Vacant possession at settlement

What is vacant possession ? Can a tenant have vacant possession? Can I get a vacant possession on my? It is often an issue when a buyer intends to use the property as a home.

The standard REIQ Contract terms provide that if the Tenancies section of the Contract is not completed and the tenancy is not noted in the Contract then the Seller must provide the Buyer with vacant possession of the property at settlement.

In a straightforward case, vacant possession means the absence of people or chattels. However, there are several examples where an outstanding legal claim has caused a breach of vacant possession – and there have been some very obscure ones over the years. Impediments to vacant possession are not confined to tenants or owners remaining on the property after the settlement date. The obligation to give physical vacant possession to the purchaser requires the vendor to remove from the property any goods not included in the sale, unless the purchaser has consented to them being left on the property. When buying or selling a property, ‘vacant possession’ means that the property is empty on the day of completion.

Therefore the sellers or tenants have moved out and removed all of their belongings, only leaving behind items that have been agreed with the buyer. The Contract is either marked “vacant possession” or “subject to existing tenancy”. If no box is marke there is a presumption that you will obtain vacant possession on settlement.

However, you will not be able to rely on this presumption if it can be shown that you had actual knowledge, prior to entering into the contract that the property was being sold subject to an existing tenancy or occupancy. Vacant Possession and Conveyancing. Many clients ask us what are their legal rights when the seller has still left rubbish or personal items in the property on the day of settlement.

Refusing to settle and complete the Contract is one option and is a valid one provided that the purchaser can show that the seller has failed to provide vacant possession. A pre- settlement inspection is always a good idea. Sometimes the vendor moves out on settlement day – you might have to arrange the timing of the settlement to suit. Generally speaking, an obligation to give vacant possession requires a seller to remove any goods (chattels) not included in the sale of property before settlement , including “rubbish” extraneous to the sale (unless the buyer has consented to such items being abandoned or left on the land permanently). There’s a fair bet, if you have anything to do with commercial property, that you’ll have heard the term ‘vacant possession’.

Usually, you’ll see this on the contract for the sale of commercial property, specifying that the property should be sold “with vacant possession” or subject to a specific lease. For example, if there are old cars on the property and it is not possible to remove them before settlement date, some money can be held back from the settlement. In a contract for sale of lan the seller is required to deliver up vacant possession of the property to the buyer at settlement , unless the property is already subject to an existing tenancy. When purchasing a property, vacant possession is one of the requirements that many people look for, especially when their intention is to live in the property.

Pre-Settlement Inspection Checklist. One of the most common issues that arise for purchasers is the presence of rubbish and personal items, left on the property after settlement. The vendor is required to give the purchaser vacant possession before settlement (unless the property is being sold tenanted).

A vacant possession clause in a sale agreement gives a buyer a solid legal foundation on which to base some sort of remedial action if things go wrong.

More than that, it should prevent the problem happening in the first place by focussing the seller’s mind on the things they must sort out before completion. The most common interest in possession in settled property is a life interest, but the interest may be for a longer or shorter period. It may be for a fixed period or until some power is exercised.

The purchaser or tenant must be free to enjoy the property for the purpose intende without hindrance from any physical presence or legal impediment. This would entitle the purchasers to sue for liquidated ascertained damages (LAD) for late delivery of vacant possession by months! As a result, housing developers may want to offer a full and final settlement to house buyers.

Yes, you are simply confirming the place is still as you inspected it when you made the offer. Its not the time when you pick, choose, nit pick, or negotiate about apparent faults. If vacant possession is a condition, that you will get that at settlement. The buyer indemnifies the seller against any damages or expenses incurred by the seller as a result of the buyer’s possession before settlement.

Downfalls of Early Possession for the Seller. If the Seller can not provide the buyer with vacant possession upon settlement then the Buyer may: erminate this Contract by giving the Seller notice in accordance with the terms of the contract. The purchaser is also entitled to serve what is known as a “Settlement Notice” on the vendor if vacant settlement is unable to be completed due to vacant possession not being available and this Settlement Notice typically gives the vendor working days to provide vacant possession so settlement can be completed.