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Before buying land, get lawyer to do due diligence

By Harold Ayodo | May 5th 2016 at 00:00:00 GMT +0300

We are a chama of five and resolved in our last two meetings to buy land on the outskirts of Nairobi. We intend to subdivide the land among ourselves for private ownership. However, we are concerned about cases of government institutions claiming ownership of properties that have been bought through legal procedures. What can we do to ensure no one later comes to lay claim on the land we are planning to buy? Is there any legal requirement to be undertaken before purchasing land from a parastatal or state corporation to avoid instances where the transaction is revoked?

Rebecca, Nairobi.

It is important to engage a duly-registered and practising property lawyer to do due diligence before paying for the land. The lawyer is supposed to get written consents from relevant authorities and from those with property adjacent to the land you want to buy. A property transaction cannot be legal without getting approvals of the authorities.

As land is scarce in Nairobi, most middle-income buyers are scrambling for affordable plots in formerly agricultural areas of Syokimau, Mlolongo, Kitengela and Namanga.

Purchasing such agricultural land is not possible without obtaining a written consent from the Land Control Board, according to the Land Control Act. And in some cases, if the property targeted is leasehold, a written consent from the local authority may be necessary.

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Separately, there are some investors who buy property from public corporations like the Kenya Railways or Kenya Ports Authority.

For instance, Kenya Railways at one time announced plans to sell off two prime properties and several parcels of land to settle arrears owed to its pensioners. It earmarked White House in Nairobi, Chambilo Estate in Mombasa and six plots in Nairobi for sale to pay its pensioners arrears worth Sh394 million. The sale of two other residential properties and parcels of land on Kindaruma Road, Ngong Road and Railway Club in Nairobi was to bag Sh4 billion.

For such, official concurrence in writing from the corporation must be obtained to avoid disputes after developing the property. A green light from trustees is also important before transactions on property vested in bodies like the national parks.

There are also cases where a buyer is interested in buying property that has been charged to a bank, mortgage firm or other financial institutions. Such property should be avoided unless discharged and if a mortgage then the lawyer must obtain consent to ensure a smooth transfer.

Other clearances before transactions include obtaining a land rates clearance certificate from the local government and land rent clearance from the Ministry of Lands. Failure to get permission from relevant authorities has repercussions, including revocation of the transaction through a court order.

— The writer is an advocate of the High Court.

land ownership property ownership real estate
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