Tony and Charlotte had held onto a large piece of land for over 40 years as an investment for their retirement. Their children had all left home so they decided the time was now right for them to subdivide and sell off part of the land behind their house which would give them some spare cash to be able to travel overseas.

Tony and Charlotte engaged a surveyor to prepare a survey plan and assist them with applying for resource consent for their subdivision from the local Council. Not long afterwards they were approached by their neighbour, James, who was keen to buy the spare section from them so he could build a new house. James presented them with an offer on what looked like a fairly standard agreement for sale and purchase with a purchase price they were happy with. The contract was only conditional on a new title issuing for the section and settlement was in one month’s time. Tony and Charlotte were excited with James’ offer because they would soon have money available to book their dream holiday and they happily signed the agreement to accept James’ offer.

After the agreement was signed it was sent to Tony and Charlotte’s solicitor. Tony and Charlotte had not discussed their plans to subdivide the property or its sale with their solicitor earlier and they were unaware of all the paperwork that still needed to be prepared for the subdivision. Because of the short period until settlement, the solicitor arranged an urgent meeting with Tony and Charlotte to discuss their resource consent and the legal documents to be prepared and lodged with Land Information New Zealand before a new title could issue for their land.

Unfortunately it was not possible for everything to be completed for settlement to occur in one month and James became frustrated with the delays with the new title issuing and cancelled the agreement. James had found another section to buy in the meantime and Tony and Charlotte have sadly had to put their holiday plans on hold while they complete the subdivision and find a new buyer.

Subdivisions can be complex and it is important to seek legal advice and to discuss the timing of carrying out a subdivision with a solicitor. A solicitor will need to review the resource consent and survey plan and consult with the surveyor over the terms of the resource consent. If you want to sell your land before the subdivision is completed, a solicitor can help you to prepare an agreement with appropriate conditions.

Linley Hawkes, Phone 915 4384 or email: linley@dhlawyers.co.nz