Our current system on the face of it seems to work (but could it be made to work better). In some overseas jurisdictions registration occurs first then the funds are handed over. This makes sense. Purchasers once they and their FI has handed over clear funds, receive title and transfer and discharge of mortgage supposedly in registrable form. But the Purchaser is still at risk until registration ultimately occurs. Despite final searches, caveats by third parties can still be lodged. Fraud can defeat a Purchaser. Requisitions can be raised. Transfers are sometimes not lodged. Think Grove Conveyancing. There is still an element of uncertainty until registration is effected. And the practice of lodging caveats seems to have waned.
How could it be done better?
NECS. Could a two stage settlement be the preferred model? NECS is proposing a concurrent system of electronic registration of the ELF and simultaneous financial settlement. This in a way is emulating the current system but probably more certainty that registration occurs contemporaneously with transfer of funds. What about separating the registration and financial settlement?
(a) Electronic lodgment takes place 1 day or 2 days prior to financial settlement. Registration occurs “in escrow”. Like a decree nisi
(b) Upon notice of registration, you have financial settlement, either by EFT or bank cheques are handed over. Registration becomes complete. Decree absolute.
This 2 stage settlement process would perhaps allow more complex conveyancing transactions to take place and create a more flexible hybrid system to evolve.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment