Planning changes affect land sale contracts

Recent changes to planning regulations mean that land sale contracts exchanged after 27 February 2009, with a council certificate obtained prior to this date, will provide purchasers with the option to rescind the contract without penalty before settlement.

S.149 certificates

Under the Conveyancing (Sale of Land) Regulation 2005, contracts for sale of land are required to include what is known as a Section 149 certificate.

Section 149 certificates come in two forms: section 149(2) and section 149(5). A section 149(2) certificate is issued by a local council under the Environmental Planning and Assessment Act (EP&A Act) and specifies the town planning controls and other legal constraints that apply to a parcel of land.

As of 27 February, the following advice must now be included on section 149(2) certificates:

Whether or not the land is land on which no complying development may be carried out under State Environmental Planning Policy (Exempt in Complying Development Codes) 2008 and, if no complying development may be carried out on that land under that policy, the reason why complying development may not be carried out on that land.

Land on which no complying development may be carried out is land that falls within any of the types of land described in clause 1.19 of the State Environmental Planning Policy Codes (SEPP Code). Each Council in NSW will have already reviewed all of the land within its area and identified all of those parcels that fall within any of the categories of land listed in clause 1.19.

Section 149 certificates issued prior to 27 February 2009 do not include this information and accordingly are insufficient to satisfy obligations under the Conveyancing (Sale of Land) Regulation 2005.

You are unable to contract out of the requirement that you provide a current section 149 certificate in the contract for sale. This means it is not possible to simply agree with the purchaser to use the existing certificate.

Complying developments

The SEPP Code identifies particular types of development as “complying development” under the EP&A Act and specifies particular types of land on which “complying development” cannot be carried out.

The SEPP Code also contains criteria that must be met in order for a development to qualify as a complying development.

The concept of “complying development” was first introduced in NSW by amendments to the EP&A Act in 1998. The policy underpinning the amendments was to allow development that was “non controversial”, and able to be assessed according to objective criteria, to be approved by a person other than the local council or the Minister for Planning.

Examples of the types of developments intended to be covered include single storey dwellings on land greater than 450 square meters, swimming pools, retaining walls and fences, which would be approved by accredited private certifiers.

A complying development is defined in section 76A(5) of the EP&A Act as a development, or a class of development, that:

• is identified in an “environmental planning instrument”
• can be addressed by specified predetermined development standards.

Complying development may only be carried out if:

• a complying development certificate (CDC) has been issued
• development is carried out in accordance with the certificate and any provision of an EPI.

Kells has two teams that work closely together on planning and property matters. For assistance with local government, planning and environment matters please contact our partner and Accredited Specialist Michael Mantei, and for commercial property matters, please contact our partner Paul Magagnino.