Ep 76. Contract Questions
In this episode, Michelle is joined by Brenda Gately, licensed conveyancer and founder of Gately Conveyancing. Together, they lift the veil on what really happens behind the scenes of a property purchase — and the contract traps, legal risks and hidden clauses every buyer needs to understand before they sign.
Here’s what you’ll learn from today’s episode:
Why a vendor cannot pull out of a contract — and the rare situations where things get messy
What actually happens if a buyer rescinds during the cooling‑off period or defaults after unconditional exchange
The truth about 5% deposits, why the front page still shows 10%, and what buyers are really liable for
How release‑of‑deposit clauses work, when they’re risky, and why they’re not always as innocent as they look
The sneaky special conditions that occasionally appear — including one Brenda had never seen in 36 years
Why contract reviews are non‑negotiable and the biggest mistakes buyers make when they skip them
What post‑exchange searches uncover (council, water, RMS, Education Department) and how they can save you from major future issues
How undisclosed notices — like road widening or school expansion — can give buyers grounds to rescind
Why agents and solicitors sometimes give different answers, and how a good team can negotiate smarter outcomes
Speakers in today’s episode:
Michelle May - Michelle May Buyers Agents
Brenda Gately - Gately Conveyancing
Follow Us:
Enjoy the show?
Don’t miss an episode, follow via iTunes. If you like it, please leave a review!
Or, find us on the podcast app of your choice, such as Spotify.
This podcast has been produced and edited by Snappystreet Creative
Please note that any views or opinions presented in this podcast are solely those of the speakers, and do not necessarily represent those of any business. These views and opinions are general in nature, and do not take account of your personal objectives, financial situation and needs. Please consider whether it applies in your circumstances and seek professional advice wherever appropriate.
Listen to the Episode Now
Michelle:
Hi, and welcome back to another episode of the Buy Your Side podcast, the property podcast to help you make smarter property buying decisions. Now, 2026, are you ready to purchase? I'm suddenly ready to crack back into it and to that end, I thought I'd share one of my best kept secrets, my secret power, a person I love working with who is one of the best because as I always tell you that buying a property is not something you really can do on your own. You really need a good solid team behind you. One of those people that I love working with is with me here today, Brenda Gately of Gately Conveyancing is someone who has been in the property conveyancing business for a very long time. My clients and I love working with her for her no-nonsense approach, really practical advice, and just incredibly detailed approach. Someone you can truly rely on when it comes to buying a property.
Brenda, it's so great to have you here today.
Brenda:
Thank you for having me, Michelle. It's nice to be here.
Michelle:
Well, Thank you for making the time because I do know you're incredibly busy because we work together on a regular basis. I wanted to have you on this podcast for such a long time. And I've always held back asking you because I know how busy you are, but I managed to make it work. Today I wanted to run you through, from my perspective, the questions that buyers ask me the most, but I first wanted to start off with your journey into becoming the person behind Gately Conveyancing. Tell me how you became a property conveyancer.
Brenda:
So I started working for a very small law firm when I was 21 and I stayed with that firm right up until 2017. So I worked with Graham for 36 years and during that time, I did a lot of his conveyancing. I got my licence and a couple of years before he was due to retire, he suggested I start my own business, which he helped me set up very kindly, and here I am today with my own business.
Michelle:
It's crazy how things happen like that because you and I were talking the other day and it actually turns out that one of my dear clients who's been a client with me numerous times now is his daughter, which you know, is such a small world.
Brenda:
Correct. Yes, a very small world.
Michelle:
And who knew that we had that in common as well and so today, do you tend to work mostly with buyers or, tend to work mostly with vendors setting up their contracts for sale or does that vary on a day to day basis?
Brenda:
It varies. I do both and the good thing is, which I feel very blessed, is I have repeat clients, so someone that's bought a property previously, now wants to sell to move up to a bigger property or downsize. It's a bit of both.
