CLIENT ALERT: WHAT YOUR BUSINESS NEEDS TO KNOW ABOUT THE UPCOMING CHANGES TO PROPERTY LAW

The Property Law Act 2023 is set to take effect on 1 August 2025 in Queensland, Australia. It introduces substantial changes to property law such as replacing the Property Law Act 1974, impacting disclosure policies, leasing provisions, easement covenants and limitation periods. These changes aim to improve transparency, address tenant protection concerns, and improve fairness and efficiency in lease management.

WHAT IS NEW UNDER THE CHANGES?

The changes will affect multiple areas, including lessor consent processes, release on assignment, covenant enforceability and notice to remedy breach.

The key updates include:

1. Mandatory Seller’s Disclosure Requirements

Expanded Seller Disclosure Obligations: Sellers will now be required to disclose detailed property information to buyers, including legal, environmental, and building issues. This will help improve buyer confidence and reduce potential disputes post-sale.

Under the new disclosure requirements, sellers must provide comprehensive information about the property to prospective buyers. This includes the title and plan details, as well as any registered or unregistered encumbrances. If the property is subject to a residential tenancy agreement, that must be disclosed, along with applicable zoning information. Sellers are also required to disclose any government-issued notices relating to transport infrastructure proposals that may impact the property, and whether the property is affected by tree orders or applications under the Neighbourhood Disputes (Dividing Fences and Trees) Act 2011.

Heritage considerations must be included if the property is listed under the Queensland Heritage Act 1992 or the World Heritage List. In addition, details regarding swimming pool safety compliance, recent owner-builder works, any outstanding show cause or enforcement notices under planning or building legislation, and current rates and water charges must also be provided.

Climate Risk Disclosure: Sellers must provide information on potential climate risks associated with the property, including flood risk, coastal erosion, and future impacts of sea-level rise. This is designed to give buyers a clear understanding of any environmental factors that could affect the property’s value and insurability

2. Leasing provisions

Lessor’s Consent Process: The Act introduces a new requirement for tenants seeking the lessor's consent for actions such as assigning the lease, subleasing, altering the premises, or changing the permitted use. Tenants must now provide notice to the lessor, and the lessor is required to respond within a prescribed timeframe. If the lessor fails to respond within this timeframe or unreasonably withholds consent, the tenant has the right to seek legal relief or damages.

Release of Lessee and Guarantor on Subsequent Assignment: Under the new Act, when a lease is assigned to a new tenant, the original lessee and any guarantor are automatically released from liability for any breaches that occur after the assignment. This provision cannot be waived or altered through the lease agreement, providing stronger protection for both lessees and guarantors.

Enforceability of Covenants: The Act clarifies that, unless otherwise specified in the lease agreement, covenants in a lease will continue to apply to assignees in the same way they applied to the original lessee. This means that any conditions or restrictions outlined in the lease will be enforceable not only against the original tenant but also against any new tenant who takes over the lease.

Notice to Remedy Breach: The Act expands the requirements for lessors who wish to serve a notice to remedy a breach of the lease. Under the new provisions, lessors are now obligated to send a copy of the breach notice to additional parties, including mortgages, receivers, and guarantors. This change promotes transparency and ensures that all relevant parties are aware of potential breaches, enabling them to take appropriate action if necessary.

3. Change to easement covenants

The Act introduces significant reforms to ensure covenants attributed to easements are reliably enforced on successive property owners. Any covenant, whether positive or negative, attached to a registered easement will automatically bind future owners of the burdened land, unless the covenant is expressly stated to be personal to the original parties involved in the easement.

If the original easement agreement specifies that the covenant is personal to the original grantor and grantee (the parties at the time of creation), then the obligations do not transfer to future owners. Additionally, the Act operates retrospectively, meaning that easements created before the new legislation still fall under the new provisions. Therefore, any pre-existing positive or negative covenants in a registered easement that affect the use, ownership, or maintenance of the land will continue to apply to future owners, regardless of when the easement was established.

4. Limitation periods

The Bill amends the Limitation of Actions Act 1974 so that the limitation period for deeds entered into after commencement is reduced from 12 years to six years to match the limitation period for contracts, improving consistency.

WHAT THESE CHANGES MEAN FOR YOUR BUSINESS

If you are involved in property transactions, whether as a seller, buyer, or real estate professional, these changes will have a direct impact on how deals are conducted. Key steps your business should take include:

• For Sellers: Ensure that you are ready to meet the new disclosure requirements. This includes gathering the necessary information regarding property condition and climate risks well in advance of listing a property for sale.

• For Buyers: Take advantage of the increased transparency. Being aware of the disclosures will help you make more informed decisions about property purchases.

HOW GML CAN ASSIST

The team at Gibson MacNeill Lawyers is here to guide you through these changes and ensure your property transactions comply with the new laws. Our experienced team can assist in:

• Reviewing contracts and providing advice on how to meet the new disclosure and compliance requirements.

• Helping resolve property disputes related to easements or other property rights.

  
  

If you have any questions or would like assistance navigating these new laws, please don’t hesitate to reach out to the team at Gibson MacNeill Lawyers for tailored legal advice