Properties sold at auction in Melbourne may not go to the winning bidder after a real estate agent on Saturday sold a Burwood East home for more money after the hammer fell.
The auction exposed a legal grey area, sparked outrage among the crowd - and drew the promise of a probe by the Real Estate Institute of Victoria.
Hao Chen thought he had bought the home at 10 Aruma Court (pictured) after the auctioneer brought down his hammer and declared the property sold. But moments later - in front of a large and dismayed crowd - the auctioneer's boss allowed a late bid of $1000 more.
"(The auctioneer's) hand hit the piece of paper, the property was sold," said Martin Bona, a local resident at the auction.
Waverley City First National auctioneer David Makris said he had closed the auction before accepting the new bid at the behest of his boss, First National managing director Thomas Som.
Buyer's advocate Chris Koren, of Morrell & Koren, said the practice, while rare, undermined the integrity of the auction process.
"For want of a little bit more money, this will cause a lot of criticism in the industry and about the industry," Mr Koren said.
A distressed Mr Chen told The Sunday Age he had been treated unfairly.
"They told us because contract had not yet been signed the vendor would sell to whoever would give them the highest (amount). I wouldn't negotiate. It's not a money issue, this is bullshit," Mr Chen said. The property eventually sold for $3000 above Mr Chen's bid.
Robert Larocca, a spokesman for the Real Estate Institute of Victoria, said convention holds that a property is sold at the fall of the hammer, although legally the sale only occurs with the signing of a contract.
"It's a bit of a grey area," Mr Larocca said. "The (State Government) is currently reviewing auction law with a view to changing the law so a legal contract comes at the fall of the hammer."
Mr Som said that while the outcome was regrettable, the agency was obliged to look after the best interests of its client.
"We're not happy with the way it happened, we were not looking for this to happen," he said. "But again we are working to get the best price for our vendor."
Mr Chen said he intended to lodge a complaint with the REIV. Mr Larocca said the institute would be happy to investigate after a formal complaint was lodged.
When is it sold?
Consumer Affairs Victoria says that when the auctioneer has reached what seems the final bid, he or she will announce, "Going once, twice, three times . . . SOLD!"
"There are no further offers accepted after this point," it says, but there is no legally binding contract until the buyer and seller have signed the contract of sale
Author: Chris Vedelago
Date: November 21, 2007
The Age Domain
Responses of outrage and incredulation to the story
1. Consumers' wrath
I was incensed to read about the real estate company that auctioned a Burwood East house twice and in the process denied Mr Chen securing the property with his winning bid.
If I was in Mr Chen's shoes I would attend all future auctions of that scurrilous company, outbid the field and, as the crowd dispersed, simple back out of the deal.
"I've changed my mind - taa all the same" should suffice. Let them feel the wrath of the consumer.
David Hodgson, Sunbury
2. Put First National Last
What disgusting behaviour on the part of First National. It is a sad state when we need to rely on laws for people to behave with decency and act in good faith.
When we attend an auction, we all know the rules and the expectations of everyone else there. "Going once, going twice, sold" .... congratulations to the buyer and seller, the end. To accept a higher bid afterwards, even if the law permits it, is plainly cheating.
I would encourage all fair-minded people to boycott First National.
Sean Fremder, Caulfield
Letters to The Age
15 Dec 07 - REIV news
REIV: "I am pleased to inform you that the Minister for Consumer Affairs has formally advised the Institute that the government will amend the Sale of Land Regulations 2005 to prohibit late bids at public auctions. This follows sustained lobbying by the REIV on this issue. The prohibition will apply to all auctions, not just residential.
The Regulations will be amended early in the new year. It is anticipated the amendments will prohibit late bids both on sales and pass-ins and provide a substantial penalty for auctioneers who fail to comply.
The impending change clearly indicates the government and regulators consider the taking of late bids is completely unacceptable behaviour."
Sunday, November 25, 2007
Friday, November 23, 2007
Electric Shock
VICTORIANS who buy and sell property have no reason to celebrate last Friday's launch of the state's electronic conveyancing system. Its biggest impact has been an increase in the cost of paper-based conveyancing. And because the banks are not using the new system, most property transactions are still paper-based.
The Law Institute has complained about the price rise and so have the Master Builders. But the Government persists with portraying its new system as some sort of step forward.
The Government has not even been able to persuade the LIV to recommend that its members use the new system.
The problem keeping most solicitors out of the system is the belief that it might expose them to a degree of risk that is not present with paper-based transactions. Doubts have emerged about who would be liable if, for some reason, an electronic conveyancing transaction were affected by fraud.
And that is where Ellie Comerford might have a solution. Comerford runs a company called First Title that insures title to land. Up to a point, she agrees with the LIV. She says there is a risk of fraud in electronic conveyancing but she argues that the risk is no greater than the risk that already exists with paper-based transactions.
To prove her point, she says First Title has sold 200,000 land title insurance policies and has paid out on several claims.
In order to address the LIV's concerns, she says a neat solution would be to simply insure each transaction under the new electronic system.
But let's not get ahead of ourselves. Even if all Victoria's solicitors sign up with the new electronic system, it is going nowhere without the banks.
Chris Merritt | November 23, 2007 | The Australian
The Law Institute has complained about the price rise and so have the Master Builders. But the Government persists with portraying its new system as some sort of step forward.
The Government has not even been able to persuade the LIV to recommend that its members use the new system.
The problem keeping most solicitors out of the system is the belief that it might expose them to a degree of risk that is not present with paper-based transactions. Doubts have emerged about who would be liable if, for some reason, an electronic conveyancing transaction were affected by fraud.
And that is where Ellie Comerford might have a solution. Comerford runs a company called First Title that insures title to land. Up to a point, she agrees with the LIV. She says there is a risk of fraud in electronic conveyancing but she argues that the risk is no greater than the risk that already exists with paper-based transactions.
To prove her point, she says First Title has sold 200,000 land title insurance policies and has paid out on several claims.
In order to address the LIV's concerns, she says a neat solution would be to simply insure each transaction under the new electronic system.
But let's not get ahead of ourselves. Even if all Victoria's solicitors sign up with the new electronic system, it is going nowhere without the banks.
Chris Merritt | November 23, 2007 | The Australian
Full roll-out of HIPs announced
The UK Government today announced the roll-out of Home Information Packs (HIPs) to all properties marketed for sale in England and Wales from 14 December 2007, whatever their size.
Communities and Local Government issued a press release and Ministerial Statement on the full roll-out of HIPs and supporting activity to ensure continued smooth implementation
GREEN RATINGS TO BENEFIT ALL HOME BUYERS
First time homebuyers will see their upfront costs drop and all home buyers will, for the first time, receive A-G green ratings for their properties which will help cut fuel bills and carbon emissions, with the roll out of Home Information Packs (HIPs) and Energy Performance Certificates (EPCs) announced today.
Buyers whose homes score poor energy ratings of F or G (currently around one-fifth of all homes) will receive an offer of a discount or free help with energy efficiency measures from the Green Homes Service which will be established, helping to save hundreds of pounds off fuel bills, as announced by the Prime Minister this week.
Sixty per cent of the market is already covered by HIPs. The Government has announced the rollout of HIPs and EPCs to the rest of the market from December 14 this year, as the criteria set out for roll out on 11 June have now been met.
House hunters will get detailed information about the energy efficiency of their home with a green rating of A-G, similar to consumer friendly fridge ratings, in an EPC.
The final stage of the roll out follows careful analysis of how HIPs and EPCs have been working in order to maintain their smooth introduction into the housing market.
The extension of HIPs to all properties will particularly benefit first time buyers through a reduction in their upfront costs by not having to pay for a pack, helping them in getting a foot on the housing ladder.
The packs are already beginning to bring benefits to consumers with average property search costs starting to fall with the new competition from HIPs – 85 local authorities have already reduced their charges by £30 on average.
Housing Minister Yvette Cooper said:
“HIPs and EPCs are already helping consumers to save hundreds of pounds off their fuel bills and are cutting search costs too. All home buyers will be able to benefit from energy efficiency advice, with those receiving low green ratings of ‘F’ and ‘G’ especially targeted for support and grants to make improvements to cut their costs and carbon emissions.”
Early monitoring of the scheme shows the roll out has gone smoothly.
* HIPs are taking on average 7 to 10 days to prepare
* The majority of property, and drainage and water searches, are being delivered promptly within 5 days
* EPCs are being prepared on average within 2 to 4 days
* The average cost of a pack is £300 to £350 – costs which apart from the new information included in the EPC are already part of the home buying and selling process.
The Government has also today published an independent report by Europe Economics on the impact of HIPs on the market. Their report finds no evidence of any impact on transactions or prices, although there is a predicted short term impact on new listings as sellers change the timings of their listings. The report concludes that the impact on listings is short lived and the impact on the market is marginal compared to the wider factors.
The Government also asked Europe Economics and Peter Williams of the National Housing and Planning Advice Unit (NHPAU) to consider whether changing housing market conditions meant we should change the approach to completing the roll out. They concluded that there are strong arguments for rolling out as planned, and further delay could cause greater market difficulties and uncertainties.
The implementation of HIPs so far and the work of the Stakeholder Panel have also highlighted further improvements needed to benefit consumers.
Early monitoring of HIPs has highlighted stakeholder concerns that for some consumers leasehold documents are proving hard to obtain quickly and, in some cases, disproportionate charges are being requested. In the majority of cases we would expect leasehold documents to be readily and easily available as part of HIPs. However, given the higher number of leasehold properties amongst one and two bedroom homes, to ensure a continued smooth roll out we will phase the introduction of leasehold information.
The Government will temporarily amend the HIP regulations so the lease document itself must be included, but other leasehold information will be introduced as a requirement in six months’ time.
The Government will also set out other consumer-first measures and will:
* ask Ted Beardsall, Deputy Chief Executive of the Land Registry — and member of our Home Buying and Selling Stakeholder Panel — to advise on what else could be done to improve the provision of leasehold information and the search process.
* publish guidance on access and charging in December for local authorities and personal searchers with the aim of speeding up searches and delivering a fairer deal for consumers.
* extend the temporary first day marketing provisions for an additional 6 months to allow for full flexibility — from 1 January to 1 June, to ensure continued smooth implementation of HIPs.
The introduction of HIPs is part of a wider programme of reforms to home buying and selling including e-conveyancing and better redress, which aims to provide consumers with a clearer, more transparent and effective service, with better value for money, benefiting all potential homebuyers and helping in tackling climate change.
Our early monitoring shows that implementation has gone relatively smoothly with HIPs taking on average 7-10 days to prepare; the majority of property and drainage and water searches being delivered within 5 days; Energy Performance Certificates (EPCs) taking on average 2-4 days to prepare; average property search costs falling, and thousands of people benefiting from the 200,000 EPCs which have been generated since the summer.
Communities and Local Government issued a press release and Ministerial Statement on the full roll-out of HIPs and supporting activity to ensure continued smooth implementation
GREEN RATINGS TO BENEFIT ALL HOME BUYERS
First time homebuyers will see their upfront costs drop and all home buyers will, for the first time, receive A-G green ratings for their properties which will help cut fuel bills and carbon emissions, with the roll out of Home Information Packs (HIPs) and Energy Performance Certificates (EPCs) announced today.
Buyers whose homes score poor energy ratings of F or G (currently around one-fifth of all homes) will receive an offer of a discount or free help with energy efficiency measures from the Green Homes Service which will be established, helping to save hundreds of pounds off fuel bills, as announced by the Prime Minister this week.
Sixty per cent of the market is already covered by HIPs. The Government has announced the rollout of HIPs and EPCs to the rest of the market from December 14 this year, as the criteria set out for roll out on 11 June have now been met.
House hunters will get detailed information about the energy efficiency of their home with a green rating of A-G, similar to consumer friendly fridge ratings, in an EPC.
The final stage of the roll out follows careful analysis of how HIPs and EPCs have been working in order to maintain their smooth introduction into the housing market.
The extension of HIPs to all properties will particularly benefit first time buyers through a reduction in their upfront costs by not having to pay for a pack, helping them in getting a foot on the housing ladder.
The packs are already beginning to bring benefits to consumers with average property search costs starting to fall with the new competition from HIPs – 85 local authorities have already reduced their charges by £30 on average.
Housing Minister Yvette Cooper said:
“HIPs and EPCs are already helping consumers to save hundreds of pounds off their fuel bills and are cutting search costs too. All home buyers will be able to benefit from energy efficiency advice, with those receiving low green ratings of ‘F’ and ‘G’ especially targeted for support and grants to make improvements to cut their costs and carbon emissions.”
Early monitoring of the scheme shows the roll out has gone smoothly.
* HIPs are taking on average 7 to 10 days to prepare
* The majority of property, and drainage and water searches, are being delivered promptly within 5 days
* EPCs are being prepared on average within 2 to 4 days
* The average cost of a pack is £300 to £350 – costs which apart from the new information included in the EPC are already part of the home buying and selling process.
The Government has also today published an independent report by Europe Economics on the impact of HIPs on the market. Their report finds no evidence of any impact on transactions or prices, although there is a predicted short term impact on new listings as sellers change the timings of their listings. The report concludes that the impact on listings is short lived and the impact on the market is marginal compared to the wider factors.
The Government also asked Europe Economics and Peter Williams of the National Housing and Planning Advice Unit (NHPAU) to consider whether changing housing market conditions meant we should change the approach to completing the roll out. They concluded that there are strong arguments for rolling out as planned, and further delay could cause greater market difficulties and uncertainties.
The implementation of HIPs so far and the work of the Stakeholder Panel have also highlighted further improvements needed to benefit consumers.
Early monitoring of HIPs has highlighted stakeholder concerns that for some consumers leasehold documents are proving hard to obtain quickly and, in some cases, disproportionate charges are being requested. In the majority of cases we would expect leasehold documents to be readily and easily available as part of HIPs. However, given the higher number of leasehold properties amongst one and two bedroom homes, to ensure a continued smooth roll out we will phase the introduction of leasehold information.
The Government will temporarily amend the HIP regulations so the lease document itself must be included, but other leasehold information will be introduced as a requirement in six months’ time.
The Government will also set out other consumer-first measures and will:
* ask Ted Beardsall, Deputy Chief Executive of the Land Registry — and member of our Home Buying and Selling Stakeholder Panel — to advise on what else could be done to improve the provision of leasehold information and the search process.
* publish guidance on access and charging in December for local authorities and personal searchers with the aim of speeding up searches and delivering a fairer deal for consumers.
* extend the temporary first day marketing provisions for an additional 6 months to allow for full flexibility — from 1 January to 1 June, to ensure continued smooth implementation of HIPs.
The introduction of HIPs is part of a wider programme of reforms to home buying and selling including e-conveyancing and better redress, which aims to provide consumers with a clearer, more transparent and effective service, with better value for money, benefiting all potential homebuyers and helping in tackling climate change.
Our early monitoring shows that implementation has gone relatively smoothly with HIPs taking on average 7-10 days to prepare; the majority of property and drainage and water searches being delivered within 5 days; Energy Performance Certificates (EPCs) taking on average 2-4 days to prepare; average property search costs falling, and thousands of people benefiting from the 200,000 EPCs which have been generated since the summer.
Tuesday, November 20, 2007
Body Corporate - Out, Owners Corporation - In
From 1 January 2008, there are changes big and small for body corporates in Victoria.
Obviously there will be many other changes, but the above will be reflected in the conveyancing process.
The upside for consumers, is the much needed transparancy when buying a flat, unit or apartment. Currently or before, it was a dogs breakfast regime in terms of disclosure of body corporate information.
The downside for the consumer is the increased costs ($55 vs $150) and double this if both parties indepedently obtain a copy of the s151 Certificate.
The other downside is the vendor cannot provide a vendor disclosure statement in a hurry. The Owners Corporation Manager can keep you waiting for up to 2 weeks being the mandated time they must produce the certificate. Take into account time lost for ordering and postage, it could be 3 weeks. The government should look at reducing the turnaround time to 5 business days.
Agents beware. If a vendor engages you to sell his flat or apartment, instructions to prepare sales documentation must be done then and there. Lawyers can no longer turn out vendor statements with minimum supporting documentation as has been done in the past. The practice of vendors waiting for a firm offer from a buyer before instructing a lawyer is now fraught with the danger of losing the buyer altogether. Ipso facto, you can potentially be giving the buyer a 17 day cooling off period, being the sum of the 3 day cooling off and 14 days waiting for a section 151 owners corporation certificate.
