Special conditions in Queensland contracts: subject to sale, due diligence

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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The standard contract used for Queensland home sales is the same document in every transaction. The printed terms that deal with the deposit, finance, inspections, settlement and default do not change from one sale to the next. What changes is the reference schedule at the front, where the price and dates are filled in, and the special conditions at the back, where the buyer and seller write down anything the printed terms do not cover.

That last section is short on most contracts and long on some. It is where a buyer who has to sell first makes the purchase depend on that sale, where an investor asks for time to examine a property, where a seller reserves the right to stay on for a fortnight after settlement. It is also where the balance of a contract can shift without either party fully noticing, because a special condition overrides the standard terms wherever the two conflict.

This guide explains how special conditions fit into a Queensland contract, who should draft them, how the most common ones work, what every condition needs to say to be workable, and what a special condition cannot do. It describes general practice and the published guidance of the Queensland Government, the Queensland Law Society and the REIQ. The effect of any particular clause depends on its exact words.

Where special conditions sit

The contract published by the Real Estate Institute of Queensland and the Queensland Law Society has three layers. The reference schedule records the particulars. The standard conditions set the rules. The special conditions modify or add to those rules for one sale only.

The Law Society's instruction to its members about the standard contracts is that any modification should be made by adding special conditions, not by altering the standard terms directly. The reason is practical. Everyone who handles the contract afterwards, the other side's solicitor, the lender, a court if it comes to that, can assume the printed terms are the published ones and look in a single place for the changes.

The Queensland Government's home-buying guidance adds the rule that makes this section matter to buyers and sellers. A contract can be made conditional on events such as finance approval, satisfactory inspections or the sale of the buyer's current property, but the buyer must check that each condition actually appears in the contract when it is signed. A condition that was discussed and not written down has no legal force.

Two of those three examples already have a home in the standard terms. Finance is clause 3 and building and pest inspection is clause 4, each switched on by filling in a date in the schedule. The third, the sale of another property, has no standard clause. It exists only if someone writes it as a special condition.

Who should write them

Special conditions are legal drafting, and the industry's own guidance is clear about who should do it. When the REIQ released a new edition of one of its contracts in 2023, its legal counsel wrote that standard conditions may need to be tailored through special conditions drafted by legal practitioners, and that agents should refrain from drafting special terms of the contract. In the same note the REIQ said special condition annexures, including one for due diligence, would be made available with that contract, which is one reason similar wording turns up across many deals.

The Queensland Law Handbook, published by Caxton Legal Centre, gives the buyer's side of the same advice: buyers should scrutinise any special conditions added to a contract and get specialist advice straight away if they do not understand what a modification means.

None of this is a criticism of agents, who are usually the people in the room when the deal is struck and the terms are agreed. It reflects what special conditions do. A clause of four lines can remove a seller's warranty, create a right to terminate or decide who loses a deposit, and the standard contract's cooling-off period, five business days under Queensland Government guidance, is a short time in which to discover that a clause does not say what one party thought it said.

Subject to the sale of the buyer's home

The most familiar special condition is the one that lets a buyer who has not yet sold make an offer anyway. The purchase is made conditional on the buyer's existing property being sold.

These clauses come in two broad forms, and the difference is large. In the first, the buyer's property is not yet under contract. The condition gives the buyer until a stated date to find a purchaser and sign an unconditional contract, and often a further date by which that sale must settle. In the second, the buyer has already sold and is waiting for settlement. The condition makes the new purchase depend on that existing contract completing by a stated date. A seller is taking much less risk in the second case than the first, because the buyer's sale already has a purchaser, a price and a date.

Either way, the seller is being asked to take the property off the market for a result nobody at the table controls. The usual trade is a clause allowing the seller to keep marketing the property. If another acceptable offer arrives, the seller can give the first buyer notice, and the buyer then has a short period fixed by the clause either to waive the sale condition and proceed unconditionally, or to let the contract end and take the deposit back. Whether a contract has such a clause, and how long the notice period is, are matters of negotiation.

A worked example shows how the dates interlock. The figures are illustrative. A buyer signs on day 1 with a condition that their own home be under an unconditional contract by day 30 and that its settlement occur by day 60, with the purchase to settle the same day. If the buyer's home is still unsold on day 30, the condition has failed and the clause decides what happens next: typically either party may end the contract and the deposit is returned. If the home sells on day 20 but its buyer needs finance until day 40, the home is under contract but not unconditionally, and on a strict reading the condition has still not been met on day 30. The lesson is that a subject-to-sale clause is really two or three deadlines, and each needs a date.

