Question
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05 July 2019

Slim pickings

Sale, Purchase, Mortgage, Lease
New South Wales

Asked

Conveyancing – Occupation certificates and purchaser protection

On what date did occupation certificates become compulsory? I understand they were required for works post 1992 but I am not certain of the exact date.

Prior to this time our local Council only has a copy of stamped plans, a building approval and at best a letter confirming inspections on file. Often the file has no such confirmation of inspections or just has a tick and initial on the back of the file to confirm the inspection is completed. Should a building certificate be recommended for every transaction where the property does not have an occupation certificate, even if constructed before they became compulsory?

Answered

Thank you for the question.

The regime for the issue of occupation certificates commenced on 1 July 1998.

It is a matter for each purchaser to satisfy themselves as to the condition of the property and its fitness for purpose.

The following is an extract from the By Lawyers enclosure ‘Initial advice to purchasers’ found in the Purchase of Real Property (NSW) Guide:

If, as is usually the case, the vendor does not have a building or occupation certificate from council, then there is no way of knowing from the contract whether the buildings were built with approval and passed for occupation for their intended use. If an inspection of the council file does not provide the information necessary to assess the compliance of the building, it may be necessary to obtain a council building information certificate. A current survey must accompany an application for such a certificate.

Under the Conveyancing Act 1919 and the Home Building Act 1989 some protection is afforded to purchasers of residential property in relation to faulty buildings. However we suggest that there is little comfort to be found in a right to sue for breach of warranty and it is best for a purchaser to thoroughly check the property and get pest and building reports before contracting. The warranty under the Conveyancing Act, amongst other things, provides that there is no matter in relation to any building or structure on the land that would justify the making of any upgrading or demolition order. The only remedy is rescission of the contract before completion and return of the deposit.

Regards

Mentor