Electronic Conveyancing (Adoption
of National Law) Act 2012
Tony Cahill
_______________________________________________________________________
Electronic Conveyancing (Adoption of National Law) Act 2012
This Act (“the 2012 Act”) received assent on 20 November 2012, and was
proclaimed to commence on 1 January 2013. The 2012 Act is the first
legislative step in the implementation of electronic conveyancing.
National Electronic Conveyancing (NEC) is to be the new environment for
completing real property transactions and lodging land title dealings
throughout Australia, aiming to assist industry participants in more
efficiently completing conveyancing and mortgage transactions. It is not
strictly speaking an electronic conveyancing environment – contract
formation, vendor disclosure, and even (in NSW) requisitions will still be
paper-based. NEC will allow for electronic settlement, funds movement,
revenue collection and lodgment / registration.
The key concepts (and, sadly, key acronyms) in electronic conveyancing
can be summarised as follows:
 The Registrars in each jurisdiction will be the ultimate guardians of
the integrity of the system and will work co-operatively through the
Australian Registrars' National Electronic Conveyancing Council
(ARNECC).
 Initially, there will be one Electronic Lodgment Network (ELN)
administered by a single operator (ELNO). There is the potential for
(and some interest in) other ELNs being established in due course.
Each ELNO will need approval by the Registrar in a participating
jurisdiction.
 The initial ELNO will be National E-Conveyancing Development
Ltd (NECDL) which is developing a system called Property
Exchange Australia (PEXA). The current shareholders in NECDL
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are Governments, major lenders and, most recently, the Link
Group, which operates a Share Registry business, Superannuation
Administration and Shareholder and Member Analytics services.
 The Registrar will impose conditions on an approval of an ELNO,
including compliance with operating requirements and participation
rules.
 The ELNO will enter into participation agreements with subscribers
(typically solicitors, conveyancers and financial institutions).
 The participation rules will deal, inter alia, with client authorities,
digital signing, document retention and the need to comply with the
operating requirements and participation rules.
 Non-electronic conveyancing will be available for those unwilling
or unable to “move to the e way”.
 Each participating jurisdiction will pass its own enabling legislation
adopting the Electronic Conveyancing National Law (an appendix
to the enabling Bill passed in the lead jurisdiction). The approach is
comparable to the introduction of the former Uniform Consumer
Credit Code (pre National Credit Code). New South Wales is the
lead jurisdiction – hence the Electronic Conveyancing (Adoption of
National Law) Act 2012.
 The Electronic Conveyancing National Law forms an Appendix to
the 2012 Act. As well as setting out numerous operative provisions,
the National Law sets out (as Schedule 1) its own lengthy
interpretation provisions. Given the differences between the
interpretation statutes in the various jurisdictions, it was thought
prudent to develop a self-referencing interpretation regime for the
National Law.
 The 2012 Act is high-level legislation; a Bill containing detailed
amendments to the existing property statutes in NSW can be
expected early in 2013.
What still needs to be done before the electronic system is operational?
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 Building the technology framework – in particular, PEXA. As at
August 2012, release 1 was half-built.
 Settling the terms of the Model Operating Agreement and Model
Participation Rules – ongoing consultation between AARNEC and
stakeholders.
 Determining the fate of the CT – a discussion paper was issued by
LPI in late 2012.
 More detail about the financial nuts and bolts – to take one
example, can a practitioner without a trust account be a subscriber,
and if so will the relevant regulator be happy?
 Redrafting standard forms in common use (e.g. contract for sale of
land) to make them e-ready.
 Risk allocation - to the satisfaction of all stakeholders.
What then is the (hoped-for) timeframe for implementation?
 First transaction likely to occur in Victoria (because a state-based
electronic conveyancing system (ECV) is already in place – albeit
not working as well as had been hoped).
 Limited range of transactions to be brought into scope in Q2 2013 –
Stage 1 deployment is likely to be limited to mortgages, discharges
of mortgage and refinances.
