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CONVEYANCING TRANSFORMED | END TO END E-CONVEYANCING HAS ARRIVED
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Conveyancing Transformed
NSW Regional Roadshow David McDowell
Legal Officer eConveyancing, LPI
Priority Notices
Conveyancing Transformed- NSW Regional Roadshow
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Priority Notices
• Notification of intended registration of specified
dealing(s) with land
• Temporarily prevents registration of other
dealings (exceptions apply)
• Gives priority to the registration of specified
(unlodged) dealing(s)
• Automatically removed when ceases to have
effect or expired
Legislation
• The Real Property Amendment (Electronic
Conveyancing) Act 2015 introduced Part 7B
Real Property Act 1900
• Conveyancing Rules (Version 2, issued 28 October 2016)
– Rule 8.1- electronic lodgment only
• Available since 28 November 2016
Why lodge a Priority Notice?
• Effective risk mitigation tool for practitioners
– Black v Garnock [2007] HCA 31)
• Big head start in the “race to the Register”
• Protection in gaps between
– exchange and settlement
– settlement and lodgment (paper)
• Automatically removed when ceases to have
effect or expired
• Settlements where no CT
Priority Notices- the future without CTs
• New South Wales is moving to phase out paper
certificates of title, and a number of other states
have already done so.
• A Priority Notice will be very useful for parties in the
new world without paper certificates of title. After
lodging a Priority Notice an incoming party has the
assurance required to settle, knowing that that their
dealings are protected by the Priority Notice.
• In the current paper world parties get this assurance
from taking custody of the certificate of title at
settlement.
Priority Notices
• Priority Notice will operate for a specified period
– 60 days (with ability to extend once only for
30 days)
– during this period will prevent registration (but
not lodgment) of most other dealing(s)
• Recorded on the Register
Folio of the registerFIRST SCHEDULE
--------------
JOHN CITIZEN (T AY1234566 )
SECOND SCHEDULE (2 NOTIFICATIONS)
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1 RESERVATIONS AND CONDITIONS IN THE CROWN GRANT(S)
M 2 AY 1234567 MORTGAGE TO ABC BANKING CORPORATION
NOTATIONS
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PRIORITY NOTICES:
AZ1234567 EXPIRES 28/1/2017
DISCHARGE OF MORTGAGE AY1234567TRANSFER TO JANE MARY SMITH
UNREGISTERED DEALINGS: NIL
Priority Notices
• Expect majority to relate to settlement transactions -
transfers and mortgages
3 New Forms PEXA fee LPI fee
Priority NoticeWithdrawal of Priority NoticeExtension of Priority Notice
$8.80 $33.80 $8.80 $14.00$4.40 $14.00
All fees are inclusive of GST
Priority Notices• A Caveat noted on the Register will not prevent recording of a
Priority Notice.
• A Priority Notice noted on the Register will not preventrecording of a Caveat.
• A Priority Notice will prevent the recording of a Writ.
• A Priority Notice does not require a CoRD Holder Consent orthe Certificate of Title.
• Details in the Priority Notice cannot be altered. If theinformation relating to a transaction needs to be changedthen the Priority Notice must be withdrawn and a new PriorityNotice lodged.
Priority Notices
• Priority Notice can be lodged over part of a land
title for:
– one or more lots in an Auto -Consul
– a lot in an unregistered plan
– premises (for a lease)
Extension and Withdrawal of Priority
Notices
• The Subscriber who lodged the Priority Notice may
lodge an Extension or Withdrawal of Priority Notice.
• One only Extension for an additional 30 days giving
a total of 90 days from the date of its lodgement.
• The Priority Notice must be current at the time of
lodgment of Extension or Withdrawal.
• An Extension or Withdrawal must be over all titles
listed in the Priority Notice.
