This Act regulates sales of lots by instalment contracts in subdivisions (five or more lots). It requires minister‑approved trust deeds and trustees to hold preliminary deposits and up to at least 15% of purchase money, prescribes standard contract forms and mandatory notices, limits certain contractual terms, and creates offences and penalties (s2, s7, s9–s13, s24). The Minister and Registrar‑General have key discretionary powers (approval, revocation, exemptions) that shift compliance costs onto vendors, trustees and agents.
This Act creates a statutory framework that regulates the sale of lots in subdivisions by instalment contracts, establishes mandatory trustee protection for purchasers’ monies, prescribes documentary and timing requirements before and after accepting deposits or tendering contracts, and implies particular contractual rights and undertakings into instalment contracts. The operative mechanical features are:
Scope: it governs instalment contracts for lots in subdivisions of five or more lots where purchase money is payable by four or more part payments (definition of "instalment contract", s 2). It excludes certain sales (s 2) and subdivisional forms such as strata schemes (s 2, relating to the Strata Schemes Development Act 2015).
Trustee regime: a trust deed complying with Pt 3 must be in place and a trustee approved by the Minister must hold specified purchaser moneys and perform defined functions, including retaining deposits until conditions are met (s 4(c), s 7(d), s 7(f)(ii)-(iv)).
Mandatory forms and notices: vendors and agents must give prescribed notices before accepting initial payments and before tendering contracts (s 12(1)-(2)), receipts for certain preliminary deposits must be endorsed "sale by instalment contract" (s 9(1)), and particular form mortgages and contracts annexed to the trust deed must be used (s 7(c), s 10(1)).
Protected purchaser remedies and implied rights: purchasers gain an implied right to require transfer of title on payment of at least 15 per cent of the purchase price, subject to executing a mortgage back to the vendor (s 13(1)), and vendors have statutory undertakings when plans are unregistered or primary applications are involved (ss 15, 16).
Restrictions on vendor behaviour: vendors are prevented from accepting instalment payments directly until the trustee confirms 15 per cent of the price has been paid (s 11), vendors are restricted from charging lots without a prescribed Registrar-General notice and delay (s 14), and certain contractual stipulations are void (ss 17-20).
Current sections
Direct links to the current provisions in Land Sales Act 1964.
(2) This Act shall commence upon a day to be appointed by the Governor and notified by proclamation published in the Gazette.
s 1: Am 1978 No 2, Sch 1 (3).
1A
1A
1A (Repealed)
Part 2
Part 2
Part 2
1B–1E (Repealed)
pt 2: Ins 1978 No 2, Sch 1 (4). Rep 1987 No 195, sec 3.
s 1B: Ins 1978 No 2, Sch 1 (4). Subst 1980 No 152, Sch 1 (1). Rep 1987 No 195, sec 3.
s 1C: Ins 1978 No 2, Sch 1 (4). Am 1980 No 152, Sch 1 (2). Rep 1987 No 195, sec 3.
s 1D: Ins 1978 No 2, Sch 1 (4). Subst 1980 No 152, Sch 1 (3). Rep 1987 No 195, sec 3.
s 1E: Ins 1978 No 2, Sch 1 (4). Am 1980 No 152, Sch 1 (4). Rep 1987 No 195, sec 3.
Part 3
Sale of land under instalment contracts
Part 3 Sale of land under instalment contracts
Part 3 Sale of land under instalment contracts
pt 3, hdg: Ins 1978 No 2, Sch 1 (5).
2
Definitions
2 Definitions
2 Definitions
In this Part, unless the context or subject matter otherwise indicates or requires—
Instalment contract means a contract, entered into after the commencement of this Part, for the sale of a lot in a subdivision comprising five or more lots where such contract provides for the purchase money to be paid by four or more part payments (whether by way of preliminary or other deposit or otherwise) and any option to purchase such a lot under which all or part of the consideration for the granting of such option (whether or not such consideration is to be applied to the purchase price) is payable by four or more part payments as aforesaid, but does not include—
(a) a contract effecting a sale without resubdivision by a vendor who acquired less than five lots in a subdivision, or
Preliminary deposit means an initial payment (not being a payment, or part payment, for an option, other than an option referred to in the definition of instalment contract in this section) by a person in connection with the proposed purchase of a lot in a subdivision made to a person, or the agent of a person, who has offered, or held himself or herself out as being willing, to sell, or has advertised for sale, such lot, where the payment is made before there is a contract between such persons for the sale and purchase of such land.
Primary application means an application to the Registrar-General to bring land under the provisions of the Real Property Act 1900.
Purchaser includes a person (not being a person acting in the capacity of an agent for a vendor) by whom or on whose behalf a preliminary deposit is paid to a vendor.
Sell includes offer to sell, hold oneself out as being willing to sell, and advertise for sale.
s 2: Am 1978 No 2, Sch 1 (6); 1986 No 220, Sch 1; 1992 No 55, Sch 2; 1996 No 139, Sch 2.19 [1] [2] (am 1997 No 55, Sch 2.18 [1] [2]); 1997 No 152, Sch 4.19 [1]; 2015 No 51, Sch 9.11.
3
Sales by instalment contracts of lots in subdivisions
3 Sales by instalment contracts of lots in subdivisions
3 Sales by instalment contracts of lots in subdivisions
No person shall sell under an instalment contract any lot unless the subdivision in which the lot is comprised complies with the provisions of this Part.
s 3: Am 1978 No 2, Sch 1 (7).
4
Requirements as to subdivisions
4 Requirements as to subdivisions
4 Requirements as to subdivisions
A subdivision complies with the provisions of this Part if, at the time of the sale—
(a)
(i) the land comprised in the subdivision is under the provisions of the Real Property Act 1900, or
(ii) (Repealed)
(iii) although the land comprised in the subdivision is not under the provisions of the Real Property Act 1900, a plan of such subdivision has, before the commencement of this Act, been registered in the office of the Registrar-General, and
(b) the boundaries of the various lots in the subdivision follow the boundaries shown in a plan of subdivision that is endorsed with a subdivision certificate within the meaning of section 109C of the Environmental Planning and Assessment Act 1979, and
(c) a trustee holds office under a trust deed that—
(i) relates to the subdivision,
(ii) complies with the provisions of this Part, and
(iii) has endorsed on it in writing the Minister’s approval of the trust deed and the trustee appointed thereby.
Any approval referred to in paragraph (c) may be given subject to such terms and conditions as the Minister thinks fit.
s 4: Am 1978 No 2, Sch 1 (6) (c) (8); 1997 No 152, Sch 4.19 [2]; 2021 No 10, Sch 3.16[1] [2].
5
Approval of trustee may be revoked
5 Approval of trustee may be revoked
5 Approval of trustee may be revoked
(1) The Minister—
(a) may by notice published in the Gazette revoke as on and from a day (not being earlier than the date of publication of the notice) to be specified in the notice the Minister’s approval under this Part of any trustee appointed under a trust deed, and
(b) shall in any such notice specify a date on or after which the Minister proposes to exercise the Minister’s powers under subsection (3) unless a new trustee, approved in writing by the Minister, has before that date been appointed to act in the place of the former trustee.
(2) Any such revocation shall take effect on and from the day specified in the notice and referred to in subsection (1) (a) and thereupon the trustee shall cease to hold office as such trustee for all purposes. The Minister shall as soon as practicable after publication of the notice cause a copy of the notice of revocation to be served on the trustee and the vendor by whom, or for whom and on whose behalf, the trustee was appointed.
(3) Where the Minister revokes the approval of any trustee as aforesaid and the vendor fails, before the date referred to in subsection (1) (b), to appoint a new trustee, approved in writing by the Minister, to act in the place of the former trustee the Minister may, by a trust deed executed by the Minister for and on behalf of the vendor (which trust deed the Minister is hereby authorised to execute) and that complies with the provisions of this Part, appoint, upon such terms and conditions as the Minister thinks fit, a new trustee to act in the place of the former trustee but only as regards the powers, authorities, duties and functions of the former trustee so far as they relate to sales of lots made before the appointment of the new trustee and to purchasers of such lots and the new trustee so appointed shall be deemed for the purposes of this Part to be the trustee under the trust deed in respect of sales of lots made before his or her appointment.
Any terms and conditions (including terms and conditions providing for the remuneration of the new trustee by the vendor or out of moneys held by the new trustee on behalf of the vendor) upon which the appointment of a new trustee may be made as aforesaid and that are expressed to be binding on the vendor and any covenants or provisions in the trust deed appointing the new trustee that are expressed to be made on behalf of, or to be binding on, the vendor shall be deemed to be terms and conditions binding on, covenants by and provisions binding on, the vendor.
(4) Nothing in this section prevents the vendor, where the Minister has appointed a new trustee in accordance with this section, from appointing a further trustee in accordance with the provisions of the trust deed under which the former trustee was appointed, to act as trustee under the trust deed in respect only of sales of lots made after his or her appointment.
s 5: Am 1978 No 2, Sch 1 (7) (9).
6
Exemptions
6 Exemptions
6 Exemptions
(1) The Minister may by order published in the Gazette declare that the requirements of section 4 (c) and such other provisions of this Part as may be specified in the order shall not apply to or in respect of any subdivision specified in the order and any such order shall have effect according to its tenor.
(2) An instalment contract for the sale of a lot in a subdivision of land under the provisions of the Real Property Act 1900, being a contract under which the vendor of the lot is—
(a) a statutory body representing the Crown, or
(b) a local council,
is exempt from the provisions of this Part.
s 6: Am 1978 No 2, Sch 1 (10); 1998 No 4, Sch 1 [1].
