Material Facts and the Sale of Land Amendment Act

From 1 March 2020, the Sale of Land Amendment Act 2019 came into effect. One of the main changes that it dealt with are “material facts” relevant to the sale of real estate within Victoria.

A material fact is a fact that a proposed purchaser ought to be made of aware of by a vendor or the vendor’s selling agent that could impact them in their decision to purchase.

Prior to the changes described above, it was an offence if the Vendor or Vendor’s agent “fraudulently” withheld the information from the Purchaser. The word “fraudulently” has now been replaced with the word “knowingly”. The difference is that the word fraudulently imports deceitfulness and would be difficult to prove in court. Whereas “knowingly” does not require deceitfulness; it just requires that the Vendor or Vendors selling agent knew or ought to have of known that the information being withheld could be misleading or deceptive.

Examples of Material Facts:

Some examples of Material Facts include:

  • A current pest infestation at the property
  • A homicide has been committed at the property previously
  • The property has been used to manufacture nefarious drugs such as methylamphetamine
  • Illegal building works

Failure to Disclose Material Fact

If there has been a failure to disclose a material fact by the Vendor, the purchaser may be able to claim a material breach of the Contract of Sale and withdraw from a Contract of Sale.

Furthermore, the Vendor or Vendors Selling Agent could face up to 12 months’ imprisonment or a fine of up to 120 penalty units.

How to disclose:

We suggest that material facts be disclosed in marketing material with the estate agent, in the vendor statement (Section 32 statement) or contract of sale. Material facts must be disclosed before a contract of sale is signed.

At Phillips & Wilkins, if you are selling a property, we provide you with a comprehensive questionnaire in order to identify common material facts. If you would like to discuss Material Facts further, please do not hesitate to contact me.

Chris Henderson

Chris Henderson

At Phillips & Wilkins, Chris practices in the areas of Property Law, Conveyancing and Family Law. Chris has grown up in the Northern Suburbs and continues to be a part of the local community as being a member of the Old Paradians Amateur Football Club and the Mill Park Cricket Club. Learn more about Chris' legal experience.