Land Sales Act 1964 (NSW)

Land Sales Act 1964 No 12 An Act to regulate sales of certain land; to amend the Conveyancing Act 1919 and certain other Acts in certain respects; and for purposes connected therewith. Part 1 Preliminary 1 Name of Act and commencement (1) This Act may be cited as the Land Sales Act 1964. (2) This Act shall commence upon a day to be appointed by the Governor and notified by proclamation published in the Gazette. 1A (Repealed) Part 2 1B–1E (Repealed) Part 3 Sale of land under instalment contracts 2 Definitions In this Part, unless the context or subject matter otherwise indicates or requires— Instalment contract means a contract, entered into after the commencement of this Part, for the sale of a lot in a subdivision comprising five or more lots where such contract provides for the purchase money to be paid by four or more part payments (whether by way of preliminary or other deposit or otherwise) and any option to purchase such a lot under which all or part of the consideration for the granting of such option (whether or not such consideration is to be applied to the purchase price) is payable by four or more part payments as aforesaid, but does not include— (a) a contract effecting a sale without resubdivision by a vendor who acquired less than five lots in a subdivision, or (b) a contract for the sale of a lot, or a leasehold interest in a lot, within the meaning of the Strata Schemes Development Act 2015. Licensed conveyancer means the holder of a licence in force under the Conveyancers Licensing Act 1992. Preliminary deposit means an initial payment (not being a payment, or part payment, for an option, other than an option referred to in the definition of instalment contract in this section) by a person in connection with the proposed purchase of a lot in a subdivision made to a person, or the agent of a person, who has offered, or held himself or herself out as being willing, to sell, or has advertised for sale, such lot, where the payment is made before there is a contract between such persons for the sale and purchase of such land. Primary application means an application to the Registrar-General to bring land under the provisions of the Real Property Act 1900. Purchaser includes a person (not being a person acting in the capacity of an agent for a vendor) by whom or on whose behalf a preliminary deposit is paid to a vendor. Sell includes offer to sell, hold oneself out as being willing to sell, and advertise for sale. Subdivision has the meaning given to subdivision of land by section 4B of the Environmental Planning and Assessment Act 1979. 3 Sales by instalment contracts of lots in subdivisions No person shall sell under an instalment contract any lot unless the subdivision in which the lot is comprised complies with the provisions of this Part. 4 Requirements as to subdivisions A subdivision complies with the provisions of this Part if, at the time of the sale— (a) (i) the land comprised in the subdivision is under the provisions of the Real Property Act 1900, or (ii) (Repealed) (iii) although the land comprised in the subdivision is not under the provisions of the Real Property Act 1900, a plan of such subdivision has, before the commencement of this Act, been registered in the office of the Registrar-General, and (b) the boundaries of the various lots in the subdivision follow the boundaries shown in a plan of subdivision that is endorsed with a subdivision certificate within the meaning of section 109C of the Environmental Planning and Assessment Act 1979, and (b1) in the case of a subdivision that requires development consent under the Environmental Planning and Assessment Act 1979, such a consent is in force, and (c) a trustee holds office under a trust deed that— (i) relates to the subdivision, (ii) complies with the provisions of this Part, and (iii) has endorsed on it in writing the Minister's approval of the trust deed and the trustee appointed thereby. Any approval referred to in paragraph (c) may be given subject to such terms and conditions as the Minister thinks fit. 5 Approval of trustee may be revoked (1) The Minister— (a) may by notice published in the Gazette revoke as on and from a day (not being earlier than the date of publication of the notice) to be specified in the notice the Minister's approval under this Part of any trustee appointed under a trust deed, and (b) shall in any such notice specify a date on or after which the Minister proposes to exercise the Minister's powers under subsection (3) unless a new trustee, approved in writing by the Minister, has before that date been appointed to act in the place of the former trustee. (2) Any such revocation shall take effect on and from the day specified in the notice and referred to in subsection (1) (a) and thereupon the trustee shall cease to hold office as such trustee for all purposes. The Minister shall as soon as practicable after publication of the notice cause a copy of the notice of revocation to be served on the trustee and the vendor by whom, or for whom and on whose behalf, the trustee was appointed. (3) Where the Minister revokes the approval of any trustee as aforesaid and the vendor fails, before the date referred to in subsection (1) (b), to appoint a new trustee, approved in writing by the Minister, to act in the place of the former trustee the Minister may, by a trust deed executed by the Minister for and on behalf of the vendor (which trust deed the Minister is hereby authorised to execute) and that complies with the provisions of this Part, appoint, upon such terms and conditions as the Minister thinks fit, a new trustee to act in the place of the former trustee but only as regards the powers, authorities, duties and functions of the former trustee so far as they relate to sales of lots made before the appointment of the new trustee and to purchasers of such lots and the new trustee so appointed shall be deemed for the purposes of this Part to be the trustee under the trust deed in respect of sales of lots made before his or her appointment. Any terms and conditions (including terms and conditions providing for the remuneration of the new trustee by the vendor or out of moneys held by the new trustee on behalf of the vendor) upon which the appointment of a new trustee may be made as aforesaid and that are expressed to be binding on the vendor and any covenants or provisions in the trust deed appointing the new trustee that are expressed to be made on behalf of, or to be binding on, the vendor shall be deemed to be terms and conditions binding on, covenants by and provisions binding on, the vendor. (4) Nothing in this section prevents the vendor, where the Minister has appointed a new trustee in accordance with this section, from appointing a further trustee in accordance with the provisions of the trust deed under which the former trustee was appointed, to act as trustee under the trust deed in respect only of sales of lots made after his or her appointment. 6 Exemptions (1) The Minister may by order published in the Gazette declare that the requirements of section 4 (c) and such other provisions of this Part as may be specified in the order shall not apply to or in respect of any subdivision specified in the order and any such order shall have effect according to its tenor. (2) An instalment contract for the sale of a lot in a subdivision of land under the provisions of the Real Property Act 1900, being a contract under which the vendor of the lot is— (a) a statutory body representing the Crown, or (b) a local council, is exempt from the provisions of this Part. 7 Trust deeds (1) A trust deed complies with the provisions of this Part if it— (a) makes provision for the appointment by the vendor for such period as the Minister may approve after the date of the certificate referred to in section 4 (b) of a person as trustee for purchasers of lots in the subdivision proposed to be sold, (b) (i) provides for the appointment by the vendor of a new trustee approved by the Minister to act under the trust deed, where the former trustee ceases for any reason to hold office before his or her duties as trustee have been completed, and also provides that such appointment shall be made subject to such terms and conditions as the Minister may think fit and for such period as the Minister may approve, and (ii) contains a covenant binding the trustee that the trustee will, upon ceasing to be a trustee, transfer to the trustee appointed by the vendor under subparagraph (i), or by the Minister under section 5, any money held by the trustee or on the trustee's behalf, and any books of account kept by the trustee, in his or her capacity as such trustee, (c) has annexed thereto a copy of the form or forms of instalment contract to be used in connection with the sale of the land comprised in the subdivision (which form or forms shall provide that all moneys payable thereunder by way of preliminary or other deposit or fifteen per centum of the purchase price (whichever is the greater) shall be paid by the purchaser to the trustee) and the form or forms of mortgage to be used for the purposes of section 13, (d) contains a provision that all moneys received by the trustee from a purchaser under an instalment contract shall be retained by the trustee until the trustee has been authorised by the vendor to refund any such moneys, or— (i) the trustee is satisfied that the purchaser has been given the notices prescribed in section 12, and (ii) an instalment contract signed by both the vendor and the purchaser or their properly constituted attorneys has been presented to the trustee for inspection and the written authority of the purchaser to account to the vendor for such moneys has been furnished to the trustee, (e) contains a covenant binding the vendor that the vendor will, upon demand made by the trustee or any registered public accountant appointed by the trustee, make available for inspection the whole of the books of the vendor relating to the subdivision to which the trust deed relates and give to the trustee or to any such registered public accountant such oral or written information as the trustee or registered public accountant requires with respect to the subdivision to which the trust deed relates where inspection of such books or such information is necessary for the proper and effective carrying out of the trustee's powers, authorities, duties and functions under this Part and the trust