Its one step forward and two steps back.
Section 151 Owners Corporations Act 2006
Division 3-Owners Corporation Certificate
151. Owners corporation certificate
(1) Any person may apply to the owners corporation for an owners corporation certificate.
(2) The application must be in writing and must be accompanied by the prescribed fee.
Note: The Electronic Transactions (Victoria) Act 2000 - enables this application to be made electronically.
(3) The owners corporation must issue an owners corporation certificate within 10 business days after it receives an application and fee under this section.
(4) An owners corporation certificate must
(a) contain the prescribed information relating to the owners corporation and a lot which must include the prescribed information relating to
(i) fees payable in respect of the lot;
(ii) fees and charges that are imposed or proposed to be imposed on the lot;
(iii) fees and other money owing in respect of the lot;
(iv) insurance;
(v) repairs and maintenance;
(vi) the funds held by the owners corporation;
(vii) liabilities and contingent liabilities of the owners corporation including any liabilities or contingent liabilities arising from legal proceedings;
(viii) contracts, leases, licences and agreements affecting the common property;
(ix) services provided to lot owners and occupiers and the public;
(x) notices and orders served on the owners corporation;
(xi) legal proceedings to which the owners corporation is a party;
(xii) the manager;
(xiii) any appointment of an administrator; and
(b) be accompanied by
(i) a copy of the rules, or, if the rules have been amended the consolidated rules of the owners corporation as recorded on the Register; and
(ii) a statement in the prescribed form providing advice and information to prospective purchasers and lot owners; and
(iii) a copy of all resolutions made at the last annual general meeting of the owners corporation; and
(iv) any other documents of a prescribed kind; and
(v) a statement advising that further information on prescribed matters can be obtained by inspection of the owners corporation register.
PART 15—AMENDMENT OF SALE OF LAND ACT 1962
219. Section 32 certificate
(1) Section 32(2)(h) of the Sale of Land Act 1962 is repealed.
(2) After section 32(3) of the Sale of Land Act 1962 insert—
"(3A) If the land is affected by an owners corporation within the meaning of the Owners Corporations Act 2006, the vendor must attach to the statement required by subsection
(1)(a) and to the contract—
(a) a copy of the current owners corporation certificate issued in respect of the land under the Owners Corporations Act 2006; and
(b) a copy of the documents required to accompany the owners corporation certificate under section 151(4)(b) of the Owners Corporations Act 2006.".
146. Availability of records
(1) The owners corporation, on request by a lot owner, a mortgagee of a lot, a purchaser of a lot or the representative of a lot owner or mortgagee or purchaser of a lot, must make the records of the owners corporation required to be kept under this
Division available to that person for inspection at any reasonable time, free of charge.
(2) The owners corporation may at the request of a person entitled to inspect the records and on payment of a reasonable fee provide a copy of any record of the owners corporation.
2-lot subdivisions
s.7 deals with 2 lot subdivisions and make certain exemptions for compliance under the Act. The anomoly is that even tho' you dont have to have insurance, you dont have to keep records &c. but when selling you must still provide a S.151 Certificate. Go figure.
- Body Corporates will be renamed Owners Corporation.
- Every Section 32 Vendors Statement must contain a Section 151 Owners Corporation Certificate, being the old Form 3. It will not just be an option. It is mandatory. It will be a combination of the old Form 3 and the Minutes of the last Annual General Meeting.
- The Section 151 Owners Corporation Certificate will cost $150, up from $55
Obviously there will be many other changes, but the above will be reflected in the conveyancing process.
The upside for consumers, is the much needed transparancy when buying a flat, unit or apartment. Currently or before, it was a dogs breakfast regime in terms of disclosure of body corporate information.
The downside for the consumer is the increased costs ($55 vs $150) and double this if both parties indepedently obtain a copy of the s151 Certificate.
The other downside is the vendor cannot provide a vendor disclosure statement in a hurry. The Owners Corporation Manager can keep you waiting for up to 2 weeks being the mandated time they must produce the certificate. Take into account time lost for ordering and postage, it could be 3 weeks. The government should look at reducing the turnaround time to 5 business days.
Agents beware. If a vendor engages you to sell his flat or apartment, instructions to prepare sales documentation must be done then and there. Lawyers can no longer turn out vendor statements with minimum supporting documentation as has been done in the past. The practice of vendors waiting for a firm offer from a buyer before instructing a lawyer is now fraught with the danger of losing the buyer altogether. Ipso facto, you can potentially be giving the buyer a 17 day cooling off period, being the sum of the 3 day cooling off and 14 days waiting for a section 151 owners corporation certificate.
Its one step forward and two steps back.
Section 151 Owners Corporations Act 2006
Division 3-Owners Corporation Certificate
151. Owners corporation certificate
(1) Any person may apply to the owners corporation for an owners corporation certificate.
(2) The application must be in writing and must be accompanied by the prescribed fee.
Note: The Electronic Transactions (Victoria) Act 2000 - enables this application to be made electronically.
(3) The owners corporation must issue an owners corporation certificate within 10 business days after it receives an application and fee under this section.
(4) An owners corporation certificate must
(a) contain the prescribed information relating to the owners corporation and a lot which must include the prescribed information relating to
(i) fees payable in respect of the lot;
(ii) fees and charges that are imposed or proposed to be imposed on the lot;
(iii) fees and other money owing in respect of the lot;
(iv) insurance;
(v) repairs and maintenance;
(vi) the funds held by the owners corporation;
(vii) liabilities and contingent liabilities of the owners corporation including any liabilities or contingent liabilities arising from legal proceedings;
(viii) contracts, leases, licences and agreements affecting the common property;
(ix) services provided to lot owners and occupiers and the public;
(x) notices and orders served on the owners corporation;
(xi) legal proceedings to which the owners corporation is a party;
(xii) the manager;
(xiii) any appointment of an administrator; and
(b) be accompanied by
(i) a copy of the rules, or, if the rules have been amended the consolidated rules of the owners corporation as recorded on the Register; and
(ii) a statement in the prescribed form providing advice and information to prospective purchasers and lot owners; and
(iii) a copy of all resolutions made at the last annual general meeting of the owners corporation; and
(iv) any other documents of a prescribed kind; and
(v) a statement advising that further information on prescribed matters can be obtained by inspection of the owners corporation register.
PART 15—AMENDMENT OF SALE OF LAND ACT 1962
219. Section 32 certificate
(1) Section 32(2)(h) of the Sale of Land Act 1962 is repealed.
(2) After section 32(3) of the Sale of Land Act 1962 insert—
"(3A) If the land is affected by an owners corporation within the meaning of the Owners Corporations Act 2006, the vendor must attach to the statement required by subsection
(1)(a) and to the contract—
(a) a copy of the current owners corporation certificate issued in respect of the land under the Owners Corporations Act 2006; and
(b) a copy of the documents required to accompany the owners corporation certificate under section 151(4)(b) of the Owners Corporations Act 2006.".
146. Availability of records
(1) The owners corporation, on request by a lot owner, a mortgagee of a lot, a purchaser of a lot or the representative of a lot owner or mortgagee or purchaser of a lot, must make the records of the owners corporation required to be kept under this
Division available to that person for inspection at any reasonable time, free of charge.
(2) The owners corporation may at the request of a person entitled to inspect the records and on payment of a reasonable fee provide a copy of any record of the owners corporation.
2-lot subdivisions
s.7 deals with 2 lot subdivisions and make certain exemptions for compliance under the Act. The anomoly is that even tho' you dont have to have insurance, you dont have to keep records &c. but when selling you must still provide a S.151 Certificate. Go figure.
Monday, November 19, 2007
Go Phil, It may just be your last hoorah
IT is too early to know for sure, but it is beginning to look as if Philip Ruddock might have done it again.
If the states have finally decided to take a statesmanlike approach to electronic conveyancing, it might well be due to the veiled threat of some bullying from the commonwealth.
Ruddock never threatened to take over e-conveyancing if the states were unable to agree on a real national system. He didn't have to.
Merely mentioning e-conveyancing in the same breath as defamation reform - implemented under threat of a commonwealth takeover - was enough to get his message across.
The states, particularly NSW and Victoria, have been working hard to reach agreement. So it might be selling them short to give Ruddock all the credit.
But on their performance to date, the states need to be judged by their actions on e-conveyancing - not their words.
Before Ruddock entered this debate it had been characterised by parochialism and a refusal to give the private-sector users of conveyancing what they wanted.
State ministers and their top bureaucrats now appear to be focused on a national approach.
The apparent change is reflected in a draft statement that has been endorsed by Victoria, NSW and South Australia. The key change is that heads of government departments - the most senior state bureaucrats - will now be taking a direct interest in e-conveyancing and will be regularly talking to each other.
But there is a big unknown. Lawyers, conveyancers and bankers are not part of this high-powered group. Their involvement is through the organisation known as National Electronic Conveyancing System (NECS), which also has representatives of the state governments.
NECS is the organisation that is responsible for building the national e-conveyancing system. If the new committee of department heads works with NECS, the initiative might ensure that petty squabbles by junior bureaucrats - or even outside contractors - are stamped on before they cause problems.
But if the new committee attempts to sideline NECS it will mean that the state governments are, in reality, sidelining business. At the first sign of such a course, solicitors and non-lawyer conveyancers - as well as the banks - would be justified in making a fuss.
The only direct private-sector involvement in the establishment of a national e-conveyancing system is through NECS. Without the NECS process, there is a risk that e-conveyancing could become the plaything of public servants, who, with the greatest respect, have no idea about what business wants or needs.
The private sector, and not state governments, is the main player in e-conveyancing, and the draft statement from the states shows positive signs of recognising that fact.
The most positive aspect of that draft statement is that it uses the word "seamless" twice to describe the nature of the national e-conveyancing system that should be built.
The most negative aspect of the statement is the single use of the phrase "nationally consistent" to describe the same system.
"Consistent" is another way of describing a federation of state-based systems - not a single, seamless system.
It could be a mere glitch, but it means the private users of conveyancing still need to keep a very close eye on the states.
The next step is real action by the states towards developing a true, seamless system - as demanded by all of the private users of conveyancing.
PREJUDICE: Chris Merritt | November 16, 2007
The Australian
If the states have finally decided to take a statesmanlike approach to electronic conveyancing, it might well be due to the veiled threat of some bullying from the commonwealth.
Ruddock never threatened to take over e-conveyancing if the states were unable to agree on a real national system. He didn't have to.
Merely mentioning e-conveyancing in the same breath as defamation reform - implemented under threat of a commonwealth takeover - was enough to get his message across.
The states, particularly NSW and Victoria, have been working hard to reach agreement. So it might be selling them short to give Ruddock all the credit.
But on their performance to date, the states need to be judged by their actions on e-conveyancing - not their words.
Before Ruddock entered this debate it had been characterised by parochialism and a refusal to give the private-sector users of conveyancing what they wanted.
State ministers and their top bureaucrats now appear to be focused on a national approach.
The apparent change is reflected in a draft statement that has been endorsed by Victoria, NSW and South Australia. The key change is that heads of government departments - the most senior state bureaucrats - will now be taking a direct interest in e-conveyancing and will be regularly talking to each other.
But there is a big unknown. Lawyers, conveyancers and bankers are not part of this high-powered group. Their involvement is through the organisation known as National Electronic Conveyancing System (NECS), which also has representatives of the state governments.
NECS is the organisation that is responsible for building the national e-conveyancing system. If the new committee of department heads works with NECS, the initiative might ensure that petty squabbles by junior bureaucrats - or even outside contractors - are stamped on before they cause problems.
But if the new committee attempts to sideline NECS it will mean that the state governments are, in reality, sidelining business. At the first sign of such a course, solicitors and non-lawyer conveyancers - as well as the banks - would be justified in making a fuss.
The only direct private-sector involvement in the establishment of a national e-conveyancing system is through NECS. Without the NECS process, there is a risk that e-conveyancing could become the plaything of public servants, who, with the greatest respect, have no idea about what business wants or needs.
The private sector, and not state governments, is the main player in e-conveyancing, and the draft statement from the states shows positive signs of recognising that fact.
The most positive aspect of that draft statement is that it uses the word "seamless" twice to describe the nature of the national e-conveyancing system that should be built.
The most negative aspect of the statement is the single use of the phrase "nationally consistent" to describe the same system.
"Consistent" is another way of describing a federation of state-based systems - not a single, seamless system.
It could be a mere glitch, but it means the private users of conveyancing still need to keep a very close eye on the states.
The next step is real action by the states towards developing a true, seamless system - as demanded by all of the private users of conveyancing.
PREJUDICE: Chris Merritt | November 16, 2007
The Australian
Friday, November 16, 2007
Electronic system closer
THE states are about to establish a high-powered committee of government officials aimed at streamlining work towards a seamless national system of electronic conveyancing.
The committee, made up of the heads of government departments, is the centrepiece of an agreement between the states on the way forward for electronic conveyancing.
The governments of NSW, Victoria and South Australia have endorsed a draft statement outlining principles that will govern the development of "a seamless national electronic conveyancing system".
Other states are considering endorsing the statement of principles.
The draft statement is intended to send a clear signal to lawyers, banks and non-lawyer conveyancers that the states have united to develop a system that meets the needs of the private sector and government agencies. Private sector users of conveyancing will not be part of the new committee but will be consulted.
Lawyers, the Australian Bankers Association and conveyancers remain part of another organisation, the National Electronic Conveyancing System, which has been charged by the states with building a national e-conveyancing system.
A Victorian government spokeswoman said the new group was not intended to replace any existing organisation.
The push for a national agreement between the states was an initiative of the Victorian minister responsible for electronic conveyancing, Environment Minister Gavin Jennings. He has been working closely with his NSW counterpart, Lands Minister Tony Kelly. The initiative, which could be made public as early as today, has come to light soon after last week's warning to the states from federal Attorney-General Philip Ruddock, who has urged the states to settle their differences over the establishment of e-conveyancing.
The initiative coincides with today's launch of the next stage of Victoria's e-conveyancing system, known as ECV. Big banks are boycotting ECV due to lack of progress on developing a national system.
Chris Merritt | November 16, 2007
The Australian
The committee, made up of the heads of government departments, is the centrepiece of an agreement between the states on the way forward for electronic conveyancing.
The governments of NSW, Victoria and South Australia have endorsed a draft statement outlining principles that will govern the development of "a seamless national electronic conveyancing system".
Other states are considering endorsing the statement of principles.
The draft statement is intended to send a clear signal to lawyers, banks and non-lawyer conveyancers that the states have united to develop a system that meets the needs of the private sector and government agencies. Private sector users of conveyancing will not be part of the new committee but will be consulted.
Lawyers, the Australian Bankers Association and conveyancers remain part of another organisation, the National Electronic Conveyancing System, which has been charged by the states with building a national e-conveyancing system.
A Victorian government spokeswoman said the new group was not intended to replace any existing organisation.
The push for a national agreement between the states was an initiative of the Victorian minister responsible for electronic conveyancing, Environment Minister Gavin Jennings. He has been working closely with his NSW counterpart, Lands Minister Tony Kelly. The initiative, which could be made public as early as today, has come to light soon after last week's warning to the states from federal Attorney-General Philip Ruddock, who has urged the states to settle their differences over the establishment of e-conveyancing.
The initiative coincides with today's launch of the next stage of Victoria's e-conveyancing system, known as ECV. Big banks are boycotting ECV due to lack of progress on developing a national system.
Chris Merritt | November 16, 2007
The Australian
Monday, November 12, 2007
Snazzy online property advertisements
IF you’re shopping for a new home, it’s easy to take a virtual stroll through the ranch house at 640 Hobart Avenue, San Mateo, Calif., asking price $1,049,000. The house has its own Web site, complete with a soundtrack (www.640hobart.com). Click on it and a real estate agent welcomes you in the voiceover, as crisp digital photographs of the sunny rooms flow past on the screen, with each photo neatly dovetailed to the narration.
A house in San Mateo, Calif., was sold within a week after its own Web site was posted, using the VizzVox service to create a smoothly narrated tour.
