Foreign investment review board

The Buyers need FIRB approval.  If the Buyers don't have FIRB approval by 5.00pm on ___/___/___ then the Buyers can give notice to the Sellers cancelling this Contract. The Standard Conditions are varied accordingly.

(NOTES: To determine whether Buyers need FIRB approval - simply ring the FIRB and explain the circumstances. They will give you the answer over the telephone. Don’t have their number ? Dial 1223  and ask for the “Foreign Investment Review Board” in Canberra. FIRB is a division of treasury.)

Solicitors

If the Buyers receive written advice from their solicitors that the terms of this contract are not approved by those solicitors, before 5.00pm on ___/___/___, then the Buyers can cancel this contract before that time by giving written notice (with  a copy of the solicitor's written advice) to the Sellers.

(NOTES: Often a "solicitor's approval" clause is very wide … and can lead to the contract being cancelled for any reason at all.  This clause is weighted slightly more in favour of the Sellers - because there has to be advice in writing from the lawyers, and a copy of that advice needs to be given to the Sellers.)

Others (eg family)

The Buyers wish to seek approval of this contract (and the Property) from  _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _.  The Buyers can cancel this contract in writing at any time up to 5.00pm on ___/___/___, if the Buyers are not satisfied (at the Buyers' discretion) that the approvals have been obtained.

(NOTES: Sellers should be reluctant to agree to a clause like this - because family members often consider it their obligation to find faults with something being purchased.)

Development approval (version #1 - 'easy' on developer)

This Contract is conditional on the Buyer obtaining approvals from the Local Government and the following conditions apply:

(a) Approval(s) This Contract is conditional on the Buyer obtaining approvals (to the Buyer’s absolute satisfaction) from the Local Government for: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ (the “Approvals”).

(b) Application within 45 days The Buyer must apply to the Local Government for the Approvals within 45 days of signing this Contract.

(c) Seller to sign documents If the Local Government requires documents to be signed by the Sellers, the Sellers must sign and return them to the Buyer within 7 days of receiving them.

(d) No approvals / Bad approvals If:

(i) in the Buyer’s opinion, it becomes obvious that the Local Government will not grant the Approvals to the Buyer’s satisfaction, or

(ii) the Local Government gives approvals and the Buyer is not satisfied (at the Buyer’s discretion) with those approvals,

     then the Buyer may give written notice (to the Sellers) cancelling this Contract.

(e) Settlement on Notice of Approvals Immediately on receipt of notice of satisfactory Approvals, the Buyer shall give written notice of same to the Sellers, and settlement shall occur on the 14th day after the Sellers receive that notice.

(f) Deadline If Settlement of this Contract does not occur within ______ months from the date of this Contract - then this Contract shall be at an end.

(g) Deposit Without affecting any other provisions of this Contract, if this Contract is cancelled by paragraph (d) or (f) then the deposit shall be refunded to the Buyer.

(NOTES: Developers often want clauses favouring only them. Drafting ‘developer’ clauses is always a balancing act between the interests of the Sellers, and the interests of the Developer. This clause is weighted very more towards the Developer.)

Development approval (version #2 - 'hard' on developer)

This Contract is conditional on the Buyer obtaining approvals from the Local Government and the following conditions apply:

(a) Approval(s) This Contract is conditional on the Buyer obtaining approvals (to the buyer’s absolute satisfaction) from the Local Government for: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _(the “Approvals”).

(b) Application within 30 days The Buyer must apply to the Local Government for the Approvals within 30 days of signing this Contract.

(c) Seller to sign documents If the Local Government requires documents to be signed by the Sellers, the Sellers must sign and return them to the Buyer within 7 days of receiving them.

(d) Copies of documents to Seller The Sellers may at any reasonable time (including after cancellation of this Contract) request the Buyer to provide copies of approval or rejection documents received by the Buyer from the Local Government.

(e) Progress reports to Seller The Buyer must provide written reports to the Sellers twice each month (on the 15^th of the month, and the 28^th of the month) and these reports shall:

(i) attach copies of applications to Local Government, or documents provided to the Local Government, or correspondence with the Local Government, or correspondence with surveyors or architects or builders; and

(ii) describe in the Buyer’s view (in no less than 60 words), the Buyer’s progress to date in seeking the Approvals.

     If the Buyer does not provide a report by the due date (or the next working day, if the due date falls on a weekend) then the Sellers can give the Buyer written notice cancelling this Contract.

 (f) No approvals / Bad approvals If:

(i) in the Buyer’s opinion, it becomes obvious that the Local Government will not grant the Approvals to the Buyer’s satisfaction, or

(ii) the Local Government gives approvals and the Buyer is not satisfied (at the Buyer’s discretion) with those approvals,

      then the Buyer may give written notice cancelling this Contract.

(g) Settlement on Notice of Approvals Immediately on receipt of notice of satisfactory approvals, the Buyer shall give written notice of same to the Sellers, and settlement shall occur on the 14th day after the Sellers receives that notice.

(h) Deadline If Settlement of this Contract does not occur within ______ months from the date of this Contract - then this Contract shall be at an end.

(i) Deposit Without affecting any other provisions of this Contract if this Contract is cancelled by paragraph (f) or (h) then the deposit shall be refunded to the Buyer, if this Contract is cancelled by paragraph (e) then the deposit shall be forfeited to the Sellers.

(NOTES: This clause is much tougher on a Developer. It makes the Developer very accountable, with the sanction of contract cancellation and deposit loss, in certain events.)

Buying two properties at once (eg accumulating a site)

The Buyer need also to contract to buy the property at: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _  for $_ _ _ _ _ _ _ _ _ _ (or less) by ___/___/___  and then settle that purchase on the same day as this contract settles.  If these things do not happen by their due dates, the Buyer may give notice to the Sellers cancelling this contract.

(NOTES: Sometimes buyers want to buy two properties at the same time - for example, properties side by side. This clause is designed to ensure that the Buyer only has to settle, if both contracts settle at the same time.)