The ACT government has passed new legislation that will protect off-the-plan buyers from sunset and development delay clauses.

The Legislative Assembly approved the 2021 Civil Law (Resale of Homes) Amendment Act, which was presented last month to protect buyers who did not plan and limit developers’ rights to cancel contracts.

Under the new law, developers can only use sunset and development delay clauses to rescind contracts if the buyer agrees to do so if they have been authorized by an order of the ACT Supreme Court.

Under this new law, a developer wishing to terminate a contract must give the buyer 28 days’ written notice stating the reasoning behind the proposed contract termination.

If the buyer does not agree, the developer must seek an injunction from the Supreme Court to allow the contract’s termination.

However, it is important for the developer to ensure that his reasoning to the Supreme Court is fair and equitable.

It is also critical to note that if the developer decides to take the matter to the Supreme Court, it will be liable for the buyer’s costs unless it has been able to determine that it has “unreasonably withheld its consent”.

Attorney General Shane Rattenbury said this new law will boost the confidence of all parties involved in off-the-plan contracts, especially following the recent trend of developers canceling contracts, causing personal distress for some buyers.

“The housing market is already stressful for buyers, and it’s often first-time homebuyers looking for off-the-plan purchases,” he said.

“It was important to act quickly to address these concerns and protect consumers from bad faith dissolutions.”

Photo by Daniel McCullough on Unsplash.

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