As a solicitor, of course I’m going to say that someone buying or selling a property should use a solicitor (lawyer) to do their conveyancing work. But what are the reasons why I recommend this and what are the primary differences in the service provided?
The training and licensing requirements for conveyancers are different in each State, so everything I’m going to address relates to Victoria.
To be a solicitor, someone has to have a Bachelor of Laws, at a minimum, which takes the equivalent of 4 years of full time study. During that bachelor (undergraduate) degree, they will study Contract Law for 6 months, Property Law for 6 months and Land Law for 6 months. Along with all the other units of study, the Bachelor of Laws teaches law students to think as lawyers.
After completing the degree, to be able to get a practicing certificate as a solicitor, the person would need to complete a Graduate Diploma in practical legal training, which takes another 6 months. This is when they are exposed to the practical aspects of conveyancing.
Once they have a practicing certificate, solicitors are required to undertake ongoing legal training each year to be eligible to reapply for their certificate annually.
There are different levels of practicing certificate, and to be able to operate a trust account, a solicitor must pass an extra course on trust accounting regulation and compliance, and pay an auditor twice a year to audit the account. Most law firms have a trust account, but many conveyancers do not.
To be a conveyancer, someone must have a Diploma in Conveyancing, which takes the equivalent of 3 months of full time study. They then need to have a certain amount of practical hours of experience on the job to be signed off to get their own licence.
Both solicitors and licensed conveyancers must hold professional indemnity insurance, and both need to be registered with their industry body to have a licence issued to them – this is the Law Institute of Victoria and Consumer Affairs Victoria respectively.
In NSW, they were the first to deregulate conveyancing and let licensed conveyancers into the industry, taking the work off solicitors. There was a good reason for this, because solicitors in NSW charged on a percentage basis depending on the value of the property. This has never been the case in Victoria. Solicitors have generally charged a fixed fee for conveyancing, so the gauging wasn’t going on in this State. Arguably, there was no need to deregulate conveyancing in Victoria in the first place.
Solicitors cannot compete with conveyancers for cost, so what they compete on is value for money and quality of service. Conveyancers generally work for themselves, and often work from home, so they don’t have the overheads and costs that solicitors have. Solicitors have offices, staff, higher insurance, more regulations to comply with, and often operate trust accounts which require regular audits.
Solicitors do fixed fee conveyancing in Victoria, as do conveyancers. Conveyancers are generally a couple of hundred dollars cheaper.
In the Office
Conveyancers generally work from home and work alone.
Solicitors generally work in small, medium or large law firms with support staff. Quite often there are combined decades of experience, and support staff are often qualified conveyancers who didn’t want to go out on their own.
Solicitors operate trust accounts which make settlements much easier in most cases, particularly for purchasers. Instead of the purchaser running around getting bank cheques and getting them to settlement, the solicitor can ask for all the funds into their trust account, and they do all the running around for you (hence, quality of service).
When things go wrong
Conveyancers have a very narrow scope. When something usual happens, they have to refer you to a solicitor.
If the contract falls over and becomes a fight, the conveyancer will need to refer you to a solicitor.
So better to start with a solicitor that can handle everything in the first place!
Here’s more on buying and selling property.