Technology and Law
Article Written by Matthew Stewart,
Partner in our Property department.
Cryptocurrency is very much in the news and most of us are aware of its massive fluctuations in value. But is it the future?
A property was recently purchased for £350,000.00 using Bitcoins and a multi-million- pound property has been listed for Bitcoin purchase only.
Lenders are receiving enquiries on the use of cryptocurrency as full or part payment for property transactions such as deposits or holding deposits.
There are obvious dangers, the main perhaps being the volatility in the value of the Bitcoin. Money laundering and criminal proceeds are other major concerns. There are also the practicalities of how to deal with things when they go wrong – your crypto currency, unlike other savings and investments, are not protected and do not have the benefit of the government-backed guarantee of £80,000.00.
Also, how does one sue for breach of contract and in which jurisdiction? With whom are you transacting? From where have their funds coming? How do you determine the dirty from the clean?
Banks are beginning to take cryptocurrencies seriously and sooner or later it will be more regulated and presumably safer to use. It is likely that we will be using cryptocurrency for transactions but it is even more likely that the blockchain technology behind cryptocurrencies will be utilised to improve property transactions.
Land Registry and eConveyancing
There have already been attempts to introduce eConveyancing: HM Land Registry’s Chain Matrix and the Law Society’s costly failure, Veyo. These were multi-million-pound lead balloons, however, there was nothing at all wrong with the concepts because in one shape or another, eConveyancing will happen.
Australia has implemented theirs – PEXA (Property Exchange Australia). Similar to the Land Registry’s Chain Matrix concept funds are transferred and registration takes place simultaneously.
One can already certify one’s identity using the government’s website GOV.UK Verify. The Land Registry intends to allow mortgage deeds to be signed electronically; however some lenders may take objection to this. ‘Sign Your Mortgage Deed’ will apply to remortgage transactions where ID can be verified and mortgage deeds signed electronically using GOV.UK Verify.
The use of eSignatures will become more popular and comply with UK law (the European Union Regulation No 910/2014 on electronic identification and trust services). However, they are not yet accepted for conveyancing contracts and transfer deeds but other forms can be electronically signed.
The Land Registry will introduce a new service ‘Find Property Information’ which anyone can access. The information available will include the property address, title number, owner’s name and address and what they paid for the property.
It’s the driverless car of the property world. It will happen but may take some time to implement. Conveyancing and other areas of law are full of administrative tasks, most of which should not really be carried out by a fully qualified solicitor. Clients pay for legal advice and if the lawyer is free from the shackles of administration then more time can be spent on providing advice whilst the technology will ensure that matters run smoothly in the background.
Change is inevitable and we must embrace it.
Should you require any advice or assistance regarding this article or any other aspect of property law please contact Matthew Stewart at Matthew.Stewart@dwfmbeckman.com or by telephone 020 7408 8888.