Sale and purchase agreement - Canterbury Earthquake Recovery ...

FURTHER TERMS OF AGREEMENT FOR SALE AND PURCHASE OF PROPERTY WITHINCANTERBURY RESIDENTIAL RED ZONE FOR UNINSURED IMPROVED PROPERTIESNB: This version is for use by: owners of residential properties who have never held insurance; owners of residential properties who held insurance at some time on or after 4September 2010 but who are not able to give the warranties required by the Crownunder the Insured Residential Property Owners Option 1A version; owners of non-residential properties who have never held insurance; and owners of non-residential properties who held insurance at some time on or after 4September 2010 but who are not able to give the warranties required by the Crownunder the Insured Not-for-Profit or Insured Commercial versions.18. DEFINITIONS18.1 In this Agreement, unless the context otherwise requires:"Benefits" means all of the rights and remedies of the Vendor in respect of:(a)the Claims including without limitation:(i)(ii)(iii)the right to pursue any Claim against EQC;the proceeds of any Claim;the power to give good discharge in respect of the Claim; and(b)the Other Claims."Claim" means the claims (if any) described in Schedule 5 (to the extent of the Vendor'sinterest in those claims), to the extent that such claims relate to damage and/or loss tothe Land in respect of any Event."EQC" means the Earthquake Commission continued under the EQC Act."EQC Act" means the Earthquake Commission Act 1993."EQC Cover" means the insurance of the Property (Land only) under section 19 of theEQC Act."Event" means any event causing damage and/or loss to the Property occurring on orfollowing 4 September 2010."Insurance Payments" means any payments (inclusive of GST) from EQC under theEQC Cover in respect of any Claim but excludes any such payments:(c)(d)(e)made to the Purchaser;made under the EQC Cover for repairs to the Land where the Vendor providesto the Purchaser evidence reasonably acceptable to the Purchaser that thevalue of such payments has been spent on repairs to the Land; ormade to a third party who has undertaken repairs or improvements to theProperty."Land" means land comprising the Property.2467861 v2 Version 1: 20 September 2012

"Other Claim" means any actual or potential claim in respect of loss or damage to theProperty (land or fixtures) arising from any Event which is not subject to a right ofsubrogation of the Private Insurer under a Policy or EQC under the EQC Cover andwhich is not a Claim."Policy" means any contract of insurance under which the Property was at any time onor following 4 September 2010 insured against natural disaster (including earthquake)damage, whether that contract includes other risks or not."Private Insurer" means the insurer that underwrites any Policy, including as named inSchedule 4."Rating Valuation" means the most recent capital value of the Property as at 4September 2010 as set by the relevant local authority in accordance with the RatingsValuation Act 1998.219. DEPOSIT19.1 Deposit amount: If "nil" is specified as the amount of the deposit on the first page ofthis Agreement, no deposit is payable. Otherwise, if the Settlement Date is:(a)(b)six weeks or less from the date of this Agreement, no deposit is payable; orotherwise more than six weeks from the date of this Agreement, the deposit isthe lesser of:(i)fifty percent (50%) of the sum of the Purchase price; and(ii) $50,000.00,and in each case the deposit is inclusive of GST (if any).19.2 Deposit payment date: The deposit shall be payable by the Purchaser to the Vendor'ssolicitor as soon as reasonably practicable after the date being the later of the date onwhich:(a)(b)the Purchaser is satisfied that it has received full and complete informationfrom the Vendor and EQC regarding any Insurance Payments and that thePurchaser has verified such information; andthe Purchaser receives certification from the Vendor's solicitor (in a formacceptable to the Purchaser) that:(i)any mortgagees in respect of the Property have consented on termsacceptable to the Purchaser to:(aa)(bb)the Vendor's entry into this Agreement; andpayment of the deposit in a manner proposed by theVendor's solicitor; and(ii)all chargeholders pursuant to a charging order or statutory landcharge, caveators, claimants under a notice of claim or persons withthe benefit of any other notice or instrument noted or registeredpursuant to legislation (in each case in respect of the Property) whichwould otherwise prevent settlement occurring (but excludingmortgagees) have each on terms acceptable to the Purchaser either:2467861 v2

