Volume is not protection.
Hundreds of pages of Body Corporate records are being ordered in Queensland property sales that are completely unnecessary, and the seller is footing the bill. Here is what the law actually requires, and why "refer to attached Form 33/34" is not a legal answer.
- Topic
- Statutory warranties
- Applies to
- Body Corporate sales
- Relevant to
- Agents · Sellers · Solicitors
- Jurisdiction
- Queensland
A costly habit, and a legal gap
A troubling practice has taken hold across Queensland real estate. Agents are routinely ordering hundreds of pages of Body Corporate records, including financial statements, meeting minutes and correspondence files, and attaching them to a contract as supposed evidence of statutory warranty compliance. On the face of it, this looks thorough. In practice, it is legally insufficient and commercially wasteful.
The instruction most commonly seen in contracts reads "refer to attached Form 2" or "refer to attached Form 33/34". Both directions are wrong. Neither satisfies the statutory warranty requirements under Queensland property law. Buyers and sellers are accepting this, and neither party realises what they are actually agreeing to.
The core problem
The statutory warranty items (a) through (g) in a Contract of Sale must be individually completed. They cannot be satisfied by attaching a Form 2, a Form 33/34, or any volume of Body Corporate records in their place.
"Refer to attached" is not a legal answer. It is a gap in the contract. Bulk records do not answer the warranty questions. They transfer the burden of reading, interpreting and concluding onto the buyer, which is precisely what the statutory warranty regime was designed to prevent.
What the law actually requires
When a lot in a community titles scheme is sold, the contract asks the seller to give the buyer notice of seven matters about the Body Corporate. These are warranties and contract obligations, not general disclosure. A blank answer, or "refer to disclosure statement", can give the buyer a right to terminate or claim damages. Each one, as it is put to the seller:
- (a)
Latent or patent defects in common property or Body Corporate assets
You know of no hidden or visible defects in the common property or Body Corporate assets, other than fair wear and tear, and the records show none.
- (b)
Actual, contingent or expected liabilities of the Body Corporate
You know of no Body Corporate liabilities beyond normal running costs, such as special levies or major works, and the records show none.
- (c)
Circumstances in relation to the affairs of the Body Corporate
You know of nothing in the Body Corporate's affairs likely to materially prejudice the buyer, such as a dispute or an administrator being appointed.
- (d)
Proposal to record a new community management statement (CMS)
You have had no notice of a meeting, and know of no resolution, to record a new community management statement.
- (e)
Unapproved improvements on common property benefiting the lot
Every improvement on common property that benefits your lot, such as a pergola or an air-conditioning condenser, has Body Corporate approval.
- (f)
Outstanding by-law contravention notices
You have no by-law contravention notice for your lot that is still in effect or not fully complied with.
- (g)
Proposed Body Corporate resolutions
Until settlement, you pass on to the buyer every notice of a proposed Body Corporate meeting and every resolution passed.
Each of these items demands a specific, accurate answer, not a document dump that leaves the buyer to draw their own conclusions. A buyer who must read through hundreds of pages to work out whether a special levy has been voted on has not been given a warranty. They have been given a research task.
What a Form 33/34 and Form 2 actually are
A Form 33 (or Form 34 for a specified two-lot scheme) is a Body Corporate certificate, a point-in-time record of contributions, levies and certain financial matters. It is a useful document, but it is not a substitute for the statutory warranty declarations.
A Form 2 is the seller's disclosure statement. It has its own purpose and requirements. Directing a buyer to "refer to Form 2" as an answer to a warranty question answers nothing. It simply redirects the buyer to another document that itself has its own outstanding obligations.
Both documents are useful. Neither answers the warranties.
The real cost to sellers
Sellers are being charged for records packages they do not need, while simultaneously not receiving the targeted statutory warranty report they do need. The two outcomes combine badly: unnecessary cost, and inadequate compliance.
What agents are ordering
Full Body Corporate records, including minutes, financials and correspondence, often 200 to 400 pages, at significant cost to the seller, providing no additional legal protection and failing to satisfy the warranty requirements.
What is actually needed
A targeted Statutory Warranties Report that directly answers items (a) to (g), prepared by a qualified Body Corporate search agent. Precise, compliant, and a fraction of the cost of a full records package.
Attaching bulk records and directing a buyer to "refer to attached" does not reduce the seller's exposure. It may increase it. If a warranty item is not clearly addressed and a buyer later suffers loss, the adequacy of the answer will be scrutinised. Volume of paper is not evidence of compliance.
What sellers, and their agents, should ask for
Sellers, and the agents and solicitors advising them, should insist on a report that directly and specifically addresses each of the statutory warranty items. This is not a bulk document exercise. It is a targeted compliance task, and it should be treated as one.
A properly prepared Statutory Warranties Report will address items (a) through (g) individually, draw on current Body Corporate records, and present the answers in a form that can be incorporated directly into the contract. No guesswork for the buyer. No exposure gap for the seller. No unnecessary cost.
The bottom line
The law requires answers, not documentation. Items (a) to (g) must be completed specifically, accurately and individually. A Form 2 cross-reference is not an answer. A stack of meeting minutes is not an answer.
A properly prepared Statutory Warranties Report is.
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