Buyer's Termination Rights: When You Can Walk Away

Buying property can feel like navigating a minefield.

One minute you're excited about your dream home, the next you're discovering issues the seller conveniently forgot to mention.

Thanks to Queensland's Property Law Act 2023, buyers now have stronger rights when sellers fail to disclose important information properly.

Section 104 of the Property Law Act 2023 gives buyers specific termination rights when sellers mess up their disclosure obligations. It's a game-changer for property transactions, shifting some power back to buyers who've generally had to rely on the "buyer beware" principle.

Let's look at when you can use these rights and what you need to know to protect yourself in your next property purchase.

Understanding Section 104 of the Property Law Act 2023

Section 104 is part of Queensland's new seller disclosure regime that came into effect on 1 August 2025. This section specifically deals with what happens when sellers fail to provide proper disclosure or provide inaccurate information to buyers.

You can terminate if the seller provides disclosure documents that are inaccurate or incomplete, but you need to satisfy three specific requirements

The provision recognises that property purchases are significant financial decisions, and buyers deserve accurate, complete information before they commit to a contract. When sellers don't meet their disclosure obligations, buyers shouldn't be stuck with unwanted surprises down the track.

Section 104 applies when sellers either fail to give buyers the required disclosure statement or prescribed certificate before the contract is signed, or when they provide documents that are inaccurate or incomplete about material matters affecting the property.

It says:

    (1)This section applies if—

        (a)the seller of a lot fails to give the buyer of the lot a disclosure statement for, or prescribed certificate applicable to, the lot before the contract for the sale of the lot is signed by the buyer of the lot; or

        (b)the seller of a lot gives the buyer of the lot a disclosure statement for, or prescribed certificate applicable to, the lot before the contract for the sale of the lot is signed by the buyer of the lot and all of the following apply—

            (i)the statement or certificate is inaccurate or incomplete in relation to a material matter affecting the lot at the time it is given to the buyer;

             (ii)at the time the contract is signed by the buyer, the buyer is not aware of the correct state of affairs concerning the matter;

            (iii)if the buyer had been aware of the correct state of affairs concerning the matter, the buyer would not have signed the contract.

    (2)The buyer of the lot may terminate the contract for the sale of the lot by giving a notice (a termination notice) to the seller terminating the contract.

    (3)The termination notice may be given at any time before settlement of the contract for the sale of the lot.

What Are the Requirements for Termination?

Section 104 sets out two distinct scenarios where buyers can terminate their contracts.

Scenario 1: No Disclosure Provided

The first scenario is straightforward.

If the seller fails to give you a disclosure statement or prescribed certificate before you sign the contract, you can terminate. There's no need to prove anything else – the seller's failure to provide the required documents is enough.

This might happen when sellers or their agents aren't aware of the new disclosure requirements, or if they're trying to rush through a sale without proper documentation.

Scenario 2: Inaccurate or Incomplete Disclosure

The second scenario is more complex but likely to be more common.

You can terminate if the seller provides disclosure documents that are inaccurate or incomplete, but you need to satisfy three specific requirements:

First, the disclosure statement or certificate must be inaccurate or incomplete regarding a “material” matter affecting the property at the time it was given to you. We're not talking about minor clerical errors here – the issue needs to be significant enough to be considered "material." No doubt what is (or isn’t) material is going to be well-trodden ground in the coming years as the section is tested in Court.

Second, you must not have been aware of the correct state of affairs when you signed the contract. If you already knew about the problem despite the incorrect disclosure, you can't use this as grounds for termination. This will inevitably be a question of evidence, probably involving what an agent did (or didn’t) say to you during negotiations.

Third, you need to demonstrate that if you had known the truth, you wouldn't have signed the contract in the first place. This is about showing that the undisclosed or incorrectly disclosed matter was significant enough to influence your decision to purchase. To some degree this relates to the idea that the error was “material” in the first test.

When Termination Rights Don't Apply

There's an important limitation to these termination rights. Section 104 doesn't apply if another Act already provides consequences for the seller's failure to disclose or for providing inaccurate information. If that other Act gives you alternative remedies, you'll need to use those instead.

However, the fact that failing to disclose something might be an offence under another Act doesn't prevent you from using Section 104 rights – there needs to be a specific consequence or remedy provided by that other Act.

Timing Your Termination Notice

If you meet the requirements for termination, you can give a termination notice to the seller at any time before settlement of the contract. This gives you flexibility to terminate even after you've signed, as long as the property hasn't settled yet.

The notice needs to be a formal termination notice – a casual conversation or complaint isn't enough. Make sure your termination notice clearly states that you're terminating the contract under Section 104 of the Property Law Act 2023.

Never ever terminate a contract without getting legal advice from your real estate lawyer first.

A Practical Example

Let's say Sarah is buying a house. The seller provides a disclosure statement as required.

However, the disclosure statement fails to include a notice the owner has been given a notice by the local council that they are required to move their shed 5 metres away from the boundary, and does not provide a copy of that notice.

To do the work would cost Sarah more than $20,000.

Sarah only discovers this information in passing when the agent makes an off-hand comment during an inspection. She wasn't previously aware of the notice, and she definitely wouldn't have proceeded with the purchase if she was because she does not have the money to comply with the notice.

In this case, assuming attempts at negotiation fail, Sarah could arguably terminate under Section 104 because:

• The disclosure was incomplete regarding a material matter (in this case the “material” nature of the disclosure is partially due to its heavy cost);

• She wasn't aware of the correct situation when she signed;

• She wouldn't have signed if she'd known about the notice and its requirements; and

• She's giving notice before settlement

  
  

The notice is likely a material matter because it represents a substantial financial obligation that would affect any reasonable buyer's decision to purchase.

Key Takeaways for Property Buyers

Section 104 provides valuable protection for buyers, but it's not a get-out-of-jail-free card.

You still need to do your due diligence and can't rely solely on seller disclosure.

Remember that "material matters" don't include everything – minor inaccuracies in rates amounts or similar details won't likely give you termination rights. The issue needs to be significant enough that it would reasonably influence a buyer's decision.

Documentation is crucial. Keep copies of all disclosure documents you receive, and document the timing of when you received them. If you discover inaccuracies, gather evidence about when you became aware of the correct information and how it would have affected your decision.

Always get legal advice before exercising termination rights. While Section 104 provides clear grounds for termination in appropriate cases, you want to ensure you meet all the requirements and follow proper procedures.

Key Takeaways for Property Sellers

If you want to minimise your risks, then ensure your disclosure is done properly and read carefully.

As a seller, you should err on the side of treating everything as “material” – if there’s a spot for it in the disclosure statement or its listed in the regulations, then disclose it and ensure you’re on top of the answers and not just making assumptions (remember – it doesn’t matter how hard you tried to get the answers right, if they’re wrong then that’s enough to put you at risk).

Protecting Your Property Purchase

These new termination rights represent a significant improvement in buyer protection, but they work best when combined with traditional due diligence. Continue to order your own searches, inspections, and reports even when sellers provide disclosure documents.

Section 104 is there to protect you when sellers fail to meet their obligations, but the strongest protection comes from being an informed buyer who understands both your rights and your responsibilities in the property purchase process.

If you're concerned about disclosure issues in a property transaction, speak with a property lawyer who can assess your specific situation and advise on the best course of action. Understanding these rights is the first step, but getting proper legal advice ensures you can exercise them effectively when needed.