With the advent of e-commerce, concepts for re-engineering the conveyancing process in England and Wales have been developing for a number of years now, with the Land registry at the forefront. In 1998, preliminary proposals were set out in the joint report by the Law Commission and Land Registry entitled “Land Registration for the Twenty-First Century” . Since then, a series of consultations with key players in the conveyancing process has led to the continued evolution e-conveyancing.
Conveyancing in England and Wales has developed over centuries. When comparing this model with other countries, its substantial strengths becomes apparent but then so it’s weaknesses. The e-conveyancing programme as visualised by the Land Registry aims to maintain the pros and address the cons of the existing conveyancing process.
The major strengths of the conveyancing system in England and Wales are:
- the comfort of certainty and security provided by Land Registration ( with state backed guarantee ), including the Land Registry Official Search system, that provides protection against competing applications; and
- the practice of pre-contract conveyancing searches, which can highlight issues at an early stage and help to avoid unforeseen problems later in the conveyancing process;
- the established tradition of chains of conveyancing transactions with simultaneous conveyancing completions, which helps to avoid the risks and costs inherent when purchases and dependent conveyancing transactions are not simultaneous;
- its well established protocols and procedures, which are widely accepted and used;
- its relative cheapness when compared with most overseas conveyancing systems.
The main flaws in the current conveyancing system, which the advent of e-conveyancing aims to address, are:
- The length of time between “sale agreed” (when an offer is informally accepted) and
- completion of the conveyancing transaction (when the new home owner receives the keys). Currently the conveyancing time scale is an average of 13 weeks (although this may speed up with the introduction of Home Information Packs);
- The lack of transparency and attendant problems in the chain in terms of delay and uncertainty;
- The uneconomic and awkward financial settlements at exchange of contracts and at completion of the conveyancing transaction;
- The potential for poor conveyancing standards to be adopted – with the present paper-based systems, around 50% of all applications lodged with Land Registry by conveyancing solicitors or property lawyer s prove to be defective, and around a third are not properly protected by an Official Search. The present system is also vulnerable to certain types of fraud, particularly impersonation;
- The time gap between completion of the conveyancing transaction ( i.e. keys handed over to the buyer ) and registration – since title does not pass until registration, any bankruptcy of the seller or any other competing interests identified during this time-gap can result in a significant loss for the buyer ( this is a high area of negligence claims for some conveyancing lawyers).
As stated above e- business and the internet are transforming economies and societies across the world. The conveyancing sector of England and Wales, like countless areas of economic activity elsewhere, is involved in the on-going process of change and is already taking advantage of opportunities flowing from these changes. The spread of information technology into homes and offices is affecting the way all key players in the conveyancing process communicate with each other and the ways in which they process and store data. E-mail is now the preferred medium for many conveyancing firms. Lenders, conveyancing solicitors and government departments alike are already taking advantage of the cost saving benefits arising from electronic storage as opposed to traditional paper based record keeping. In light of this backdrop e-conveyancing seems to be the way forward.
In many senses e-conveyancing is already with us. The above provides the backdrop from which the e-conveyancing programme has arisen and from which it can continue to develop, on an incremental basis, until the e-conveyancing vision is fully realised.
Home Owners (Buyers and Sellers)
Buyers and Sellers are generally are becoming more familiar with web communications technology and are increasingly choosing to carry out their business online. The Land Registration Act maintains DIY conveyancing as a possibility and the e-conveyancing system will therefore accommodate their requirements.
Lenders are increasingly marketing and communicating with their customers, conducting their valuations and providing their mortgage offers online. Lenders conveyancing requirements are now communicated via the CML Lenders Handbook which is only available on line ( please see www.cml.org.uk )Estate Agents and Property Portal.
It is now more commonplace for estate agents to use web technology to market properties for sale, including property portals and on-line auctions and sales by tender.
Suppliers to the Conveyancing Industry
Property Search Services and Home Information Pack Providers
The National Land Information Service (NLIS) and others are delivering and developing electronic search services. NLIS is intended, ultimately, to provide a ‘one stop electronic shop’ for conveyancing solicitors, property lawyer s and Home Information Pack providers to obtain land and property data, using licensed channel providers. These services also assist in the preparation of Home Information Packs.
Software / CMS Suppliers
To achieve its full potential, a future e-conveyancing system must integrate with software applications commonly used by lenders, conveyancing solicitors and property lawyer s as well as Home Information Pack providers .
Conveyancing Solicitors and Property Lawyers
Conveyancing Brokers, Conveyancing Solicitors and Property Lawyers too are increasingly making use of the internet to market and to provide their conveyancing and Home Information Pack services to clients. The use of bespoke conveyancing case management software is commonplace and specialist online conveyancing services are now available that give clients online access to their conveyancing cases, keeping them up to date with progress of their conveyancing transaction . For Fridaysmove views on case tracking systems please see the article Conveyancing Case Tracking - A benefit or an admission?