Dealings not prevented (s74W(2) RPA)
• a dealing in registrable form lodged before the Priority
Notice
• the dealing or dealings to which the Priority Notice relates
• a caveat or the withdrawal or lapsing of a caveat
• a vesting or dealing pursuant to an Order of Court or a
provision of a law of NSW or the Commonwealth
• a Transmission Application by Executors or Administrators
• an Application under s12 Trustee Act 1925
• a Notice of Death
Dealings not prevented (s74W(2) RPA)
• a dealing by a mortgagee or chargee (including power of
sale) where the mortgage or charge was registered or
lodged in registrable form before lodgement of the Priority
Notice e.g. Discharge of Mortgage, Transfer of Mortgage,
Transfer under Power of Sale etc.
• a dealing effected by the lessee pursuant to a right
conferred by the lease or by or under law where the lease
was recorded or lodged in registrable form before
lodgement of the Priority Notice, e.g. sub-lease, Transfer of
Lease, Mortgage of Lease etc.
Priority Notices- Consent
• The person who lodged the Priority Notice may
consent to the registration of a dealing or plan
which is prohibited by the Priority Notice.
• The consent must be in writing, signed dated
and addressed to Land Property Information,
NSW.
• The consent will be filmed with the affected
dealing or plan.
Priority Notices- scenarios
• If there are more dealings in the lodgment case
than in the Priority Notice
– eg, documents listed in the Priority Notice are
Discharge of Mortgage and Transfer
– dealings lodged are Discharge of Mortgage, Transfer
and Mortgage
– then LPI will register all dealings and remove Priority
Notice .
Priority Notices- scenarios
• If there are less dealings in the lodgment case
than in the Priority Notice
– dealings listed in the Priority Notice are Discharge of
Mortgage, Transfer and Mortgage
– dealings lodged are Discharge of Mortgage and
Transfer
– then LPI will send notice (and wait for lodgment of
Mortgage, consent, withdrawal of Priority Notice, or
expiry of Priority Notice).
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Priority Notices – Further Information
• Registrar General Directions
http://rgdirections.lpi.nsw.gov.au/e-dealings/priority_notice
• Priority Notice Circular
http://www.lpi.nsw.gov.au/__data/assets/pdf_file/0016/215431/2016-
14_Introduction_of_priority_notices.pdf
eCTs
Conveyancing Transformed- NSW Regional Roadshow
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What is an eCT?
• eCT is an electronic Certificate of Title
• Paper CT is not printed and issued for the
current edition of the folio
• Electronic record on the Folio of the Register
• The record indicates the party with control of the
right to deal
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Current eCT Eligibility
• Real Property Act amended late 2013
– Option to request eCT for restricted parties
– s33AA and 33AB
• Currently eCT is available:
– to APRA regulated financial institutions,
– who are subscribers to PEXA or represented by a
subscriber to PEXA, and
– who are the first registered mortgagee.
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eCTs
• Currently eCT is only available following registration
of new electronic mortgages (optional)
• Over 30,000 eCTs issued
• 1 March 2017- eCTs to issue to eligible mortgagees
from all eMortgages
• 1 August 2017- eCTs to issue to eligible mortgagees
from paper lodgements
• Major banks looking to bulk convert CTs
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Title Search – eCT (CoRD Record)
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Historical Search – eCT (CoRD Record)
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Impacts of eCT
• Impacts everyone in the property industry –
surveyors, solicitors, conveyancers, financial
institutions, lodging parties, etc - not just PEXA
users
• Changes how mortgagees provide consent for
all dealings and plans
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Impacts of eCT
• CT not handed over at paper (or electronic)
settlement
• CT not produced to LPI for subsequent
transactions
• CoRD Holder Consent lodged through PEXA in
lieu of CT
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CoRD Holder Consent
• Alternative safeguards required to prevent fraud
when a paper CT is not issued
• For eDealings - Consent is with the dealings
• For paper dealings - Consent is lodged
separately (standalone)
• Only require CoRD Holder Consent for dealings
that would normally require the CT
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CoRD Holder Consent
Different consent types depending on the
transaction:
1. Transacting Party Consent – used for settlement
transactions
2. Third Party Consent – used for subsequent
dealings and plans (similar to production)
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Transacting Party Consent
• CoRD holder is a party to the transaction
• CoRD is passed over at settlement
• Examples:
– Discharging mortgagee for a DTM
– Discharging mortgagee for a refinance
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Third Party Consent
