Canberra off the plan buyers get contract rescission protections

New protections will come for off the plan buyers in the ACT after new laws passed in the Legislative Assembly. The Civil Law (Sale of Residential Property) Amendment Bill 2021 was legislated after complaints about off-the-plan contracts being unfairly rescinded. Under the new legislation, developers will be able to rescind a contract only if the buyer consents or if there has been an order of the ACT Supreme Court. The developer must give 28 days written notice to the buyer and must disclose why the contract should be revoked. If the buyer does not agree, the developer may seek an order from the Supreme Court sanctioning the recission. The court will take into account the impact that the revoked contract has on both the buyer and seller. “The recent trend of developers rescinding contracts has led to great personal distress for some buyers, as well as undermining confidence in the off-the-plan property purchase market,” said ACT Attorney-General Shane Rattenbury. He noted there had been "inappropriate opportunistic conduct” which had prompted protections for homebuyers from sunset and development delay clauses "in illegitimate and unjustifiable circumstances." “The housing market is already stressful for buyers, and it is often first-home buyers who are looking at off-the-plan purchases. It was important to act swiftly to address these concerns and protect consumers from rescissions occurring in bad faith.” “Developers will still be able to include sunset and development delay clauses in off-the-plan contracts, but they will only be able to use these clauses to rescind a contract if the buyer consents or if they’re permitted by an order of the ACT Supreme Court,” he said. There are similar rules in other states.