Conveyancing Table of Contents
In this chapter1. Generally The United Kingdom Law Commission conducted a review of conveyancing from 1971 to 1974 and pointed out:- "The first step in the search of any procedure must be to ask what it is sellers and buyers of houses want. We have little doubt that the great majority of both are agreed on the answer to that question. It is that when an offer for a house has been made and accepted at a stated price, neither party should be allowed to go back on that bargain without a valid reason, The seller's main interest is, and always has been , to get the agreed price as soon as possible, whilst giving himself time to get another house and to move out into it. The buyer, on the other hand, having agreed to the price wants to know that he can stop house-hunting and concentrate his energies and attention on the house he has bought."1 The goal in conveyancing is to transfer the property being sold to the purchaser so than the purchaser's expectations are not defeated by some affectation unknown to him and to do this in a time frame that will allow the vendors to move out and the purchasers to move into possession. One may be excused for thinking that this should not be such a difficult goal to obtain but this leaves out of consideration the complexities of the present conveyancing law, the competing interests of the various parties involved in the conveyancing transaction and the present inadequate system for record affectations on land. 2. The problem of gazumping Much attention of reformers of the conveyancing system in recent times has been focused on gazumping. For instance on the passing of the Conveyancing (Sale of Land) Amendment Bill, 1987 through the Legislative Assembly it was said in the second reading speech:- "The purpose of these Bills is twofold. First, they are designed to overcome the undesirable practice of gazumping and, secondly, to promote a greater degree of efficiency in the conveyancing system operating in New South Wales....It is during the time taken to prepare and issue the contract that a purchaser, in the belief that a binding arrangement has been reached with the vendor proceeds to expend money undertaking searches and enquiries. Should the vendor accept a higher offer from another purchaser during this period, the earlier purchaser is said to be gazumped. Unfortunately, on many occasions, the loss suffered by the person who loses the property is quite considerable".2 From the second reading speech in the Legislative Assembly on the passing of the Conveyancing (Sale of Land) Amendment Bill and Auctioneers and Agents (Sale of Land) Amendment Bill in 1989:- "This legislative package is intended to overcome the problems which were found to exist with the present legislation and to provide a balance between the need to protect parties against the practice of gazumping in property transactions and the need for streamlined and workable conveyancing procedures."3 The Macquarie Dictionary defines "gazump' as "force a buyer to accept a price higher than that previously agreed upon". The practice of gazumping became prevalent in the United Kingdom during the 1960s and reached substantial proportions during 1971. The Law Commission of the United Kingdom described gazumping in these terms:- "It is generally is generally used to describe the situation in which the seller of a house, having agreed "subject to contract" to sell it at an agreed price, withdraws from the bargain or threatens to do so, in the expectation of receiving a higher price. The prospective buyer who has been "gazumped" is then put in the position either of having to pay the higher price or of losing the house. If he loses the house, any expenditure which he has incurred in anticipation of the proposed purchase will have been wasted. In addition, he will often have been put to a good deal of trouble, and suffer frustration, annoyance and disappointment as the result of what he is likely to regard a sharp practice on the part of the seller."4 The Law Commission was asked in 1971 to consider whether any legislation could deter or prevent gazumping. In 1974 the Commission came to the conclusion that neither practice or the law should be changed. An interesting comment made at the time of the United Kingdom Law Commission's report challenged some of the basic objections relation to gazumping:- "An owner, through not fault of his own, has to sell his home and sell it quickly. . His estate agent advises him that a proper price is $ 7,500.00, but as he is in a hurry he ought to accept an offer of $ 7,100.00, the offer being expressly subject to contract (and in the purchaser's mind, subject to (i) the purchaser's obtaining a satisfactory offer of an advance, (ii) a satisfactory survey, (iii) the purchaser's being satisfied that the adjoining land will not be build on, (iv) the purchaser's wife not changing her mind, (v) that he finds a buyer for his house at the maximum price, and so on and so forth). Another buyer comes along and offers $ 7,500.00 and yet another $ 7,750.00. The unfortunate owner perseveres with the first applicant who, after eight weeks, withdraws because his job has taken him to another part of the country or for any other reason, good or bad, whatever. Apparently, it is not suggested that the seller should have any remedy. It is, however, suggested that the buyer should if he wishes to stick to the $ 7,100.00. The owner, it is said, should sell at $ 7,100.00 and enable the buyer to subsell at $ 7,750.00 