What lies beneath

Property Law: 23 March 2019

Sometimes lawyers are asked to step in at the last moment to help purchasers who have not sought proper legal advice before committing to the biggest purchase of their lives.

One instance that comes to mind was the purchase of a property down the Peninsula. The Vendor's Statement included a Title Plan. However no-one explained to the Purchasers the significance of the note 'E-1' on the Title Plan. E-1 was in fact a sewerage easement 10 feet wide that ran down one side of the property - over which the carport has been built.

When it was explained to the Purchasers, after they had signed, that E-1 could prevent them from walling up the carport and turning it to a living room, they sought legal advice.

It was soon discovered that a main sewer was laid in the easement and the authority had not consented to the carport. There was no chance of obtaining consent to turn the carport into a living room and the purchasers were advised that if ever it became necessary to access the sewer, they might be liable for any extra excavation costs because of the carport and might even be required to pull it down.

The failure to obtain consent was not disclosed in the Vendor's Statement so the Purchasers had an opportunity to cancel the Contract and get their deposit back.  Armed with the threat of terminating the Contract, a reduction of the purchase price was negotiated and they proceeded with their purchase.