Agents beware: New contract termination possibilities sure to be exploited
Given that the contract preparation and presentation processes under new PAMDA have been greatly simplified, lawyers are soon likely to turn their attention to other areas of non-compliance when seeking termination opportunities on behalf of their buyer clients.
One opportunity screaming out to be used (or mis-used) in this way is under the Electronic Transactions (Queensland) Act 2001 (“ETA”).
Do you think PAMDA changes from 01/10/10 will save time & money?!
- Yes (67%)
- No (33%)
- the person to whom the information is required to be given consents; or
- at the time the information is given, it was reasonable to expect that it would be readily accessible to the recipient and usable by them.
Because the presentation of contract documents to a buyer by e-mail or fax is regulated by the PAMDA (a state law), the ETA applies and the parties must have agreed to communicate via electronic means. The consent should specify whether the agreement is in relation to faxes, e-mails or (preferably) both.
Note that the current editions of ADL’s residential contract (clause 35.1) specifies that notices can be sent by fax but requires the parties agreement, for them to be sent by e-mail. The REIQ version (clause 10.4) also allows for notices to the given to the fax number of a party or their solicitor but makes no no reference to e-mails.
Agents must not regard these clauses as of themselves being a sufficient consent by a buyer to receive contract documents by fax for PAMDA presentation purposes.
Prior consent to communicate electronically remains a requirement. Consent within a clause of the “relevant contract” is not sufficient. Best Business Practice requires agents to have prior “written” consent to protect you and your client’s interests. One tool to overcome this hurdle is ADLForms’ “Electronic Transmission Consent” form.
The absence of a pre-contract ETA consent may well give parties the opportunity to unexpectedly terminate contracts.