Replacing QLD’s Property Law Act 1974 with the more modern Property Law Bill 2023 is expected to deliver a more streamlined and transparent property law regime, but not everyone’s happy.

Given that the former Act predates the digital age, the new Act recognises the introduction of e-conveyancing, the shift to in-house stamping of most documents and transactions, and the move to electronic filing and records retention.

Based on recommendations from the Commercial and Property Law Research Centre at the Queensland University of Technology (QUT), Property Law 2023 (The Act) introduces a mandatory seller’s disclosure regime; changes to commercial leasing practice; and changes to how contracts for sale of land operate and settle.

Key changes

The commencement date may be delayed by up to 12 months to allow for consultation and education, but three key changes to look out for once the Act takes effect include:

Firstly, unlike some other Australian jurisdictions, Qld does not currently have any formal seller disclosure scheme.

The new Act attempts to remedy this by creating a statutory seller disclosure scheme that will apply to all freehold sales of land. This requires the seller to give the buyer a disclosure statement plus copies of a prescribed list of searches/certificates before the contract is signed – plus warnings about information that isn’t included.

The Act also provides that covenants in registered easements relating to the use, ownership or maintenance of the land – regardless of whether the covenants are positive or negative – will be binding on future landowners unless the covenants are expressed to be personal.

Under the current law, a positive covenant in an easement is not enforceable against successors in title unless the successor agrees to be bound. By comparison, Section 65 of the [new] Act will have a retrospective effect and apply to all easements, regardless of when the easement was entered into or registered.

Thirdly, the limitations period for bringing a claim in respect of a deed will be reduced to 6 years from 12 years. While reducing the limitations period removes one of the primary distinctions and one of the key advantages of using a deed, the proposed change will not affect existing deeds.

Other changes to the previous Act include:

• Rules relating to leases will be updated, with the introduction of additional protections for current and former lessees.
• The abolition of the rule against perpetuity for trusts over land in Qld and the introduction of a fixed perpetuity period of 125 years.
• Then there are numerous other changes and simplifications to rules relating to instalment contracts and adverse events under property contracts.

Non-compliance

While some categories are exempt from the proposed statutory seller disclosure scheme, the Act gives the buyer the right to terminate (the sale) if:

• If the seller doesn’t provide disclosure documents.
• If the seller provides disclosure documents that are inaccurate or incomplete in relation to a material matter.

We are also pleased to see provisions largely lifted from REIQ’s standard Contract into law, which deal with a delay to settlement due to an adverse event

The Real Estate Institute of Queensland (REIQ) welcomes modernised laws but deems certain provisions “impractical and ambiguous”.

While REIQ recognises the benefits of a single statutory disclosure regime – ensuring it’s easier for Queenslanders to make informed property buying decisions – the industry body believes sellers should only disclose information that’s within their knowledge, or that’s easily attainable by way of searches at no or nominal cost.

REIQ CEO Antonia Mercorella is disappointed that some material issues have not been duly addressed.

“In the case of the disclosure requirements at auction, there will be an opportunity to review at the 12-month mark and we highly anticipate revisiting what we have warned will be impractical and unnecessarily complex requirements,” said Mercorella.

“We are also pleased to see provisions largely lifted from REIQ’s standard Contract into law, which deal with a delay to settlement due to an adverse event (such as weather, public health emergency, act of terrorism, war or similar event).”

The reintroduction of Community Management Statement (CMS) disclosure when selling lots in a Community Titles Scheme is an illogical, retrograde step that does not contribute value for a buyer

Dangerous oversights

Other crucial matters raised by REIQ that Mercorella believes have been dangerously overlooked [by the new Act] include:

• Complex requirements associated with provision of a disclosure statement at auctions.
• The reintroduction of Community Management Statement (CMS) disclosure when selling lots in a Community Titles Scheme.
• Ambiguity around buyer termination rights.

“The reintroduction of Community Management Statement (CMS) disclosure when selling lots in a Community Titles Scheme is an illogical, retrograde step that does not contribute value for a buyer,” said Mercorella.

“Lastly, the Bill stipulates that a buyer may be entitled to terminate a contract of sale any time before settlement because the disclosure documents are not provided correctly, and we’re concerned about the ambiguity of how termination rights will apply with minor technical inaccuracies.”