3(aa)(bb)(cc)entered into a binding agreement whereby they have agreedto release the same on or before settlement.duly executed and delivered to the Vendor's solicitor alldocumentation and authorities required in order that theVendor's solicitor may release the same on their behalf on orbefore settlement; orthrough their solicitor provided an solicitor's undertaking tothe Vendor's solicitor that their solicitor will release the sameon or before settlement.20. VENDOR OBLIGATIONS AND CONSENT20.1 No claims for any Event: Clauses 20.6, 21.1, 22.2, 24 and 25 shall not apply if thereare no Claims in relation to the Land (whether because no Claims have been made orno building on the Property is a "residential building" as defined in the EQC Act).20.2 Purchaser rights to cancel or delay settlement: The Purchaser may, at its election,by notice in writing to the Vendor at any time prior to settlement, cancel this Agreementor delay the Settlement date if:(a)as at the Settlement date there is any unremedied breach by the Vendor of:(i)(ii)(iii)clause 21.2 (provision of information and access to Property); orclause 22.3 (Vendor assistance); orclause 22.4 (warranties as to validity of information).(b)(c)(d)(e)there is any failure by the Vendor's solicitor to provide such information andcertification as the Purchaser's solicitor may reasonably require to allowsettlement of this Agreement;the Purchaser considers that this Agreement confers benefits on the Vendor orcosts on the Purchaser which were unintended by the policy for the project ofwhich this Agreement is a part (as referred to in clause 27.1);the Government has directed in writing that circumstances have changedmaterially since 13 September 2012; orthe Purchaser has not received the certificate contemplated by clause 19.2(b).20.3 No prejudice to other rights: Expiry, termination, or cancellation of this Agreement(including by the Purchaser in accordance with clause 20.2):(a)(b)is without prejudice to any other right, power or remedy under this Agreement,at law, or otherwise, that the Purchaser has in respect of a default by theVendor; andshall not terminate clause 20.4, which shall remain in force notwithstandingsuch expiry, termination, or cancellation.20.4 Indemnity: The Vendor shall indemnify and keep indemnified the Purchaser from andagainst any loss, damage, or cost whatsoever arising directly or indirectly from anybreach of:2467861 v2

4(a)(b)(c)clause 21.1 or 21.2 (provision of information and access to Property);clause 22.3 (Vendor assistance); orclause 22.4 (warranties as to validity of information),whether before, on, or after the date of this Agreement.20.5 Privacy: The Vendor consents to the Purchaser collecting from EQC all details of theClaims made under the EQC Cover. The Purchaser may share the collectedinformation with its agents and advisers, EQC, the Private Insurer and any mortgagees.The collected information will be used by the Purchaser and those other bodies for thepurposes of completing the sale and purchase of the Property and the settlement of theClaims. Where the Purchaser holds personal information about the Vendor in such away that it can readily be retrieved, the Vendor has the right to obtain from thePurchaser confirmation of whether or not it holds such personal information, and toaccess and correct that information.20.6 Policy holder different from Vendor: If the Policy holder is not identical to the Vendor:(a)(b)the Vendor shall ensure that the Policy holder executes this Agreement;references in clauses 18.1 and 24.1 shall be read as references to the Policyholder and not the Vendor; and(c) references in clauses 20.4, 20.5, 21.1, 22.2, 22.3, 22.4, 23, 24.2, 26.1 and 27shall be read as references to the Policy holder in addition to the Vendor; and(d)references in clauses 20.2(a), 20.2(c) and the final reference to the Vendor inclause 22.1 shall be read as references to the Policy holder or the Vendor, asapplicable.For the avoidance of doubt, if any Vendor is also a Policy holder, execution of thisAgreement by that person shall be deemed to be execution in both those capacities.21. ACCESS TO INFORMATION AND PROPERTY21.1 Provision of information: The Vendor agrees to provide to the Purchaser as soon aspracticable following the date of this Agreement, copies of all information anddocuments relating to any Claim in the possession or under the control of the Vendor.21.2 Access to Property: Notwithstanding clause 3.2 of this Agreement, the Vendor agreesto at all reasonable times and upon receipt of reasonable written notice by thePurchaser allow the Purchaser, the Purchaser's agents, employees, valuers andengineers (together with necessary materials and equipment) , each at their own risk,reasonable access to, from and around the Property to permit or conduct anyinvestigations in connection with this Agreement.22. RISK AND INSURANCE22.1 Risk: The Property remains at the risk of the Vendor until the Settlement date, providedthat the Vendor shall have no liability to the Purchaser in the event of any damage to theProperty following the date of this Agreement, except to the extent that the Vendor is inbreach of any other obligation on it under this Agreement.2467861 v2

