This sizeable report, weighing in at a hefty 196 pages, indicates that despite the relatively enthusiastic response (over 80% of respondents said they could not suggest a better approach), widespread fears were expressed about the reliability and security of the new system - particularly that of digital signatures. Another significant concern amongst respondents was the possible impact on their existing IT systems. Many respondents stated that e-conveyancing must integrate with existing casework management systems, e-mail systems and word processing software.
Agency and electronic signatures
Many firms had reservations about signing documents on behalf of their clients and the possibility of fraud being committed. They expressed concern at the ability of the conveyancer to change documents while they were still in the system - up until the final exchange. The general opinion was that amended documents should be re-signed by the parties who signed the document originally, since such amendments would have the effect of 'breaking' the signature. They also suggested that any changes made to a signed document ought to be clearly highlighted.
Network access and security
Respondents expressed concern about network access, security and monitoring. They suggested that the Law Society should assist the Land Registry in a regulatory capacity. At the same time, they recommended that all the professional bodies develop co-operative agreements to co-ordinate the running of the system.
The chain matrix
Co-ordinating the chain matrix made respondents fear that client confidentiality may be compromised. However, from a purely practical point of view, the benefits would be extremely limited if one conveyancer in the chain was still using the paper based system. They then suggested that more and shorter chains, rather than fewer and longer chains would speed up the system. Nevertheless, the chains' transparency might allow all concerned parties to locate blockages and generally help with PR and uptake.
A phased approach
Most respondents thought that running dual systems - as required for a phased approach - would cause problems in their business and pass additional administrative costs onto their clients. This however was preferable to a 'big bang' approach. Most respondents were resigned to this course of action and they could see no other option, if the phased approach only existed for a finite period. At the end of that time, they would expect their patience to be rewarded with a tried and tested e-conveyancing system. Some were prepared to wait several years, others not.
Many practitioners are already using a standard form of contract, at least in relation to contracts for the sale of residential property. Respondents also believed that a reference incorporating one of the sets of sale conditions (such as the Law Society's Conditions of Sale) could also be entered as standard. Given this degree of standardisation in residential contracts, this could be used as the basis for a standard electronic format. Such standardisation however should not come at the expense of the individual's right to enter into a contract of any form. It was also deemed unfeasible in commercial transactions.
Some respondents felt that the system would impose additional burdens such as installing new systems, educating and training users and sorting out the application prior to completion. Others however objected to the fact that the certainty of title is afforded before the application is lodged with the Registry. They also pointed out the reduction in post-completion time spent on dealing with requisitions which were no longer deemed a priority by the parties concerned and are often difficult to settle.
Freezing the register
When dealing with transactions that have long, deferred or indefinite completion dates, methods of freezing and unfreezing the register were also discussed. One solution was to adopt a two-stage approach. Firstly, one could register the contract and either apply for non-freezing or just allow the automatic 30-day freeze to expire. Secondly, the attorney could apply for the register to be re-frozen or frozen just before completion. Extending the freezing period was also suggested. Protecting the buyer and the lender is paramount when unfreezing the register.
There was almost unanimous support for a permanent connection to the e-conveyancing system, particularly from the commercial conveyancing community. Cost however was seen as something that may well make the smaller firms think twice. Commercial practitioners in particular emphasised their need to be able to access the system from anywhere in the world. If the system became available 24/7, this would meet their needs. Regarding DIY conveyancing, the following quote is worthy not only for its pithiness but also as a tart rejoinder to those who maintain that conveyancing can be performed by non-conveyancers:
"Not even the best heart surgeon in the land is permitted to operate upon his own dog. That privilege is quite properly reserved for the veterinary surgeon. The advantages of electronic conveyancing should be sufficient to justify the exclusion of unregulated amateurs."
Electronic Funds Transfer (EFT) systems
Views on existing systems of Electronic Funds Transfer (EFT) systems of payments were also canvassed. Generally, respondents felt that such a system had to be:
On the subject of impact assessment, the following describes how conveyancers feel about the eventual introduction of an e-conveyancing system:
"Many others felt that the costs had been considerably underestimated, particularly as the extent and nature of the system had yet to be settled upon. They felt that the IT investment to enable electronic signatures, upgrade software and comply with network access agreements and the associated training that would be required would negate any efficiency savings". The RIA decided that "e-conveyancing is not itself likely to reduce their costs per transaction by much, if at all".
Most respondents felt that costs would rise and that these would be passed on to clients. Unless the terms of network access agreements were sufficiently flexible, partners and senior practitioners would be involved far more than currently in clerical tasks on the system naturally adding to costs. Some respondents specifically queried the validity of the specific set-up and connection costs mentioned for case management systems within the RIA - they claimed that these costs were an underestimate.
A number of respondents urged the Registry to examine existing service providers within the current conveyancing system. They asked the RIA to ensure that e-conveyancing integrated with what was already available to provide greater flexibility and choice and limit the cost impact upon practitioners.
Respondents felt that the human element was being underestimated and that the implementation of an electronic system would not per se speed up the conveyancing process. When commenting on the general impact on firms, the following is representative of the fears the smaller ones have: "Many [responses] focussed on the belief that the IT investment required [hardware, software and staff training costs] would lead to the consolidation of the market amongst a smaller number of larger firms. Many small conveyancing firms would struggle, particularly in rural areas."
The potential benefits of the new system could far outweigh the disadvantages by speeding up the conveyancing process, closing the registration gap and providing greater transparency for both practitioner and clients. All practitioners saw it as a natural progression in terms of using e-technologies and appreciated that it had the potential to address or improve the present system.