Land Exchange - EC News

Stage 1 Electronic Conveyancing Pilot starts
Property transactions in Victoria entered a new era on 21 August 2006 when Stage 1 of the Electronic Conveyancing (EC) Pilot began with the first ever electronic lodgement of a discharge of mortgage. Westpac and ANZ were the first of the pilot group to lodge transactions online. Other financial institutions including the Bendigo, Commonwealth, Macquarie and National Australia banks, mecu Limited and Suncorp Metway will follow shortly. The pilot will enable the financial institutions to process mortgages and discharges of mortgage, removing the need for some paper documents to be lodged at Land Registry. Stage 1 of the pilot will continue in 2007 to enable a thorough analysis of the application and allow familiarisation with new processes. The Land Exchange Project Team would like to thank everyone who has been involved with the development of electronic conveyancing to date. We look forward to your continued support and to strengthening relationships with you as the system develops. When Stage 2 of the EC Pilot starts in 2007, the system will again break new ground by becoming the first e-conveyancing system in the world to include electronic financial settlement.

Impact of pilot on solicitors and conveyancers
Stage 1 of the EC Pilot is not expected to impact on the operations of solicitors or conveyancers. The only time solicitors or conveyancers will be affected is if they are involved in a dealing for a Volume/Folio where the paper Certificate of Title (pCT) has been converted to an electronic Certificate of Title (eCT) and left that way by one of the financial institutions participating in the pilot. When processing a transaction (discharge or mortgage) in Stage 1 of the pilot, the financial institution needs to convert the pCT to an eCT. However, the institutions are currently converting the eCTs back to paper after lodgement. In the unlikely event that a Certificate of Title is in electronic form when a solicitor or conveyancer starts a paper transaction, (possibly because a financial institution is in the process of dealing with it in EC), the folio search will clearly indicate that the title is electronic and give details of the financial institution controlling it. In these circumstances, when settlement arrangements are made, the financial institution controlling the title should be reminded to produce it in a paper format at the physical settlement

ANZ acknowledges benefit of EC system
The ANZ and Westpac banks are the first of the financial institutions to take part in Stage 1 of the Electronic Conveyancing (EC) Pilot. Head of ANZ's Mortgages Documentation and Settlements branch, Allen Gilgen, said staff involved in the pilot found the system intuitive and had experienced no operational issues. He said staff had also commented on the high standard of support provided by the Land Exchange Implementation Team. "The time savings associated with using an electronic system for all transactions could be substantial and will hopefully be realised once a greater volume of transactions is being put through the EC system," Mr Gilgen said. Allen said the benefits arising from the Victorian EC system would provide an opportunity to totally change the way financial institutions operated. He said streamlining the entire mortgage process could be achieved via EC and that the Victorian pilot was a good first step towards this. Commenting on the future for EC, Allen noted that the challenge for Stage 2 was to identify processes acceptable to a wide range of disparate stakeholders. He said the continuation of groups such as Financial Institutions Operations Group and the ongoing dedication of the EC Project Team would help achieve this goal.

EC Key dates

• 5 October 2006: legal framework consultation began.


• Late 2006: planning starts with solicitors and conveyancers for Stage 2 of EC.


• March 2007: legal framework consultation complete. Development of Financial Settlement Manager complete.


• Second half 2007: Stage 2 EC Pilot begins

Land Exchange News

Selling property has just got sexier

Punters are starting to get a dream run when hunting down property and doing their due diligence.

• google maps and


• 247legal

A great example is a property I found on realestate.com.au by viewing a postcode map for 3204 (Bentleigh) I clicked on a marker and up pops a brief description. At the same time I could view the 32 and legal documents for 1, 72 Brewer Road on 247legal.com.au

How much simpler can it get????

Do you own a unit or apartment? You're probably getting screwed

Apartment and unit owners would know all about body corporate management fees.

Virtually every apartment or unit complex has a body corporate which is responsible for common areas of the property (for example, lifts, swimming pools, driveways or gardens).

While owners will form the body corporate itself, management of the body corporate is almost always outsourced to a professional body corporate manager who handles administration, insurance, organise repairs and meetings.

The cost of body corporate management will vary wildly from $500 per apartment per year to more than $20,000 per apartment in luxury high-rise blocks.

Most (if not all) owners simply cough up the body corporate fees without questioning how they are spent. However, it is worth considering exactly what these fees go towards. ............

This Article was published by crikey.com.au - its worth reading the whole article

Subscribe to a free trial of crikey

Lawyers vs Conveyancers - the appeal

The LIV, of which I have been a paid up member since 1988 or thereabouts, is appealing their loss in the Supreme Court case of Maric.

