Landwrap August 2014 - Issue 111

Issue 111

Auto-save (file recovery)

New 'Recovery file' functionality has been introduced in Layout Plan Sheets and can be found under 'Plan Generation Preferences'. This functionality is enabled by default, and helps prevent loss of data when a user is disconnected from Landonline without warning.

When the functionality is enabled, a new 'recovery' file is automatically generated at the pre-selected time interval. The 'recovery' file is a 'snapshot' in time, retaining only those edits made from the time of the last 'Save'.

If your Plan Generation session is exited normally, a full Save is completed and then the recovery file is deleted.

If your session exits abnormally (e.g. system crash or time-out) the undeleted 'recovery' file will be offered to you when you re-open the plan (as shown immediately below), provided you have not done any other edits in Plan Gen before re-entering Layout Sheets.

Please do not accept 'Yes' or 'No' without carefully reading this message. If you select 'No' the recovery file will be deleted and your last manually saved data will be loaded, however if you select 'Yes', the content of the recovery file will be loaded and the following message will appear:

You now have the option to view your layout sheets to make sure that the recovered file contains the changes you had been working on prior to your session being interrupted. After viewing the layout sheets you can then decide whether to accept the recovery file by implementing a Save [Ctrl+S] or reject it, by cancelling out of Layout Sheets. There is no option to undo either of these choices so please choose carefully.

There have been instances where the offered recovery file is older than the saved file. This has been corrected via a systems upgrade effective 18th of August.

The recovery file option was chosen (in preference to an auto save direct to the database) for performance reasons. The process of auto-saving to a recovery file is very fast and should have no noticeable impact on performance, however there is also the option of setting it to 'disabled' if lag becomes noticeable.
Be aware that the new Auto-save (file recovery) functionality is not a substitute for regularly, initiating a full Save [Ctrl+S].

For further information refer to Plan Generation Update (//www.linz.govt.nz/news/2013-10/landonline-survey-plan-generation-update) .

Joint Lawyers and Surveyors Workshop

A cross-industry workshop has identified points in the subdivision process where there are benefits to be gained in having lawyers and surveyors engage and work together more closely.
Facilitated by the NZLS Property Law Section, the NZ Institute of Surveyors and Land Information NZ, the workshop was held in Auckland on 22 July. Over three hours, groups of lawyers and surveyors reviewed three sets of plans and titles and discussed the many issues arising. Some of the touch points identified by the groups were:

• Resource consent conditions: Both professionals should review the conditions of a resource consent. Both can assist with negotiating the terms of a consent with the Council. In the example considered, the groups thought that the wording of the Consent Notice could have been negotiated with the Council.
• Amalgamation conditions: Amalgamation conditions should be considered by both professions early on. There can be legal impediments to satisfying an amalgamation condition that takes time to resolve, for example, the land must be in common ownership and if mortgaged, be mortgaged to the same lender.
• Land to vest: When land vests as road or reserve, or becomes a common marine and coastal area, interest holders in that land must consent (or provide discharges/surrenders for the common marine and coastal area). The process of obtaining consents/surrenders should happen as early as possible to ensure all are obtained in time to apply for new titles without delay.
• Access lots: Access lots can trigger unintended legal requirements under the Securities Act 1978. This can be avoided by carefully designing the subdivision at the outset. This is an area where lawyers and surveyors should operate together very early in the process.
• Obsolete memorials: Reviewing the head title at the outset can add value – particularly if there are obsolete memorials that LINZ will facilitate removal of when the new titles are issued.
• Future proofing: Future-proofing land for subdivision (eg putting in place easements that will make future subdivision easier): talking early ensures all parties are fully informed of the client’s long term goals.
• Existing easements and covenants: Reviewing existing easements and covenants to determine what should remain and what should be surrendered. This should happen early to give the solicitor time to obtain surrenders and consents or to determine that the process to surrender an interest will be too difficult and therefore the interest should be retained on the survey plan.
• Easement descriptors: The professionals should discuss and agree the labels applied to easements early on. Ideally, descriptors from the Land Transfer Regulations 2002 should be applied, although non-standard descriptors can be developed for easements not included in the Regulations.
• Unit title developments and easements: Unit title developments require careful consideration of existing easements (how they will impact units and common property) and boundary positions. The position of unit and common property boundaries can have significant implications for maintenance obligations, which can flow through to the body corporate rules. The professionals should discuss and agree on these issues at the outset of the development.
• Stage plans to match the proposed plan: Stage unit plans must follow the proposed unit development plan (PUD). Any variance may trigger a redevelopment and/or a substituted proposed unit development plan (SPUD). If a redevelopment or a change to the PUD is intended, the lawyer should be informed as soon as possible in order to arrange various documents required by the Unit Titles Act 2010 authorised by the Body Corporate.
• Body corporate rules & utility interests: Mixed use unit title developments will likely trigger a need to adjust utility interests and the body corporate rules. It is important that the solicitor is advised of this early on in order to arrange both.
• Pre-allocated titles: An issue that was not discussed but is another area for collaboration is pre-allocated titles. When the surveyor creates a survey plan in Landonline, he or she may also allocate new title references to the new parcels. This is an appropriate point to inform the solicitor of the pre-allocated titles (ie as soon as they are created).The solicitor will use the pre-allocated titles to prepare edealing instruments. If the pre- allocated titles are reviewed by both parties (and the client early), they can be changed before the plan is approved by LINZ.

