23 March 2018
Purchase - Remedy if property enquiries reveal adverse affectation
Which law allows a purchaser to rescind a contract if the property enquiries reveal an affectation?
Thanks.
Thank you for the question.
The purchaser has a contractual right to rescind for the breach of a statutory warranty. The following is an excerpt of the prescribed warranty which appears in full in the By Lawyers contract and the consequent rescission clause:
Prescribed warranties
By operation of s 52A of the Conveyancing Act 1919 and the Conveyancing (Sale of Land) Regulation 2017 there is implied in this contract a warranty by the vendor that, except as otherwise disclosed in this contract, at the contract date:
(a) The land is not subject to any adverse affectation...
The purchaser may rescind for breach of a prescribed warranty at any time prior to settlement if:
(a) The breach of warranty relates to a failure to disclose a matter affecting the land; and
(b) The purchaser was unaware of the matter affecting the land; and
(c) The purchaser would not have purchased the land if the purchaser had been aware of the matter affecting the land...
Regards
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