Chains of dependent sales have also featured in the debate about seller disclosure. Writing in the Queensland Law Society's journal in April 2026, Professor Sharon Christensen noted that the risk of dependent sales cascading when one fails predates the disclosure laws; what the laws do is bring the underlying problems to the surface earlier.

Due diligence clauses

A due diligence condition gives the buyer a period after signing to investigate the property and, if not satisfied, to terminate. It is common in commercial and development sales and appears in residential contracts mostly where the buyer is an investor or the property is unusual: a large block with subdivision potential, a house with a granny flat of uncertain approval, a rural residential lot.

The scope is whatever the clause says. A broadly drafted version lets the buyer end the contract if, in the buyer's own discretion, the enquiries are not satisfactory. From the seller's side that is close to an option: the property is tied up for the period and the buyer can leave for almost any reason. A narrower version lists what may be investigated, such as council approvals, flood mapping or the body corporate's records, and limits termination to an adverse finding on those matters.

Three things distinguish a due diligence clause from the standard building and pest condition in clause 4. It is not tied to written inspection reports. It can cover matters no building inspector examines, such as planning and title. And it has no standard wording, so its deadline, its notice requirements and its test of satisfaction all have to be supplied by the drafter.

Due diligence also fills a gap the disclosure scheme leaves open. Since 1 August 2025 a seller must give a disclosure statement and prescribed certificates before the buyer signs, but the Queensland Government's guidance is explicit that the statement does not cover a building's structural soundness, the property's flooding history or past building and development approvals. A buyer for whom one of those is decisive has to protect the position another way, and a tailored condition is one of the ways.

Changing the standard conditions

Many special conditions do not add anything new. They adjust a standard term.

Deposits are a frequent subject. The schedule allows for an initial deposit and a balance, and special conditions are used when the parties want something else, such as several instalments. The care needed is illustrated by a 2025 Supreme Court decision summarised for the REIQ by Carter Newell Lawyers, which concerned a $3,264,000 contract with a deposit payable in three tranches under special conditions. One instalment was paid two days late, the sellers' replies to the buyers suggested they were content, and the court later held the sellers could not treat the contract as ended. Each additional payment date in a special condition is one more deadline for the standard contract's strict rule about time to attach to.

Settlement dates are another. The standard terms described by Bradley Bray Lawyers in their summary of the 2022 editions already let either party extend settlement by up to five business days by written notice. Parties who want a longer or more flexible arrangement, a settlement date that floats with the completion of another sale, for example, need a special condition to create it.

The seller's warranties are a third, and the least visible. The Queensland Law Society's seller disclosure FAQs for practitioners point out that some of the contract's warranties are wider than the statutory disclosure form: clause 7.7(1)(b), on transport infrastructure proposals, applies whether or not the seller has received a formal notice, and clause 7.4(1)(e) and (f) reach circumstances that may lead to a future contaminated land classification. The FAQs note that a seller who is not in a position to give those warranties can delete them by special condition. A buyer reading the back pages should therefore look not only for what has been added, but for what has been taken away.

Conditions about the property itself

A further group of conditions deals with the physical property and its occupation between contract and settlement.

Repair conditions require the seller to fix something identified at inspection before settlement. They work best when they say what is to be done, to what standard, by whom and how completion will be shown, for instance by an invoice from a licensed tradesperson. A clause requiring a seller to fix the roof leaves room for an argument on settlement day about whether a patch counts.

Early access and early possession conditions let a buyer in before settlement, to measure, to store furniture or occasionally to move in. Because the Queensland Law Handbook explains that risk in the property passes to the buyer from 5pm on the first business day after the contract is made while ownership stays with the seller until settlement, a clause putting the buyer physically in the house during that period needs to deal with insurance, damage and what happens if the sale then falls over.

The reverse arrangement, where the seller stays on as an occupier after settlement, raises the same questions from the other side. Where a property is sold with a tenant in place, the current edition of the residential contract has its own tenancy schedule, added in 2025 according to the Law Society's journal, so special conditions are needed only for whatever that schedule does not cover.

