Danny Arraj

The Conveyancing Legislation Amendment Bill 2018 (Bill) was assented to on 22 November 2018. Its focus is on providing added protection for purchasers by clamping down on the ability of vendors to make changes to key documents after exchange of off-the-plan (OTP) contracts.

Disclosure Regime

The Bill introduces an additional vendor disclosure regime, which requires a vendor disclosure statement to be attached to all OTP contracts before they are signed by a purchaser. The disclosure statement must include:

  • a copy of a draft strata plan prepared by a registered surveyor; and
  • any other prescribed documents.


It is not known at this stage what will constitute prescribed documents. This will be clarified when the Regulations are released in early 2019.


Notification Requirements

The vendor disclosure statement must be accurate. If changes occur to prescribed documents between exchange and completion that renders the disclosure statement inaccurate, the vendor will be obligated to notify all purchasers of these changes.

Any changes to the prescribed documents must be notified to purchasers at least 21 days prior to completion pursuant to s66ZN of the Conveyancing Act 1919 (NSW) (Act). Applicable penalties for failing to meet the notice requirements will be outlined in the Regulations.


Purchaser’s Rescission Rights

The Bill gives purchasers a statutory right to rescind contracts if the disclosure statement contains an inaccuracy regarding a material particular that:

  • is materially prejudicial to the purchaser; and
  • had the purchaser known of the inaccuracy, they would not have entered the contract.


A material particular includes but is not limited to, changes in the draft strata plan, by-laws, schedule of finishes or the creation of easements or covenants that will affect the use or enjoyment of the purchaser’s lot.

If the vendor issues the required notice the purchaser may, within 14 days, elect to rescind the  contract. If the purchaser elects to rescind, they must give written notice to the vendor or vendor’s solicitor, signed by the purchaser or purchaser’s solicitor. If the purchaser does not serve a notice or if notice is not validly served, the disclosure statement will be amended to include the vendor’s changes and the purchaser’s right to rescind will terminate.

The onus is on the purchaser to establish that the change is materially prejudicial and that they would not have entered the contract if they were aware of it at the time.

If a valid notice is served, the contract is rescinded and the deposit paid under the contact must be returned to the purchaser.



The most significant change is the obligation on the vendor to serve on the purchaser a copy of the registered strata plan together with any documents registered with the strata plan (i.e. by-laws, s88b instrument). The purchaser is not required to complete the contract earlier than 21 days after receiving copies of the registered  documents. This is irrespective of the completion date specified in the contract.


Our Recommendation

To minimise the risk of rescission, we recommend vendors carry out greater due diligence to ensure that all prescribed documents are accurate and drafted to final form (or as near to final form as possible) when disclosed in the contract.

If variations made to the prescribed documents prior to completion are minimal, there will be less opportunity for purchasers to seek rescission under sections 66ZO and 66ZP of the Act.

A further update will follow once final approval to the Bill has been received.


If you would like to discuss the potential impact of these changes, please contact Danny Arraj or a member of the Blackstone Waterhouse Property team.

Danny Arraj
Managing Partner
T: 02 9279 0288
E: darraj@bwl.com.au

Melanie Howard
Senior Associate
T: 02 9279 0288
E: mhoward@bwl.com.au

Andrew Zeidan
Law Graduate
T: 02 9279 0288
E: azeidan@bwl.com.au



This BWL Update should not be used as a substitute for the legislation or professional advice and does not, and is not intended to, offer professional advice in any form. Blackstone Waterhouse Lawyers is more than happy to assist in that regard. No warranty or guarantee of any kind is provided by Blackstone Waterhouse Lawyers relating to, and no liability is accepted for, any loss or damage resulting from any person relying on or using the information contained in this BWL Update.

This article has been prepared by Danny Arraj for Blackstone Waterhouse Lawyers. Copyright © 2019. All rights reserved.