As we move closer to 100 per cent digital conveyancing in NSW on 1 July 2019, the Registrar General of NSW Jeremy Cox has some timely advice on procedures.
In 2016, the NSW Government announced the transition to electronic conveyancing with a timeline for change staged to allow participants to plan and prepare. The timeline began on 1 August 2017, with Authorised Deposit-Taking Institutions (ADIs) required to lodge their land transactions electronically. From 1 July 2018, the mandates were broadened to include standalone transfers and caveats and the take-up of electronic conveyancing accelerated (as at April 2019, 84 per cent of all eligible transactions were being lodged electronically). By 1 July 2019, all standard conveyancing transactions are to be lodged electronically.
1 July 2019
From 1 July 2019, the following dealings must be lodged electronically (if eligible to be lodged electronically) whether standalone, or in combination:
- Mortgages (including mortgages with justification where a name has changed)
- Discharges of mortgage
- Withdrawals of caveat
- Transmission applications.
This means that most typical conveyancing transactions, transfers, and discharge and mortgage documents must be lodged electronically through an Electronic Lodgment Network Operator, such as PEXA or Sympli when they begin operations later this year.
In addition, from 1 July, transactions involving simultaneous settlements will also need to be lodged electronically. Conveyancing transactions involving a simultaneous settlement that are close to/or cross over the 1 July transition date require extra consideration. It may well be that any delay in settlement means that you won’t be able to rely on the existing waiver (Waiver CR3/2018) and your transaction may be subject to a requisition from NSW Land Registry Services. The date of execution of the dealings will determine whether they are subject to the mandate or not.
In keeping with the Government’s commitment to move away from paper and towards digital, from 1 July 2020, all dealings that can be lodged electronically must be lodged electronically, whether standalone or in combination. NSW Land Registry Services (LRS) is widening the scope of eligible documents for electronic lodgement. You will find a schedule of dealings that can be/or are planned to be lodged electronically on the Office of the Registrar General’s website at https://www.registrargeneral.nsw.gov.au/eConveyancing/schedule-of-edealings.
Please read the Conveyancing Rules (Version 5) which come into effect on 1 July 2019 for more information on the requirements for electronic lodgement.
A rigorous compliance regime for subscribers is an integral part of eConveyancing. The regime is designed to improve the integrity and security of conveyancing in NSW, and involves LRS performing regular compliance audits on every eConveyancing subscriber in NSW.
As part of this audit process, you are required to provide documents and evidence that you complied with the NSW Participation Rules. My office’s role is to review LRS’s assessment of your compliance, ascertain whether further action is needed and advise you accordingly. To assist with this, ORG has created a checklist to help subscribers meet their obligations.
Here are some common errors we find in our subscriber compliance audits:
- Client Authorisation Form (CAF) not properly completed and signed
The common errors we find relating to a CAF is the authority type is either not selected, or incorrectly selected. It is important that the correct authority type in the ‘Transaction Details’ panel is selected. Failure to select the authority type results in a finding of non-compliance:
- Specific Authority – should be selected where the client authorises the subscriber to act on a specific transaction.
- Standing Authority – should be selected where the client authorises the subscriber to act for the period set out in the client authorisation, either until a specified date, or if no date is specified, until it is revoked by the client.
- Batch Authority – should be selected where the client authorises the subscriber to act in a batch of conveyancing transactions, such as in a strata development. Details of the transactions the batch authority is intended to cover should be attached.
- Verification of Identity
The common errors we find relating to verification of identity is the subscriber not providing sufficient evidence to support the steps taken to verify the identity of a person. If not relying on the Verification of Identity Standard, written evidence of the reasonable steps taken to verify the identity of a person must be prepared.
- Verification of Right to Deal
The common errors relating to verification of the right to deal are the same as verification of identity – that is, little or no supporting evidence of the steps taken by the subscriber to verify that the client has the right to deal with the subject property. We have noticed a few instances where the subscriber relied solely on the possession of a certificate of title as the right to deal.
Possession of a certificate of title on its own is generally not enough to tie the client on title to the property the subject of the transaction. Other right to deal documentation that may be required are:
- Local government rates notice
- Current utility bills for the property
- Current land tax assessment notice for the property.
- Contract of sale
The percentage of errors by category is shown below.
For more information, please contact the Office of the Registrar General at 1300 318 998 or [email protected].