Overall, feedback from the participants showed the workshop was well received. Depending on demand, LINZ, the Property Law Section and the NZIS are keen to run more workshops in other centres in the future.

Setting up an e-dealing affecting cross leases

Cross lease transactions can be complex and special care should be taken when setting up these types of dealings. This is necessary to ensure the right certifications display appropriately for each lessor and/or lessee.

When creating an instrument that affects cross leases (eg a Variation of Lease, Surrender of Lease) you need to ensure;

• All titles for the shares in the fee simple are included in the 'Create dealing' screen for the instrument
• If a different Conveyancing Professional (CP) is acting for the different parties, that multiple CP’s are set up in the roles section of the ‘Create dealing’ screen

For example:

If there are two composite titles:

• Title 1 for a ½ share in the fee simple and the lease of Flat 1   Title 2 for a ½ share in the fee simple and the lease of Flat 2
• And a variation of lease was created affecting the lease for Flat 1, the owners of the fee simple estates (eg the owners of Title 1 & Title 2) would both need to be recorded as lessors.

When setting up the dealing, if they have different CP's you will need to create multiple roles for the lessor by changing the "No of CP's" field to 2 in the Roles section. The lessee would remain as 1 role unless there are multiple owners of Flat 1 and they have different CP's.

When preparing the instrument, the 'Insert Names' button (displayed at the bottom of the Prepare Image screen) should be used to display the screen in which to enter the names of the parties for the lessor.

When the solicitors are completing the certifications for their client(s) they will need to:

• Use the "Select Names" button to select their clients names in the “Select names” screen
• Complete the Lessor certifications
• The CP acting for the owners of Flat 1 will also need to complete the Lessee certifications.

The CP acting for the owners of Flat 1 should also ensure that the A&I completed by those client(s) authorises the CP to act as both lessor and lessee.

Certifications for multi party instruments

Some instruments in Landonline (eg Easements, Leases etc) require consents from affected interest holders (eg mortgagees, caveators, territorial authorities etc).

These types of instruments will display multiple certification options for each interest on the affected title(s)and it is important that the Conveyancing professional (CP) fully understands these different certification options.

If there are different mortgages/caveats on different titles, all of the mortgages/caveats etc will be displayed for certification.

When signing these types of instruments the CP will need to select the appropriate option for their client and the mortgage/caveat.

For example: An easement will display the following mortgage certification options for the grantor to select from:

1. I certify that the Mortgagee under Mortgage 123456. 1 has consented to this transaction and I hold that consent
2. Mortgage 123456.1 is being discharged/extinguished in a prior dealing or in the same dealing
3. Mortgage 123456.1 does not affect the servient tenement, therefore the consent of the Mortgagee is not required.

If the CP is acting for the grantor and the mortgage number refers to their clients land (ie the servient tenement), the CP should select either 1 or 2 depending on the situation:

• If the mortgage is being discharged in the same dealing or in another dealing that will be registered prior to this dealing, then the CP can select option 2.
• If the mortgage is not being discharged or won’t be discharged until after the registration of this dealing, then the CP should obtain the consent of the mortgagee and select option 1.

However if the mortgage number refers to the other parties land (ie the dominant tenement), then the CP can select option 3.

If the easement being granted is a reciprocal easement (ie the parties for both titles are granting easements), the dealing should be set up with each CP as both grantor and grantee (see Setting up an edealing instrument with multiple parties (http://www.landonline.govt.nz/about- landonline/newsletter/landwrap/201408?qt-landwrap_archive=1#7215) ).

In this case the CP will make certifications in relation to those mortgages that affect their clients land (eg Options 1 & 2) and can select option 3 in relation to the mortgages that affect the other parties land, as the CP for the other parties will hold the consent for their mortgagees. 

