Local Law 17: Selling Waterfront Gold Coast Property
With an assortment of canals, rivers and creeks, the Gold Coast contains many beautiful waterways. To protect both these waterways and buyers of property situated in these waterways, Gold Coast City Council (‘Council’) introduced Local Law No. 17 (Maintenance of Works in Waterway Areas) 2013 (‘Local Law 17’) and Subordinate Local No. 17.1 (Works in Non-Coastal Waterway Areas) 2013 (‘Subordinate Local Law 17.1’) in 2013. These local laws impose certain disclosure obligations on sellers of property situated in Gold Coast waterway areas.
What waterways are covered by Local Law 17?
Local Law 17 applies to a broad range of waterways including tidal waterways, non-tidal waterways, lakes, artificial waterways, coastal wetland and drains, channels, structure or other works used to receive, store or transport stormwater (if they are more than one metre deep and have a cross sectional area more than 2.5 square metres) located within the Council’s area pursuant to section 5 of Local Law 17. Local Law 17 also applies to land that is located on a waterway other than allocated State land.
However, the following are not considered ‘waterways’ for the purpose of Local Law 17:
- Swimming pools;
- Ornamental ponds of no more than 5,000 square metres in area;
- Ponds for aquaculture or treating effluent;
- A freshwater storage reservoir for domestic water supply;
- A water storage facility situated on a watercourse and used for irrigation or other agricultural purposes;
- Navigation channels, harbour swing basins, berth pockets or berth approach/departure paths used for accessing port infrastructure if constructed in the area of a port authority or port operator.
What is a ‘Specified Prescribed Work’?
Part 6 of Local Law 17 deals with the sale of land on which a ‘specified prescribed work’ is completely or partly situated, or waterfront land connected to a specified prescribed work (‘Relevant Lot’). Section 5 of Subordinate Local Law 17.1 defines a ‘specified prescribed work’ to mean each of the following:
- Revetment walls;
- Training walls;
- Jetties; or
Who is responsible for a Prescribed Work?
Section 9 of Local Law 17 states that the person responsible for a prescribed work is any and all of the following:
- The owner of freehold land on which the prescribed work is partly or completely located;
- The tenant of leasehold land on which the prescribed work is partly or completely located;
- An occupier of trust land or non-freehold land (e.g. a road) on which a prescribed work is partly or completely located;
- The owner of freehold land, the tenant of land leased from the State or an occupier of non-freehold land that is waterfront land and received the benefit or the prescribed work;
- Anyone else who is responsible under any law or agreement to ensure the prescribed work is maintained in a safe condition or good working order, repair and condition;
- Anyone else who is responsible for any wrong arising out of a failure to ensure the prescribed work is maintained in a safe condition or good repair and condition; and
- The owner of the prescribed work.
Contracts for the sale of a Relevant Lot
Under section 15 of Local Law 17, a seller of a Relevant Lot (regardless of whether they are the responsible person) must ensure that the contract of sale includes a clause stating or specifying the following matters:
- The contract is a contract to which section 15 applies;
- The actual specified prescribed work that is completely or partly situated on, or which is connected to, the relevant lot;
- Under Local Law 17, a person who is a responsible person for the specified prescribed work is, at that person’s cost, required to maintain and keep the specified prescribed work in:
- a safe condition; and
- good working order, repair and condition, including so that the prescribed work can continue to perform its intended function; and
- Whether or not there is an outstanding notice issued by the local government under Local Law 17 in relation to the actual specified work and, if so, the contents of that notice.
If the seller of a Relevant Lot fails to include such a clause in the contract addressing the above matters, they not only risk a fine of up to $5,890 but the buyer can terminate the contract at any time before settlement. If the buyer exercises their right to terminate the contract, then the seller must refund any deposit paid by the buyer.
It should be noted that the termination right afforded to buyers under Local Law 17 may be fettered by section 57A of the Property Law Act 1974 (Qld) and as such, any decision to terminate a contract of sale pursuant to Local Law 17 should be undertaken after obtaining thorough legal advice.
How do you know if Local Law 17 affects your property?
Unlike Queensland pool safety certificates and tree dispute orders, there does not yet exist a search mechanism to enable either sellers or buyers to ascertain with any certainty whether Local Law 17 applies to a specific Gold Coast property. Unhelpfully, Council rates searches for properties simply state that Local Law 17 may apply.
For this reason, if you are unsure whether Local Law 17 applies to your property located near a waterway on the Gold Coast that you are selling, it seems best practice is to err on the side of caution by including a clause in the contract of sale that complies with section 15 of Local Law 17. The consequences of not including such a clause in the contract could potentially be serious.
It is also recommended that sellers (and buyers) engage a building inspector, surveyor or other expert to clarify the proximity of any waterway or specified prescribed work to the relevant property if they suspect that Local Law 17 may apply.
If you would like further advice about buying or selling property in the Gold Coast or Queensland, please contact us and one of our experienced property lawyers will be able to assist.