Understanding Requisitions on Title in New South Wales

Understanding ‘Requisitions on Title’ might look complex at first but in this article, we will break down the key aspects and explain how it affects you.  

What are requisitions on title in NSW?

Requisitions on title are a formal set of questions or requests a buyer can make to the seller after contracts are exchanged. Historically, these questions were not limited and helped clarify issues relating to the title such as confirming that the seller can transfer ownership, checking for defects in title and ensuring the property is free from undisclosed encumbrances.

In more recent times, there has been a change in approach in the property industry in New South Wales – with most standard form contracts limiting the questions that can be asked by a buyer to a pre-set list of questions that are included in the contract.

Types of Requisitions

There are four categories of requisitions on title:

Requisitions as to title. These are matters concerned with the dealings that may or may not be included on the title deed for the property. They involve dealings like mortgages, easements, caveats or covenants that may require removal on or before the completion of contract.

Requisitions in the nature of reminders. These are reminders to both parties to ensure that the contract is complied with. For example, any caveat on title or mortgage must be removed before settlement, and so on.

Requisitions as to property. These are matters relating to how the property will pass to the buyer such as the documents to be handed over at settlement. This may include enquiries about survey reports, building works or information about existing tenancies, if applicable.

Requisitions in the nature of general enquiries. These are best described as things that are routinely asked and may include information on how matters are to be dealt with on completion. For example, adjustments to be made, documents to be handed over, or the existence of any statutory notices.

Can the number and type of questions asked by the buyer about the property be limited?

As outlined above, in most NSW Contracts for Sale, the traditional concept of requisitions on title is generally narrowed through the inclusion of a special condition in the contract. The effect of this type of special condition is to limit the buyer’s right to issue/raise requisitions and effectively streamlines the process by stating that all requisitions are deemed to have been asked and answered upon exchange.

In practice, this means:

• the contract already incorporates the standard set of requisitions;
• the buyer cannot submit further or expanded requisitions unless the contract expressly allows it (which is rare); and
• the seller is treated as having already responded to the standard enquiries that would historically have been raised after exchange.

This special condition is designed to prevent prolonged negotiations after contracts are signed and exchanged. It makes it clear that requisitions on title are limited to matters affecting title, not matters relating to the property’s physical condition, use, compliance, or any external risks. So, for example, a buyer cannot use requisitions to ask about (for example):

• whether a swimming pool complies with the Swimming Pools Act;
• whether building works at property were approved by the relevant local council;
• boundary fencing disputes;
• zoning concerns or future developments nearby; and/or
• issues uncovered in a pre-settlement inspection

These are all treated as matters for the buyer’s own independent enquiries. The special condition also reinforces the seller’s limited disclosure obligations. The seller must only disclose what the contract and legislation require (for example, prescribed documents under the Conveyancing (Sale of Land) Regulation), but nothing more. The seller is not required to answer additional questions outside the narrow scope of title.

For buyers, this means that once the special condition is triggered, there is very little room left to raise any new issues. Even if a buyer discovers something after signing, they may not have a contractual pathway to demand answers or require the seller to remedy the situation unless it relates directly to title, or unless the seller has breached an express warranty.

Most contracts expressly say that the buyer is taken to have relied on their own enquiries and inspections. This means buyers cannot treat requisitions as a second chance to investigate the property or delve into issues they overlooked before signing. By that stage, the buyer is generally locked into the contract and carries the risk for anything they did not check beforehand (unless protected by an express special condition).

How can buyers best protect their interests?

As requisitions on title are now quite limited in practice, buyers must do their own inspections before contracts are signed and exchanged. If you are a buyer and have questions about the property, you should ensure you raise them prior to signing the contract. However, please remember that most contracts in NSW do not allow you to rely on any representations or statements by the agent or seller, and so you should always independently verify any information that is provided to you by a seller (or their agent).

In terms of how you can independently verify certain types of information, you (as a prudent buyer) should consider doing the following:

• Order an indpendent building and pest inspection
• Order a strata report (if applicable)
• Engage a lawyer to provide you with independent legal advice on the contract
• Inspect council records or planning certificates
• Order or conduct any other searches relevant to that property

Need help buying property?

If you need a lawyer to assist you with understanding how requisitions on title work or to act for you in relation to the purchase of property, please check out our Buying a Property Information Centre, where you can get more information about our conveyancing services and get an instant quote.

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