or pay for the buyer the expense to which he has been put, even if he did not want to go ahead but keeps quiet about it. ... Why should an owner take less than the full price because he was badly advised or even because he did not realise the full value? It si not as if a buyer is going to offer more because he thinks the owner is not asking the best price. ... The overwhelming majority of both vendors and purchasers act fairly and responsibly. Solicitors struggle to avoid races and if pressed by their vendor clients do what they can to ensure that the first in the field has a reasonable opportunity to sign first. Vendors, both big and small, even if they feel that they have been misled as to the market value generally stick to what they have agreed. Purchasers are not all paragons of virtue nor do good purchasers become bad vendors."5 One result of attempting to protect the purchaser from gazumping is that the purchaser may "gazunder" the vendor. This was seen to occur when Preliminary Agreements were required. during the conveyancing boom in Sydney in 1988. At worst some purchasers would enter into two or more Preliminary Agreements waiting to see if they could find a buyer themselves for the property at a higher price. At best it was possible for a purchaser to take his time to make up his mind as to which property he would purchase and run the risk of losing only a few hundred dollars. 3. Efforts to date From 1920 to 1965 the standard form of contract was not amended. Since 1965 there has been editions of the contract in 1972, 1982, 1986 and 1988. The amendments to conveyancing practice brought about by the Conveyancing (Sale of Land) Amendment Act, 1989 and Auctioneers and Agents (Sale of Land) Amendment Act, 1989 will furnish a further opportunity to amend the standard form of contract. It would appear that conveyancing is presently undergoing a period of accelerated change. Efforts are being made to deal with some of the perceived problems in conveyancing, notably the delay between exchange of contract and settlement and the problem of gazumping. To combat the problem of gazumping the so called "anti-gazumping legislation" was introduced in 1987. However this legislation was ill-conceived and this was forseen by lawyers at the time: "The analysis has disclosed several ambiguities, omissions and deficiencies in the legislation which, at an absolute minimum, should be rectified by legislative amendments and regulations. That is required in order to simplify and to rationalise the entire process involved in the preliminary agreement and reduce the likelihood of procedural error by either party. If the Government persists with this mechanism in an endeavour to restrict gazumping, it needs to be relatively simple and workable in the variable circumstances in which it will apply, i.e. sale with or without an estate agent, solicitors acting for all parties, one or more of the parties acting for themselves (which can be either the vendor or the purchaser or both). This legislation is likely to create considerable anxiety and practical problems in the orderly dispatch of conveyancing transactions for lawyers as well as clients. It would be entirely false to regard it as any simplification or rationalisation of conveyancing as it adds further complexity in all domestic transactions. The legislation will place considerable added burden on parties seeking to act for themselves. Persons untrained in conveyancing practice would not understand the complexities of this legislation and it is unlikely that any public education campaign can or will equip parties acting for themselves to handle these procedures efficiently and effectively."6 The "anti-gazumping legislation" legislation was introduced by the Unsworth Labour Government just prior to State elections without adequate consultation with interested professional bodies. Unfortunately when that government lost the election the new Greiner Liberal Government did not repeal the "anti-gazumping legislation" legislation immediately, This left conveyancing in a most unsatisfactory situation after two Supreme Court decisions held that the "anti-gazumping legislation" could not be validly complied with. More recently the "cooling-off" legislation commenced on the 1st October, 1990 after the legislation had been passed through Parliament the previous year. Whilst the Bills were being debated in Committee in Parliament, there were some interesting exchanges between the Minister and Paul Whelan for the Opposition, including the following:- Whelan: "As I said in the second reading debate, clearly this is not going to go far enough to protect purchasers of properties and exclude legal obligations on vendors and agents. it si not adequate in the circumstances. I repeat what I said: the Government had a perfect opportunity to rid conveyancing of the evil of gazumping in the market-place by agreeing to the amendment to enable proper consultation with everybody in the industry. That opportunity has now been lost. So also has the possibility of cleaning up the property market-place... Causley: We have tried for two or three years in New South Wales to find the perfect system. I do not think it exists. Whelan: It does. Causley: In most of these legal situations one solicitor believes he knows the answer and another believes he has the answer, but never the twain shall meet. That is the present situation. It is one of the idiosyncrasies of the law. Lawyers make money arguing among themselves. They will not agree