Solicitors vs Conveyancers

From: Owen .


Just wondering who most of my fellow investors use when it comes to doing the property conveyancing on their new IP's?

My understanding is if a contract is checked and anything goes wrong with the purchase process that caused by some clause in the contract, a solicitor can be held liable whereas a conveyancer cannot. Is this correct?

The reason I ask is conveyancers can be considerably cheaper that a solicitor for simple conveyancing work. A solicitor is a must for any "creative" contract work though.
 
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Reply: 1
From: Apprentice Millionaire


Hi Owen,

I would not know if a solicitor is held liable in case something went wrong, and I would appreciate the opinion of others on this forum. However, I can tell you that in my current situation, where I purchased a new property in Victoria with a builders warranty insurance policy issued by HIH, I was glad I had my solicitor! She added special conditions to the contract. Interestingly, the vendors used a conveyancer, and they were at a loss with what to do in this situation. My solicitor had them eating out of her hand!

Cheers
Apprentice Millionaire
(aka Jacques)
 
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Reply: 2
From: Terry Avery


solicitors belong to an association that you can complain to (Solicitor's
Board). If your solicitor stuffs up you have someone to complain to without
going to court. If that doesn't resolve it you then go to court.

A conveyancer is just as liable for negligence as a solicitor but you have
to sue (go to court) for damages as there is no professional body to
complain to.
 
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Reply: 2.1
From: Owen .


Thanks for that Mr Avery (Tex?). I figured it was something like that.

Can a conveyancer add clauses to a contract or does that have to be a solicitor? Following on from that, can I add a clause to a contract? I'm thinking that once I have the kinds of clauses I am happy with I can add the ones that relevant to the deal at the time without having to involve a solicitor. Then when it is accepted I can get the conveyancing done.

Is this feasible or am I kidding myself and heading for all sorts of problems? What do other do with regards to lots of transactions?
 
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Reply: 2.1.1
From: Damien Dupont


Hi Owen,

I am not a solicitor but I can see no reason why you couldn’t construct and include your own clauses into a contract as long as you knew the relevant legislation (i.e. you knew what you were doing and weren’t including something contrary to statute).

Whilst we’re on this topic, a question to the wider forum:

John Burley speaks of the necessity of purchasing "Title Insurance" in the U.S. to protect against any liens the conveyancer / solicitor may have missed. I’ve never heard of this in Aus., but does this exist at all in Australia? If not, can anyone explain as to why it appears worthwhile and necessary in the U.S., but not necessary in Australia?

Thanks,

Damien
 
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Reply: 2.1.1.1
From: Paul Zagoridis


Always get a skilled professional involved in your coveyancing and especially with contracts for sale. They are up on the latest decisions and understand sneaky lawyer-speak like "time is of the essence". That cryptic bit of twaddle basically means that they'll keep your deposit in two weeks.

What is your time worth? By all means instruct them in what clauses you want. Also remember there is a lawyer on the other side. They work better when they talk to one of their own. My lawyer often complains to his learned colleague that I am quite unreasonable and insist on these conditions.

Title insurance in USA is part of their conveyancing system. We cover it with searches and professional indemnity insurance. Your lawyer/conveyancer effectively issues your title insurance.

Dreamspinner
 
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Reply: 2.1.1.1.1
From: Damien Dupont


Hi Paul,

Thanks for the reply.

It seems as though our system is nowhere near as weatherproof though.

Your conveyancer could close down his $2 company two months after your deal, and you only later find out about an outstanding lien? Where would this leave the purchaser? Conversely, your solicitor may retire and close his practice?

Anyway, I haven’t heard of any such nasty experiences from anyone on this forum as yet, so I expect such an occurrence would be fairly rare. Still think the U.S. model is probably safer though (albeit still with some element of risk - your insurer could always go bust !!).

Damien
 
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Reply: 2.1.1.1.1.1
From: Paul Zagoridis


Actually I believe our system is quite a bit more secure efficient and streamlined than the US.

I've bought property in Qld, NSW and Vic so I can't speak for other states.

The Land titles office in every state is a Government body. Solicitors and conveyances carry professional indemnity insurance and law society in conjunction with State Government insure trust accounts.

Sure getting lawyers to do simultaneous closes etc. is tricky but not impossible. Listen to those US tapes again, especially where it's being explained to the slow learners that you might have to look around to find a title officer to work with you.

The incidence of malpractice in conveyancing is slight. That was why conveyancers broke the lawyers monopoly. It's not a high skill area of law.

Dreamspinner
 
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Reply: 2.1.1.1.1.1.1
From: Owen .


Thanks to those who replied. Time for some interviews I think.
 
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