An interview with Judy Hogarth, conveyancer at KLH Conveyancing, about how technology has changed conveyancing over her time in the industry.

How long have you been a conveyancer? And how have things changed?

I’ve been in the industry for nearly 20 years.

When I started, everything was paper and cheques. Bank cheques. Literally pieces of paper which represented money.

Some of my clients nowadays don’t even know what a cheque is! They were born in 1995 or so, and they live in a different world.

What else was paper-based?

Twenty years ago, email wasn’t a thing.

All our documents were posted. Literally put in an envelope and sent wherever they needed to go.

We’d post transfers to the other party. We’d post requisitions. We’d order council searches by post.

I think that’s where the six week settlement period came from. You needed six weeks to send everything backwards and forwards.

What else was different?

My first boss didn’t have a computer. Everything was typed and posted. A few years later we upgraded to computers and then started using email. It made correspondence a little bit faster, but only when the other side had email too. The legal industry is generally slow on the uptake of technology.

What about settlement?

Settlement was a madhouse. We used to have specialist settlement rooms where all the parties met, for multiple matters.

There was a Revenue bench where you had to take your stamp duty cheques for Revenue NSW. All the banks had representatives too, with the bank cheques which had been drawn up at the bank in advance.

When you walked in there might be 25 people or more, all swapping documents. I still remember the first time I walked into a settlement room. It looked chaotic. I couldn’t understand how anyone got things done.

You have to remember, each settlement has multiple partners, so there’s a lot of documents to exchange with a lot of parties. Those cheques I talked about. For one sale, there was a cheque to the bank, a cheque for the vendor, a cheque for pay stamp duty, a cheque to council. All that was happening at one table for one matter, but with so many settlements happening all around, it was crazy.

So what changed?

Things went on like that until very recently when they brought PEXA in.

PEXA – Property Exchange Australia is a electronic settlement platform. It was formed as a company in 2010 and worked closely with the Australian authorities, legislators, banks, State Revenue offices, departments of land titles and so on. They all had to be on board to make turn that chaotic room into an electronic settlement workspace. But as I said, the legal industry doesn’t adopt technology fast. PEXA didn’t really take off until the end of 2018, when the states made it compulsory.

How do things work now?

With PEXA, there’s one central platform, online and real time. There’s a separate workspace for each settlement, where you can see everything about that matter.

• Is the bank ready?
• Are our funds available?
• What documents does the bank need?
• Who hasn’t prepared their documents?

We’ve always dealt with matters in a holistic way, but now it’s even better because we can see everything in one place. We can see if something’s not ready, then reach out to whoever’s concerned.

There have been times when it’s two weeks before settlement and the other party hasn’t even logged into the workspace. When we see something like that we give them a call and get things happening.

How are workspaces set up?

Vendors’ representatives set up the workspace, after unconditional exchange. That is, once the cooling off period expires or just after the contract becomes binding. For an auction sale, that’s immediately after the auction.

Occasionally when I’m acting for a buyer, I find that a week after the contract became unconditional, a workspace hasn’t been set up. In that case, I’ll set it up and invite everybody in. While the guidelines say it should be the vendor’s representatives, anybody can do it. And for us, it’s really important to get the bank into the workspace as soon as possible. Banks have the most processes, so they’re the most likely point of delay.

What about the purchaser and the vendor? Do they log on too?

There’s actually an app, called PEXA Key, which is brilliant. It’s real time too, so clients can see what’s happening.

We also ask them to use the app for secure tasks. For example, when they upload their bank account details for any surplus funds, or when we provide them with trust account details. The app is very secure, very safe. It’s much better than sending account details via email, where they can be intercepted and changed.

Property law firms are a target for business email scams because of the large sums involved. We recommend PEXA Key to prevent that. If it’s not possible, then we say call and check details to make sure nothing has been intercepted and changed. But that’s a lot more work.

What do clients think of PEXA key?

We’ve had really positive feedback on it because clients can see what’s happening real time. The app has push notifications, so sometimes they know things before we do!

It’s also great when there are changes. For example if the settlement time changes, clients know straight away. It’s just so much more efficient.

So how fast can you do a settlement now with PEXA?

The fastest we’ve ever managed is two weeks. In that case, there was no bank involved on either side. The vendor owned the property outright. We had a cash buyer.

If banks are involved, discharging a mortgage takes two weeks, and for an incoming mortgage it’s generally four weeks.

One thing to note is that if there’s a mortgage, whether you owe money on that or not makes no difference. The mortgage is registered on the title until the bank registers a discharge of mortgage. We’ve had cases where the client paid the loan off 25 years before, but the bank never lodged a discharge. So they still need 14 days to get ready to settle.

But it’s still a lot faster than the old 6 weeks. And a lot less running around too!