 Release 2 of PEXA will open up the scope to multi-party
transactions, and therefore to matters involving solicitors and
conveyancers. Release 2 is expected to be able to accommodate
transfers, settlements, caveats and “notices” [presumably e.g. a
“priority notice” (Qld) or “settlement notice” (Tas)]. The publicly
available roadmap indicates testing of Release 2 in late 2013 / early
2014, with deployment in Q2 2014.
More information is available from:
The NECDL website: http://www.necd.com.au/
The LPI NECS readiness site: http://necnsw.lpi.nsw.gov.au/
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Electronic Transactions Act 2000
With effect from 1 January 2013, as a consequence of the move towards
electronic conveyancing, section 23C of the Conveyancing Act 1919 (the
key “Statute of Frauds” equivalent in New South Wales) is no longer
excluded from the operation of certain provisions of the Electronic
Transactions Act 2000 (specifically, section 7(1) and Division 2 of Part 2).
Those provisions are as follows:
7 Validity of electronic transactions
(1) For the purposes of a law of this jurisdiction, a transaction is not
invalid because it took place wholly or partly by means of one or
more electronic communications.
…
Division 2 Requirements under laws of this jurisdiction
8 Writing
(1) If, under a law of this jurisdiction, a person is required to give
information in writing, that requirement is taken to have been met if
the person gives the information by means of an electronic
communication, where:
(a) at the time the information was given, it was reasonable to
expect that the information would be readily accessible so as to
be useable for subsequent reference, and
(b) the person to whom the information is required to be given
consents to the information being given by means of an
electronic communication.
(2) If, under a law of this jurisdiction, a person is permitted to give
information in writing, the person may give the information by
means of an electronic communication, where:
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(a) at the time the information was given, it was reasonable to
expect that the information would be readily accessible so as to
be useable for subsequent reference, and
(b) the person to whom the information is permitted to be given
consents to the information being given by means of an
electronic communication.
(3) This section does not affect the operation of any other law of this
jurisdiction that makes provision for or in relation to requiring or
permitting information to be given, in accordance with particular
information technology requirements:
(a) on a particular kind of data storage device, or
(b) by means of a particular kind of electronic communication.
(4) This section applies to a requirement or permission to give
information, whether the expression give, send or serve, or any other
expression, is used.
(5) For the purposes of this section, giving information includes, but is
not limited to, the following:
(a) making an application,
(b) making or lodging a claim,
(c) giving, sending or serving a notification,
(d) lodging a return,
(e) making a request,
(f) making a declaration,
(g) lodging or issuing a certificate,
(h) making, varying or cancelling an election,
(i) lodging an objection,
(j) giving a statement of reasons.
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9 Signatures
(1) If, under a law of this jurisdiction, the signature of a person is
required, that requirement is taken to have been met in relation to an
electronic communication if:
(a) a method is used to identify the person and to indicate the
person’s intention in respect of the information communicated,
and
(b) the method used was either:
(i) as reliable as appropriate for the purpose for which the
electronic
communication
was
generated
or
communicated, in the light of all the circumstances,
including any relevant agreement, or
(ii) proven in fact to have fulfilled the functions described in
paragraph (a), by itself or together with further evidence,
and
(c) the person to whom the signature is required to be given
consents to that requirement being met by way of the use of the
method mentioned in paragraph (a).
(2) This section does not affect the operation of any other law of this
jurisdiction that makes provision for or in relation to requiring:
(a) an electronic communication to contain an electronic signature
(however described), or
(b) an electronic communication to contain a unique identification
in an electronic form, or
(c) a particular method to be used in relation to an electronic
communication to identify the originator of the communication
and to indicate the originator’s intention in respect of the
information communicated.
(3) The reference in subsection (1) to a law that requires a signature
includes a reference to a law that provides consequences for the
absence of a signature.
