Conveyancing

Posted by Brian Muriithi 08/10/2019 0 Comment(s) Investing, Finance & Economics,Government & Law,

CONVEYANCING

 

 

Often we get clients coming to our offices wanting to buy land and or property. Most come to us for legal advice and subsequently instruct us to carry out the conveyance of the rights and title over the same. It is unfortunate that such an important, yet very emotive aspect of the Legal Practice is not well understood in Kenya. So, what is Conveyancing?

Conveyancing as we know it or ought to know it, is the transfer or alienation of Title and Interest in Land from one person to another. The hereinbefore mentioned Title and Interests can be conveyed through the following documents:

  1. Transfer
  2. Lease
  3. Charge or Mortgage as it was known then.

Land and the interests thereto can be a very emotive issue and therefore it is imperative that the parties involved to be extremely careful and engage the services of an Advocate.

An advocate as fiduciary owes it to their client to ensure that due procedure is followed. Herein below are some of the steps that an Advocate in conduct of the matter should follow:

  1. Investigation

In this stage of the transaction your Advocate should probe the Title Document. This is done by conducting a search at the Land Registry and where necessary the Companies Registry.

By conducting a search one is able to ascertain proprietorship.

 

 

  1. Documentation

Once your Advocate ascertains that the Title is ‘clean’ and advises that you proceed with the transaction, they will then prepare the following documents setting out terms as agreed  and to be executed by the parties:

  1. Sale and Purchase Agreement

The Sale and Purchase Agreement should at least have the following salient clauses; Parties (Purchaser & Vendor), Property, Consideration, Interest, Forfeiture, Warranties, Applicable Law and Arbitration. It should then be duly executed and witnessed by Advocates of the Parties.

  1. Transfer

Ordinarily this is executed upon payment of full consideration or where the Sale and Purchase Agreement specifically states that the consideration will be paid upon successful registration of the Purchaser’s interest, then the Vendor’s advocate will require a Professional Undertaking in their terms be given by the Purchaser’s Advocate and once satisfied they will then release the duly executed Transfer together with the Completion documents.

This document essentially alienates the Title and Interest in Land from the Vendor to the Purchaser.

 

 

  1. Charge

Charge is prepared in the event that the purchase is financed in one way or the other and is duly entered into the encumbrance section of the Title. The Financier charges the property to secure their interests.

Further on, a lot of clients do not seem to understand the financial implications or obligations that come with the buying of land or property. Hereinbelow are some of the costs to consider before buying land or property:

  1. Deposit, often developers and or proprietors will ask for a percentage of the selling price as deposit. One needs to be very careful when signing the Sale Agreement, therein you will find the Forfeiture Clause. In the event that the Purchaser is unable to complete the transaction for one reason or another, then the deposit is forfeited to the Vendor.
  2. Statutory Fees, these include LCB Consent Fees (where applicable), Valuation Fees ( where applicable) and Stamp Duty. Stamp Duty is calculated at either 2% or 4% of value (Government Valuation). If the transaction is financed, there is Stamp Duty that is payable on the Charge Document.
  3. Legal Fees, as it suggests, this is the amount paid to your lawyer.

 

This is simply a guide on Conveyancing and not an authority on what ought to happen. Different transactions may call for different approach.

 

 

Author,

Brian Muriithi Muthomi,

Muriithi Muthomi Associates Chambers (MMAC Advocates)

Mezzanine Floor,

Titan Building, Chaka Road

Email; bmuriithi@mmac-advocates.co.ke

 

Tags: Conveyancing

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