If Landonline is unavailable on settlement day due to an outage, the lawyers for the vendor and purchaser will need to work together to determine the appropriate course of action, based on the terms of the agreement for sale and purchase and the New Zealand Law Society Property Law Section Guidelines (the PLS Guidelines).
New Zealand Law Society Property Law Section Guidelines
Property Law Section Guidelines
Guideline Y (para 6.90) of the PLS Guidelines puts an obligation on lawyers to co-operate with each other to perfect a transaction.
‘Lawyers are required to co-operate with the lawyers for the other parties to a transaction to ensure that registration is completed as intended by the parties.’
If an outage occurs after payment of settlement funds, certified and signed instruments may no longer be available and all parties will need to work together to certify, sign and release the dealing again.
The settlement undertaking prescribed by para 5.12 of the PLS Guidelines includes the following text regarding outages:
If, due to a Landonline, electricity or telecommunications outage or an emergency, you are not able to immediately release the instruments, you will:
- advise the purchaser’s lawyer of the delay and the cause of the delay;
- take all available steps to effect the release as soon as possible; and
- not disburse the settlement funds until the release has been effected.
These undertakings clearly set out the vendor’s obligation to release the dealing as soon as possible and to hold the settlement funds undisbursed in the meantime.
It is important that parties obtain advice from their lawyers about the implications of a Landonline outage on settlement day and that the parties’ actions are consistent with the Agreement and the PLS Guidelines.
How to prepare in case Landonline goes down
There are three fundamental practices that can help mitigate the impact of the unavailability of Landonline. These are:
- Obtain guaranteed searches prior to settlement day
- Certify and sign the e-dealing prior to settlement day, and
- Settling without Landonline.
Guaranteed searches
A guaranteed search may be obtained under section 60 Land Transfer Act 2017 at any time and it is recommended that this occur before the day of settlement. Compensation may be sought pursuant to section 60(4) in relation to any search made during the “first period” i.e. 5 working days commencing on the fourth working day preceding the date on which the transaction is settled.
Settlement - Certify and Sign in advance
It is recommended practitioners certify and sign any instruments in advance of settlement day.
This practice is secure, in that registration can only be effected once all in an e-dealing have been released.
Settling without Landonline
Settlement can still occur between the parties using an undertaking regardless of access to Landonline – see guidelines see paras 5.12(v) and 5.25(d)(vi) of the PLS Guidelines.
All documents can then be released as soon as practicable when access to Landonline is restored.
Improvements to Landonline
LINZ works to continuously improve the internal factors that impact the robustness and performance of Landonline.
This includes:
- Capacity upgrades, to monitor various areas of the system and schedule upgrades accordingly. To ensure suitable capacity ahead of additional customer numbers using Landonline, LINZ monitors key areas such as the Citrix servers, the processing units and our databases.
- Scheduled releases, which include major technology updates to the Landonline application and database. An example is the change of the image storage system from FileNet to Centera.
- Reactive improvements, where we improve things quickly, particularly if a fault has occurred. These improvements may be carried out prior to an upgrade or release.
LINZ also monitors the performance of its vendors to ensure they are managing our systems effectively and efficiently on our behalf.
Unfortunately, there are also other factors that impact our customer's experience of Landonline, which LINZ does not have control over. These include the set up and performance of a customer's internet service provider (ISP) connection, the performance of the ISP itself, and the set up and maintenance of customers' computer systems.
It is important that firms read Landonline technical support information to ensure their IT structure is optimal, especially operating systems and internet connections.
Landonline technical support information