Update on eConveyancing – the end of paper certificates of title in NSW
“There is nothing permanent except change.”
No more paper certificates of title
The Office of the Registrar General has announced a major milestone in the transition away from paper-based property transactions in NSW. The changes were implemented under the Real Property Amendment (Certificates of Title) Act 2021 (NSW).
From 11 October 2021 (the Cessation Date):
paper certificates of title (CTs) will be abolished;
an Information Notice will be introduced. This new document will contain the same information that a person would ordinarily receive had they been issued with a certificate of title; and
all land dealings will be lodged electronically (so completing the move to a largely completed eConveyancing system). While there will be a very small number of limited exceptions, the new system will be generally referred to as ‘100% eConveyancing’.
The move away from paper CTs started in September 2018, with the bulk conversion of CTs where a financial institution was the first mortgagee. In practice, this meant for example where we acted for a purchaser on a property purchase:
if there was an incoming mortgagee, then NSW Land Registry Services would not issue a paper CT; and
if the purchaser was a cash buyer (so no incoming mortgagee), then NSW LRS would still print and issue a paper CT.
The upcoming Cessation Date will complete the abolition of paper CTs.
The stated goal of the NSW Government is for the State to transition to an entirely electronic system for conveyancing. It is worth quoting part of the concluding remarks from the Minister’s Second Reading Speech in the NSW Parliament Legislative Assembly:
In fact, my staff and the team at the Department of Customer Service have been on this [e-conveyancing] journey for many years. I am quite proud to be here to see the last nail in the paper coffin when it comes to eConveyancing. In many ways this forms a great part of the e‑property network. Whether it is ePlanning, e‑construction, the strata hub, eConveyancing or digital twins, in New South Wales we are truly creating a place for e‑property to be a world leader. In fact, we are already a world leader. But by the time this rolls out within two years, we will truly be the dominant force in e‑property around the world, and a place to come and see how it plays out.
The Real Property Amendment (Certificates of Title) Bill 2021 will ensure that the land title system will be governed by contemporary laws which are flexible and balanced. It retires redundant paper processes and embraces a digital future which is faster, more efficient and more reliable—and amen to that. An efficient and secure land title system generates greater returns for the property and financial sector, which supports the New South Wales economy. The benefits will flow on to the people of this great State, with the confidence that New South Wales continues to have a world‑class land title system…
How will the changes impact our clients?
Certificate of Title
From 11 October 2021 NSW LRS will not issue new paper CTs to landowners. After the date, an ‘Information Notice’ will be issued by NSW LRS to confirm the dealings registered and the date of registration. As is the case now, the only way to accurately determine the up to date registration details of a parcel of land will be to purchase a title search of the Register. As such, an Information Notice is not a definitive statement regarding the Register.
As at the Cessation Date, a CT will cease to be a legal document. Clients who have someone else holding or storing their CT may wish to request the CT be returned.
Clients who are holding a CT do not have to do anything before or after the date, but are recommended to hold onto the CT. In some limited instances the CT may be required to satisfy requisitions or other administrative notices that were issued prior to the Cessation Date. Others may simply wish to retain the CT, as an historical memento.
We will seek our clients’ instructions in respect of CTs in our safekeeping, as to whether to:
return the respective CT to our client;
do nothing; or
destroy the respective CT.
In this regard, the Office of the Registrar General has suggested that the options for legal practitioners holding CTs are as follows:
Currently, representative subscribers would be storing thousands of CTs in safe keeping on behalf of their clients. When CTs are cancelled, some firms may wish to seek instructions from their clients on what to do with their CT. Others may want to just return CTs to their clients. Others may want to take the ‘do nothing’ approach, or even destroy them. All are viable options a firm should consider.
If a firm is considering destroying a CT it is recommended that instructions are sought from the client in the first instance. Despite the CT no longer being a legal document, it is still the client’s personal property and should be treated as such. It is not necessary for representative subscribers to stamp a CT as “cancelled” or mark it in any way if returning it to their client after 11 October 2021.
100% eConveyancing - leases
Lease annexures (lease terms and conditions) will continue to be prepared and signed in the usual manner. However, instead of lodging the lease in a paper format with NSW LRS, the signed lease terms and conditions will be scanned and attached to the electronic lease form in the Electronic Lodgement Network Operator workspace (ELNO) and lodged electronically in the ELNO. Douglas Legal is a law firm that is duly registered with PEXA (being Property Exchange Australia Ltd, a large ELNO that is approved to operate in NSW, Victoria, Queensland, Western Australia and South Australia).
Post the Cessation Date, when we act for a landlord in a leasing matter, once we receive the signed lease terms and conditions, we will upload a pdf scan of this document as the “Conditions and Provisions” in the PEXA workspace. We will then attach it to the electronic lease form and the whole document is then electronically signed and lodged for registration on title by NSW LRS.
In recent years, in the context of conveyancing, we have found eConveyancing to be faster and more efficient, for the benefit of all stakeholders.
Douglas Legal welcomes the upcoming further changes to property law.