The Sales Agency Agreement (SAA), Contract and Form 1 are important legal documents which form part of most property sales transactions. One of the most important aspects of these documents, is making sure the correct party’s details are included on the relevant document and the appropriate party executes it. If the wrong person executes it, the relevant document could then be either seen as invalid, voidable or defective likely causing settlement delays.
We’re often asked by agents, vendors, and purchasers to assist with clarification surrounding who’s noted on particular documentation and who is required to sign it. As such, we’ve popped together a quick reference below which hopes to provide some guidance around this:
When it comes to the Sales Agency Agreement (SAA), contract and Form 1, the name should read:
Power of Attorney: The name of the Vendor should still appear on the document.
The Attorney does not become the Vendor but has powers to execute/sign/instruct on their behalf.
Executor: The name of the Executors should appear noting “as Executors of the Estate of insert deceased registered proprietors name”
Company: The name of the Company should appear.
Vendor: The name of the Vendor should appear.
If a name has changed since registering on the Title (e.g. due to marriage), you can note the Vendors current name stating “(formerly XYZ)”. For example, Michelle Anne Smith (formerly Taylor)
What signatures are required on the Sales Agency Agreement (SAA), contract and Form 1?
Power of Attorney: The Attorney should execute the documents.
If possible, it would be beneficial to note under their signature “as Power of Attorney for insert Vendors name”
Executor: The Executors should execute the documents.
No further wording would be required under their signature as the signers are the same as those noted on the documents.
Company: The Director/Secretaries should sign on behalf of the Company (refer to an ASIC Extract for confirmation of the current officeholders).
When there are two or more Directors/Secretaries, pursuant to the Corporations Act, a minimum of 2 should be signing to duly execute on behalf of the Company (unless their constitution states otherwise).
Vendor: The Vendor should sign.
What happens if it’s incorrect?
As conveyancers we are here to assist agents, vendors and purchasers to ensure that the correct details are included on the documents and the correct party is executing. We’ve briefly outlined the issues which can result if these documents aren’t completed accurately.
Sales Agency Agreements: A real estate agent cannot act for a vendor unless authorised to do so by both parties signing a Sales Agency Agreement (Agreement). If the incorrect party executes the Agreement then there is a risk that the payment of monies owed to the Agent for the sale might be uncertain, there could also be other compliance issues for the Agent.
Contract: there is potential that an incorrectly executed contract could be voidable by one or both parties which means there is uncertainty around whether the transaction will proceed for Vendor, Purchaser and Agent.
Form 1: potentially being defective, leading to the likely need to re-serve which opens cooling off up again meaning the Purchaser has the option to walk away from the transaction. Once again there is uncertainty for the Vendor and Agent that the deal can proceed if defective.