All land transactions must be properly authorised by or on behalf of the landowner and other relevant parties. This is an essential safeguard to ensure that only bona fide (legitimate) transactions are lodged for registration.
This will typically be your client, but may also include, for example, a mortgagee if you are registering a mortgage over your client’s property. Here’s what you need to know about practitioners' certification obligations, who needs to authorise transactions, and much more.
Practitioners' certification obligations
When lodging an electronic instrument, practitioners must certify they:
- have authority to act for the party and the party has the legal capacity to give them authority, and
- hold evidence showing the truth of the above certification (regulation 7(3)(a) and (d) of the Land Transfer Regulations 2018 (the Regulations)).
Practitioners must retain that evidence and produce it if the dealing is selected for compliance review in accordance with section 30 of the Land Transfer Act 2017 (the Act).
Before making the certifications, the requirements relating to client authority and capacity set out in the Authority and Identity Requirements for E-Dealing Standard 2018 - LINZS20018 (the Standard) must be satisfied. Section 3 of the Authority and Identity Requirements for E-Dealing Guideline 2018 - LINZG20775 (the Guideline) has further guidance about how to satisfy those requirements.
Who needs to authorise the transaction?
Authority must be obtained from the landowner and every party to the transaction. For instruments under the Land Transfer Act 2017, column 5 of schedule 3 of the Regulations specifies the parties from whom authority must be obtained. You only need to obtain authority from the parties your certifications relate to.
A practitioner who is a party to the transaction and certifying on their own behalf need not hold evidence of their authority.
How to obtain authority
A signed authority and instruction form (A&I form) is the accepted method for obtaining authority. There are three types of A&I forms:
- Private Individual
- Private Corporate (e.g. a non-publicly listed company or an incorporated society)
- Public Corporate (e.g. a publicly listed company, territorial authority, or government department).
The forms are unique, so it is important to use the correct one.
The Guideline defines those entities that comprise Private Corporates and Public Corporates (see page 6). Where you are unsure, we recommend using the Private Corporate A&I form.
An A&I form typically authorises a combination of instruments in a single dealing (e.g. a discharge of mortgage and transfer). However, a single A&I form can be used to authorise a series of dealings so long as this is clear from the form.
If you are acting for both sides of a transaction, a single A&I form can be used so long as the A&I form clearly identifies the capacity in which each party is signing.
Other forms of authority can be relied on in some circumstances, for example:
- to lodge a caveat or notice of claim practitioners may rely on a letter or email from the caveator or retain a file note of the caveator’s verbal instructions, or
- when lodging a mortgage or discharge of mortgage for a bank or institutional chargeholder a signed letter of instruction from the mortgagee is suitable authority (in addition to the mortgagor’s authority).
Preparing the A&I form
The A&I form is prepared by the firm and specifies:
- the firm authorised to act on behalf of the client and lodge the dealing for registration
- the full name of the client, and
- sufficient details of the transaction and the instrument(s) so it is clear what has been authorised.
A&I forms can be created within Landonline. Once the instruments in the dealing are prepared, you can create an A&I form by selecting the A&I button on the Create Dealing screen. From there, the required A&I form can be selected and the details from the instruments will pre-populate into the A&I form. You can then edit the A&I form manually (i.e. to add the property address and base document) before you save the form to your own computer. The form cannot be saved in Landonline.
Alternatively, you can download the A&I form templates from our website (see link below) and, if needed, tailor them to suit your office templates.
Vendor A&I forms and nominations
Within the Create A&I Form screen, the Name of Other Party details is a free-text field. Click into the field and enter the full name(s) of the purchaser(s). If the agreement for sale and purchase indicates a nomination may take place, i.e. shows ‘and/or nominee’, and you are unsure who will ultimately be the purchaser, the vendor’s A&I form should include the words ‘and/or nominee’ after the purchasers’ names.
Signing the A&I form
The A&I form should be completed in its entirety before it is signed by the client.
The A&I form is signed by each client personally or by an attorney, under a properly completed power of attorney with the relevant certificate of non-revocation, in front of a suitable witness who verifies the identity of the person signing.
Sections 4 and 5 of the A&I form can be edited manually if additional signatures are required.
Instruments should not be certified and signed by the practitioner until the A&I form is signed and appropriately witnessed (or another suitable form of authority is held).
Ensure your client has the legal capacity to sign the A&I form and enter into the transaction, or that you hold the necessary orders or consents. For example:
- for private individuals – the client is not a minor or an undischarged bankrupt, or
- for private or public corporates – the client is not subject to any statutory management orders, in receivership or liquidation.