7
Trust deeds
7 Trust deeds
7 Trust deeds
(1) A trust deed complies with the provisions of this Part if it—
(a) makes provision for the appointment by the vendor for such period as the Minister may approve after the date of the certificate referred to in section 4 (b) of a person as trustee for purchasers of lots in the subdivision proposed to be sold,
(b)
(i) provides for the appointment by the vendor of a new trustee approved by the Minister to act under the trust deed, where the former trustee ceases for any reason to hold office before his or her duties as trustee have been completed, and also provides that such appointment shall be made subject to such terms and conditions as the Minister may think fit and for such period as the Minister may approve, and
(ii) contains a covenant binding the trustee that the trustee will, upon ceasing to be a trustee, transfer to the trustee appointed by the vendor under subparagraph (i), or by the Minister under section 5, any money held by the trustee or on the trustee’s behalf, and any books of account kept by the trustee, in his or her capacity as such trustee,
(c) has annexed thereto a copy of the form or forms of instalment contract to be used in connection with the sale of the land comprised in the subdivision (which form or forms shall provide that all moneys payable thereunder by way of preliminary or other deposit or fifteen per centum of the purchase price (whichever is the greater) shall be paid by the purchaser to the trustee) and the form or forms of mortgage to be used for the purposes of section 13,
(d) contains a provision that all moneys received by the trustee from a purchaser under an instalment contract shall be retained by the trustee until the trustee has been authorised by the vendor to refund any such moneys, or—
(i) the trustee is satisfied that the purchaser has been given the notices prescribed in section 12, and
(ii) an instalment contract signed by both the vendor and the purchaser or their properly constituted attorneys has been presented to the trustee for inspection and the written authority of the purchaser to account to the vendor for such moneys has been furnished to the trustee,
(e) contains a covenant binding the vendor that the vendor will, upon demand made by the trustee or any registered public accountant appointed by the trustee, make available for inspection the whole of the books of the vendor relating to the subdivision to which the trust deed relates and give to the trustee or to any such registered public accountant such oral or written information as the trustee or registered public accountant requires with respect to the subdivision to which the trust deed relates where inspection of such books or such information is necessary for the proper and effective carrying out of the trustee’s powers, authorities, duties and functions under this Part and the trust deed,
(f) contains covenants binding the trustee that the trustee will—
(i) exercise all due diligence and vigilance in carrying out the trustee’s powers, authorities, duties and functions in watching the rights and interests of the purchasers of lots in the subdivision to which the trust deed relates,
(ii) punctually account for all moneys paid to the trustee in pursuance of this Part in accordance with the provisions of this Part and the trust deed,
(iii) keep or cause to be kept proper books of account with respect to all moneys paid to the trustee as aforesaid,
(iv) where the trustee has received fifteen per centum of the purchase price of any lot in a subdivision to which the trust deed relates, serve on the purchaser of such lot a notice in writing duly completed in or to the effect of the First Schedule, and on the vendor of such lot a notice in writing in or to the effect of the Second Schedule, and
(v) where the trustee has received a notice referred to in section 14 (1), serve on the purchaser a notice in writing duly completed in or to the effect of the Third Schedule,
(g) shall specify addresses for the service of any notice or document respectively on the vendor and trustee in their capacities as such.
(2) Any trustee or registered public accountant who except in the course of any court proceedings, divulges or communicates to any other person any information which the trustee or registered public accountant has acquired pursuant to subsection (1) (e) shall be guilty of an offence under this Act—
Provided that nothing in this subsection precludes a trustee from divulging or communicating any such information to the Minister, or any such information that relates to the sale of a particular lot to the purchaser of that lot or the purchaser’s solicitor or licensed conveyancer.
s 7: Am 1978 No 2, Sch 1 (11); 1992 No 55, Sch 2.
8
Certain advertisements prohibited
8 Certain advertisements prohibited
8 Certain advertisements prohibited
No person shall publish or cause to be published any advertisement referring to a subdivision and containing a statement that, or to the effect that, a trustee or trust deed has been approved by the Minister or referring in any way to this Act.
9
Receipts for certain preliminary deposits to indicate that sale is by instalment contract
9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract
9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract
(1) Where a vendor or the vendor’s agent accepts a preliminary deposit in connection with the sale of a lot in a subdivision and such preliminary deposit is paid pursuant to an agreement (whether oral or in writing or partly oral and partly in writing), implementation of which would necessitate the vendor and purchaser entering into an instalment contract, the vendor or the vendor’s agent accepting the preliminary deposit shall upon doing so give to the person paying the preliminary deposit a receipt on which are endorsed the words “sale by instalment contract”.
(2) Where a vendor or the vendor’s agent gives to a person paying a preliminary deposit a receipt on which are required to be endorsed the words “sale by instalment contract”, the vendor—
(a) shall within seven days after the preliminary deposit was paid pay the amount of the preliminary deposit to the trustee under the trust deed relating to such subdivision and either—
(i) tender to the purchaser for execution by the purchaser a copy of an instalment contract for the sale and purchase of the lot in connection with the sale of which the preliminary deposit was paid, such contract having annexed thereto or endorsed thereon an undertaking by the vendor that the vendor will refund to the purchaser an amount, not exceeding an amount stated in the undertaking, for the reasonable costs incurred by the purchaser as a client of a solicitor or conveyancer in procuring such advice relating to the proposed transaction and the provisions of this Part as the solicitor or conveyancer is obliged, upon an examination of the contract and the particulars of title given to the purchaser by the vendor, to furnish to the purchaser, as the client of the solicitor or conveyancer, or
(ii) authorise such trustee to refund to the purchaser the amount of the preliminary deposit and notify the purchaser in writing that the vendor is unwilling or unable to execute such an instalment contract, and
(b) where the vendor tenders to the purchaser a copy of the instalment contract in accordance with paragraph (a) (i), shall not, for the prescribed period, sell or cause to be sold the lot comprised in the instalment contract to any person other than the purchaser except where the purchaser and the vendor have agreed in writing that the vendor is not required to comply with the requirements of section 10 (2) and the vendor has authorised such trustee to refund to the purchaser the amount of any preliminary deposit paid by the purchaser.
In this paragraph the prescribed period means a period of fourteen days after the date on which the vendor tenders to the purchaser a copy of the instalment contract in accordance with paragraph (a) (i) and, where the provisions of section 10 (2) (a) and (b) have been complied with, a further period of seven days after the expiration of the said period of fourteen days.
(3) The amount for reasonable costs stated in the undertaking under subsection (2) (a) (i) may be varied by agreement in writing between the vendor and purchaser at any time before execution of the instalment contract by the purchaser.
s 9: Am 1978 No 2, Sch 1 (12); 1998 No 4, Sch 1 [2] [3].
10
Form of instalment contracts
10 Form of instalment contracts
10 Form of instalment contracts
(1) A vendor under an instalment contract, or the vendor’s agent, shall not tender to a purchaser a copy of an instalment contract for the sale and purchase of a lot unless the instalment contract is in the form, or one of the forms, of instalment contract annexed to the trust deed relating to the subdivision in which the lot is comprised.
(2) Within twenty-one days after tendering a copy of the instalment contract to a purchaser, the vendor shall deliver or cause to be delivered to the purchaser a counterpart of the contract duly executed by the vendor or the vendor’s duly appointed attorney, if—
(a) the copy of the instalment contract so tendered has been executed by the purchaser and has, within fourteen days after its having been so tendered, been delivered to the vendor or the agent of the vendor, and
(b) the purchaser has complied with all terms and conditions required by the instalment contract to be complied with by the purchaser at or before the delivery to the purchaser of the counterpart of the contract duly executed as aforesaid.
11
Vendor not to accept payment of instalments until 15 per cent of purchase price paid
11 Vendor not to accept payment of instalments until 15 per cent of purchase price paid
11 Vendor not to accept payment of instalments until 15 per cent of purchase price paid
No person, other than the trustee under the trust deed relating to the subdivision in which the lot is included, shall accept any payment, other than a preliminary deposit, made by or on behalf of a purchaser of a lot under an instalment contract unless the vendor has been given a notice in writing, duly completed, in or to the effect of the Second Schedule by such trustee that fifteen per centum of the purchase price payable under the instalment contract has been paid by or on behalf of the purchaser, but nothing in this section prevents any person from accepting any such payment from such trustee.
12
Notices to be given to purchasers
12 Notices to be given to purchasers
12 Notices to be given to purchasers
(1) No person shall receive an initial payment (whether by way of preliminary or other deposit or otherwise) in connection with an instalment contract unless, before receiving such payment, the person gives or causes to be given to the purchaser a notice in writing duly completed that is in or to the effect of the form in the Fourth Schedule and that complies with the requirements of this section and a notice in writing in the form in the Fifth Schedule and no person shall tender an instalment contract for execution by a purchaser unless at least twenty-four hours before so tendering such contract the person gives or causes to be given to the purchaser such notices.
(2)
(a) The notice in or to the effect of the form in the Fourth Schedule—
(i) shall be signed by the vendor or by the vendor’s duly appointed attorney and the signature shall be attested by a witness, or
(ii) where the vendor is a company, shall be under seal or shall be signed by an attorney of the company duly appointed under seal.
(b) Any such notice purporting to have been signed by an attorney shall be deemed to have been signed by the vendor or to be under the seal of the company as the case may be unless it is proved that such signatory was not authorised in that behalf.
(3) It shall be a failure to comply with the requirements of subsection (1) if any notice given to the purchaser in pursuance thereof—
(a) is in handwriting that is not clear and legible, or
(b) is printed in type of a size smaller than that known as ten point Times, or
(c) contains a material mis-statement or inaccuracy,
unless in the case of a material mis-statement or inaccuracy, the court before which the enforceability of any instalment contract comes in question, or before which proceedings for an offence under this Act are heard, is satisfied that such failure was accidental or due to inadvertence and was not of such a nature as to be liable to mislead or deceive any person to the person’s prejudice or disadvantage, and that the purchaser was not in fact so misled or deceived.
(4) Any failure to comply with the provisions of this section by any agent of a vendor shall be deemed to be also a failure by the vendor to comply with such provisions, unless such vendor proves that having taken all reasonable precautions against such failure the vendor had reasonable grounds to believe and did believe that all the requirements of this section had been complied with.
13
Instalment contract to contain implied term for assurance of lot to purchaser
13 Instalment contract to contain implied term for assurance of lot to purchaser
13 Instalment contract to contain implied term for assurance of lot to purchaser
(1) Notwithstanding any stipulation therein, an instalment contract shall be deemed to contain a stipulation entitling the purchaser by notice in writing served on the vendor to require the vendor to do all such things and to execute all such instruments as may be necessary effectively to assure to the purchaser the lot comprised in the instalment contract for the interest therein specified if at the time of the execution of such instruments the purchaser—
(a) shall have paid not less than fifteen per centum of the purchase money, or
(b) shall have received a notice referred to in section 14 (1) and shall, within a period of twenty-eight days after receiving such notice, have served on the vendor a notice in writing informing the vendor that the purchaser proposes to exercise the purchaser’s rights conferred by the stipulation implied by this section,
and shall, at the time of the execution by the vendor of such instruments, have executed a mortgage back to the vendor or to such mortgagee as the vendor may have directed which shall—
(i) secure payment of the purchase money owing under the instalment contract at the date of the mortgage by instalments of the same amounts and payable at the same time as the remaining instalments payable under the instalment contract,
(ii) be in the form, or one of the forms, of mortgage annexed to the trust deed relating to the subdivision in which the lot is included, and
(iii) be prepared and completed by or on behalf of the mortgagee at the expense of the mortgagor, which expense shall not in any case exceed the amount prescribed by any General Order made under section 206 of the Conveyancing Act 1919 for the time being in force.
