Buying land in Kenya involves several key steps. The contract stage is an important step in the process of acquiring a proper title deed. Land agreements in Kenya play a pivotal role in successful land buying.
Land transactions are marred with fraud hence, a land agreement in Kenya is a crucial document when buying land. As a buyer, you need to know your rights and obligations in the land transactions to avoid the pitfalls and find yourself deep in endless court battles or having lost your hard-earned money to swindlers.
An agreement to sell land is basically a contract. Land agreements are an important part of any asset transaction including land.
They stipulate the terms and conditions of the transaction and reduce sources of dispute. It fully protects the rights of both parties and states what happens in the case there is a breach of the terms. Whenever parties fail to have an agreement, there are usually disagreements because the terms of the transaction were never written down.
Land agreements in Kenya is made in the same way as any other contract. Parties to a contract must endeavor to make a simple, understandable contract which is evidenced in writing.
There must be a final, complete, written contract on at least the essential terms including the basic ingredients of a contract being offered, Acceptance, Consideration, Capacity, and Intention to create a legal relationship.
A good and enforceable agreement will not only exhibit offer, acceptance, intention to be bound, capacity, consideration, and certainty in the terms but must be in writing, signed by both parties and their signatures attested to by a competent witness preferably and advocate.
A land sale agreement must at whatever cost be certain. If a sale agreement is not certain even if one complies with statutory provisions the agreement will be void. Any sale agreement that contains uncertain clauses is void and specific performance or reliance on it for any remedy will not be allowed.
The parties to any contract must be properly identified. The names of the parties to the contract as well as their addresses, Identity Numbers, Certificate of Registration (if a company) must be properly stated in the contract.
The address is crucial if there will be a need to issue a notice to either party
This entails a description of the subject property. Both the physical and legal descriptions of the property are given in the particulars of sale. Encumbrances, if any, also constitute part of the property definition. Occasionally, fixtures and fittings will form part of the particulars of sale.
This is usually included in the particulars part. The position on encumbrances i.e. the property is sold free of encumbrances. If there is an encumbrance, you must indicate who is to service the loan/discharge the encumbrance. You must state that the purchase price will be used to offset the balance of the encumbrance/loan. Avoid allowing the clause ?sold subject to all encumbrance.
It is advisable that this section also provides express dates for fulfillment of payment of the purchase price. This includes the deposit and the structure of payment of the balance of the purchase price.
A land agreement in Kenya should disclose those terms are those terms that are specific to and relevant to the contract in question. They will involve issues of vacant possession, deposit, fixtures, fittings, remedies in the event of default, the contract is subjected to a mortgage facility, variation of general conditions, etc. They are those conditions that apply sui generis to each agreement. They are being extended to mean the variations of the general conditions. For this reason, it forms a separate part of an agreement.
These are terms which in the absence of any specific terms apply generally to the open contract. They came from implied terms which have been complied with together from common law, equity as well as conveyancing practice generally.
The general conditions apply also to fill up gaps in a contract and cover a variety of matters e.g. regulating right to rescind, preparation and content of transfer, possession, and grant, deposit and forfeiture, notices, and completion.
Completion is the process in a conveyancing transaction where necessary documents of title are handed over in exchange for the price. After investigation of titles and execution of the sale agreement, the next and final stage is the completion and transfer
This section will include the obligations that the purchaser and the seller will have before the transaction moves to the next stage of transferring the property to the purchaser. Essentially, the purchaser is to deliver the purchase price and the vendor is to deliver the completion documents.
The date of completion must be stated i.e. time is of the essence. This section will also provide for the place of completion.
Where there is a financier, a professional undertaking is given instead of the money/cheque. One also has to state vacant possession.
Completion documents include title documents, Clearance and Consent certificates, executed transfer, photos, consents, stamp duty valuation forms.
Once you have identified a suitable land that you desire and terms have been agreed upon, it’s advisable to carry out due diligence before going to the next step of putting down the terms of the sale agreement in writing or executing the land sale contract. It’s only after you have done your due diligence and you are satisfied that you are dealing with a genuine owner of an existing property can you proceed to the next stage of signing a land agreement in Kenya. It is important to get an advocate to make you understand the clauses of the contract and make sure that the clauses in the contract meet all your requirements.
Should you have any questions regarding the general land buying process or drafting land sale or lease contracts, contact Matagaro of the Matagaro Sironga Law Advocates at [email protected]
