In Victoria, the seller must give the buyer a signed vendor statement before the buyer signs the contract. It is known as the Section 32 statement.
It sets out title and land matters such as mortgages, easements, covenants, zoning and rates.
It does not tell you the condition of the building. Read it with your solicitor before you sign.
Where the Section 32 comes from
The statement is required by section 32 of the Sale of Land Act 1962 (Vic).
It is usually prepared by the seller's lawyer or conveyancer, signed by the seller and attached to the contract.
The seller may sign electronically.
The seller's duty to give the statement cannot be removed by a term of the contract.
What it covers
The statement covers matters that affect the land, including:
- Mortgages over the land.
- Easements, covenants and other restrictions on the title.
- Zoning and planning controls.
- Outgoings such as council rates.
- Whether the land is in a bushfire-prone area.
- For a unit, an owners corporation certificate and related documents.
Extra statements are needed if there is a mortgage that will not be paid out at settlement, or if the sale is on terms.
What it does not cover
The Section 32 does not cover:
- The condition of the buildings.
- Whether the buildings comply with building rules.
- Whether the measurements on the title are accurate.
For these, you need your own inspections or reports, such as a building and pest report or a survey.
When it must be given
The statement must be given before the buyer signs the contract.
The agent usually makes it available before the sale or the auction.
A statement can be prepared up to 12 months before the sale. For a unit, ask for a new owners corporation certificate before settlement, or inspect the owners corporation register.
There is one exception. A statement is not needed where the same parties already contracted to sell the same property on substantially the same terms and a statement was given for that sale.
If the statement is wrong or missing
The statement must be accurate and complete.
If it is not given, or is incorrect or incomplete, the buyer may be able to withdraw from the sale or take legal action against the seller.
The time limits and conditions for withdrawing are set by the Sale of Land Act. Call us as soon as you find a problem, before settlement and before you take any step.
The due diligence checklist
Victorian sellers and agents must also make the Consumer Affairs Victoria due diligence checklist available to buyers, for example at open inspections and on the agent's website.
It raises matters such as flooding and bushfire risk, owners corporation rules, planning controls, contamination, boundaries and building permits.
It is a separate document from the Section 32. Use both.
Where people get caught
Treating the Section 32 as a building report
It does not cover the condition of the buildings or whether they comply with building rules.
Relying on an old owners corporation certificate
The statement can be up to 12 months old. Ask for a new certificate before settlement.
Not checking the measurements
The title measurements are not confirmed by the Section 32. Compare them with the fences and buildings.
Signing first and reading later
The statement is given before you sign so you can read it before you sign. Have it checked first.
Common questions
Who prepares the Section 32?
Usually the seller's lawyer or conveyancer. The seller signs it.
Does the Section 32 tell me if the house has defects?
No. It covers title and land matters, not the condition of the buildings.
What if the Section 32 is wrong?
You may be able to withdraw from the sale or take legal action. Call us before you take any step.
Buying in Victoria? Send us the Section 32 and contract before you sign. Call (02) 8062 6300.
This article is general information only. It is not legal advice for your situation.