deed, (f) contains covenants binding the trustee that the trustee will— (i) exercise all due diligence and vigilance in carrying out the trustee's powers, authorities, duties and functions in watching the rights and interests of the purchasers of lots in the subdivision to which the trust deed relates, (ii) punctually account for all moneys paid to the trustee in pursuance of this Part in accordance with the provisions of this Part and the trust deed, (iii) keep or cause to be kept proper books of account with respect to all moneys paid to the trustee as aforesaid, (iv) where the trustee has received fifteen per centum of the purchase price of any lot in a subdivision to which the trust deed relates, serve on the purchaser of such lot a notice in writing duly completed in or to the effect of the First Schedule, and on the vendor of such lot a notice in writing in or to the effect of the Second Schedule, and (v) where the trustee has received a notice referred to in section 14 (1), serve on the purchaser a notice in writing duly completed in or to the effect of the Third Schedule, (g) shall specify addresses for the service of any notice or document respectively on the vendor and trustee in their capacities as such. (2) Any trustee or registered public accountant who except in the course of any court proceedings, divulges or communicates to any other person any information which the trustee or registered public accountant has acquired pursuant to subsection (1) (e) shall be guilty of an offence under this Act— Provided that nothing in this subsection precludes a trustee from divulging or communicating any such information to the Minister, or any such information that relates to the sale of a particular lot to the purchaser of that lot or the purchaser's solicitor or licensed conveyancer. 8 Certain advertisements prohibited No person shall publish or cause to be published any advertisement referring to a subdivision and containing a statement that, or to the effect that, a trustee or trust deed has been approved by the Minister or referring in any way to this Act. 9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract (1) Where a vendor or the vendor's agent accepts a preliminary deposit in connection with the sale of a lot in a subdivision and such preliminary deposit is paid pursuant to an agreement (whether oral or in writing or partly oral and partly in writing), implementation of which would necessitate the vendor and purchaser entering into an instalment contract, the vendor or the vendor's agent accepting the preliminary deposit shall upon doing so give to the person paying the preliminary deposit a receipt on which are endorsed the words "sale by instalment contract". (2) Where a vendor or the vendor's agent gives to a person paying a preliminary deposit a receipt on which are required to be endorsed the words "sale by instalment contract", the vendor— (a) shall within seven days after the preliminary deposit was paid pay the amount of the preliminary deposit to the trustee under the trust deed relating to such subdivision and either— (i) tender to the purchaser for execution by the purchaser a copy of an instalment contract for the sale and purchase of the lot in connection with the sale of which the preliminary deposit was paid, such contract having annexed thereto or endorsed thereon an undertaking by the vendor that the vendor will refund to the purchaser an amount, not exceeding an amount stated in the undertaking, for the reasonable costs incurred by the purchaser as a client of a solicitor or conveyancer in procuring such advice relating to the proposed transaction and the provisions of this Part as the solicitor or conveyancer is obliged, upon an examination of the contract and the particulars of title given to the purchaser by the vendor, to furnish to the purchaser, as the client of the solicitor or conveyancer, or (ii) authorise such trustee to refund to the purchaser the amount of the preliminary deposit and notify the purchaser in writing that the vendor is unwilling or unable to execute such an instalment contract, and (b) where the vendor tenders to the purchaser a copy of the instalment contract in accordance with paragraph (a) (i), shall not, for the prescribed period, sell or cause to be sold the lot comprised in the instalment contract to any person other than the purchaser except where the purchaser and the vendor have agreed in writing that the vendor is not required to comply with the requirements of section 10 (2) and the vendor has authorised such trustee to refund to the purchaser the amount of any preliminary deposit paid by the purchaser. In this paragraph the prescribed period means a period of fourteen days after the date on which the vendor tenders to the purchaser a copy of the instalment contract in accordance with paragraph (a) (i) and, where the provisions of section 10 (2) (a) and (b) have been complied with, a further period of seven days after the expiration of the said period of fourteen days. (3) The amount for reasonable costs stated in the undertaking under subsection (2) (a) (i) may be varied by agreement in writing between the vendor and purchaser at any time before execution of the instalment contract by the purchaser. 