Law Society plan to cut the time it takes to make property deals


THE PROCESS of buying and selling property, with the ownership transferred from one person to another and a new mortgage in place, could be reduced to five days under proposals unveiled by the Law Society yesterday.

These came in a document on eConveyancing presented to the President of the Law Reform Commission, Mrs Justice Catherine McGuinness.

The commission established a working group on eConveyancing in 2002, and in 2005 asked the Law Society to devise a vision for eConveyancing. The document, "eConveyancing: Back to Basic Principles", published yesterday, is the result.

It points out that the current process of transferring title of land (typically houses) is not adapted to deal with modern society, increased volume and diversity of transactions and market expectations. Many of the elements currently involved in the process have nothing to do with the strict transfer of land.

The conveyancing process has been used by the State as a tool for implementing social policy, for example, the collection of tax, statutory enforcement and various other aims, according to the document.

As a result even the most basic residential conveyance required multiple inquiries that have little to do with ownership, transfer of and security to title.

The Law Society is recommending that the process be pared back and only those elements which impact on the transfer of title be retained. These should then be dealt with electronically.

The Law Society document states that the existing system as it stands should not be transferred into an electronic record. Instead the entire process should be re-engineered to suit the electronic and online environment.

The first step should be that all land in the State, and any interest in land, should be registered in the Land Registry. All rights which currently affect land without registration should be removed. This will require legislative change.

For several hundred years the law has been that the risk in buying property lay with the purchaser, who then had responsibility for all the searches and other safeguards necessary to ensure that the title was good. The society is recommending that the responsibility of disclosure should move to the vendor. This would be reflected in the next step, the drafting of the eContract.

The proposed new system also requires the existence of a complete electronic searchable Planning Register, with detailed information about all planning and environmental issues affecting a property, including zoning, applications, permissions, enforcement notices, environmental data, CPOs, preservation orders, road widening proposals, etc.

In relation to tax, all taxes should be personal and payable on self-assessment. Revenue should put in place a system that facilitates the payment of tax as part of the transfer process.

In relation to loans, the loan approval should issue and be signed electronically, containing all the terms and conditions of the mortgage. Registration of the new loan should be virtually instantaneous.

All steps would be completed electronically and all stakeholders could communicate through an electronic workplace or hub.

It would be necessary that all stakeholders would agree common identifiers for the searching of data through the hub, for example, postal address, name of owners, postal code and folio number. It will also be desirable for each client to have their own electronic signature so as to sign the eContract themselves, but this is not expected to be feasible for some time. In the interim the solicitor would have an electronic signature.

The document has been submitted to other stakeholders for discussion in the context of the Law Reform Commission project.