Wouldn’t it be annoying if you purchased a property and there were personal items and rubbish left behind from the previous owners? At who’s expense, when the rubbish is removed? You don’t have time to remove the items, especially when you can use that time to spend with your family and friends.
When purchasing a property, vacant possession is one of the requirements that many people look for, especially when their intention is to live in the property. One of the most common issues that arise for purchasers is the presence of rubbish and personal items, left on the property after settlement.
The word ‘settlement’ means the completion of the contract where the purchaser pays the full price of the property under the contract, and the owner gives to the purchaser the title of the property.
What is vacant possession?
Vacant possession refers to the exclusive use of the property, free from any tenancy or any physical impediment preventing the purchaser from enjoyment of the property. This requires the property to be:
- free of chattels such as furniture,
- any rubbish, or
- personal items.
The seller’s obligation
It is standard practice under every contract that the seller is obliged to provide vacant possession on completion. This obligation requires the seller, on or before completion of the contract (that is, on or before the day of settlement), to remove any items not included in the sale of the property.
The presence of furniture, rubbish or personal property on the land or in the house and the absence of removal after completion, indicates that vacant possession has not been provided and is a breach of the Contract.
Failure to give vacant possession
The removal of personal items may require external and additional assistance and be not only costly to the purchaser but the items may be hazardous. Before settlement takes place, any claim for removal of rubbish and personal items must be brought to the vendor’s attention, and settlement must be placed on hold until such a time that the rubbish is removed from the property.
It is important for purchasers to inspect a property just before settlement in order to ensure that no personal items are left on the premises, and no rubbish or undesired items are left behind.
The options available to a purchaser when vacant possession is not provided, include, but are not limited to:
- Refusing to settle and complete the Contract;
- Retain a percentage of the deposit to recover the costs of removal of unwanted items; and
- Commence legal proceedings to recover damages
Vacant possession does not necessarily mean completely empty, and in some circumstances the purchaser must show that there is an “impediment which substantially prevents or interferes with the enjoyment of the right of possession of a substantial part of the property”. The Court may decide that a significant number of personal items or rubbish, does not constitute failure by the vendor to provide vacant possession, and each case should be determined on its own merits.
It is recommended that a property is thoroughly inspected prior to entering into a contract.
If there are any items or circumstances which are of concern, the purchaser must raise those issues within the contract.
A purchaser should always inspect a property on the day of settlement to ensure that no surprises will be found after completing the contract and paying the full purchase price.