The commercial may make you want to move in instantly. But, too bad, that house is sold. Joanne Norris, an agent at Alain Pinel Realtors in Burlingame, Calif., who created and narrated the commercial, found a buyer within a week of advertising it that way. She sold another house, too, within a few days of posting a Web commercial, despite an overall slowdown in the local housing market.
To make the commercials, Mrs. Norris used a new Web-based service, VizzVox (www.vizzvox.com). For $149 a year, VizzVox offers a package that includes domain name registration for the property, hosting of the commercial on the Web site for a year, and the use of the Web-based software that lets real estate agents create the presentation.
“It’s an affordable way to make and distribute commercials,” said Robert W. Beth, co-founder and chief executive of VizzVox. “We think this is an opportunity for individuals to create ads and level the playing field with big companies.”
Real estate agents who use the service upload digital photographs and video clips to the VizzVox site, turn on a microphone and talk about the selling points of the home and the neighborhood. After they describe each visual, software smoothly stitches together the images and narrative. The program has a remix feature, so that agents can create variations on each commercial, including views of dog parks for one prospective buyer, and local schools for another. The presentations can be made and viewed both on Macs and PCs, preferably with broadband connections. Traffic is driven to the site with signs, ads and real estate listings.
Drew Neisser, chief executive of Renegade Marketing in Manhattan, who is in the business of inventive online marketing and Web site development himself, was intrigued with the service. “It’s extremely cost effective,” he said. He looked at two VizzVox commercials and liked them: “They told a lovely story about each home — I was ready at the end to call my wife and tell her we were moving to San Mateo.”
The service may provide an attractive alternative to more complicated and expensive approaches used to sell homes, like high-definition video or 360-degree panoramic photos. Creating a high-quality video is fairly expensive. Mike Raspatello, director of marketing at Richter Studios in Chicago, which does videos for real estate brokers, said the cost for a three-minute high-definition video of a single home typically ran $6,000 to $15,000.
Mr. Neisser says the VizzVox commercials “are a convenient way to get a quick and reasonably accurate tour.” But however attractive some of the commercials may be, he said, he doesn’t think do-it-yourself programs like VizzVox are a threat to more traditional marketing services.
“The problem with a technology like this is that you are putting semiprofessional tools in the hands of an amateur,” he said. “One of the reasons folks like us are still in business is that we are professional storytellers. I can’t imagine that your average real estate agent has the quality of voice and ability to draft a narrative that is compelling and interesting.”
To meet that challenge, VizzVox offers professional production assistance. For example, real estate agents can provide images and notes on a property, and VizzVox will produce a script and a voiceover artist to read it for $120.
In additional to real estate programs, VizzVox also sells a general service for $149 a year that lets individuals create presentations, store them on a company server and display them by way of a link. Parents, for example, might use the service to create a narrative celebrating the birth of a child. Artists might show off their portfolios, and business owners might create commercials about their products. Links to the presentations can be placed anywhere on the Web, pasted into a MySpace page, for instance, or at the end of e-mail messages.
Another VizzVox service lets individuals create up to 10 presentations free at its site, but their creations will be shown with ads: after the slide show, for instance, there may be an ad asking viewers to shop at an online retailer.
NYT
By ANNE EISENBERG
Published: November 11, 2007
A house in San Mateo, Calif., was sold within a week after its own Web site was posted, using the VizzVox service to create a smoothly narrated tour.
The commercial may make you want to move in instantly. But, too bad, that house is sold. Joanne Norris, an agent at Alain Pinel Realtors in Burlingame, Calif., who created and narrated the commercial, found a buyer within a week of advertising it that way. She sold another house, too, within a few days of posting a Web commercial, despite an overall slowdown in the local housing market.
To make the commercials, Mrs. Norris used a new Web-based service, VizzVox (www.vizzvox.com). For $149 a year, VizzVox offers a package that includes domain name registration for the property, hosting of the commercial on the Web site for a year, and the use of the Web-based software that lets real estate agents create the presentation.
“It’s an affordable way to make and distribute commercials,” said Robert W. Beth, co-founder and chief executive of VizzVox. “We think this is an opportunity for individuals to create ads and level the playing field with big companies.”
Real estate agents who use the service upload digital photographs and video clips to the VizzVox site, turn on a microphone and talk about the selling points of the home and the neighborhood. After they describe each visual, software smoothly stitches together the images and narrative. The program has a remix feature, so that agents can create variations on each commercial, including views of dog parks for one prospective buyer, and local schools for another. The presentations can be made and viewed both on Macs and PCs, preferably with broadband connections. Traffic is driven to the site with signs, ads and real estate listings.
Drew Neisser, chief executive of Renegade Marketing in Manhattan, who is in the business of inventive online marketing and Web site development himself, was intrigued with the service. “It’s extremely cost effective,” he said. He looked at two VizzVox commercials and liked them: “They told a lovely story about each home — I was ready at the end to call my wife and tell her we were moving to San Mateo.”
The service may provide an attractive alternative to more complicated and expensive approaches used to sell homes, like high-definition video or 360-degree panoramic photos. Creating a high-quality video is fairly expensive. Mike Raspatello, director of marketing at Richter Studios in Chicago, which does videos for real estate brokers, said the cost for a three-minute high-definition video of a single home typically ran $6,000 to $15,000.
Mr. Neisser says the VizzVox commercials “are a convenient way to get a quick and reasonably accurate tour.” But however attractive some of the commercials may be, he said, he doesn’t think do-it-yourself programs like VizzVox are a threat to more traditional marketing services.
“The problem with a technology like this is that you are putting semiprofessional tools in the hands of an amateur,” he said. “One of the reasons folks like us are still in business is that we are professional storytellers. I can’t imagine that your average real estate agent has the quality of voice and ability to draft a narrative that is compelling and interesting.”
To meet that challenge, VizzVox offers professional production assistance. For example, real estate agents can provide images and notes on a property, and VizzVox will produce a script and a voiceover artist to read it for $120.
In additional to real estate programs, VizzVox also sells a general service for $149 a year that lets individuals create presentations, store them on a company server and display them by way of a link. Parents, for example, might use the service to create a narrative celebrating the birth of a child. Artists might show off their portfolios, and business owners might create commercials about their products. Links to the presentations can be placed anywhere on the Web, pasted into a MySpace page, for instance, or at the end of e-mail messages.
Another VizzVox service lets individuals create up to 10 presentations free at its site, but their creations will be shown with ads: after the slide show, for instance, there may be an ad asking viewers to shop at an online retailer.
NYT
By ANNE EISENBERG
Published: November 11, 2007
Saturday, November 10, 2007
ECV - Almost Live: Demo
November 16, 2007 is D Day for EC's vaunted Release 2.0
If you want a preview, EC released a demonstration CD. Here's a sample of the Vendor module from the disk. Here's a sample of the Purchase Model.
EC's launch as the industry knows has been waylaid by the withdrawal of the Big 4 and no sign off yet by the Lawyers LPLC.
Anyhow, we now have the benefit of having a peek under the bonnet as EC have released a demonstration disk giving us a video of a sample file.
First thoughts. The vid gives you the feel you are filling out a e-tax form, which didn't make me feel too good about this release. The visual interface looks like it needs a makeover. BUt then again this is just a demo vid.
The digital signing part looks great. The double authentication gives me confidence that it wont be easy for an outsider to hack.
The bit that I bet will make many of us feel a bit queasy is entering in all the bank account details for disbursement of cheques (whoops, I mean funds). No cheques here. We are going to have to obtain bank account details, enter them, check and re-check them. I know this is the future, but. I dont like the responsibility. Can we cut and past bank account details that clients supply us? I dont know but can we store commonly used bank account details, like our office or trust account?
Have a look at the demo I have posted and leave a comment on what you think.
Electronic Conveyancing Demonstration 07.11.07
You want a copy of the disk. Perhaps email ec at landexchange.vic.gov.au
Or ring them on 03 8636 2625
If you want a preview, EC released a demonstration CD. Here's a sample of the Vendor module from the disk. Here's a sample of the Purchase Model.
EC's launch as the industry knows has been waylaid by the withdrawal of the Big 4 and no sign off yet by the Lawyers LPLC.
Anyhow, we now have the benefit of having a peek under the bonnet as EC have released a demonstration disk giving us a video of a sample file.
First thoughts. The vid gives you the feel you are filling out a e-tax form, which didn't make me feel too good about this release. The visual interface looks like it needs a makeover. BUt then again this is just a demo vid.
The digital signing part looks great. The double authentication gives me confidence that it wont be easy for an outsider to hack.
The bit that I bet will make many of us feel a bit queasy is entering in all the bank account details for disbursement of cheques (whoops, I mean funds). No cheques here. We are going to have to obtain bank account details, enter them, check and re-check them. I know this is the future, but. I dont like the responsibility. Can we cut and past bank account details that clients supply us? I dont know but can we store commonly used bank account details, like our office or trust account?
Have a look at the demo I have posted and leave a comment on what you think.
Electronic Conveyancing Demonstration 07.11.07
You want a copy of the disk. Perhaps email ec at landexchange.vic.gov.au
Or ring them on 03 8636 2625
Friday, November 09, 2007
Attorney-General, Philip Ruddock,
Ruddock was all about building a brave new tomorrow, such as the "harmonisation" of our laws. In particular, he said, he was passionate about harmonising the various statutes dealing with personal property security, electronic conveyancing, evidence, statutory declarations and powers of attorney.
Importantly, he had a "vision" about reducing red tape. Wow. It can't get much more exciting than that, surely.
Extract from debate between Ruddock and shadow Labor Senator Joe Ludwig.
Richard Ackland - SMH
November 9, 2007
Importantly, he had a "vision" about reducing red tape. Wow. It can't get much more exciting than that, surely.
Extract from debate between Ruddock and shadow Labor Senator Joe Ludwig.
Richard Ackland - SMH
November 9, 2007
Thursday, November 08, 2007
Digital Signatures in Electronic Conveyancing
Electronic Conveyancing in NSW
Please Note
The information in this newsletter is correct at time of publication but may change as the project develops. It reflects current thinking to generate discussion and feedback and is not a substitute for publication of Circulars announcing policy changes.
Digital Signatures in Electronic Conveyancing
Digital signature certificates are an essential requirement of electronic conveyancing. They replace manual signatures used on paper instruments to identify the person taking responsibility for the correctness of the information contained in an electronic instrument.
What are digital signatures?
A digital signature certificate is an electronic fingerprint that identifies the person to whom it was issued. It is an electronic record that identifies the person by name and other details as well as the organisation vouching for the person’s identity. When applied to an electronic instrument, the signature certificate tells the Land Registry who certified and signed the instrument.
Why are they necessary?
Digital signatures are necessary in electronic conveyancing to replace the traditional manual signatures on paper instruments identifying the person taking responsibility for the correctness of the instrument’s information. They allow the authenticity of the signature to be independently verified electronically as valid and belonging to the person named by it, and therefore for the entire instrument to be examined electronically.
How do you get one?
Digital signature certificates are purchased from private sector suppliers. To get one it is necessary first to have your identity independently verified in a similar manner to that necessary before opening a new bank account. After satisfying the identity verification requirement and paying the required fee, the signature certificate is delivered over the Internet or by mail. Signature certificates generally need to be renewed every two years.
Who can issue one?
Digital signature certificates suitable for electronic conveyancing can only be issued by a supplier accredited under the Commonwealth Government’s Gatekeeper program. This ensures the supplier’s security arrangements and procedures are sound and reliable. Details of the Gatekeeper program are available at http://www.agimo.gov.au/infrastructure/gatekeeper.
What do they cost?
Digital signature certificates from a Gatekeeper-accredited supplier cost between $100 and $200 each for a two-year validity period depending upon the type of certificate required. Current GST-inclusive pricing from one supplier is available at
http://www.verisign.com.au/gatekeeper/pricing.shtml
How will they be used?
Digital signature certificates will be used in signing instruments, information reports and settlement statements in NECS. When the instrument, report or statement has been certified by confirming each of the required certifications presented by the system, the signing procedure will be made available. To sign, a person registered with NECS as a Certifier must enter their digital signature certificate password (different from their NECS user-id password and not known to NECS). When the password is verified correct, the NECS system verifies the signature certificate with the Gatekeeper-accredited supplier who issued it to ensure it is valid and unrevoked, then adds the certificate to the instrument, report or statement as the verified identity of the person who certified and signed it. The signature certificate then becomes and inseparable part of the instrument, report or statement. Any organisation, such as a Land Registry or Revenue Office, receiving a certified and signed instrument or report can independently verify the included signature certificate with the supplier who issued it.
What should be done to keep them secure?
Digital signature certificates can be stored on the fixed hard-drive of computers or on removable storage devices such as a smartcard or USB memory stick. The person to whom the signature certificate is issued is responsible for its security. If a certificate stored on a shared computer is used by someone else to fraudulently certify and sign an instrument, report or statement, the responsibility for that certification and signing rests with the person to whom the certificate was issued.
For security reasons, storage of signature certificates on removable devices, such as a smartcard or USB memory stick, which can be kept under the responsible person’s control at all times is preferred and highly recommended. It is possible professional conduct regulations associated with electronic conveyancing may oblige legal practitioners and licensed conveyancers to store their signature certificates on such devices.
Please Note
The information in this newsletter is correct at time of publication but may change as the project develops. It reflects current thinking to generate discussion and feedback and is not a substitute for publication of Circulars announcing policy changes.
Digital Signatures in Electronic Conveyancing
Digital signature certificates are an essential requirement of electronic conveyancing. They replace manual signatures used on paper instruments to identify the person taking responsibility for the correctness of the information contained in an electronic instrument.
What are digital signatures?
A digital signature certificate is an electronic fingerprint that identifies the person to whom it was issued. It is an electronic record that identifies the person by name and other details as well as the organisation vouching for the person’s identity. When applied to an electronic instrument, the signature certificate tells the Land Registry who certified and signed the instrument.
Why are they necessary?
Digital signatures are necessary in electronic conveyancing to replace the traditional manual signatures on paper instruments identifying the person taking responsibility for the correctness of the instrument’s information. They allow the authenticity of the signature to be independently verified electronically as valid and belonging to the person named by it, and therefore for the entire instrument to be examined electronically.
How do you get one?
Digital signature certificates are purchased from private sector suppliers. To get one it is necessary first to have your identity independently verified in a similar manner to that necessary before opening a new bank account. After satisfying the identity verification requirement and paying the required fee, the signature certificate is delivered over the Internet or by mail. Signature certificates generally need to be renewed every two years.
Who can issue one?
Digital signature certificates suitable for electronic conveyancing can only be issued by a supplier accredited under the Commonwealth Government’s Gatekeeper program. This ensures the supplier’s security arrangements and procedures are sound and reliable. Details of the Gatekeeper program are available at http://www.agimo.gov.au/infrastructure/gatekeeper.
What do they cost?
Digital signature certificates from a Gatekeeper-accredited supplier cost between $100 and $200 each for a two-year validity period depending upon the type of certificate required. Current GST-inclusive pricing from one supplier is available at
http://www.verisign.com.au/gatekeeper/pricing.shtml
How will they be used?
Digital signature certificates will be used in signing instruments, information reports and settlement statements in NECS. When the instrument, report or statement has been certified by confirming each of the required certifications presented by the system, the signing procedure will be made available. To sign, a person registered with NECS as a Certifier must enter their digital signature certificate password (different from their NECS user-id password and not known to NECS). When the password is verified correct, the NECS system verifies the signature certificate with the Gatekeeper-accredited supplier who issued it to ensure it is valid and unrevoked, then adds the certificate to the instrument, report or statement as the verified identity of the person who certified and signed it. The signature certificate then becomes and inseparable part of the instrument, report or statement. Any organisation, such as a Land Registry or Revenue Office, receiving a certified and signed instrument or report can independently verify the included signature certificate with the supplier who issued it.
What should be done to keep them secure?
Digital signature certificates can be stored on the fixed hard-drive of computers or on removable storage devices such as a smartcard or USB memory stick. The person to whom the signature certificate is issued is responsible for its security. If a certificate stored on a shared computer is used by someone else to fraudulently certify and sign an instrument, report or statement, the responsibility for that certification and signing rests with the person to whom the certificate was issued.
For security reasons, storage of signature certificates on removable devices, such as a smartcard or USB memory stick, which can be kept under the responsible person’s control at all times is preferred and highly recommended. It is possible professional conduct regulations associated with electronic conveyancing may oblige legal practitioners and licensed conveyancers to store their signature certificates on such devices.
