Review of conveyancing industry announced
Victoria’s conveyancing industry is under scrutiny following the announcement of a review of the regulation of the conveyancing industry by Victorian Attorney-General Rob Hulls and the Minister for Consumer Affairs John Lenders.
Conveyancing is the legal term for the transfer of real property (house and/or land) from one party to another. The transfer of real property needs to be:
- in writing (Sale of Land Act, Instruments Act); and
- registered with the Land Registry.
In Victoria, people have the choice of using a lawyer for conveyancing, or using a conveyancing firm. However, many consumers do not understand the difference between engaging a lawyer and engaging a conveyancer who does not need to have legal qualifications.
Buying or selling a home is one of the most important contracts anyone will enter into – and often the largest financial investment too. There are many traps for the unwary, which is why it is wise to seek legal advice. While the documentation may appear simple, it is important that a seller (vendor) provides all the information and purchasers understand what the information actually means.
The risks of not engaging a lawyer are highlighted in cases where a property transfer becomes more complex than previously anticipated (e.g. in navigating State Revenue Office obligations, such as where fractional interests require payment of stamp duty by tenants in common).
The conveyancing industry review follows recent media reports on a police investigation of claims that Grove Conveyancing Services, Geelong has defrauded consumers of undetermined sums of money. The business has since closed.
The matter highlights the benefits of consulting a lawyer when purchasing or selling property. Lawyers are required to hold professional indemnity insurance in order to practise and are regulated by the Legal Practice Act 1996, both of which provide protection to consumers.Victorian conveyancers are currently regulated under the Legal Practice Act 1996; however, the Act is meant to regulate lawyers.“Conveyancers are not licensed or required to be insured or have trust accounts and do not have to be legally qualified,” Mr Hulls said.
The terms of reference for the review include:
- assessment of the current regime to determine what risks consumers face, including the administration of consumer and third party funds;
- complaints handling and public confidence in the system;
- consideration of a consistent national approach across the states; and
- review of the definition of “legal work” and “conveyancing work” in the Legal Practice Act 1996.
The discussion paper following the review is expected to be released for comment early in 2005.
Useful web links
www.liv.asn.au/public/legalinfo/property, LIV.
http://www.reiv.com.au/, Real Estate Institute of Victoria.
http://www.sro.vic.gov.au/, State Revenue Office.
Disclaimer:
The information in this newsletter is not intended to be a complete statement of the law relating to the issues raised. Accordingly, no person should rely on this information without first obtaining specific advice from Ms Eleanor Coates of our office. | 
