Get ready to embrace the digital document revolution - Alison Scott
Without overlooking the momentous, continuing impact of Covid-19, the pandemic has undoubtedly forged digital progression forwards at unrivalled pace in all walks of life. The legal profession is no different and no more so than for conveyancers.
Lawyers are known for a liking of tradition and precedent. Paper, wet ink signature and the need for a witness all lend a physical reassurance. However, the effect on postal and delivery services and office closures during the spring lockdown unleashed digital signatures and electronic documents into the world of real estate practice in Scotland, most notably in relation to formal missive letters.
This perhaps felt futuristic to some, although the use of these technologies in conveyancing practice has been possible since 2014. The main factor behind the slow uptake has probably been the inability to register most forms of conveyancing deeds in electronic form in the property registers. Registers of Scotland (RoS) have had an existing digital registration system (ARTL) in place for a number of years but its scope and uptake have been limited.
Although digital signatures on discharges of residential standard securities have been recognised and used since 2017, for the majority of property transactions wet ink signatures and paper deed applications to RoS were still required at the turn of the year. Enter Covid-19, when a lack of physical presence in RoS's office made postal applications unworkable. In response, RoS successfully launched a series of innovative digital solutions that protected house moves, the property market and wider Scottish economy.
Emergency provisions were introduced as part of the Coronavirus (Scotland) Acts which enabled RoS to accept digital submissions of scanned paper deeds. Over 112,000 submissions have been safeguarded by the new digital systems since the launch. Wet ink signed paper documents are still required to be held by solicitors but submission of these in digital form represents significant advancement, more in-fitting with modern technological capabilities.
So what next? Current legislation allowing digital submission of scanned paper deeds is temporary and further legislative change requires Holyrood approval to become permanent.
However, a more significant change is on the horizon. In 2016, in their consultation paper Digital Transformation: Next Steps, RoS set out proposals to go further and enable electronic (as opposed to paper) dispositions, standard securities and discharges to be drafted, revised, signed and registered digitally, within one secure system run by RoS. It is proposed that once the digital system is implemented, its use will be compulsory (with limited exceptions) following a transition period where systems allowing registration of both paper and electronic deeds will run in tandem. The paper proposes a six-month transition period but to facilitate a smooth transition with the profession, in practice it is recognised this period may be longer. Compulsory digital applications will reduce administrative costs associated with a dual system and will ensure the profession does not move forward at the pace of the slowest or least willing to embrace digital change.
RoS has confirmed that developing a system which will allow registration of digitally signed electronic deeds is an ongoing process and a definitive timescale for its implementation is difficult to give.
However, RoS has made significant progress towards achieving this goal in developing the systems to enable digital submission of scanned paper deeds during lockdown. The legal profession’s view is perhaps best summed up in the words of The Law Society of Scotland:
‘It has been a challenging time but the profession [has] embraced the digital enhancements that RoS have introduced during the pandemic, for example, the digital submission service. RoS have done great work to introduce these systems and we are keen to see these provisions made permanent.’
RoS has launched a public consultation into making permanent changes to the way some applications are submitted The profession and stakeholders are invited to participate in the consultation which closes on 1 February.
Lawyers by necessity need to look backwards for existing legislation, case law and precedent. But we must also look to the future for innovation to ensure Scotland remains competitive in a global context. The legal profession is now ready to embrace electronic documents as valid tender in property transactions and the solutions implemented by RoS in the face of the Covid-19 pandemic means this new reality seems closer than ever before.
Alison Scott is a senior associate, DLA Piper
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