Conveyancing Bill - Victoria

The Conveyancing Bill was introduced into Parliament this week (August 2006).

Under the Bill, conveyancers will be required to:

• have undertaken mandatory professional qualifications;
  
• have gained at least 12 months relevant practical work experience
  
• not be disqualified, such as having been an undischarged bankrupt or having been convicted of an offence involving dishonesty;
  
• have professional indemnity insurance;
  
• disclose to clients all costs and any commissions received;
  
• actively supervise their conveyancing business;
  
• have their trust accounts audited annually; and
  
• contribute to a Fidelity Fund to compensate consumers who lose money because of fraudulent conduct by conveyancers.
  

The Bill defines the work that licensed conveyancers may carry out, being “conveyancing work” which means legal work carried out in connection with any transaction that creates, varies, transfers, conveys or extinguishes a legal or equitable interest in any real or personal property, such as, for example, any of the following transactions:

• the sale of a freehold interest in land;
  
• the creation, sale or assignment of a leasehold interest in land;
  
• the grant of a mortgage or other charge.
  

The definition specifically excludes conveyancers from a range of legal work, such as commencing legal proceedings; applying for probate or letters of administration; establishing a corporation; creating a trust or will; giving investment or financial advice; the sale of a business; and advice in relation to obtaining consent to a development, an adverse possession application or other legal work as prescribed by regulation.


There also will be some transitory provisions and is not expected to come into effect until 1 July 2008

The Bill can be viewed at www.dms.dpc.vic.gov.au

Conveyancing Companies have been operating in a quasi-legal environment for the best part of 20 years. Conveyancing companies I have no doubt do legal work that should only be carried out by a qualified legal practitioner. Yet conveyancing companies have carried on without fear of prosecution for breaches of the Legal Practice Act.

The Law Institute of Victoria has done too little too late by prosecuting the business of conveyancer Lydia Maric. If there is a victory for legal practice it will be a hollow victory. Regulation of the conveyancing industry is now a foregone conclusion.

Reported by the Australian "Now that the Government has introduced legislation opening the market, the Law Institute should abandon its legal action and pay compensation," Ms Ludwell said. For almost a year, Ms Maric's business has been restricted by a Law Institute injunction that has required her to pay solicitors to complete forms that she considers part of her normal work. While the Supreme Court of Victoria has still not handed down its judgment on the Law Institute's test case, Ms Maric's legal bill from that court action is believed to be about $150,000.

For the consumer will the cost of conveyancing services come down as the government predicts? That's a moot point. I would have thought the compliance costs for conveyancing companies would increase. Theorectically there will be fewer back yard conveyancers as compliance costs make it harder for them to survive as a part time vocation.

I dont think it will be the regulation of conveyancing companies that will have the biggest effect on pricing of conveyancing services, it will be the advent and adoption of electronic & digital conveyancing that potentially will have the greatest effect on productivity and costs of providing conveyancing services.