on this vexatious problem. As I said, I admit that this legislation is not perfect. Sometimes I sit in this Parliament and wonder about the laws which we continually bring in to try to protect people. I remember clearly the principle of caveat emptor, buyer beware, which operated when I grew up. It was drummed into people that they had to know what they were doing if they bought something. No amount of legislation passed by this Parliament will protect people from themselves, unfortunately. I for one - I know there are people who disagree with me - would never buy a property without the advice of a solicitor. Other people do their own conveyancing, and that is their problem. The vast majority of people will not bypass members of the legal profession. Obviously, they are the experts and I would use them if I were buying or selling property. I hope those amendments will go some way towards alleviating the fears of the Law Society about this legislation. I have had discussions at all times with all interested parties. The Real Estate Institute has impressed upon me that it is not interested in conveyancing. That does not seem to be getting through to the Law Society. The Real Estate Institute wants only to tidy up the legislation so that the distressing gazumping problem can be overcome..." The above exchange raises a number of issues which will be considered in more detail below. 4. Possible future directions for conveyancing (a) Generally The United Kingdom Law Commission in its review of conveyancing had considered various options for changing laws or practice including:- * Reducing the interval of time between reaching an agreement subject to contract and entering into a binding contract, in order to restrict the chance of withdrawal by either party. For example, by the vendor obtaining a building condition report for the purchaser and vendors instructing their solicitors when placing properties on the market, to obtain the required searches and to make them available to the buyer. * The grant of options was not favoured because it tied up the property for the vendor, precluding sale to anyone else in the meantime. * Auctions and tender purchases certainly reduce the scope for negotiations and for gazumping. However, it was not considered acceptable to require sales by auction, nor did it offer an acceptable solution to persons intending to sell and to purchase at the same time. where the sale is by auction or tender, every unsuccessful bidder will have thrown away all the costs which he has incurred before making his offer, including those of any survey which he or his mortgagee has had carried out. * Buyers and sellers would probably like to be able to enter into some form of contract at the time when the price is agreed. The contract would be binding on both parties, but the buyer would be able to withdraw, without liability, if he could not finance his purchase or if the usual enquires, searches, inspections and investigations showed that there was something substantially wrong with the property. However the Law Commission was unable to devise a satisfactory form of conditional contract for general use in sale and purchase contracts. * Criminal sanctions were not favoured as it might render unadvised vendors liable to criminal sanctions and it would be only directed against sellers and not buyers. * Reimbursement of the buyer's wasted expenditure was thought not a means of eliminating gazumping and in the event of a dispute would call in for investigation the whole course of negotiations. * Compensation for the buyer's disappointment was also considered unsatisfactory, for several reasons, including the problem of assessing damages. The Commission in its Working Paper concluded: "We recognise that that practice [gazumping] is open to criticism in that it enables either party to the negotiations to withdraw at any time before a contract is finally concluded, whether for good cause or not, and whether or not the other party has been induced by an agreement "subject to contract" to incur expenses. As recent experience has shown, this freedom to withdraw can give rise, abnormal market conditions, to public concern. But we have found that freedom to withdraw is a practical necessity if buyers are not to be placed in an exposed position. We have, however, been driven to the conclusion that the cause of the problem lies outside the law and the practice, and that there are clear dangers in altering a system which has been carefully designed, and which serves its purpose well in the vast majority of cases, solely for the reason that in exceptional (and perhaps temporary) circumstances the system is capable of being used unscrupulously."7 This does not sound too promising for us when we look to ways of improving the conveyancing system. One thing to keep in mind, however, is that since 1974 there has been vast improvements in computerised data storage and retrieval technology that could not have been envisaged by the Commission. (b) Other Australian States It is impossible to review in any detail the conveyancing systems existing in Australian States, other than New South Wales. Generalising however it can be indicated that States such as South Australia have a simpler system of land title, in that the majority of land is Torrens title. South Australia is also developing its computer database of titles and restrictions so that land title information can be more readily accessed. In Victoria the Transfer of Land Act, 1958 covers Torrens title