New Residential Current Device (RCD) regulations benefits buyers!
Previously: If an owner of a residential premises effected a transfer without two RCD’s being installed, the owner committed an offence, and there was no provision for the new owner to recover the costs of installation of those RCD’s if the old owner failed to do so.
But Now: The new owners are obliged to install a residual currency device within two months of settlement date and have the right to recover the costs
from the previous owner. (Penalty for not installing the RCD’s could be up to $15,000.00 for individuals and in the case of a body corporate up to $100,000.00) And furthermore: If the new owner has given notice to the seller of intended demolition of the house – but has in fact not commenced demolition within six months of settlement date, then the new owner must ensure, before the end of the six month period, they have installed two RCD’s in the premises.
The new legislation came into effect on the 10th May, 2011. In essence, the buyer now has the benefit they can recover the cost of the installation of the RCD’s themselves if the seller had not arranged the installation prior to settlement.