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20 SEPTEMBER 2010 – NOFICIATION OF EXISTENCE OF ELECTRICAL SAFETY SWITCH

20 SEPTEMBER 2010 – NOFICIATION OF EXISTENCE OF ELECTRICAL SAFETY SWITCH

Q.What are the Sellers and Buyers obligations regarding an electrical safety switch?

A. The Seller of a residential house or residential unit must notify the Buyer in writing whether an approved safety switch has been installed for the general purpose socket outlet in the house/unit. This must be done prior to the Buyer taking possession of the property. The standard REIQ Contract makes provision for this to be done. If notice is not given to the Buyer or if the notice is wrong, false or misleading, the Seller will be liable to pay a monetary penalty.

The Form 24 which accompanies the land transfer document provides that the Seller must notify the regulator under the Electricity Act in writing whether there is an approved safety switch, within 90 days of the Buyer taking possession of the property. There is a monetary penalty payable by the Buyer is this is not done.

It appears that the failure to give the correct notice does not effect the validity of the Contract.

Once the Seller has given the Buyer notice, then if a general purpose socket outlet was installed in the residence prior to 1 July 1992 and there is no electrical safety switch the Buyer must have one installed within 3 months from the date of possession. Again there is a monetary penalty payable by the Buyer is this is not done.

TIP: If a Seller finds out that their statement regarding the existence of the safety switch is wrong they should immediately notify the Buyer of the correct information.

When a Buyer is negotiating to buy a property they should establish whether a safety switch exists and if not, factor in the cost of installing one when they consider the purchase price.

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