What your section 32 vendor statement actually tells you

In Victoria, a seller must give you a vendor statement before you sign a contract to buy land. It is usually called a section 32, after section 32 of the Sale of Land Act 1962 (Vic). The statement is where the seller discloses the things about the property that you cannot see on an inspection, and it is often the difference between buying with confidence and inheriting a problem.

What the statement has to disclose.

The Sale of Land Act sets out a list of matters the seller must disclose. In practice the section 32 usually covers the following.

• Title details, including a copy of the title and plan, and any mortgages that must be discharged at settlement
• Easements, covenants and other restrictions that run with the land, and any that the seller is aware of
• Planning and zoning information for the land
• Outgoings such as council rates, water and owners corporation fees, and any owners corporation certificate for a unit or apartment
• Whether services such as electricity, gas, water, sewerage and telephone are connected
• Notices, orders or proposals from an authority that affect the land
• Any building work carried out in the last seven years that required an owner builder warranty or insurance

What we look for.

A tidy statement is not the same as a clean one. When we review a section 32 we are reading for the things that change what you are really buying: a carriageway easement across the backyard you were planning to build on, an owners corporation with a special levy on the horizon, a covenant that limits what you can construct, or a planning overlay that will shape any future permit. We also check that the title matches the property you inspected and that any mortgage will be discharged.

If something is missing or wrong.

The disclosure obligations matter because the Act gives a buyer rights where a statement is defective. If the seller has not complied with section 32, a buyer may be entitled to rescind the contract before settlement in certain circumstances. Those rights are technical and time sensitive, which is why a defect is far better caught before you sign than argued about later.

The practical takeaway.

Read the section 32 as carefully as you read the price. If anything is unclear, have it reviewed before you commit, because once you have signed, your options narrow quickly. A short review at the front of a purchase is usually the cheapest insurance in the whole transaction.