It's common for a person looking to buy a property to enter
into an agreement as "Jane Smith or nominee." In fact,
nomination is so common, it is now an automatic part of standard
form sale and purchase agreements. The next step is for the buyer
to get a building report, and, if that gives the property the
all-clear, the buyer might form a trust or company to be the
ultimate purchaser of the property.
At that point, the buyer could lose all rights to claim against
the building inspector if the inspection is wrong, as was the case
in a recent High Court decision, Body Corporate 90315 v Redican
Allwood Ltd.
Jessica Patchett entered into a sale and purchase agreement for
an apartment in Wellington in the name "Jessica Patchett or
nominee." She engaged a building company to do an inspection,
and confirmed acceptance of the company's terms and conditions.
Ms Patchett then went unconditional on the purchase, formed a
company four weeks later, and the company settled the
