What is the Sunset Clause in Victoria?

In Victoria, a sunset clause in an off-the-plan property contract allows a developer to terminate the contract if certain conditions, like the registration of a plan of subdivision or the issue of an occupancy permit, are not met by a specified date.

Recent legislation aims to protect buyers from developers misusing sunset clauses to rescind contracts and resell properties at higher prices.

Key Aspects of Sunset Clauses in Victoria

Vendor’s Obligations:

If a developer wants to rescind a contract under a sunset clause, they must obtain the buyer’s written consent or seek a court order.

Court Oversight:

The Supreme Court can allow a developer to terminate a contract under a sunset clause if it’s considered just and equitable, taking into account factors like the developer’s conduct and the impact on the buyer.

Sunset Date:

The sunset date is a significant deadline in the contract, allowing buyers to terminate the contract and recover their deposit if the project isn’t completed by that date.

Please don’t hesitate to contact Glenferrie Conveyancing on (03) 9815 2351 for more information about sunset clauses.