The topic of requisitions on title falls under property law.
In simple terms, “requisitions” means a formal or official request for something that is needed.
Before we set out to explore requisitions on title, let’s understand certain important terms that are relevant to this subject.
Under property law, this topic is related to ‘conveyancing’. Conveyancing refers to the transfer of the legal title of real property from one person to another.
During the transfer of the legal title of the property, the purchaser can make certain inquiries with the vendor about the ‘title of the property.’ These inquiries are termed as requisitions on title.
Categories of Requisitions
There are four main categories or types of requisitions: –
- Requisitions on Title
Requisitions on Title relate to all the dealings that may or may not be registered on the title deed. These can include things like whether there is an easement or covenants or related to other dealings like mortgages and caveats that are registered on the title but require removal on or before the purchase has been completed.
What are easements, covenants, mortgages and caveats?
- Easement: It refers to the right of way, that essentially allows another person to use your property for a specific purpose.
- Covenants: It refers to certain obligations that are imposed on the owner of the land.
- Mortgages: It refers to a loan that is used to purchase, or maintain a house, land or other property.
- Caveats: It is used to protect interests in the land, i.e., it acts as a “freeze” on the property in question, such that no one else can register dealings with that property.
2. Requisitions as to Property/ Requisitions as to Conveyancing
This may include inquiries about the buildings works and matters related to how the property will pass to the purchaser, including the documents that will be handed over during settlement. This can also include the time and place for settlement, and the proper execution of the documents that are to be handed over.
3. Requisitions in the Nature of General Enquiries
This includes any questions that are asked or requests that are made routinely. This could include information on how matters are dealt with on completion. Examples of this include any adjustments to be made, any additional documents to be handed over, and the existence of any statutory notices.
4. Requisitions in the Nature of Reminders
This form of requisition acts as a reminder to both parties that the terms of the contract need to be complied with. For instance, if the contract has specified ‘vacant possession,’ the property has to be vacant on completion of settlement, i.e., when the purchaser acquires the property. Similarly, if there are any mortgages, all mortgages must be discharged before the completion of settlement.
What is the purpose of requisitions on title?
The most important purpose of requisitions is to ask the vendor of the property for information and documents that may or may not have been included in the contract.
If these information/documents were not disclosed on the contract, or if any additional information was not discovered during the inspection of the property, a requisition on title can be made.
The types of information that was not disclosed/discovered can include a range of things like: –
- Whether there is an ongoing dispute with the neighbours regarding fences.
- Whether there is any matter that could potentially justify the making of a demolition order.
Nowadays, most of the information is generally disclosed by the vendor of property, as this is part of his duty. To provide information about any matter that affects the property is the primary responsibility of the vendor. However, there are usually some areas that are not included in the vendor’s duty of disclosure.
This information that is not disclosed is sought in the Requisitions on Title.
What if the vendor does not answer requisitions on title honestly?
It is an important requirement for the vendor to answer all requisitions on title honestly, and accurately (to the best of his knowledge).
If the vendor does not answer them honestly, there are certain consequences. This will be the case especially when the purchaser has relied on the false answer provided by the vendor and has consequently suffered a loss.
Sometimes false answers might be provided by the vendor even unintentionally. Even in these cases, the vendor can be sued for damages. In these cases, the vendor will be liable for negligent misstatement.
Additionally, under Section 183 Conveyancing Act 1919, if the vendor conceals information to ensure that the purchaser settles faster, then he/she might face certain criminal and civil charges. This can also be considered as a breach of consumer protection laws, as stated under the Australian Consumer Law.
If the vendor is unable to answer a requisition properly, or unwilling to do so, he/she might have the authority to cancel the contract. The vendor can cancel the contract only in cases where: –
- The vendor is acting on reasonable and logical grounds, and not based on some ulterior motive, or
- The purchaser has made a proper requisition.
If the vendor chooses to cancel the contract, he/she is required to give the purchaser a written notice of his/her intention to do so. According to Section 56 of the Conveyancing Act 1919, the vendor needs to give the purchaser a reasonable amount of time to waive the requisition if required.
Importance of Seeking Legal Advice
Property law can be tricky because if you are not careful, you can suffer great losses. In cases concerning property law, legal advice will help you save a lot of time and money.
If you are looking to get high-quality legal advice on how to make requisitions on titles, or other requisitions, please do not hesitate to contact our Property and Conveyancing experts at JB Solicitors.
Our team includes licensed conveyancers and industry experts, so you can rest assured that your issues will be addressed efficiently.
Contact JB Solicitors today to gain advice on requisitions on titles, and other property matters.