land and Sale of Land Act, 1962 governs much of the conveyancing process. In a cash sale the real estate agent completes a contract note that is forwarded to the vendor's solicitor and a formal contract of real estate is prepared by the vendor's solicitor. This contract is sent to the purchaser's solicitors and must include certain prescribed information. The information required is: particulars of any mortgage; information as to easements and restrictions; details of zoning; outgoings; building approvals; notices and evidence of title. The purchaser must do his searches and enquiries before exchanging the contract of real estate although requisitions are allowed after exchange. The purchaser of non-commercial and non-rural land also has a three day cooling-off period from the signing of the contract of real estate and if exercised the purchaser is entitled to the return of all moneys paid less $ 100.00 or 0.2 % of the purchase price (whichever is greater). The standard form of contract for the sale of land in Queensland have at least two interesting provisions when compared to the standard contract used in N.S.W. Time is expressed to be of the essence8. Thus where a party is in default by failure to complete the contract on the due date, no notice is necessary and the innocent party will be at liberty to elect immediately whether to repudiate the agreement and sue for damages for breach or sue for specific performance. This is unless the innocent party has waived the stipulation as to time of the essence. The other interesting provision is that requiring interest to be paid on any moneys not paid by due dates9. This type of provision is something that is becoming more prevalent in N.S.W. contracts. Under Queensland conveyancing procedure, all searches appear to be carried out between the date of contract and completion, including a survey. This is the case even though Queensland purchasers appear not to have any special protection from patent defects i.e. a defect which the purchaser is likely to discover upon an inspection by the use of ordinary care. The only suggestion made by writers10 is that if the purchaser has any doubt about the state of the premises a warranty as to their condition should be included in the contract. It would appear that the conveyancing systems adopted by other States, such as Queensland and Victoria, has not led to any simplification or greater sophistication of the conveyancing process and in fact has given rise to considerable litigation. (c) Increased disclosure by the vendor There was some comment at the time of the 1986 "vendor disclosure legislation" that the legislation did not go far enough and require the vendor to annex an survey and section 317AE certificate to the contract. A Cabinet release on the 19th July, 1989 in relation to the "cooling-off" legislation stated that: "Vendors will be required to increase their present level of disclosure. The objective is to have sufficient documentation with the contract for a purchaser to approach the lending institution without needing further searches or inspections (other than valuation) to meet the institution's requirements. The proposed requirements will be for pest inspection, survey, and s. 317AE Certificate. The details will be determined in consultation with industry during the drafting stage." However the consultative committee to the Government for the proposed 1989 amendments was of the unanimous view that the vendor disclosure regulations should not be amended to require that a pest inspection report, survey report and s. 317AE Certificate be attached to contracts for the sale of residential property. This was because it was felt that requiring those documents to be annexed would create more difficulties than their inclusion would be intended to resolve.11 If the objective was to protect the purchaser thought could also be given to requiring the vendor to annex to the contract a pest certificate and builders or engineers report. The vendor could then give warranties in this regard. To adopt this course would require consideration of a number of matters. For instance, the additional cost to be borne by the vendor, which would be passed on to the purchaser, unless the vendor changed his mind and withdrew the property from sale. Surveys, in particular, are expensive to obtain however they are now undertaken in the course of the erection of homes and would only need to be updated if there have been additions or alterations to the improvements on the property. (d) Central Register of Restrictions The government must do more that pay lip service to reform of the conveyancing system. More importantly the government must not seek to make political mileage out of amendments to the conveyancing system at the sake of genuine reform. To ensure that definite improvements to the system are made change should not occur until such time as all interest professional bodies have been consulted. A comment by Professor Andrew Lang is interesting in this regard: "Notwithstanding the Government's expressions of good intentions to improve conveyancing. I suspect that there is some pandering to sectional interests, an attempt to have the perceived problems and complaints "go away" and little serious attempt at real conveyancing reform. A much more meaningful move would be the provision of adequate funds, technical support and coercion to create a proper computerised register of restrictions and land data bank. That would speed up and reduce the cost of conveyancing