Michelle:
I mean, having had your own business since 2017, that's now, eight years, nine years down the track so that does start to happen, doesn't it? Well, the same with me, actually, repeat clients that have purchased, eight, ten years ago, are now coming back for different circumstances in their life. It might be a divorce, it might be a downsize or an upgrade and things like that. It's lovely to see those people coming back and seeing where they've moved on from, right?
Brenda:
Exactly.
Michelle:
It's good to see them.
Brenda:
It's a good feeling. It makes you feel like you've given them the service that they've wanted and they're happy and you know they're not going to go anywhere else.
Michelle:
Yeah, absolutely. Now, like I mentioned previously in the intro, I do get asked a lot of questions and obviously, as a buyer's agent, I know the stuff that I know. But I'm certainly not authorised to answer questions that move into the scope of conveyancing and property law. As you know, that would be beyond scope as they call it. So what better person than to ask you directly? I sent these questions to you before, so you could have a bit of an idea. But let me start you off with this one, because it is an intriguing one.
Now, after an exchange of contracts, the buyers and vendors have signed the contract, the deposit has been paid. Can a vendor pull out of a contract and what would be the consequences for them?
Brenda:
A vendor cannot pull out of a contract. It's legally binding on the vendor. The purchaser may, if it's cooling off period, but otherwise all parties are locked in.
Michelle:
So after an auction, when there is no cooling off at all, then that's it. You have to transact? Is there sometimes a situation where there may be a little bit of a sneaky, sneaky note in the contract, so to speak?
Brenda:
You do.
Generally, no.
Michelle:
No.
Brenda:
There's not, no and if a vendor does pull out, then the purchaser would probably have to take them to court for specific performance.
Michelle:
Ok and so for the buyer to pull out of a contract, when it is with a cooling off period, typically five days cooling off?
Brenda:
Yes. Typically five days, sometimes we negotiate a bit longer because the banks are a bit slow in giving unconditional approval at the moment. But if the buyer does rescind the contract in that cooling off period, they do forfeit their 0.25% deposit.
Michelle:
Yeah and what happens if they were to pull out of an unconditional contract? So again, the cooling off period has finished, it's locked in now, it's gone unconditional. Or again, when you buy at auction, unconditional exchange of contracts. What happens then to the buyer?
Brenda:
Or the buyer would be taken to court for sure. They would forfeit their deposit and again, the vendor would then take them to court for specific performance and also for damages because if the property market drops and then the vendor can't sell it for that specific price and it's lower, they can seek damages.
Michelle:
Really? Right. Have you seen that before? Does it happen?
Brenda:
Only in the whole time that I was working with Graham, only once.
Michelle:
Once, ok because I have to admit, I've never pulled out of a contract on behalf of my clients or worked with clients that have wanted to, nor has a vendor tried to get out of a contract. I did anecdotally hear a sneaky story once where in a cooling off period the vendor had accepted an offer right so there was an exchange with the cooling off period at the the buyer had paid 0.25 percent deposit as is standard and then the vendor got made another offer by a developer and this developer wanted to buy the whole lot, it was a strata complex and the developer made an offer to the whole complex and it was significantly more than what the vendor was going to be getting from this one particular buyer and so this vendor’s solicitor suggested that they would very sneakily demand the full deposit and that they had till close of business to provide this, otherwise the vendor was going to pull out of the contract, which then allegedly happened because the buyer didn't have enough to scrape together this remainder of the deposit. So that's how they somehow managed to get out of it.
Brenda:
Was that prior to the expiration of the cooling off period?
Michelle:
Yes, so the fable goes, this was by the way, a conveyancing solicitor on one of the social media apps who's, around a lot, that if you are in the cooling off period, the vendor can still request for the remainder of the deposit to be paid.
Brenda:
I don't know if that's correct.
Michelle:
I don't know if that's a little bit of TikTok hyping, scaring buyers out there, but yeah, I've never come across it before.
