New South Wales Bills Explanatory Notes

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CONVEYANCERS LICENSING BILL 1992

CONVEYANCERS LICENSING BILL 1992*

NEW SOUTH WALES
EXPLANATORY NOTE

(This Explanatory Note relates to this Bill as introduced into Parliament)

The objects of this Bill are:

(a) to provide for the licensing of conveyancers; and
(b) to regulate the practice of conveyancing by licensed conveyancers; and
(c) to entitle persons who suffer pecuniary loss as a result of. a failure to account
by a licensed conveyancer to payment of compensation by the Association of
Property Conveyancers and to provide for the compulsory insurance of the
Association against such claims; and
(d) to provide for the appointment of managers and receivers for businesses
conducted by licensed conveyancers; and
(e) to establish a procedure for dealing with complaints made against licensed
conveyancers; and
(f) to establish a Conveyancers Licensing Committee; and
(g) to enact other provisions of a minor, consequential or ancillary nature.

The Bill also amends certain other Acts and contains certain savings and transitional
provisions consequent on the enactment of the proposed Act.

PART 1--PRELIMINARY

This Part (clauses 1­5) contains machinery provisions (Short title, commencement
and definitions) in connection with the proposed Act. Clause 4 defines "conveyancing
work" as legal work carried out in connection with any transaction that creates, varies,
transfers or extinguishes a legal or equitable interest in residential property (other than
residential property having an area of more than 10 hectares) or that otherwise affects
* Amended in committee--see table at end of volume.

residential property. The definition is expressed to include certain specified kinds of
legal work and to exclude certain other kinds of legal work Legal work is defined to
mean work that, done for fee or reward, would give rise to an offence under Part 9 of
the Legal Profession Act 1987 if done by anyone other than a practising barrister or
practising solicitor. Clause 5 defines certain classes of persons as disqualified persons
for the purposes of the proposed Act. A disqualified person will not be eligible to hold a
licence under the proposed Act or to be employed in the conduct of a conveyancing
business.

PART 2--LICENSING

This Part, containing 4 Divisions, establishes the procedure for obtaining a licence to
carry out conveyancing work and specifies the effect of such a licence. The procedures
for obtaining a licence involve both the proposed Conveyancers Licensing Committee
("the Committee") and the Law Society Council ("the Council").

Division l--Preliminary

This Division (clauses 6­9) contains provisions:

· specifying that the effect of a licence is to protect a licensed conveyancer from
proceedings for an offence under Part 9 of the Legal Profession Act 1987 in
relation to the kinds of legal work that the licensed conveyancer is permitted by
the proposed Act to carry out
· defining the procedure for obtaining a licence (which requires a certificate of
eligibility) and prescribing the qualifications for a licence
· requiring an applicant for a licence to have paid the appropriate fidelity
contribution under Division 2 of Part 4
· requiring an applicant for a licence to be covered by an approved policy of
professional indemnity insurance
Division 2--Certificates of eligibility

This Division (clauses 10­16) contains provisions:

prescribing the manner in which applications are to be made to the Committee
for certificates of eligibility
enabling the Committee to require an applicant to furnish further particulars in
connection with an application
providing for the manner in which the Committee may determine an application
enabling the Committee to require the imposition of conditions on a licence
granted by the Council
requiring the Committee to notify the applicant of its decision within 14 days
providing that a certificate of eligibility remains in force until it is withdrawn or
until a new certificate is granted
enabling the Committee to withdraw a certificate of eligibility under specified
circumstances

Division 3--Licences

This Division (clauses 17­20) contains provisions:

· prescribing the manner in which applications for a licence may be made to the
council
· providing for the manner in which the Council may detemine an application
· providing that a licence remains in force until the following 30 June unless it is
sooner suspended or cancelled
· enabling the Council to suspend or cancel a licence under specified
circumstances
Division 4--Appeals

This Division (clause 21) contains a provision enabling appeals to be made against
certain decisions under the proposed Part.

PART 3--CONVEYANCING PRACTICE

This Part, containing 3 Divisions, regulates the manner in which a licensed
conveyancer may conduct conveyancing business. In particular, the Part contains
requirements concerning the keeping of and accounting for money held by a licensed
conveyancer and provides for the inspection of a licensed conveyancer's accounts and
affairs for the purpose of ensuring that these requirements are complied with.

