What are Special Conditions in a contract?
Every contract has standard terms and conditions which are applicable and these are intended for the purpose of covering either party in a transaction from standard issues. Special conditions are imposed and agreed upon by both parties before a contract for sale or purchase is signed.
Some of the more standard special conditions which buyers will want to include are:
Subject to finance – a very specific condition which need clear clarification that in the event that the purchased does not gain approval from their chosen lender at agreeable interest rates they have the option of allowing the contract to lapse without repercussions.
Subject to satisfactory building and pest inspection and report – A building and pest inspection is carried out to satisfy the purchaser that the building they are buying is in sound condition.
Subject to satisfactory asbestos report – Similar to the building and pest and asbestos inspection is to satisfy the purchaser that the risks of asbestos are minimal or not apparent. Dependent upon the house and its age and condition the contract may already state that asbestos is present and the purchaser is buying the house will knowledge of this. A good conveyancer will pick this up before you sign the contract to ensure you are happy with this.
Sale of the purchases house – Negotiations can be made with the vendor on an acceptable time frame for the purchases house to sell. This may include other conditions such as the purchaser needs to already have a contract on their house and settlement date organised.
Repairs or removal or rubbish – The state of the property upon settlement should be made clear in the contract giving the vendor ample opportunity to rectify small repairs or have rubbish removed prior to settlement.
Once these conditions have been agreed upon and implemented into the contract both parties must make every effort to fulfil them. In the instance that special conditions are not met, then the contract lapses and becomes unenforceable, meaning that the vendor cannot insist on the purchase continuing or sue for breach of contract.
When you are first looking at signing a contract it is strongly advisable to engage the services of a qualified conveyancer to look of the contract and bring to your attention any areas which you may not have been aware of, explain your duties and obligations. Without this advice you as a purchases may find yourself in a very difficult predicament which could have been avoided.