(2) Nothing in subsection (1) prevents any mortgage referred to in that subsection from—
(a) containing provisions for securing the payment of the purchase money owing under the instalment contract at the date of the mortgage different from those referred to in subsection (1) (i), or
(b) being in a form different from the form, or one of the forms, of mortgage annexed to the trust deed,
where the vendor and purchaser have so agreed.
(3) The rights conferred on a purchaser by subsection (1) shall be subject to section 14 (3).
s 13: Am 1978 No 2, Sch 1 (6) (c) (13).
14
Notice of intention to charge land to be given to purchaser and trustee
14 Notice of intention to charge land to be given to purchaser and trustee
14 Notice of intention to charge land to be given to purchaser and trustee
(1) Before charging a lot the subject of an instalment contract with any form of security (other than statutory charges) which could enable the interest of the purchaser to be overreached by a creditor directly or indirectly, the vendor shall give to the purchaser, or the assignee of the purchaser, and to the trustee under the trust deed relating to the subdivision in which such lot is included notice in a form approved by the Registrar-General of the vendor’s intention so to charge the lot.
(2)
(a) Where a vendor under an instalment contract gives to the purchaser a notice referred to in subsection (1), the vendor shall not within a period of twenty-eight days after giving the notice charge the lot comprised in the instalment contract as is mentioned in subsection (1).
(b) Where a purchaser who has been given a notice referred to in subsection (1) has within twenty-eight days after such notice was given served on the vendor a notice informing the vendor that the purchaser proposes to exercise the purchaser’s rights under the stipulation implied by section 13, the vendor shall not within a period of twenty-eight days after the service on the vendor of the notice so informing the vendor charge the lot comprised in the instalment contract.
(3) Where a purchaser or the purchaser’s assignee—
(a) has been given a notice referred to in subsection (l), and
(b) has not exercised the rights conferred on the purchaser by the stipulation implied by section 13,
then during the currency of the security to which such notice relates given in respect of the lot the purchaser or assignee shall not be entitled to exercise such rights, but nothing in this subsection affects any other rights of the purchaser or assignee under the instalment contract.
(4) In this section, vendor includes any assignee of a vendor and any person for the time being entitled to receive instalments under the instalment contract who has acquired in the lot the subject of the instalment contract an interest capable of being the subject of such a charge as is referred to in subsection (1).
s 14: Am 1998 No 4, Sch 1 [4].
15
Implied undertakings by vendor where plan of subdivision not registered
15 Implied undertakings by vendor where plan of subdivision not registered
15 Implied undertakings by vendor where plan of subdivision not registered
Every instalment contract relating to a lot in a subdivision the plan of which has not been registered in the office of the Registrar-General shall be deemed to include undertakings by the vendor that—
(a) where at the date of the instalment contract the plan has not been lodged for registration in the office of the Registrar-General, the vendor will lodge the plan for registration in such office within twenty-eight days after the making of the instalment contract, and
(b) where at the date of the instalment contract or at any subsequent date the plan has been or is lodged for registration in such office, the vendor will do all things reasonably required of the vendor to procure prompt registration of such plan.
16
Implied undertakings in instalment contracts for sale of lots comprised in primary applications
16 Implied undertakings in instalment contracts for sale of lots comprised in primary applications
16 Implied undertakings in instalment contracts for sale of lots comprised in primary applications
(1) An instalment contract for the sale of a lot comprised in a primary application shall be deemed to include undertakings by the vendor—
(a) promptly to notify the purchaser and the trustee of all requirements made by the Registrar-General in respect of such application,
(b) to supply from time to time as required by the purchaser information as to the progress of such application, and
(c) promptly to attend to all matters reasonably necessary to procure the creation of a folio of the Register kept under the Real Property Act 1900.
(2) In respect of any such primary application—
(a) all requirements made by the Registrar-General shall be deemed to be requisitions which the purchaser is entitled to make on the vendor and has made within the time limited by the instalment contract for making requisitions, and
(b) if the vendor fails to satisfy such requirements within a reasonable time after being notified thereof by the Registrar-General the purchaser shall be entitled to exercise all remedies (including the right to make time of the essence of the contract) conferred by law on purchasers against vendors unable or unwilling to comply with or remove any requisition or objection.
(3) This section shall have effect notwithstanding any stipulation in the instalment contract.
s 16: Am 1979 No 164, Sch 22; 2021 No 10, Sch 3.16[3].
17
Stipulations in instalment contracts depriving purchasers of certain remedies to be void—rights of purchasers to make early payments
17 Stipulations in instalment contracts depriving purchasers of certain remedies to be void—rights of purchasers to make early payments
17 Stipulations in instalment contracts depriving purchasers of certain remedies to be void—rights of purchasers to make early payments
(1) Any stipulation in an instalment contract entered into before registration of a plan of the subdivision shall be void to the extent to which it could have the effect of depriving the purchaser of any remedy (including any right to make time of the essence of the contract) in the event of undue delay by the vendor in procuring registration of such plan.
(2) Notwithstanding any stipulation in an instalment contract, a purchaser under the instalment contract may pay any instalment payable under the instalment contract although the time for payment has not arrived, and in any case where the instalment contract provides for the payment of interest on any instalment payable thereunder and that instalment is paid before the time for its payment has arrived, no interest shall be payable from the date of payment of the instalment.
18
Stipulations in instalment contracts avoiding trustees’ liabilities to be void
18 Stipulations in instalment contracts avoiding trustees’ liabilities to be void
18 Stipulations in instalment contracts avoiding trustees’ liabilities to be void
Any stipulation in an instalment contract shall be void to the extent that it would have the effect of exempting a trustee under a trust deed from, or indemnifying the trustee against, liability for breach of trust should the trustee fail properly to perform the powers, authorities, duties and functions required of the trustee as trustee having regard to the provisions of the trust deed.
19
Stipulations in instalment contracts for payment of trustees’ expenses by purchaser to be void
19 Stipulations in instalment contracts for payment of trustees’ expenses by purchaser to be void
19 Stipulations in instalment contracts for payment of trustees’ expenses by purchaser to be void
Any stipulation in an instalment contract shall be void to the extent that it would entitle the vendor to recover or obtain or seek to recover or obtain from the purchaser payment of the costs, charges and expenses of the trustee under a trust deed in performing the trustee’s powers, authorities, duties and functions under this Part, or any part of those costs, charges and expenses.
s 19: Am 1978 No 2, Sch 1 (7).
20
Stipulations in instalment contracts for employment of specified solicitor etc by purchaser to be void
20 Stipulations in instalment contracts for employment of specified solicitor etc by purchaser to be void
20 Stipulations in instalment contracts for employment of specified solicitor etc by purchaser to be void
Any stipulation in an instalment contract to the effect that the assurance to, or the registration of the title of, the purchaser shall be prepared or carried out at the expense of the purchaser by a solicitor or conveyancer appointed by or acting for the vendor, and any stipulation which might restrict a purchaser under an instalment contract in the selection of a solicitor or conveyancer to act on the purchaser’s behalf in relation to any interest in a lot agreed to be purchased, shall be void.
21
Payments to trustees or agents deemed to be payments to vendor
21 Payments to trustees or agents deemed to be payments to vendor
21 Payments to trustees or agents deemed to be payments to vendor
Notwithstanding any stipulation in an instalment contract, any money paid by or on behalf of a purchaser of a lot under the instalment contract to the trustee under the trust deed relating to the subdivision in which such lot is included or to the agent of the vendor, whether by way of preliminary or other deposit or otherwise, shall be deemed to have been paid to the vendor, but this section shall not affect any proceedings which may be taken against the trustee or other person.
22
Duties of vendors where lot is under Real Property Act 1900
22 Duties of vendors where lot is under Real Property Act 1900
Notwithstanding any stipulation in an instalment contract, where a transfer, duly stamped within the meaning of the Stamp Duties Act 1920 and executed pursuant to section 13, is held by or on behalf of the vendor under such contract, the vendor or the vendor’s agent shall, if the purchaser has paid to the vendor or the vendor’s agent, as the case may be, the fees referred to in paragraph (a)—
(a) forthwith lodge such transfer with the proper officer at the office of the Registrar-General for registration, accompanied by the prescribed fees necessary to procure registration of such transfer, and
(b) within seven days after so lodging such transfer, notify in writing the purchaser or the purchaser’s solicitor that the vendor or the vendor’s agent holds the receipt issued by the Registrar-General upon lodgment of the transfer and in such notification indicate a time and place for the purchaser or the purchaser’s solicitor to inspect such receipt, and
(c) promptly attend to all matters reasonably necessary to procure registration of such transfer, and
(d) notify in writing the purchaser or the purchaser’s solicitor when such transfer has been registered.
s 22: Am 1978 No 2, Sch 1 (6) (c).
23
Duties of vendors where lot is not under Real Property Act 1900
23 Duties of vendors where lot is not under Real Property Act 1900
Notwithstanding any stipulation in an instalment contract, where a conveyance, duly stamped within the meaning of the Stamp Duties Act 1920 and executed pursuant to section 13, is held by or on behalf of the vendor under such contract, the vendor or the vendor’s agent shall, if the purchaser has paid to the vendor or the vendor’s agent, as the case may be, the fees referred to in paragraph (a)—
(a) forthwith produce such conveyance to the proper officer at the office of the Registrar-General for registration, accompanied by the prescribed fees necessary to procure registration of such conveyance, and
(b) within seven days after so producing such conveyance, notify in writing the purchaser or the purchaser’s solicitor that the vendor or the vendor’s agent holds the conveyance duly endorsed with the appropriate form of receipt given upon the registration of the conveyance and in such notice indicate a time and place for the purchaser or the purchaser’s solicitor to inspect such registered conveyance.
s 23: Am 1978 No 2, Sch 1 (6) (c).
Part 4
Miscellaneous
Part 4 Miscellaneous
Part 4 Miscellaneous
pt 4, hdg: Ins 1978 No 2, Sch 1 (14).