Monday, November 05, 2007
Misuse of LIV Copyright forms
From LIV - Friday Facts
"The LIV is aware that some practitioners have altered or misused LIV forms which are sold in hard copy or electronic format, either by photocopying, cutting and pasting large amounts of text into their own documents or using the document ostensibly in its original form but with modifications which are not immediately apparent. These practices are a breach of the LIV's copyright in the documents and have the potential to mislead fellow practitioners who can reasonably expect that the original standard form of document has been used. Changes to any of the provisions in LIV forms should always be made by special conditions which refer to additions or deletions. If you are aware of any practitioners who have altered or misused LIV copyright forms, please report the matter and provide copies of the documents to LIV CEO Mike Brett Young" by email to ceo@liv.asn.au
I have personally come across one or two instances of the boilerplate LIV General Conditions having been amended. Such a practice is in my view misleading. DO such practitioners expect any other lawyer to have to read the General Conditions line by line to see if there have been any unexpected changes?
"The LIV is aware that some practitioners have altered or misused LIV forms which are sold in hard copy or electronic format, either by photocopying, cutting and pasting large amounts of text into their own documents or using the document ostensibly in its original form but with modifications which are not immediately apparent. These practices are a breach of the LIV's copyright in the documents and have the potential to mislead fellow practitioners who can reasonably expect that the original standard form of document has been used. Changes to any of the provisions in LIV forms should always be made by special conditions which refer to additions or deletions. If you are aware of any practitioners who have altered or misused LIV copyright forms, please report the matter and provide copies of the documents to LIV CEO Mike Brett Young" by email to ceo@liv.asn.au
I have personally come across one or two instances of the boilerplate LIV General Conditions having been amended. Such a practice is in my view misleading. DO such practitioners expect any other lawyer to have to read the General Conditions line by line to see if there have been any unexpected changes?
Vic rapped on attitude to e-system
Les Taylor is still confident that a national system of electronic conveyancing will be achieved, writes Legal affairs editor Chris Merritt | November 02, 2007
THE organisation charged with developing a national electronic conveyancing system has accused Victoria of trying to "torpedo" the new system.
Les Taylor, who chairs the organisation known as the National Electronic Conveyancing System, said Victoria was trying to replace the planned national system with a network of state-based systems.
In an interview with The Australian, Mr Taylor has delivered a withering attack on Victoria's behaviour during negotiations aimed at establishing a national conveyancing system.
"I liken this very much to the problems incurred in the 1800s with different railway gauges," he said.
He was still confident that a national system of electronic conveyancing would be achieved, but he accused Victoria of reneging on an agreement to help build the system.
Instead, he said Victoria was trying to impose a federation of state-based systems that lack the support of banks and lawyers.
Mr Taylor, who is a former general counsel for the Commonwealth Bank, had reneged on its promise to hand over all the intellectual property underpinning its own electronic conveyancing system, known as ECV.
Mr Taylor, who is now overseas, made his criticism of Victoria before talks this week aimed at clearing the way for the establishment of a national e-conveyancing system.
As part of those talks, an agreement has been made on preconditions that Victoria had been insisting on before making available source codes for the software underpinning its e-conveyancing system.
Mr Taylor said Victoria had agreed in June at a meeting of the NECS steering committee to hand over those source codes so the system could be assessed by NSW officials.
Victorian officials had agreed to hand over the codes so NSW "could do a proper evaluation in order to determine what changes would be necessary if the Victorian model was used as a basis for an electronic system in NSW, and then Australia-wide".
A spokeswoman for Gavin Jennings, the minister responsible for e-conveyancing in Victoria, said the states were continuing to work on delivering "a nationally consistent system, as has been the objective for several years".
Victoria and Queensland believed the national e-conveyancing project was on track, the spokeswoman said.
Mr Taylor said the Queensland Government had endorsed a national model of e-conveyancing in June but now "seems to have joined forces with Victoria in an attempt to torpedo the national project and impose a federated model".
Mr Taylor said the Law Council and the state law societies had taken the same stance as the banks and wanted a seamless electronic conveyancing system covering the nation, rather than eight separate systems.
He said an external review of the Victorian system had been conducted last year for the NECS steering committee.
"It concluded that the Victorian system was not really capable of being transferred and incorporated into a national system," Mr Taylor said.
But he said this assessment was limited because Victoria had again refused to hand over source codes and other intellectual property associated with the ECV system.
THE organisation charged with developing a national electronic conveyancing system has accused Victoria of trying to "torpedo" the new system.
Les Taylor, who chairs the organisation known as the National Electronic Conveyancing System, said Victoria was trying to replace the planned national system with a network of state-based systems.
In an interview with The Australian, Mr Taylor has delivered a withering attack on Victoria's behaviour during negotiations aimed at establishing a national conveyancing system.
"I liken this very much to the problems incurred in the 1800s with different railway gauges," he said.
He was still confident that a national system of electronic conveyancing would be achieved, but he accused Victoria of reneging on an agreement to help build the system.
Instead, he said Victoria was trying to impose a federation of state-based systems that lack the support of banks and lawyers.
Mr Taylor, who is a former general counsel for the Commonwealth Bank, had reneged on its promise to hand over all the intellectual property underpinning its own electronic conveyancing system, known as ECV.
Mr Taylor, who is now overseas, made his criticism of Victoria before talks this week aimed at clearing the way for the establishment of a national e-conveyancing system.
As part of those talks, an agreement has been made on preconditions that Victoria had been insisting on before making available source codes for the software underpinning its e-conveyancing system.
Mr Taylor said Victoria had agreed in June at a meeting of the NECS steering committee to hand over those source codes so the system could be assessed by NSW officials.
Victorian officials had agreed to hand over the codes so NSW "could do a proper evaluation in order to determine what changes would be necessary if the Victorian model was used as a basis for an electronic system in NSW, and then Australia-wide".
A spokeswoman for Gavin Jennings, the minister responsible for e-conveyancing in Victoria, said the states were continuing to work on delivering "a nationally consistent system, as has been the objective for several years".
Victoria and Queensland believed the national e-conveyancing project was on track, the spokeswoman said.
Mr Taylor said the Queensland Government had endorsed a national model of e-conveyancing in June but now "seems to have joined forces with Victoria in an attempt to torpedo the national project and impose a federated model".
Mr Taylor said the Law Council and the state law societies had taken the same stance as the banks and wanted a seamless electronic conveyancing system covering the nation, rather than eight separate systems.
He said an external review of the Victorian system had been conducted last year for the NECS steering committee.
"It concluded that the Victorian system was not really capable of being transferred and incorporated into a national system," Mr Taylor said.
But he said this assessment was limited because Victoria had again refused to hand over source codes and other intellectual property associated with the ECV system.
Sunday, November 04, 2007
Where do you really want to live?
I'll be honest. I want to live within 15 kilometers from the city, in a south eastern or bayside suburb. With a couple of kids, we consider ourselves Mr and Mrs Average. Me, I am a working suburban lawyer and the misses works part time. I don't aspire to live in Caroline Springs or Fountain Gate neither suburb being close to family, friends or place of work.
I have just read the latest update from the National Real Estate Institute, "The average new home loan of $247,455 doesn’t provide for McMansion style housing, but for a basic family home." So that's the average home loan, that is causing all the stress about mortgage stress. I would kill for a $247,455 home loan. Because where I want to live that is not even going to cover for a 1 bedroom flat.
Without being too fancy, I have picked on finding a house in Bentleigh which is close to where I grew up and to where I work. It is not exactly an aspirational suburb but it is near enough to suburbs that would qualify for such a tag.
The latest facts and figures on Bentleigh are -
Lower Quartile $600,000
Median $700,000
Upper Quartile $807,000
Annual change 34.6%
If I can pick up my dream (not aspirational) home, I need to budget on paying $700,000 and being conservative I will only borrow 80% of the purchase price. I don't really want to pay mortgage insurance. Stamp duty, government fees and legals alone add $40,000 to the equation.
Price $700K
Mortgage $560K
Deposit $181K
Interest Rate 8%
Term 25 years
Monthly payment $4,322
Annual repayments $52,000
How does this accord with the reported average new loan of $248K ?
Bentleigh in my childhood (1960s) was just pretty average. About 10 to 15 years ago, Bentleigh saw a great influx of young parents with numbers of kids and toddlers swelling the numbers at kindergartens, creches and the local schools. Bentleigh was for generations affordable.
I find it hard to see this being repeated today.
PS If you were to buy the 700K house in Bentleigh with a $248K mortgage, you would need close to a $500K deposit. Mum, I need a loan. Son, start saving.
I have just read the latest update from the National Real Estate Institute, "The average new home loan of $247,455 doesn’t provide for McMansion style housing, but for a basic family home." So that's the average home loan, that is causing all the stress about mortgage stress. I would kill for a $247,455 home loan. Because where I want to live that is not even going to cover for a 1 bedroom flat.
Without being too fancy, I have picked on finding a house in Bentleigh which is close to where I grew up and to where I work. It is not exactly an aspirational suburb but it is near enough to suburbs that would qualify for such a tag.
The latest facts and figures on Bentleigh are -
Lower Quartile $600,000
Median $700,000
Upper Quartile $807,000
Annual change 34.6%
If I can pick up my dream (not aspirational) home, I need to budget on paying $700,000 and being conservative I will only borrow 80% of the purchase price. I don't really want to pay mortgage insurance. Stamp duty, government fees and legals alone add $40,000 to the equation.
Price $700K
Mortgage $560K
Deposit $181K
Interest Rate 8%
Term 25 years
Monthly payment $4,322
Annual repayments $52,000
How does this accord with the reported average new loan of $248K ?
Bentleigh in my childhood (1960s) was just pretty average. About 10 to 15 years ago, Bentleigh saw a great influx of young parents with numbers of kids and toddlers swelling the numbers at kindergartens, creches and the local schools. Bentleigh was for generations affordable.
I find it hard to see this being repeated today.
PS If you were to buy the 700K house in Bentleigh with a $248K mortgage, you would need close to a $500K deposit. Mum, I need a loan. Son, start saving.
Friday, November 02, 2007
Electronic property plan hits roadblock
ON Wednesday Tony Kelly thought the efforts of his top bureaucrats had finally achieved a breakthrough.
Kelly, the NSW Minister for Lands, had sent Warwick Watkins, the director general of his department, to Melbourne to sort out the feud that threatens to derail the establishment of a national system of electronic conveyancing.
The news appeared to be good. Kelly thought Victoria had returned to the fold and embraced the idea of a single national system -- the model favoured by the Australian Bankers Association, lawyers and non-lawyer conveyancers.
"There is no impasse. We are determined to get on and have a national system, and that is exactly what the ABA wants," Kelly said.
In the past few weeks, Kelly has been deeply involved in trying to smooth the way for a national e-conveyancing system. He has spoken to the ABA, Westpac and the Victorian minister responsible for e-conveyancing, Gavin Jennings.
"I had my director general go down and see his and they have agreed to move on. They have convened a meeting of all the directors general involved, to ensure they move forward."
Victorian officials, however, have a very different understanding of what came out of this week's talks, and it all came down to one word.
Jennings' spokeswoman said officials from the two states had agreed the goal was "a nationally consistent" system.
The word to watch is "consistent". It means the agreement between NSW and Victoria is at best incremental and at worst illusory.
A nationally consistent system, in the view of Jennings' spokeswoman, is a network of eight separate state-based e-conveyancing systems, preferably based on Victoria's Electronic Conveyancing Victoria (ECV) system.
"It is what Victoria has wanted all along," she said.
Despite that misunderstanding, there was some positive news from the talks. Kelly's office says Victoria has agreed to make the inner workings of its system available to NSW for assessment.
Until now, Victoria has only handed over a demonstration version of ECV and has been hanging on to the source code and supporting material. Victorian officials feared that NSW would simply examine their system and reject it. They have accused NSW of harbouring ambitions to control e-conveyancing nationally.
Victoria has been insisting on agreement in advance on the criteria NSW will use to assess ECV's viability. Kelly's office says agreement has been reached on that process and the next step will be when Victoria hands over the source code.
NSW and Victoria both say they want a national system, but the way forward will be complicated by Victoria's push for a federated structure.
Victoria has a lot at stake with ECV. The government has invested about $40 million in building the system and, those who have used it say it works well within the state.
The trouble starts at the border. The competing model for the national future of e-conveyancing -- a single seamless system -- enjoys the support of lawyers, banks and conveyancers. Together, these groups are the key private-sector parties with an interest in conveyancing. Without them, no e-conveyancing system can be viable.
Because of Victoria's different approach to the national future of conveyancing, the big banks are boycotting ECV. Unless they return, the Victorian system looks set to become a $40 million white elephant.
The state government knew about that risk long ago. Documents obtained by The Australian show that the state government was warned last December that its e-conveyancing system was incapable of being used as a single national system.
The warning was issued by independent consultants Daniel Brewer and Michael Bolton after the state government had spent $20 million on ECV.
The warning about the shortcomings of the Victorian system is recorded in the minutes of the organisation responsible for building the national e-conveyancing system, the National Electronic Conveyancing System (NECS), which consists of representatives of the state and territory governments, the Law Council, the Australian Institute of Conveyancers and the Australian Bankers Association.
NECS had commissioned an independent report on how ECV would fit into the planned national system being developed by NECS. Victoria developed ECV while part of NECS.
NECS has agreed to base the new national system, as far as possible, on the Victorian system. The minutes of the December meeting of the NECS steering committee show Victorian government official Genevieve Overell was present when the adverse report on ECV was discussed.
Brewer and Bolton found that the parts of ECV for settlement of conveyancing transactions "can be easily reused to meet the NECS requirements" for a single national system, but the shortcomings came to light when they examined the system's lodgment functions.
"It has been specifically designed for Victorian requirements and the underlying architecture is inadequate to satisfactorily meet the requirements of NECS for a national multi-jurisdictional system," the consultants said.
The minutes of the December meeting state: "Michael Bolton's view was that, in relation to the lodgment stage, it would be better to start constructing a system from scratch than trying to build around the ECV system to accommodate other jurisdictions' unique requirements."
After receiving that report, Victoria's Overell suggested another opinion be sought "given that Victoria has invested $20 million in the project".
Others at the meeting were, however, concerned about delaying the establishment of a national system.
Victoria's system might be a good standalone system for one state but "it will not suit the banking or legal market to structure ECV for each jurisdiction, as we will end up with a number of similar systems but not one national system", they said.
One of the points made at the meeting after the adverse report on ECV was that "evolution of ECV into NECS is important and it has to be through political agreement, including paying Victoria fair compensation".
The minutes of the next meeting, in March, show that NECS chairman Les Taylor "explained that it had not been an easy time of late and that everyone has tried to take into account the Victorian situation, noting that he does not want anyone to lose money".
"However, he confirmed that it was the banks that said at the outset that they would not support eight different systems, and that gave impetus to the national project."
The minutes of other NECS meetings, also obtained by The Australian, show Victorian government representatives repeatedly committed themselves to the NECS business plan of a single national electronic conveyancing system.
The June minutes show that "Queensland undertook a joint study with Victoria to see if ECV could handle Queensland's requirements".
The study found that "the design and architecture of ECV would appear flexible enough to be modified to meet forseeable requirements of the jurisdictions and NECS".
However, Australian Bankers Association director Ian Gilbert raised concerns about the scope of that assessment. He "noted that the results of the Queensland testing were to find out the ability of ECV to be modified from a land titles perspective and not from the perspective of other stakeholders, such as the banks".
He told the meeting that the banks had "serious concerns" about the development of two disparate processes.
"This resulted in the banks deciding to suspend further participation with ECV until there is a clear single way forward," the minutes say.
"He expressed concern about material emanating from Victoria since April representing that the banks are working with ECV.
"The banks have not changed their position since 2004, when they stated that 'banks support a national electronic system that will deliver a seamless, interoperable, flexible, electronic settlement and lodgment system that can accommodate inter-jurisdictional differences'," the minutes say.
Within Victoria, ECV is intended eventually to deliver cost savings of up to $395 on each transaction, according to government estimates.
Those savings have been placed at risk not by any flaw in ECV but because Victoria still hopes to build a federation of ECVs nationally instead of a single system.