10 Form of instalment contracts (1) A vendor under an instalment contract, or the vendor's agent, shall not tender to a purchaser a copy of an instalment contract for the sale and purchase of a lot unless the instalment contract is in the form, or one of the forms, of instalment contract annexed to the trust deed relating to the subdivision in which the lot is comprised. (2) Within twenty-one days after tendering a copy of the instalment contract to a purchaser, the vendor shall deliver or cause to be delivered to the purchaser a counterpart of the contract duly executed by the vendor or the vendor's duly appointed attorney, if— (a) the copy of the instalment contract so tendered has been executed by the purchaser and has, within fourteen days after its having been so tendered, been delivered to the vendor or the agent of the vendor, and (b) the purchaser has complied with all terms and conditions required by the instalment contract to be complied with by the purchaser at or before the delivery to the purchaser of the counterpart of the contract duly executed as aforesaid. 11 Vendor not to accept payment of instalments until 15 per cent of purchase price paid No person, other than the trustee under the trust deed relating to the subdivision in which the lot is included, shall accept any payment, other than a preliminary deposit, made by or on behalf of a purchaser of a lot under an instalment contract unless the vendor has been given a notice in writing, duly completed, in or to the effect of the Second Schedule by such trustee that fifteen per centum of the purchase price payable under the instalment contract has been paid by or on behalf of the purchaser, but nothing in this section prevents any person from accepting any such payment from such trustee. 12 Notices to be given to purchasers (1) No person shall receive an initial payment (whether by way of preliminary or other deposit or otherwise) in connection with an instalment contract unless, before receiving such payment, the person gives or causes to be given to the purchaser a notice in writing duly completed that is in or to the effect of the form in the Fourth Schedule and that complies with the requirements of this section and a notice in writing in the form in the Fifth Schedule and no person shall tender an instalment contract for execution by a purchaser unless at least twenty-four hours before so tendering such contract the person gives or causes to be given to the purchaser such notices. (2) (a) The notice in or to the effect of the form in the Fourth Schedule— (i) shall be signed by the vendor or by the vendor's duly appointed attorney and the signature shall be attested by a witness, or (ii) where the vendor is a company, shall be under seal or shall be signed by an attorney of the company duly appointed under seal. (b) Any such notice purporting to have been signed by an attorney shall be deemed to have been signed by the vendor or to be under the seal of the company as the case may be unless it is proved that such signatory was not authorised in that behalf. (3) It shall be a failure to comply with the requirements of subsection (1) if any notice given to the purchaser in pursuance thereof— (a) is in handwriting that is not clear and legible, or (b) is printed in type of a size smaller than that known as ten point Times, or (c) contains a material mis-statement or inaccuracy, unless in the case of a material mis-statement or inaccuracy, the court before which the enforceability of any instalment contract comes in question, or before which proceedings for an offence under this Act are heard, is satisfied that such failure was accidental or due to inadvertence and was not of such a nature as to be liable to mislead or deceive any person to the person's prejudice or disadvantage, and that the purchaser was not in fact so misled or deceived. (4) Any failure to comply with the provisions of this section by any agent of a vendor shall be deemed to be also a failure by the vendor to comply with such provisions, unless such vendor proves that having taken all reasonable precautions against such failure the vendor had reasonable grounds to believe and did believe that all the requirements of this section had been complied with. 13 Instalment contract to contain implied term for assurance of lot to purchaser (1) Notwithstanding any stipulation therein, an instalment contract shall be deemed to contain a stipulation entitling the purchaser by notice in writing served on the vendor to require the vendor to do all such things and to execute all such instruments as may be necessary effectively to assure to the purchaser the lot comprised in the instalment contract for the interest therein specified if at the time of the execution of such instruments the purchaser— (a) shall have paid not less than fifteen per centum of the purchase money, or (b) shall have received a notice referred to in section 14 (1) and shall, within a period of twenty-eight days after receiving such notice, have served on the vendor a notice in writing informing the vendor that the purchaser proposes to exercise the purchaser's rights conferred by the stipulation implied by this section, and shall, at the time of the