Property sales and settlements guidance for lawyers during COVID-19

Guidance for lawyers in an Alert Level 4 area

For guidance for non-lawyers dealing with property sales and settlements, see:

Guidance for property sales and settlements during COVID-19

The COVID-19 Alert Level System is in place to manage and minimise the risk of COVID-19 in Aotearoa New Zealand. The system helps people understand the current level of risk and the restrictions that legally must be followed. Alert Levels may be applied at a town, city, territorial local authority, regional or national level.

For up to date key information about COVID-19 Alert Levels and moving, selling or buying a property, see the Unite Against COVID-19 website:

Moving, buying and selling your home(external link)

You should be aware that the COVID-19 Alert Level could be increased at any time and new restrictions would apply. You should take this into account when advising your clients.

How are property sales and settlements affected in an Alert Level 4 area?

At COVID-19 Alert Level 4, any activity relating to property sales must only be done remotely and moving house is not allowed except in extreme circumstances.

If a property settlement is due to occur during Alert Level 4, we recommend that parties agree to delay settlement if possible. Some agreements may have a clause allowing settlement to be delayed.

New sale and purchase agreements should include a clause in the agreement to delay settlement until an Alert Level is in place which allows settlements to occur. They should also contain a clause allowing for the ability to defer the confirmation dates of further terms where it is not possible to complete due diligence investigations due to an Alert Level restriction.

It may still be possible to complete a sale during Alert Level 4 where there is no movement of people, for example a rental property with tenants staying.

At COVID-19 Alert Level 4:

  • people can only move house under extreme circumstances, for example for care while sick or to seek refuge in a women’s refuge accommodation
  • moving companies cannot operate
  • real estate agency work can only be conducted by phone, video or email
  • open homes and auctions cannot take place in person, but can happen virtually (for an open home, the person living in the home must show it, the real estate agent cannot go in).

For further information, please visit:

Moving, buying and selling your home(external link)

Detailed information about property sales and settlements, and the conditions that must be complied with during Alert Level 4 is also available at:

REA information on conducting real estate business during Covid-19 Alert Level 4 (external link)

Can lawyers meet with clients or execute documents in person in an Alert Level 4 area?

No, at Alert Level 4, lawyers will be unable to provide legal advice to clients in person. All documents should be executed or witnessed remotely in an Alert Level 4 area in order to continue limiting close physical contact.

A temporary change has been made to the Oaths and Declarations Act 1957 to enable oaths, declarations and affirmations to be completed remotely. More information about this change can be found at:

Information for people needing to complete oaths, affirmations or declarations during COVID-19

Land Information New Zealand (LINZ) has provided guidance regarding signing documents remotely and the modifications to deal with COVID-19 restrictions:

LINZ interim guidance on verification of identity and electronic signatures(external link) 

In light of COVID-19, a temporary change has been made to the Protection of Personal and Property Rights Act 1988 to enable the witnessing and executing of an enduring power of attorney to occur remotely. More information about this change can be found at:

Signing and witnessing EPAs during COVID-19 

The New Zealand Law Society has published COVID-19 information:

NZLS COVID-19 Information(external link)

Guidance for lawyers in an Alert Level 3 area

For guidance for non-lawyers dealing with property sales and settlements, see:

Guidance for property sales and settlements during COVID-19

How are property sales and settlements affected in an Alert Level 3 area?

At COVID-19 Alert Level 3, it is possible to complete some property sales and settlements, and move house, as long as certain conditions are complied with. At Alert Level 3, there is an expectation that all activity relating to property sales and settlements is carried out remotely wherever possible.

Given the restrictions that moving companies may face at Alert Level 3, if possible, settlement should be delayed until Alert Level 2. Given Alert Levels can fluctuate, all new sale and purchase agreements should include a clause to delay settlement until an Alert Level is in place which allows settlements to occur. They should also contain a clause allowing for the ability to defer the confirmation dates of further terms where it is not possible to complete due diligence investigations due to an Alert Level restriction.

At COVID-19 Alert Level 3:

  • people can move house, including between regions with different Alert Levels. They will need to carry documents showing they are moving house to explain their travel (for example, the sale and purchase agreement).
  • moving companies can operate, but would need an exemption from MBIE to travel in or out of an Alert Level 3 area
  • real estate agency work is permitted, subject to specific requirements
  • private viewings of properties are possible in limited situations and under certain conditions
  • pre-settlement inspections can take place under certain conditions
  • property professionals (such as builders or engineers) can conduct inspections on the property if the inspection is a condition of the sale and purchase agreement or if the property is to be sold at auction.

