In an SA property transaction, what is the legal effect of exchanging contracts?
Correct Answer
D) It creates a binding contract, subject to any conditions and the buyer's cooling-off right
Exchange of contracts creates a legally binding agreement between the vendor and purchaser, subject to any conditions precedent (such as finance or building inspection) and the purchaser's cooling-off rights.
Why This Is the Correct Answer
Why the Other Options Are Wrong
Deep Analysis of This Contracts Conveyancing Question
Background Knowledge for Contracts Conveyancing
Real World Application in Contracts Conveyancing
Common Mistakes to Avoid on Contracts Conveyancing Questions
Related Topics & Key Terms
Key Terms:
More Contracts Conveyancing Questions
Contracts for an established Wollongong home are exchanged by private treaty at 11 am on a Wednesday. There are no public holidays in the next fortnight and the buyer has not waived cooling-off. When does the buyer's cooling-off period end?
Under NSW conveyancing law, which situation means a residential purchaser has no cooling-off period?
Under what circumstances can a buyer waive their cooling-off rights in NSW?
What happens to the deposit when a purchaser exercises their cooling-off rights in NSW?
A property contract in NSW contains a clause requiring the purchaser to obtain finance approval within 21 days, failing which the contract becomes null and void. The purchaser's bank approves the loan on day 22, but the purchaser wants to proceed. What is the legal position?
- → A property developer selling land in NSW fails to disclose a significant planning restriction affecting it. The purchaser discovers this after settlement. If the restriction materially affects the land's value and use, what is the most likely outcome?
- → A NSW selling agent arranges the exchange of contracts between buyer and vendor at the agency office. After exchange, what must the agent do with the signed contract?
- → A house is passed in at a Saturday auction in NSW. Negotiations with the highest bidder continue, and contracts are exchanged on the following Monday without any cooling-off waiver. Does the buyer have a cooling-off period?
- → A NSW agent signs up a vendor on Monday. The vendor's conveyancer says the draft contract will not be ready until Friday. The agent wants to put a 'For Sale' sign on the front fence on Tuesday. Is this allowed?
- → After exchange on a Newcastle house, the buyer's solicitor finds that the council planning certificate required by section 52A of the Conveyancing Act 1919 was not attached to the contract. What right does the buyer have?
- → A freestanding NSW house with a swimming pool is about to be listed. The pool is registered, but an inspector found the barrier non-compliant. Which document can be attached to the contract to meet the pool requirement?
- → A vendor's proposed contract names her solicitor as acting on the sale. A keen buyer arrives with a signed contract and a deposit, and the agent wants to exchange on the spot. The solicitor cannot be reached. What is the position?
- → A contract of sale in Queensland contains a clause stating 'time is of the essence' regarding the settlement date. The purchaser is ready to settle but the vendor cannot provide vacant possession until three days after the contractual settlement date due to tenant issues. What is the most likely legal consequence?
- → A Queensland residential property contract contains a building and pest inspection condition. The inspection report reveals significant termite damage. Under the standard REIQ contract, the buyer may:
- → In Queensland, which of the following property sales is NOT subject to a cooling-off period?
People Also Study
Property Law & Legislation
110 questions
Agency Practice & Law
138 questions
Property Marketing & Sales
129 questions
Property Management
126 questions