PROPERTY LAW ACT 1974 - SECT 68A Forfeiture of deposit on purchaser’s default

PROPERTY LAW ACT 1974 - SECT 68A

68A Forfeiture of deposit on purchaser’s default

(1) This section applies in relation to a contract for the sale of a proposed lot.

(2) The contract may provide for a sum not exceeding 20% of the purchase price of the proposed lot paid under the contract as a deposit (whether paid in 1 or more amounts) to be forfeited and retained by the vendor in the event of a breach of contract by the purchaser.

(3) However, the sum may only be forfeited or retained by the vendor if the breach results in the termination of the contract.

(4) It is declared, for this section, that a sum not exceeding 20% of the purchase price of the proposed lot that is paid under the contract as a deposit (whether paid in 1 or more amounts) is not, either at law or in equity, a penalty if the sum is forfeited and retained by the vendor because the contract is terminated following the purchaser’s breach of the contract.

(5) In this section—


"proposed lot" means—

(a) a proposed lot within the meaning of the Land Sales Act 1984; or

(b) a proposed lot within the meaning of the Body Corporate and Community Management Act 1997; or

(c) land that will be shown as a lot on a building units plan or group titles plan registered under the Building Units and Group Titles Act 1980 ; or

Note—

There is limited scope for the registration of new building units plans and group titles plans under the Building Units and Group Titles Act 1980 —see section 5A of that Act.

(d) a proposed lot within the meaning of the South Bank Corporation Act 1989 , section 97B .