For a Variation or Surrender of easement an additional certification option will display:

I certify that the territorial authority has consented to this transaction and I hold that consent, or the affected easement is not the subject of a condition imposed by the territorial authority.

If the easement being varied or surrendered is a compulsory easement, the councils consent will be required pursuant to s243(a)(iv) Resource Management Act.

For a variation of cross lease, the following certifications will display for the lessor:

1. I certify that the Mortgagee under Mortgage 123456.1 has consented to this transaction and I hold that consent
2. Mortgage 123456.1 is being discharged/extinguished in a prior dealing or in the same dealing
3. Mortgage 123456.1 does not apply to the estate or interest affected by this transaction

The third option should only be used if there are separate CP's acting for the different lessors and the Mortgage affects the lease that is not being varied.

Setting up an e-dealing instrument with multiple parties

Creating dealings that involve multiple parties and Conveyancing Professionals (CPs) can be complicated and requires some care.

The set up of the dealing is particularly important as it affects who the CP is acting on behalf of and what certifications display for the CP. If you are creating an instrument that has:

• multiple titles
• different ownership, and
• different solicitors acting for the different parties, you need to ensure that the dealing is set up correctly on the 'Create dealing' screen.

For example:

An Easement instrument (EI) where there are 2 titles and the owners of those titles are granting reciprocal easements and therefore will be both grantor and grantee. When setting up the dealing, you would need to create two roles for both the grantor and grantee roles by changing the "No of CPs" field to 2 in the Roles section.

When preparing the instrument, the 'Insert Names' button (displayed at the bottom of the Prepare Image screen) should be used to display the screen in which to enter the names of the parties for the grantee and then the grantor.

(Please note: in this example the same names will be entered as both grantor and grantee).

When the CPs are completing the certifications for their client(s), they will need to:

• use the "Select Names" button to select their clients' names in the "Select names" screen
• complete the certifications as both grantor and grantee.

The CP should also ensure that the A&I completed by the client(s) authorises the CP to act as both grantor and grantee.

Conveyancing Self-Assessment Results 2013/14

LINZ would like to thank the 39 firms that participated in the annual self-assessment questionnaire.

The participants provided valuable insights into their control environments and have made feedback suggestions to help to improve the questionnaire.

The questionnaire, available on the LINZ website, was developed by LINZ in conjunction with the Property Law Section (PLS) of the NZLS and NZ Society of Conveyancers. The objectives of the questionnaire are to enable firms to assess their own conveyancing processes and controls, provide guidance on controls and inform LINZ and NZLS about the level of sophistication of law firm control environments for conveyancing and how we might best support the profession.

The 2013/14 summary results are:

• Just over half of firms use checklists and segregate duties within the checklist.
• There are large firms that do not have checklists (preventative) or peer review (preventative /or detective) controls in place.   The majority of firms (79%) have been prompted to review current controls.
• The majority of firms (87%) responded that the questionnaire has improved their understanding of what controls should be in place.

Overall feedback on the questionnaire has been positive. One responded:

"Excellent review which has provided an opportunity to refresh our knowledge in this important area"

Sole practitioners and firms with multiple Conveyancing Practitioners use internal controls to help ensure that their firm is operating according to legislative requirements.

The controls implemented vary across firms - from informal controls (open office environment, go-to-expert in the firm) to formal controls (office policies, password security policy, e-dealing checklists, and peer review process). The level of controls implemented determines how robust a control environment is.

As Conveyancing Practitioners are ultimately responsible for their certifications, they need to be personally satisfied the dealing is in order (s8.67 PLS Guidelines). Having a robust control environment supports the quality and accuracy of the work completed.

LINZ will be selecting another 200 firms in May 2015 to complete the questionnaire. This is an opportunity for the 200 firms to provide feedback on improvements to the questionnaire and share the controls your firm has in place. In the meantime, the questionnaire is available on our website (http://www.landonline.govt.nz/edealing/regulatory-info-guidelines/self-assessment-questionnaire) for your internal use.

Non-primary Parcels: Ascertained and Verified explained

This article clarifies the Rules for Cadastral Survey 2010 (RCS 2010) and Landonline capture requirements when creating a new non-primary parcel that partially coincides with its underlying primary parcel and has the Dataset Type of Parcels without Survey Information (PWSI).

On 1 November 2012 Rules 8.1(d)(iv) and 3.3.1(c) were inserted into the RCS 2010. These additions relate to non-primary parcels and their associated underlying parcel. Rule 8.1(d)(iv) should be read in conjunction with Rule 3.3.1(c).

