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"My client bought a property in NSW at auction last Saturday. They now want to pull out because the building inspection revealed serious structural issues. The seller says there's no cooling off period for auction purchases. Can my client get out of the contract?"
Whether a purchaser at auction in NSW is entitled to a cooling off period or any right of rescission due to defects discovered post-exchange.
Under s 66J of the Conveyancing Act 1919 (NSW), a 5 business day cooling off period applies to residential property contracts. However, s 66K(1) provides that the cooling off period does not apply to contracts made at or in consequence of a public auction. The Australian Consumer Law (Sch 2, Competition and Consumer Act 2010 (Cth)) may apply if misleading conduct is established...
The property was purchased at auction, therefore s 66K(1) excludes the cooling off period. The contract is binding from the fall of the hammer. However, if the vendor made representations about the property's condition...
The purchaser has no statutory right of rescission under the cooling off provisions. Alternative remedies may include...
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