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Preparing Contracts? Don’t Do This!


By Barry van Heerden

With the real estate market gaining momentum, it is important that real estate agents pay attention to correctly describing the selling and purchasing entities when they are preparing Contracts (Qld) or providing a Sales Advice to legal representatives (NSW).

When you act for the seller, the first thing you should do is a title search to confirm the correct registered proprietor of the property. We have seen many cases of Contracts prepared in Qld where the actual person selling the property is completely different to the registered proprietor! This can happen in many ways but the most common case is where a spouse has died and the surviving spouse has not registered the death on the title. This is quite easy to fix when the surviving spouse is still around but it can get very complicated when both parties die and nothing has been done about obtaining probate to correct the ownership on the title.

Whenever there has been a death of one or both of the registered proprietors, you should check with the lawyers acting for the parties involved to get the description of the vendor correct and insert a special condition to cover the grant of probate or registration of a Transmission Application. Similarly, agents in NSW should investigate this issue fully before placing the property on the market and ensure that the soft copy of the Contract has an appropriate subject to probate clause. Sometimes the information as to the executors in the estate can only come from the latest Will of the deceased and this can become even more complicated if there is no Will!

It is also very important to correctly describe the purchaser in a Contract. You can no longer assume that your husband and wife purchasers will buy the property in their names. In many cases, the property will only be purchased in one person’s name or alternatively, in the name of a company or a trust. Sometimes there is a trustee company acting for a trust and there are many cases were superannuation funds can also purchase property. Once again, we have seen countless examples of the incorrect entity being inserted in Contracts with us having to attempt to later rescind the Contract and enter into a fresh Contract in the correct name. This obviously creates additional expenses for all parties and can sometimes lead to adverse stamp duty implications for the purchaser.

Although it may seem like a simple thing to obtain the correct details for the selling and purchasing entities, it is best to make a few phone calls to the relevant parties and make sure that you get this right. Sometimes this means that you need your clients to speak to their lawyers and/or their accountants before you can insert the details. This is difficult when you are attempting to sign someone up on the weekend or after hours but this can save you a lot of grief down the track if you follow these guidelines.

If you are unsure about how to describe a party in a Contract or what steps to take to verify this information, please do not hesitate to contact us.

For any enquiries please contact our Property and Commercial Department Manager, Jess Kimpton on 07 5506 8245 or email

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The contents of this article are considered accurate as at the date of publication. The information contained in this article does not constitute legal advice and is of a general nature only. Readers should seek legal advice about their specific circumstances. 

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