An SA buyer has paid a $5,000 deposit and serves a cooling-off notice the next day. What happens?
Correct Answer
A) The contract is rescinded, and the vendor may keep a deposit only up to $100
Under s 5(4) of the Land and Business (Sale and Conveyancing) Act 1994 (SA), when a purchaser rescinds by written notice within the cooling-off period, the purchaser is entitled to the return of money paid, except that the vendor may keep a deposit not exceeding $100 (or a greater amount fixed by regulation) and any amount paid for an option.
Why This Is the Correct Answer
Under s 5(4) of the Land and Business (Sale and Conveyancing) Act 1994 (SA), rescinding within the cooling-off period ends the contract. The purchaser gets their money back, except that the vendor may keep a deposit of up to $100, or a greater prescribed amount.
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