Electronic Conveyancing Is Just A Click Away

(a perspective from an e-commerce lawyer and a property lawyer - a variation of the article that appeared in the May edition of the Solicitors' Journal and the June edition of Negotiator Magazine)

New Technology, New Opportunity

We hope that doesn't sound too new Labour because electronic conveyancing will happen and with the right will it could happen quite soon. Like Marvin the paranoid android, your computer probably has a brain the size of a planet, which you rarely get to use to anywhere near its full potential. The development of electronic conveyancing could be good news for both you and your computer. But how real is the government's commitment to this technological innovation?

Consultation Paper

On a more serious note, on March 5th 2001 the Lord Chancellor's Department issued a consultation paper entitled "Electronic Conveyancing, a draft order under section 8 of the Electronic Communications Act 2000", a grand-sounding piece of subordinate legislation with less grand, though important, content. In this article we will review the draft regulations in the context of "true" electronic conveyancing, namely the overall conveyancing process being conducted electronically, not the mere contract for sale and transfer of legal title. The consultation paper follows the Homes Bill, currently before Parliament, which deals with another key element in the process of speeding up conveyancing, the highly controversial "seller's packs".

Call it "spin" or otherwise but the Government has declared its intention to make the UK the leading environment for e-business by the end of 2002. As part of that initiative, the Electronic Communications Act 2000 ("the Act") was brought in to provide a legal infrastructure for e-business. An essential element of the Act was to give electronic signatures and contracts equal status to written contracts. It requires substantial subordinate legislation to realise its goal and these draft regulations regarding electronic conveyancing ("the draft regulations") are part of that enabling legislation.

The Government has also announced plans to improve substantially the system by which property is bought and sold in England and Wales. In particular it wants to see the whole process speeded up, supposedly to help avoid "gazumping".

Current Position

To sum up the current law regarding the form of contracts and conveyances:

Section 2 (1) of the Law of Property (Miscellaneous Provisions) Act 1989 ("the 1989 Act") provides that "A contract for the sale or other disposition of an interest in land can only be made in writing"

Section 52 of the Law of Property Act 1925 provides that "all conveyances of land or of any interest therein are void for the purposes of conveying or creating a legal estate unless made by deed".

Section 36A of the Companies Act 1985 allows a company to execute deeds by affixing its common seal or alternatively by the signatures of a director and the secretary or of two directors.

Section 1 (3) of the 1989 Act...