The ADLS/REINZ Agreement for Sale and Purchase of Real Estate, 11th Edition 2022 has officially been released on 8 February 2022. We highlight some of the changes of this latest edition...
Warning and disclaimer
The warning and disclaimer schedule has been amended and now provides for more generic warnings. The authors felt that a number of the warnings were not being heeded and had become redundant. They also believed that with the always changing risk environment other warnings would need to be added. Instead of having an ever-growing list, they decided to remove several of the warnings in favour of more generic warnings. There is now more care required of representatives to advise their clients as may be necessary.
Property price allocation (“PPA”)
This is largely dealt with by way of an addendum with the view taken that the applicable rules of PPA would not apply to most matters. However, transactions of land may have important tax implications and the addendum is be used when it is applicable. It would be advisable to have your clients seek specialist tax advice should the PPA rules apply.
The addendum provides that it would not need to be used when:
Definition of lawyer
A party’s lawyer now includes reference to a conveyancing practitioner.
The process of tendering settlement in clause 3.10 has changed and abandons the use of cheques.
Claims for compensation
Clause 10 provides for claims for compensation by the purchaser. The latest version makes various changes with the intention to improve its operation.
Clause 16 is updated to be more in line with the Trust Act 2019. It includes a limitation of liability for a trustee who is not a beneficiary of the trust who is defined as an independent trustee. Such trustee’s liability is limited to the indemnity available from the trust’s assets. However, if the indemnity is lost, the trustee can be personally liable.
A person signing on behalf of either the vendor or purchaser who does not select what capacity such person is acting in, is no longer personally bound by such omission. The agreement now provides that a person acting on behalf of a party to the agreement acknowledges that they have authority to sign on behalf of one of the parties.
With the continued need to cater for circumstances that may arise due to Covid-19, it was decided that the agreement be amended to include a permanent clause in the latest version.
The clause caters for restriction on personal movement affecting the general population of an area or district. The clause provides that condition dates are postponed and a settlement date delayed, if the applicable circumstances apply.
If the applicable circumstances did arise, a condition date may be postponed to 10 working days after the restriction has been removed or the date of satisfaction of the condition, whichever is the later. The settlement date may be postponed to 10 working days after all conditions are satisfied or waived, or 10 working days after the restriction has been removed or the date of satisfaction, whichever is the later.
The agreement in its amended form does not regulate delays which may impact on parties as a result of self-isolation requirements, particularly in relation to the vendor. Please contact our offices for clauses catering for such scenarios when acting for a vendor.
The parties signing the agreement acknowledge that they have been given a copy of the agency’s in-house complaints and dispute resolution process. Therefore, now in addition to the guide about the sale of residential property approved by the Real Estate Authority, an agent must remember to provide their in-house complaints and resolution process to the parties prior to the parties signing.
The National public holiday in recognition of Matariki has not been included as an exclusion to the definition of working day. This was decided because the Holidays Act 2003 has not yet been updated to reflect the day as a National public holiday.
Auction and tender forms
The relevant applicable changes have been carried across to the auction and tender versions. Cheques are no longer to be submitted for payment of deposits. Deposits are now payable electronically, immediately upon acceptance of tender.
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The information posted on this website is prepared for a general audience, without investigation into the facts of any particular case. This information is no substitute for legal advice and does not create a lawyer-client relationship; you are advised to consult with a lawyer on any legal issue.