Emil Ford Lawyers

Buying Development Sites with Existing DAs

When purchasing property, most developers know they cannot rely on a pre-existing Development Approval without at least making further enquiries. In many circumstances, further applications will be required to align a pre-existing development approval with the developer’s plans.

A recent decision of the Court of Appeal of the New South Wales Supreme Court provided a cautionary reminder of what can go wrong when purchasing a property and accepting the existing Development Approval at face value.

In this case, the developer had contracted to purchase a property, attracted by an existing Development Approval. After paying the deposit, the developer was advised that a Construction Certificate would not be issued without significant amendment to the Development Approval, involving significant delay and expenditure.

The developer sought to postpone settlement and negotiate an altered price in light of these issues. However, the vendor refused to negotiate the purchase price, and issued a Notice to Complete. When the developer failed to complete the purchase, the vendor terminated the contract, resulting in the developer forfeiting both his deposit and the development opportunity.

Failure to make proper evaluations and enquires about existing Development Approvals prior to purchase can lead to substantial cost and frustration down the track.

for advice on purchasing a development site.

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