24
Penalty
24 Penalty
24 Penalty
Any—
(a) contravention of, or failure to comply with, a provision of this Act or the regulations made under this Act, or
(b) failure to comply with a covenant contained in a trust deed,
shall be an offence under this Act.
Any person guilty of an offence under this Act shall be liable to a penalty not exceeding 10 penalty units or to imprisonment for a period not exceeding six months or to both such penalty and imprisonment.
s 24: Am 1992 No 112, Sch 1.
25
25
25 (Repealed)
26
Proceedings for offences
26 Proceedings for offences
26 Proceedings for offences
(1) Proceedings for an offence under this Act may be dealt with summarily before the Local Court.
(2) No prosecution for an offence under this Act is to be instituted except with the consent in writing of the Minister.
(3) Proceedings for any offence under this Act may be instituted at any time within a period of twelve months after the commission of the offence.
s 26: Am 1988 No 131, Sch 29. Subst 2007 No 94, Sch 1.54.
27
Savings
27 Savings
27 Savings
Nothing in this Act shall—
(a) affect the liability of any person for an offence with which the person might be charged otherwise than under Part 3,
(b) invalidate any contract or mortgage or other instrument evidencing or affecting the title to any land,
but where an instalment contract is entered into in contravention of Part 3, or the vendor fails to comply with any stipulation or undertaking to be complied with by the vendor and implied by Part 3 in an instalment contract, the purchaser shall be entitled by notice in writing served on the vendor to rescind the instalment contract and thereupon shall be entitled to recover as a debt any moneys paid by the purchaser under the instalment contract in any court of competent jurisdiction.
s 27: Am 1978 No 2, Sch 1 (15).
28
Notices
28 Notices
28 Notices
The provisions of section 170 of the Conveyancing Act 1919 relating to the service of notices shall apply to Part 3, and for the purposes of such provisions the last place of abode or business of a trustee under a trust deed referred to in Part 3 or of a vendor by whom such a trustee has been appointed includes the address for service of notices on the trustee or vendor, as the case may be, specified in the trust deed.
s 28: Am 1978 No 2, Sch 1 (6) (c) (15).
29
Regulations
29 Regulations
29 Regulations
(1) The Governor may make regulations, not inconsistent with this Act—
(a) varying or adding to any of the Schedules to this Act,
(b) exempting from the provisions of Part 3 any class of vendors or any class of instalment contracts,
(c) prescribing all matters which by this Act are required or permitted to be prescribed or which are necessary or convenient to be prescribed for carrying out or giving effect to this Act.
The Schedules as varied or added to pursuant to any such regulations shall be the Schedules to this Act.
(1A) A regulation may be made so as to include in a notice or other document under this Act matter relating to any provision of or made for the purposes of section 52A of the Conveyancing Act 1919.
(2) (Repealed)
(3) A regulation may apply differently according to such factors as may be specified in the regulation.
s 29: Am 1978 No 2, Sch 1 (15) (16); 1985 No 143, sec 3; 1987 No 48, Sch 32.
30
Savings and transitional provisions
30 Savings and transitional provisions
30 Savings and transitional provisions
The Sixth Schedule has effect.
s 30: Ins 1998 No 4, Sch 1 [5].
Schedule 1
Schedule 1
First Schedule
(Section 7 (1) (f) (iv))
LAND SALES ACT 1964
NOTICE TO PURCHASER
To ............................................................
............................................................
According to the books of account kept by me, you have now paid at least fifteen per centum of the purchase price payable under instalment contract dated .............................. for the sale of lot number .................... in a plan of subdivision which has been registered in the office of the Registrar-General as .............................. (quote registered number; if the plan is unregistered give description of lot).
Under section 13 of the abovementioned Act, upon payment of fifteen per centum of the purchase price, you are entitled, by serving a notice in writing on .............................. (name of vendor) the vendor, to require the vendor to transfer or convey to you the lot purchased by you, but only if you execute a mortgage in favour of the vendor securing payment of the unpaid purchase money.
If you need assistance to enable you to exercise your rights mentioned above, you should consult your solicitor.
..............................(Trustee)
Schedule 2
Schedule 2
Second Schedule
(Section 7 (1) (f) (iv))
LAND SALES ACT 1964
NOTICE TO VENDOR
To ............................................................
............................................................
According to the books of account kept by me, the purchaser of lot number .................... in the plan of subdivision which has been registered in the office of the Registrar-General as .............................. (quote registered number; if the plan is unregistered, give description of lot) has now paid at least fifteen per centum of the purchase price payable under instalment contract dated .............................. for the sale of that lot.
..............................(Trustee)
Schedule 3
Schedule 3
Third Schedule
(Section 7 (1) (f) (v))
LAND SALES ACT 1964
NOTICE TO PURCHASER
To ............................................................
............................................................
the purchaser of lot number .................... in a plan of subdivision which has been registered in the office of the Registrar-General as .............................. (quote registered number; if the plan is unregistered give description of lot).
I have received a notice under section 14 (1) of the abovementioned Act, stating that the vendor to you of the abovementioned lot intends to charge the lot with a security which could enable your interest in the lot to be overreached. A similar notice should have been served by the vendor on you.
Under section 13 of the abovementioned Act, you are entitled, within 28 days after service of this notice on you, by serving a notice in writing on .............................. (name of vendor) the vendor, to require the vendor to transfer or convey to you the lot purchased by you, but only if you execute a mortgage in favour of the vendor securing payment of the unpaid purchase money. Unless you obtain a transfer or conveyance of the lot from the vendor, you could be deprived of all your rights in the lot purchased by you in certain circumstances, and it is therefore essential that you act without delay.
If you need assistance to enable you to exercise your rights mentioned above, you should consult your solicitor.
..............................(Trustee)
Schedule 4
Schedule 4
Fourth Schedule
(Section 12 (1))
LAND SALES ACT 1964
PARTICULARS OF TITLE
in respect of lot number .................... in a plan of subdivision which has been registered in the office of the Registrar-General as .............................. (quote registered number; if the plan is unregistered this fact must be stated) which said plan was approved by the Council of .............................. (name of local government area) on the .......... day of .................... 19....., as certified by general manager’s certificate number .................... of 19.....
The vendor of the said land is .............................. (state full name and address of vendor).
The legal owner of the said land is .............................. (state full name and address of legal owner) whose title is evidenced by .............................. (state distinctive reference allocated to the folio of the Register kept under the Real Property Act 1900, or lodgment number of the primary application or appropriate particulars, if old system title).
There is no outstanding equitable interest in the said land OTHER THAN .............................. (delete the words “other than” if inappropriate).
There is no form of security charged on the land within described which could enable the interest of a purchaser to be overreached by a creditor either directly or indirectly EXCEPT .............................. (delete the word “except” if inappropriate).
The name and address of the trustee for purchasers is ............................................................
..............................(Signature of vendor or the vendor’s duly
appointed attorney or seal of
vendor-company)
Signed in my presence by the vendor, or the vendor’s duly appointed attorney, who is personally known to me, ............................................................
..............................(Witness)
Fourth Schedule: Am 1978 No 2, Sch 1 (17); 1979 No 164, Sch 22; 1995 No 11, Sch 1.
Schedule 5
Schedule 5
Fifth Schedule
(Section 12 (1))
LAND SALES ACT 1964
ADVICE TO PURCHASERS
Fifth Schedule: Am 1978 No 2, Sch 1 (17) (19); 1998 No 4, Sch 1 [6]; 1999 No 31, Sch 5.57 [1]–[3].
Schedule 6
Savings and transitional provisions
Schedule 6 Savings and transitional provisions
Sixth Schedule Savings and transitional provisions
(Section 30)
Sixth Schedule: Ins 1998 No 4, Sch 1 [7].
Source text: opening excerpt
Sourced from legislation.nsw.gov.au, CC BY 4.0.
Part 1 Preliminary
Part 1 Preliminary
Part 1 Preliminary
pt 1, hdg: Ins 1978 No 2, Sch 1 (2).
1 Name of Act and commencement
1 Name of Act and commencement
1 Name of Act and commencement
(1) This Act may be cited as the Land Sales Act 1964.
(2) This Act shall commence upon a day to be appointed by the Governor and notified by proclamation published in the Gazette.
s 1: Am 1978 No 2, Sch 1 (3).
1A
1A (Repealed)
1A
s 1A: Ins 1978 No 2, Sch 1 (4). Rep 1988 No 131, Sch 29.
Part 2
Part 2
1B–1E (Repealed)
pt 2: Ins 1978 No 2, Sch 1 (4). Rep 1987 No 195, sec 3.
s 1B: Ins 1978 No 2, Sch 1 (4). Subst 1980 No 152, Sch 1 (1). Rep 1987 No 195, sec 3.
s 1C: Ins 1978 No 2, Sch 1 (4). Am 1980 No 152, Sch 1 (2). Rep 1987 No 195, sec 3.
s 1D: Ins 1978 No 2, Sch 1 (4). Subst 1980 No 152, Sch 1 (3). Rep 1987 No 195, sec 3.
s 1E: Ins 1978 No 2, Sch 1 (4). Am 1980 No 152, Sch 1 (4). Rep 1987 No 195, sec 3.
Part 3 Sale of land under instalment contracts
Part 3 Sale of land under instalment contracts
Part 3 Sale of land under instalment contracts
pt 3, hdg: Ins 1978 No 2, Sch 1 (5).
2 Definitions
2 Definitions
2 Definitions
In this Part, unless the context or subject matter otherwise indicates or requires—
Instalment contract means a contract, entered into after the commencement of this Part, for the sale of a lot in a subdivision comprising five or more lots where such contract provides for the purchase money to be paid by four or more part payments (whether by way of preliminary or other deposit or otherwise) and any option to purchase such a lot under which all or part of the consideration for the granting of such option (whether or not such consideration is to be applied to the purchase price) is payable by four or more part payments as aforesaid, but does not include—
Ministerial and Registrar-General roles: the Minister approves trust deeds and trustees and may revoke approval, appoint a trustee in default, and make orders exempting subdivisions from specified requirements (ss 4(c), 5, 6). The Registrar-General approves the form of notices for charging (s 14(1), Sixth Schedule cl 2).
The text does not include policy justifications as formal recitals. The Act’s detailed procedures, schedules and protective devices indicate an objective of purchaser protection, document standardisation and risk containment for instalment purchasers, especially where Torrens registration is not yet complete. The statutory design centralises certain decisions with the Minister and Registrar-General, prescribes documentary form and timing, and creates criminal offences and civil rescission remedies for non-compliance (ss 24, 27). These mechanically alter vendor, trustee and purchaser behaviour by imposing timing, custody and disclosure obligations, and by creating implied contractual rights enforceable in court.