and provide a real community benefit.12" New Zealand for instance has a Statutory Land Charges Registration Act which allows charges against land authorised by statute but without an express provision for entry on title to be entered. If it can be entered on the register, and is not, it cannot be enforced as a charge against land. This covers charges from irrigation to demolition of dangerous buildings to termite eradication. Some years ago the Land Titles Office commenced recording all certificates of title on computer. This is called ALTS (Automated Land Titles System). ALTS is presently13 handling more than 95 % of Torrens dealing lodgements and title searches. It is possible to obtain a copy of the certificate of title via a computer and modem connected to the Land Titles Office's Automated Land Titles System. It is also possible to conduct final searches of dealings lodged for registration. Apparently more than 40 % of ALTS searches are undertaken by on-line access from customers' premises. Copies of plans and the terms of encumbrances on the title can not as yet be obtained by on-line. It is proposed to expand the remote access facilities by progressively making plans and dealings available on-line, together with other records such as the Purchaser's Index and the Old System Deeds Index. Imaging technology is now available and is presently being used in South Australia to streamline the retrieval and management of titles. Documents and diagrams can be processed and stored in a mainframe computer for on-line retrieval via computer and modem. In late 1987 the Central Register of Restrictions (CRR) was designated as a core project of the State Land Information System (SLIS) which is run by the State Land Information Council (SLIC). The objective of the project is to simplify conveyancing by establishing a central database of land restrictions, enabling enquirers to make one instead of many inquiries to find out if any authority has an interest in a particular parcel of land. The initial pilot system for the CRR began operations on the 1st March, 1990 and provides a screening service based on parish. A number of authorities are already participating in the scheme and have recorded their interests on the central database. The authorities are: AGL Sydney Ltd; Electricity Commission of NSW; School Education Department of NSW;Pipeline Authority; Mine Subsidence Board; and Health Department of NSW. At present inquiries received through the Land Titles Office Property Information Inquiry Service are passed against the CRR and, where the parish is recorded as clear, a clear certificate is issued and returned to the applicant immediately. If an authority is recorded as not clear, or is not yet participating in the scheme, the inquiry is forwarded to the authority for normal investigation and response. Negotiations are proceeding to incorporate additional authorities in the scheme and the system is being enhanced to provide for recording interests at the parcel level by the end of 1990. Those with on-line facilities may gain direct access to the CRR for obtaining clearances. Apart from the normal authority inquiry fee, and the existing service fee, applicants will not incur additional fees for the use of the CRR. Positive steps have been made to set up such a land data base. The Land Titles Office has commenced to set up its data base. However a tremendous amount of work has yet to be done and the support of the Government is required. (e) Property shops "As conveyancing legislation, practice and markets evolve, many solicitors have felt threatened by what they see as an inevitable incursion into traditional areas of work for lawyers. Some have taken the lead from overseas jurisdictions and become involved in the business of real estate marketing. The involvement is by no means new and is not confined to high profile operations, but recent developments have seen it become an issue of major concern to members of the Society."14 Scotland is often cited as an example of the "one stop property shop" concept in action. Apparently some 70 % of transactions are handled by such businesses. However, the law societies of England and Wales, Ireland, New Zealand and Ontario, Canada have permitted their solicitors to be involved in the sale of real estate and some actively encourage their participation. The Law Institute of Victoria has approved a solicitor practising as a solicitor and also as an estate agent provided that he follows certain guidelines including maintaining separate trust accounts for the businesses. Any serious consideration of property shops is clouded by what is seen as the competing interests of solicitors and real estate agents. At various times recently there have been proposal for "property shops" to be set up that provide both conveyancing and real estate agency services. In December, 1989 the Real Estate Institute of New South Wales claimed that it would be establishing "its own conveyancing facility early in the new year".15 That claim has not yet been fulfilled and it may be that the the Real Estate Institute has reversed its attitude. The Law Society of NSW has indicated that it takes the view that the selling of real estate is best left to real estate agents. This is an appropriate attitude for the Law Society to take because it is possible that the introduction of property shops would not increase or decrease the involvement of solicitors or real estate agents in conveyancing transactions. Any property shops established would