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Clause questioned
I read with interest an article penned by Warkworth lawyer Patrick Steuart for the Mahurangi Matters (MM, Jun 24) headlined, “Is now the time to buy?”
For the most part it offered very sound advice up until it suggested that a well-crafted “due diligence” clause be included in the contract for sale and purchase. This clause means if you’re not 100% sure about buying the property and find something that changes your mind you can exercise your right to cancel the contract.
Real estate contracts typically involve two parties, the seller and the buyer.
I have been in the real estate profession for a long time and never in all that time has there been more information available for researching properties available to sellers and buyers.
Specific information relating to the property is readily available from local councils such as a LIM report or the more comprehensive property file.
Most buyers of property, not all, are quite rightly very well researched when they go to their property of interest and extremely knowledgeable about it.
The due diligence clause mentioned is not a good clause for the sellers of property as it can tie it up for considerable periods of time with no certainty for the seller of a sale. Effectively the due diligence clause turns the contract into an option to buy, which is not good.
If the well-crafted due diligence clause was inserted on behalf of the purchaser to enable them to make further genuine enquiries about the state of the property, not the suitability of it, then specific clauses relating to the issues of concern should be included.
Issues relating to finance, the LIM report, building report, toxicology report, OIA and the Land Act consent, along with time frames for their completion, are on the front page of the standard agreement for sale and purchase.
If more information is required, from say an engineer, surveyor or valuer, development consultant or other specialist consultant, clauses for those can be included in the contract along with the time for completion.
Another thing to note is that withdrawal from a contract because the due diligence clause was not satisfied, does not have to be explained to the seller at all – they are usually left in the dark, with no idea why the contract failed to complete.
With the building report in the standard contract, there is a requirement to make the report available if asked.
Buying and selling property at the best of times can be a stressful experience for all parties, but most of the stress can be avoided if all the parties involved are fair and honest in every respect.
Due diligence clauses only have one party to the transaction in mind, and that is the buyer.
There are some transactions, in complicated purchasers, where it is necessary to include a clause such as that.
It appears to me however that purchasers are encouraged to use their due diligence clause, even in simple contracts, as a “get out
of jail” free card for the lazy and those just wanting to tie up a property, while they make up their minds about that property or find another, as the case may be.
If a seller finds themselves in a position where they feel they are being pressured into accepting a due diligence clause by the purchaser, then they can ask their real estate agent or their solicitor to ensure that a “better offer” clause with a short notification period (three to five working days) be inserted into the contract also.
This is a must-do, to protect the position of the seller as it will enable them to consider better offers, if and when they arise.
Greg Allen-Baines, Warkworth
More local board funds
Despite the loud claims on social media from some Rodney Local Board (RLB) members, (and as the hard working RLB members know), the $8m-boost to RLB’s operational spending in 2025/26 did not represent any special efforts by them.
The increase arises from a review of service levels initiated by Auckland Council’s Governing Body that looked at the equity of its allocation of operational funding (which is done by a formula) and of facilities provision across local boards.
The review and Governing Body agreement has taken seven years, and the work was undertaken as a result of the Northern Action Group’s (NAG) submission to get North Rodney out of the supercity, which was declined.
It was also in response to the Local Government Commission’s subsequent recommendations (March 2018) that the governance of Auckland was not working well enough.
The commission said council needed to focus more on: transparency; putting customers first; more nuanced funding allocations; addressing legacy inequalities, and improving representation arrangements.
More funding for Rodney’s road sealing was specifically recommended by the commission.
Council’s two responses (June and November, 2018) flagged that they would make this a long-term “work in progress”.
Incidentally, the November 2018 report noted that the Regional Land Transport Plan had $121.3m for seal extensions across Auckland.
Council (under Phil Goff) subsequently reneged on that and it is only the understanding of need and commitment by Mayor Wayne Brown and our local Councillor Greg Sayers that has seen this now restored (seven years later!) to the current $124m.
Despite the delays, it is very pleasing for Rodney to see council now give the RLB more responsibility and funding to support Rodney’s communities.
NAG has long argued for that and for community empowerment.
But the credit, if any is due, must go to the early visionaries and founders of NAG, like Bill Townson, who set out the case.
He persistently argued that the “supercity” model was not “fit-for-purpose” for Rodney; that having urban-centred, Auckland-wide common policies disadvantaged Rodney; for greater community empowerment, transparency and accountability; and for improving democracy, efficiency and governance for the people of Rodney.
Credit is also due to those within council that have progressively been prepared to see the need for, and implement, more nuanced democratic fairness and respect for communities as the basis for successful local government.
That “cause” continues, and our RLB is to be praised for taking on the challenge of better supporting our communities and their needs. But they can’t lay claim to credit for decisions they don’t make and had no part in (N.B. only Colin and Louise were RLB members back in 2018).
Bill Foster, Leigh
Watercare or not care
I don’t think Watercare is being very upfront with us in regard to the sewer overflows. During the rain last week the sewer was spewing out of a manhole on Elizabeth Street outside Katya Maker boutique.
Obviously the system is getting inundated with storm water! The best way to fix this would be to inspect all houses and businesses on the system and locate illegal stormwater connections into the sewer.
There would only be 3000 or so homes plus businesses to check, it shouldn’t take too much time or expense to do the inspections. Once found the homeowner could have a timeframe to rectify the issue.
I feel Watercare is misinforming us when saying the problem will be addressed with the pipeline upgrade as this is really about providing a connection from new subdivisions.
On the issue of our drinking water supply, the water tastes bad and is full of silica, which is severely damaging and limiting the life of any fixture connected to it.
Also, I have just read that we won’t be getting a pool as the million-dollar Watercare fee to connect to the water is too expensive!
If the money collected from the connection fees was used to improve our water and wastewater instead of lining the pockets of the upper management I could maybe be closer to understanding why such high connection costs are needed!
Peter Mahady, Warkworth