Division 1--General

This Division (clauses 22­32) contains provisions:

· providing that contravention of the proposed Division does not generally
constitute an offence but may constitute unsatisfactory professional conduct or
professional misconduct for the purposes of the disciplinary provisions of
proposed Part 6
· establishing maximum fees that may be charged for conveyancing work and
prohibiting the charging of fees in excess of that maximum
· prohibiting the conduct of a conveyancing business otherwise than by sole
practitioners and partnerships
· requiring a licensed conveyancer to be in reasonable attendance at his or her
business premises while those premises are open for business
· prohibiting a licensed conveyancer from conducting a conveyancing business
under a business name that has not been approved by the Committee
· prohibiting a licensed conveyancer from sharing the receipts of a conveyancing
business with persons who are not licensed conveyancers unless the permission
of the Committee has been obtained
· prohibiting a licensed conveyancer from employing disqualified persons and
prohibiting disqualified persons from seeking employment with a licensed
conveyancer
· prohibiting a licensed conveyancer from sharing staff with a legal practitioner or
real estate agent

· prohibiting a licensed conveyancer from advertising otherwise than in
accordance with the regulations under the proposed Act
· prohibiting a licensed conveyancer from being involved in the conduct of any
other business unless that business has been approved by the Committee
· enabling the Committee to establish guidelines for the conduct of a
conveyancing business and prohibiting a licensed conveyancer from conducting
a conveyancing business in contravention of the guidelines
Division 2--Trust money and controlled money

This Division (clauses 33­38) contains provisions:

· regulating the manner in which money received by a licensed conveyancer on
behalf of another person must be kept
· requiring a licensed conveyancer to keep proper accounts of such money
· providing for the auditing of such accounts
· requiring a proportion of trust money held by a licensed conveyancer to be paid
into the Statutory Interest Account kept by the Law Society
· providing for the disposition of unclaimed trust money
· providing that a bank in which trust money is held by a licensed conveyancer in
accordance with the proposed Division does not incur any obligation in relation
to the money that would not be incurred in relation to trust money generally
These provisions are an adaptation of similar provisions contained in the Legal
Profession Act 1987.

Division 3--Inspection of trust accounts and investigations generally

This Division (clauses 39-44) contains provisions:

· providing for the appointment of trust account inspectors and investigators
(referred to collectively as "inspectors") for the purposes of the proposed
Division
· requiring a licensed conveyancer to produce records concerning the affairs of the
licensed conveyancer when required to do so by an inspector
· requiring an inspector to report to the Law Society Council and to the Minister
on the results of an inspection or investigation carried out under the proposed
Act
· requiring a licensed conveyancer to pay the costs of an inspector's inspection or
investigation under the proposed Act
· prohibiting an inspector from disclosing information concerning the fact of, or
the results of, an inspection or investigation carried out under the proposed Act
· prohibiting the hindrance or obstruction of an inspector in the exercise of the
inspector's functions
These provisions are an adaptation of similar provisions contained in the Legal
Profession Act 1987.

PART 4--CLAIMS ARISING FROM FAILURES TO ACCOUNT

This Part, containing 3 Divisions, provides that the Association of Property
Conveyancers ("the Association") is liable for pecuniary losses suffered as a result of
failures to account by licensed conveyancers and provides further for the making of
claims against the Association with respect to such losses and the indemnification of the
Association against such claims by an appropriate policy of fidelity insurance.

These provisions are an adaptation of similar provisions contained in the Legal
Profession Act 1987.

Division l--Preliminary

This Division (clauses 45 and 46) defines certain words and expressions for the
purposes of the proposed Part.

Division 2--Fidelity insurance

This Division (clauses 47 and 48) requires the Association to take out fidelity
insurance with respect to all licensed conveyancers and enables the Association to levy
licensed conveyancers for contributions to the payment of the insurance. premiums.

Division 3--Claims against the Association in respect of failures to account
This Division (clauses 49-58) contains provisions:

· enabling persons who have suffered pecuniary loss as a result of a licensed
conveyancer's failure to account to seek compensation from the Association
· enabling licensed conveyancers to be reimbursed for claims made against them
as a result of the actions of their associates
· enabling the Association to fix a final date for the making of claims with respect
to any particular failure to account
· requiring claims to be pursued
· providing for the determination of claims by the Association
· providing for the avoidance of double compensation
· enabling the Association to place a limit on the aggregate claims that can be
made in respect of any single licensed conveyancer or firm of licensed
conveyancers
· restricting the taking of proceedings against the Association in respect of the
Association's determination of a claim
· providing that the Association is subrogated to the rights of a claimant once the
claim has been paid
· allowing for the proportional settlement of claims in the event that the
Association's assets are inadequate to pay all claims in full
PART 5--MANAGEMENT AND RECEIVERSHIP

This Part, containing 3 Divisions, provides for the appointment of managers and
receivers to a licensed conveyancer's conveyancing business.

These provisions are an adaptation of similar provisions contained in the Legal
Profession Act 1987.

Division 1--Preliminary

This Division (clauses 59­61) defines certain words and expressions for the purposes
of the proposed Part.

Division 2--Management

This Division (clauses 62­73) contains provisions:

· enabling the Council, with the consent of the Committee, to appoint a manager
to a licensed conveyancer's conveyancing business under certain circumstances
· specifying that only a licensed conveyancer or a practising solicitor is qualified
to be appointed as a manager
· conferring certain powers on a manager of a licensed conveyancer's
conveyancing business
· enabling a conveyancing business to continue under management even if a
receiver for the business is appointed under proposed Division 3
· providing that the acts of a manager are taken to be the acts of the licensed
conveyancer
· providing for the reimbursement of a manager for damages and costs recovered
against the manager in relation to matters arising from the management of a
licensed conveyancer's conveyancing business
· providing for the payment of the expenses of the management of a licensed
conveyancer's conveyancing business
· requiring a manager to report to the Council and to the Association on the
management of a licensed conveyancer's conveyancing business
· requiring the manager of a licensed conveyancer's conveyancing business to
comply with the requirements of the proposed Act in relation to trust accounts
· enabling the regulations to control the manner in which the manager of a
licensed conveyancer's conveyancing business is to keep office accounts in
relation to the business
· providing for the transfer back to the relevant licensed conveyancer of a
conveyancing business that has ceased to be under management
· prohibiting the hindrance or obstruction of a manager in the exercise of the
manager's functions
Division 3--Receivership

This Division (clauses 74­100) contains provisions:

· enabling the Supreme Court to appoint a receiver of a licensed conveyancer's
property on the application of the Law Society
· allowing a receivership to extend to the property of a licensed conveyancer's
associate

· requiring the court to be closed to the public when the application for the
appointment is being heard
· requiring a copy of the order of appointment of a receiver to be served on the
licensed conveyancer concerned and on any other person on whom the Supreme
Court requires such a copy to be served
· empowering a receiver to take possession of any receivable property of the
relevant licensed conveyancer
· requiring persons to furnish a receiver with information concerning the
receivable property of a licensed conveyancer
· enabling the receiver of a licensed conveyancer's property to prohibit
transactions on bank accounts containing money that the receiver believes to be
receivable property
· prohibiting persons, from unlawfully dealing with receivable property
· empowering a receiver to recover compensation from persons who have received
receivable property that has been unlawfully disposed of
· enabling the receiver of a licensed conveyancer's property to give certain
certificates in relation to property dealt with by the receiver
· providing that the receiver of a licensed conveyancer's property is taken to be
beneficially entitled to the property
· empowering the receiver of a licensed conveyancer's property to deal with
receivable property in any way in which the licensed conveyancer could have
dealt with the property
· conferring other miscellaneous powers on a receiver
· enabling the receiver of a licensed conveyancer's property to fix a time limit of
not less than 1 month within which claims against the property are to be made to
the receiver
· requiring a licensed conveyancer to notify the receiver of the licensed
conveyancer's property of any lien claimed by the licensed conveyancer
· enabling the receiver of a licensed conveyancer's property to seek an order from
the Supreme Court empowering the receiver to conduct an examination of the
licensed conveyancer or any other person in relation to receivable property
· providing for the disposal of receivable property that is not otherwise dealt with
by the receiver of a licensed conveyancer's property
· providing for the investment of receivable property in the hands of the receiver
of a licensed conveyancer's property
· providing for the reimbursement of the receiver of a licensed conveyancer's
property for damages and costs recovered against the receiver in relation to
matters arising from the receivership
· providing for the payment of the expenses of the receivership of a licensed
conveyancer's property
· providing for the review by the Supreme Court of the expenses of the
receivership
· ensuring that receivable property is not capable of being attached for payment of
any judgment debt

