At a meeting of the Oireachtas Committee on Justice earlier this month, members were told that six in every 10 auctioneers were experiencing delays in conveyancing. A survey involving more than 200 members of the Institute of Professional Auctioneers and Valuers (IPAV), presented to the committee, has found that the average delay from sale agreed to close of sale was almost 4½ months.

Almost 70 per cent of those surveyed attributed delays to an unwillingness by solicitors to do business via email or telephone, preferring instead to use the traditional method of letter writing.

IPAV, which represents almost 1,000 auctioneers, said the results of its study contrasted with the findings of a similar survey by the European Council of Real Estate Professions, which found lawyers conducted much of their business via email and telephone.

"The major reason for such delays was solicitors' conveyancing procedures and these were identified as a reason by an overwhelming 79 per cent of respondents," says IPAV president Keith Anderson. The result of such delays, according to the institute, is that 68 per cent of auctioneers have lost sales and 27 per cent have seen banks withdrawing finance.

“Purchasers and sellers are coming back to us week after week frustrated with a lack of progress after the sale is agreed,” Anderson says.

The institute was concerned that with banks increasingly offloading more properties, the situation was likely to get worse. It called on the committee to speed up the implementation of electronic conveyancing.

Moves are afoot on that front. Last December, the Law Society, which represents solicitors, announced it was launching a project that will move the entire system of property conveyancing in Ireland to an automated and electronic platform ,with an implementation target date of December 2017.

The recovery in the Irish property market has boosted the fortunes of the legal sector with property, construction and conveyancing – as well as pent-up demand for residential and commercial property – the key areas driving growth.

The average transaction time is 22 weeks but the society said the e-conveyancing model towards which it had been working could reduce that to five working days, where the buyer had the funds available.

Radical overhaul

As far back as 2008, the Law Society proposed a radical overhaul of existing conveyancing methods to simplify and speed up the legal verification of property transactions.

The implementation phase of the e-conveyancing project has begun, with the project team now in place and working with all stakeholders to introduce e-conveyancing, a spokeswoman for the society said.

When e-conveyancing is implemented, solicitors on both sides of a property transaction will exchange information and documents in a paperless way via a secure central hub. The hub will provide a secure central work area to allow solicitors and lenders to view information, exchange data and communicate information in real time in order to complete property transactions in a fraction of the time it currently takes.

Home-buyers will see transaction times reduced to as little as five working days, reducing costs while increasing transparency and security.

Solicitor David Reilly says solicitors are embracing technology. He founded technology company solvemylegal.com in 2013 to offer consumers transparency when it comes to legal fees in areas such as conveyancing.

“I designed the software to allow businesses and consumers to source solicitors online and at no charge to them,” Reilly adds. “They can find the right solicitor quickly and easily and anonymously and they will also receive in a quote from solicitors who use the service.”

He says solicitors are happy to use such technology in their law firms and be upfront on fees and charges. The solicitors are not openly bidding with each other on the site and all communication is done privately.

The solicitors are charged a flat fee to be included, while those searching on the site – whether businesses or individuals – can do so for free. He says the site is “crossing the Rubicon” when it comes to legal fees and transparency as people can go online and get a number of quotes for conveyancing legal fees or whatever legal service they require.

Time-consuming

Solicitor Sonia McEntee, who serves on the Law Society’s e-conveyancing taskforce, says that while technology will help and solicitors were willing to embrace technology, selling a house could be a time-consuming process.

“It’s mainly about technology but the same title issues are still going to arise. Owners want to ensure they get the correct titles for the property and that planning permission is in order,” she says.

Delays could also occur with payment systems, she adds, and e-conveyancing would use electronic funds transfer to speed up the process.

“There’s still one bank that issues mortgage cheques and if you’re mortgaging with that bank, you have to allow your mortgage cheque five working days to clear before you can close your transaction which is another unnecessary delay.

“When e-conveyancing is up and running, a vendor will be able to go to their solicitor when they agree to sell their property and the solicitor will be able to access a secure online platform and communicate directly with the bank and request the title deeds,” McEntee says. “That request will go instantly to the banks who should then be able to release the deeds almost immediately.”

She adds that apart from technology, other issues could slow down the house selling process. “For example, if I’m buying a property for a client I have to look for certificates of compliance and planning that go back to 1935. That can be cumbersome and time consuming.”

McEntee says there is a project under way for solicitors to work with the Government and local authorities to agree a planning amnesty in relation to older properties.

“If a property was built in 1980, do we really need to have an architect’s certificate of compliance that says in 1980, this property was constructed with planning permission?”

Move to e-conveyancing

John Lane

, managing partner at Holohan Law in Cork, says he is a firm believer of in the move to e-conveyancing on the basis that “the more paper you can get rid of the better”.

He says: “The key players are the vendors solicitor, the purchaser’s solicitor, the vendor, the purchaser, the revenue commissioners for stamp duty and the land registry for registration. If you have all of them operating from the one platform and they can all access it, you can speed up the process and knock weeks of the time of transaction.”

Lane agrees with McEntee that while e-conveyancing will speed up the system, the same issues with titles will arise. “Solicitors will still have to check titles to make sure they are in order and check planning permission. If you don’t check the title properly and it later transpires there was something wrong with it, the bank can sue the solicitor for the dodgy title.”

Lane adds that solicitors are trying to be as competitive and consumer-friendly as possible but they are being tied up with issues regarding unpaid local property tax and the non-principal private residency charge, which weren’t legal issues at all.

“Years ago, when the local authorities were in charge of refuse collection, if the refuse collection wasn’t paid they could theoretically be in charge of the property and could leave it until the house was being sold to collect arrears against the property. Something similar happens with LPT and NPPR. If it’s not dealt with or paid for, it becomes a charge on the property and the title of the house is then said to be encumbered.”