Brenda:
No, neither have I ever.
Michelle:
No. So I think buyer beware is always right
Brenda:
I'd be interested to know on what basis they could demand the balance of the deposit prior to the expiration of the cooling off period.
Michelle:
Yeah, exactly so you've never heard of this before. I just thought because it was quite a popular TikTok, I thought I'll ask someone who would know. And you don't think that's the case unless there's a legal basis in some other way.
Brenda:
Yeah, no, I don't believe that that is the case.
Michelle:
No. Ok, that's good because when I heard that, I was like, oh, my gosh, there's another little sneaky thing that we need to be aware of.
Brenda:
That would be happening all the time, wouldn't it?
Michelle:
Right I know, no ok
Brenda:
Yeah, that doesn't sound right to me
Michelle:
No, you and I both have never heard of it so this is very highly unusual and so I would take it with a grain of salt perhaps. Fantastic no that's good to know so consequences for the buyer of pulling out
Brenda:
You can.
Michelle:
That brings me to the pulling out when you have your exchange of contracts and so with cooling off is the 0.25 typically but when you're a buyer you can actually negotiate for an unconditional contract for that deposit to be less than 10% right?
I always say to my buyers as well when it comes to signing the contract, that the front page will always reflect a 10% deposit, even if you have negotiated 5%.
Brenda:
That is correct, because if you, as a purchaser, default on that contract, regardless of whether the 5% deposit has been agreed to, you are still liable for 10% if you default. So if you default in the contract, the vendor can still claim a 10% deposit from you.
Michelle:
Wow. So that's something to be aware of, everybody. Even if you think, okay, 5%, you could still be in it for 10% if you do change your mind and pull out for whatever reason.
Brenda:
If you don't complete, yes.
Michelle:
Yes, exactly.
Brenda:
Or you default in the contract, yes.
Michelle:
And we all know how much money goes around, even, for the smallest studio flats, how much money you need. That's a significant amount of money.
Brenda:
Exactly, yes and there is always a special condition in the contract that reflects that. It will say regardless, it says, you know, the deposit is to be paid in part payments. It'll be 5% on exchange balance on settlement or default of the contract.
Michelle:
Yes and from my experience, I'd love to hear your view on that, 5% deposit is becoming almost the norm in many cases.
Brenda:
It is. Yes, prices are so high, it's a struggle for people to save that 10% deposit.
Michelle:
Absolutely and obviously, this is the amount that you need to have in your bank account ready to pay on exchange of contracts. It's not nothing to do with how much you're borrowing and the 5% deposit scheme. Let's just make that clear. You need to have that in your bank account with the remainder due once you settle. Now, I imagine that much like myself, you work with the broad spectrum of buyers and vendors out there, different budgets, different types of properties, areas, etc. Is there a common theme when it comes to the most common mistakes that buyers make when buying a property when it is from your perspective as a conveyancer?
Brenda:
Yes, one of the common mistakes is not getting the contract reviewed first.
You know, they are exchanging without a cooling off period and then they haven't but they haven't got finance approval. That's a big mistake and a common mistake too because they rush in.
Michelle:
Yes so you have people coming to you after they've signed a contract
Brenda:
I've had people come to me after they've bought at auction.
Michelle:
No that's okay and how did that conversation go?
Brenda:
Yes. Not a lot, not really, but it does happen.
Well, lucky for them, you know, they were well-equipped to get their finance and it wasn't going to be an issue, but it's still very risky.
Michelle:
Yeah, of course
Brenda:
It's a risky thing to do, to walk past a place on a Saturday when the auction's going to be in half an hour and go, oh, let's go and have a look at this place. And next thing you know, they've bid on it and then they've bought it.
Michelle:
And also when you sign a contract, it'll be predominantly written in the Windwall's favour. So, I mean, that's the whole point of having someone like Brenda as a buyer represent you to review the contract.
