Section 32 Victoria: When an Old Vendor Statement Needs Updating
/ David Dawn
Your Section 32 Was Prepared Six Months Ago. Is It Still Safe to Use?
A property is listed. The Contract and Section 32 are prepared. It does not sell, the campaign ends and the paperwork sits in the agency system.
Six months later a purchaser appears and someone says: “Good. We already have a contract.”
Maybe. But before that old pack is handed to a purchaser, there is one important question.
A Section 32 does not have a simple expiry date
There is no general rule that says every Section 32 automatically becomes invalid after three months, six months or twelve months.
That is not the real issue.
Section 32 of the Sale of Land Act 1962 (Vic) requires prescribed information about the property to be disclosed to the purchaser before the purchaser signs.
Consumer Affairs Victoria describes the Section 32 as a legal document that must be factually accurate and complete.
It is “Has anything changed since it was prepared?”
Owners Corporation properties are the obvious example
Where a property is affected by an Owners Corporation, the vendor must include an Owners Corporation certificate and accompanying documents in the Section 32 statement.
Consumer Affairs Victoria also notes that Section 32 statements are sometimes prepared up to 12 months before a property sells and suggests purchasers consider obtaining a fresh Owners Corporation certificate or inspecting the Owners Corporation records.
That is important because Owners Corporation information can change quickly.
What might have changed?
(a) annual Owners Corporation fees;
(b) special levies;
(c) insurance cover;
(d) AGM decisions;
(e) proposed works;
(f) building defects;
(g) litigation or VCAT proceedings;
(h) Owners Corporation rules;
(i) the Owners Corporation manager; or
(j) substantial new expenditure.
A certificate that correctly described the Owners Corporation six months ago may therefore no longer tell the complete story.
It is not only Owners Corporation information
Other information behind the Section 32 can also change.
Council and rates
New rates information may have issued, or Council may have served a notice or order.
Planning
A zone, overlay or planning scheme may have changed since the statement was prepared.
Building matters
The vendor may have undertaken works or received a building notice or order.
Tenancy
A previously vacant property may now be rented, or an existing tenancy may have ended.
Title
A dealing, caveat, mortgage or other title interest may have changed.
The vendor
A proprietor may have changed name, died, appointed an attorney or undergone another change affecting the transaction.
Age is not the only test
A Section 32 prepared two weeks ago is obviously different from one prepared ten months ago.
But something important can happen the day after a statement is prepared.
The real question is always whether anything has changed that affects the disclosure.
Agents do not need to audit it themselves
We are not suggesting an agent should conduct their own legal review of every Section 32 attachment.
The agent simply needs to recognise when an old pack may need attention.
“This Section 32 was prepared six months ago and the property is going back on the market. Please check and update it before we use it.”
When should an old Section 32 be sent back for review?
✓ The property has been withdrawn and relisted.
✓ The vendor has changed agents.
✓ The property has an Owners Corporation.
✓ An AGM has occurred.
✓ A levy or repair has been discussed.
✓ The vendor has carried out works.
✓ The property has become tenanted.
✓ Council has contacted the vendor.
✓ There has been a planning change.
✓ Anything else material has changed.
Further information
Consumer Affairs Victoria – Conveyancing and contracts for sellers
Consumer Affairs Victoria – Owners Corporation records and certificates
Victorian Legislation – Sale of Land Act 1962
Putting an older contract back on the market?
Send it back to us before it goes to the purchaser. We can review what has changed and update the Section 32 where required.
David Dawn
Licensed Conveyancer
Victorian Property Settlements
Post Office Box 11220
Frankston, Victoria 3199
David@quick32.com
