How should a corporation sign a PAMD Form 30c and a residential contract under the Property Agents & Motor Dealers Act 2000 (Qld)?

Published Friday, 21 July 2006 by Annette Greenhow

In the recent decision of Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd delivered on 8 June 2006, the Queensland District Court considered the strict requirements governing the execution and dating of contracts under the Property Agents and Motor Dealers Act 2000 (Qld (the Act) and the distinction that arises between the signing of such documents by corporations and individuals.

In this case, the plaintiff purchaser, Glenlyon Developments Pty Ltd (Glenlyon), sought to avoid a contract dated 31 March 2003 for the purchase of a residential property on the grounds that both directors of Glenlyon had failed to execute and date the Form 30c warning statement in compliance with section 366 of the Act (as it then was).

Section 366 of the Act, at the time, required that a contract for the purchase of a residential property must have attached, as its first or top sheet, a statement containing specific warnings to the purchaser. For it to be effective, the warning statement must be signed and dated by the purchaser before the contract is signed. Failure to execute the document as required entitled the purchaser to terminate the contract.

The purpose of the provision is to ensure that the warning statement is brought to the attention of the purchaser prior to the execution of the contract, and is in keeping with the overall objective of the Act to provide consumer protection for the purchase of residential property. The provision allows a purchaser the opportunity to terminate a contract for a technical breach of the Act, even though the purchaser may not have suffered any material disadvantage.

In this instance the contract was forwarded to Glenlyon in the correct format. The first director of Glenlyon signed, but did not date the Form 30c warning statement then signed the contract. The contract was then forwarded to the Defendant seller, who signed the contract. The contract was later forwarded to the second director of Glenlyon, who signed and dated the Form 30c warning statement, and then signed the contract.

For Glenlyon to validly execute the document without the common seal, the Corporations Act 2001 (Cth) required both directors to sign the documents. Glenlyon later sought to terminate the contract on the grounds of non-compliance with s. 366 of the Act, specifically because of the failure by the first and second directors to sign the warning statement before they signed the contract, and the failure by the first director to date the Form 30c warning statement.

The Court, in denying Glenlyon’s Application for Summary Judgment, found that not every signatory of a corporation was required to date the document.

The Judge found that the position of a corporate purchaser was not analogous to that of more than one individual purchaser and held that there were not two buyers, but one. The Judge considered that the “apparent purpose of requiring a date to be inserted is to aid any subsequent determination whether the warning statement was signed before the contract. That purpose is not advanced by requiring the date to appear twice, when a corporation is signing”.

This case illustrates the care that needs to be taken by sellers and their agents to ensure that the required parties sign the Form 30c warning statement and proposed contract in the correct order, and in compliance with the Act.