The importance of a Form 1

Published On: 21 March 2024
The importance of a Form 1

The Form 1 is supplied to a buyer by a seller when buying or selling property in SA.

It is required under section 7 of the Land and Business (Sale and Conveyancing) Act 1994 (SA). It is a very long document!

If you’re a seller

You must supply a Form 1 vendor disclosure statement to your buyer/s as part of the property transaction.

We’ve answered some key questions about this important document for you.

What is a Form 1?

The Form 1 is a legal document that provides important information about a property and is provided to any purchaser of a property.

It’s critical that the form is prepared in accordance with the Act. There may be serious consequences to both a seller and agent for any defective or invalid Form 1s.
The Form 1 is a disclosure statement and contains vital details about the property being sold, so that the buyer can make an informed decision about their purchase.

The form ensures that there is transparency in the process and protects the buyer from hidden issues or potential risks that may be associated with the property.

It must set out:
  • The purchaser’s “cooling-off” rights
  • The property’s title and ownership – it confirms the seller’s ownership and outlines any encumbrances or restrictions on the property. This includes mortgages and easement details.
  • Zoning and planning information. The buyer will see the permitted use and any applicable development restrictions, and if there’s a heritage listing that affects the property.
  • Encroachments or boundary disputes that may exist concerning neighbouring properties.
  • Building approvals and compliance certificates will be detailed in the form.
  • The availability and location of essential services and water, gas, electricity and sewerage utilities.
  • Environmental matters, such as contaminated soil, or nearby hazardous waste sites.
  • Council rates and charges are detailed in the form, including if there are any outstanding amounts owing.
Who handles the filling out of the Form 1?

It is the seller’s conveyancer or real estate agent who hold the responsibility for preparing the form.
But the seller must ensure that they provide accurate information to be included in the form.

What does disclosed information mean?

It means that the form contains all the information required so that a buyer understands what could affect their purchase of the property.
If the buyer isn’t satisfied with the information contained in the Form 1, they have the right to withdraw from the contract during the “cooling off” period.

How does the purchaser obtain the Form 1?

Once the seller has signed the Form, it must be given to the buyer no later than 10 clear days before the settlement date. The form can be supplied either before or after the signing of the contract.

The buyer can receive the Form 1 in one of these ways:

  • It is delivered to the buyer in person
  • The form is posted using Registered Post to the buyer’s last known address (so if you are a buyer make sure your information is current)
  • It can be faxed a number provided by the buyer
  • The form can be emailed to an address provided by the buyer

We recommended that the buyer acknowledges receipt of the Form 1 , even though it is not a requirement under the Act.

How accurate is the Form 1?

The information contained in the form must be completely accurate – this includes any statutory search information that is contained in the form. As searches become “older”, there is an increased chance that they may be inaccurate and that a change in circumstances may have occurred.

What is a cooling off period?

A buyer of land is entitled to a “cooling-off” period. This is a period of time when the buyer can withdraw from the contract by giving written notice to the seller or the agent acting on behalf of the seller.
There’s only a reasonably short period of time – two business days – for the buyer to review their decision to purchase the property and withdraw from the contract if necessary.

The date of service of the Form 1 will determine when the cooling-off period starts and finishes.

  • If the Form 1 is served after the contract is signed by all parties: the cooling off period commences on the next business day after the Form 1 was served, and expires at the end of the second business day after it was served
  • If the Form 1 is served before the contract is signed by all parties: the cooling off period commences on the next business day after the contract was signed by the last of the parties, and expires at the end of the second business day after it was signed by that party
  • If a buyer chooses to exercise their cooling off right and withdraws from the contract, they’re entitled to the return of money paid (the deposit) under the contract.

Not all buyers of land have the right to cool-off!

The cooling-off period doesn’t apply if:

  • The property is being purchased at auction
  • The property is under a contract for the sale of land (other than residential land) by a company
  • The property is under an option to purchase and that option is exercised
  • The buyer, before signing the contract, received independent advice from a legal practitioner concerning the contract and the practitioner signed a regulation approved certificate that the practitioner gave the buyer that advice.

The Form 1 is quite a lengthy document and can be overwhelming, that’s why it’s a good idea to have Strathalbyn Conveyancing help you with the form.

Our Conveyancers have extensive experience in the preparation of a Form 1 for sellers and agents. We make it simple to get your Form 1 Disclosure Statement right, so that you have peace of mind throughout the process.

And if you are a buyer, we can help you understand the information in the Form 1, so you are protected.