Should a Lawyer Complete a Contract Review Before I Sign the Contract?
If you are buying a property in Victoria, you will almost certainly come across the Section 32 Statement. It is a critical part of the sale process, but many buyers do not really read it.
Others read it without knowing what they are looking for. That is risky. If there is a problem in the disclosure, or if the contract contains an unfavourable special condition, it can lead to delays, unexpected costs, and in some cases a purchase that no longer makes sense once the fine print catches up.
This article explains what the Section 32 is meant to do, what it does not do, and why a contract review before signing is often one of the simplest ways to reduce risk.
What is a Section 32 Statement and Why Does It Matter?
A Section 32 Statement, also called a Vendor’s Statement, is required under the Sale of Land Act 1962 (Vic). It must be given to a buyer before the contract is signed. The purpose is disclosure. It is designed to tell the buyer key information about the land and certain matters that affect it. It commonly includes title details, information about easements and restrictions, planning and zoning information, and details about rates and outgoings. Many buyers assume that if the Section 32 has been provided, everything must be in order. That is not always the case. Documents can be incomplete, out of date, inconsistent with the title search, or drafted in a way that is technically compliant but still leaves important practical questions unanswered.
What can go wrong in a Section 32
A Section 32 is not a building report, and it is not a guarantee that the property is problem free. It is a disclosure document, and it has limits. Some common issues that arise in practice include the following. A buyer assumes defects will be disclosed.
The Section 32 usually will not tell you whether the bathroom has been waterproofed properly, whether the extension was approved, or whether the subfloor is home to a thriving ecosystem. Those are inspection issues. A buyer who relies solely on the paperwork can end up inheriting expensive repair work. A buyer does not understand planning and restrictions.
A property can look ideal on inspection yet still be subject to planning controls that materially limit what can be done with it. Restrictions may affect renovations, redevelopment, or even day to day use. Heritage overlays and other planning constraints commonly catch buyers by surprise, particularly in established Melbourne suburbs. Even where the Section 32 includes the planning certificate, the practical consequences are not always apparent unless the documents are read in context and properly interpreted.
A buyer overlooks mortgages, caveats, or other interests
The Section 32 is intended to disclose mortgages and other encumbrances affecting the title. Difficulties arise where disclosure is incomplete, unclear, or where the vendor has not put appropriate arrangements in place to deal with the encumbrance at or before settlement. If these issues are not identified and addressed early, they can cause settlement delays, increased costs, and avoidable anxiety for the buyer.
A buyer misses the contract special conditions
Often the most significant risk to a purchaser is not found in the general conditions, but in the special conditions drafted for that specific sale. These clauses can shift risk onto the buyer, limit rights that would otherwise apply, or impose strict timeframes and financial consequences. They should be reviewed carefully before signing, not discovered after a dispute arises.
In Victoria, many of the most important buyer risks sit not in the general conditions but in the special conditions. Deposit release, default interest, short settlement periods, limited requisitions, or clauses shifting risk to the purchaser can materially change the deal.
Should a lawyer review the contract before signing
For most buyers, yes. A contract review is not just a formality. It is an opportunity to identify issues early, explain the legal effect of what is being signed, and recommend amendments where appropriate.
A contract review typically focuses on whether the contract and Section 32 correctly identify the property, whether disclosure documents are complete, whether there are title or planning issues that matter for the buyer’s intended use, and whether any special conditions are unusual or disproportionately favour the vendor.
It can also cover practical risk points such as the finance clause, building and pest conditions, settlement timing, deposit arrangements, and what happens if something goes wrong between signing and settlement.
Practical steps buyers can take before signing
Arrange a legal review of the contract and Section 32 before signing wherever possible. Obtain building and pest inspections where appropriate, particularly for older dwellings or where renovations are evident.
Check owner’s corporation records carefully when purchasing an apartment or townhouse, including fees, minutes, defects, and insurance. Confirm planning and zoning controls where the buyer has a specific plan for the property such as renovation, extension, or running a business from home.
Final thought
A Section 32 is not “just admin”. It is the vendor’s disclosure to you, and it sits alongside a contract that will govern the transaction once signed. A short review before signing can prevent long and expensive problems later.
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