Brenda:
Correct. You need to review the contract, you need to get a pest and building or a strata report. You need to work out what the costs are, what your stamp duty is likely to be.
Michelle:
Yes, absolutely
Brenda:
If you've borrowed money, you know what your repayments are. You really need to do your homework beforehand and know what your budget is and know about the property and don't just go, I like this property, this is exactly where I want to be and just go and buy it on a whim.
Michelle:
Yes, absolutely, I obviously always have a look at the contract to see if I see anything, I'm not the expert, but I have seen a few of them to know that there are always these recurring clauses that people tend to put in, and one of them, for example, would be the release of deposit clause. Can you can you talk our listeners through what that means and what the consequences could be if you don't have that removed, for example?
Brenda:
Basically what that means is the vendor is allowed access to the deposit that you've paid on exchange to use either for the purchase of another property as their deposit or the stamp duty on another property. It's quite common.
They're pretty much in all the contracts. Everyone asks for it to be removed. Whether it gets removed is another thing. If that is released, and then the vendor defaults, you then have to try and get that to deposit back, which will be a long court process.
Michelle:
Is it a myth or is this again, you're the person in the know, I'm just going to put it out there. The release of the deposit clause, you're saying they can use it for the purchase of a property or stamp duty or whatever, but does it have to be specified within that clause? but what If it's just a release of deposit clause, could they in theory go out on a cruise to the Caribbean with it?
Brenda:
If it's not specified that it's for the purchase of another property, yes
Michelle:
Yes, so that would be tricky
Brenda:
It would be very tricky and I always, if it is for the purchase of another property, I always want to see the front page of that contract just to make sure.
And the deposit is only then to be paid to the real estate agent's trust account.
Michelle:
Also, Brenda, I think, and you tell me if I'm correct in saying this, I think a lot of contracts are created by the vendor solicitors without necessarily asking the vendor's opinion or you know, do you actually need a release of deposit clause? Do you actually want the X amount?
Whatever the case may be, they just might just create this contract going, yep, that's that'll do.
Brenda:
That's our standard special conditions and that's that's in there.
Then the potential purchaser might say, we want that removed. You check with your client, the vendor, if they require it and then if it's agreed to remove it, then it's just a matter of striking it out.
Yes, but one other tricky special condition I came across a couple of weeks ago for the first time was that the vendor, so I'm acting for a purchaser, I'm reviewing the contract, and the vendor had penalty interest clause in there if the purchaser was late for on this property, but they also were expecting the purchaser to pay any penalty interest that they were going to incur if they were late on their own purchase, so they were double-dipping.
Michelle:
Is that so and you said that was the first time you'd come across that?
Brenda:
Yes, I'd never seen that before.
Michelle:
I mean, if you were the vendor and you'd already committed to another property and your buyer is late, it's worth a try.
Brenda:
It's worth a try, but it's double-dipping in my opinion because you are getting more money from them.
Michelle:
True, but it's interesting you can't ever assume that a contract is a contract right? there's going to be little bits that vary all the time
Brenda:
That's right. Thankfully they agreed to delete it. So we were fine.
Michelle:
That's good. Now, what's one thing you and I've worked on, so many cases together, and sometimes you will put the request forward to the vendor solicitor, whether that's a release of deposit clause or tweaking percentages, late penalties, fees, and whatever. Then the vendor solicitor will come back to us, going, no, no no, not agreed, not agreed, not agreed.
Having a team on board, as we are, one of the things that I want to put out there to our listeners is that don't take that as a given either, right?
There's other ways to skin a cat.
Brenda:
That's right, yes
Michelle:
So from my experience, when we see those come back, I'll always say to Brenda, hey, I'm just going to talk to the agent about this because the vendor might not even know what those responses were.
Brenda:
Correct, the vendor solicitor may not run them by their client and just go, no, we're keeping that in there and nine times out of ten, the agent can word it a different way to the client and get it removed or get it amended.