Requirements

Rule 8.1(d)(iv) requires sufficient vectors to enable the relationship between non-primary parcel boundary points and their underlying parcel boundary points to be ascertained and verified in accordance with the accuracy standards in Rule 3.3. Rule 3.3.1(c) states boundary accuracy standards apply between the boundary points of a non-primary parcel and the boundary points of its underlying parcel where that underlying parcel is not created by the survey. Sufficient vectors are therefore required to unambiguously:

• ascertain boundary relationships; and
• verify boundary accuracies.

Capture all vectors that verify and ascertain. The Standard for lodgement of cadastral survey datasets requires all survey marks, boundary points, vectors and arcs that are required by the Rules, to be captured. Depiction on Diagram of Parcels and Diagram of Survey. Rule 9.6.13(a)(ii) requires the ascertaining vectors to be included on a Diagram of Survey. For PWSI datasets, if you choose not to have 'S' sheets, these vectors must be added to the ‘T’ sheets. Consider depicting all vectors used to ascertain and verify as this may assist end users in determining the location of non-primary parcels in relation to the underlying parcel.

Examples

Scenario 1

In Figure 1, LT 4321 seeks to create AREA A over part of Lot 1 DP 123.

 The part boundary distance PEG (1) DP 123 to UNMK 1 ascertains (red line) the boundary relationship between AREA A and Lot 1 DP 123. The part boundary distance UNMK 2 to PEG (2) DP 123 verifies (green line) this relationship.

Scenario 2

In Figure 2, LT 4321 seeks to create AREA B over Lot 2 DP 123.

The part boundary vectors UNMK 5 to PEG (4) DP 123 and PEG (4) DP 123 to UNMK 7 may be viewed as ascertaining (red line) and verifying (green line) each other; the boundary relationship between AREA B and Lot 2 DP 123 is adequately locked-in.

Depicting changes to Units and Common Property in the CSD diagrams

Where a redevelopment is changing the shape of an existing unit or Common Property, the CSD diagrams must clearly depict the spatial relationship between the estate interests being cancelled (associated with existing unit(s) or Common Property undergoing change), and new interests being create.

This means that the CSD diagrams must show the referenced estate boundaries of the cancelled titles where they do not coincide with the new titles. This requirement is set out in rules 9.6.3(h)(i) and 10.4.2(f)(i) of the Rules for Cadastral Survey 2010. Two examples are illustrated below:

Land from PU2 being added to PU1 (plan view)

Land from PU1 being added to Common Property (elevation)

Converting a stratum boundary to a permanent structure boundary

Where an existing unit boundary is being converted from a stratum boundary to a permanent structure boundary with the intention that the boundary is the same boundary then this fact must be made obvious to the CSD user. Reporting this information in the survey report or annotations on the CSD diagrams are two ways of addressing this issue.

Appellations for Māori land affected by legalisation surveys

Where a legalisation survey is going to affect Māori freehold or customary land, the remainder land that is not part of the legalisation action must have either a General land appellation in the form of a section number or a Māori land appellation.

Irrespective of the type of appellation, it must have the approval of the Māori Land Court (MLC). This is a requirement of the Court outside those specified in Rule 5.5.3 of the Rules for Cadastral Survey 2010.

The approval from the MLC must be included in the CSD supporting documents or alternatively, a statement in the survey report that the MLC have approved the appellations will be adequate.

Further information is available in Sections 15 and 16 of the Interim Guideline to aspects of survey requirements applicable to Maori Land surveys (//www.linz.govt.nz/about-linz/news-publications-and-consultations/search-for-regulatory-documents/linzg65703) (LINZG65703).

Pre-validation Reporting

Some e-survey users are running Pre-validation only after they have completed Plan Generation. By not running Pre-validation prior to performing Plan Generation, users run the risk of:

• Geometry errors being reported as Plan Generation is opened up,
• Error 47 messages opening Layout Sheet,
• Diagrams being distorted when Layout Sheets have opened up.

These issues can be avoided if you run pre-validation prior to Plan Generation, and address the C-rule conflicts and warnings and the errors in both adjustment reports. For example, in the adjustment reports you may note that the Standard Error Unit Weight (SEUW) is too high i.e. over 1, suggesting error(s) in your data capture or linking of marks.

Conclusion: An early check of the Pre-validation report, with particular attention on the two adjustment reports, will help you identify capture errors prior to Plan Generation, resulting in less rework.