Let our experienced lawyers in Cairns help you draft your land contract to avoid contentious issues
A recent decision of the Supreme Court has highlighted the need for parties to land contracts to have their contracts carefully drafted by a lawyer, and to comply strictly with time limits in the contract. A commercial property was sold pursuant to a contract with a poorly worded, one line due diligence special condition. Just after 5pm on the date when the due diligence period expired, the seller gave notice to the buyer terminating the contract, as the buyer had not either waived the special condition or given notice that it was satisfied with its due diligence. The buyer argued that the seller could not terminate the contract, as the due diligence special condition did not say that the seller could terminate, and the condition was for the benefit of the buyer only. A few days after the seller gave notice of termination of the contract, the buyer tried to give notice of satisfaction of due diligence and paid the deposit. The seller maintained that this was too late. Ultimately the matter went to court, and the seller succeeded. The buyer lost the opportunity to buy the property, and incurred the cost of an unsuccessful court action, all because it had not taken more care with the wording of the contract, and failed to comply strictly with the time limits in the contract. A better prepared contract would have made clear the rights of the parties if the buyer failed to give notice within time, avoiding the court action, and more care by the buyer in observing the time limits might have avoided having the contract terminated.
Nigel Hales is a Queensland Law Society accredited specialist in Property Law. For more information regarding land contracts, contact our Partner, Nigel Hales today on 4036 9700.