When buying a residential house or unit, many buyers don’t realise that dates in the contract aren’t just important; they are critical. The standard contracts relating to the purchase of residential real estate in Queensland contain “time is of the essence” clauses. In short, this means a day late is too late.
Therefore if a buyer is a day late in paying the deposit, or a part of it, then the seller may terminate the contract. The seller may also be entitled to take (on forfeit) any deposit amount already paid and pursue the buyer for the balance deposit not paid plus any other loss suffered by the seller, including the seller’s legal fees.
Similarly, if the buyer’s bank is not ready for settlement on the date nominated in the contract, the buyer is at risk of the entire contract being terminated by the seller and the seller retaining the deposit. The seller may also have further claims against the buyer including the seller’s expenses associated with reselling the property and shortfall in price if they cannot find another buyer at the same price.
Other critical dates include those for:
- Building and pest inspections;
- Pool inspections; and
- Finance approval.
If any of these dates are missed, the contract is in danger of being terminated and parties are exposed to possible expensive claims and losses.
When buying or selling a property in Queensland it is imperative that all parties be aware that dates are critical and the parties, their lawyers and their financiers must be prepared for any deadlines set out in the contract.
Please contact us for further information on your property purchase or sale so that we can guide you through this and other traps that exist in conveyancing.