Implied Warranties in Body Corporate Sales Explained

What implied warranties does the BCCM Act require a Seller to give about the body corporate?

The BCCM Act contains certain implied warranties that the Seller is deemed to have given, such as the absence of:

1. any patent or latent defects in the common property or body corporate assets (for example, substantial building defects that require repair which can include common boundary walls of the lot or exclusive use areas and may include repairs required as a result of issues such as concrete cancer, structural or water issues and rectification works required because of the use of combustible cladding on the building);
2. any actual or contingent or expected liabilities of the body corporate not part of the body corporate’s normal operating expenses (for example, significant debts or judgments or other liabilities that may result or have resulted in the levying of a special contribution); and
3. anything else regarding the body corporate’s affairs which may affect you.

What rights do I have if the Seller breaches any of the implied warranties under the BCCM Act?

If any of the above exist and are not disclosed before entering into the Contract, the Buyer may have a right to terminate up until 14 days after the Contract Date. The right of termination given under the BCCMA does not limit a Buyers rights in relation to a breach of warranty and, if a Buyer does not exercise that right and proceeds to settle the Contract, they may have a right to pursue the Seller for compensation for any loss as a result of the breach of warranty. However the costs and uncertainty of litigation to recover any damages means it may be better to terminate or re-negotiate with the Seller during this 14 day period.