Proposed Changes to the Property Agents and Motor Dealers Act (PAMDA): Some relief in sight for residential developers, sellers and selling agents

The Property Agents and Motor Dealers and Other Legislation Amendment Bill 2010 (Qld) (Bill) was introduced to Parliament on 24 March 2010.

If passed by the Government, the changes will commence on 1 October 2010.

Changes to the PAMDA warning requirements

The amendments look to ease the strict warning requirements under the existing PAMDA with the major changes being as follows:

• residential sellers and selling agents will only need to direct the buyer’s attention to the warning statement once prior to the contract being signed by the buyer. This will remove the ambiguous second direction requirement;
• the buyer’s signature on the warning statement will be evidence that the buyer’s attention was directed to the warning statement prior to entering into the contract. This will reduce the need for ‘buyer’s acknowledgement’ documents;
• the warning statement must be attached to the contract. The requirement that the warning statement be attached to the contract as the “first and top page” of the contract has been removed.
  It is expected that new PAMDA forms will also be issued.

Changes to termination rights

The Bill also proposes to change contract termination rights so that a buyer’s right to terminate a contract for non-compliance with the warning statement provisions prior to settlement cannot occur later than 90 days after the day the buyer receives a copy of the relevant contract from the seller.

This will provide certainty to developers and sellers with longer term contracts.

How does the Bill propose to affect termination rights under existing contracts?

Once the Bill commences, buyers immediately lose any pre-existing right they may have to terminate under the existing notice provisions.

Buyers that have existing rights to terminate under the current PAMDA notice provisions will need to exercise their rights before the proposed commencement of the new provisions on 1 October 2010.

What about sales of residential units?

The Body Corporate and Community Management Act 1997 will be amended, to reflect the above changes to Chapter 11 of PAMDA.

If you have any further queries about either of these proposed legislative amendments please contact the Property Planning and Environment team on 07 3231 2444.

We will issue further alerts on the passage of this Bill.