Often if there is an agent acting for the vendor the agent will prepare the Form 1.
Some agents contract out the task of preparation of a Form 1 to a conveyancer and there are some conveyancing practices that specialise in the preparation of Form 1’s.
If a vendor is not using an agent to sell their property their conveyancer will prepare the contract and the Form 1.
So what is the Form 1?
The Form 1 is a formal statement made by the vendor pursuant to section 7 of the Land and Business (Sale and Conveyancing) Act1994 (SA). This form sets out the cooling off rights of the purchaser and important information about the property. For example, certificate of title details, mortgages on the property, zoning, easements and encumbrances on the title.
The agent must certify that the statement is complete and accurate.
What is in the Form 1?
The Form 1 comprises:
- an introductory statement setting out the purpose of the form
- details of the parties and the land
- details of cooling-off rights
- a statement by/on behalf of the vendor
- a certificate by/on behalf of the agent verifying the particulars in relation to the land appearing in the statement
- a table of particulars in relation to mortgages, charges and prescribed encumbrances affecting the property
- parts detailing particulars in relation to prescribed matters affecting the property
The Form 1 can be prepared by the land agent selling a property or this task may be outsourced to a conveyancer. In fact, there are some conveyancers whose working consists solely of creating Form 1’s.
The Form1 Chart:
The following charts explains some of the ‘prescribed encumbrances’, details of which must be listed in the Form 1.
|Easement||An easement is a right to use land e.g. the right of an owner of land to pass over neighbouring land to access his/her land. If an easement is registered over the land, a copy of the document creating the easement should be obtained and carefully read (if it is not already attached to the Form 1).|
|Restrictive covenant||A restrictive covenant is a limitation on the use of the land e.g. a prohibition on the construction of multi-storey dwellings or on lopping down trees. If an encumbrance is registered over the land then a copy of the document creating it should be obtained and carefully read (if it is not already attached to the Form 1).|
|Lease, agreement for lease, tenancy agreement or licence||This Item requires the disclosure of rights to occupy the land. Note that the Form 1 does not provide for the disclosure of any sublease or subtenancy information.|
|Development Act Items||
These Items require the vendor to disclose various information in relation to the Development Act 1993 (SA) (and associated legislation, including repealed Acts) e.g. the vendor should disclose any building approvals, any current insurance policy issued to an owner-builder or any land management agreement entered into with the local council.
Note, the planning and development system in South is currently undergoing a major overhaul with the enactment of the Planning, Development and Infrastructure Act 2016 (SA). The Form 1 still makes reference to the Development Act 1993 (SA).
|Heritage matters||This is the section for disclosure of restrictions on the development of the land. Sometimes they are not noted on the title and thus require further investigation. Purchasers should be aware that there may be restrictions on building and external alterations.|
|Particulars of transactions in the last 12 months||This section of the Form 1 is frequently overlooked and the details of the previous owner(s) should be supplied. Sometimes the transfer may not have been registered and therefore a simple search of the Lands Titles Office will not reveal the information that is sought; the vendor will need to provide that information.
* Note that this section extends beyond purchases of land. It includes, for example, transfers pursuant to matrimonial settlements.
|Strata matters||This section provides for the disclosure of information relating to a unit’s strata corporation, strata fees, etc. Even if a unit is self-managed, there is certain information that should be supplied i.e. a Certificate of Currency for insurance and a copy of the strata plan. An astute purchaser should inquire as to any levies that are in arrears.|
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