Their loss is quite embarrassing for the legal industry, against what in effect was an action against the Conveyancing Institute and its members. Conveyancers effectively practically broke the Lawyers' monopoly on conveyancing a long time ago.

The LIV justification for appealing is to get a ruling on the definition of legal work.

For the life of me I fail to see what the LIV hope to achieve by obtaining a ruling on legal work when there is now a whole new Act with a different definition of legal work. It is such narrow thinking when on the other hand they talk up a national profession.

I was at the Southern Solicitors dinner when Tony Burke, who is a representative of the LIV, says its in the interests of the broader profession to obtain this ruling. I wonder if it is really and have they obtained the members view. I haven't been consulted.

I would be pleased to hear the official view from the President or the CEO of the LIV.

What outcome does the LIV expect from an appeal? The answer lies not in an appeal but effective lobbying to the Government to ensure conveyancers are restricted to conveyancing and in my view this should not include advice on mortgages, leases or sale of businesses.

As a suburban lawyer whose practice is mainly conveyancing I am looking to the future, not the past. The future of conveyancing will belong to those that excel at conveyancing based on service and price (and not necessarily the lowest price).

As this is a site dedicated to digital and electronic conveyancing the future moreover will belong to those that embrace change.

Fox fined $5,000 for Illegal Renovations

MULTIMILLIONAIRE trucking boss Lindsay Fox has avoided a conviction for illegal work during a $650,000 improvement to his daughter's Toorak house.

Mr Fox was fined $5000 — half the maximum penalty — and given two months to pay it and a costs order of $1935.

For the full story reported by The Age

As conveyancers we are always concerned, whether acting for vendors or purchasers about illegal structures. That is building works done without a building permit, no final inspection, warranty insurance, owner builder inspection reports.

Lindsay Fox plead guilty and has paid the fine. He wasn't ordered to demolish the illegal structures. If he was you would be sure we would not have seen an end to the litigation.

But for conveyancers all too often we see it as the wheels falling off the cart. If acting for a vendor we are cognisant of the vendor disclosure requirements and the possible consequences of non-disclosure and whether a contract is avoidable at any time up to settlement.

Acting for buyers there are the what ifs. What if there is an illegal structure? Sometimes we tell the client its better not opening a pandoras box by drawing the council's building section attention to what may be an illegal structure.

Yep. For conveyancers and clients, Illegal structures can be the classic Catch 22

PS. Agents acting for Vendors - This is a classic example of why you should use the Lawyer's Contract and not the REIV Contract Note. The Lawyer will usually include a Special Condition dealing with building matters thus any possible non-compliance with the Building Code shall not be grounds for rescinding the contract.

Feel free to post your experiences or dealings with illegal structures.

247Legal - The official industry launch

247Legal officially kicked off with a recent Industry Evening Launch. Since inception the online digital conveyancing system has successfully processed over 500 Victorian properties servicing vendor clients & estate agents, prospects & buyers, with clients & buyers from around the world. The past two years has seen the system tested, upgraded, constantly improved and automated.

The next phase for the company will focus on introducing legal firms and conveyancing companies to the benefits of online digital vendor disclosure without disrupting or replacement of their existing internal systems. The 247 system is designed to be an extension of desktop products such as LawPerfect which is popular amongst law firms and IceRidge which is used by the majority of conveyancing companies. The last point is very important as conveyancers and law clerks alike generally dislike wholesale change.

Attendees heard from Simon Libbis of NECS who spoke about the integral part companies like 247Legal will play in the "chain matrix" of electronic conveyancing and will be a driving catalyst for the early adoption of electronic settlements under the Victorian EC model and the National NECS model.

Michael Jellis of Hayton Kosky Lawyers gave a live demonstration of Adding a New Property. In less than 10 minutes, Michael had successfully completed a Section 32 and Contract for a Southbank apartment at 88 Southbank Boulevard. The result was a 62 page vendors statement ready to be approved online by the client in Hong Kong and to be downloaded and printed on demand by the estate agent with Melbourne Inner City Management. Michael admitted that he had done some prep work and had the Form 3, Lease and rate notices ready to be uploaded. Michael estimates that he has spent less than 30 minutes working on the file and the turnaround time from instructions was less than 7 days - without using the fax or the photocopier. Michael who is recently new to conveyancing thinks using 247 is a no brainer. Anyone who is interested can view the finished result.

UNIT 172, 88 SOUTHBANK BOULEVARD, SOUTHBANK

We had some excellent questions from Pauline Barrow and Jill Ludwell both from the Australian Institute of Conveyancing. Their initial concerns were 1) privacy and 2) can agents be trusted to print the 32? These concerns aside, and yes they were answered, Pauline and Jill certainly could see the merits of such a system in today's e-environment for their members.