Main concepts
Definitions and thresholds determine the Act’s reach and the allocation of duties. Key concepts from the text are:
Instalment contract, s 2: a contract entered into after the Part commenced, for a lot in a subdivision of five or more lots, where purchase money is paid by four or more part payments. The definition reaches options where the consideration for the option is payable by four or more part payments. The definition also expressly excludes sales without resubdivision by a vendor who acquired fewer than five lots (s 2(a)), and strata scheme lots (s 2(b)).
Subdivision compliance, ss 3-4: s 3 makes the Part mandatory for sales by instalment contracts, s 4 sets the criteria a subdivision must meet at the time of sale: either the land is under the Real Property Act 1900, or a plan had been registered before the commencement of the Act, boundaries must follow a plan with a subdivision certificate under s 109C EPA Act, development consent must be in force where required (s 4(b1)), and a trustee must be appointed under an approved trust deed (s 4(a)-(c)).
Trust deed and trustee duties, s 7: a trust deed must make provision for appointment and replacement of a trustee, annex forms of instalment contract and mortgage, require trustee retention of purchaser moneys until authorised or conditions are met, provide trustee access to vendor books (s 7(e)), and bind the trustee to exercise vigilance, keep accounts, and serve statutory notices once 15 per cent is received (s 7(f)(i)-(iv)). The deed must specify addresses for service (s 7(g)). The trustee and appointed registered public accountant are subject to confidentiality obligations with specified exceptions (s 7(2)).
Notices, schedules and prescribed forms, s 12 and Schedules: notice in the form of the Fourth Schedule (Particulars of Title) and Fifth Schedule (Advice to Purchasers) must be given before receiving initial payments and at least 24 hours before tendering contracts (s 12(1)). Receipts for preliminary deposits must be endorsed "sale by instalment contract" (s 9(1)). The Schedules supply model notices the Act requires trustees or vendors to use (Schedules 1-5).
Purchaser protections and implied terms, ss 13-16: s 13 implies a right to require transfer upon payment of 15 per cent and execution of a mortgage back; ss 15-16 impose vendor undertakings where plans are unregistered or where primary applications are involved, and s 17 voids contractual clauses that deprive purchasers of remedies for vendor delay.
Void stipulations, ss 18-21: provisions that exempt trustees from liability, require purchasers to pay trustees’ costs, or limit the purchaser’s choice of professional adviser are void (ss 18-20). Payment to trustee or agent is deemed payment to the vendor (s 21) while preserving remedies against trustee.
Enforcement and penalties, ss 24-27: contraventions and failures are offences (s 24) with maximum penalty of 10 penalty units or six months imprisonment, proceedings are summarily dealt with in the Local Court (s 26(1)), require written consent of the Minister to prosecute (s 26(2)), and civil rescission and recovery of moneys are available where Part 3 is contravened (s 27).
Those concepts shape who does what and when: vendors must ensure subdivisions meet prescribed conditions and use approved trust deeds, trustees must hold funds and provide notices, purchasers receive prescribed information and statutory rights, and the Minister and Registrar-General have approval and form-approval powers.
Who it affects
The Act assigns responsibilities and rights to a small set of market participants and public officers. The principal actors and how they are affected are:
Vendors and their agents: vendors proposing to sell lots by instalment contract must ensure the subdivision complies with Pt 3 (s 3), appoint a trustee under an approved trust deed (s 4(c)), supply prescribed notices and particulars (s 12(1), Fourth and Fifth Schedules), tender only the trust-deed-annexed instalment contract forms (s 10(1)), deliver a counterpart executed by the vendor within 21 days when the purchaser complies (s 10(2)), and comply with implied undertakings regarding registration and primary applications (ss 15-16). Vendors cannot accept instalment payments (other than preliminary deposits) directly unless the trustee has certified 15 per cent has been paid (s 11). Vendors may be required to fund trustee remuneration or comply with terms imposed by Ministerial approval when replacement trustees are appointed (s 5(3)).
Trustees and registered public accountants: trustees are the statutory custodians of specified purchaser moneys, must keep proper accounts, exercise due diligence in protecting purchaser interests, serve statutory notices once 15 per cent is received (s 7(f)), and may be required to allow trustee-appointed registered public accountants access to vendor books (s 7(e)). Trustees are subject to confidentiality restrictions with express exceptions (s 7(2)). The Minister approves trustees and may revoke approval (s 5). Trustees can be appointed by the Minister to replace a vendor-appointed trustee under terms the Minister thinks fit (s 5(3)). The trust deed must annex the forms of instalment contract and mortgage used in the subdivision (s 7(c)).
Purchasers: purchasers or persons paying preliminary deposits must receive specified notices (s 12(1)), receipts for certain preliminary deposits must be endorsed "sale by instalment contract" (s 9(1)), purchasers acquire an implied right to require transfer upon paying 15 per cent and executing a mortgage back (s 13(1)), purchasers are protected from certain contractual stipulations (ss 17-20), and purchasers can rescind where Part 3 has been contravened and recover monies paid as a debt (s 27).
Minister and Registrar-General: the Minister approves trust deeds and trustees and has power to revoke approval, appoint replacement trustees, and make exemptions or impose conditions (ss 4(c), 5, 6). The Registrar-General approves forms of notice for charging lots (s 14(1)), and s 29 and the Sixth Schedule give the Governor and regulations scope to extend or adapt forms and transitional saving provisions.
Local councils and statutory Crown bodies: these entities are direct market participants and also appear in exclusions. An instalment contract is exempt from Part 3 where the vendor is a statutory Crown body or a local council and the subdivision is under the Real Property Act (s 6(2)). S 4(b1) requires development consent to be in force where the subdivision requires development consent under the EPA Act.
Conveyancers and solicitors: the Act references licensed conveyancers (s 2). Section 7(c) requires annexation of forms of mortgage; s 13(1)(iii) references preparation costs limited by any General Order under s 206 of the Conveyancing Act 1919. Section 20 forbids stipulations that require the purchaser to use a solicitor/conveyancer appointed by the vendor.
Other affected parties include assignees of instalment contracts (s 14(4)), mortgagees who may be directed by vendors under mortgage back arrangements (s 13(1)(i)-(iii)), and persons dealing with advertising (s 8). The Act therefore determines which participants handle funds, who must provide what information and when, who may be restricted from particular practices, and which public officers control approval and enforcement levers.
Key duties and rights
This section outlines the precise statutory duties imposed on vendors, trustees and agents, and the rights created for purchasers, citing the statutory text.
Vendor duties
Ensure compliance before sale: no sale under an instalment contract is permitted unless the subdivision complies with Pt 3 (s 3), and s 4 lists compliance conditions including Trustee approval by the Minister (s 4(c)), plan/Real Property Act status (s 4(a)(i), (iii)), subdivision certificate (s 4(b)), and development consent where required (s 4(b1)).
Use approved contract form and deliver executed counterpart: a vendor or agent shall not tender a contract unless it is in the form annexed to the trust deed (s 10(1)). Where the purchaser executes and returns the copy, the vendor must deliver a counterpart executed by the vendor within 21 days (s 10(2)).
Lodge transfers and conveyances: where Title is under the Real Property Act and a transfer executed under s 13 is held by the vendor, the vendor must lodge it with the Registrar-General with prescribed fees and notify purchaser/solicitor and facilitate registration (s 22). Equivalent duties apply for conveyances where the lot is not under the Real Property Act (s 23).
Provide notices and particulars: vendors must ensure that before any initial payment is received the purchaser is given the Fourth and Fifth Schedule notices and at least 24 hours before tendering the contract (s 12(1)). The Fourth Schedule must be legible and in certain font size (s 12(3)(b)), and signature requirements apply (s 12(2)).
Do not accept instalments direct until trustee confirmation: no person other than the trustee shall accept payments other than preliminary deposits unless the trustee has given a Second Schedule notice confirming 15 per cent paid (s 11).
Trustee duties
Hold and account for moneys: trustees must retain moneys received from purchasers until authorised to refund or until conditions are satisfied, keep proper books and account punctually for moneys (s 7(d), s 7(f)(ii)-(iii)).
Exercise diligence for purchasers: trustees must exercise due diligence and vigilance in protecting purchasers’ rights (s 7(f)(i)).
Serve statutory notices: on receipt of 15 per cent, trustees must serve the First Schedule notice to purchasers and the Second Schedule to vendors, and serve the Third Schedule in the event of a notice under s 14(1) (s 7(f)(iv)-(v)).
Provide inspection and information: trustees may demand access to vendor books and the vendor must comply (s 7(e)). Confidentiality obligations apply to trustees and appointed accountants with specified exceptions (s 7(2)).
Purchaser rights
Information and cooling measures: purchasers must be given prescribed particulars and advice before initial payments and before contract tendering (s 12(1), Fourth and Fifth Schedules).
Receipt and protection of preliminary deposit: where an agreement requires the vendor to enter an instalment contract, a receipt for preliminary deposit must be endorsed "sale by instalment contract" (s 9(1)), and the vendor must within seven days pay the deposit to the trustee or authorise refund (s 9(2)(a)). Where a copy contract is tendered the vendor may be prohibited from re-selling for a prescribed period (s 9(2)(b)).
Right to require transfer on payment of 15 per cent: implied right to require the vendor to execute instruments to assure title, provided purchaser has paid not less than 15 per cent and executes a mortgage back securing the unpaid purchase money (s 13(1)). Time limits and form requirements apply (s 13(1)(i)-(iii)).
Remedies for contravention: where Part 3 is contravened, the purchaser can rescind by notice in writing and recover moneys paid as a debt (s 27).
Statutory voids and protections
Certain contractual terms are void: clauses that deprive purchasers of remedies for vendor delay (s 17), exempt or indemnify trustees against liability (s 18), make purchasers pay trustee costs (s 19), or dictate purchaser choice of solicitor/conveyancer (s 20) are void to the extent they operate contrary to the Act.
Ministerial powers and regulatory instruments
Minister may grant exemptions and approve trustees and trust deeds with conditions, revoke approvals and appoint replacement trustees, and those appointments and conditions may bind vendors (ss 4(c), 5, 6).
Regulations and gubernatorial powers may vary Schedules, exempt classes of vendors/contracts and prescribe necessary matters (s 29).
These duties and rights are prescriptive, allocate custody and information duties to trustees and vendors, and embed purchaser protections into contract law by implication and by voiding inconsistent stipulations.
