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It is very common for property buyers to obtain a Land Information Memorandum (LIM) prior to settlement. A LIM is a report compiled by the local government authority which includes information the council knows about the property.
This report is most useful in highlighting problems with the property that may not be obvious from a physical inspection. Standard Sale & Purchase Agreements include a clause making obtaining of and purchaser’s satisfaction of the LIM a condition of the purchase. Purchasers should understand that the LIM is not comprehensive and if the council does not know about an issue it will not be in the report.
The information the council must provide includes special features and physical characteristics of the land; stormwater drains; rates information; building consents; resource consents and code of compliance certificates; building certificates issued by a building certifier and whether the property is subject to a “leaky home” claim under the Weathertight Homes Resolution Services Act; what uses the land can be put to and conditions attached; any official classification pursuant to any statute (e.g. Historic Places Act or Reserves Act) and information notified by a utility operator such as a power or gas company.
However councils are not required to include the following in their LIMs :
1. Ongoing disputes between neighbours
2. Proposed neighbourhood developments are generally not included for adjacent properties.
3. Septic tanks on the property. These tanks are installed by private companies and are not part of the (Council’s) sewage system. Prospective buyers should ask the vendor about the tank(s) such as installation date, frequency of servicing and any problems.
4. Building Plans are often omitted from the LIM as they are too expensive and bulky. Many councils will provide entire property files on CD-ROM.
5. Exact Boundaries. Buyers should check survey pegs or ask their lawyer to obtain a copy of the certificate of title for you.
6. Easements are not covered by LIMs and buyers should ask their lawyer to check the certificate of title to ensure there is adequate access to and from the property.
7. Land covenants & Development Restrictions often fall outside what councils must include in LIMs.
8. Information on sites that are of special interest to Maori (waahi tapu).
LIMs therefore provide a generally sound source of information and prudent lawyers would recommend obtaining one each time a property is purchased.
For information or advice on any matter concerning property purchase please contact:
Franklin Law
Ph 09 237 0226
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