When is electronic conveyancing going to happen in Victoria?

The rules set out protocols for:

creating electronic documents

settling transactions in real time and for value

arranging payment of the stamp duty

lodging and registering documents at the Titles Office

notification to various authorities, including the municipal council, water authority and state land tax

Within the PEXA system there are three ways of providing source funding to effect an e-conveyancing transaction (inclusive of financial settlement):

subscriber financial institutions;

a solicitor’s trust account; or

a PEXA source account.

The Legal Services Commissioner has recently notified practitioners that:

It is important to note that the PEXA Source Account is not a trust account within the meaning of the Legal Profession Act 2004, and therefore the protection offered by the Fidelity Fund may not exist if a default occurs in the PEXA Source Account. It is also important to understand that the interest earned on PEXA Source Accounts funds will accrue to PEXA, and not the Public Purpose Fund.

As mentioned in previous blogs (25 Aug 2014; 1 Oct 2014; 6 Nov 2014; and 17 Dec 2014), new verification of identity requirements are being introduced progressively in each state. These requirements include production of appropriate forms of identification of potential borrowers, as a means of avoiding fraud.

As a concession to Luddites, it should be noted that the paper conveyancing system will continue to be available for the time being. It will continue to be used where the representative of one or other party is not a PEXA subscriber.

In other words, PEXA is not (yet) compulsory.

However, as the various banks are now pushing forward with it, this may change!

W G Stark

Hayden Starke Chambers