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Kooky
Builder of Shaka, the payment router that pays every agent their commission on closing date.
About Kooky and Shaka →The removalist is booked for nine the next morning. The buyer has taken the day off, the seller's furniture is already in a truck, and at ten past three the phone rings: settlement will not happen today. For the people in a sale this is the moment the process stops being abstract. The questions come quickly. Is the contract still alive? Who is at fault? And who pays for the truck?
The legal framework for moving a settlement date, including the phrase "time is of the essence" and the extensions the standard contract and the Property Law Act 2023 allow, has its own guide. This one stays with the practical side of a late settlement: why delays happen, what the afternoon looks like, what each kind of delay costs and who bears those costs. It is based on the standard contract published by the Real Estate Institute of Queensland and the Queensland Law Society in its first edition of August 2025, and on the default interest rate the Law Society publishes. It describes the general position, and the outcome in any one sale turns on its own contract and facts.
Standard contract (08/25), clauses 5.1, 6.2 and 9.9; Queensland Law Society interest rates page, rate applying from 1 December 2025 until revised.
Why settlements run late
An electronic settlement needs every participant to be ready at the same time: two representatives, usually two lenders, and the system that connects them. A delay generally comes from one of five places.
The most common is the incoming lender. Loan documents returned late, a condition of approval not yet ticked off or a settlement that was never booked can leave the largest sum in the transaction unavailable on the day.
Related readARNECC briefs industry on tighter rules for settlement platforms and firmsThe second is the outgoing lender. The seller's bank has to calculate a payout and be ready to release its mortgage. If it is not, the seller cannot give clear title, whatever the seller's own state of readiness.
The third is the buyer's own money. Funds sent by bank transfer on the morning of settlement may not be cleared in the account from which they are to be drawn.
The fourth is the workspace. Because any participant can still change a figure, a late adjustment by one of them can remove the signatures of the others shortly before the booked time.
The fifth is new. Since 1 July 2026 agents, conveyancers and lawyers have had to complete customer identity checks under the federal anti-money laundering regime, and AUSTRAC's guidance requires any delayed check to be finished at least three days before the settlement date as first agreed. A file that is still missing identity documents in settlement week has a problem that did not exist a month ago.
Very few delays are anyone's bad faith. They are failures of coordination, and the contract is written with that in mind.
The afternoon it happens
Under clause 5.1 of the standard contract, settlement must occur by 4pm on the settlement date. The representatives may have booked an earlier time, but the contract treats their agreed time of day differently from the date: clause 6.1 makes time of the essence except in relation to an agreed time of settlement before 4pm. Missing a 2pm booking is an inconvenience. Missing 4pm is a legal event.
Related readAUSTRAC guidance: delayed checks due 28 days in, or 3 before settlementThe hours between matter for that reason. Once it is clear that one side will not be ready, the representative for that side has a decision to make before 4pm, and often needs the client's instructions within minutes. The choices are to ask the other side to agree to a new date, to give notice of an extension under the contract, or to do neither and be in default at four o'clock.
For a buyer or seller, the practical demands of that afternoon are simple and urgent: answer the phone, give clear instructions, and do not act on assumptions. A buyer should not collect keys or start moving in. A seller should not hand anything over. Nothing changes hands until the representatives confirm that settlement has occurred.
Three kinds of lateness
What a delay costs depends almost entirely on which of three categories it falls into. They look the same from the footpath, since in each case the keys are not handed over, but the contract treats them very differently.
| Kind of delay | Other side's consent | Default interest | Risk to the contract |
|---|---|---|---|
| Extension by notice (clause 6.2) | Not needed | None | None, if the new date is met |
| Extension by agreement | Needed, on agreed terms | Only if agreed | None, if the new date is met |
| Default | None given | Payable by a late buyer | The other party may affirm or terminate |
The distinction turns on what the contract means by the settlement date. Its definition says the settlement date is the date in the reference schedule as extended by an extension notice under clause 6.2, by agreement of the parties, under clause 6.3 or under three sections of the Property Law Act 2023. When a date is validly extended, the new date is the settlement date. Nobody is late until that date passes.
What an extension by notice costs, and does not
Clause 6.2 allows either party to extend the settlement date by written notice given at any time up to 4pm on the settlement date, naming a new date no more than five business days after the scheduled settlement date. More than one notice may be given, within the same five-day ceiling, and time remains of the essence for the new date.
Related readElectronic conveyancing in Queensland: how a settlement completesThe cost of using it, under the contract, is nothing. Clause 9.9 charges interest on any amount payable under the contract that is not paid when due. After a valid extension, the balance of the price is not due until the new date, so no default interest accrues. Clauses 9.7 and 9.8 allow a party to claim damages for loss caused by the other's default, and a party exercising a right the contract gives is not in default. The other side, in short, has no claim under the contract for the cost of its truck.
That can feel unfair to the party who was ready. A seller who has moved out and must wait three more days for the money, or a buyer whose removalist charges a rebooking fee, bears that cost personally. The clause was a deliberate trade when it was introduced in 2022: each side accepts the risk of a short delay by the other in exchange for protection against losing the whole contract over a bank's bad afternoon.
A valid extension is not a default
When settlement is extended by notice under clause 6.2, the new date becomes the settlement date. No default interest runs and no damages are payable for the days in between. Each side carries its own costs of waiting, however blameless it was.
Agreed extensions and the price of consent
Beyond five business days, or where no notice was given in time, a delay needs the other party's agreement. Agreement is a negotiation, and the party being asked is entitled to set a price.