Michelle:
Also from their perspective, they want to drive competition to the sale of the property and the more they say no, the real chance is that those buyers are not going to show up at auction or they're not going to put their hand up and make an offer. So they've got to be commercially savvy for them from that perspective as well. How likely is it that this person A is going to win the auction and B, you know how much it’s actually going to affect me if I do say yes to those contract change requests?
Brenda:
That's right and, like most of the time, the requested amendments from each prospective purchaser is going to be the same.
Michelle:
Yes, exactly, so my question to you is, because this is another thing that I don't know much about, but when your buyer has exchanged contracts, they're unconditional and all that kind of stuff, then something happens that you still look after the clients with, something called searches that happen after exchange. Could you explain to me what they are and why they're important?
Brenda:
We do searches for council and water and that is for us to ascertain what is owing on the property because then on settlement we do adjustments and work out how many days, say for instance with council, how many days in the year the vendor is going to own the property, how many days the purchaser is going to own it, and the purchaser pays the portion that they are going to own. So they're called adjustments. We do that for council, water, strata titles
We also do searches with for example Energy Australia, the roads transport and education department and that is safe for roads to ascertain whether the RMS has any intentions of doing any road widening and they might want to acquire that property.
So that's why we do that. Should we also ask that question prior to exchanging as well if the vendors received any notices to that effect? But we just don't.
Michelle:
So something like West Connex, for example, when the substratum was acquired by Transurban, those people all got letters to say, hey, nice to meet you.
Brenda:
Yes
Michelle:
We're going to appropriate the air, the soil underneath your house and we're going to dig a nice big tunnel.
Brenda:
Yes, that’s correct and say for example the education department, if there's a school nearby as to whether they might want to know, you might be right next door to the school, the school might want to buy that property to expand. So, whether you've received a notice to that effect or if they haven't or they've missed it, then we do a search to ascertain whether that is going to be the case.
Michelle:
So is it just public schools that can, or even private schools have the right to decide that they're going to buy the property next door to expand their campus?
Brenda:
Not necessarily. No. With the public schools, yes, that's a government thing. With a private school, they could only buy it if the property went up for sale.
Michelle:
Ok
Brenda:
Yes, sorry, you are correct
Michelle:
So make that distinction that if it's a public school, New South Wales public school, whether that's a high school or a primary school, they could actually decide that there are too many demountables, we need more, there are too many kindy kids, and we're going to take your house.
Brenda:
Yes
Michelle:
Wow, that's massive, isn't it? I didn't realise that that was the case. If you love living next to that kid's playground and the peace and quiet that you get in the school holidays, be mindful.
Brenda:
Well, it doesn't necessarily mean it's going to happen, but if they've got an interest and they're looking at it, then you should know.
Michelle:
Ok so you do those searches and say you do find that, the education department has their eye and the vendors have been notified, which they didn't disclose before you exchange contracts. What happens then?
Brenda:
If it's not being disclosed, then that gives you the opportunity to rescind or if you don't want to rescind, there's a possibility of renegotiating the price.
Michelle:
Would the vendor always have to know if it shows up in your searches after exchange, so this is just to make sure that they're not being caught out if they're not thinking they're going to get away with it.
Brenda:
That's right and if they have received a letter, then that should be disclosed in the contract and attached to the contract.
Michelle:
So that would be then falling under what we call material fact?
Brenda:
Yes. It's It's disclosure.
Michelle:
Disclosure and then following on from that, would that then mean that the agent would have to disclose that during the campaign as well?
Brenda:
If the agent knows about it
Mihelle:
Or not? Well, this is where we get these agents that go, don't tell me anything, because if I don't know something, then I can't tell anybody, right?
Brenda:
Yes.
Michelle:
So again, if you're listening and you're thinking, I don't need to have a contract review, they're all the same. These are the hundredth reasons why that's not the case.
