Conveyancing is the legal procedure for transferring real property from one owner to another. Real property is property that cannot be moved, such as land and buildings, as distinct from personal property. Conveyancing involves both a contract to transfer the property and proof of the title (right to possess the property). In countries where the legal profession is divided into barristers and solicitors, solicitors normally carry out conveyancing. Some countries allow people who are not lawyers to qualify as conveyancers, and buyers or sellers may carry out their own conveyancing if they wish.
The first stage in buying property is for the buyer and the seller to agree on a price. This preliminary agreement is often stated to be subject to contract, which means that either party can drop the purchase at any time. The buyer may pay a small deposit on the price.
The seller prepares the contract. Before signing the contract, the buyer should carry out a thorough inspection of the property and may employ a surveyor to do this. The buyer may question the seller about boundaries to the property, restrictions on the land, or easements (the right to use the land to gain access to another property). If the seller knowingly gives the buyer incorrect information, the buyer may be able to rescind (cancel) the contract.
The description of the property given in the contract will be used in the conveyance, so it is important that the property is described correctly at this stage. Usually, the buyer pays a deposit when the contract is signed. The buyer forfeits the deposit if he or she prevents completion of the sale. If the sale is by auction, the bid is the offer and the fall of the auctioneer’s hammer is the acceptance.
After signing the contract, the seller prepares the abstract of title and delivers it to the buyer, according to the contract. The abstract is a summary of the documents showing the seller’s title to the property. The seller must also deliver all documents referred to in the abstract along with it. If the land is registered, no abstract is necessary because title will already have been proved and registered. A widely used system of land registration is the Torrens system. When the buyer receives the abstract, he or she prepares a draft conveyance.
After receiving the abstract, the buyer must make a number of final checks before the sale is completed. For instance, the buyer must check that no contract exists to sell the property to someone else. To carry out these checks, the buyer searches the appropriate register. In the case of registered land, an official search is made at the registry. A document called an instrument of transfer conveys registered land, and the buyer is registered as the new proprietor.
When the conveyance is agreed, the buyer engrosses it—that is, puts it into a formal document. The seller delivers a completion statement, showing the balance of payment due. The buyer pays the balance, and possession is transferred. After completion, the buyer is entitled to exercise the rights previously held by the seller, apart from any restrictions agreed in the contract.
See also Contract ; Easement ; Estate ; Torrens system .
