Property
rights
23/03/2004 The Star Articles of Law with Bhag Singh
GENERALLY, buying a
landed property may appear to be a straightforward affair. Whether it is a
house or an apartment or a commercial property, the underlying principles
are the same. There should not be any problems.
A reader wants to know if, when a Sale and Purchase Agreement is drawn up
and the transaction is handled by a lawyer, the buyer is absolutely safe so
long as he has the means, either via cash or a loan, to meet the purchase
price?
The fact that the transaction is handled by a lawyer is not a guarantee that
there would be no problems in carrying out the transaction or after the transaction
has been completed.
Many elements and factors are involved in the acquisition of a property. Depending
on the nature of the property involved, input from different people and parties
may be required. A lack of input in the appropriate manner may lead to complications
and difficulties.
A buyer of a piece of land may provide his lawyer with the title and lot number
of the land with its location. A copy of the title may also be furnished.
The lawyer will make a search to see whether there are any encumbrances.
The purchase price may be deposited with or paid to the lawyer who, after
taking the necessary steps to have the ownership of the land transferred to
the buyer, releases the purchase price to the seller. The transaction has
at this stage been completed.
However, when the purchaser proceeds to use the land he finds that the land
is unsuitable for the purpose he had in mind. It may be that the land is in
a swampy area where he cannot plant the crops he planned to, for example.
In such a situation the lawyer who handled the transaction and was unaware
of the purchaser's undisclosed intention has dealt with the matter as instructed.
What should the buyer have done in such a situation?
The purchaser should have disclosed to his lawyer his plans for the land and
to ensure that appropriate provisions were included. If this were the case
it would have been helpful to engage a surveyor or some other suitable specialist
who could examine the land and provide the necessary advice.
It would also be necessary to have incorporated appropriate provisions requiring
the seller to give undertakings and warranties to ensure that the land was
suitable for the purpose. Whether a seller would be prepared to give such
an undertaking and to what extent would be a separate matter.
A different kind of problem could arise from the phrase “free from all encumbrances”
commonly used in Sale and Purchase Agreements.
A building may be constructed on the land belonging to the buyer but there
may be various types of protrusions which extend into the airspace of an adjoining
land which at the point of time of the purchase was vacant.
Apart from protrusions, the previous owner may have constructed a fence or
even a structure that encroaches onto the adjoining part of land which on
ordinary physical inspection may not be obvious or appear to be of little
or no significance.
However, there may come a time when the owner of the adjoining land may want
to occupy the land and to construct a structure on it. Such a person would
be entitled to every inch of the land which belongs to him.
If the local authorities have made a mistake in giving approval in circumstances
where there has been an encroachment, this does not deprive the aggrieved
party from asserting its rights.
However, instances where approval was given by a local authority even though
there is a form of encroachment into the space of another are not unknown.
Such approvals are in all likelihood conditional so as to protect the interest
of the person who could as a result be aggrieved.
But such conditional approvals are not reflected by way of endorsement on
the documents of title and therefore are not easily discoverable by the intended
buyer of the property who must in such cases protect himself with appropriate
undertakings. Such incursions would in law amount to trespass onto the adjoining
land of the neighbour to which he is entitled to object.
The purchaser will naturally feel that he is innocent because when he bought
the property it was in that condition and with those features.
He will not be able to see the justification of giving up on these and even
worse, incurring expenses to have such incursions removed.
The purchaser may also feel that when he bought the property it had been approved
by the local authorities and that this would be an indication of his righteousness
and that he should now not be liable for such alleged wrongdoing.
All this, however, will not constitute a valid argument against the neighbour
onto whose land there has been trespass by the purchaser.
No one including the local authorities would have the right to allow one person
to encroach into the property of another or to deprive anyone of his property
rights.
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