States debate the merits of new electronic conveyancing system

THE Victorian Government believes its new electronic conveyancing system could be a sound platform for the development of a national system.

Queensland's Department of Natural Resources and Water has already assessed the new system and, according to the Victorian Government, "found it could be adapted cost-effectively to meet that state's needs".

When the Victorian system goes live on November 16, it will enable electronic settlement for property sales and lodgment of land transfers as well as electronic payment of duty to the State Revenue Office.

It has been in development for five years and builds on the existing Victorian system of electronic lodgment and discharge of mortgages.

It will be the only system of its kind in Australia.

The Victorian Department of Sustainability and Environment, which is responsible for the new system, believes it has accelerated the development of electronic conveyancing around the nation.

But Victoria has only just made the software that underpins the new system available to all other states for assessment. For much of the development period, officials in NSW say they were unable to see the substance of what the Victorians were building.

That period of interstate suspicion appears to be ending. But it did little to foster the development of a national system. Each state has different methods of transferring and registering title to land.

Sources in NSW say there is no doubt that the Victorian system does not meet the needs of its northern neighbour.

Parts of it may be capable of being adapted, but NSW officials want a system that has been designed to meet the needs of their state.

So does this mean Australia is on the verge of a bout of parochialism of the type that left the nation with inconsistent rail gauges?

Responsibility for heading off that sort of calamity rests with an organisation known as the National Electronic Conveyancing System (NECS).

The steering committee for that organisation is chaired by Les Taylor, former general counsel of the Commonwealth Bank and one-time corporate lawyer of the year.

NECS brings together all the states as well as those organisations whose members are involved in conveyancing - including the Law Council, the Australian Bankers Association and the Australian Institute of Conveyancers. Despite the different requirements of the different states, all members of NECS are committed to overcoming the differences and establishing a truly national system.

The Law Council representative on that body is John Corcoran, a former president of the Law Institute of Victoria and an executive member of the Law Council.

"We want a seamless national system," he said.

"Everyone wants that. The question is: how do you deliver that?"

When the NECS steering committee met in Perth at the end of June, it made a decision that could provide a way forward.

"We decided that to the maximum extent possible, we want to use the Victorian system that has been developed.

"We want to adapt what the Victorians have done. So whether you are conveyancing a property at Toowoomba, Perth or anywhere, you just go online and do it through the national system," he said.

"You might need to change the system rules, or the way you identify someone who uses the system, but to the largest extent possible, the investment that has been made should be utilised. In my view there is no risk of a rail-gauge type problem."

One of the main reasons for this is that the key players - lawyers, bankers and conveyancers - are not prepared to tolerate interstate inconsistency.

"The lawyers and banks are key stakeholders. The banks were involved in developing the Victorian pilot but they are now stepping back and want to see it integrated into the national scheme," Mr Corcoran said.

"Right from the beginning, the Law Council has backed a truly national system."

The Australian Bankers Association acting chief executive Ian Gilbert said the banks had tested the Victorian system and found that it worked.

"But we want it to find its way through to a national system. The states need to get together.

"For our members, if it is going to be viable - given the investment involved - then the system needs to be national," Mr Gilbert said.

Chris Merritt | October 12, 2007
Australian Business