Penalties and enforcement
The Act combines criminal penalties, summary jurisdiction, prosecutorial controls and civil remedies. Key enforcement and penalty mechanisms are:
Criminal offences and penalties: contravention of any provision of the Act or the regulations, or failure to comply with a covenant in a trust deed, is an offence (s 24). The maximum statutory penalty is up to 10 penalty units or imprisonment for up to six months, or both (s 24). The Act does not distinguish penalty levels by specific contravention; the same maximum applies across breaches.
Summary proceedings: offences may be dealt with summarily in the Local Court (s 26(1)). The Act therefore channels criminal enforcement into lower court processes rather than indictable proceedings.
Ministerial consent to prosecution: no prosecution for an offence under the Act may be instituted except with the written consent of the Minister (s 26(2)). This is a procedural gatekeeper that centralises prosecutorial initiation in the executive, rather than permitting private prosecutions or immediate police action without Ministerial consent.
Statute of limitations for prosecutions: proceedings must be instituted within 12 months after the commission of the offence (s 26(3)). That is a short statutory limitation period which can bar prosecutions for older breaches.
Civil remedies and rescission: notwithstanding the criminal provisions, the purchaser has a civil right to rescind an instalment contract entered into in contravention of Pt 3 or where the vendor fails to comply with an implied undertaking, and to recover monies paid as a debt in any court of competent jurisdiction (s 27). This preserves a direct civil pathway for purchasers to obtain restitution.
Administrative remedies: the Minister may revoke trustee approval and appoint a substitute trustee under terms the Minister thinks fit; that substitute can be given powers to account and hold obligations for customers of prior sales made before appointment (s 5(1)-(3)). These are administrative remedies to protect purchasers where trustees lose approval or fail.
Regulatory instruments and sanctions: Regulations under s 29 may prescribe additional matters and Schedules may be varied by regulation, which can affect compliance obligations and thus enforcement parameters.
Practical enforcement implications derived from the statute include:
A prosecutorial filter in s 26(2) can result in few criminal proceedings initiated without Ministerial will; enforcement may therefore be concentrated in civil rescission and administrative interventions by the Minister.
The maximum monetary penalty is modest in commercial contexts, and the presence of imprisonment power introduces non-monetary risk for serious breaches.
The 12-month limitation may impose urgency on detection and reporting of offences.
Buyers have direct civil remedies irrespective of criminal proceedings, and these are not constrained by Ministerial consent provisions applied to criminal prosecutions (s 27).
The Act therefore places primary remedial weight on civil rescission and administrative replacement of trustees, supplemented by criminal sanctions that are subject to executive control.
How it interacts with other laws
The Act is expressly cross-referential and designed to operate alongside multiple property, planning and conveyancing statutes. The explicit interplays in the text are:
Real Property Act 1900: the Act treats parcels under the Torrens system differently. A subdivision complies with the Part if the land is under the Real Property Act (s 4(a)(i)). Several obligations reference registration and folios kept under the Real Property Act, including vendor duties to lodge transfers for registration (s 22) and purchaser protections such as lodging caveats or registering contracts for land under the Real Property Act mentioned in Schedule 5 para 8.
Environmental Planning and Assessment Act 1979: "Subdivision" is defined by reference to s 4B of the EPA Act (s 2). Section 4(b) requires boundaries to follow a plan of subdivision that carries a subdivision certificate under s 109C EPA Act. Section 4(b1) requires development consent to be in force where the subdivision requires consent under the EPA Act. Those references integrate planning approvals with the ability to sell by instalments.
Conveyancing Act 1919: the Act imports procedural rules. s 13(1)(iii) limits mortgage preparation costs to amounts prescribed by any General Order under s 206 of the Conveyancing Act 1919. Section 28 applies the Conveyancing Act s 170 service-of-notices provisions to Part 3. Section 29(1A) permits regulations to include matter relating to s 52A of the Conveyancing Act 1919.
Conveyancers Licensing Act 1992: definitions reference the licensed conveyancer concept (s 2), indicating that professional advice referenced in undertakings and implied cost refunds (s 9(2)(a)(i)) may be given by licensed conveyancers as well as solicitors.
Stamp Duties Act 1920 (repealed wording in text): ss 22 and 23 refer to conveyances "duly stamped within the meaning of the Stamp Duties Act 1920" as part of vendor obligations. The text retains the reference to stamping as a prerequisite for lodging transfer or conveyance for registration.
Local government and Crown statutory bodies: s 6(2) exempts instalment contracts where the vendor is a statutory body representing the Crown or a local council and the subdivision is under the Real Property Act, so local government disposes are treated differently.
Regulations and forms: s 29 authorises regulations to vary or add to Schedules and exempt classes of vendors or contracts, which can change the operational interface between the Act and other regulatory regimes.
Consequences of these interactions:
The Act creates layered compliance duties on top of planning and registration regimes; a vendor must observe planning certificate and development consent rules (s 4(b), (b1)) as a prerequisite to selling by instalments.
Registration mechanics under the Real Property Act are integrated with purchasers’ implied rights to obtain transfer and mortgage documents (ss 13, 22).
Conveyancing practice and the costs regime under the Conveyancing Act are directly implicated when purchasers exercise the right to require transfer and mortgage (s 13(1)(iii)).
Ministerial and Registrar-General powers can affect forms and notices that interface with existing conveyancing instruments (s 14(1), s 29).
Practitioners must therefore treat Pt 3 obligations as an overlay on land registration, planning consent, stamp duty and conveyancing regimes, checking that compliance with one statute does not inadvertently cause non-compliance with the other referenced statutory obligations.
Amendment history
The text includes amendment notations in the margins; the Act has been varied repeatedly. The source-provided amendment markers show the following recorded changes and insertions:
1978 No 2: multiple insertions and schedule changes, indicated across Pt 1 and Pt 3 headings and numerous sections (s 1, s 2, s 3, s 4, s 5, s 7, s 9, s 10, s 12, s 13, s 17, s 18, s 19, s 20, s 22, s 23, s 24, s 28, s 29). The 1978 amendments inserted Pt 3 headings and added schedule amendments noted at multiple sections.
1980 No 152: amendments to sections 1B-1E (now repealed), and changes noted to definitions in s 2 (Sch 1 (4)).
1986 No 220: amendment to s 2, definition insertions noted c.f. Sch 1.
1987 No 195: repeal of several earlier inserted subsections and parts (pt 2).
1988 No 131: repeal of s 1A and amendment to s 26 (amendments indicated).
1992 No 55: amendments to definitions and insertion of licensed conveyancer concept into s 2; s 24 amended in 1992 No 112 Sch 1 (amendment noting).
1995 No 11 and 1996 No 139: amendments to schedules and s 2 respectively (s 2 amended 1996 No 139, Sch 2.19).
1997 No 152: amendments to s 2 and s 4 (Sch 4.19).
1998 No 4 (Land Sales Amendment Act 1998): various amendments to s 6, s 9, s 14, schedule and transitional provisions; Sixth Schedule inserted (s 30) and Sixth Schedule references to the 1998 amendment appear (Sixth Schedule cl 1-3). Land Sales Regulation 1997 cl 5 continued to apply to certain undertakings per Sixth Schedule cl 3(3).
1999 No 31: amendments to Fifth Schedule (Sch 5.57).
2007 No 94: substitution in s 26 (Sch 1.54), adjusting the period or process for proceedings.
2011 No 2: repeal of s 25 (s 25 repealed).
2015 No 51: s 2 amended to exclude strata schemes (Sch 9.11).
2021 No 10: amendments to s 4 and s 16 (Sch 3.16[1][2][3]) implying updates to the subdivision/development consent interface and primary application undertaking provisions.
The Sixth Schedule was inserted in 1998 to manage savings and transitional matters arising from the 1998 amendment (Sixth Schedule cl 1-3). Several earlier sections and subsections were repealed over time, as noted in the marginal notes (for example, s 1A repealed 1988 No 131, Sch 29; s 1B-1E repealed 1987 No 195).
This amendment history as recorded in the Act source identifies recurring themes: updating definitions (subdivision, licensed conveyancer, exclusion of strata), procedural adjustments to notices and forms, and alignment with planning and conveyancing reforms. Practitioners should use the textual marginalia to confirm which versions of forms and transitional rules still apply to pre-amendment undertakings and contracts (Sixth Schedule cl 3).
Litigation history
The statute text supplied contains no reported judicial decisions, case names or explicit litigation summaries. The Act itself creates civil remedies and criminal offences, but the source does not catalogue any judicial interpretations or precedent.
Practical implications for litigation that follow from the statutory structure are:
Civil litigation: purchasers may sue for rescission and recovery of moneys paid where Part 3 has been contravened (s 27). Courts will likely be asked to adjudicate on whether statutory requirements were met, whether notices were properly served and whether implied terms (e.g. s 13) are exercisable. The Act preserves the purchaser’s civil remedies and does not preclude other claims arising under general contract or equity (s 27(a)-(b)).
Enforcement and criminal proceedings: prosecutions under the Act require the Minister’s written consent (s 26(2)). That procedural requirement will affect case law volume, because private prosecutions are constrained, and decisions to prosecute will reflect administrative priorities.
Evidential and procedural litigation points: s 12(3) makes non-compliance with notice requirements potentially excusable if the court is satisfied the failure was accidental or not misleading; litigation will hinge on judicial assessment of "material mis-statement or inaccuracy" and whether the purchaser was misled. The Act’s provisions on the form, legibility and font size of notices (s 12(3)(a)-(b)) invite particularised factual inquiry in disputes.
Administrative law: decisions by the Minister under s 4(c), 5 and 6 to approve or revoke trustees and trust deeds and to make exemptions may attract judicial review on conventional administrative law grounds where a party challenges the exercise of statutory power. The text allows conditions attached to approvals (s 4(c)), Ministerial revocation (s 5) and appointment of a trustee by the Minister (s 5(3)). The Act does not specify an internal merits appeal mechanism, so judicial review may be the primary avenue for challenging decisions.
Because the Act text contains no case citations, practitioners must search external legal databases for reported decisions concerning s 12(3) excusals, the exercise of the right under s 13, disputes over trustee accounting under s 7(e)-(f), or Ministerial appointment/revocation decisions under s 5. The absence of litigation history in the text means that statutory ambiguities remain to be informed by case law not supplied here.
Gotchas
The Act contains specific traps for vendors, agents, trustees and purchasers that practitioners should flag because non-compliance produces loss of contractual entitlement, civil rescission rights, or criminal exposure.
