Settlement industry bulletin Issue 48 - E-conveyancing is coming to Western Australia (April 2015)

Information status

All documents issued prior to 1 July 2017 were issued by the former Department of Commerce. Documents listed here are the latest versions available, but may be subject to review. For more information on this document, please contact online@dmirs.wa.gov.au.

This publication is for: 
Property industry

E-conveyancing is coming to Western Australia

E-conveyancing - background

The Council of Australian Governments agreed to deliver a National Electronic Conveyancing System (NECS) to the Australian property industry. Electronic conveyancing (e-conveyancing) will enable the electronic settlement of real property transactions; the preparation and electronic lodgement of land registry documents; electronic payment of transfer duty and the exchange of funds automatically at the date and time of settlement.

The Electronic Conveyancing National Law (the National Law) makes the NECS possible in Australia. The Electronic Conveyancing Act 2014 (the EC Act) was introduced in order to enact legislation corresponding to the National Law in Western Australia.

In Western Australia, the Commissioner of Titles, the Registrar and Landgate have statutory functions and duties relating to the Torrens land title register. The EC Act modified some provisions of the National Law to reflect these statutory functions and duties. The EC Act also amended the Transfer of Land Act 1893, the Settlement Agents Act 1981 (the SA Act), the Duties Act 2008 and the Taxation Administration Act 2003.

The first NECS has been established by Property Exchange Australia Ltd (PEXA). Other operators may enter the market in the future but currently PEXA is the only provider of an e-conveyancing system.

PEXA is a private company with shareholders that include:

  • the Victorian, New South Wales, Queensland and Western Australian Governments;
  • the four major banks;
  • Macquarie Capital;
  • Little Group; and
  • Link Group.

PEXA’s broader e-conveyancing functionality has been available in New South Wales and Victoria since 2014. In Western Australia, major banks have been able to lodge mortgage and discharge of mortgage documentation via PEXA since June 2014; however, the electronic settlement of property has not yet been possible.

PEXA’s broader e-conveyancing functionality is due to go live in Western Australia on 25 May 2015. This will allow settlement agents, legal practitioners and financial institutions to lodge mortgages, discharge of mortgages, transfers, caveats and withdrawal of caveats electronically in Western Australia.

The PEXA system is only open to settlement agents/conveyancers and lawyers registered with PEXA. It is not available to individuals seeking to complete their own conveyance.

This latest release of e-conveyancing is focused on normal residential property sales. This means that documents or transactions that require evidence to be lodged with Landgate are out of scope. The only exceptions to this are purchasers’ caveats and circumstances where a transferor has changed their name since becoming the registered proprietor on the title. Use of the new electronic platform is not compulsory as the paper lodgement system still exists.

You can find out more information about PEXA by visiting their website at www.pexa.com.au

Settlement Agents and PEXA fees

There are a range of fees to be paid for utilisation of PEXA’s system. The Department considers that settlement agents may pass onto their clients as disbursements any fees for searches and enquiries made at government offices, statutory authorities and local governments of the type listed in Schedule 2, clause 1(1) of the SA Act. The same applies to the payment of transfer duty.

One of the PEXA fees is a Title Activity Check (TAC), which ensures clear title prior to lodgement. As the cost of a check search of the title is currently an acceptable disbursement, and the TAC is designed to replicate the same search electronically, a TAC fee would be considered an acceptable disbursement.

The Department also considers that settlement agents may pass onto their clients any out-of-pocket expenses that have been incurred for the settlement transaction in question (e.g., courier fees), provided that this is done on a cost-recovery basis only. Where the PEXA
fee schedule applies ‘a per transaction’ fee based on a specific transaction or lodgement this fee would also be considered a cost disbursed on behalf of a client, and thus an acceptable disbursement.

The Department considers that settlement agents may not pass on general administrative overheads that are not directly relevant to the transaction (e.g., a proportion of professional indemnity insurance). Costs from PEXA’s “sponsors” or for administrative functions within the PEXA system that are not directly incurred as a result of a specific transaction would fall within this category of overhead.

In any event, settlement agents should always make clear to their clients the exact basis on which they are being charged and obtain their informed agreement to all costs and disbursements involved in a transaction.

E-conveyancing – Landgate’s role 

Landgate is responsible for the legal framework that enables the operation of an electronic lodgement network – such as that being provided by PEXA - including the Model Participation Rules (MPR) to which subscribers must adhere. Landgate, together with other key government and industry bodies, is working to ensure that current and future subscribers to the PEXA system have an accurate and complete picture of how e-conveyancing will operate in Western Australia and how it may impact their business.

The full effects of the implementation of e-conveyancing will not be known for some time. Landgate believes that there is great opportunity in this change to an electronic environment, but appreciates that settlement agents and lawyers will need time to become familiar with the legal framework and the system.

Landgate recommends you visit the following links for further information:

Landgate is available to assist with the change to e-conveyancing. Should you require further information from Landgate on e-conveyancing or simply wish to meet with a Landgate representative, please email your enquiry to NECSenquiries@landgate.wa.gov.au

Office of State Revenue - Revenue Online Requirements for e-conveyancing

Please note that PEXA must be used in conjunction with the Office of State Revenue’s Revenue Online facility in order to access the full functionality. The Office of State Revenue WA strongly recommends all Western Australian lawyers and settlement agents register for Revenue Online (Online Duties) prior to May 2015 if they are not yet registered. To register, simply go to https://rol.osr.wa.gov.au/Rolng/faces/Home

E-conveyancing amendment to Joint Form of General Conditions for the Sale of Land 

The Law Society of Western Australia and the Real Estate Institute of Western Australia have prepared an Annexure to the Joint Form of General Conditions for the Sale of Land, Electronic Conveyancing Annexure (Special Condition 1), for use in transactions where the parties agree that settlement and lodgement will be conducted electronically in accordance with the National Law.

The Electronic Conveyancing Annexure is available on the Law Society’s website and included with copies of the Joint Form of General Conditions for the Sale of Land sold by the Law Society of Western Australia.

More information about e-conveyancing for settlement agents and lawyers 

In addition to the Landgate and PEXA websites referred to earlier, further information on e-conveyancing is available from the following resources.

Members of the Australian Institute of Conveyancers WA (AICWA) can find more information about e-conveyancing directly from the AICWA or by visiting its website at www.aicwa.com.au 

Similarly, members of the Law Society of Western Australia can find more information about e-conveyancing from the Law Society or by visiting its website at www.lawsocietywa.asn.au.

The Law Society also has an online e-conveyancing learning course for conveyancers and settlement agents available for purchase by non-members, which can be located at http://elearning.lawsocietywa.asn.au/online-courses/econveyancing-conveyancers-andsettlement-agents

Further information, including information about Model Operating Requirements and Model Participation Rules, can be found at the Australian Registrars’ National Electronic Conveyancing Council’s website at www.arnecc.gov.au

Consumer Protection
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Last updated 24 Apr 2015

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