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10 Production of document
(1) If, under a law of this jurisdiction, a person is required to produce a
document that is in the form of paper, an article or other material,
that requirement is taken to have been met if the person produces, by
means of an electronic communication, an electronic form of the
document, where:
(a) having regard to all the relevant circumstances at the time the
communication was sent, the method of generating the
electronic form of the document provided a reliable means of
assuring the maintenance of the integrity of the information
contained in the document, and
(b) at the time the communication was sent, it was reasonable to
expect that the information contained in the electronic form of
the document would be readily accessible so as to be useable
for subsequent reference, and
(c) the person to whom the document is required to be produced
consents to the production, by means of an electronic
communication, of an electronic form of the document.
(2) If, under a law of this jurisdiction, a person is permitted to produce a
document that is in the form of paper, an article or other material,
then, instead of producing the document in that form, the person may
produce, by means of an electronic communication, an electronic
form of the document, where:
(a) having regard to all the relevant circumstances at the time the
communication was sent, the method of generating the
electronic form of the document provided a reliable means of
assuring the maintenance of the integrity of the information
contained in the document, and
(b) at the time the communication was sent, it was reasonable to
expect that the information contained in the electronic form of
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the document would be readily accessible so as to be useable
for subsequent reference, and
(c) the person to whom the document is permitted to be produced
consents to the production, by means of an electronic
communication, of an electronic form of the document.
(3) For the purposes of this section, the integrity of information
contained in a document is maintained if, and only if, the information
has remained complete and unaltered, apart from:
(a) the addition of any endorsement, or
(b) any immaterial change,
which arises in the normal course of communication, storage or display.
(4) This section does not affect the operation of any other law of this
jurisdiction that makes provision for or in relation to requiring or
permitting electronic forms of documents to be produced, in
accordance with particular information technology requirements:
(a) on a particular kind of data storage device, or
(b) by means of a particular kind of electronic communication.
11 Retention of information and documents
(1) If, under a law of this jurisdiction, a person is required to record
information in writing, that requirement is taken to have been met if
the person records the information in electronic form, where:
(a) at the time of the recording of the information, it was
reasonable to expect that the information would be readily
accessible so as to be useable for subsequent reference, and
(b) if the regulations require that the information be recorded on a
particular kind of data storage device—that requirement has
been met.
(2) If, under a law of this jurisdiction, a person is required to retain, for a
particular period, a document that is in the form of paper, an article
or other material, that requirement is taken to have been met if the
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person retains, or causes another person to retain, an electronic form
of the document throughout that period, where:
(a) having regard to all the relevant circumstances at the time of
the generation of the electronic form of the document, the
method of generating the electronic form of the document
provided a reliable means of assuring the maintenance of the
integrity of the information contained in the document, and
(b) at the time of the generation of the electronic form of the
document, it was reasonable to expect that the information
contained in the electronic form of the document would be
readily accessible so as to be useable for subsequent reference,
and
(c) if the regulations require that the electronic form of the
document be retained on a particular kind of data storage
device—that requirement has been met throughout that period.
(3) For the purposes of subsection (2), the integrity of information
contained in a document is maintained if, and only if, the information
has remained complete and unaltered, apart from:
(a) the addition of any endorsement, or
(b) any immaterial change,
which arises in the normal course of communication, storage or display.
(4) If, under a law of this jurisdiction, a person (the first person) is
required to retain, for a particular period, information that was the
subject of an electronic communication, that requirement is taken to
have been met if the first person retains, or causes another person to
retain, in electronic form, the information throughout that period,
where:
(a) at the time of commencement of the retention of the
information, it was reasonable to expect that the information
would be readily accessible so as to be useable for subsequent
reference, and
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(b) having regard to all the relevant circumstances at the time of
commencement of the retention of the information, the method
of retaining the information in electronic form provided a
reliable means of assuring the maintenance of the integrity of
the information contained in the electronic communication, and
(c) throughout that period, the first person also retains, or causes
the other person to retain, in electronic form, such additional
information obtained by the first person as is sufficient to
enable the identification of the following:
(i) the origin of the electronic communication,
(ii) the destination of the electronic communication,
(iii) the time when the electronic communication was sent,
(iv) the time when the electronic communication was
received, and
(d) at the time of commencement of the retention of the additional
information covered by paragraph (c), it was reasonable to
expect that the additional information would be readily
accessible so as to be useable for subsequent reference, and
(e) if the regulations require that the information be retained on a
particular kind of data storage device—that requirement has
been met throughout that period.