execution by the vendor of such instruments, have executed a mortgage back to the vendor or to such mortgagee as the vendor may have directed which shall— (i) secure payment of the purchase money owing under the instalment contract at the date of the mortgage by instalments of the same amounts and payable at the same time as the remaining instalments payable under the instalment contract, (ii) be in the form, or one of the forms, of mortgage annexed to the trust deed relating to the subdivision in which the lot is included, and (iii) be prepared and completed by or on behalf of the mortgagee at the expense of the mortgagor, which expense shall not in any case exceed the amount prescribed by any General Order made under section 206 of the Conveyancing Act 1919 for the time being in force. (2) Nothing in subsection (1) prevents any mortgage referred to in that subsection from— (a) containing provisions for securing the payment of the purchase money owing under the instalment contract at the date of the mortgage different from those referred to in subsection (1) (i), or (b) being in a form different from the form, or one of the forms, of mortgage annexed to the trust deed, where the vendor and purchaser have so agreed. (3) The rights conferred on a purchaser by subsection (1) shall be subject to section 14 (3). 14 Notice of intention to charge land to be given to purchaser and trustee (1) Before charging a lot the subject of an instalment contract with any form of security (other than statutory charges) which could enable the interest of the purchaser to be overreached by a creditor directly or indirectly, the vendor shall give to the purchaser, or the assignee of the purchaser, and to the trustee under the trust deed relating to the subdivision in which such lot is included notice in a form approved by the Registrar-General of the vendor's intention so to charge the lot. (2) (a) Where a vendor under an instalment contract gives to the purchaser a notice referred to in subsection (1), the vendor shall not within a period of twenty-eight days after giving the notice charge the lot comprised in the instalment contract as is mentioned in subsection (1). (b) Where a purchaser who has been given a notice referred to in subsection (1) has within twenty-eight days after such notice was given served on the vendor a notice informing the vendor that the purchaser proposes to exercise the purchaser's rights under the stipulation implied by section 13, the vendor shall not within a period of twenty-eight days after the service on the vendor of the notice so informing the vendor charge the lot comprised in the instalment contract. (3) Where a purchaser or the purchaser's assignee— (a) has been given a notice referred to in subsection (l), and (b) has not exercised the rights conferred on the purchaser by the stipulation implied by section 13, then during the currency of the security to which such notice relates given in respect of the lot the purchaser or assignee shall not be entitled to exercise such rights, but nothing in this subsection affects any other rights of the purchaser or assignee under the instalment contract. (4) In this section, vendor includes any assignee of a vendor and any person for the time being entitled to receive instalments under the instalment contract who has acquired in the lot the subject of the instalment contract an interest capable of being the subject of such a charge as is referred to in subsection (1). 15 Implied undertakings by vendor where plan of subdivision not registered Every instalment contract relating to a lot in a subdivision the plan of which has not been registered in the office of the Registrar-General shall be deemed to include undertakings by the vendor that— (a) where at the date of the instalment contract the plan has not been lodged for registration in the office of the Registrar-General, the vendor will lodge the plan for registration in such office within twenty-eight days after the making of the instalment contract, and (b) where at the date of the instalment contract or at any subsequent date the plan has been or is lodged for registration in such office, the vendor will do all things reasonably required of the vendor to procure prompt registration of such plan. 16 Implied undertakings in instalment contracts for sale of lots comprised in primary applications (1) An instalment contract for the sale of a lot comprised in a primary application shall be deemed to include undertakings by the vendor— (a) promptly to notify the purchaser and the trustee of all requirements made by the Registrar-General in respect of such application, (b) to supply from time to time as required by the purchaser information as to the progress of such application, and (c) promptly to attend to all matters reasonably necessary to procure the creation of a folio of the Register kept under the Real Property Act 1900. (2) In respect of any such primary application— (a) all requirements made by the Registrar-General shall be deemed to be requisitions which the purchaser is entitled to make on the vendor and has made within the time limited by the instalment contract for making requisitions, and (b) if the vendor fails to satisfy such requirements within a reasonable time after being notified thereof by the Registrar-General the purchaser shall be entitled to exercise all remedies (including the right to make time of the essence of the contract) conferred by law on purchasers against vendors unable or unwilling to comply with or remove any requisition or objection. (3) This section shall have effect notwithstanding any stipulation in the instalment contract. 