The usual price is interest. A seller asked to wait a fortnight will commonly agree on condition that the buyer pays interest on the balance for the period of the extension, often at the contract's default rate, and sometimes also the seller's legal costs of the variation. A buyer asked to wait by a seller may ask for an allowance in return, such as a contribution to storage or temporary accommodation. None of these terms comes from the standard conditions. They are whatever the two sides settle on, and they should be recorded in writing by the representatives, together with a clear statement that time remains of the essence for the new date.
Related readPricing regulator proposes cutting the main settlement fee by a thirdA party is free to refuse. Someone who has arranged another purchase, a lease or a loan around the original date owes the other side no indulgence, and the contract's remedies remain available if the date is missed.
Default: interest by the day
If 4pm passes with no settlement, no notice and no agreement, the party who was not ready is in default. The party who was ready may then keep the contract alive or bring it to an end, a choice with consequences that are set out in the contract's default clause and are best made with legal advice on the day.
Where the ready party is a seller who chooses to keep the sale alive and the buyer settles some days late, the cost is measured by clause 9.9. The buyer must pay interest at the default interest rate on any amount payable under the contract that is not paid when due, from the due date until it is paid, and interest for the period before settlement is payable at settlement. It appears as a line on the settlement statement in the seller's favour.
The rate is the figure written in the reference schedule or, if that box was left empty, the contract rate published by the Queensland Law Society at the contract date. The Society's interest rates page gives that rate as 10.84 per cent a year, simple interest, applying from 1 December 2025 until revised.
A worked example shows the scale. Assume a purchase price of $800,000, a deposit of $40,000 already paid and so a balance of $760,000, with the published rate applying. One day's interest is $760,000 multiplied by 10.84 per cent and divided by 365, which is $225.71. A buyer who defaults and settles three days late pays $677.13. The figures are illustrative.
Related readRuling on settlement network fees slips a month, to 30 OctoberIllustrative calculation: balance multiplied by 10.84% and divided by 365. Rate from the Queensland Law Society, applying from 1 December 2025 until revised.
Two limits on clause 9.9 are worth noticing. It is written for the buyer, because the buyer is the party who owes money; a seller who is late does not pay interest under it, and a buyer's claim against a late seller is for damages. And interest is the smallest of the consequences of default. The larger one is that the other party gains the right to end the contract.
The costs the contract does not see
Interest is the only cost of delay the standard contract puts a number on. The costs people actually feel are usually others.
For a buyer they include a removalist's rebooking or storage fee, extra nights of rent or a hotel, time off work and, where the buyer's own sale was meant to fund the purchase, the knock-on effect on a second settlement. A buyer with a fixed-rate loan may find the lender's rate lock has an expiry date.
For a seller they include continuing interest on the mortgage that should have been paid out, rates and insurance for the extra days, and the cost of delaying a purchase that depended on the sale proceeds.
Who bears these depends on the category of delay. In an extension by notice, each side bears its own. In an agreed extension, the terms of the agreement decide. Only where the other party has defaulted does the contract open a route to recovery, through the damages clauses, which extend to legal costs on an indemnity basis. Even then recovery means making a claim and proving the loss, and for a few hundred dollars most people do not.
Related readOne network or two: where e-conveyancing competition standsClaims against a party's own lender or representative are a separate matter. Whether a bank or a firm that caused a delay should make good a customer's loss depends on its terms and on what went wrong, and is raised through that institution's complaints process, not through the sale contract.
What moves with the date
A new settlement date changes more than the day of the move. Several things have to be redone or rechecked.
The adjustments are recalculated. Rates, water, land tax and rent are apportioned to the settlement date under clause 3.4, so every figure shifts by the number of days of the delay, and the statement is reissued.
Searches may need refreshing. The Queensland Revenue Office says a land tax clearance certificate is valid until 30 June, so a settlement pushed from late June into July needs a new one.
Insurance and utilities follow the date. The buyer's cover on the property should already be running, since the contract puts the property at the buyer's risk from the first business day after the contract date. A seller should keep their own cover until settlement actually occurs.
One thing does not move. AUSTRAC's guidance measures the deadline for a delayed customer check from the settlement date as originally scheduled, so an extension gives no extra time to complete it.
- Confirm the basisNotice, agreement or neither: each representative records in writing how the date was moved.
- Redo the figuresAdjustments, any agreed interest and the lenders' amounts are recalculated to the new date.
- Rebook everyoneBoth lenders and both representatives sign again in the workspace for the new time.
When the system is the cause
Sometimes neither party nor either bank is to blame. A platform, a registry or a payment system can fail on the day.
The contract and the Property Law Act 2023 both make allowance for that, and those provisions are described in the guide to settlement dates and extensions. Two points are enough here. Clause 5.2 says a party is not in default to the extent it is prevented from complying because the other party, or the other party's financial institution, has not completed something in the workspace. And where a failure of the systems themselves stops an electronic settlement, the statute moves the date without either side being in breach. In both cases the cost position resembles an extension by notice: nobody is in default, so each side carries its own costs.
Lowering the odds
Most delays are decided days before the settlement date, and the habits that prevent them are unglamorous.
Loan documents returned the day they arrive give a lender the most time. Identity documents supplied when first requested keep the federal deadline from becoming a settlement-week problem. Funds transferred to the representative's trust account several days ahead are cleared funds on the day. A settlement period chosen to suit the slower lender, with a few days in hand, is less likely to need rescuing.
It also helps to plan for a slip. Removalists, cleaners and leave from work booked with some flexibility cost a little more to arrange and a good deal less to change. A buyer and seller who each know that the other may lawfully take up to five business days more are less likely to be caught with a truck at the kerb and nowhere to unload it.
Under the standard contract a short delay is usually nobody's breach, which means each side usually pays for its own wait.
A late settlement feels like a crisis because so much has been arranged around one afternoon. In most cases it ends a day or two later with the same result, a slightly different set of figures and a story about a phone call at ten past three.
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.
