What new traps for agents in PAMDA process after September?
After next month, PAMDA’s new chapter 11 will only allow termination on one ground – if a buyer proves they were not given a clear statement (a “direction drawing statement”) alerting them to the contract, the form 30C warning statement and the BCCM information sheet .
Termination rights will no longer automaticaly apply for failure to ensure the warning statement and the BCCM information sheet are attached to the contract at the time of signing and the time of return of the signed contract to the buyer.
Likewise there are no termination rights relating to the order in which documents are attached or presented.
Do you think PAMDA changes from 01/10/10 will save time & money?!
- Yes (67%)
- No (33%)
Here are the basics for you to follow:-
The new requirements scheduled to apply from 1 October will be:-
1) form 30C warning statement and BCCM 14 information sheet (if required) must be prepared if contract prepared by seller or seller’s agent. termination rights apply
2) form 30C warning statement must be in correct form ie contain specified information that is presented in substantially the same way as the in approved form. BCCM 14 information sheet (if required) must be in approved form. termination rights apply
3) form 30C warning statement and BCCM 14 (if required) must be “attached” securely when giving the contract to the prospective buyer for signing. offence provision only
4) no form 30C warning statement required where the buyer prepares the contract.
5) buyer must be given “direction drawing statement”: a clear statement drawing their attention to the contract, the form 30C warning statement and BCCM 14 information sheet (if required). termination rights apply
6) form 30C warning statement required if seller amends buyer-prepared contract and returns it as a counteroffer. offence provision only. Buyer must be given “direction drawing statement” in such circumstances. termination rights apply
7) no requirement for buyer to sign form 30C warning statement and BCCM 14 (if required) but if buyer signs it (or them if needed) before they sign contract and it (or they) is/are ‘atttached’, buyer can’t terminate as per 5 & 6. If more than buyer, only one need sign.
8) if the contract is sent to the buyer by e-mail, the warning statement and BCCM form 14 must be included in the same e-mail. offence provision only
9) if sending by fax, the documents must be sent in the same fax transmission or in more than one if sent at the same time.offence provision only
10) no new form 30C warning statement (or re-signing of the original) and no new “direction drawing statement ” required every time there is a counter-offer during negotiations e.g. over price or settlement date except:-
- if the parties change including if eg, a husband and wife or family company replace the husband as buyer;
- if the property description changes or (potentially) if nominated fixtures are added or deleted;
- potentially, if contract format is changed from a ‘form’ eg ADL or REIQ, to a ‘non-form’ format.
Termination rights apply to exceptions for failure to give “direction drawing statement”. Potential offence provision only regards absence of new warning statement or re-signing same.
11) form 30C warning statement and BCCM 14 information sheet (if applicable) must be attached to the eventual signed contract when it is returned to buyer. offence provision only
If buyer proves attention was not drawn to warning statement (and has not signed it) buyer can terminate prior to settlement but only within 90 days following their receipt of the signed contract from the seller. The period runs from the date of the buyer’s (or their soliciror’s) receipt of a copy of the signed contract. If a contract was sitting in the buyer’s P.O. Box for a week, the cooling off period is extended by that period.
The 5 business day cooling-off period runs from the date of the buyer’s (or solicitor’s) receipt of the signed contract but if received on a weekend or public holiday, from the next business day thereafter. It ends at 5 p.m. on the fifth business day.
If the buyer signs the contract after the seller (or initials to accept changes made by the seller), the buyer is taken to have received a copy of the contract when the buyer has both signed (or initialed changes) and communicated acceptance to the seller. In other cases, PAMDA does not specify when ‘receipt’ occurs. For this reason it is essential for sellers to have buyers sign a “Receipt Acknowledgement” specifying the date upon which they have received a copy of the signed contract.