Even if public servants around the country find a network of ECVs attractive, the reality is that their opinions do not matter. The private sector is the key to conveyancing and the main players in the private sector want something that Victoria is not offering.
The banks withdrew from ECV in protest at Victoria's lack of co-operation with the push to establish a single national system.
To justify their investment in e-conveyancing, the banks want the same system rolled out nationally. They want to deal with one system, not eight.
The Victorian government has now manoeuvred itself into a position where it desperately needs the banks to return to ECV, but it is pushing ahead with plans that have driven the banks away.
Unless the deadlock is broken, ordinary Victorians look set to pay a high price. Without the banks, the state government's $40 million investment is at risk of remaining relatively idle because most transactions will still be paper-based.
Because the state government has also increased government charges on paper-based conveyancing by up to 32 per cent, Victorians will soon be familiar with the ECV effect, even if they never go anywhere near the system.
The fee hike was intended to drive transactions to ECV, but none of that will work unless the banks' concerns are addressed.
In the final weeks before the launch of the latest version of ECV, Victorian officials say they are talking to three banks attracted to the idea of eight separate e-conveyancing systems.
The state government is also involved in negotiations aimed at addressing the concerns of the Legal Practitioners' Liability Committee about the new system. Those concerns triggered a warning from the Law Institute of Victoria that it could not recommend solicitors' participation in the system.
If these talks fail, Victorians might soon be asking the state government why it spent $40 million building a system that few of those in the business of conveyancing are prepared to use.
Chris Merritt, Legal affairs editor | November 02, 2007 The Australian
Kelly, the NSW Minister for Lands, had sent Warwick Watkins, the director general of his department, to Melbourne to sort out the feud that threatens to derail the establishment of a national system of electronic conveyancing.
The news appeared to be good. Kelly thought Victoria had returned to the fold and embraced the idea of a single national system -- the model favoured by the Australian Bankers Association, lawyers and non-lawyer conveyancers.
"There is no impasse. We are determined to get on and have a national system, and that is exactly what the ABA wants," Kelly said.
In the past few weeks, Kelly has been deeply involved in trying to smooth the way for a national e-conveyancing system. He has spoken to the ABA, Westpac and the Victorian minister responsible for e-conveyancing, Gavin Jennings.
"I had my director general go down and see his and they have agreed to move on. They have convened a meeting of all the directors general involved, to ensure they move forward."
Victorian officials, however, have a very different understanding of what came out of this week's talks, and it all came down to one word.
Jennings' spokeswoman said officials from the two states had agreed the goal was "a nationally consistent" system.
The word to watch is "consistent". It means the agreement between NSW and Victoria is at best incremental and at worst illusory.
A nationally consistent system, in the view of Jennings' spokeswoman, is a network of eight separate state-based e-conveyancing systems, preferably based on Victoria's Electronic Conveyancing Victoria (ECV) system.
"It is what Victoria has wanted all along," she said.
Despite that misunderstanding, there was some positive news from the talks. Kelly's office says Victoria has agreed to make the inner workings of its system available to NSW for assessment.
Until now, Victoria has only handed over a demonstration version of ECV and has been hanging on to the source code and supporting material. Victorian officials feared that NSW would simply examine their system and reject it. They have accused NSW of harbouring ambitions to control e-conveyancing nationally.
Victoria has been insisting on agreement in advance on the criteria NSW will use to assess ECV's viability. Kelly's office says agreement has been reached on that process and the next step will be when Victoria hands over the source code.
NSW and Victoria both say they want a national system, but the way forward will be complicated by Victoria's push for a federated structure.
Victoria has a lot at stake with ECV. The government has invested about $40 million in building the system and, those who have used it say it works well within the state.
The trouble starts at the border. The competing model for the national future of e-conveyancing -- a single seamless system -- enjoys the support of lawyers, banks and conveyancers. Together, these groups are the key private-sector parties with an interest in conveyancing. Without them, no e-conveyancing system can be viable.
Because of Victoria's different approach to the national future of conveyancing, the big banks are boycotting ECV. Unless they return, the Victorian system looks set to become a $40 million white elephant.
The state government knew about that risk long ago. Documents obtained by The Australian show that the state government was warned last December that its e-conveyancing system was incapable of being used as a single national system.
The warning was issued by independent consultants Daniel Brewer and Michael Bolton after the state government had spent $20 million on ECV.
The warning about the shortcomings of the Victorian system is recorded in the minutes of the organisation responsible for building the national e-conveyancing system, the National Electronic Conveyancing System (NECS), which consists of representatives of the state and territory governments, the Law Council, the Australian Institute of Conveyancers and the Australian Bankers Association.
NECS had commissioned an independent report on how ECV would fit into the planned national system being developed by NECS. Victoria developed ECV while part of NECS.
NECS has agreed to base the new national system, as far as possible, on the Victorian system. The minutes of the December meeting of the NECS steering committee show Victorian government official Genevieve Overell was present when the adverse report on ECV was discussed.
Brewer and Bolton found that the parts of ECV for settlement of conveyancing transactions "can be easily reused to meet the NECS requirements" for a single national system, but the shortcomings came to light when they examined the system's lodgment functions.
"It has been specifically designed for Victorian requirements and the underlying architecture is inadequate to satisfactorily meet the requirements of NECS for a national multi-jurisdictional system," the consultants said.
The minutes of the December meeting state: "Michael Bolton's view was that, in relation to the lodgment stage, it would be better to start constructing a system from scratch than trying to build around the ECV system to accommodate other jurisdictions' unique requirements."
After receiving that report, Victoria's Overell suggested another opinion be sought "given that Victoria has invested $20 million in the project".
Others at the meeting were, however, concerned about delaying the establishment of a national system.
Victoria's system might be a good standalone system for one state but "it will not suit the banking or legal market to structure ECV for each jurisdiction, as we will end up with a number of similar systems but not one national system", they said.
One of the points made at the meeting after the adverse report on ECV was that "evolution of ECV into NECS is important and it has to be through political agreement, including paying Victoria fair compensation".
The minutes of the next meeting, in March, show that NECS chairman Les Taylor "explained that it had not been an easy time of late and that everyone has tried to take into account the Victorian situation, noting that he does not want anyone to lose money".
"However, he confirmed that it was the banks that said at the outset that they would not support eight different systems, and that gave impetus to the national project."
The minutes of other NECS meetings, also obtained by The Australian, show Victorian government representatives repeatedly committed themselves to the NECS business plan of a single national electronic conveyancing system.
The June minutes show that "Queensland undertook a joint study with Victoria to see if ECV could handle Queensland's requirements".
The study found that "the design and architecture of ECV would appear flexible enough to be modified to meet forseeable requirements of the jurisdictions and NECS".
However, Australian Bankers Association director Ian Gilbert raised concerns about the scope of that assessment. He "noted that the results of the Queensland testing were to find out the ability of ECV to be modified from a land titles perspective and not from the perspective of other stakeholders, such as the banks".
He told the meeting that the banks had "serious concerns" about the development of two disparate processes.
"This resulted in the banks deciding to suspend further participation with ECV until there is a clear single way forward," the minutes say.
"He expressed concern about material emanating from Victoria since April representing that the banks are working with ECV.
"The banks have not changed their position since 2004, when they stated that 'banks support a national electronic system that will deliver a seamless, interoperable, flexible, electronic settlement and lodgment system that can accommodate inter-jurisdictional differences'," the minutes say.
Within Victoria, ECV is intended eventually to deliver cost savings of up to $395 on each transaction, according to government estimates.
Those savings have been placed at risk not by any flaw in ECV but because Victoria still hopes to build a federation of ECVs nationally instead of a single system.
Even if public servants around the country find a network of ECVs attractive, the reality is that their opinions do not matter. The private sector is the key to conveyancing and the main players in the private sector want something that Victoria is not offering.
The banks withdrew from ECV in protest at Victoria's lack of co-operation with the push to establish a single national system.
To justify their investment in e-conveyancing, the banks want the same system rolled out nationally. They want to deal with one system, not eight.
The Victorian government has now manoeuvred itself into a position where it desperately needs the banks to return to ECV, but it is pushing ahead with plans that have driven the banks away.
Unless the deadlock is broken, ordinary Victorians look set to pay a high price. Without the banks, the state government's $40 million investment is at risk of remaining relatively idle because most transactions will still be paper-based.
Because the state government has also increased government charges on paper-based conveyancing by up to 32 per cent, Victorians will soon be familiar with the ECV effect, even if they never go anywhere near the system.
The fee hike was intended to drive transactions to ECV, but none of that will work unless the banks' concerns are addressed.
In the final weeks before the launch of the latest version of ECV, Victorian officials say they are talking to three banks attracted to the idea of eight separate e-conveyancing systems.
The state government is also involved in negotiations aimed at addressing the concerns of the Legal Practitioners' Liability Committee about the new system. Those concerns triggered a warning from the Law Institute of Victoria that it could not recommend solicitors' participation in the system.
If these talks fail, Victorians might soon be asking the state government why it spent $40 million building a system that few of those in the business of conveyancing are prepared to use.
Chris Merritt, Legal affairs editor | November 02, 2007 The Australian
Wednesday, October 31, 2007
Why are interest rates going up - Tim Colebatch explains
WHEN interest rates were low, the Howard Government claimed the credit, and was given it by grateful voters. Now that rates have risen, and are set to rise still higher, should it take the blame?
In part, no. In part, yes. Interest rates in Australia were bound to rise. Some of the factors that have pushed them up were desirable, others unforeseeable. And in two crucial areas, it has taken pressure off interest rates.
But interest rates have risen more than they would have had the Government treated "keeping interest rates low" as a policy priority, and not just a slogan. It has neglected key jobs, thrown money where it buys votes rather than where the economy needs it, and turned off the "automatic stabilisers" by which budget policy usually takes pressure off interest rates.
As Access Economics director Chris Richardson put it recently: "The Government is throwing money into the economy and the Reserve Bank is taking it out again. We have one foot on the accelerator and the other on the brake. No wonder we're blowing smoke."
There are more important issues for the economy, but certainly there is no economic issue more important for voters. The average new home loan in Melbourne is now approaching $250,000. Add the five interest rate rises since the 2004 election, the sixth likely next month, the seventh expected early next year, and the banks' plans to raise margins, and the monthly payments on that loan would be up almost $400 a month since John Howard pledged to keep interest rates low.
Howard keeps pointing out that they were higher in the past, and so they were. But the people who remember the 17 per cent rates are not the ones paying big mortgages now. They remember when mortgage rates were 6 per cent. Now they are looking at paying 9 per cent. Talking about what went wrong in the 1980s won't solve that.
Nor can the Government credibly use its old line that interest rates are higher here because we are growing and the rest of the world isn't. The International Monetary Fund has just updated its database, and it shows that between 1996 and 2006, of 30 advanced economies, Australia ranked exactly 15th in economic growth per head. The economy overall grew 14th fastest out of the 30 over that decade. Our unemployment rate is now the equal 14th lowest of the 30. A standout? Not us: we are the average Western country.
The Government can defend its record on three grounds. First, as Peter Costello keeps telling us, growth is the goal of economic policy — and one of the things growth does is that it raises interest rates. As the economy grows, fewer resources are left unused, competition for them increases, and their price rises. We could let prices rise to create an inflationary spiral — or try to ration resources by raising interest rates. That's the low-cost option.
Second, Australia's economy has been hit by an X-factor that no one saw coming: the mining boom. Last year half of all the growth in construction across the country was in Western Australia. Mining investment has more than doubled in two years, and is still surging. In mining and construction in the west, everything is in short supply, prices are rising rapidly, and the ripples are reaching the east too.
Third, as Costello and Howard now concede, WorkChoices was designed to slow the pace of wage growth. Tilt the bargaining rules in favour of the employer, as they have done, and you get smaller wage rises and hence less inflationary pressure. Whether it is fair or unfair is another matter, but as Reserve Bank Governor Glenn Stevens says, anything that frees up the labour market helps to hold down inflation.
The same is true of the controversial section 457 visas used to bring in contract workers from overseas wherever employers identify shortages. While it would be better to retrain some of the million or more Australians who are unemployed, underemployed or prematurely retired, it is a low-cost way to cut through inflationary bottlenecks.
But in other ways, the Howard Government has made inflation worse, and helped push interest rates up. On skills training, it dropped the ball in its first budget. Many of its cost savings came from scrapping Working Nation, set up by the Keating government to retrain the unemployed so that, as recovery came, Australia would have the skilled workers to meet its needs. That ball remained dropped until recently.
In 2005-06, the OECD Employment Outlook records, Australia invested just 0.04 per cent of its GDP in training the unemployed, the third lowest among the OECD's 25 rich members. By then, skills shortages were already acute. Skills shortages cause wage rises which cause inflation which causes higher interest rates. On this one, Howard's Government has no excuse.
Second, instead of using budget policy to ease pressure on interest rates, as in the past, Howard has increased the pressure by shovelling money into voters' pockets while the Reserve tries to slow their spending. On Treasury projections, personal income tax will shrink from 12.1 per cent of GDP in 2004-05 to just 10.3 per cent in 2008-09 — adding $20 billion a year to consumers' spending power.
In past booms, monetary and fiscal policy have worked together. More jobs and higher wages increased tax revenues, reducing the need for rate rises to slow the economy. Now the Government has dropped its end so it can deliver big tax cuts.
That means interest rates have to do all the work. So as taxes go lower, rates go higher.
Tim Colebatch is The Age economics editor.
This story was found at: http://www.theage.com.au/articles/2007/10/29/1193618793576.html
In part, no. In part, yes. Interest rates in Australia were bound to rise. Some of the factors that have pushed them up were desirable, others unforeseeable. And in two crucial areas, it has taken pressure off interest rates.
But interest rates have risen more than they would have had the Government treated "keeping interest rates low" as a policy priority, and not just a slogan. It has neglected key jobs, thrown money where it buys votes rather than where the economy needs it, and turned off the "automatic stabilisers" by which budget policy usually takes pressure off interest rates.
As Access Economics director Chris Richardson put it recently: "The Government is throwing money into the economy and the Reserve Bank is taking it out again. We have one foot on the accelerator and the other on the brake. No wonder we're blowing smoke."
There are more important issues for the economy, but certainly there is no economic issue more important for voters. The average new home loan in Melbourne is now approaching $250,000. Add the five interest rate rises since the 2004 election, the sixth likely next month, the seventh expected early next year, and the banks' plans to raise margins, and the monthly payments on that loan would be up almost $400 a month since John Howard pledged to keep interest rates low.
Howard keeps pointing out that they were higher in the past, and so they were. But the people who remember the 17 per cent rates are not the ones paying big mortgages now. They remember when mortgage rates were 6 per cent. Now they are looking at paying 9 per cent. Talking about what went wrong in the 1980s won't solve that.
Nor can the Government credibly use its old line that interest rates are higher here because we are growing and the rest of the world isn't. The International Monetary Fund has just updated its database, and it shows that between 1996 and 2006, of 30 advanced economies, Australia ranked exactly 15th in economic growth per head. The economy overall grew 14th fastest out of the 30 over that decade. Our unemployment rate is now the equal 14th lowest of the 30. A standout? Not us: we are the average Western country.
The Government can defend its record on three grounds. First, as Peter Costello keeps telling us, growth is the goal of economic policy — and one of the things growth does is that it raises interest rates. As the economy grows, fewer resources are left unused, competition for them increases, and their price rises. We could let prices rise to create an inflationary spiral — or try to ration resources by raising interest rates. That's the low-cost option.
Second, Australia's economy has been hit by an X-factor that no one saw coming: the mining boom. Last year half of all the growth in construction across the country was in Western Australia. Mining investment has more than doubled in two years, and is still surging. In mining and construction in the west, everything is in short supply, prices are rising rapidly, and the ripples are reaching the east too.
Third, as Costello and Howard now concede, WorkChoices was designed to slow the pace of wage growth. Tilt the bargaining rules in favour of the employer, as they have done, and you get smaller wage rises and hence less inflationary pressure. Whether it is fair or unfair is another matter, but as Reserve Bank Governor Glenn Stevens says, anything that frees up the labour market helps to hold down inflation.
