Place Of Settlement

When using the standard REIQ Contract can the Seller insist that the place of settlement be the office of the solicitor for the seller even though not in Brisbane CBD.

The place for settlement in this regard is referred to in the Item Schedule under the special conditions page and is usually inserted by the parties.  In the REIQ Contract prior to 7th edition the reference to settlement date in the special conditions page of the REIQ Contract did not have any reference to what this term meant.  Accordingly, at that time the parties then relied upon clause 5.1(2) which provided that “If the parties do not agree on where settlement is to occur it must take place in the place for settlement at the office of the solicitor or financial institution nominated by the Seller…”  In this regard it is then clear the parties had agreed that the settlement would take place at the place for settlement at the office of the solicitor.  If a reference to Brisbane was made the reference to Brisbane not only included the CBD but also incorporated the greater Brisbane area.  Accordingly, a suburban solicitor could enforce settlement to occur at his office.

The 8th edition of the standard REIQ Contract now provides in the Reference Schedule Special Conditions page that “a reference to Brisbane is a reference to the Brisbane CBD”.  Does this then mean that the settlement must occur in the Brisbane CBD if Brisbane is identified as the place of settlement.  The wording of clause 5.1(2) has not changed.  The clause provides that “settlement must take place in the place for settlement at the office of a solicitor … nominated by the Seller …”  This clearly makes a reference to the words “place for settlement”.  “Place for settlement” is not defined in the terms of Contract and is only identified in the reference schedule under the Special Conditions page.

Clause 1.1(1) of the Contract provides that the terms in bold in the Reference Schedule have the meanings shown opposite them.  Accordingly, the word Brisbane is a reference to the Brisbane CBD.  Accordingly, by virtue of clause 1.1(1) when “place for settlement” refers to Brisbane it is defined as being the Brisbane CBD.  Therefore the parties have agreed that the settlement must take place in the Brisbane CBD at the office of a solicitor nominated by the Seller.

Does this then mean that the Seller must nominate a solicitor at the place for settlement or does this mean it must take place at the Seller’s solicitor who may or may not be in the Brisbane CBD.

The inclusion of the words “in the place for settlement at the office of the solicitor nominated by the Seller” in its entirety must mean that it must be at a place in the place for settlement (which if Brisbane is the Brisbane CBD) and at the office of a solicitor nominated by the Seller in that place for settlement namely the Brisbane CBD.

If the parties had intended that it would take place at the Seller’s solicitor’s office acting for the Seller in the transaction then clearly the Seller would not have agreed to use of the words “place for settlement” or would have changed the wording so that the place would be simply the Seller’s solicitor’s office closest to or near the place for settlement.  The circumstance that the parties have agreed to the settlement taking place in the place for settlement at the office of a solicitor suggests that the Seller if he does not have a solicitor in the place of settlement must then nominate a solicitor in the place for settlement for settlement to occur.  Accordingly, if Brisbane is inserted the Seller must then instruct a solicitor in the Brisbane CBD or in the alternative, arrange for settlement to occur at the Land Registry office in Brisbane.

To overcome this issue the Seller must insert other words apart from Brisbane.  Words such as Brisbane Metropolitan Area or Greater Brisbane Area or Brisbane Suburbs would be appropriate.

 

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