have both solicitors and real estate agents as directors and shareholders. Advocates of property shops suggest that agents have a difficulty in acting for the vendor when they have such intimate contact with the purchaser:- "The whole basis of Solicitors Property Services is that the interests of the general public will be better served by an agency owned by solicitors using qualified real estate specialists with proven expertise. By gaining control of the client at the first point of contact and introducing solicitors' ethical principles to the whole real estate transfer process, members of Solicitors Property Services believe they have a tremendous opportunity to prosper by giving an improved and complete real estate service."16 This would appear to be an interesting comment as it is based on ethical principles. Occasionally solicitor find themselves in a conflict situation if the one firm acts for both vendor and purchaser and a dispute erupts. The firm of solicitor must then refer both the vendor and the purchaser to other solicitors so that they may have the benefit of independent advice. Surely the potential for a conflict of interest is increased if the real estate agent, solicitor for the vendor and perhaps solicitor for the purchaser are all represented by the one firm. It is submitted that property shops are only an alternative method of servicing the public and it does not follow that their introduction in N.S.W. would necessarily improve the conveyancing system. Solicitors and real estate agents should not confuse the discussion of the future direction of conveyancing by making threats in relation to the delivery of real estate services. (f) Settlement after registration The present conveyancing practice in N.S.W. is for settlement to take place when the documents appear to be in order for registration. The risk for the purchaser is that the documents might not be able to effect registration but this risk is minimised by the purchaser doing a final search of the register just before settling. This system of settlement is not adopted in other countries and its suitability for N.S.W. has been questioned: "We do it the way we do because we haven't modified an old system settlement to accommodate the guarantee on registration provided by the Torrens system. The provinces of Saskatchewan and Alberta, where I was first admitted, received the Torrens system while still federally administered as part of the North West Territories, in 1886. The Canadian prairies of 1886 were much different to New South Wales at the time. The Canadian Pacific Railway had just been completed the year before. The last great Indian uprising, the North-West Rebellion, had been defeated and its leader, a fine French speaking western Canadian, hanged a week after the last spike joined the railroad. The Territory was almost vacant. As a result, neither province, established in 1905, had ever had any system of recorded land tenure other than Torrens system. The law society in each jurisdiction guaranteed both a solicitor's trust account and his undertaking for value. Solicitors accepted the trust cheques of other solicitors. One solicitor would also accept another solicitor's undertaking in writing that he had the money for the purchase in his trust account and that he would pay it out upon registration in accordance with the contract, or, as could occur, that he would accept that condition when imposed upon him by the solicitor for the vendor in delivering to him an executed transfer an where applicable, duplicate title. Banks, ever ready to be of service, customarily parted with an executed discharge of mortgage in return for an undertaking that the bank would be paid on registration of the discharge (the Land Titles Act in each jurisdiction impounded the duplicate title in the hands of the Registrar when a mortgage was registered). Formal settlement, almost unavoidable in New South Wales, never took place, except in some commercial matters, and then for different reasons. Following contractual agreement, there was an exchange of undertakings, a lodgement of dealings, registration, and a delivery of trust cheques. I don't recall anyone suggesting paying the vendor out in cash before registration. Is this just a curious tale from a far-off land where cowboys and Indians once roamed? I hope it is not. We don't do it that way here because solicitors won't accept other solicitors' trust cheques, and there is no point in asking the Law Society to guarantee a solicitor's undertaking for value. Why then, don't we fill the gap by asking the Law Society to act as broker - to hold the funds following settlement, and then to pay them out in accordance with the contract."17 The above writer went on to say that the system he puts forward has a number of advantages. These include protection for the purchaser, more speedy settlements and the entrenchment of solicitors as the conveyancing experts. Interestingly, the Law Society of N.S.W and an on-line computer bureau, Lawpoint -OTC, have recently embarked on a program to introduce a system of on-line Law Society sponsored settlements. This has yet to be established but may not be far from the above proposals. The aim is to have a central register of restrictions that can be accessed via a computer from remote locations. For settlement to take place at the point where the central register is being accessed requires some system as outlined to ensure that outgoing mortgagees where paid out. Discharges of mortgage and any other