· enabling a receiver to apply to the Supreme Court for directions as to how the
receiver should exercise his or her functions under the receivership
· enabling the Supreme Court to give general directions as to how a receiver
should exercise his or her functions under the receivership
· requiring a receiver to submit periodic reports to the Supreme Court and to the
Council and the Association
· providing for the termination of a receivership and for the appointment of a new
receiver and the transfer of receivable property out of the hands of a former
receiver
· prohibiting the hindrance or obstruction of a receiver in the exercise of the
receiver's functions
PART 6--DISCIPLINARY PROCEEDINGS

This Part, containing 7 divisions, provides for the action to be taken against a
licensed conveyancer who is alleged to be guilty of unsatisfactory professional conduct
or professional misconduct.

These provisions are an adaptation of similar provisions contained in the Legal
Profession Act 1987.

Division 1--Preliminary

This Division (clauses 101­105) contains provisions:

· applying the provisions of proposed Part 6 to former licensed conveyancers
· ensuring that conduct does not cease to be unsatisfactory conduct or professional
misconduct merely because it happens also to constitute an offence
· providing for the appointment of licensed conveyancer members to the Legal
Profession Conduct Review Panel ("the Panel") for the purposes of proceedings
under the proposed Part
· providing for the appointment of licensed conveyancer members to the Legal
Profession Standards Board ("the Board") for the purposes of proceedings under
the proposed Part
· providing for the appointment of licensed conveyancer members to the Legal
Profession Disciplinary Tribunal ("the Tribunal") for the purposes of
proceedings under the proposed Part
Division 2--Complaints against licensees

This Division (clauses 106­112) contains provisions:

· providing for the making of complaints to the Council with respect to the
conduct of licensed conveyancers
· enabling the Council to require a complainant to furnish further particulars in
relation to a complaint
· enabling the Council to dismiss a complaint summarily where it is clear that the
complaint is frivolous or vexatious
· requiring the Council to investigate all other Complaints

· requiring the Council to consult with the Committee before making a decision
with respect to a complaint
· specifying the decisions that the Council may make with respect to a complaint
· enabling the Council to make a complaint after consultation with the Committee
Division 3--Review of the Council's decisions

This Division (clauses 113­17) contains provisions:

· enabling a dissatisfied complainant to seek a review of the Council's decision
with respect to a complaint
· defining the composition of the Panel for the purposes of the conduct of a review
· prescribing the manner in which a review is to be conducted by the Panel
· enabling the Panel to recommend what further action should be taken in relation
to the complaint under review
· authorising the Attorney General to act on the recommendation of the Panel
Division 4--Unsatisfactory professional conduct

This Division (clauses 118-­125) contains provisions:

· defining the composition of the Board for the purposes of the conduct of a
complaint that has been referred to it
· prescribing the manner in which a hearing is to be conducted by the Board
· specifying which persons are to be taken to be parties in relation to the
proceedings on a complaint
· requiring hearings to be conducted in the absence of the public
· enabling the Board to summon witnesses and to take evidence
· enabling the Board to compel the production of documents
· enabling the Board to prohibit the release of information concerning proceedings
before it
· specifying the action that the Board may take in determining proceedings before
it
Division 5--Review of the Board's decisions

This Division (clauses 126­131) contains provisions:

· enabling applications to be made against the determination of the Board with
respect to proceedings under proposed Division 4
· defining the composition of the Tribunal for the purposes of the hearing of an
application for review that has been made to it
· specifying which persons are to be taken to be parties in relation to the
proceedings on a complaint
· prescribing the manner m which a review is to be conducted by the Tribunal
· specifying the action that the Tribunal may take in determining proceedings
before it

· enabling the Tribunal to deal with a complaint as if it related to professional
misconduct
Division 6--Professional misconduct

This Division (clauses 132­140) contains provisions:

· defining the composition of the Tribunal for the purposes of the hearing of a
complaint that has been referred to it
· prescribing the manner in which a hearing is to be conducted by the Tribunal
· specifying which persons are to be taken to be parties in relation to the
proceedings on a complaint
· requiring hearings to be conducted in the presence of the public
· enabling the Tribunal to summon witnesses and to take evidence
· enabling the Tribunal to compel the production of documents
· enabling the Tribunal to prohibit the release of information concerning
proceedings before it
· specifying the action that the Tribunal may take in determining proceedings
before it
· providing for an appeal to the Supreme Court against a decision of the Tribunal
under the proposed Division
Division 7--Miscellaneous

This Division (clauses 141­145) contains provisions:

· providing for the enforcement of orders of the Board and the Tribunal
· providing for the payment of fines and costs to the Prothonotary of the Supreme
Court for payment into the Statutory Interest Account
· providing for the payment of the costs of administering the proposed Part
· requiring the Council to submit periodic reports to the Attorney General on
complaints dealt with by it under the proposed Part
· excluding the members and Registrars of the Council, the Committee, the Panel,
the Board and the Tribunal from personal liability for acts done in good faith for
the purpose of executing the proposed Part
PART 7--THE CONVEYANCERS LICENSING COMMITTEE

This Part (clauses 146­152) deals with the constitution and functions of the
Conveyancers Licensing Committee and contains provisions:

· constituting the Committee as a corporation that is not to represent the Crown or
to be under the control or direction of the Minister
· defining the membership of the Committee
· specifying the functions of the Committee
· establishing an education subcommittee of the Committee and defining its
membership and functions

· establishing an insurance subcommittee of the Committee and defining its,
membership and functions
· enabling the Committee to establish other advisory sub-committees
· providing for the appointment of a Registrar and other staff for the Committee,
the use by the Committee of the services of Government staff and facilities and
the employment by the Committee of consultants
PART 8--MISCELLANEOUS

This Part (clauses 153­162) deals with the miscellaneous matters and contains
provisions:

requiring the Committee and the Association to submit annual reports to the
Minister for tabling in Parliament
conferring certain functions on the Council in connection with the administration.

of the proposed Act
enabling the Supreme Court to order the delivery up of documents
providing for the qualifications of auditors for the purposes of the proposed Act
providing for the establishment of a register of licensed conveyancers
providing for the issue of evidentiary certificates concerning the persons who are
licensed conveyancers and the terms of the licences in force under the Act
providing that offences against the proposed Act or the regulations are to be
dealt with summarily before a Local Court constituted by a Magistrate
enabling the Governor to make regulations for the purposes of the proposed Act
giving effect to a Schedule of amendments to other Acts
giving effect to a Schedule of savings, transitional and other provisions
SCHEDULE l--THE CONVEYANCERS LICENSING COMMITTEE

This Schedule provides for the membership and procedure of the Committee.

Part 1 (Members of the Committee) contains provisions concerning:

· reserve members
· terms of office
· remuneration
· filling of vacancy in office of a member
· casual vacancies
· conflict of interests
· effect of certain other Acts
Part 2 (Procedure of the Committee) contains provisions concerning:

general procedure
quorum
presiding member
voting
minutes
first meeting

SCHEDULE 2--AMENDMENT OF OTHER ACTS

This Schedule amends the following Acts:

· Auctioneers and Agents Act 1941
· Conveyancing Act 1919
· Land Sales Act 1964
· Legal Profession Act 1987
· Real Property Act 1900
SCHEDULE 3--SAVINGS, TRANSITIONAL AND OTHER PROVISIONS

This Schedule contains savings, transitional and other provisions.

Part 1 (Preliminary) contains a provision enabling the regulations to include
provisions of a savings or transitional nature.

Part 2 (Provisions consequent on enactment of the proposed Act) contains provisions
concerning:

· a definition
· interim constitution of the Committee
· interim constitution of the Panel
· interim constitution of the Board
· interim constitution of the Tribunal
· interim certificates of eligibility
DICTIONARY OF WORDS AND EXPRESSIONS

The Dictionary defines the following words and expressions:

affairs
Law Society
Association
licence
Board
licensee
committee
money
controlled money
money received
conveyancing business
Panel
conveyancing work
professional misconduct
costs
record
Council
Statutory Interest Account
disqualified person
Tribunal
exercise a function
trust money
firm of licensees
unsatisfactory professional conduct
function

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