New obligations for vendors and purchasers of properties with swimming pools and spas
A recent Office of Local Government Circular (Circular No 16-05, 11 March 2016) (‘Circular‘) has advised that new regulations which will commence on 29 April 2016 to the effect that backyard pools which do not comply with the Swimming Pools Act 1992 (‘Act’) can be identified at the time of sale and new owners will have to rectify the non-compliance within three months in order to avoid penalties under the Act.
Previously changes were made to the Swimming Pools Regulation 2008, Conveyancing (Sale of Land) Regulation 2010 and Residential Tenancies Regulation 2010 (collectively ‘Regulations‘) to require properties sold or leased after 29 April 2016 to have a valid certificate of compliance under the Act or a relevant occupation certificate. Our earlier articles on this topic are linked here and here.
The Office of Local Government has advised that further changes to the Regulations are proposed. In totality, it is proposed that on and from 29 April 2016:
- All properties with a swimming pool or spa pool being sold or leased must have a valid certificate of compliance, certificate of non-compliance or a relevant occupation certificate (issued under the Environmental Planning and Assessment Act 1979 that is less than 3 years old and that authorises the use of the swimming pool). These documents will be prescribed documents that must be included in a contract for sale under section 52A of the Conveyancing Act 1919,
- A vendor selling a property that has a non-compliant pool can transfer the requirement to have a compliant pool to the purchaser. A certificate of non-compliance must be attached to a contract for sale,
- A purchaser who buys a property with a non-compliant pool has 90 days from the date of settlement to address any issues of non-compliance (unless the certificate of non-compliance states that the swimming pool poses a significant risk to public safety). If they are not addressed within that period the new property owner will be subject to penalties under the Act,
- All leased properties with swimming pools must have a certificate of compliance or an occupation certificate and these must be produced to the tenant under the Residential Tenancies Regulation 2010,
- Certain properties that have two or more dwellings will be exempt from the new requirement to provide a compliant pool on sale or lease of the property as they are already regulated by mandatory three (3) year inspection programs.
Currently, the Standard Form Lease provided in Schedule 1 of the Residential Tenancies Regulation 2010 includes a clause that requires a certificate of compliance or an occupation certificate to be provided to the tenant at the time that a property with swimming pool is leased. The clause does not operate until 29 April 2016.
Since the issue of the Circular, the Swimming Pools Amendment (Inspections) Regulation 2016 came into force on 24 March 2016. This regulation amends the Swimming Pools Regulation 2008 so that it deals with certificates of non-compliance and the 90 day compliance period for new property owners as referred to in paragraphs 3 and 4 above.
A new clause 18BB provides that the obligation upon owners to address any issues of non-compliance within 90 days only arises if the contract for sale includes a certificate of non-compliance. Accordingly, this clause will not apply until the Conveyancing (Sale of Land) Regulation 2010 is updated (on or before 29 April 2016).
Councils can expect an increase in requests for swimming pool compliance inspections from vendors preparing contracts for sale, and from purchasers who will be under pressure to organise inspections and to rectify defects listed in the certificate of non-compliance within the 90 day time limit.
The Minister for Local Government expects that if a contract for sale attaches a certificate of non-compliance, homebuyers will be able to negotiate a purchase price that takes into account the costs of making a swimming pool compliant.
By allowing the transfer of obligation for swimming pool compliance to a new property owner, the changes to the regulations will provide greater flexibility in the sales process. More importantly, the changes will ensure that incidents of non-compliance are addressed.
This article has been prepared by Amanda Berry and Sue Puckeridge.
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