Brenda:
Correct. Yes
Michelle:
Wow, there's so much to a contract, right? There's so many different aspects that you need to look at, but I think searching is really intriguing to me because it happens after the exchange, and that doesn't then necessarily mean that you think you've bought a great place and then you know your convenience solicitor finds out actually bad news.
How often does that happen? Do you have a gauge on that?
Brenda:
It's never happened. I've only had one contract where it's actually been disclosed prior. It was part of the contract. So the client had exchanged with the cooling off period so we were able to rescind. But I've never actually had one where it's come up that the education department or RMS have an interest in the land.
Michelle:
Afterwards, I think for us when when all that west connect was going down we were taking a very keen interest in the unfolding of that project because you know they were doing that quite stealthily phase by phase and nobody knew where the next part of the map was going to take the tunnel right and so we did find houses that did have those letters going it's us we're going to build or we're going to make a tunnel underneath and from our perspective that was a no-go, we were like we're not moving forward on that property particularly because with that construction they offered those owners a dilapidation report and if for example that letter never arrived because it was an investment property for example and it was physical letters in the post they never got a dilapidation report done so then there was no right of recourse because trans-urban would go, well those checks could have been there before we started
Brenda:
Oh, my goodness and you've got to wonder how many times they attempted to contact the owners.
Michelle:
Yeah, well, from my understanding, it is a physical letter in the post. I mean, seriously that's why I think it's very important to just look at your purchase from all angles because there's so much money involved.
If you get it wrong, it could be a real issue.
Brenda:
Correct. Look, and it's important to ask those questions even before you exchange.
Then, after the exchange, we do the searches just to make sure. They're not cheap by any means. I think the searches at the moment are about $700 for a set of..
Michelle:
Really?
Brenda:
Yes
Michelle:
That's another cost to the buyer.
Brenda:
Another expense, yes, so they've got to take that into consideration as well, when they're doing their budgets of what they've got to spend.
Michelle:
But not one that you'd want to skip for $700. You'd want to know.
Brenda:
I don't believe so.
Some people don't want to do it. You’d have to say to them, well, I need you to put that in writing to me that you don't want me to do these searches because I'm suggesting that you do.
Michelle:
Absolutely. I can imagine. Well, thank you, Brenda. It's been an absolute pleasure having you on and seeing you.
Brenda:
It's been fun.
Michelle:
Yeah, well, um let's do it again, shall we?
Brenda:
Well, I feel like we could talk for quite a long time. So much more to talk about.
Michelle:
We always can. That's because we're a little bit obsessed with what we do and we just find all these interesting anecdotes all the time.
Michelle:
So I would like to thank you...
Brenda:
I love what I do
Michelle:
That's good. It's great, I think you could tell as well, like in our interactions as well, and the way you communicate with the clients and it's, it makes a huge difference, that someone has a care and a passion for, for what they're doing, and you've been doing it, a lifetime like me, and it still gets us excited, which is good, which is good.
Brenda:
Yes, exactly and it's good for people to have a good team.
Michelle:
Absolutely sometimes people come to me and they go, I've got this solicitor, this conveyancer and it was my neighbour’s grandmother's butcher, in Victoria or wherever and I’m like, are they going to be as good as Brenda? I don't know. Let me see.
Brenda:
Never.
Michelle:
No, the answer is no. That's right. Well, Brenda, thank you so much for coming on. If people want to get in touch with you what's the best way to do so?
Brenda:
Okay, so my office number is 02 8815-8148. My email is brenda@gatelyconveyancing.com.au.
Michelle:
Now, you're also on socials, so check Brenda's socials out as well.
If you have any more questions for Brenda or myself, you can always reach out via the email hello@buyourside.com.au. I'll make sure Brenda comes back to answer them all and in the meantime, follow us on social media, TikTok, Instagram, Facebook, and everything else. Share it with your mates who might benefit from all these amazing answers that Brenda has just given us and just lifted the veil on, all these different aspects of contracts conveyancing in New South Wales is all about. But in the meantime, thank you for listening and until next time.