Going paperless – abolition of the Certificate of Title

With conveyancing moving almost completely to the digital environment, paper certificates of title in NSW will soon be a thing of the past.

The Real Property Amendment (Certificates of Title) Bill 2021 (‘Bill’) was passed through NSW Parliament on Tuesday 11 May 2021 (and assented on 24 May 2021) and allows the abolition of paper certificates of titles in NSW.

On 11 October 2021, two significant changes will be introduced to the land titles system in NSW. These are as follows:

• Paper certificates of titles will be cancelled together with the control of the right to deal (CoRD) framework; and

• All land dealings will be required to be lodged electronically, in a move towards ‘100% eConveyancing’.

Amendment to the Real Property Act 1900

From 11 October 2021, which is known as ‘Cessation Day’, under s33AAA of the Real Property Act 1900, all current certificates of title will have no legal effect and certificates of title will no longer be issued by the Registrar General.

The Bill amends the Real Property Act 1900 by removing:

• The requirement for the Registrar-General to issue certificates of title for real property;

• Requirements for the Registrar-General to place recordings on certificates of title;

• Powers of the Registrar-General to require the production of certificates of title; and

• Requirements for parties with the right to deal with titles to consent when accepting a dealing for lodgement or registration.

Move to 100% e-conveyancing

From Cessation Day, paper dealings will no longer be accepted for lodgement by the Registrar General and all land transactions must be lodged electronically (eConveyancing).

Instead of issuing a certificate of title when a dealing is registered, the Registrar General will instead issue a new document called an ‘Information Notice.’

The 100% move to the eConveyancing system will not only mean more efficient transactions and reduced settlement delays, but it will also protect against lost certificates as well as fraud and illegal obtaining of titles, as it is a more secure system with advanced checks in place.

“There have been no fraud cases relating to e-conveyancing since it began in New South Wales in 2014, but during that time, the New South Wales Government has paid over $7 million in compensation for fraud cases involving paper conveyancing transactions.” (Second Reading Speech – The Hon. Taylor Martin)

More complex transactions, which can currently only be lodged via paper, are to be lodged electronically through an Electronic Lodgement Network Operator such as PEXA.

What does this mean for those who hold paper titles?

Land owners who currently hold paper titles are not required to do anything with their certificates, however the changes will mean that your certificate of title will no longer be a legal document.

Land owners who own unencumbered land, but have their certificates of title held or stored by another party may wish to request to have it back. From 11 October 2021, there will be no remedy under the Real Property Act 1900 to retrieve a certificate of title from another party, as it will no longer be a legal document.

Detailed guidance will be provided to the public by the Office of the Registrar General.

For creditors/mortgagees who have simply held certificates of title as security rather than registering an interest, they will need to consider alternatives such as lodging a mortgage or caveat to secure their interests.

If you have any questions regarding this article, please contact Andrew Grima or Melissa Potter.

Authors: Craig Munter, Stella Sun and Helen Pham