Legal Insights

COVID-19 new witnessing of documents regulations – what does this mean for NSW property transactions and verification of identity?

By Alicia Albury & Susanne Rakoczy

• 28 April 2020 • 3 min read

On 25 April 2020 the Electronic Transactions Amendment (COVID-19 Witnessing of Documents) Regulation 2020 (NSW) (the Regulation) commenced, introducing new provisions for witnessing documents during COVID-19.

The Real Property Act NSW (1900) and the NSW Conveyancing Rules require verification of identity (VOI) to be undertaken on the parties to NSW property transactions before the dealings giving effect to those transactions are lodged for registration, including lodgement for registration through an electronic conveyancing platform, such as PEXA. Until recently, the standard of a VOI set out in the NSW Conveyancing Rules required a face-to-face interview between the person signing the relevant property transaction document and a person authorised by the Conveyancing Rules to conduct the VOI (Identity Agent). At the face-to-face interview, the person having their identity verified would provide certain original identification documents for the Identity Agent to sight and copy.

With the requirement for social distancing and many people working from home as a result of COVID-19, it is much more difficult to conduct an in person VOI. The Australian Registrars' National Electronic Conveyancing Council (ARNECC), has confirmed that Identity Agents may conduct a VOI during this period using audio visual links, such as Skype, FaceTime and Zoom. No distinction is made to the capacity in which a VOI interview is being conducted, meaning a mortgagee or mortgagee’s agent can conduct a VOI interview with a mortgagor using audio visual link, the same way a lawyer can conduct a VOI interview with its own client.

Evidence that the VOI interview has taken place must be recorded (in writing) and must still be kept to comply with the requirement that all evidence supporting a dealing must be kept for at least seven years from the date of lodgement of the relevant dealing.

How does the Regulation apply to mortgages, leases and other registrable dealings?

While the Regulation allows parties to various documents including deeds and agreements to sign and have their signatures witnessed using audio visual link, it does not affect or override the Registrar General’s guidelines for the execution of dealings. It is not entirely clear whether dealings that are not in the nature of the documents listed in the Regulation can be witnessed in accordance with the regime set out in the Regulation.

Where dealings can be electronically lodged through an electronic conveyancing platform such as PEXA, the party authorised by a client authorisation form (CAF) can electronically sign registrable dealings from the comfort of their own home office. It has never been a requirement of ARNECC that a CAF must have a wet signature and the Real Property Act NSW (1900) provides that a CAF can be electronically signed in NSW.

However, where a property dealing in NSW cannot be electronically lodged through an electronic conveyancing platform, the Registrar General’s guidelines require the wet signatures of all parties on the same dealing. The Regulation clearly allows for the witnessing of mortgages and leases using audio visual link as these dealings are deeds. The parties to these dealings and their witnesses will all need to sign the same hard copy document but do not need to be face-to-face in person to do this. To clarify, the position whether other property dealings which are not expressed to be deeds or agreements, can be witnessed without a face-to-face in person meeting. The Conveyancing Rules have been temporarily changed to allow all paper land dealings, plans and s88B instruments to be signed and witnessed using audio visual link. The change to the Conveyancing Rules does not alter the requirement for VOI to take place.

Maddocks has produced guides to a range of legal issues raised by COVID-19. You can access these guides here.

Looking for guidance on these changes?

Get in touch with the Property & Development team.

By Alicia Albury & Susanne Rakoczy

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