• Similar to the concept of production
• CoRD holder is not a party to the transaction
• Provided to enable registration of a subsequent
transaction
• CoRD holder retains CoRD after registration
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eCT and paper settlements
Conveyancing Transformed- NSW Regional Roadshow
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eCT and paper settlements
• A paper CT is not required for settlement
purposes
• If eCT – discharging mortgagee lodges a CoRD
Holder Consent prior to settlement
• The consent type is Transacting Party Consent
• Consent must specify details of the incoming
transaction
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• Complete Request for Consent eForm with
transaction details
• Submit request form to initiate lodgment of a
CoRD Holder Consent
• Available on the Registrar General’s Directions
with instructions
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eCT and paper settlements
Request for Consent Process
5. Contact the CoRD holder if details are incorrect
4. Check the CoRD Holder Consent before settlement
3. Vendor’s representative submits eForm to the CoRD holder
2. Complete the Request for CoRD Holder Consent eForm
1. Confirm there is an eCT
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Request for Consent Process
1. Confirm there is an eCT
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Request for Consent Process
2. Complete the Request for CoRD Holder Consent eForm
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• Request for Transacting Party Consent
• Purchaser/representative may partially complete
and forward to vendor/representative:
– Clause 4.1 of Contract for Sale and Purchase of Land
(2014 Edition)
– Purchaser must provide details to the vendor of the
incoming parties at least 14 days before completion
– Failure to do so may lead to settlement delays
Request for Consent Process
3. Vendor’s representative submits eForm to the CoRD holder
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• Vendor or representative submits Request to
CoRD holder
• The Request should ideally be submitted with
the Discharge Authority
Incomplete and/or incorrect requests may lead
to processing and settlement delaysExample
Request for Consent Process
4. Check the CoRD Holder Consent before settlement
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Request for Consent Process
• Incorrect information in the request must be
amended
– E.g. incorrect dealing types or party names
• Contact the CoRD holder to arrange a
replacement Consent
5. Contact the CoRD holder if details are incorrect
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Request for Consent Process- Third
Party
4. heck the CoRD Holder Consent
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Practice issues
• Contract for Sale does not deal with pCT vs eCT
– At settlement, must give good title
• Acceptance of eConsent instead of pCT
• 33AB Real Property Act Alternative to production of a certificate of title– (1) A statutory requirement for the lodgment or production of a
certificate of title that is imposed in connection with the registration of a matter may, if the relevant folio notes that no certificate of title has been issued, be satisfied by the person recorded in the Register (under section 33AA) as the person having control of the right to deal in the land providing electronic consent to the registration of the matter.
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Additional Information
• LPI Fact Sheet - Attending a paper settlement when the
Certificate of Title (CT) is in electronic format
• LPI Circular - 'Optional no Certificate of Title': practice
changes for settlement and lodgment of dealings and plans
• LPI CoRD Video
• RG’s Directions – information about CoRD and CoRD Holder
Consent requirements
• Request for CoRD Holder Consent eForms
• Law Society Journal July 2015, pp 84-5
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Benefits of eConveyancing
Conveyancing Transformed- NSW Regional Roadshow
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• Less requisitions:
– Dealings are auto-populated with information fromthe Torrens Register
– Less data entry errors
– Dealings are verified before lodgment
• Title activity checks enables easy monitoring ofchanges to title e.g. caveats
• Dealings automatically unsigned if changes aremade or if fails lodgment verification
Benefits of electronic conveyancing
• Eliminates long interactions with banks to arrangesettlement
• Eliminates gap between settlement and lodgment
• Immediate confirmation of lodgment
• Earlier availability of cleared funds aftersettlement
• No need to physically lodge documents with LPI–particularly useful for caveats
• Easier access for rural and remote communities
• Can lodge Priority Notices
Benefits of electronic conveyancing
Conclusion
• www.lpi.nsw.gov.au/about_lpi/national_e-
conveyancing_nsw
• http://rgdirections.lpi.nsw.gov.au/e-dealings
• Sign up to newsletter, inquiries
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