Notices, receipts and form compliance
Receipt wording triggers statutory consequences: receipts for preliminary deposits must bear the words "sale by instalment contract" where the deposit relates to an agreement whose implementation would necessitate an instalment contract (s 9(1)). Failure to issue the receipt or use the exact words can prevent statutory protections that flow from s 9, such as the trustee custody requirement and the vendor’s tendering obligations.
Timing and delivery windows have strict consequences: the vendor must within seven days pay a preliminary deposit to the trustee or authorise refund (s 9(2)(a)). If a vendor fails to tender a copy of the instalment contract or fails to pay to the trustee within the time-limit, the purchaser may lose protections or be able to rescind.
Prescribed period prevents re-sale: if the vendor tenders the instalment contract, the vendor cannot re-sell during the "prescribed period" (an initial 14 days plus a potential additional 7 days if ss 10(2)(a) conditions are complied with) unless the purchaser authorises otherwise (s 9(2)(b)). Miscounting or failing to observe the prescribed period can lead to claims by purchasers.
Notices must meet legibility and font requirements: s 12(3) makes failure to comply with form and font size (no smaller than 10 point Times) a statutory failure that will only be excused by a court upon particular findings. Low-quality printing or small font can be a litigable defect.
Trustee and vendor practical pitfalls
Trustee approvals and Ministerial discretion: the Minister’s power to approve trustees, revoke approval and appoint substitute trustees (ss 4(c), 5) is extensive. Vendors who rely on a trustee later revoked may face administrative imposition of a Minister-appointed trustee whose remuneration or terms could be imposed on the vendor (s 5(3)), with financial consequences.
Trustee indemnities and purchaser charges invalid: any clause seeking to charge purchasers for trustee expenses is void (s 19). Vendors who attempt to pass trustee costs to purchasers through contract will find those clauses unenforceable.
Payments to trustee are payments to vendor: s 21 deems payments to trustees or vendor agents to be payments to the vendor. That statutory deeming can have surprising effects on priority disputes between vendor and trustee or purchaser and trustee; practitioners must treat fund custody provisions carefully.
Vendor charging and purchaser protection traps
Vendor cannot charge without prescribed notice and delay: s 14 requires the vendor to give a Registrar-General-approved form of notice before charging the lot with security that could overreach the purchaser. A vendor who charges without complying exposes purchasers to statutory rights to require transfer (s 14(1)-(2)).
Purchaser’s right to demand transfer involves mortgage back formalities and costs: s 13 requires the purchaser to execute a mortgage back in a prescribed or agreed form and limits mortgage preparation costs to amounts fixed under the Conveyancing Act, but there are procedural steps and costs the purchaser must meet. Practitioners should note the time limits (28 days in certain contexts, s 13(1)(b)).
Enforcement and procedural traps
Prosecutions constrained by Ministerial consent and 12-month limitation: criminal enforcement is not automatic; it requires Ministerial consent (s 26(2)) and must be commenced within 12 months (s 26(3)). This can lead to situations where contraventions exist but criminal redress is unavailable due to delays or policy choices.
Remedies are preserved but procedural: notwithstanding criminal constraints, purchasers can rescind and recover moneys as debt (s 27). However, recovery depends on civil litigation and timing, and the Act does not create an automatic restitution mechanism.
Advertising prohibition
Advertising restrictions are tight: s 8 forbids any advertisement that says a trustee or trust deed has been approved by the Minister or that refers to the Act in any way. Vendors or marketers referencing statutory approval risk prosecution if they create advertising to that effect.
Form annexation and mortgage forms
The trust deed must annex the exact instalment contract and mortgage forms (s 7(c)), and s 10(1) prohibits tendering forms other than those annexed. Drafting errors in those annexed forms can therefore lock parties into unintended contract terms or produce compliance failures.
In short, strict compliance with textual form, timing and custody requirements is required; small procedural lapses can produce rescission, civil claims, administrative intervention or criminal liability subject to Ministerial consent. Practitioners must track the precise time limits and ensure documents conform to prescribed forms and legibility requirements.
How to comply
This practical compliance checklist is structured by role: vendor (or vendor’s agent), trustee, purchaser and adviser. Cross-reference to sections is provided to locate the statutory requirement.
For vendors and vendor agents
Establish whether Pt 3 applies: confirm the sale is an "instalment contract" under s 2 and that the subdivision contains five or more lots. If excluded categories apply (s 2 exclusions, s 6(2) exemptions), document the basis.
Ensure subdivision compliance before sale: verify the land is under the Real Property Act or the plan was registered before commencement (s 4(a)), confirm plan boundaries follow an endorsed subdivision certificate under s 109C EPA Act (s 4(b)), ensure development consent is in force where required (s 4(b1)), and confirm a trustee with an approved trust deed is appointed (s 4(c)).
Appoint an approved trustee under a compliant trust deed: ensure the trust deed contains required clauses per s 7 (appointment/replacement, annexed contract/mortgage forms, retention and release rules for moneys, trustee covenants, addresses for service). Obtain Ministerial approval for the trustee and trust deed, noting the Minister may attach conditions (s 4(c), s 5).
Use annexed contract and mortgage forms: tender only instalment contract forms annexed to the trust deed (s 10(1)), and, upon purchaser compliance, deliver a vendor-executed counterpart within 21 days (s 10(2)).
Handle preliminary deposits correctly: if accepting a preliminary deposit that would lead to an instalment contract, give the payer a receipt endorsed "sale by instalment contract" (s 9(1)), and within 7 days either pay the deposit to the trustee and tender a contract with the undertaking to refund reasonable advisory costs (s 9(2)(a)(i)), or authorise the trustee to refund and inform the purchaser if unwilling/unable to execute the instalment contract (s 9(2)(a)(ii)). Respect the prescribed period preventing re-sale (s 9(2)(b)).
Do not accept instalment payments other than trustee: do not accept instalment payments (other than preliminary deposits) unless you have a trustee notice confirming 15 per cent payment (s 11). Accepting payments directly contrary to s 11 risks offence.
Provide required notices and particulars: before receiving any initial payment, deliver the Fourth and Fifth Schedule notices, at least 24 hours before tendering the contract (s 12(1)); ensure notices meet signature and legibility requirements (s 12(2)-(3)).
When registering transfers or conveyances, lodge promptly: follow s 22 and s 23 timing and notification obligations, provide the purchaser or purchaser’s solicitor an opportunity to inspect registration receipts, and notify purchasers when registration occurs (ss 22(b), 22(d), 23(b)).
If intending to charge the lot, follow s 14: give the Registrar-General-approved form of notice and observe the 28-day delay before charging (s 14(1)-(2)).
For trustees
Ensure the trust deed complies: confirm the trust deed contains the items in s 7(c)-(g), including annexed contract and mortgage forms, custody and release rules, and covenanted rights to inspect vendor books.
Custody and accounting: retain purchaser moneys until authorised or conditions are met (s 7(d)); keep proper books of account and be prepared to account punctually (s 7(f)(ii)-(iii)).
Serve statutory notices: on receipt of 15 per cent, serve the First Schedule notice on purchaser and Second Schedule on vendor (s 7(f)(iv)); if s 14(1) notice is received, serve Third Schedule notice (s 7(f)(v)).
Implement confidentiality: do not divulge vendor books acquired under s 7(e) except as allowed (s 7(2)), but be prepared to disclose to Minister or the purchaser, purchaser’s solicitor or licensed conveyancer as permitted.
Where required, appoint a registered public accountant and allow inspection: the trust deed should permit the appointment and the vendor must allow inspection and information (s 7(e)).
For purchasers
Obtain, read and preserve the Fourth and Fifth Schedule notices before paying an initial sum (s 12(1)); note the advice in the Fifth Schedule about enquiries, stamp duty, caveats and the 15 per cent right.
If paying a preliminary deposit, expect a receipt stating "sale by instalment contract" (s 9(1)). If you receive a contract and undertake, consult a solicitor or licensed conveyancer before signing (s 9(2)(a)(i) and Fifth Schedule para 2).
Track the trustee confirmation: do not pay instalments to the vendor unless the trustee has served the Second Schedule notice certifying 15 per cent has been received, unless the trustee has authorised release (s 11).
If 15 per cent is reached, you may exercise the right to require transfer: follow s 13(1) requirements, execute the mortgage back in the required form, meet limits on conveyancing costs and respect time limits in s 13(1)(b).
Preserve remedies and act promptly: where Part 3 has been breached, you may rescind and recover moneys as debt (s 27); civil steps should be initiated promptly given evidentiary and limitation issues.
For advisers (solicitors, licensed conveyancers, accountants)
Review annexed forms: ensure that the instalment contract and mortgage forms annexed to a trust deed are legally sound and compliant with s 7(c) and s 10(1).
Counsel clients on notice compliance: advise vendors on the exact content, legibility and signature compliance required by s 12(2)-(3), and purchasers on rights and caveats per Schedule 5.
Prepare for mortgage-back work within the cost limits referenced to Conveyancing Act s 206 (s 13(1)(iii)), and help purchasers calculate whether the mortgage-back is appropriate.
For trustees and vendors, ensure record-keeping and trustee obligations are implemented, particularly trustee accounts and audit rights under s 7(e).
Administrative and records practice
Keep meticulous evidence of service: for all notices under ss 9, 12 and 14 use documented methods that satisfy Conveyancing Act s 170 service rules as applied by s 28, and store copies with time-stamped proofs of service.
Maintain font and legibility compliance: ensure printed notices conform to s 12(3)(b) and are free of material inaccuracies that might mislead buyers.
Monitor Minister and Registrar-General approvals: confirm trustee and trust deed approvals and any Ministerial conditions before commencing sales; track any revocation risk under s 5 and have contingency plans for a Minister-appointed trustee.
Regulatory and exemption checks
Check regulation and Ministerial orders: s 6(1) allows Ministerial orders to exempt subdivisions from s 4(c) and other provisions; s 29 enables regulations varying Schedules and exempting classes of vendors. Confirm whether any applicable exemption has been made.
This compliance plan translates statutory obligations into operational tasks and emphasises documentation, timely action and use of the exact statutory forms and processes provided in the Act and Schedules.
Section 3Sales by instalment contracts of lots in subdivisions
(a) a contract effecting a sale without resubdivision by a vendor who acquired less than five lots in a subdivision, or
(b) a contract for the sale of a lot, or a leasehold interest in a lot, within the meaning of the Strata Schemes Development Act 2015.
Licensed conveyancer means the holder of a licence in force under the Conveyancers Licensing Act 1992.
Preliminary deposit means an initial payment (not being a payment, or part payment, for an option, other than an option referred to in the definition of instalment contract in this section) by a person in connection with the proposed purchase of a lot in a subdivision made to a person, or the agent of a person, who has offered, or held himself or herself out as being willing, to sell, or has advertised for sale, such lot, where the payment is made before there is a contract between such persons for the sale and purchase of such land.
Primary application means an application to the Registrar-General to bring land under the provisions of the Real Property Act 1900.
Purchaser includes a person (not being a person acting in the capacity of an agent for a vendor) by whom or on whose behalf a preliminary deposit is paid to a vendor.
Sell includes offer to sell, hold oneself out as being willing to sell, and advertise for sale.
Subdivision has the meaning given to subdivision of land by section 4B of the Environmental Planning and Assessment Act 1979.
s 2: Am 1978 No 2, Sch 1 (6); 1986 No 220, Sch 1; 1992 No 55, Sch 2; 1996 No 139, Sch 2.19 [1] [2] (am 1997 No 55, Sch 2.18 [1] [2]); 1997 No 152, Sch 4.19 [1]; 2015 No 51, Sch 9.11.
3 Sales by instalment contracts of lots in subdivisions
3 Sales by instalment contracts of lots in subdivisions
3 Sales by instalment contracts of lots in subdivisions
No person shall sell under an instalment contract any lot unless the subdivision in which the lot is comprised complies with the provisions of this Part.
s 3: Am 1978 No 2, Sch 1 (7).
4 Requirements as to subdivisions
4 Requirements as to subdivisions
4 Requirements as to subdivisions
A subdivision complies with the provisions of this Part if, at the time of the sale—
(a)
(i) the land comprised in the subdivision is under the provisions of the Real Property Act 1900, or
(ii) (Repealed)
(iii) although the land comprised in the subdivision is not under the provisions of the Real Property Act 1900, a plan of such subdivision has, before the commencement of this Act, been registered in the office of the Registrar-General, and
(b) the boundaries of the various lots in the subdivision follow the boundaries shown in a plan of subdivision that is endorsed with a subdivision certificate within the meaning of section 109C of the Environmental Planning and Assessment Act 1979, and
(b1) in the case of a subdivision that requires development consent under the Environmental Planning and Assessment Act 1979, such a consent is in force, and
(c) a trustee holds office under a trust deed that—
(i) relates to the subdivision,
(ii) complies with the provisions of this Part, and
(iii) has endorsed on it in writing the Minister’s approval of the trust deed and the trustee appointed thereby.
Any approval referred to in paragraph (c) may be given subject to such terms and conditions as the Minister thinks fit.
s 4: Am 1978 No 2, Sch 1 (6) (c) (8); 1997 No 152, Sch 4.19 [2]; 2021 No 10, Sch 3.16[1] [2].
5 Approval of trustee may be revoked
5 Approval of trustee may be revoked
5 Approval of trustee may be revoked
(1) The Minister—
(a) may by notice published in the Gazette revoke as on and from a day (not being earlier than the date of publication of the notice) to be specified in the notice the Minister’s approval under this Part of any trustee appointed under a trust deed, and
(b) shall in any such notice specify a date on or after which the Minister proposes to exercise the Minister’s powers under subsection (3) unless a new trustee, approved in writing by the Minister, has before that date been appointed to act in the place of the former trustee.
(2) Any such revocation shall take effect on and from the day specified in the notice and referred to in subsection (1) (a) and thereupon the trustee shall cease to hold office as such trustee for all purposes. The Minister shall as soon as practicable after publication of the notice cause a copy of the notice of revocation to be served on the trustee and the vendor by whom, or for whom and on whose behalf, the trustee was appointed.
(3) Where the Minister revokes the approval of any trustee as aforesaid and the vendor fails, before the date referred to in subsection (1) (b), to appoint a new trustee, approved in writing by the Minister, to act in the place of the former trustee the Minister may, by a trust deed executed by the Minister for and on behalf of the vendor (which trust deed the Minister is hereby authorised to execute) and that complies with the provisions of this Part, appoint, upon such terms and conditions as the Minister thinks fit, a new trustee to act in the place of the former trustee but only as regards the powers, authorities, duties and functions of the former trustee so far as they relate to sales of lots made before the appointment of the new trustee and to purchasers of such lots and the new trustee so appointed shall be deemed for the purposes of this Part to be the trustee under the trust deed in respect of sales of lots made before his or her appointment.
Any terms and conditions (including terms and conditions providing for the remuneration of the new trustee by the vendor or out of moneys held by the new trustee on behalf of the vendor) upon which the appointment of a new trustee may be made as aforesaid and that are expressed to be binding on the vendor and any covenants or provisions in the trust deed appointing the new trustee that are expressed to be made on behalf of, or to be binding on, the vendor shall be deemed to be terms and conditions binding on, covenants by and provisions binding on, the vendor.
(4) Nothing in this section prevents the vendor, where the Minister has appointed a new trustee in accordance with this section, from appointing a further trustee in accordance with the provisions of the trust deed under which the former trustee was appointed, to act as trustee under the trust deed in respect only of sales of lots made after his or her appointment.
s 5: Am 1978 No 2, Sch 1 (7) (9).
6 Exemptions
6 Exemptions
6 Exemptions
(1) The Minister may by order published in the Gazette declare that the requirements of section 4 (c) and such other provisions of this Part as may be specified in the order shall not apply to or in respect of any subdivision specified in the order and any such order shall have effect according to its tenor.
(2) An instalment contract for the sale of a lot in a subdivision of land under the provisions of the Real Property Act 1900, being a contract under which the vendor of the lot is—
(a) a statutory body representing the Crown, or
(b) a local council,
is exempt from the provisions of this Part.
s 6: Am 1978 No 2, Sch 1 (10); 1998 No 4, Sch 1 [1].
7 Trust deeds
7 Trust deeds
7 Trust deeds
(1) A trust deed complies with the provisions of this Part if it—
(a) makes provision for the appointment by the vendor for such period as the Minister may approve after the date of the certificate referred to in section 4 (b) of a person as trustee for purchasers of lots in the subdivision proposed to be sold,
(b)
(i) provides for the appointment by the vendor of a new trustee approved by the Minister to act under the trust deed, where the former trustee ceases for any reason to hold office before his or her duties as trustee have been completed, and also provides that such appointment shall be made subject to such terms and conditions as the Minister may think fit and for such period as the Minister may approve, and
(ii) contains a covenant binding the trustee that the trustee will, upon ceasing to be a trustee, transfer to the trustee appointed by the vendor under subparagraph (i), or by the Minister under section 5, any money held by the trustee or on the trustee’s behalf, and any books of account kept by the trustee, in his or her capacity as such trustee,
(c) has annexed thereto a copy of the form or forms of instalment contract to be used in connection with the sale of the land comprised in the subdivision (which form or forms shall provide that all moneys payable thereunder by way of preliminary or other deposit or fifteen per centum of the purchase price (whichever is the greater) shall be paid by the purchaser to the trustee) and the form or forms of mortgage to be used for the purposes of section 13,
(d) contains a provision that all moneys received by the trustee from a purchaser under an instalment contract shall be retained by the trustee until the trustee has been authorised by the vendor to refund any such moneys, or—
(i) the trustee is satisfied that the purchaser has been given the notices prescribed in section 12, and
(ii) an instalment contract signed by both the vendor and the purchaser or their properly constituted attorneys has been presented to the trustee for inspection and the written authority of the purchaser to account to the vendor for such moneys has been furnished to the trustee,
(e) contains a covenant binding the vendor that the vendor will, upon demand made by the trustee or any registered public accountant appointed by the trustee, make available for inspection the whole of the books of the vendor relating to the subdivision to which the trust deed relates and give to the trustee or to any such registered public accountant such oral or written information as the trustee or registered public accountant requires with respect to the subdivision to which the trust deed relates where inspection of such books or such information is necessary for the proper and effective carrying out of the trustee’s powers, authorities, duties and functions under this Part and the trust deed,
(f) contains covenants binding the trustee that the trustee will—
(i) exercise all due diligence and vigilance in carrying out the trustee’s powers, authorities, duties and functions in watching the rights and interests of the purchasers of lots in the subdivision to which the trust deed relates,
(ii) punctually account for all moneys paid to the trustee in pursuance of this Part in accordance with the provisions of this Part and the trust deed,
(iii) keep or cause to be kept proper books of account with respect to all moneys paid to the trustee as aforesaid,
(iv) where the trustee has received fifteen per centum of the purchase price of any lot in a subdivision to which the trust deed relates, serve on the purchaser of such lot a notice in writing duly completed in or to the effect of the First Schedule, and on the vendor of such lot a notice in writing in or to the effect of the Second Schedule, and
(v) where the trustee has received a notice referred to in section 14 (1), serve on the purchaser a notice in writing duly completed in or to the effect of the Third Schedule,
(g) shall specify addresses for the service of any notice or document respectively on the vendor and trustee in their capacities as such.
(2) Any trustee or registered public accountant who except in the course of any court proceedings, divulges or communicates to any other person any information which the trustee or registered public accountant has acquired pursuant to subsection (1) (e) shall be guilty of an offence under this Act—
Provided that nothing in this subsection precludes a trustee from divulging or communicating any such information to the Minister, or any such information that relates to the sale of a particular lot to the purchaser of that lot or the purchaser’s solicitor or licensed conveyancer.
s 7: Am 1978 No 2, Sch 1 (11); 1992 No 55, Sch 2.
8 Certain advertisements prohibited
8 Certain advertisements prohibited
8 Certain advertisements prohibited
No person shall publish or cause to be published any advertisement referring to a subdivision and containing a statement that, or to the effect that, a trustee or trust deed has been approved by the Minister or referring in any way to this Act.
9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract
9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract
9 Receipts for certain preliminary deposits to indicate that sale is by instalment contract
(1) Where a vendor or the vendor’s agent accepts a preliminary deposit in connection with the sale of a lot in a subdivision and such preliminary deposit is paid pursuant to an agreement (whether oral or in writing or partly oral and partly in writing), implementation of which would necessitate the vendor and purchaser entering into an instalment contract, the vendor or the vendor’s agent accepting the preliminary deposit shall upon doing so give to the person paying the preliminary deposit a receipt on which are endorsed the words “sa
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