With the rise of electronic conveyancing, the New South Wales government is in the process of phasing out paper certificates of title. Paper certificates of title will no longer be issued to banks who lodge a first mortgage signed on or after 1 March 2017. Instead, the bank will be noted on the electronic titles register as having the ‘control of the right to deal’.
In light of the impending removal of paper certificates of title, New South Wales has recently amended the Real Property Act 1900 (NSW) (‘Act’) to allow purchasers to lodge a ‘Priority Notice’ to protect their interests in land. As part of a national transition to electronic conveyancing, priority notices have also been introduced in Victoria and South Australia, while similar notices have already existed in Queensland and Tasmania for some time.
What is a ‘Priority Notice’?
A Priority Notice is a prescribed electronic form that can only be lodged through the national electronic conveyancing platform, PEXA, from 28 November 2016. A Priority Notice can be lodged under section 74T of the Act by anyone who intends to lodge a dealing to give effect to an entitlement to a legal or equitable interest in land and any associated dealings (e.g. a mortgage or discharge or mortgage). For most Priority Notices, this will be a purchaser under a contract of sale. If the Priority Notice is in the approved form, the Registrar-General may accept the lodger’s entitlement to lodge it on face value.
Under section 74W of the Act, while a Priority Notice is current, similar to a caveat it prevents the registration of any dealing or plan relating to the land other than the following:
How long does a Priority Notice last?
Once a Priority is lodged, it will last for 60 days under section 74V of the Act. If required, a lodger can apply to the Registrar-General for an extension of this period by 30 days. Provided such application is made before the expiration of the 60-day period and is in the approved form, the Registrar-General will grant the requested extension.
If the dealings specified in a Priority Notice are lodged or the 60-day period expires (subject to an extension), the Priority Notice will be automatically removed. At any time before the expiration of a Priority Notice, its lodger, a person protected by the Priority Notice or their lawyer/conveyancer can withdraw the Priority Notice under section 74X of the Act. Otherwise, the Registrar-General has the power to remove a Priority Notice if he or she is satisfied that the:
If you require assistance with buying or selling property or electronic conveyancing, please contact HPL Lawyers on (02) 9905 9500.