Also known as a ‘Vendor’s Statement’, the Section 32 Statement is an important part of any real estate transaction. It’s a legal document given by the seller of a property to the interested purchaser. The name is derived from Section 32 of the ‘Sale of Land Act’ in Victoria. This government act requires a seller to provide specific information to a buyer about the property in question, before they sign the Contract of Sale.
The Vendor’s Statement is usually prepared by the seller’s conveyancer or solicitor. A seller may also choose to use a real estate agent to draft the Contract of Sale. These two documents are the most important on the seller’s side of the conveyancing process.
(A good real estate agent will have professional connections to conveyancers and conveyancing solicitors, you can compare real estate agents upfront at LocalAgentFinder and get the expert advice to help you sell your property.)
The Purpose of a Vendor’s Statement
This statement only goes by the name ‘Section 32’ in Victoria. It goes by different names in other States or Territories, because the statement is applicable under a different act and section. Despite the differences in name, the Vendor’s Statement typically contains the same sorts of information, including information gleaned from title, road and land tax searches, as well as encumbrances. The purpose of the statement is to fully disclose all pertinent information to the buyer before the final contract is signed.
The vendor must provide a signed Section 32 Statement before the buyer signs their contract, or the buyer will be able to pull out of the contract. While this is the general rule, there are always exceptions so buyers should consult with their solicitors or conveyancers rather than assuming that they will always be able to rescind the contract due to this technicality.
How long does a section 32 last?
The industry rule of thumb is that the section 32 vendor statement stays valid for three months, and then should be updated.
The Seller’s Responsibilities
A seller will also want to use a conveyancer or solicitor to prepare the Section 32 Statement. Although it’s possible to fill out this form on one’s own, we don’t recommended it as it is a legal document and should correspondingly be prepared by a legal entity or qualified solicitor. You may not know all of the legal responsibilities associated with the preparation of this statement, which could harm you in the future or jeopardise your sale. If false or misleading information is included in the Statement and it is determined that the vendor provided this knowingly or recklessly, you could be found guilty of a crime and fined.
The vendor, or their legal representative, must also sign the Section 32 Statement for it to be valid. The buyer will usually sign this form as well, but this is not legally required under the direction of the Sale of Land Act. Most selling agents will get buyers to sign the statement, however, because it can then be used as proof that the buyer received it before they signed the Contract of Sale. This may be useful should the issue arise during the conveyancing process.
As you can see, the Section 32 Statement is an important part of the conveyancing process. Whether you are a buyer or seller, you will want to have your solicitor or conveyancer take a close look at this document. Sellers will also want their real estate agent to be involved in this document’s preparation, particularly if they are also preparing the Contract of Sale.
You can compare local agents upfront at LocalAgentFinder, who will have professional connections to conveyancers and conveyancing solicitors to help you through the legal process of buying or selling your property.