Council of Mortgage Lenders Handbook
Article by John Lunn on behalf of of CML (extract)
CML Handbook
Clause 18 – Automated Registration of Title to Land (“ARTL”)
This is, of course, an entirely new clause. The provisions apply in relation to dealings under the ARTL system operated by the Registers of Scotland and as such they are supplemental to the remaining clauses in part 1. Although ARTL has not yet been launched, the CML was keen to have provisions in place in part 1 which would provide a basic framework and point of reference for solicitors. Lenders will therefore be able to indicate in their part 2 responses to clause 18 whether they are participating in ARTL, and the extent to which they are doing so.
Clause 18.1 requires that solicitors must comply with the Solicitors (Scotland) (Automated Registration of Title to Land Mandates) Practice Rules 2006 and any other practice rules or guidance notes issued by the Law Society of Scotland and/or the Registers of Scotland. I understand that the Keeper of the Registers of Scotland is planning to issue his own guidance notes – to be called Keeper’s Directions. The Society’s ARTL Steering Group is also close to publishing its guidance notes for solicitors on ARTL.
Clause 18.2 relates to standard securities and requires solicitors to check their mortgage instructions and/or the lender’s part 2 to see whether the lender allows the solicitor to complete and register the standard security on ARTL. Where the lender is participating in ARTL in this respect, the solicitor should send a copy of the standard security to the borrower. Where the lender has more than one style of standard security held on ARTL, the solicitor should check their mortgage instructions to see which style they should use.
Clause 18.3 relates to discharges and requires solicitors to check the lender’s part 2 or the ARTL system itself to see whether the lender will digitally execute the discharge. Where the lender has digitally executed the discharge and has returned it to the solicitor within the ARTL system prior to redemption, the solicitor must hold the discharge as undelivered until the solicitor has sent the redemption money to the lender.
It may well be that the ARTL clauses will need to be beefed up as practice evolves, but clause 18 should provide solicitors with a starting point in relation to the requirements of their client’s mortgage lender.