22.2 Assignment of Benefits: In consideration of the Purchaser entering into thisAgreement, the Vendor absolutely assigns to the Purchaser under section 50 of theProperty Law Act 2007 to the extent allowed by law:5(a)(b)with effect on the date of this Agreement, all of the Vendor's interest in theBenefits in respect of the Claims; andwith effect from Settlement, all of the Vendor's interest in the Benefits inrespect of Other Claims.and, for the avoidance of doubt, the Vendor shall have no further rights to, or interest in,the Benefits of Claims and Other Claims.22.3 Vendor assistance: The Vendor shall, within any reasonable timeframe required by thePurchaser, do all things reasonably requested by the Purchaser to allow the Purchaser(a)(b)to receive the full benefit of this Agreement; andto receive the full benefit and enjoyment of the Benefits, including by providingsuch further assignments of claims and/or the proceeds of claims as thePurchaser may reasonably require.22.4 Warranties as to validity of information: The Vendor warrants that all informationprovided by the Vendor to the Purchaser or any of its employees, agents orrepresentatives under this Agreement (including but not limited to information regardingInsurance Payments) is, to the best of the Vendor's knowledge, true and accurate in allrespects.23. FIXTURES AND CHATTELS23.1 The Vendor may remove chattels and any fixtures on the Property prior to settlement,subject to any obligation that the Vendor may have to a Private Insurer or EQC or anyother third party in respect of such chattels and fixtures.23.2 The Purchaser may, at its election, take without payment to the Vendor ownership ofany chattels and fixtures remaining on the Property on or following settlement.24. CONDUCT OF INSURANCE CLAIMS24.1 Excess: For the avoidance of doubt, the Vendor shall not be liable for any excesspayable under the EQC Cover.24.2 Conduct of claims: The Vendor shall:(a)(b)not do anything that may prejudice the Purchaser's ability to enjoy the Benefitof any Claim or Other Claim including receiving any proceeds of or settling aClaim or Other Claim;comply with all reasonable directions of the Purchaser in respect of the conductof all Claims and Other Claims.24.3 Deduction from Purchase price for Insurance Payments: If, at any time beforeSettlement, any Insurance Payment is made that is not already included in Schedule 3,the amount of such Insurance Payment shall be shown in the Settlement statement as afurther deduction to the Purchase price.2467861 v2

