A buyer in Queensland signed a contract on 22 January. The deposit of $98,500 was due the next day.
He went to transfer it and his online banking wouldn’t send that much in one hit. Anyone who has moved a large sum knows the screen. There’s a daily limit sitting on the account that you’ve never once thought about, because until today you’ve never needed to move six figures before lunch.
So he did the sensible-looking thing. He split it and paid it across two days. One day late.
The seller terminated the contract on 29 January and kept the deposit.
He took it to the Supreme Court of Queensland and he lost. He lost the house and he lost the $98,500, for being one day late on a payment his own bank wouldn’t let him make.
But the agent said it was fine
This is the part I want you to sit with, because it’s the bit that generalises.
He had told the agent. The agent had been relaxed about it. As far as he understood, everyone was across the situation and nobody had a problem.
The court’s answer was that the agent never had the authority to vary the contract. An agent works for the seller, and being the person you talk to every day is not the same as being the person who can change your legal obligations. The seller was never bound by anything the agent said, so the seller was free to terminate.
Genuinely, this is the most expensive misunderstanding in residential property. The agent is not a neutral party and they cannot rewrite your contract. Neither can a friendly text message.
If a deadline in your contract needs to move, it moves in writing, between the two solicitors or conveyancers, and not before.
What “time is of the essence” means
Most contracts of sale contain a clause saying that time is of the essence.
It reads like boilerplate. It isn’t. It’s the clause that turns a due date into a hard deadline, and it means a delay is not a technicality to be sorted out later. It’s a breach, and it hands the other side the right to walk.
Without that clause you’d generally get a reasonable period to fix things. With it, one day late is late.
The court also made the point that the seller was under no obligation to accept the money once it was overdue. She didn’t have to be reasonable. She didn’t have to give him a chance. The deadline had passed and the contract said what it said.
Does this apply in Victoria?
Different state, same principle.
Victorian contracts carry their own deadlines and their own consequences, and the general conditions of a standard contract of sale set out when the deposit is payable. If you miss it, you’re in breach, and what happens next depends on the contract in front of you rather than on anyone’s goodwill.
What Victoria does give you that Queensland doesn’t work the same way is a cooling off period under section 31 of the Sale of Land Act. Three clear business days on a private sale, and the penalty for using it is $100 or 0.2% of the purchase price, whichever is greater. On a $900,000 purchase that’s $1,800 to walk away.
Two things people get wrong about it. Clear business days means the day you sign and the day you withdraw don’t count, only the full days in between. And there is no cooling off at auction, or within three clear business days either side of a scheduled auction. Hammer falls, you own it.
To be clear, cooling off is an exit from the contract. It is not a grace period on a deadline inside the contract. Once you’re past it, the dates are the dates.
None of this is legal advice and I’m not a lawyer. Your conveyancer reads your actual contract, and that’s the conversation worth having before you sign, not after.
The deadlines that actually bite
The deposit is the one that made the news, but it’s not the only date sitting in your contract with teeth.
The deposit. Usually due on the day of signing or the next business day. This is the one that catches people out purely on bank mechanics.
Finance approval. Miss the date without an extension agreed in writing and you can lose the protection of the clause entirely. Then you’re unconditional whether or not the bank has said yes.
Building and pest. Same story. The right to walk away over a bad report expires, and it expires on a date, and nobody rings to remind you.
Settlement. Late settlement usually triggers penalty interest, and on a bad day it triggers termination.
Every one of those is a date on a page that somebody has to actually diarise. In our own process that’s a job, not a hope.
What to do before you sign
Ring your bank about your transfer limit. Not after you sign. Before. Ask what your daily limit is and what it takes to raise it, because some banks want 24 or 48 hours’ notice and some want you in a branch. If it’s awkward, arrange a bank cheque instead and know where you’re collecting it from.
Read the deposit clause out loud. How much, to whom, by when, in what form. It takes ninety seconds and it is the single highest return ninety seconds in the whole process.
Get every variation in writing from your conveyancer. If a date needs to move, it moves solicitor to solicitor. A conversation with the agent is not a variation and will not save you.
Diarise every date the day the contract is signed. Deposit, finance, building and pest, settlement. Put them in the calendar with a reminder three days out, not on the day.
Know your cooling off position before the hammer or the pen. Private sale or auction changes what you have, and at auction you have nothing.
Kate has heard me say all of this at least four hundred times and she still can’t understand how a bank transfer limit can cost someone their house. Honestly, neither can I. But that’s the system, and it doesn’t care whether the rule is fair.
There are roughly forty checks worth doing before an offer goes anywhere near a seller, and the contract dates are only one line of it. We put the whole due diligence checklist up for free, so use it.
If you take one thing from this: the contract does not care why you were late. Your bank’s daily limit, a public holiday, a slow email, a friendly agent who said it’d be right. None of it appears in the clause. The date does. Sort out the boring mechanics before you sign, because the day after you sign is too late to discover them.
If you want someone whose job is to catch this before it costs you, that’s what we do.