restrictions on the title that had to be removed could be authorised and registered on the spot. It just may be that this on-line system of settlements could provide the solution to the problem of protecting outgoing mortgagees. (g) SEISIN Regularly settlements involve a number of parties by the time incoming and outgoing mortgagees are included. Settlement would normally take place at the office of the outgoing mortgagee holding the certificate of title. Often times this will be a location that is neither near the vendor nor purchaser. It becomes quite involved to arrange settlement and delays often result. In recent years efforts have been made to facilitate settlements by making provision for documents to be checked by parties before settlement and the settlement funds being transferred without the need for all the parties to be present at the one location. This appears to be a way to increase efficiency particularly with the advent of electronic funds transfers and computer link- ups. 5. Summary The purchase or sale of real estate is a transaction of the utmost importance to all in the community. For many home owners the purchase of a property represents the largest capital expenditure they may embark upon and they may buy and sell property only a few times during their life. For those involved in commerce the purchase and sale of real estate is an integral part of their business. In these circumstances perfecting the conveyancing process should receive high priority from the government. However has not been the case and what we have seen is piecemeal and haphazard tampering with the system. As with any human endeavour conveyancing involves a number of different interests, such as, vendors, purchasers, real estate agents, solicitors for vendors and solicitors for purchasers. However the interests of various government departments and neighbours should not be overlooked. Attempts to improve conveyancing by favouring one or other of these interest groups is only pandering to sectional pressures. Unfortunately many of the parties interested in conveyancing adopt an adversary attitude to conveyancing. While this approach may be suitable for litigation it forgets that contract is a meeting of minds. Ideally parties should govern there relationship and be protected by the terms of the contract to such an extent that no party can be taken by surprise and end up with something that they had not contracted to buy. In fact all parties involved will benefit from a fair and prompt conveyancing transaction. Another important aspect of conveyancing is that many of the problems experienced are generated by the system itself but by the parties having competing interests. The law of real property is a complex area of law and on occasions a party may pursue a complex point of law to achieve a result that they desire. This is evidenced by the standard form of contract now being some eight or more pages compared with a couple of pages in 1920. However to be fair, many aspects of day to day life and commercial transactions are now much more complicated than fifty years ago. The difficulties experienced in land transactions at the present time are not the fault of one or other of the interested parties. The difficulties cannot therefore be overcome by shifting aspects of the conveyancing process from one interested party to another. Attempts to do so show a total lack of understanding of the problems and at worst purposeful ignorance of those problems to pursue political expediency. It is not unrealistic in these days of consumerism to throw away any notion of caveat emptor and require the vendor to disclose all that there is to know about the property being sold. However, there may be affectations that even the vendor is not aware of and to augment the vendor's disclosure a central and comprehensive system of recording and searching for affections must be in place. Combine this with a Law Society sponsored settlement procedure and we would achieve a very efficient system of conveyancing in N.S.W..
1 New South Wales Conveyancing Law & Practice by Professor Lang [5-004]. 2 New South Wales Conveyancing Law & Practice by Professor Lang [5-000]. 3 The New Conveyancing Legislation 90/1 by Andrew G. Lang, The College of Law Continuing Legal Education 1990, p. 3. 4 New South Wales Conveyancing Law & Practice by Professor Lang [5-002]. 5 Conveyancing and Property Lawyer (1972) at pp. 1-2. 6 Ibid [5-074]. 7 New South Wales Conveyancing Law & Practice by Professor Lang [5-004]. 8 Condition 26 of the form of contract approved by the Queensland Law Society in 1989. 9 Ibid condition 11. 10 The Standard Land Contract in Queensland by Duncan & Weld 3rd Ed., Law Book Co., 1990, p. 133. 11 Anti Gazumping Legislation by David De Carvalho & Bill Macquarie, The New Conveyancing Legislation 90/1, The College of Law Continuing Legal Educatin 1990, p. 50. 12 The New Conveyancing Legislation 90/1 by Andrew G. Lang, The College of Law Continuing Legal Educatin 1990, p. 19. 13 October, 1990. 14 NSW Law Society Journal, August, 1990 p. 39. 15 Law Society of New South Wales Caveat No. 91, 9th April, 1990. 16 Rob Knowsley, Solicitors Estate Agency Ltd in a letter to the editor published in NSW Law Society Journal, October, 1990 p. 6. 17 Louis Charelbois one of the authors of Conveyancing Service N.S.W., Butterworths leading loose-leaf publication in this field in an article Proposals and Settlements: Suggestions for Change published in NSW Law Society Journal, August, 1990 p. 60.