(5) For the purposes of subsection (4), the integrity of information that
was the subject of an electronic communication is maintained if, and
only if, the information has remained complete and unaltered, apart
from:
(a) the addition of any endorsement, or
(b) any immaterial change,
which arises in the normal course of communication, storage or display.
Prior to 1 January 2013, section 23C was a provision prescribed as being
not within the reach of the 2000 Act (together with a variety of statutes,
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principally relating to electoral and FOI matters – the list is in clauses 4
and 7 of the Electronic Transactions Regulation 2012).
The Table of Contents to the 2012 Act is attached as an Appendix to the
paper.
*****
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Appendix
Electronic Conveyancing (Adoption of National Law) Act 2012
Table of Contents
Long title
Part 1 Preliminary
1 Name of Act
2 Commencement
3 Definitions
Part 2 Application of Electronic Conveyancing National Law
4 Adoption of Electronic Conveyancing National Law
5 Meaning of generic terms in Electronic Conveyancing National
Law for purposes of this jurisdiction
6 Responsible tribunal for Electronic Conveyancing National Law
(NSW)
7 Exclusion of interpretation legislation of this jurisdiction
Part 3 Miscellaneous
8 Regulations
9 (Repealed)
Appendix Electronic Conveyancing National Law
Part 1 Preliminary
1 Short title
2 Commencement
3 Definitions
4 Interpretation generally
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5 Object of this Law
6 Law binds the State
Part 2 Electronic Conveyancing
Division 1 Electronic lodgment
7 Documents may be lodged electronically
8 Registrar to process documents lodged electronically
9 Status of electronic registry instruments
Division 2 Client authorisations and digital signatures
Subdivision 1 Client authorisations
10 Client authorisations
11 Effect of client authorisation
Subdivision 2 Digital signatures
12 Reliance on, and repudiation of, digital signatures
Part 3 Electronic Lodgment Networks
Division 1 Preliminary
13 Electronic Lodgment Network
Division 2 Operation of Electronic Lodgment Networks
14 Registrar may provide and operate ELN
15 Registrar may approve ELNO to provide and operate ELN
16 Conditions of approval as ELNO
17 Effect of approval as ELNO
18 ELNO required to comply with operating requirements
19 Renewal of approval as ELNO
20 Revocation or suspension of approval as ELNO
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21 Monitoring of activities in ELN
Division 3 Operating requirements and participation rules
22 Operating requirements for ELNOs
23 Participation rules
24 Registrar to have regard to nationally agreed model operating
requirements and participation rules
25 Publication of operating requirements and participation rules
26 Subscribers required to comply with participation rules
27 Waiving compliance with operating requirements or participation
rules
Division 4 Appeals
28 Appeal against decisions of Registrar
29 Determination of appeal
30 Costs
31 Relationship with Act establishing responsible tribunal
Division 5 Compliance examinations
32 Definitions
33 Compliance examinations
34 Obligation to cooperate with examination
35 Registrar may refer matter to appropriate authority
36 Land titles legislation not limited
Part 4 Miscellaneous
Division 1 Delegation
37 Delegation by Registrar
Division 2 Liability of Registrar
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38 Registrar not obliged to monitor ELN or conduct compliance
examination
39 No compensation
40 Registrar not responsible for additional services provided by
ELNO
Division 3 Relationship with other laws
41 Other laws relating to electronic transactions not affected
42 Powers may be exercised for purposes of this Law
Schedule 1 Miscellaneous provisions relating to interpretation
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