For further information, please visit:

Moving, buying and selling your home(external link)

Detailed information about property sales and settlements, and the conditions that must be complied with during Alert Level 3 is also available at:

REA information on conducting real estate business during Covid-19 Alert Level 3(external link)

Can lawyers meet with clients or execute documents in person in an Alert Level 3 area?

At Alert Level 3, lawyers will be unable to provide legal advice to clients in person in their work premises. All documents should be executed or witnessed remotely during Alert Level 3. These restrictions seek to limit close physical contact at Alert Level 3.

The Law Society has developed guidance for lawyers on witnessing and signing legal documentation during Alert Level 3. This guidance is available at:

In-person witnessing/signature of documents by lawyers at Alert Level 3(external link)

Guidance for lawyers in an Alert Level 2 area

How are property sales and settlements affected during Alert Level 2?

At COVID-19 Alert Level 2, it is possible to conduct and complete property sales and settlements in person as long as the necessary public health and physical distancing requirements are complied with.

At COVID-19 Alert Level 2:

  • people can move house, including between regions with different alert levels (anyone moving from an Alert Level 2 to an Alert Level 4 region must carry documents to show they are moving house)
  • people can meet with their lawyer or agent in person
  • open homes can take place, as long as certain conditions are met, including contact tracing, limits on gathering numbers and maintaining the necessary physical distancing requirements at all times
  • property professionals and tradespeople may visit the property to complete due diligence or complete work to meet the conditions of sale. Anyone visiting a property needs to follow physical distancing guidelines. People should not visit a property where someone is unwell or self-isolating
  • auctions can take place under certain conditions, including contact tracing, gathering number limits and physical distancing.

The Law Society recommends that lawyers be given the opportunity to review contracts before they are signed.

For further information please visit:

Moving, buying and selling your home(external link)

Detailed information about property sales and settlements, and the conditions that must be complied with during Alert Level 2 is also available at:

REA information on conducting real estate business during Covid-19 Alert Level 2(external link) 

What requirements do lawyers need to adhere to when meeting with clients or executing documents in person during COVID-19 Alert Level 2?

At Alert Level 2, lawyers will be able to meet with clients and execute documents in person, as long as all public health and physical distancing requirements are met. When meeting clients in person, you should maintain a 2-metre physical distance at all times and adhere to all public health advice, including disinfecting frequently touched surfaces and objects. 

At Alert Level 2, documents can still be executed remotely if this is the lawyer or client’s preference. Land Information New Zealand has issued interim guidance on the requirements for remote verification of identity and the use of electronic signatures during this time:

LINZ interim guidance on verification of identity and electronic signatures(external link) 

What happens if a party to a sale and purchase agreement cannot settle because of the response to COVID-19?

The sale and purchase agreement sets out what happens if one party is not able to settle. The agreement may allow one party to cancel the agreement and / or seek compensation if the other party can’t complete the sale.

Many agreements now have a clause that allows settlement to be delayed until after the Alert Level is reduced to an Alert Level which allows settlements to occur.

If the agreement does not contain this clause, the legal position is less clear. It is best to talk with your client about options. The ideal solution is to negotiate and reach an agreement with the other party.

Are all settlements automatically deferred as a result of the measures being taken against COVID-19?

No. There is no automatic deferral at any Alert Level. Some contracts may include a clause deferring settlement at certain Alert Levels or where both parties are unable to settle. This could be the case where there are technology issues with the settlement.

Every situation is different. In most cases, both parties will want to find a way for the sale to proceed. Finding a mutually acceptable agreement is the best approach to avoid legal disputes and court proceedings which can be time consuming, stressful and expensive.

Can parties cancel their contract because of the measures being taken against COVID-19?

There is no general right to cancel a contract because of the measures being taken against COVID-19. Cancellation rights primarily depend on the individual agreements. In some cases, the sale can go ahead during COVID-19 Alert Levels 3 and 4 without significant problems. Some contracts may have clauses allowing settlement to be delayed at certain Alert Levels.

Under section 36 of the Contract and Commercial Law Act 2017, a party may have the right to cancel a contract if the other party repudiates (makes it clear that they will not comply with) the contract. A party could also cancel a contract if the requirements of the common law doctrine of ‘frustration’ are met. However, it is not clear that those requirements are met only because of the response to COVID-19. Additionally, most contracts have specific requirements that need to be met before cancellation can occur.

