After months of work, ADLS and REINZ have released the 11th edition of the Agreement for Sale and Purchase of Real Estate to the legal profession and the real estate industry.

A highlighted sample version is available here.

An updated PPA (Purchase Price Allocation) Addendum is available here.

What started life as an exercise to add a clause to the 10th edition (2) for the new Purchase Price Allocation regime under the Income Tax Act 2007 has turned into a new edition. New editions of the auction and tender versions will follow in the next month or so.

Note to Practitioners re S&P Real Estate - Bill observing Matariki not yet passed
Please note that Matariki has not been included within the definition of “Working day” under clause 1.1(38) of the recently released ADLS/REINZ Agreement for Sale & Purchase of Real Estate (Eleventh Edition) (Agreement) as the legislation embodying this has not yet been passed. We wish to assure practitioners that the ADLS Documents & Precedents Sub-Committee that recently reviewed the Agreement did not overlook Matariki but, as all practitioners will be aware, it is important that the Agreement reflects legislation that is in force. Once the legislation has been passed, then this will be recognised in a new version of the eleventh edition of the Agreement

Te Pire mō te Hararei Tūmatanui o te Kāhui o Matariki/Te Kāhui o Matariki Public Holiday Bill is at Select Committee stage with the report back due on 10 March 2022.
Click here for further information.

Key changes to this version include:

  • Bank cheques: provisions to allow for the discontinuance of bank cheques;
  • Tax Purchase Price Allocation (PPA) Rules: new provisions linking to a newly devised addendum addressing legislative changes to tax purchase price allocation (PPA) rules;
  • Conveyancing Practitioners: amendments made to accommodate Conveyancing Practitioners;
  • Claims for compensation: clarifications have been added to clauses 10 and 11 for situations where a claimant makes a claim ;
  • Limitation of Liability: this clause has been amended in view of the Trusts Act 2019;
  • COVID-19 / Pandemic Provisions clause: a new COVID-19 and Pandemic provisions clause has been included;
  • Warnings and Disclaimers: these warnings and disclaimers have been scaled back and moved from the back page to the signing page.;
  • Signatory provisions: the acknowledgement and warnings on the signing page have been updated;
  • Reformatting: the document layout has been reformatted in several areas, including the signatory page and back page.
  • All references to subclause have been changed to clause.

From a practical perspective, WebForms users should note that:

  • WebForms is not able to convert information stored in Tenth Edition 2019 (2) drafts to the Eleventh Edition 2022 after the release, therefore we suggest all drafts of the Tenth Edition are completed before the release date;
  • When the Eleventh Edition 2022 form is released in WebForms, users’ current stock quantity of the Tenth Edition 2019 (2) will automatically set against the new form. This means that any existing stock will not be lost;
  • Users may finalise a Tenth Edition 2019 (2) draft after the 8 February 2022 release date (stock will be deducted from the new Eleventh Edition 2022), however, for best practice ADLS advises that users should always use the most up-to-date version of the form; and
  • After the release of the Eleventh Edition 2022, the Tenth Edition 2019 (2) will automatically be archived as an “obsolete” form and will be available in only limited circumstances.

A review of this nature inevitably incurs costs, which have culminated in a price increase. Effective from the release date of 8 February 2022, WebForms user pricing (GST exclusive) will be:
Member: $55.00
Non-Member/Real Estate: $97.78
General Public: $122.22

ADLS held a webinar on key aspects of the new edition, presented by barrister Tim Jones and the lead drafter of the edition, Hamilton lawyer Thomas Gibbons.

The webinar covered:

  • the reformatting of the form;
  • changes to the use of bank cheques;
  • addition of conveyancing practitioners, included in the definition of ‘party’s lawyer’;
  • the purchase price allocation clauses;
  • a new set of covid-19 clauses;
  • new signing provisions;
  • an amended limitation of liability clause; and
  • revision of the claim for compensation clauses that have become increasingly used by parties.

For those unable to attend, the webinar will be available from ADLS CPD on demand, please click here.

Thanks to the revision subcommittee, our lead drafter Thomas Gibbons, the ADLS team and all those who contributed points for revision and review of the prior editions. This is a live document and there will be further revision of the 11th edition as and when legislation, court cases or conveyancing practice dictate.