The same is true of the controversial section 457 visas used to bring in contract workers from overseas wherever employers identify shortages. While it would be better to retrain some of the million or more Australians who are unemployed, underemployed or prematurely retired, it is a low-cost way to cut through inflationary bottlenecks.
But in other ways, the Howard Government has made inflation worse, and helped push interest rates up. On skills training, it dropped the ball in its first budget. Many of its cost savings came from scrapping Working Nation, set up by the Keating government to retrain the unemployed so that, as recovery came, Australia would have the skilled workers to meet its needs. That ball remained dropped until recently.
In 2005-06, the OECD Employment Outlook records, Australia invested just 0.04 per cent of its GDP in training the unemployed, the third lowest among the OECD's 25 rich members. By then, skills shortages were already acute. Skills shortages cause wage rises which cause inflation which causes higher interest rates. On this one, Howard's Government has no excuse.
Second, instead of using budget policy to ease pressure on interest rates, as in the past, Howard has increased the pressure by shovelling money into voters' pockets while the Reserve tries to slow their spending. On Treasury projections, personal income tax will shrink from 12.1 per cent of GDP in 2004-05 to just 10.3 per cent in 2008-09 — adding $20 billion a year to consumers' spending power.
In past booms, monetary and fiscal policy have worked together. More jobs and higher wages increased tax revenues, reducing the need for rate rises to slow the economy. Now the Government has dropped its end so it can deliver big tax cuts.
That means interest rates have to do all the work. So as taxes go lower, rates go higher.
Tim Colebatch is The Age economics editor.
This story was found at: http://www.theage.com.au/articles/2007/10/29/1193618793576.html
Tuesday, October 30, 2007
Web 2.0? Don't bank on it just yet
AUSTRALIAN bank infrastructure is "not robust enough" to deliver secure web 2.0 banking and financial services.
That's the warning last week's Future of Banking and Financial Services event in Sydney heard but demand and overseas influence will change how banking is done, delegates were told.
Bank of Queensland chief information officer Iain Blacklaw said such plans captured the imagination but for his bank web 2.0 is "at the furthest edges of the radar screen".
Compared to call centres, ATMs or eftpos "internet banking is the most pervasive but with the least stability. I wonder if the next generation has exponentially more risks?"
He said "Australian banks are not robust enough at the infrastructure level" for the financial services explored overseas where they use wikis - collaborative websites - that invite customers to participate in financial product design.
Wells Fargo built a bank in the virtual world of Second Life and, closer to home, AMP is testing an online environment where customers use avatars - virtual representations of themselves - to try products.
Some commentators believe new classes of financial services will emerge, such as the peer-to-peer lending pioneered by zopa.com.
Executive general manager of IT and management services at Challenger Derek Goh and Goldman Sachs JB Were CIO Richard Tait said that web 2.0 services for Australians were far off.
But Mr Tait said some collaborative tools were good for the bank's use.
"(We are) trying to get people to collaborate and come up with things that will make a lot of money," he said. But legal obligations could stymie some information-sharing tools.
Geoff Wenborn, general manager of technology and innovation at NAB, said banks could not afford to ignore customer expectations of interactive banking tools.
"We have to be able to invest in and provide a robust and secure back end while meeting our regulatory obligations (and) making it open and easy to use.
"It is an enormous challenge," he said.
It is a challenge that Michael Neary, Telstra's enterprise and government industry director, said the finance sector must tackle because there was a sea change in consumer expectations.
"Banking was once a place you go, now it's far more a thing that you do," Dr Neary said.
Telstra research found 4.95 million Australians wanted access to mobile banking services and the mobile phone may replace card payment systems, he said.
Next year's Telstra pilot with Visa and NAB demonstrated at the conference will have about 250 Melburnians use their mobile phones to pay for items less than $35. This sort of payments system was also in demand overseas: Japan has 43,000 terminals that takepayments from mobile phones, Dr Neary said.
But the shift to new technology will be hampered by the skills drought.
Many financial institutions at the conference said it was difficult to find and keep IT staff but they were divided as to whether offshoring was the best solution.
Suncorp CIO Jeff Smith - overseeing the $355 million two to three year program to integrate Suncorp and Promina's information systems - was a DIY proponent. "We aim to have as much in-house as possible," he said, adding that intellectual property was among a bank's greatest assets.
He said offshoring did not lend itself to supporting more agile organisations where there were six-month projects and smaller teams, which was increasingly the case in the financial sector.
Like Suncorp the Bank of Queensland keeps as much IT work as possible in Australia.
And although his was part of a global organisation, Mr Tait claimed that "offshoring is not part of our agenda".
"If we are not sitting on the same floor as the business guys as they are thinking things through then it's a problem," he said. Being even a floor above or below the business team could lead to a mismatch between IT strategy and business plans, he said.
And he questioned the wisdom of more offshoring.
"The real issue with offshoring is are we cutting off our feeder stock for IT management?
"It could be a significant issue for us."
Beverley Head
October 30, 2007
This story was found at: http://www.theage.com.au/articles/2007/10/29/1193618795944.html
That's the warning last week's Future of Banking and Financial Services event in Sydney heard but demand and overseas influence will change how banking is done, delegates were told.
Bank of Queensland chief information officer Iain Blacklaw said such plans captured the imagination but for his bank web 2.0 is "at the furthest edges of the radar screen".
Compared to call centres, ATMs or eftpos "internet banking is the most pervasive but with the least stability. I wonder if the next generation has exponentially more risks?"
He said "Australian banks are not robust enough at the infrastructure level" for the financial services explored overseas where they use wikis - collaborative websites - that invite customers to participate in financial product design.
Wells Fargo built a bank in the virtual world of Second Life and, closer to home, AMP is testing an online environment where customers use avatars - virtual representations of themselves - to try products.
Some commentators believe new classes of financial services will emerge, such as the peer-to-peer lending pioneered by zopa.com.
Executive general manager of IT and management services at Challenger Derek Goh and Goldman Sachs JB Were CIO Richard Tait said that web 2.0 services for Australians were far off.
But Mr Tait said some collaborative tools were good for the bank's use.
"(We are) trying to get people to collaborate and come up with things that will make a lot of money," he said. But legal obligations could stymie some information-sharing tools.
Geoff Wenborn, general manager of technology and innovation at NAB, said banks could not afford to ignore customer expectations of interactive banking tools.
"We have to be able to invest in and provide a robust and secure back end while meeting our regulatory obligations (and) making it open and easy to use.
"It is an enormous challenge," he said.
It is a challenge that Michael Neary, Telstra's enterprise and government industry director, said the finance sector must tackle because there was a sea change in consumer expectations.
"Banking was once a place you go, now it's far more a thing that you do," Dr Neary said.
Telstra research found 4.95 million Australians wanted access to mobile banking services and the mobile phone may replace card payment systems, he said.
Next year's Telstra pilot with Visa and NAB demonstrated at the conference will have about 250 Melburnians use their mobile phones to pay for items less than $35. This sort of payments system was also in demand overseas: Japan has 43,000 terminals that takepayments from mobile phones, Dr Neary said.
But the shift to new technology will be hampered by the skills drought.
Many financial institutions at the conference said it was difficult to find and keep IT staff but they were divided as to whether offshoring was the best solution.
Suncorp CIO Jeff Smith - overseeing the $355 million two to three year program to integrate Suncorp and Promina's information systems - was a DIY proponent. "We aim to have as much in-house as possible," he said, adding that intellectual property was among a bank's greatest assets.
He said offshoring did not lend itself to supporting more agile organisations where there were six-month projects and smaller teams, which was increasingly the case in the financial sector.
Like Suncorp the Bank of Queensland keeps as much IT work as possible in Australia.
And although his was part of a global organisation, Mr Tait claimed that "offshoring is not part of our agenda".
"If we are not sitting on the same floor as the business guys as they are thinking things through then it's a problem," he said. Being even a floor above or below the business team could lead to a mismatch between IT strategy and business plans, he said.
And he questioned the wisdom of more offshoring.
"The real issue with offshoring is are we cutting off our feeder stock for IT management?
"It could be a significant issue for us."
Beverley Head
October 30, 2007
This story was found at: http://www.theage.com.au/articles/2007/10/29/1193618795944.html
Rebellion frustrates e-conveyance
VICTORIA and Queensland have threatened to go it alone on their land title and property transfer systems, but banks and the industry say they're not interested in dealing with players outside the agreed National Electronic Conveyancing System.
Australian Bankers Association director Ian Gilbert said the banks were "dismayed" there had been "alternative discussions" between the states outside the joint initiative to form a central communications exchange.
Victoria, which is to launch its own e-conveyancing system on November 16, has refused to share its software with other states unless they agree to certain conditions.
Mr Gilbert said the banks had invested with the Victorian Government in developing the software, "with the expectation that it would find its way into the national process and, eventually, into a national system. At this juncture, that hasn't happened."
The fate of the $44 million e-conveyancing project is uncertain since the major banks pulled out in September, citing frustration over Victoria's flagging commitment to NECS.
A co-operative venture between state government agencies and industry, NECS aims to establish a nationwide exchange and settlement platform for real estate transactions by 2010.
Simon Libbis, executive director of the National Electronic Conveyancing Office, said all parties had agreed to develop common data standards, and in May engaged the Lending Industry XML Initiative (LIXI) to assist with its mortgage and bank processing expertise.
"With eight land registries and the banks, lawyers and conveyancing firms, it's fairly clear we couldn't get everyone to change their systems to meet the requirements of a central system," he said.
"The whole idea of NECS was to have a system that allows all those systems to talk to each other."
Mr Libbis said five jurisdictions and NECO had signed the agreement with LIXI, and it was understood the ACT was in the process of signing.
"Victoria and Queensland have given us no indication of their plans, so we're working on the basis they don't intend to sign," he said.
"Every other state is strongly supportive as well as the industry, particularly the lending institutions, so we are just getting on with it," he said. "The announcement of our death was a bit exaggerated".
A NECO steering committee meeting will be held in Brisbane on November 23, and the rebel states' alternative position would be discussed then.
The ABA's Mr Gilbert said a national e-conveyancing system required more than just a piece of software: there had to be a governance structure, rules for participation and common data standards to support the process.
"It's recognised the system will need flexibility to accommodate the different state requirements, but there's a core piece that could operate in a fairly standardised way," he said.
"For users, it's important that there should be seamless interoperability across the jurisdictions, with a single point of entry."
Victoria and Queensland were essentially suggesting a return to a state-centric approach, with each jurisdiction using similar software but without the nationwide interoperability.
Mr Gilbert said bankers wanted the NECS steering committee to "bring everybody back to the original focus", and "work collaboratively towards delivering" an e-conveyancing system.
Karen Dearne | October 30, 2007
The Australian IT
Australian Bankers Association director Ian Gilbert said the banks were "dismayed" there had been "alternative discussions" between the states outside the joint initiative to form a central communications exchange.
Victoria, which is to launch its own e-conveyancing system on November 16, has refused to share its software with other states unless they agree to certain conditions.
Mr Gilbert said the banks had invested with the Victorian Government in developing the software, "with the expectation that it would find its way into the national process and, eventually, into a national system. At this juncture, that hasn't happened."
The fate of the $44 million e-conveyancing project is uncertain since the major banks pulled out in September, citing frustration over Victoria's flagging commitment to NECS.
A co-operative venture between state government agencies and industry, NECS aims to establish a nationwide exchange and settlement platform for real estate transactions by 2010.
Simon Libbis, executive director of the National Electronic Conveyancing Office, said all parties had agreed to develop common data standards, and in May engaged the Lending Industry XML Initiative (LIXI) to assist with its mortgage and bank processing expertise.
"With eight land registries and the banks, lawyers and conveyancing firms, it's fairly clear we couldn't get everyone to change their systems to meet the requirements of a central system," he said.
"The whole idea of NECS was to have a system that allows all those systems to talk to each other."
Mr Libbis said five jurisdictions and NECO had signed the agreement with LIXI, and it was understood the ACT was in the process of signing.
"Victoria and Queensland have given us no indication of their plans, so we're working on the basis they don't intend to sign," he said.
"Every other state is strongly supportive as well as the industry, particularly the lending institutions, so we are just getting on with it," he said. "The announcement of our death was a bit exaggerated".
A NECO steering committee meeting will be held in Brisbane on November 23, and the rebel states' alternative position would be discussed then.
The ABA's Mr Gilbert said a national e-conveyancing system required more than just a piece of software: there had to be a governance structure, rules for participation and common data standards to support the process.
"It's recognised the system will need flexibility to accommodate the different state requirements, but there's a core piece that could operate in a fairly standardised way," he said.
"For users, it's important that there should be seamless interoperability across the jurisdictions, with a single point of entry."
Victoria and Queensland were essentially suggesting a return to a state-centric approach, with each jurisdiction using similar software but without the nationwide interoperability.
Mr Gilbert said bankers wanted the NECS steering committee to "bring everybody back to the original focus", and "work collaboratively towards delivering" an e-conveyancing system.
Karen Dearne | October 30, 2007
The Australian IT
Sunday, October 28, 2007
Mr Ruddock, we need a referendum.
What if the States do not resolve their impasse over a uniform national approach to electronic conveyancing?
Will you support a referendum to bring matters of property within Federal jurisdiction, which are currently state controlled matters?
We understand you do support a national approach with quotes such as -
"The same jealousies that resulted in different rail-gauge widths in the 19th century are sabotaging a national electronic conveyancing system in the 21st century," Mr Ruddock said.
"I have been pressing for the states and territories to focus on the need for a national electronic conveyancing system for some time. A national electronic conveyancing system would remove red tape for business and lower costs for home buyers."
It is simple - Australia has eight separate land registries, eight different conveyancing and property laws, eight different scales of land transfer duties, land registry fees and land tax. There is no uniform approach to conveyancing, planning, survey, vendor disclosure and taxation
At least in the UK, England and Wales have a single land registry system, which will support the introduction of uniform single electronic conveyancing standard. This year, 2007, the UK have introduced a uniform standard to vendor disclosure which includes a energy efficiency (think of the climate change debate) and building inspection report. And they will over time roll out electronic conveyancing unimpeded by parochial state or county rules.
Australia would benefit hugely and immeasurably from property laws being centrally and Federally controlled. This country could have
* a single property register
* uniform property codes
* uniform conveyancing laws
* uniform property transfer fees - stamp duty on transfer and land registration
* uniform taxation of land - land tax, CGT, GST, income tax and negative gearing
* uniform vendor disclosure on the sale of property
* uniform laws for estate agents
* uniform survey regulations
* uniform approach to planning with local input
We already have a common unified approach to GST and CGT on property. We also have the Uniform Credit Code. This needs to be extended to all matters pertaining to property.
Only the States stand in the way of a single unified approach to property laws, management and taxation - and the States would never ever support transferring their current rights. By heck they would lose the right to tax it as they see fit.
What is the Federal government's view?
My personal view is let the people cast their vote. Just maybe the people can see the wisdom for change.
Will you support a referendum to bring matters of property within Federal jurisdiction, which are currently state controlled matters?
We understand you do support a national approach with quotes such as -
"The same jealousies that resulted in different rail-gauge widths in the 19th century are sabotaging a national electronic conveyancing system in the 21st century," Mr Ruddock said.
"I have been pressing for the states and territories to focus on the need for a national electronic conveyancing system for some time. A national electronic conveyancing system would remove red tape for business and lower costs for home buyers."
It is simple - Australia has eight separate land registries, eight different conveyancing and property laws, eight different scales of land transfer duties, land registry fees and land tax. There is no uniform approach to conveyancing, planning, survey, vendor disclosure and taxation
At least in the UK, England and Wales have a single land registry system, which will support the introduction of uniform single electronic conveyancing standard. This year, 2007, the UK have introduced a uniform standard to vendor disclosure which includes a energy efficiency (think of the climate change debate) and building inspection report. And they will over time roll out electronic conveyancing unimpeded by parochial state or county rules.
Australia would benefit hugely and immeasurably from property laws being centrally and Federally controlled. This country could have
* a single property register
* uniform property codes
* uniform conveyancing laws
* uniform property transfer fees - stamp duty on transfer and land registration
* uniform taxation of land - land tax, CGT, GST, income tax and negative gearing
* uniform vendor disclosure on the sale of property
* uniform laws for estate agents
* uniform survey regulations
* uniform approach to planning with local input
We already have a common unified approach to GST and CGT on property. We also have the Uniform Credit Code. This needs to be extended to all matters pertaining to property.
