NSW Land Registry Services (NSWLRS) will commence converting paper certificates of title held by Authorised Deposit Taking Institutions (ADIs) to electronic certificates of title (eCTs) over each weekend in September as follows:

• ANZ: 1 September 2018
• CBA: 2 September 2018
• Westpac: 8 September 2018
• NAB: 9 September 2018
• All other ADIs: 15, 16, 22 and 23 September  2018. For further information, see the NSWLRS website.

This means two things.  First, after the conversion almost all transactions involving a Discharge of Mortgage will involve an eCT.   Secondly, practitioners with matters due to settle during the conversion period will need to check whether the certificate of title has been converted to an eCT. These matters, called “in flight transactions” by the banks, may be excluded from the bulk conversion. The bank will provide an exclusion list to NSWLRS on the Thursday prior to the relevant weekend conversion date.

Practitioners can use the free certificate of title (CT) inquiry on the NSW LRS website to establish whether the certificate of title is paper or electronic. If the paper certificate of title has been converted to an eCT, the folio will show:

"NO CERTIFICATE OF TITLE HAS ISSUED FOR THE CURRENT EDITION OF THIS FOLIO.

CONTROL OF THE RIGHT TO DEAL IS HELD BY [mortgagee name]."

What is Control of the Right to Deal (CoRD)?

The Right to Deal with a land title is the inherent right of the registered proprietor to deal or transact with their land. A party has CoRD when that party has authority to consent to the registration of subsequent interests in land. For example, if land is mortgaged, the first registered mortgagee has CoRD and is called the CoRD Holder.

What to do for a paper settlement with an electronic certificate of title

With an eCT, the CoRD Holder needs to consent to the transaction by lodging a CoRD Holder Consent through PEXA. This is done by the ADI, but all parties to the transaction will need to supply relevant details of the transaction to enable completion of the Consent. For information about how to request and facilitate a CoRD Holder Consent, see the Registrar General’s Guidelines.

The Request for CoRD Holder Consent should be submitted to the ADI by the vendor’s solicitor ideally when the Discharge Authority is submitted, and in any case well before the settlement date. The purchaser’s solicitor will need to supply details of any incoming mortgagee to the vendor’s solicitor (pursuant to clause 4.1 of the Contract for the sale and purchase of land) to enable completion of the Request for CoRD Holder Consent.

Prior to attending the paper settlement, practitioners should check that the CoRD Holder Consent is in place and correctly describes the transaction by obtaining another certificate of title (CT) inquiry. The CoRD Holder Consent is the electronic equivalent of handing over the paper CT at settlement. It provides consent to the registration of the specified dealings and sets out all parties to the transaction.