In this blog/video, we discuss how one extra line in a Special Condition saved a client $3M in an Off-the-Plan deal.

Off-the-plan purchases in Queensland are filled with risk. Long timeframes. Developer-friendly clauses. Unregistered titles. But in this $3 million apartment case, one custom clause saved our client from a costly legal disaster...

Prefer to watch/listen? Click here to consume this content via YouTube!

Hi everybody - George Sourris, Empire Legal.

Today's topic: The lender’s valuation is short — now what?

Some contracts fall apart because of what's not written. This one was saved because of what was. At Empire Legal, we've seen our fair share of big ticket transactions, but this $3 million off-the-plan apartment contract was a standout. Not because it went smoothly (it actually didn't), but because a few extra words protected our client when there was serious risk. Let's break down what happened, why it nearly fell apart, and how that one line in the contract changed everything.

The deal. A $3 million off-the-plan luxury apartment. A buyer had secured a high end off-the-plan apartment in Brisbane's inner city. Prime location, river views. luxury finishes the whole deal.

The contract had been signed months earlier and construction was progressing. The buyer had finance pre-approval. Everything was on track.

That was, until the final contract plan came through. The internal layout had changed slightly - a feature wall was missing, and the balcony was 800mm shorter than originally marketed. Cue the panic!

Okay, what's the problem? Under most off-the-plan contracts, developers are allowed to make "minor" variations, but what counts as "minor" is often led to interpretation, and ripe for dispute.

In this case, the buyer claimed the changes were "material" and wanted out. The developer unsurprisingly, disagreed. Without legal clarity, this was heading straight for termination, and possibly litigation.

The game changer? One line in a Special Condition.

Here's the twist. Our team had previously been engaged to review and amend this off-the-plan contract before it was signed. And we'd added a custom Special Condition that read, paraphrased, "the buyer may terminate the contract if the total reduction in balcony area exceeds 750 mm in any dimension, or if key internal design features including fixed partition walls are materially altered".

In short, the buyer had clear contractual rights around layout and size, with specifics that the standard off-the-plan contract did not cover. The missing wall and reduced balcony both triggered the clause. No argument. No ambiguity. No litigation. The buyer terminated, deposit refunded. No threats, no court, no stress.

Keep in mind here, of course, when altering these contracts during the negotiation stage, the developer has to agree.

Why standard contracts just aren't enough.

Most of the plan contracts are heavily weighted in favor of the developer. There's no surprise about that - anyone buying an off-the-plan should understand that, it's all in the developer's favor. However, they do allow flexibility and everything from floor plans to finishes, to fixtures, to lot boundaries, even settlement timing.

Anything can be negotiated. That's all fine when things go smooth. But when they don't, buyers often find they're stuck with changes they never agreed to or face an uphill battle to prove a material variation to get out of the contract or negotiate. Without proper legal input before signing, most buyers don't know their rights until it's far too late.

Now the lesson: off-the-plan purchases aren't like standard residential sales at all. They involve long timeframes, complex developer rights, unregistered land, or lot titles, exposure to changing lending conditions, and risk of valuation shortfalls at settlement. This is why boilerplate special conditions just won't cut it.

Every buyer should have their contract reviewed before signing, especially if the purchase price is substantial, there's reliance on specific design features, or you have any particular concerns or deal breakers that you don't want to risk (like this situation), and if the project is still in early construction stages. One clause, one paragraph, even one sentence can be the difference between being locked into a compulsory purchase or walking away scot-free.

Empire Legal's take.

Well, we've seen off-the-plan nightmares over the years. We're always there to help our clients. However, clients need to understand there is risk in buying off-the-plan. Sometimes clients won't pay for pre-contract advice and sign without legal advice, or we're called into the scene too late after the buyer has already locked themselves into a bad contract with no escape.

The $3 million apartment example, it didn't settle. And that's okay, because this clause was in place, it didn't need to. The buyer was able to choose to exit the contract and get their deposit monies back. No litigation, no ugly fight. Just good law done right from day one.

By the way, guys, I'm not here to vilify off-the-plan purchases. I personally have friends who have bought off-the-plan and done extremely well and are super happy. Just keep in mind, it is a legal minefield. You need good lawyers in your corner to make sure you are protected.

Buying off-the-plan - don't sign anything until we've looked at it. I'm serious about this one guys. People don't want to pay the fees, but imagine if you locked yourself into something that you can't get out of, you're going to have major buyer's remorse. We do contract reviews for a fixed fee - fast, clear deal saving advice. Talk to Empire Legal today. You won't regret it.

If you're buying off-the-plan, our review fee is a pittance compared to the money and the risk to buy property.

Guys, that's it for this week. Hope you learned a thing or two. Please feel free to get in touch if you've got any questions. Empire Legal - happy to help. Queensland's trusted choice for conveyancing. Over 2,700 Google reviews with a five star average. There's not many firms out there that have that five star average. With that many reviews, guys, and not to mention over 12,000 deals settled. Thanks guys. We'll see you next week.

Finally, if you haven't heard, we've launched our podcast. It's called Raising the Bar, where we story tell excellence in Queensland property. Here is the link to listen. If you prefer to watch, here is the YouTube link.

Also, stay up to date with our miniseries on Seller's Disclosure.

Thanks guys. We'll see you next week!

If you know anyone that is involved in Queensland property, or is just genuinely curious - send them our page, send them our channel. It's all free content. We just want to help you be armed with the tools to make good decisions. Check out our website for more blogs. We've got over 100! 

We want to help you. If you've been listening to us for a while, but you haven't made contact, please do! We want to help people buy and sell homes and deliver QLD's best conveyancing experience. Thanks guys, we'll see you next week.

Subscribe to our YouTube and our blog. We're giving out this content for FREE to help you and your peers. Spread the good word of Empire Legal. We want to help everyone make property law in Queensland easy and smooth sailing. 

If you have any questions, you can email me: george@empirelegal.com.au. 

If this has added value, please share this blog / the YouTube video with a friend. 

Thanks for reading everybody. See you on the next one.

Ladies and gentlemen, please keep in mind that all advice is general in nature and does not constitute legal advice. This is authorised by George Sourris, Empire Legal, Brisbane, Queensland, Australia.

---------------------------------------

We can help…

For simple, sunny, smooth sailing conveyancing - Empire Legal.

We look forward to continuing to help thousands of Queenslanders every year with their conveyancing!

Any questions? Want to know more? Get in contact with us via the below form or via info@empirelegal.com.au.

Note: all information is general in nature and as each matter is unique please contact our office for tailored advices: the above does not constitute legal advice.