Only the States stand in the way of a single unified approach to property laws, management and taxation - and the States would never ever support transferring their current rights. By heck they would lose the right to tax it as they see fit.
What is the Federal government's view?
My personal view is let the people cast their vote. Just maybe the people can see the wisdom for change.
Friday, October 26, 2007
E-conveyancing 'shemozzle' looms
FOR a lawyer who says he is "red-hot for anything digital", Brett Hayton has a bleak prediction for next month's launch of electronic conveyancing in Victoria.
"It will be a shemozzle," he said.
Mr Hayton said there was very little chance of a flood of electronic property deals when the new pilot system went live on November 16. The reason was that the numbers were stacked against the new system.
Mr Hayton's assessment is not based on a distaste for technology. As well as running Hayton Kosky Lawyers in Bentleigh, Victoria, he has spent years developing his own web-based system for handling property transactions.
His experience with that system, known as 247legal.com.au, has informed his assessment of the Victorian Government's plans.
"There are problems with the government system," he said.
"They must be looking at things over generations.
"It's like they have adopted the view 'build it and they will come'."
In order to make electronic conveyancing a reality, he said, each transaction required four key players - two banks and two lawyers.
Non-lawyer conveyancers might take the place of solicitors in some transactions, but that does not affect his argument.
The problem in Victoria, as he sees it, is that the big banks have withdrawn from the system and there is no obligation on solicitors to switch to the electronic system.
"So let's assume that 50 per cent of lawyers sign up for it. That means a maximum of only one in four transactions is going to be electronic.
"Three-quarters of them will still be on paper - and that's the biggest drawback to the system."
Mr Hayton might even have overestimated the take-up rate among solicitors. Two weeks ago, Law Institute of Victoria chief executive Michael Brett Young warned the state's solicitors that the institute "cannot recommend that its members enter the scheme".
He issued that warning after the Legal Practitioners Liability Committee raised concerns about the possible risks to lawyers who took part.
Talks aimed at resolving the committee's concerns are continuing. But a spokeswoman for the institute said yesterday that nothing had changed.
Mr Hayton, however, said safety was not the main issue with the new system. He was more concerned about the possibility that Victoria's switch to electronic conveyancing might be about to result in two separate systems - paper and electronic.
He is also concerned that other states might adopt this part of the Victoria model - complicating conveyancing by allowing two separate systems to operate side by side in every state. "I once raised this issue at a meeting and asked how I was to know whether a particular transaction was going to be electronic or paper. Do I ring around?
"There was no answer.
"I don't want to see a 50-50 system. It needs to be made compulsory to use the new system and that needs to happen sooner rather than later to avoid mucking around with dual systems.
"The banks have a cogent view. They deal nationally. They don't care where a transaction is settled, but they deal with seven systems now and they don't want to deal with 14."
If these concerns are resolved, he believes firms that embrace electronic conveyancing will eventually have a significant cost advantage over their paper-based competitors.
Eventually, that will place them on the winning side of the rationalisation that he believes will flow through the industry.
Chris Merritt | October 26, 2007
The Australian
"It will be a shemozzle," he said.
Mr Hayton said there was very little chance of a flood of electronic property deals when the new pilot system went live on November 16. The reason was that the numbers were stacked against the new system.
Mr Hayton's assessment is not based on a distaste for technology. As well as running Hayton Kosky Lawyers in Bentleigh, Victoria, he has spent years developing his own web-based system for handling property transactions.
His experience with that system, known as 247legal.com.au, has informed his assessment of the Victorian Government's plans.
"There are problems with the government system," he said.
"They must be looking at things over generations.
"It's like they have adopted the view 'build it and they will come'."
In order to make electronic conveyancing a reality, he said, each transaction required four key players - two banks and two lawyers.
Non-lawyer conveyancers might take the place of solicitors in some transactions, but that does not affect his argument.
The problem in Victoria, as he sees it, is that the big banks have withdrawn from the system and there is no obligation on solicitors to switch to the electronic system.
"So let's assume that 50 per cent of lawyers sign up for it. That means a maximum of only one in four transactions is going to be electronic.
"Three-quarters of them will still be on paper - and that's the biggest drawback to the system."
Mr Hayton might even have overestimated the take-up rate among solicitors. Two weeks ago, Law Institute of Victoria chief executive Michael Brett Young warned the state's solicitors that the institute "cannot recommend that its members enter the scheme".
He issued that warning after the Legal Practitioners Liability Committee raised concerns about the possible risks to lawyers who took part.
Talks aimed at resolving the committee's concerns are continuing. But a spokeswoman for the institute said yesterday that nothing had changed.
Mr Hayton, however, said safety was not the main issue with the new system. He was more concerned about the possibility that Victoria's switch to electronic conveyancing might be about to result in two separate systems - paper and electronic.
He is also concerned that other states might adopt this part of the Victoria model - complicating conveyancing by allowing two separate systems to operate side by side in every state. "I once raised this issue at a meeting and asked how I was to know whether a particular transaction was going to be electronic or paper. Do I ring around?
"There was no answer.
"I don't want to see a 50-50 system. It needs to be made compulsory to use the new system and that needs to happen sooner rather than later to avoid mucking around with dual systems.
"The banks have a cogent view. They deal nationally. They don't care where a transaction is settled, but they deal with seven systems now and they don't want to deal with 14."
If these concerns are resolved, he believes firms that embrace electronic conveyancing will eventually have a significant cost advantage over their paper-based competitors.
Eventually, that will place them on the winning side of the rationalisation that he believes will flow through the industry.
Chris Merritt | October 26, 2007
The Australian
Monday, October 22, 2007
What a waste of paper
What is the largest vendors statement that you might have prepared? We have recently completed a job at a suburb called Waterways and the vendors statement was 430 pages.
This is probably not a record, but when the agent wants 6 copies, no-one wants the responsibility to print the document. Lets see now, 6 copies time 430 pages equals 2580.
As an industry is there support for a standard to create and distribute the section 32 electronically (and still satisfy the legal requirementsof the vendor signing / purchaser acknowledging receipt)?
Is anyone prepared to comment?
This is probably not a record, but when the agent wants 6 copies, no-one wants the responsibility to print the document. Lets see now, 6 copies time 430 pages equals 2580.
As an industry is there support for a standard to create and distribute the section 32 electronically (and still satisfy the legal requirementsof the vendor signing / purchaser acknowledging receipt)?
Is anyone prepared to comment?
Sunday, October 21, 2007
Thursday, October 18, 2007
Not related to conveyancing as such
Alex Roy's Cannonball dreams started with a movie, but it didn't star Burt Reynolds. The film was C'était un Rendez-vous. Made in 1976, it's a dashing precursor to every Jackass-inspired digicam stunt ever posted on YouTube — nine heart-pounding minutes choreographed to a screaming drivetrain. Through a bumper-mounted camera, the viewer becomes the car — traveling more than 80 mph as the anonymous driver revs into the enormous traffic circle around Paris' Arc de Triomphe, steers hammer-down from the Champs Élysées to Sacré-Coeur in Montmartre (through 16 red lights, wrong-way one-ways, stunned pedestrians, garbage trucks, and median strips) to meet up with a beautiful blonde waiting patiently in the park at the Montmartre church.
Wednesday, October 17, 2007
EC Heavy weight title fight
There has been plenty of action before the main fight scheduled for November 16.
Victoria, the heavy weight promoter of the electronic conveyancing crown, is in trouble as the competition between the contenders is hotting up and not a punch has been thrown.
The big banks have hung up their gloves and reckon the Victorian competition is for pussies and has joined ranks calling for a national competition.
The lawyers have cried foul and dont want to punch on with the conveyancers in the opposing corner.
Even the master builders have chipped in and I didn't even know they were a contestant.
The punters thinking that the price of admission would be cut found that even though hardly a front row ticket has been sold has just been told the ticket prices have been upped by 30%.
At the moment this all looks to be shaping up to be an all in brawl.
If you missed the October Newsletter here's the proverbial link
Victoria, the heavy weight promoter of the electronic conveyancing crown, is in trouble as the competition between the contenders is hotting up and not a punch has been thrown.
The big banks have hung up their gloves and reckon the Victorian competition is for pussies and has joined ranks calling for a national competition.
The lawyers have cried foul and dont want to punch on with the conveyancers in the opposing corner.
Even the master builders have chipped in and I didn't even know they were a contestant.
The punters thinking that the price of admission would be cut found that even though hardly a front row ticket has been sold has just been told the ticket prices have been upped by 30%.
At the moment this all looks to be shaping up to be an all in brawl.
If you missed the October Newsletter here's the proverbial link
Saturday, October 13, 2007
LTO Fees - paper vs electronic
Is our government ripping off the public? The new frontier of electronic conveyancing is beckoning and we are getting a sneak preview of the proposed fees under the new electronic regime. The government spins the spin that electronic conveyancing will lower the costs of conveyancing. But the facts are now on the table.
The fees on the left are for paper lodgement.
The fees on the right are for electronic lodgement.
There are no monetary savings using electronic, just a financial penalty for the consumer if they continue with paper lodgement. Electonic lodgement fees are the old paper lodgement fees and over the counter charges are 20 to 30% increases which the consumer has to pay. Go figure? It smacks of monopolistic behaviour. Are government dealings regulated by ACCC?
Refer Google Spreadsheet for the fees
Friday, October 12, 2007
E-conveyancing system in trouble
A feud between Victoria's solicitors and non-lawyer conveyancers threatens to undermine the launch of an electronic conveyancing system that could cut $70 million from the cost of home ownership.
Electronic Conveyancing Victoria is due to begin full operations on November 16 but there is a risk that solicitors may boycott the scheme.
Law Institute of Victoria chief executive Michael Brett Young has warned the state's solicitors that without changes the institute "cannot recommend that its members enter the scheme".
Unless the stand-off is resolved, it threatens to undermine the viability of the e-conveyancing system, which could cut the cost of conveyancing transactions by between $235 and $395, the state Government says.
The scheme had already been rocked when major banks withdrew from it last month because of frustration with a lack of co-operation between Victoria and authorities working on a national e-conveyancing project.
If solicitors join the major banks on the sidelines, the Victorian system would be deprived of the two main industry groups that are central players in most conveyancing transactions.
The institute's concerns were triggered by an adverse assessment of the system by the organisation that provides professional indemnity insurance for the state's solicitors.
The institute is also concerned that non-lawyer conveyancers will be using the new system before their new regulatory regime comes into force next year.
The institute says current legislation governing conveyancers does not provide enough insurance cover.
Mr Brett Young says this means solicitors "do not feel confident" about entering into electronic conveyancing transactions with unregulated conveyancers. However, non-lawyer conveyancers say their insurance cover has satisfied the state Government and solicitors are simply trying to dominate the new system.
Although the major banks have withdrawn from the e-conveyancing system, the Government says talks are continuing. Other financial institutions are still involved, including the Australian Securities Exchange, Bendigo Bank and the credit unions.
To justify the investment made by its members in the Victorian project, a national system needs to emerge, the Australian Bankers Association says.
After the big banks withdrew, the Victorian Government made the software underpinning the system available to all other states for assessment.
Queensland's Department of Natural Resources and Water had earlier conducted tests on the Victorian system and, according to Victoria, found that it could be adapted cost-effectively to meet Queensland's needs.
In Victoria, however, the system's launch may be marred if the state's solicitors heed the institute's warning about potential risks in using the new system.
The institute's concerns originated with the Legal Practitioners Liability Committee, a statutory authority that provides professional indemnity insurance for Victoria's solicitors and most national law firms, but they are also linked to the long-standing antipathy between solicitors and non-lawyer conveyancers, who have won government approval to compete for legal work in conveyancing transactions.
In the current issue of the Law Institute Journal, Mr Brett Young writes that the committee "believes there are greater risks for practitioners operating in this system than under the current system".
"Without the committee's endorsement, the institute cannot recommend that its members enter the scheme."
Talks aimed at resolving the committee's concerns are under way, but that organisation's assessment of the new system appears to be at odds with one commissioned by the Victorian Government.
A spokeswoman for Environment Minister Gavin Jennings, whose department is responsible for the system, said there was a low level of risk associated with the new system.
"A risk assessment by a major accounting and consulting firm has been undertaken to determine the level of cover required by participants. This identified that the level of risk was very low," the spokeswoman said.
Mr Brett Young writes in the Law Institute Journal that the 2008 start date for the conveyancers' regulatory system "raises questions about the ability of conveyancers to be involved in the process, particularly in relation to their ongoing insurance requirements".
"The institute believes the current conveyancing legislation does not provide sufficient insurance coverage for solicitors to feel confident entering into e-conveyancing transactions with unregulated conveyancers," he writes.
However, the rules governing the system require all users of the new system to have a set level of insurance cover. A Mallesons Stephen Jaques overview states that the system's users will be required to sign contracts agreeing to comply with the rules.
The Australian Institute of Conveyancers, which represents non-lawyer conveyancers, says the institute's concerns appear to be based on a misapprehension.
Conveyancers institute Victorian chief executive Jill Ludwell says a government working group responsible for e-conveyancing had talked to the group's insurance broker and was satisfied with the insurance cover in policies for its members.
"We showed them our policy, they had a look and said they were satisfied with $1 million in professional indemnity cover and fidelity cover of $50,000," she says. "Electronic Conveyancing Victoria laid down guidelines for indemnity insurance and that is well and truly covered by members of the conveyancers institute. We get on very well with ECV. We have members helping them get the whole thing up and running. We have no problems with ECV and they seem to have no problems with us," she says.
Ms Ludwell says the law institute's warning to solicitors about participating in the system amounts to a threat to conveyancers. "They have it in their minds that electronic conveyancing is going to be legal work."
She rejects Mr Brett Young's assertions that conveyancers have not participated in consultations over the insurance requirement for e-conveyancing. "We have been consulted, and just not in their hearing," Ms Ludwell says.
Mr Brett Young writes in the Law Institute Journal that the law institute supports the system but unless its concerns are addressed, the launch date will be meaningless. He says he would not characterise the committee's view of the new system as an adverse risk assessment.
"They have some concerns over insurance and they want those concerns dealt with," he said. "They are looking to be included in the ongoing review of the system to make sure their concerns are addressed."
One of the committee's main concerns was the possibility that solicitors might be liable under the new system to compensate victims of fraudulent transactions if the fraud had been caused by others, such as conveyancers.
Ms Ludwell says this concern seems baseless because solicitors and conveyancers already work on opposite sides of paper-based conveyancing transactions. "What's the difference?"
Mr Brett Young says the new system posed risks for solicitors that were not present in traditional paper-based conveyancing.
Parties to the new system need to warrant that they have taken reasonable steps to ensure the information provided by another party, such as a conveyancer, is correct, Mr Brett Young says. If the information proves false and the conveyancer has inadequate insurance, there is a risk of liability falling to the solicitor, he says.
Mr Brett Young says he would like to see Victoria's system running as soon as possible. "But it will only work if you get all of the stakeholders on board. These issues can be addressed very quickly and we could then move forward," he says.
Mr Jennings' spokeswoman says the new system will not alter the substance of conveyancing transactions.
The Government has been working with the law institute for more than two and a half years on the e-conveyancing project. Within two weeks, the law institute is due to report on its assessment of the legal framework for the system. The Government will then hold discussions with law institute representatives.
Chris Merritt | October 12, 2007
Business Australian
Electronic Conveyancing Victoria is due to begin full operations on November 16 but there is a risk that solicitors may boycott the scheme.
Law Institute of Victoria chief executive Michael Brett Young has warned the state's solicitors that without changes the institute "cannot recommend that its members enter the scheme".
Unless the stand-off is resolved, it threatens to undermine the viability of the e-conveyancing system, which could cut the cost of conveyancing transactions by between $235 and $395, the state Government says.
The scheme had already been rocked when major banks withdrew from it last month because of frustration with a lack of co-operation between Victoria and authorities working on a national e-conveyancing project.
If solicitors join the major banks on the sidelines, the Victorian system would be deprived of the two main industry groups that are central players in most conveyancing transactions.
The institute's concerns were triggered by an adverse assessment of the system by the organisation that provides professional indemnity insurance for the state's solicitors.
The institute is also concerned that non-lawyer conveyancers will be using the new system before their new regulatory regime comes into force next year.
