Abolition of Certificates of Title

Abolition of Certificates of Title


Conveyancing changes

From 11 October 2021 lawyers and licensed conveyancers (together, representative subscribers) will no longer need to ask their clients for a copy of their CT when acting on a sale or when lodging a dealing for registration.

Subscribers will no longer be requested to enter the CAC (Certificate Authentication Code) details taken from a CT for consent purposes in an Electronic Lodgment Network Operators (ELNO) workspace.

Representative subscribers are advised to not use a CT as the sole source of evidence for the purposes of establishing their client’s right to deal with the land. Further guidance on establishing a client’s right to deal with land can be found on the ARNECC website.

Where a subscriber has relied on a CT to establish right to deal in a transaction conducted before 11 October 2021, the CT, or a copy of it, must be retained in line with the requirements for retaining supporting evidence in the NSW Participation Rules.

Clients CTs

Currently, representative subscribers would be storing thousands of CTs in safe keeping on behalf of their clients. When CTs are cancelled, some firms may wish seek instructions from their clients on what to do with their CT. Others may want to just return CTs to their clients. Others may want to take the ‘do nothing’ approach, or even destroy them. All are viable options a firm should consider.

If a firm is considering destroying a CT it is recommended that instructions are sought from the client in the first instance. Despite the CT no longer being a legal document, it is still the client’s personal property and should be treated as such.

It is not necessary for representative subscribers to stamp a CT as “cancelled” or mark it in any way if returning it to their client after 11 October 2021. Likewise, previous advice was to keep the CAC secure. From 11 October 2021 the concept of the CAC is redundant and is no longer required to be kept securely.

Mortgagee consent will still need to be obtained for the registration of certain dealings (refer to the Registrar General’s Guidelines). Previous reliance on CoRD holder consent or production of title does not substitute for express consent from the mortgagee to be bound by the terms of the dealing (as opposed to consenting for the title to be used for registration).

For example, when acting for parties to a lease of mortgaged property, if the mortgagee is to be bound by the terms of the lease, the Subscriber acting for the landlord will need to request an express consent from the mortgagee in writing and upload that onto the electronic workspace for lodgment with the land registry.

Equitable mortgages and liens

Equitable mortgages and liens secured by possession of a CT will obviously become less secure once CTs are abolished. Firms who are holding CTs as security for payment of costs are advised to urgently make alternate arrangements to secure their debt. For more information please see Important changes to liens and equitable mortgages.

Source www.registrargeneral.nsw.gov.au

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