who must comply
All sellers must comply unless there is an exception from disclosure in the new PLA. The exceptions require a buyer to waive the disclosure requirements in some cases, but in other cases there is an automatic exemption if all eligibility requirements are met.
- What must be disclosed
The new PLA is very specific about the form and content of disclosure. It requires a disclosure statement in the approved form and documents prescribed by regulation (prescribed certificates) and must be given to the buyer before the contract is signed.
There are ‘double disclosure’ requirements for option deeds where there is a nominee provision. Disclosure must be made before entry into the option deed. If a nomination occurs, the seller must again provide the required disclosure documents before the nominee contract is entered into. The option deed must expressly cater for this process to ensure that a binding contract is entered into between the nominee and seller.
Disclosure requirements that may exist under other legislation will continue to apply and there are specific rules for sales by auction.
- Consequences of non-disclosure
If the seller fails to provide any prescribed disclosure document before the buyer or nominee signs the contract, the buyer has the right to terminate the contract at any point until settlement. The buyer does not need to suffer any negative impact to use its termination rights – the mere fact disclosure was omitted is sufficient.
Buyers may also have a termination right where information in the disclosure documents is inaccurate or incomplete and relates to a material matter affecting the property and the buyer was not aware of this information when it signed the contract.
- Impact
Whether the new regime is a positive change remains to be seen. For a seller, these new disclosure requirements will add to the complexity and cost of transactions. There are also harsh consequences for sellers if a disclosure statement is not given or is inaccurate in any material matter.
Buyers should keep in mind that the disclosure documents do not necessarily contain all information they should consider when purchasing property – further due diligence may be required.
However, for all parties the consolidation of seller disclosure requirements for nearly all land types should make the sale process more transparent.
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