If you intend buying or selling residential waterfront property on the Gold Coast, take note of Local Law No.17 (Maintenance of Works in Waterway Areas) 2013 (“Local Law 17”) which came in to effect on 11 June 2013.
The Purpose of Local Law No. 17
The primary purpose of the local law is to impose obligations on property owners of land abutting a waterway area, to maintain any prescribed work – being completely or partly in on above or below a waterway area and includes (but not limited to) tidal works, works designed to be exposed to exposed to water of a waterway area (i.e. jetty or pontoon) or a revetment wall. A waterway area is defined as including (but not limited to) all land and waters in the local government area in a tidal, non-tidal or artificial waterway, a lake or costal wetland.
The Seller’s Obligations
In accordance with section 15(2) of Local Law 17, a Seller under a relevant lot must ensure that when the Buyer becomes bound by the contract, the contract includes a clause stating or specifying the following matters:
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the contract is a contact to which section 15 of Local Law No.17 applies;
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the actual specified prescribed work that is completely or partly situated on or which is connected to the relevant lot;
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the reasonable person for the specified prescribed work that is required to maintain and keep specified prescribed work in a safe condition and good working order, repair and condition; and
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whether or not there is an outstanding notice issued by the local government under this local law in relation to the actual specified work and if so the contents of that notice.
The Buyer’s Rights
Under section 15(3) of Local Law 17, a Buyer may have rights to terminate the contract (if the property transaction has not settled) by notice to the Seller if:
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the Seller has not complied with the requirements of section 15(2); or
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there is an outstanding notice issued by the local government under the local law in relation to the actual specified work and that fact or contents of the notice have not been specified in the clause in the contract.
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If a contract is terminated validly on the above grounds, the Seller must repay to the Buyer any amount paid to the Seller or its agents towards the purchase of the relevant lot within (14) days of termination. There may also be financial penalties imposed on the Seller.
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It is worth noting that the Queensland Law Society has raised concern about the contract termination right under Local Law 17 given section 57A of the Property Law Act 1974 (Qld).
As there will be no requirement to record the applicability of Local Law No. 17 on the title of affected properties, we recommend that Sellers make all necessary enquiries to determine if the property is defined as a relevant lot to which the new disclosure requirements apply. Buyers should in turn make enquiries with the local authority to determine if they will inherit obligations to maintain prescribed works upon settlement in accordance with Local Law No. 17.
If you require any specific advice on the effect of Local Law 17 or your obligations please do not hesitate to call Marino Law.
This article should not be considered as either formal or informal legal advice. This article should only be read as general information relating to the particular subject matter it is written about. The information may or may not apply to the reader’s particular circumstances. Marino Law only purports to provide legal advice to clients who have provided detailed instructions and who have formally retained our services.
