Electronic conveyancing (or e-conveyancing) refers to a conveyancing transaction (which can be either a sale or a purchase of land) where your lawyer or licensed conveyancer has chosen to settle your transaction electronically.
The system is not compulsory which means that the current paper method of conveyancing will continue to operate alongside the new electronic system. In fact, electronic conveyancing does not cover each step in a conveyancing transaction; it only comes in at the point of preparation of the Transfer.
As such, all the steps prior to the Transfer such as preparation of the Contract, exchange of Contract and Requisitions on Title all continue to be paper-based.
PEXA is Australia’s electronic conveyancing system. PEXA is both the company providing the electronic platform and the electronic platform system itself.
The State Governments of Victoria, New South Wales, Queensland and Western Australia together with the major banks (ANZ, Commonwealth, National Australia Bank, Westpac and Macquarie Capital) are the principal shareholders of the company Property Exchange Australia Limited (“PEXA” for short).
Any lawyer or licensed conveyancer wishing to join the electronic conveyancing system must firstly register with PEXA. The transactions then take place electronically on the PEXA platform. Land registries of each participating State have been incorporated on the PEXA platform by effect of the ECNL.
The first step for the lawyer or licensed conveyancer who has opted for e-Conveyancing is to enter into a Client Authorisation with you.
As there is no such document under paper conveyancing, you will thereby be immediately alerted that your practitioner has switched to electronic conveyancing when you are asked to enter into a Client Authorisation (CA).
The Client Authorisation form (or CA form) is mandated by the legislation. It follows that a practitioner cannot opt out of using this form which is signed by you and the practitioner. This two-page form is very important and you should read it carefully before signing it. Through the CA form you authorise your lawyer or licensed conveyancer to do the following for you:
The conveyancing transaction types are as follows:
By signing the CA form you are also certifying:
The second step for the lawyer or licensed conveyancer who has opted for e-Conveyancing is to verify your identity which must be done at the time of entering into a Client Authorisation with you.
This Verification of Identity (or VOI) process is more complex than the current identification that is required for stamp duty purposes when purchasing property, and your lawyer or licensed conveyancer will guide you in regard to meeting these VOI requirements.
You should be aware of the following:
Documents such as the Transfer and the financial settlement statement are digitally signed using a digital certificate. This is a USB device which has been encrypted with electronic data intended for the exclusive use of a particular person within the firm. You will still need to sign the Contract for Sale in readiness for exchange but beyond that point, after you have entered into a CA, your lawyer or licensed conveyancer will digitally sign all other documents for you including the Transfer.
Under the electronic conveyancing system, the practitioner has the authority to digitally sign the Transfer for a vendor provided that the CA has been signed by both the vendor and the practitioner.
Where you are purchasing property, and your lawyer or licensed conveyancer has joined e-conveyancing, you will no longer be able to provide additional funds for settlement by providing bank cheques for settlement to your practitioner.
All funds for settlement must be provided electronically through the electronic workspace in PEXA. Accordingly, your practitioner will request you to deposit your funds for settlement to a source account (in most cases this will be your practitioner’s firm’s trust account) three days prior to settlement.
This is because settlement can only occur on cleared funds (banks take three business days to clear funds). It follows that where you are selling property, your funds will be immediately available after electronic settlement.
Comasters continues to perform paper-based conveyancing and has joined PEXA for electronic conveyancing transactions. As such, Comasters is able to assist you with any of your conveyancing transactions including where the practitioner on the other side of the transaction has chosen electronic conveyancing for the transaction.
© Comasters November 2015
Important: This is not advice. Clients should not act solely on the basis of the material contained in this paper. Our formal advice should be sought before acting on any aspect of the above information.