The institute says current legislation governing conveyancers does not provide enough insurance cover.
Mr Brett Young says this means solicitors "do not feel confident" about entering into electronic conveyancing transactions with unregulated conveyancers. However, non-lawyer conveyancers say their insurance cover has satisfied the state Government and solicitors are simply trying to dominate the new system.
Although the major banks have withdrawn from the e-conveyancing system, the Government says talks are continuing. Other financial institutions are still involved, including the Australian Securities Exchange, Bendigo Bank and the credit unions.
To justify the investment made by its members in the Victorian project, a national system needs to emerge, the Australian Bankers Association says.
After the big banks withdrew, the Victorian Government made the software underpinning the system available to all other states for assessment.
Queensland's Department of Natural Resources and Water had earlier conducted tests on the Victorian system and, according to Victoria, found that it could be adapted cost-effectively to meet Queensland's needs.
In Victoria, however, the system's launch may be marred if the state's solicitors heed the institute's warning about potential risks in using the new system.
The institute's concerns originated with the Legal Practitioners Liability Committee, a statutory authority that provides professional indemnity insurance for Victoria's solicitors and most national law firms, but they are also linked to the long-standing antipathy between solicitors and non-lawyer conveyancers, who have won government approval to compete for legal work in conveyancing transactions.
In the current issue of the Law Institute Journal, Mr Brett Young writes that the committee "believes there are greater risks for practitioners operating in this system than under the current system".
"Without the committee's endorsement, the institute cannot recommend that its members enter the scheme."
Talks aimed at resolving the committee's concerns are under way, but that organisation's assessment of the new system appears to be at odds with one commissioned by the Victorian Government.
A spokeswoman for Environment Minister Gavin Jennings, whose department is responsible for the system, said there was a low level of risk associated with the new system.
"A risk assessment by a major accounting and consulting firm has been undertaken to determine the level of cover required by participants. This identified that the level of risk was very low," the spokeswoman said.
Mr Brett Young writes in the Law Institute Journal that the 2008 start date for the conveyancers' regulatory system "raises questions about the ability of conveyancers to be involved in the process, particularly in relation to their ongoing insurance requirements".
"The institute believes the current conveyancing legislation does not provide sufficient insurance coverage for solicitors to feel confident entering into e-conveyancing transactions with unregulated conveyancers," he writes.
However, the rules governing the system require all users of the new system to have a set level of insurance cover. A Mallesons Stephen Jaques overview states that the system's users will be required to sign contracts agreeing to comply with the rules.
The Australian Institute of Conveyancers, which represents non-lawyer conveyancers, says the institute's concerns appear to be based on a misapprehension.
Conveyancers institute Victorian chief executive Jill Ludwell says a government working group responsible for e-conveyancing had talked to the group's insurance broker and was satisfied with the insurance cover in policies for its members.
"We showed them our policy, they had a look and said they were satisfied with $1 million in professional indemnity cover and fidelity cover of $50,000," she says. "Electronic Conveyancing Victoria laid down guidelines for indemnity insurance and that is well and truly covered by members of the conveyancers institute. We get on very well with ECV. We have members helping them get the whole thing up and running. We have no problems with ECV and they seem to have no problems with us," she says.
Ms Ludwell says the law institute's warning to solicitors about participating in the system amounts to a threat to conveyancers. "They have it in their minds that electronic conveyancing is going to be legal work."
She rejects Mr Brett Young's assertions that conveyancers have not participated in consultations over the insurance requirement for e-conveyancing. "We have been consulted, and just not in their hearing," Ms Ludwell says.
Mr Brett Young writes in the Law Institute Journal that the law institute supports the system but unless its concerns are addressed, the launch date will be meaningless. He says he would not characterise the committee's view of the new system as an adverse risk assessment.
"They have some concerns over insurance and they want those concerns dealt with," he said. "They are looking to be included in the ongoing review of the system to make sure their concerns are addressed."
One of the committee's main concerns was the possibility that solicitors might be liable under the new system to compensate victims of fraudulent transactions if the fraud had been caused by others, such as conveyancers.
Ms Ludwell says this concern seems baseless because solicitors and conveyancers already work on opposite sides of paper-based conveyancing transactions. "What's the difference?"
Mr Brett Young says the new system posed risks for solicitors that were not present in traditional paper-based conveyancing.
Parties to the new system need to warrant that they have taken reasonable steps to ensure the information provided by another party, such as a conveyancer, is correct, Mr Brett Young says. If the information proves false and the conveyancer has inadequate insurance, there is a risk of liability falling to the solicitor, he says.
Mr Brett Young says he would like to see Victoria's system running as soon as possible. "But it will only work if you get all of the stakeholders on board. These issues can be addressed very quickly and we could then move forward," he says.
Mr Jennings' spokeswoman says the new system will not alter the substance of conveyancing transactions.
The Government has been working with the law institute for more than two and a half years on the e-conveyancing project. Within two weeks, the law institute is due to report on its assessment of the legal framework for the system. The Government will then hold discussions with law institute representatives.
Chris Merritt | October 12, 2007
Business Australian
Boycott by Lawyers?
THE bad blood between Victoria's lawyers and the state's conveyancers has just about gone far enough.
At the very least, this antipathy appears to be one of the factors behind the possible boycott by solicitors of Victoria's new system of electronic conveyancing.
That system, the first in the nation, is expected to lead to significant cost savings for everyone who buys and sells property. It deserves to be supported by lawyers.
If solicitors withdraw from the new system, it will have two possible consequences.
In the short term, it will hurt consumers of legal services. Those who choose to leave their conveyancing work with solicitors will be forced to use traditional paper-based conveyancing. And thanks to the Victorian Government, the cost of that traditional service is about to rise.
In the long-term, a boycott will almost certainly backfire.
When South Australia invented the system of Torrens title, that state's solicitors reacted in much the same way and boycotted the new-fangled system.
They favoured the old-system form of title that, when viewed objectively, is nothing but a make-work scheme for the legally trained.
That left a lucrative gap in the market. The result: South Australia is now one of the greatest strong-holds for non-lawyer conveyancers.
If Victoria's solicitors want to achieve the same outcome, they should go right ahead. The conveyancers will steal their lunch.
Chris Merritt | October 12, 2007
Business Australian
I agree with Chris' conclusion, and the comment about lawyers antipathy, but the quotation about a possible lawyer's boycott is not supported by any direct quotation.
At the very least, this antipathy appears to be one of the factors behind the possible boycott by solicitors of Victoria's new system of electronic conveyancing.
That system, the first in the nation, is expected to lead to significant cost savings for everyone who buys and sells property. It deserves to be supported by lawyers.
If solicitors withdraw from the new system, it will have two possible consequences.
In the short term, it will hurt consumers of legal services. Those who choose to leave their conveyancing work with solicitors will be forced to use traditional paper-based conveyancing. And thanks to the Victorian Government, the cost of that traditional service is about to rise.
In the long-term, a boycott will almost certainly backfire.
When South Australia invented the system of Torrens title, that state's solicitors reacted in much the same way and boycotted the new-fangled system.
They favoured the old-system form of title that, when viewed objectively, is nothing but a make-work scheme for the legally trained.
That left a lucrative gap in the market. The result: South Australia is now one of the greatest strong-holds for non-lawyer conveyancers.
If Victoria's solicitors want to achieve the same outcome, they should go right ahead. The conveyancers will steal their lunch.
Chris Merritt | October 12, 2007
Business Australian
I agree with Chris' conclusion, and the comment about lawyers antipathy, but the quotation about a possible lawyer's boycott is not supported by any direct quotation.
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
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
Thursday, October 11, 2007
Agents Selling Authorities
You are selling and have chosen an agent. The Agent has prepared the Agents Selling Authority, usually exclusive for 90 days. But what if you are not happy with the level of service? You are locked in. Have you read the fine print. Probably not.
A suggestion made by estate agent Terry Ryder of McGrath Partners suggests that you consider putting a termination clause in the agency agreement. "It should give you the right to sack your agent if you're not happy with their level of service. Because in standard agreements, you're kind of locked in. A prudent seller would insist on writing in a clause which gives you the right to terminate without incurring any financial penalty."
Take Action
If you aren't happy with the treatment you've received as a buyer or vendor, you can make a complaint to the Real Estate Institute in your State or Territory. You could also contact the Department of Fair Trading, or equivalent in your State.
If you've been left out of pocket, and it was the agent's fault, seek legal advice in relation to your rights.
Top 10 questions to ask agents
1.How long have you been working in this area?
2.What comparable homes have you sold in this area lately?
3.What is the state of the market?
4.How long is it taking you to sell well-priced listings at the moment?
5.How much is my home worth? How have you come up with that figure?
6.Should I sell by auction or private treaty? Why?
7.What marketing strategy do you suggest? Why?
8.What will you do to introduce buyers to my property?
9.How does my house present? What should I do to maximise the sale price?
10.Do you have a list of recent vendors I can speak to?
Source Metropole Property Newsletter
A suggestion made by estate agent Terry Ryder of McGrath Partners suggests that you consider putting a termination clause in the agency agreement. "It should give you the right to sack your agent if you're not happy with their level of service. Because in standard agreements, you're kind of locked in. A prudent seller would insist on writing in a clause which gives you the right to terminate without incurring any financial penalty."
Take Action
If you aren't happy with the treatment you've received as a buyer or vendor, you can make a complaint to the Real Estate Institute in your State or Territory. You could also contact the Department of Fair Trading, or equivalent in your State.
If you've been left out of pocket, and it was the agent's fault, seek legal advice in relation to your rights.
Top 10 questions to ask agents
1.How long have you been working in this area?
2.What comparable homes have you sold in this area lately?
3.What is the state of the market?
4.How long is it taking you to sell well-priced listings at the moment?
5.How much is my home worth? How have you come up with that figure?
6.Should I sell by auction or private treaty? Why?
7.What marketing strategy do you suggest? Why?
8.What will you do to introduce buyers to my property?
9.How does my house present? What should I do to maximise the sale price?
10.Do you have a list of recent vendors I can speak to?
Source Metropole Property Newsletter
Monday, October 01, 2007
Master Builders Association response to EC
VICTORIA will be the first Australian state to enter the brave new world of "electronic conveyancing", but not everyone is happy with the proposed online system for exchanging mortgage documents.
The Master Builders Association says the State Government is using the new system to increase conveyancing fees. This would further reduce housing affordability, as its building and construction members would pass the added costs to consumers.
According to an MBA submission, land transfer fees would remain the same for electronic conveyancing, but would rise by between 16 and 32 per cent for those who stick with paper.
MBA executive director Brian Welch said the Land Victoria increase was yet another weight on housing affordability.
"Those who stick with the paper trail system are going to be penalised," he said.
"We support the initiative … but it discriminates heavily against people who are not computer-based; who are not literate with these systems.
"The State Government finds taxation all too easy to increase and it impacts on housing once again."
Source The Age Natalie Craig 1 Oct 07
You would have thought a positive step was to reduce transfer fees on electronic conveyancing transactions. It sends a positive signal to promote uptake and second the productivity savings are built into the cost of the transaction. Anyhow transfer fees bear no relation to the cost of the transaction, as the MBA point out the transfer fee is a tax. The MBA response is also consistent with the view the government wants to see a return on their investment in EC. The government can charge whatever they like as they hold the monopoly. BH
The Master Builders Association says the State Government is using the new system to increase conveyancing fees. This would further reduce housing affordability, as its building and construction members would pass the added costs to consumers.
According to an MBA submission, land transfer fees would remain the same for electronic conveyancing, but would rise by between 16 and 32 per cent for those who stick with paper.
MBA executive director Brian Welch said the Land Victoria increase was yet another weight on housing affordability.
"Those who stick with the paper trail system are going to be penalised," he said.
"We support the initiative … but it discriminates heavily against people who are not computer-based; who are not literate with these systems.
"The State Government finds taxation all too easy to increase and it impacts on housing once again."
Source The Age Natalie Craig 1 Oct 07
You would have thought a positive step was to reduce transfer fees on electronic conveyancing transactions. It sends a positive signal to promote uptake and second the productivity savings are built into the cost of the transaction. Anyhow transfer fees bear no relation to the cost of the transaction, as the MBA point out the transfer fee is a tax. The MBA response is also consistent with the view the government wants to see a return on their investment in EC. The government can charge whatever they like as they hold the monopoly. BH
Tuesday, September 04, 2007
Attorney-General Philip Ruddock
Attorney-General Philip Ruddock today expressed disappointment in the failure of the states and territories to cooperate in efforts to create a national electronic conveyancing system.
"The same jealousies that resulted in different rail-gauge widths in the 19th century are sabotaging a national electronic conveyancing system in the 21st century," Mr Ruddock said.
"I have been pressing for the states and territories to focus on the need for a national electronic conveyancing system for some time. A national electronic conveyancing system would remove red tape for business and lower costs for home buyers."
The Victorian Government has developed a pilot electronic conveyancing system.
"It is now being reported that Victoria has not yet shared its system with the other states to see if it can be used nationally," Mr Ruddock said.
"As a result, the private sector has lost confidence in the ability of the states and territories to deliver a national system."
"I am extremely disappointed that the failure of states and territories to cooperate has undermined such an important project."
The Australian Government has monitored the development of NECS through the Standing Committee of Attorneys-General (SCAG).
"While I recognise that NECS involves a range of ministers, I am disappointed that the Victorian Attorney-General has been unable to provide leadership on such an important national issue."
"I call on the states and territories to work together in the national interest and make a national electronic conveyancing system a reality."
This is a media release issued by AG Phil Ruddock 3/9/07
"The same jealousies that resulted in different rail-gauge widths in the 19th century are sabotaging a national electronic conveyancing system in the 21st century," Mr Ruddock said.
"I have been pressing for the states and territories to focus on the need for a national electronic conveyancing system for some time. A national electronic conveyancing system would remove red tape for business and lower costs for home buyers."
The Victorian Government has developed a pilot electronic conveyancing system.
"It is now being reported that Victoria has not yet shared its system with the other states to see if it can be used nationally," Mr Ruddock said.
"As a result, the private sector has lost confidence in the ability of the states and territories to deliver a national system."
"I am extremely disappointed that the failure of states and territories to cooperate has undermined such an important project."
The Australian Government has monitored the development of NECS through the Standing Committee of Attorneys-General (SCAG).
"While I recognise that NECS involves a range of ministers, I am disappointed that the Victorian Attorney-General has been unable to provide leadership on such an important national issue."
"I call on the states and territories to work together in the national interest and make a national electronic conveyancing system a reality."
This is a media release issued by AG Phil Ruddock 3/9/07
Monday, September 03, 2007
Banks drop conveyancing pilot
The AFR reports the major banks had walked out of Victoria's electronic conveyancing system, known as ECV, which was to begin operating in November.
Without the bank's support there is no ECV.
The banks have invested heavily in ECV on the condition that it would be used as a model for the national system. The report continues the banks have become increasingly frustrated by a lack of dialogue between Victoria and the other states. They withdrew because Victoria has still to make its software available to the national body NECO.
In a letter to NECO, the Australian Bankers Association called for a national project team to be set up to improve co-operation. "Only through a national project ... can banks and other stakeholders approach a NECO project with confidence that there is one project, one process and one national outcome. Without this the banks will not be able to recommit to work on a project that lacks any certainty of a national roll-out or application"
Bendigo Bank is one of the few entities still in talks with the Victorian Government about the state's electronic conveyancing system (ECV).
Extracts from Australian Financial Review Matthew Drummond 3/9/07
copy articles
Without the bank's support there is no ECV.
The banks have invested heavily in ECV on the condition that it would be used as a model for the national system. The report continues the banks have become increasingly frustrated by a lack of dialogue between Victoria and the other states. They withdrew because Victoria has still to make its software available to the national body NECO.
In a letter to NECO, the Australian Bankers Association called for a national project team to be set up to improve co-operation. "Only through a national project ... can banks and other stakeholders approach a NECO project with confidence that there is one project, one process and one national outcome. Without this the banks will not be able to recommit to work on a project that lacks any certainty of a national roll-out or application"
Bendigo Bank is one of the few entities still in talks with the Victorian Government about the state's electronic conveyancing system (ECV).
Extracts from Australian Financial Review Matthew Drummond 3/9/07
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