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We’ve just exchanged contracts for sale of our strata apartment. The body corporate wants to hold a special meeting in 2 weeks to update the 10 year plan This may involve special levies for general property repair of common areas. I’m not sure where this leaves us because in submitting our contract we declared that no special levies were owing. I’d be grateful for advice on this. Thanks
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At the time you wrote the contract, there were no special levies to be raised.
As you say, the EGM in 2 weeks MAY raise special levies. There is no certainty there.
The buyer will ask for a section 184 certificate, which will disclose any and all levies due.
You have not erred in anyway.
The buyer may ask for a discount from you but you are under no obligation to give it, as at the time the contract was made you used the best information available.
If your sense of morals sit uncomfortably, you could give a discount, but you are not obliged to.
This is dealt with in the standard contract of sale. The way it works is that where a special levy is struck (as distinct from your usual levies) on or before the contract date, the vendor is liable for it. If the special levy is struck after the contract date, the purchaser is liable. Refer clause 23.6 of the standard contract.
A number of adjustments are made at settlement, such as council rates and regular strata levies. Check your contract of sale.
And just to clarify for those who are not clear.
The contract date is the date that the contracts are exchanged, usually close to the day the deposit is paid. You know its the contract date because the vendor and the purchaser sign the contract.
The settlement date occurs usually 42 days later and is when the final payment is made.