Frequently Asked Questions About Your Right To Cool Off
Can you break the contract after the cooling off period has expired? Yes, under some circumstances you can end the contract. If there are conditions in the contract which allow you to end the contract should an event occur or not occur (conditions precedent/conditions subsequent) you can rightfully act on these; an example of such condition is the subject to finance clause. The subject to finance clause gives you the right to end the contract should your finance not be approved within a specific time frame.
Vendor’s breaches or home no longer fit for occupation (destroyed home) Other situations which allow you to end (rescind) the contract include: breaches by the vendor/vendor’s representative of the Sale of Land Act or any other relevant legislation; OR where the house is destroyed or damaged prior to settlement and no longer fit for occupation as a house-dwelling.
Where the vendor fails to accept your written offer within time When buyers make their written offer and there is an expiry date on which the vendor can accept that offer, effectively there is no contract in place, and you can avoid the contract without relying on the cooling off provisions.
There may be other methods available to you to validly end the contract. Please contact our us for further information.
You can change your written offer after signing the contract provided that the vendor has not agreed to your offer. Arguably, the vendor need not have signed the contract in order for the contract to be binding.
The cooling off period ends three (3) business days after you sign the contract. If you signed on Monday, then the period expires on close of business Thursday.
Provided that you end the contract correctly under the cooling off laws, you will be entitled to your deposit less $100.00 or 0.2% of the purchase price whichever is greater. If the cooling off period has expired and you wish to end the contract, significant cost will be incurred. The deposit paid will be forfeited and the Vendor can sue you for further moneys. Please contact us should you require tailored advice.
By law, when you make a written offer and prior to the vendor accepting that offer, the agent must provide you with a copy of the contract you had signed. Intuitively this is so you can have the contract and section 32 vendors’ statement reviewed by your lawyer. If you were not provided with a copy of the contract you had signed when you made the written offer then there may be rights available to you.
Section 31 of the Sale of Land Act provides that the notice ending the contract under the cooling off laws must be delivered to the vendor and/or its agent at the address for service (shown on the contract) and this notice must be signed.
No, the rights granted under the Act do not protect the vendor. This does not preclude a vendor from having special conditions drafted in the contract granting them such right.
Yes and no. Your right to cool off is completely dependent on whether the signed contract contains specific conditions granting you such right. There is no law that protects a business purchaser.
No. Weekends and public holidays are excluded.
No. If the property is purchased at auction or within three business days before or after an auction there are no cooling off rights.
Not all purchasers are granted the right to cool-off. The exceptions are contained at section 31 of the Sale of Land Act 1962 which include:
Purchases before, after or at auction (cooling off at auctions)
You have entered into a contract with the vendor on substantially the same terms
Property is used primarily for industrial or commercial purposes
Property is more than 20 hectares and is used for farming purposes
You are a real estate agent