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Legislative Assembly for the ACT: 2003 Week 2 Hansard (4 March) . . Page.. 467 ..

MR HARGREAVES (continuing):

has examined the conveyancing processes of other jurisdictions to see how they have dealt with this problem.

Gazumping rarely occurs in Queensland, South Australia or Western Australia. Stakeholders in these jurisdictions tell us that gazumping never happens because the window of opportunity for gazumping to occur does not exist. This is because contracts are formed in a very different way in these jurisdictions. Everything is done in writing.

When a buyer wishes to make an offer, they are given a copy of the contract by the seller's real estate agent. The buyer writes the details and the amount of their offer on the contract. The contract is then forwarded to the seller who may accept or reject the offer. To accept the offer the seller signs the contract, unlike in the ACT where the signing of the contract does not take place until some time after the oral acceptance of the offer.

In Queensland, South Australia and Western Australia there is no process of exchange. Contracts are binding once the seller accepts the offer by signing the contract. There is no time gap between the acceptance of the offer and the formation of the binding contract. The events occur simultaneously. In other words, there is no opportunity for gazumping to occur. This conforms with the offer and acceptance philosophy under contract law. A gentleman's handshake is not recognised in contract law in terms of land.

In Victoria, approximately 90 per cent of properties are sold by auction. Gazumping does not occur here, because the window of opportunity does not exist. At auction the contract is formed at the fall of the hammer. Once again, there is no wait in weeks for the exchange of contracts to occur.

New South Wales passed legislation in an attempt to eliminate or at least reduce the incidence of gazumping. This attempt failed because the legislative amendments left open the window of opportunity. We should not make the same mistake. Without closing this window no solution will achieve an end to gazumping.

A buyer can have no certainty about that purchase if they know that, for the two to three weeks following verbal acceptance of their offer-until contracts are exchanged-the seller can renege on their promise to sell. In a property market where prices are rising and demand is outstripping supply, one thing is certain: the incidence of gazumping will increase until the window of opportunity is closed.

I am advised that the government's consultation with stakeholders is progressing well, and a proposal to rid the ACT market of gazumping will soon be put forward for the Assembly's consideration and support. I look forward to that. I have been on this campaign trail against gazumping ever since my wife burst into tears and spent a week in bed because she missed out on the property that she loved.

I probably see one of the more regular occurrences when I sit on shopping centre stalls. For other members' benefit, shopping centre stalls are where you stand outside a shop at a little card table and people come up and talk to you. I know there are some members that are strangers to that process, but that is how it works.

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