17 Stipulations in instalment contracts depriving purchasers of certain remedies to be void—rights of purchasers to make early payments (1) Any stipulation in an instalment contract entered into before registration of a plan of the subdivision shall be void to the extent to which it could have the effect of depriving the purchaser of any remedy (including any right to make time of the essence of the contract) in the event of undue delay by the vendor in procuring registration of such plan. (2) Notwithstanding any stipulation in an instalment contract, a purchaser under the instalment contract may pay any instalment payable under the instalment contract although the time for payment has not arrived, and in any case where the instalment contract provides for the payment of interest on any instalment payable thereunder and that instalment is paid before the time for its payment has arrived, no interest shall be payable from the date of payment of the instalment. 18 Stipulations in instalment contracts avoiding trustees' liabilities to be void Any stipulation in an instalment contract shall be void to the extent that it would have the effect of exempting a trustee under a trust deed from, or indemnifying the trustee against, liability for breach of trust should the trustee fail properly to perform the powers, authorities, duties and functions required of the trustee as trustee having regard to the provisions of the trust deed. 19 Stipulations in instalment contracts for payment of trustees' expenses by purchaser to be void Any stipulation in an instalment contract shall be void to the extent that it would entitle the vendor to recover or obtain or seek to recover or obtain from the purchaser payment of the costs, charges and expenses of the trustee under a trust deed in performing the trustee's powers, authorities, duties and functions under this Part, or any part of those costs, charges and expenses. 20 Stipulations in instalment contracts for employment of specified solicitor etc by purchaser to be void Any stipulation in an instalment contract to the effect that the assurance to, or the registration of the title of, the purchaser shall be prepared or carried out at the expense of the purchaser by a solicitor or conveyancer appointed by or acting for the vendor, and any stipulation which might restrict a purchaser under an instalment contract in the selection of a solicitor or conveyancer to act on the purchaser's behalf in relation to any interest in a lot agreed to be purchased, shall be void. 21 Payments to trustees or agents deemed to be payments to vendor Notwithstanding any stipulation in an instalment contract, any money paid by or on behalf of a purchaser of a lot under the instalment contract to the trustee under the trust deed relating to the subdivision in which such lot is included or to the agent of the vendor, whether by way of preliminary or other deposit or otherwise, shall be deemed to have been paid to the vendor, but this section shall not affect any proceedings which may be taken against the trustee or other person. 22 Duties of vendors where lot is under Real Property Act 1900 Notwithstanding any stipulation in an instalment contract, where a transfer, duly stamped within the meaning of the Stamp Duties Act 1920 and executed pursuant to section 13, is held by or on behalf of the vendor under such contract, the vendor or the vendor's agent shall, if the purchaser has paid to the vendor or the vendor's agent, as the case may be, the fees referred to in paragraph (a)— (a) forthwith lodge such transfer with the proper officer at the office of the Registrar-General for registration, accompanied by the prescribed fees necessary to procure registration of such transfer, and (b) within seven days after so lodging such transfer, notify in writing the purchaser or the purchaser's solicitor that the vendor or the vendor's agent holds the receipt issued by the Registrar-General upon lodgment of the transfer and in such notification indicate a time and place for the purchaser or the purchaser's solicitor to inspect such receipt, and (c) promptly attend to all matters reasonably necessary to procure registration of such transfer, and (d) notify in writing the purchaser or the purchaser's solicitor when such transfer has been registered. 23 Duties of vendors where lot is not under Real Property Act 1900 Notwithstanding any stipulation in an instalment contract, where a conveyance, duly stamped within the meaning of the Stamp Duties Act 1920 and executed pursuant to section 13, is held by or on behalf of the vendor under such contract, the vendor or the vendor's agent shall, if the purchaser has paid to the vendor or the vendor's agent, as the case may be, the fees referred to in paragraph (a)— (a) forthwith produce such conveyance to the p