CLAUSE

DESCRIPTION

Vendor warranties

7.3(1)

The updated clause requires vendors to warrant that, at settlement, any ‘automatic garage door facilities’ are delivered to the purchaser in reasonable working order. The definition of ‘automatic garage door facility’ has been updated to cover the entire opening mechanism and remotes.

7.3(5)(b)-(c)

Under the new clause, where a vendor has carried out any "restricted building works" under the Building Act 2004 on or after 13 March 2012, they must warrant that these were carried out and supervised by appropriately qualified persons, effectively requiring the vendor to warrant compliance with all relevant exemption requirements. Clause 7.3(5)(c) requires a warranty that any building works requiring permits or consents (noting that not all works require a building consent) have been completed in full compliance with those requirements.

8.4

Regarding the Unit Titles Act 2010, the vendor now warrants that they have not voted, without the purchaser’s written consent, on matters that would alter the warranties. This recognises that a vendor typically has only one vote and cannot control entire body corporate decisions, though it serves as a reminder for purchasers to conduct thorough pre-settlement checks on longer settlements.

Finance condition

9.1

If a purchaser cannot obtain finance, they must now provide a “reasonable” explanation of the “steps taken” to secure it. This replaces the previous requirement for a "satisfactory" explanation of the "grounds relied upon," emphasising that a purchaser must make a genuine, documented attempt to obtain funding while recognising that the finance condition involves purchaser discretion.

Overseas Investment Act consent condition

9.6

This clause has been updated to require the vendor to take "reasonable steps" to assist the purchaser in fulfilling the Overseas Investment Act 2005 (“OIA”) consent condition. This is a shift from the previous wording, which stated the vendor had no obligation to take any action regarding the purchaser’s OIA consent application.

Survey Plan

9.9

The principal amendment to clause 9.9 clarifies that once a survey plan has been deposited, the conditions prescribed by section 225 of the Resource Management Act 1991 are deemed satisfied by both parties. Section 225 operates as a protective mechanism, ensuring that a purchaser is not left bound by an agreement where title to the relevant property has not yet been issued. This scenario arises most commonly in land and build contracts, where the creation of a new certificate of title is a prerequisite to settlement.

The section 225 statutory cooling-off period of 14 days may effectively be curtailed where a survey plan is deposited shortly after an agreement has been executed. Purchasers and their advisers should therefore be aware of this possibility, as the window within which a purchaser may exercise their right to cancel under section 225 could be considerably shorter than anticipated.

Claims for compensation

10.3

Any party making a compensation claim must now serve notice as early as is "reasonably practicable." While a claim may still take time to fully quantify, flagging the issue early prevents last-minute disruptions. The previous limit on the number of claims has been removed.

10.13

Clause 10.13 now clarifies that “where the appointee is determined by the president, the president shall not be liable to either party for any costs or losses that either party may claim to have suffered in respect of that determination”. Supporting this is a broadened definition of an "Appointee" (clause 1(4)), which now includes experienced property lawyers, litigators, an expert committee, or, where suitable, a valuer or quantity surveyor.

Schedules

1

Schedule 1 now prompts vendors to clearly indicate if the property is their principal place of residence and whether any part of the supply is a taxable supply. This is intended to minimise misunderstandings that could materially affect settlement figures and invoicing.

2

Schedule 2 has modernised its chattels list to align with contemporary terminology, replacing "burglar alarm" with "security alarm" and using "window coverings" as a broader category. It also expressly includes items such as heat pumps, bathroom extractor fans, and automatic garage door facilities.

3

Schedule 3 now includes a section added to accommodate additional pet bonds where they are permitted by the Residential Tenancies Act 1986. Parties must ensure that these arrangements are recorded consistently across both sale and tenancy documentation.