Our Opinion: The New REINZ Agreement for Sale and Purchase of Property
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Articles by Matthew Gilligan
You may have read in the National Business Review or elsewhere that the Real Estate Institute of New Zealand is proposing to launch a new agreement for buying and selling property in New Zealand.
We understand that the agreement will be made available to real estate agents in New Zealand for use over the forthcoming months.
For over twenty years, the buying or selling of property in New Zealand has been recorded using a standard agreement produced jointly by Auckland District Law Society and the Real Estate Institute of New Zealand. The agreement is now in its 8th edition having been improved over the intervening years to take account of changes in the way in which property is bought and sold in New Zealand and to take account of changes in the law over that time.
The ADLS/REINZ 8th edition Agreement is tried and tested. It has been the subject of many court cases in which its provisions have been scrutinised and upheld. It has been taught in our law schools and been the subject of much academic commentary.
The ADLS/REINZ 8th edition Agreement has a proven track record, its provisions are easily understood and it helpfully regulates the way in which practitioners deal with each other and third parties through the course of a sale or purchase of land. It is a “no surprises” agreement.
On the other hand the new REINZ agreement introduces new concepts, rules of interpretation and time frames which may be unexpected, particularly if you have previously bought and sold property using the ADLS/REINZ 8th edition Agreement.
So, if you are planning to either buy or sell property in the near future, please contact us for advice prior to signing any agreement.
In most situations, we will advise the continued use of the ADLS/REINZ 8th edition Agreement until such time as the provisions of the REINZ agreement become well known, judicially interpreted and well settled. This may take a considerable period of time.
Don't be persuaded to use the plain English format of the new agreement. Plain English wording can be just as problematic as complex legal wording, particularly where the agreement has not had the benefit of many years of use.
Remember that all agents have access to both forms of agreement so this should not present any difficulty or delay in the buying and selling process.
Please contact our team if you have any further queries about this letter or you require any further detailed information.
Thank you,
Matthew Gilligan
Managing Director and Property Services Partner
© Gilligan Rowe & Associates LP
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Disclaimer: This article is intended to provide only a summary of the issues associated with the topics covered. It does not purport to be comprehensive nor to provide specific advice. No person should act in reliance on any statement contained within this article without first obtaining specific professional advice. If you require any further information or advice on any matter covered within this article, please contact the author.
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