10 Mar 2011 Posted in Press releases
- The Ministry of Law (MinLaw) has introduced the Conveyancing (Miscellaneous Amendments) Bill in Parliament on 10 March 2011 to propose new measures to safeguard conveyancing money belonging to buyers and sellers of property. The Conveyancing (Miscellaneous Amendments) Bill makes amendments to the Conveyancing Law and Property Act and the Legal Profession Act.
- Money for the purchase or from the sale of a home makes up a substantial portion of an individual’s assets, and should be properly protected. The new measures aim to address the risk of rogue lawyers defalcating clients’ conveyancing money.
- The key features of the measures are:
- Lawyers will no longer be allowed to receive and hold conveyancing money in their normal client accounts (as is the current practice). A breach of this prohibition will result in a fine of up to $50,000 and / or an imprisonment term of up to three years.
- Lawyers will only be allowed to receive and hold conveyancing money in a new type of bank account, called a Conveyancing Account. These Conveyancing Accounts will be opened with Appointed Banks designated by the Minister for Law. Withdrawal or pay-out of money from Conveyancing Accounts will require two-party authorisation. Typically, the counter-signatory will be the lawyer representing the other party in the conveyancing transaction.
- Buyers and sellers who wish to place conveyancing money in such accounts will have to indicate the payee’s name on their cheque/cashier’s order in the format: “<Name of law firm>-CVY”. Lawyers holding on to CPF money on behalf of clients or CPF Board will be able to do so in separate Conveyancing (CPF) Accounts.
- Buyers and sellers who do not wish to deposit money with their lawyers can instead instruct their lawyers to engage the Singapore Academy of Law (SAL) to hold conveyancing money, through a newly created Conveyancing Money Service. Payment of such money via cheque/cashier’s order should be made to “ Singapore Academy of Law”.
- Alternatively, lawyers can receive and hold conveyancing money under escrow agreements between both buyers’ and sellers’ lawyers. These are more relevant for complex transactions.
- To support the measures, the Singapore Land Authority will launch a new electronic Payment Instruction (ePI) service to provide an efficient and secure environment for lawyers to initiate pay-out instructions and counter-sign digitally, as well as for Appointed Banks and SAL to securely retrieve and process instructions.
- The draft Bill that was earlier released for public consultation has been revised and has been uploaded on MinLaw’s website. Key stakeholders including the Singapore Academy of Law, Law Society and participating law firms and banks, have been consulted and their feedback has been taken into consideration in finalising the Bill.
- Key aspects of the new measures are set out in the accompanying Fact Sheet.
- Fact Sheet on proposed measures to safeguard conveyancing money (0.1MB)
- Conveyancing (Miscellaneous Amendments) Bill (0.03MB)
- Guide to legislative amendments (0.09MB)
- Response to feedback received from second public consultation on safeguarding conveyancing money
Last updated on 25 Nov 2012