Exercise care when an A&I form is signed under a power of attorney or by a Property Manager appointed by the Family Court. Due to the nature of powers of attorney and the risk of their misuse, some authorities given under a power of attorney are considered high risk.
A&I forms for bankrupt clients
A bankrupt’s property vests in the Official Assignee (OA) at the point of adjudication. That vesting for land is effected by registration of a Transmission to the OA from the bankrupt. Note – a transfer cannot be made from the bankrupt directly to a third-party purchaser, even if that transfer purports to be from the bankrupt but signed by the OA. There must be a Transmission first.
Once title is in the name of the OA, the OA may sign a Public Corporate A&I form authorising a transfer to a third-party. If the client is an undischarged bankrupt again you must deal with the OA. The OA may decide either:
- to sign a Public Corporate A&I form directly - the A&I form should be retained as evidence together with a copy of the appointment of the OA, or
- to provide consent - the client will sign a Private Individual A&I form (modifying clause 4(c) by deleting the word “not” from the certification and the A&I form should be retained as evidence together with the consent from the OA.
Where a bankrupt is not the legal or beneficial owner of the property but is holding title as a trustee or executor the OA need not be involved. The client will sign a Private Individual A&I form modifying clause 4(c) by deleting “not” from the certification and recording the title is held as trustee or executor, for example:
“4(c) I am an undischarged bankrupt but hold title as trustee / executor”
A&I forms signed under power of attorney
When an A&I form is signed under a power of attorney:
- the practitioner should make further enquiries as to the veracity of the power of attorney in situations where the practitioner has not previously acted for the client or the attorney
- the power of attorney must be clear in terms of the powers conferred on the attorney and the attorney’s authority to act in relation to the specific transaction
- the appropriate form of certificate of non-revocation of power of attorney (dated the same date or later than the power of attorney) must be retained as evidence with the A&I form, particularly in the case of an enduring power of attorney or a power of attorney given by trustees
- if the power of attorney is deposited with Toitū Te Whenua, the certificate of non-revocation must refer to the instrument number of the power of attorney
- if the power of attorney is not deposited with Toitū Te Whenua, a copy of the power of attorney must be retained on file as evidence with the A&I form, and
- the identity of the attorney must be verified as if the attorney were the client.
A power of attorney for a company must be given by the company under s181 of the Companies Act 1993. It must not be given by the directors of the company personally.
A trustee may delegate, by power of attorney, all or any of the trustee’s powers or functions under s70 of the Trusts Act 2019 when they are outside of New Zealand, temporarily unable to be contacted or temporarily incapacitated. By contrast, an attorney appointed under an enduring power of attorney in relation to property represents the donor in their personal capacity only and does not have powers to act in a trustee capacity. An enduring power of attorney can only be used to remove a trustee in the limited circumstances described in s92(1)(c) of the Trusts Act 2019.
Property Law Section Guidelines
Part 6 of the PLS Guidelines provides further guidance on the completion of A&I forms (see “K”), format of A&I forms (see “M”), execution of A&I forms by attorney (see “N”), capacity (see “O”), retention of authorities (see “P”) and more.
When do I need an A&I form?
The Instruments page details the instruments that require an A&I form (or alternatively some other form of authority as specified in the Certification of Electronic Instruments (Statutory Requirements and Retention of Evidence) Standard 2018 - LINZS20012).
Do A&I forms expire?
A signed A&I form does not expire and there is no limitation on how long you can rely on the A&I form. In clause 4 of the A&I form, the client irrevocably authorises and instructs the practitioner or their firm to register the instruments as an e-dealing.
However, regardless of whether a client has signed an A&I form (or some other form of authority) the practitioner should always consider whether the client’s authority is still valid at the time they come to certify the related instrument. It is up to the practitioner to determine whether it is still appropriate to certify that they have authority considering the client’s original instructions and any relevant issues or change in circumstances since the A&I form was signed, or whether it is better to have the client sign a new A&I form.
What to do if you have submitted an e-dealing without first obtaining a signed A&I form, or misplaced an A&I form
Obtain a signed (replacement) A&I form as soon as possible.
Failure to hold evidence of your authority or retain evidence for the prescribed 10-year period (reg 7(6) of the Regulations) is a serious matter that could result in the revocation of a practitioner’s authority to certify instruments under s29 of the Act.
How do I get an A&I form signed if I am unable to meet my client in person due to COVID-19 restrictions?
We have published guidance to support the profession when they are unable to meet their clients in person due to COVID-19 restrictions.