A party repudiating or cancelling a contract without a proper basis may face significant legal consequences, such as liability for damages for breach of contract.

You are best placed to provide guidance on what may happen if the parties are not able to agree on a way forward. For example, options that may suit your client’s specific circumstances and interests could include:

  • deferring settlement to a different time
  • a price adjustment
  • lowering the interest rate for late settlement
  • the buyer renting the property back to the seller after settlement.

Every situation is different. You are best placed to provide advice on the range of options available for your clients and to try and reach an agreement with the other party.

Can property sales still be registered?

In all cases, it will be possible to transfer ownership electronically if there are no other problems that prevent the sale going ahead. Many lawyers and conveyancers may be working from home but will be available for their clients and have the necessary technology.

Land Information New Zealand’s (LINZ) electronic land register Landonline is still operating, enabling the registration by lawyers of relevant documents such as transfers or mortgages. Documents that are sent to LINZ by post or courier are still being accepted but processing times may be longer, as some LINZ staff are working remotely.

LINZ has updated its website bringing together a range of information about its services during the current Covid-19 Alert Level restrictions:

COVID-19: Information about LINZ services(external link)

LINZ has issued interim guidance on the requirements for remote verification of identity and the use of electronic signatures during this time:

LINZ interim guidance on verification of identity and electronic signatures(external link)

Lawyers and conveyancers can still access Landonline remotely. Those lawyers and conveyancers wanting to restore their digital certificate to their work device should follow these steps:

LINZ Transferring your digital certificate(external link)

More information about LINZ services can be found at:

COVID-19: Information about LINZ services(external link)

Can a buyer cancel their contract because their financial situation has changed due to COVID-19?

A buyer cannot generally cancel their contract because of their financial position unless the contract is conditional upon finance. You should encourage your clients to discuss any financial issues with you and their bank. Even if there is no relevant clause, the other party could be open to hearing about your client’s particular situation and be willing to come to a mutually acceptable agreement given the unprecedented circumstances.

What can I do if my client or the other party refuses to discuss new arrangements for settlement?

Most people are reaching agreements that take into account these extraordinary circumstances and lawyers have had a crucial role in this. Lawyers should make sure their client is aware of the position the other person is in. For example, if your client is the seller, have they thought about whether they will be in a position to hand over keys, or whether the purchaser will be able to carry out the pre-settlement inspection? Have they investigated whether they could get a repayment holiday in respect of their mortgage payments?

Lawyers can provide their best advice and support to their clients but cannot prevent people from insisting on strictly enforcing their contractual rights. Where this happens, and no agreement can be reached, this could lead to court proceedings, which can be costly, unpredictable, and in current circumstances have the potential to be significantly delayed. Lawyers are encouraged to make sure their clients are aware of the risks if the parties can’t agree.

Can I charge my client for extra work?

You should be upfront with your client if extra work you need to do as a result of the response to COVID-19 will result in additional costs. You have a duty to charge a fee that is fair and reasonable and to let your client know how and when they will be billed.

Read more on the Law Society’s website(external link)

Where can I get more information?

You may wish to refer to the Law Society website for COVID-19 information and related guidance for law practitioners:

Law Society COVID-19 information(external link)

The Real Estate Authority (REA) has published some guidance for sellers and buyers and prospective sellers and buyers: 

REA guidance for homebuyers and sellers(external link)

For information about the Government’s COVID-19 response and the Alert Levels visit:

Unite Against COVID-19(external link)

Government agencies with relevant responsibilities are:

  • Ministry of Justice – property and contract law: Ministry of Justice website(external link)
  • Land Information New Zealand (LINZ) – LINZ manages land transfer registration processes and makes land information available to the public. LINZ website(external link) LINZ’s contact centre is operating: 0800 665 463 (New Zealand), +64 7 974 5595 (international callers), email: customersupport@linz.govt.nz
  • Department of Internal Affairs (DIA) - DIA is responsible for requirements of due diligence under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT). DIA website(external link)

COVID-19 response level measures apply to all of us

The purpose of the response to COVID-19 is to save lives. We all need to stick to the rules of physical distancing and only move around for the specific purposes allowed under the current Alert Level.

Across the world, millions of transactions are affected in one way or other by COVID-19. Please continue to be kind, cooperate and try to find a good way forward which works for both parties considering these unprecedented circumstances.

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