FAQs for property buyers and sellers regarding impact of Coronavirus (COVID-19) on conveyancing

19 March 2020

1. What happens at settlement if the seller is in self-isolation at the home due to a COVID-19 infection or is under an order to do so?

Usually the seller needs to provide a buyer with vacant possession at settlement (unless the property is sold with a tenancy). If the seller cannot do this then they cannot perform their settlement obligations and the buyer cannot be compelled to settle and may have other rights depending on the standard contract terms and laws in that state.

In states where the time for settlement is of the essence (e.g. in Queensland) then a buyer could have the right to terminate the contract. In some other states (e.g. New South Wales and Victoria) a buyer would need to issue a notice to complete/default notice giving the seller 14 days to perform their settlement obligations (i.e. provide vacant possession) failing which the buyer could terminate the contract.

Lawlab have prepared special conditions to avoid these severe consequences and to manage these situations and we are now including these in all contracts we prepare.

Buyer and sellers should generally be prepared for these situations and consider alternative plans.

2. Should sellers clean properties to a standard?

Usually a seller needs to provide the property in a condition consistent with when the contract is entered into. There is usually no obligation to clean the property to a particular standard.

Sellers should consider following the advice from authorities in relation to cleanliness and wiping down surfaces to prevent the spread of the Coronavirus.

Buyers should consider inserting special conditions in contracts before they sign them if they require a property to be cleaned to a particular standard (e.g. a bond clean or for the property to be disinfected by a professional cleaning company (if possible)).

3. Will valuers and building and pest inspectors still have access to properties?

Usually a seller must give the buyer or its contractors (eg. inspectors, surveyors or valuers) access to the property before settlement. This will be difficult if the seller is in self-isolation or if the businesses for these contractors implement policies stopping them doing this.

If the contract is conditional upon satisfactory inspections or finance valuations then a buyer could request that these conditions are extended to factor in these circumstances.

Lawlab have prepared special conditions to manage these situations and we are now including these in all contracts we prepare.

4. What happens with paper settlements?

Usually at a paper settlement, representatives of all parties (buyer, seller, incoming and outgoing banks) attend a settlement venue and exchange documents and bank cheques. This will be difficult if some or all venues close down or have policies not to accept visitors or if settlement agencies stop sending their staff to attend these settlements.

This won’t be an issue in states where electronic settlements are mandatory (New South Wales, Victoria, Western Australia) but could be in other states. Electronic settlements are also available in Queensland and South Australia but require the other party to agree to settle electronically.

Lawlab will settle electronically whenever possible.

Lawlab have prepared special conditions to manage paper settlement problems and we are now including these in all contracts we prepare.

5. What if I can’t find someone to witness my signature on conveyancing documents?

Lawlab will prepare and send you electronic conveyancing documents to be signed electronically wherever possible.

In some states if you have to settle by paper then you may need some paper conveyancing documents witnessed (e.g. for sellers, the transfer document, or for buyers, the mortgage) and this may be difficult in a social distancing environment.

Lawlab have prepared special conditions to manage these situations and we are now including these in all contracts we prepare.

6. Can the other party cancel a contract because of Coronavirus?

Not specifically. A buyer or seller still needs to comply with their obligations under the contract. We expect that some buyers and sellers may rely on other terms or conditions of the contract to cancel or terminate a contract because of issues with or concerns regarding Coronavirus.

Buyers and sellers should seek legal advice before making decision regarding their contracts.

Lawlab are here to guide you through this difficult time.

7. Will lawlab be impacted?

Lawlab conveyancing services will not be interrupted by quarantine or isolation. The lawlab national team of lawyers are all remote work enabled and lawlab uses the full suite of digital tools such as Rundl, electronic contracts, remote VOI, electronic signatures and PEXA electronic settlements to ensure that your property transaction will settle successfully.

Unlike most conveyancers/settlement agents/lawyers whose practices revolve around face to face meetings; COVID-19 social isolation will be business-as-usual for lawlab. We pioneered digital contracts and have successfully bought and sold over 40 000 homes across Australia for clients of every age. Our service is not just for the young or tech savvy. If you are on Facebook you can work digitally with lawlab.

Lawlab’s friendly legal team will work with you remotely and keep you up to date via our industry leading digital platform Rundl as well as by video conference and telephone. Lawlab will continue to provide our highly rated services in this new COVID-19 ‘social distance’ environment.

Disclaimer This information is general in nature only and does not constitute legal advice. Lawlab accepts no liability for the content of this information. You should obtain legal advice specific to your individual circumstances. Lawlab’s liability is limited by a scheme approved under Professional Standards Legislation. Legal practitioners employed by lawlab are members of this scheme.
Richie Muir
Richie Muir
Legal Director

Richie is an experienced and commercially astute lawyer specialising in property law. He leads lawlab’s team of legal advisors and is the go-to problem solver for complex or unusual matters.  Having spent many years living and studying in Europe he now calls Brisbane home. Outside of work he juggles his time helping bring up his 2 young daughters, playing football and developing property.

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