PENNY plans to purchase a vacant block of land.

The property is in the process of being subdivided from its parent property.

Development Approval has been granted by Council but NSW Land Registry Services has not yet registered the new lot.

Penny wishes to secure her purchase and wants to exchange contracts before registration.

The vendor provides Penny with a contract for the sale of the land and she makes an appointment to review the contract with her solicitor.

The contract contains a draft “plan” which has been prepared by a surveyor.

The plan sets-out the location and the dimensions of Penny’s block.

The contract states that Penny must accept minor variations to the plan, including changes in dimension of up to five percent.

The plan identifies easements which will burden the property and draft “88B instruments” detailing the nature of these easements.

The contract states that Penny must accept additional easements if they are required by Council.

The contract contains a “sunset clause” which states that if the plan is not registered within six months, Penny can rescind the contract and her deposit can be returned to her.

Settlement of Penny’s purchase is triggered upon registration of the plan and the contract states that this will be scheduled for 21 days after registration.

If a separate council rates notice has not been registered before settlement, the contract states that the parties agree to contribute towards the rates on the basis that the Council assesses rates at an estimated $3,000 per annum.

Penny is advised that because settlement may not occur for several months, her current loan approval may expire before settlement and she will need to be confident that further loan approval will be granted if need be.

Penny pays her deposit and contracts are exchanged.

Settlement occurs via an electronic platform known as PEXA, three months later.

Email Manny Wood, Principal Solicitor and Accredited Specialist in Wills and Estates at TB Law at manny@tblaw.net.au or call him on (02) 66 487 487.

This column is only accurate at today’s date and is not legal advice.

By Manny WOOD, Solicitor