Different requirements for releasing a deposit when selling a Unit Title property

A couple were selling a unit titled property and were keen to have the deposit released to them as soon as possible. 

The agent sent a request for early release of the deposit to the lawyers for both parties.  The couple’s lawyer advised that they had not yet received a Pre-Settlement Disclosure Statement (PSDS) from the Body Corporate, so the deposit could not be released.

Releasing a deposit

When an agent holds a deposit as part payment of the purchase price for a property, the agent must hold any deposit paid to them for ten working days after the date that they received it, before paying the deposit to the vendor.

The Agreement for Sale and Purchase provides that the agent (or the stakeholder) shall hold the deposit:

• Until the agreement is unconditional (i.e. all conditions are met), and the title requisition clause procedure has been completed (whichever is the later), or the purchaser waives their rights; and
• When the deposit is paid towards the sale and purchase of a unit title property, the deposit cannot be released until the Pre-Settlement Disclosure Statement, and any Additional Disclosure Statement, have been provided to the purchaser. 

The reason for having this requirement is that a purchaser can cancel an Agreement for Sale and Purchase if the PSDS is not provided. 

The parties can agree to an early release of the deposit, but in the case of unit titles, this is less likely to be agreed for the above reason.

There are a number of different requirements when selling a unit titled property, so it pays to take advice from a professional experienced in the area if you are unsure.

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.