Conditions that give the seller a way out

Special conditions are often thought of as buyer protections. Some run the other way, and a Supreme Court ruling of 15 June 2026 shows how they are read.

The case, [2026] QSC 130, concerned land at Caloundra sold for $2,850,000 by a mortgagee's agent to Reliance Developments Sunshine Coast Pty Ltd, one day after the seller had treated an earlier contract with another company as terminated. The contract contained a special condition about the ending of that earlier contract, and another, Special Condition 10.2, allowing the seller to terminate if it was unable to provide a transfer capable of immediate registration, including because of a caveat. The earlier buyer disputed its termination and lodged a caveat. On the extended settlement date the seller ended the Reliance contract under the special condition.

The court was deciding only whether Reliance's own caveat should stay on the title until trial, and held that it should. In reaching that view Justice Morrison found it arguable that the special condition did not exclude an implied duty on the seller to cooperate so that the buyer received the benefit of the contract, for example by extending time instead of terminating. An entire agreement clause, another special condition, did not prevent that argument, because under Court of Appeal authority such a clause does not stop a term arising by necessary implication.

The decision is interlocutory and the final outcome is still to come. Its usefulness here is as an illustration. A condition that appears to give one party a clean exit is read alongside the rest of the contract and the general law, and may not operate as mechanically as its words suggest.

What every condition needs to say

Whatever its subject, a workable condition answers the same questions. Disputes about special conditions are, more often than not, disputes about which of these the drafter left out.

The fourth item is the one most often missed. A condition that says the contract is subject to an event by a date, and stops there, does not say whether the contract ends automatically when the date passes, whether either party may end it, or whether it carries on until someone acts.

It also helps to know who a condition is for. A condition included for the benefit of one party can generally be waived by that party, which is how a buyer under a subject-to-sale clause is able to go unconditional when the seller produces a competing offer. A well-drafted clause says so in terms.

What a special condition cannot do

The parties' freedom to rewrite the contract has limits set by legislation.

The clearest concerns seller disclosure. The REIQ's guidance to agents on the scheme is that a buyer's rights under section 104 of the Property Law Act 2023, to terminate before settlement if the disclosure documents were not given or were materially inaccurate, cannot be waived through the terms of the contract. A special condition in which the buyer acknowledges receiving complete disclosure, or agrees not to rely on any error in it, does not remove those rights. The statutory exceptions, such as the waiver available on sales above $10 million, operate through the Act's own process and not through a clause.

Cooling-off works in a similar way. The Queensland Government's guidance says a buyer can give up or shorten the five-business-day period, but describes that as something done by the buyer giving written notice to the seller or the seller's agent. It is a step the buyer takes, with its own formalities, and the warning about the period has to appear above the buyer's signature regardless.

A special condition also cannot fix a failure that happened before it was written. If a prescribed certificate was not given before the buyer signed, wording added to the contract afterwards does not cure the omission.

How conditions end

A condition leaves a contract in one of three ways. It is satisfied, and the contract moves on. It is waived by the party it protects. Or it fails, and the contract is ended under the clause.

Each of those is normally marked by a notice, and the standard contract's approach to time carries across. Law firm Attwood Marshall, writing in April 2026 about deposits, described time as being of the essence in the standard contract, and the same strictness applies to dates in special conditions unless the clause says otherwise.

What the parties do matters as much as what they write. In a Supreme Court case reported by Real Estate Business in March 2026, a buyer paid a deposit in instalments over two days after an agent replied by text that this was acceptable; the court held that the agent had no authority to extend the deadline for the seller, and the buyer lost a $98,500 deposit. In the 2025 case described earlier, friendly messages from the sellers themselves had the opposite effect and kept the contract alive. Any change to a condition, a later date, a waiver, an extra few days, is safest made in writing between the parties or their solicitors.

A special condition is a small contract inside the contract. It needs its own event, its own deadline and its own answer to the question of what happens if nothing is said.

Special conditions are what make one standard document fit thousands of different sales, and most of them do their work without anyone thinking about them again. The ones that cause trouble tend to share a profile: written quickly, by someone other than a lawyer, with a date missing. Reading the back pages first, and asking what each clause does when its deadline arrives, is the simplest protection either side has.

Kooky, from Shaka

Kooky edits Queensland Estate and builds Shaka, the payment router he made for Queensland property professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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