It was however the unscripted testimonial from Craig Williamson of Buxtons Real Estate that carried the evening. Craig has been an early adopter and his support as a representative of the real estate industry carries a lot of weight. Craig made one observation which was. "12 months ago 1 in 10 buyers requested for the vendors statement to be emailed to them. That figure is now closer to 50% And the perennial problem we have is, it's frustrating waiting for 32s". With an extremely busy October, Craig would love to see all his vendors using accredited 247legal Lawyers or Conveyancers.

If any of us are to stay relevant, we must change to meet the needs of our clients, staff and the real estate industry in general.

The Most Bizarre Home in Sydney

It's a breathless climb from Whale Beach Road to Loggan Rock, built by the eccentric architect Alexander Stewart Jolly in 1929.

Fully Story SMH

EC (Victoria) is moving right along

EC is conducting a pilot with several financial institutions; drafting system rules; and has even produced a draft brochure giving an overview how things will work.

Have a squiz at their brochure

And if you are keen have a look at the System Rules on the Land Exchange website

It is interesting to see the first draft of the Representation Agreements that clients will need to sign with their Lawyer/Conveyancer/Subscriber as a prerequisite to enable the Lawyer to transact the Transfer on behalf of the client. There is also a "Remote Identification Certificate" for interstate and overseas clients.

Another interesting area is the security for the system for Users talks about "PKI Certificates must be stored on a hard token specifically designed to store digital certificates"

It sounds like the security for users will be a combination of a hardware device (token) and software security (User Name and Password) which I imagine will be pretty damn hard to hack.

1. PKI Certificates
2. Hardware or Security Tokens

As Wikipedia explains it is Two-factor authentication that requires two independent ways to establish identity and privileges. This contrasts with traditional password authentication, which requires only one factor (knowledge of a password) in order to gain access to a system.

Great Stuff

UK Home Information Packs - update

The trials which are beginning shortly will enable the reaction of both buyers and sellers to the packs to be tested on the ground in the run up to mandatory Energy Performance Certificates and Home Information Packs being introduced for all residential sales on 1 June 2007.
As part of the trials there will also be a range of incentives including a limited number of free packs; and packs available at a reduced cost for homeowners who want to try them out.
Housing Minister Yvette Cooper said: “We need to work together to tackle climate change. Twenty-seven per cent of carbon emissions come from our homes and it’s only right homeowners should have information on the energy efficiency of their houses. Residents who want to take part in the trials will be amongst the first to have these facts at their fingertips.
“Home Information Packs have the potential to speed up the home-buying and selling process by providing up-front information to potential buyers. It’s vital that we test them properly 'on the ground' so consumers get the best product possible.”

BACKGROUND NOTES ON HOME INFORMATION PACKS

1. Home Information Packs
   The Government is introducing Home Information Packs in England and Wales on 1June 2007 and anyone selling a property must provide potential buyers with a Pack. Every Pack will include an Energy Performance Certificate. The Packs will also include information such as searches and other legal documents. A Home Condition Report giving details on the condition of a property can also be included in the Packs on a voluntary basis.


2. Energy Performance Certificates
   An Energy Performance Certificate will provide buyers and sellers with A-G ratings on their homes, similar to fridge ratings, as well as a list of practical measures to cut their fuel bills and carbon emissions. By acting on the recommendations listed in the Energy Performance Certificate, the average homeowner is expected to save £300 a year on fuel bills and help to reduce the 27% of the UK’s carbon emissions currently generated by our homes.


3. Home Condition Reports
   The Home Condition Report contains information about the physical condition of the property on which sellers, buyers and lenders will be able to rely legally as an objective and authoritative report.
   Sellers who provide a Home Condition Report will have an early opportunity to carry out repair work on the property or obtain quotes prior to marketing. Potential buyers will be made aware of repairs that they might need to make and fund, or they will be reassured that the property is in good condition, in both cases before they decide to put in an offer. Lenders can also benefit by using the reports to inform their valuations, reducing the need to repeat a detailed on site inspection at the buyer’s expense.

The Government believes there will be significant benefits to home sellers from adding a Home Condition Report to their Packs, including greater certainty about sales being completed more quickly.

Trend in Qld to outsourcing conveyancing

As a result of a price war with fixed fee conveyancing services led by conveyancing companies, some Queensland legal firms have elected to simply outsource the conveyancing file to conveyancers. This is the gist of an article by Tim O'Dwyer a Queensland lawyer.

