Laws toughen requirements for sale of property

Planning to sell land or real estate to a company or institution? Then be prepared to let your spouse know that you are about to dispose of your property.

It may be just a piece of land you bought without your better half’s knowledge and you want to sell it for a quick buck.

But as long as you are married, most lawyers will be adamant that your partner’s consent has to be obtained. And if you are single, you may have to swear an affidavit to that effect.

The reason why some lawyers and companies stand their ground in such deals is the Land Registration Act 2012 — the legislation that applies when property is transferred from one name to another — which has drawn the chagrin of many men since its assent.

“The Land Registration Act assumes that there is joint ownership of any property owned by married people,” explains lawyer Moses Owuor of Nairobi-based MMA Advocates.

Mr Ezekiel Karanja Ndune came face-to-face with the application of that law when the High Court in Nairobi made a ruling in a land case in December 2014.

In a case filed by his wife Susan Karanja, the court heard that he sold land in Nairobi’s Milimani estate without her consent.

Mrs Karanja said she learnt of the sale only after a search at the land’s registry, where records showed that the property had been sold for Sh100 million.

Mrs Karanja approached the court seeking nullification of the ownership transfer.

“Mrs Karanja pegs the requirement of her consent on the fact that the registered proprietor, Ezekiel Karanja Ndune, is [her] spouse and that under Section 93(3) of the Land Registration Act, spousal consent was necessary before transfer of the suit property,” wrote Justice Joseph Onguto.

After deliberating on the matter, the judge concluded that the buyers of the property needed to have established beyond doubt if the seller was married or not.

“The transferee must therefore not only be absolutely certain as to the existence of the spouse(s) but also the consent to the transaction by such spouse,” the judge said as he ordered that the land sale be temporarily stopped and that the husband be included as a respondent in the case.

WIFE'S APPROVAL
Cautious not to have such eventualities after land is sold, lawyers insist on involving spouses in land sales, even though a person can still legally sell property in their name as long as it is not where the family lives.

“Lawyers will still ask, because you don’t know what is matrimonial property and what’s not. It is more or less blanket,” said lawyer Harry Mosi of Nairobi’s Mosi and Company Advocates.

Mr Mosi added that keeping a spouse in the loop is mainly meant to insulate the buyer against uncertainties that may follow.

“It is actually not the lawyer but the purchasers’ interests. So that if the purchaser is exposed to a level where they’ve finished paying and the (seller’s) wife wakes up and says ‘ABC’, what recourse does he have?,” he said.

The Sunday Nation has learnt that men selling property are also dreadful of local boards that deal with transfer of property, especially in rural areas, as they are likely to demand for the wife’s approval before the sale.

Businessman Roy Togom, who sells property in Kajiado County, shared a story of a man whose efforts to sell land hit a snag when he approached a Ngong-based board.

The man was, however, not willing to be interviewed.

“Recently, there is an old man I sent to Ngong. He came back and told me, ‘These Ngong people want the wife to sign something she did not participate in buying.’ I told him, ‘You just have to cope with it because it is your wife,’” Mr Togom said.

A year after the Land Registration Act came into effect, the Matrimonial Property Act was assented into law on December 24, 2013.

The latter Act gave married people more freedom to sell land that is not the family residence and which the spouse did not take part in buying — especially after a divorce.

“The Matrimonial Property Act brings a twist because it presumes that if you acquire property, the ownership is separate unless there is indication of joint ownership,” said Mr Owuor, the advocate.

He added: “In the Land Registration Act, there is a presumption of joint ownership. In the Matrimonial Property Act, there is a presumption of separate ownership.”

PROACTIVENESS
Mr Owuor said the requirement that a spouse be contacted is sure to arise in any land sale when name transfers are being effected in the title deed.

“The Land Registration Act is the one that is used to register documents relating to land or transfers. So it governs the transfer,” he said.

Despite the subtle differences in the laws applicable, some property dealers are leaving nothing to chance.

Ms Nishma Karia, who has been running a property sale business in Kisumu since 2011, said a sale agreement from her firm, Lake Estate Agency, is not complete without a signature of the spouse being included in the appendix.

“It is very important to get the consent of the wife and both signatures to be on the sale agreement so that it can be fast-tracked,” she said.

What if a person says they are single? “Then you have to swear an affidavit that you are still a single person,” she answered.

“If you get caught, with time, and you’d sworn an affidavit, then it will be up to you, right?”

Ms Karia explained that if a couple wants to avoid legal hiccups in the sale of property owned before marriage, it is advisable to have an agreement before marriage saying which property can be privately owned.

“In that event, you have a pre-nuptial agreement with your spouse that ‘whatever I owned before I got married is purely mine and I will not share that with you’, and the spouse signs on that; then it’s fine. That is then attached to the sale agreement,” she said.

But for Mr Benard Onchieku, who is the executive director of K26 Estate Developers that buys and sells land in Nanyuki, Nairobi, Mombasa and other areas, what matters is the person whose name appears on the title.

“We have different kinds of properties. We have matrimonial, which is usually ancestral land; the one that is known as the land of the home. Then we have commercial land; the one which a person has bought out of his sweat. That one, usually, the owner has a right. If it is a woman, she can sell for herself or the man to sell on his own,” he said.

“It is not a must that when you sell land you should involve a lawyer,” added Mr Onchieku, who has dealt in land for over a decade.

“Sometimes when the man wants to sell, he doesn’t want anyone to know about it, because that is property that he bought on his own. You know, there are people who buy and don’t want either their husbands or their wives to know... If it is someone who bought on their own and the family is not aware, you cannot start involving people who are not aware,” he said.

THE LAW SAYS....
When sales like the one Mr Onchieku explained happen, some women go to court to seek redress using a provision in law that states that contribution towards acquiring land needs not be monetary in nature.

For instance, a woman in Busia approached the High Court in 2012, saying she was entitled to a share of five parcels of land owned by her husband with whom they had divorced.

“The evidence of (the woman) was that she got married to (the man) when she was 18 years old and, not surprisingly, did not bring any money into the marriage. She joined her husband in an ongoing business. That business was a well-stocked auto spares shop,” Mr Justice Francis Tuiyott wrote in his judgment of February 2014.

The judge, in arriving at his decision, said: “Article 45(3) of the Constitution provides that parties to a marriage are entitled to equal rights at the time of the marriage, during the marriage, and at the dissolution of the marriage”.

And though the husband’s side argued that she had not done much in obtaining some of the plots, and that she had been given one plot to dwell on, the judge ruled otherwise.

“This court, after weighing all the evidence, reaches a decision that (she) made a non-monetary contribution to the development of the plots... I have no doubt that (her) contribution towards the improvement of the plots... deserves acknowledgement,” the judge said as he ordered the valuation of three other plots for partition.

But what if the property seller is polygamous?

“I have a client who is polygamous,” Mr Mosi said. “But the banks know that he is polygamous; so they normally insist in both wives signing. But in some circumstances, the banks don’t know. You’ll only go to the side that is comfortable to you. After all, who is going to ask you out there whether you have two, three or four wives?”