Estate Agent Tip Number 1 – BCCMA Disclosure Statements
If you are selling a unit or a townhouse, a disclosure statement under the Body Corporate and Community Management Act 1997 QLD (BCCMA) is required for any lot in a community title scheme in Queensland. Failure to provide a disclosure statement to the buyer in accordance with the BCCMA will give the buyer a right to terminate the contract any time until settlement.
Apart from containing all the information required by Section 206 of the act, the disclosure statement must be:
1. Signed by the seller; and
2. Be given to the buyer before the buyer enters into the contract
We often see contracts come into this office where one or both requirements have not been met.
If the disclosure statement is signed by the seller after the contract has been signed by the buyer, section 206 will have been breached.
This can easily occur if the estate agent sends a blank contract and disclosure statement to the buyer by email to view; the buyer then signs the contract, then the agent takes the contract and disclosure to the seller, who then signs, possibly the next day.
The safest option is to have the seller sign the disclosure statement early in the listing process. Present the signed disclosure to the buyer first, then present the contract to the buyer. If emailing, the safest way would be to send the signed disclosure statement to the buyer in one email and then the contract in a second email.
You cannot contract out of the provisions of the BCCMA, therefore inserting a special condition that the contract is subject to the seller providing a disclosure statement does not rectify the breach.
If a buyer is ready to sign a contract and you do not have the disclosure statement ready, you should not present the contract to the buyer to sign. If the parties sign the contract before the disclosure statement is ready, then the seller will be bound to sell the property, however the buyer will not be bound to purchase the property. The seller has simply given the buyer a free option to purchase the property, which I’m sure that your client the seller will not be happy about.
By Pamela Pearce