I personally can see the same thing happening in the Victorian market. The Victorian market will see further rationalisation with the passing of the Conveyancers Act and the advent of digital & electronic conveyancing. As far as the mega and mid-tier city law firms would be concerned, conveyancing would simply be an overhead. Where's the money in a $500 conveyancing file unless you are doing volume? Outsource it.

Article in Property Review by Tim O'Dwyer

Styling can add 5 to 10%

This month domain.com.au has some excellent real estate articles.

A professionally styled home will pull all the right emotional strings for buyers who fall in love with the lifestyle the home portrays.

For the full story by Jodie Thomson or download the PDF

we are moving

Love, laughter and lifestyle - or death, divorce and financial disaster. Knowing why people sell can be the key to striking a bargain.

Not a bad article from SMH Susan Wellings on the motivations for people selling and the impact this can have on price. Knowledge and information is power.

Link to SMH or download PDF

20 percent

An excellent article from the SMH on the rule of thumb to investing in property. Might sound a little conservative in this day of the 95% home loan.

SMH article by Nicole Pedersen-McKinnon or Download the PDF

BBC News reports on electronic conveyancing

House-buying 'to be made easier'

House-buying in the UK could become much easier through a new online conveyancing system being trialled by the Land Registry.

Buyers, sellers, estate agents and solicitors will be able to log on to the internet at any time, to see how far a potential sale has progressed.

A secure site displays details of any delays and their cause, as well as a notepad facility to leave messages.

It is to be run in Bristol with a view to a roll out across the country.

The Land Registry, a government agency, believes the initiative will improve the system considerably.

'Record results'

Ted Beardsall of the Land Registry, added: "Electronic conveyancing is a big programme which basically will replace the paper-based system of conveyancing with huge benefits."

Some 80 law firms in Bristol will take part in the conveyancing project, which will last for six months, before being assessed for a possible nationwide roll-out.

Solicitor David Brown said: "I think it will enable everyone to see what has been done.

"Every lawyer, solicitor, conveyancer down the chain will have to show exactly what they've done."

Charles Smailes, President of the National Association of Estate Agents, said: "Online conveyancing is an extremely important development for improving the buying and selling of residential property.

"Estate agents will be able to provide a more concise and effective service for their clients as they will have access to the most up to date information from their computer.

"The possibility of online completions and instant registration of title deeds is very exciting indeed as it will dramatically improve the length of time it takes to sell a home."

Story from BBC NEWS:

Lawyers vs Conveyancers - Round 1 victory to Conveyancers

On Tuesday, 3 October 2006 judgment was handed down in the Maric conveyancing case by his Honour Justice Osborn.

The Supreme Court judgment dismissed the Law Institute of Victoria's application (under the Legal Practice Act 1996) seeking an injunction to restrain the conveyancer from engaging in legal practice. The Court was dealing with a s32 statement which included clauses which are normally found in a contract of sale. The judgment dissolves the previously granted interlocutory injunction and now allows the defendant to continue to operate as a conveyancer, including the preparation of s32 statements. The LIV is reviewing the decision.

Given the Victorian State Government's review of conveyancing companies (and the result being the Conveyancers Bill) what was the Law Institute of Victoria thinking when it launched this action? And really wasn't it 20 years too late. Lawyers lost their conveyancing monopoly 20 years ago.


Supreme Court Victoria Summary of the Maric decision

LIV commenced this action in October 2005 - our inital report

The Paperless Office - Revisited

The Legal Office is often just a great big paper processing machine. It receives, files, retrieves, creates, file notes, collates, copies, distributes and archives paper - piles of it. Think Conveyancing, think Commercial Litigation.

Whilst the term the "Paperless Office" was coined in the 80s with the advent of the PC and the wordprocessor, these tools actually spurred an addiction to paper no different to the junkie's addiction to heroin.

But we now have the tools available to create "digital paper". PDF techonology is the new Digital Paper and it can be just as addictive as crack cocaine.

Here's one experts take on the Paperless Office.

Banks Offshore Back Office Jobs

Not pleasant news for those who are about to be made redundant. But banks are looking to offshoring jobs to lower their costs of back office operations including mortgage processing.

In my experience banks see mortgage processing and settlements as a necessary evil and devote the minimum amount of resources that they think they can get away with.

The solution is smart technology to do the drudge work. Banks have not made enough of web services in the mortgage processing and settlements. This is where the focus should be and deploy staff to handle the non-routine questions. It seems that there is a uniform misconception that NECS will provide all the answers. NECS will be part of the answer not the whole answer.

Outsourcing is the short term quick fix to lowering costs and boosting the bottom line.

See the full story from Australian IT