625. EQC PURCHASE PRICE TOP-UP25.1 Top up: If, following the Settlement date, EQC pays to the Purchaser an amount insettlement of the Claims that is greater than the Purchase price, the Purchaser shall,within a reasonable period following EQC's payment of that amount, pay to the Vendoras an additional purchase price, the difference between the Purchase price and thatamount. All amounts referred to in this clause 25.1 are inclusive of GST.25.2 No duty imposed: Nothing in clause 25.1 shall have the effect of imposing on thePurchaser any duty whatsoever to seek, or an expectation that the Purchaser will seek,to recover any particular amount from the EQC and, for the avoidance of doubt, theparties acknowledge that the Purchaser has an unfettered discretion as to how it willpursue the Claims and may settle Claims with EQC at its sole and unfettered discretion.26. DANGEROUS OR UNINHABITABLE BUILDINGS26.1 Dangerous buildings: Nothing in this Agreement prevents the Purchaser or any otherarm of the Crown exercising any statutory rights or duties, including to require theVendor to cease living in or occupying the Property because the Property is adangerous building (as defined in the Canterbury Earthquake Recovery Act 2011) or isuninhabitable, earthquake prone or unsanitary.26.2 Purchase not as dwellinghouse: The Purchaser acknowledges that, for the purposesof section 39 of the Health Act 1956, the Property (including any houses or fixtures onthe Property) is not being sold pursuant to this Agreement as a dwellinghouse.27. SETTLEMENT DATE27.1 Changes to Settlement date: The Vendor acknowledges that the entry by thePurchaser into this Agreement is part of a large-scale project by the Purchaser toacquire properties in areas of Canterbury that were worst affected by earthquake Eventsin that area (in particular, those Events on 4 September 2010, 22 February 2011 and 13June 2011). For that reason, the Vendor acknowledges that the Purchaser requiresinformation from the Private Insurer, EQC and the Vendor in order to completesettlement. The parties therefore agree (without derogating from the Purchaser's rightsunder clause 20.2) that if, at any time on or prior to 5 working days prior to settlement,the Purchaser is not reasonably satisfied that it has received full and completeinformation from the Vendor, the Private Insurer and EQC regarding the Claims and anyInsurance Payments, the Purchaser may defer the Settlement date.27.2 Notice of change to Settlement date: The Purchaser undertakes to give to the Vendoras much advance notice as is reasonably practicable in the circumstances of anychange to the Settlement date made in accordance with clause 27.1.27.3 Deemed new Settlement date: The new Settlement date shall be 5 working days fromthe date on which the Purchaser gives to the Vendor written notice that it is reasonablysatisfied that it has received full and complete information from the Vendor, the PrivateInsurer and EQC regarding the Claims and any Insurance Payments. Any newsettlement date notified to the Vendor by the Purchaser in accordance with this clause27.3 shall be deemed to be the Settlement date for the purposes of this Agreement.28. GENERAL28.1 Lowest price: For the purposes of the financial arrangements rules in the Income TaxAct 2007, the Purchase price for the Property is the lowest price the parties would have2467861 v2

28.2 Costs:agreed upon for the Property, on the date this Agreement was entered into, if paymentwould have been required in full at the time the first right in the Property was transferred,and on that basis no income or expenditure arises in respect of the sale and purchase ofthe Property under those rules.7(a)(b)Subject to clause 28.2(b), each party will meet its own costs relating to theconsideration, entry into and implementation of this Agreement.On the Settlement date, the Purchaser will pay to the Vendor, in addition to thePurchase price, 50% of the Vendor's actual legal costs (including, withoutlimitation, disbursements) incurred in relation to the consideration, entry intoand implementation of this Agreement up to a maximum Purchaser contributionof $500 (exclusive of GST, if any), provided that such amount has been shownin the Settlement statement and the Vendor's solicitor has also given to thePurchaser's solicitor a tax invoice addressed to the Purchaser for suchcontribution.28.3 Further assurance: Each party shall make all applications, execute all documents anddo or procure all other acts and things reasonably required to implement and to carry outits obligations under, and the intention of, this Agreement.2467861 v2

SCHEDULE 3PURCHASE PRICERating ValuationLand value (as shown inValuation)Rating$Less 50% of that Land value $Less cash received from EQC (ifany)Plus cash received EQC spent onrepairs for which evidence can beprovided (if any)$$TOTAL PURCHASE PRICE** Total Purchase price remains subject to further adjustment pursuant to further term of sale 24.3.2467861 v2

9SCHEDULE 4DETAILS OF POLICYInsurer2467861 v2

10SCHEDULE 5DETAILS OF CLAIMSClaims to be assigned - EQC Cover2467861 v2