DEFINITION OF TERMS
Absolute title: an indefeasible title in the sense that there is no one else who can point to a better title in respect of the same object in which a proprietary interest is held.
Adverse possession: the acquisition of interest/title in land by operation of the limitation of actions statute or by effluxion of time.
Alienation: the power of an owner to dispose of any interest in land or property; the act of disposing one rights or interest in a property; sale or disposal of interests in land.
Allocation of land: Refers to the process of allocating public land to an individual or business enterprise by the government or its agency; legal process of granting rights to public land by the government or state agencies.
Allotment: an allocation of land by the Commissioner of Lands to a selected person through a letter of a letter of offer
Allottee: one who is granted an interest in land by the Government through an allotment.
Charge: A title/interest in land or lease that has been used to guarantee repayment of borrowed or loaned money. Simply using a title deed or lease document as security for a loan
Collateral: security for a loan, additional to principle security.
Compulsory acquisition: means the power of the State to deprive or acquire any title or other interest in land for a public purpose subject to prompt payment of compensation.
Consideration: the price paid or value given by a purchaser for land or a right in land.
Controlled tenancy: a tenancy for a shop, hotel or catering establishment as defined by section 2(1) of the Landlord and Tenant (Shops, Hotels and Catering Establishments) (Cap 301 laws of Kenya).
Customary law: unwritten law established by long usage. Sometimes this law is called traditional law or indigenous law.
Customary tenure: the holding of land in accordance to customary law; also Refers to land rights that are governed through customs and traditions of a people.
De-facto land holding: refer to ownership by fact or by common knowledge by people; may also be referred to as ownership in reality, in actual existence or by actual possession or as a matter of fact. Ratification of ownership through adjudication or adverse possession is actually preceded by this type of ownership.
Dejure land holding: holding land by right according to the law or ownership that is derived from lawful means. People who hold dejure rights own the land by virtue of a legally recognizable title to that land.
Development: carrying out of any works on land or making any material change in the use of any structures on land.
Disposition: means any sale, charge, transfer, grant, partition, exchange, lease, assignment, surrender, or disclaimer and includes the disclaimer or the creation of an easement, a unsufructuary right, or other servitude or any other interest in a land or a lease and any other act by the owner of land or under a lease where the owner’s rights over that land or lease are affected or an agreement to undertake any of the dispositions;
Distress for rent: the right of the landlord to remove certain goods or chattels from the possession of the tenant in order to compel him to pay the rent due;
Easements: These are partial interest on land and property which give a person a right of use of another person’s land and property without any profit or a public right of way; a non-possessory interest in another’s land that allows the holder to use the land to a particular extent, to require the proprietor to undertake an act relating to the land, or to restrict the proprietor’s use to a particular extent, and shall not include a profit.
Encumbrance: a right to or an interest in land that belong to someone other than the person having the benefit of the right or interest, which represents a burden on the land.
Forfeiture: a right to regain possession of leased or mortgaged premise, if the tenant or borrower breaches conditions contained in the agreement.
Freehold: Ownership of land and property without limit of number of years. Freehold is the greatest interest in land and property a person can have and gives the owner absolute ownership.
Holding: “In relation to tenancy”, means the property under the tenancy.
Instrument: A document which creates or effects legal or equitable rights and liabilities.
Interest: Means a right in or over land and property.
Land administration: process run by the government using private or public sector agencies related to land tenure, land value, land use, and land development.
Land register: This is the systems by which matters concerning ownership, possession or other rights in land can be recorded to provide evidence of ownership through a title.
Land Surveyors: Professionals who survey land and properties to identify their location and boundaries. Their work helps in issuance of titles. They are registered by the Land Surveyors Board (LSB) and full members of Institution of Surveyors of Kenya.
Land tenure: The relationship between people as individuals or groups, with respect to land. Refers to the way in which land rights are held; or simply, the manner of holding rights in and occupying land.
Land title: documentary evidence of a person’s right in land or ownership or ownership itself depending on context.
Land value: the worthy of a property, determined by a variety of ways to give an approximate estimate of the value.
Land: “land” means the physical location of a property or part of a property; Surface of the earth, the material beneath, the air above it and the things fixed to the soil.
Landlord: A person who leases land and property to a tenant and includes an agent or other person authorized to act on the landlord’s behalf.
Lease: a grant, with or without payment of money, by an owner of property for use of land or property by another for a period of time. Leases are either registered, unregistered, long term or short term.
Leasehold: These are interest in land for given number of years.
Lessee: A person to whom a lease has been given.
Lessor: Is same as landlord.
Matrimonial home: means any property that is owned or leased by one or both spouses and occupied by the spouses as their family home.
Matrimonial property: includes matrimonial home (s), household goods and effects in that home or any other immovable or movable property jointly owned and acquired during the subsistence of marriage.
Mortgage: Is same charge but used mostly for money borrowed to build or by a property.
Mutation: the division of land into smaller units.
Overriding interests: legal interest in land that has legal force even though not recorded in the public land register; also called statutory interest.
Perpetual rights: similar to freehold rights; that are rights to hold land for unrestricted term or forever.
Premises: A place of residence or business
Prescription: adverse possession or acquisition of rights in land by virtue of non-permissive, notorious, and continuous occupation of land for a period of twelve years.
Property manager: Professional who look after land and property on behalf of the landlord. They are registered by Estate Agents Registration Board and a member of Institution of Surveyors of Kenya.
Property: It includes land and what is developed on it.
Proprietor: In relation to land or lease, the person named in the land register as the owner or in case of a charge as the person in whose favor the charge was made.
Radical title: refers to absolute ownership rights in land by the state. All land vests and belong to the government(s) which enjoy eminent domain powers to access any land within its boundaries by compulsory acquisition. Radical title in land is gained by the government upon acquisition of sovereignty over any territory. It has been described as an ultimate or underlying or final government from which other rights to land by different entities are apportioned. It is a fundamental or comprehensive title of the state to land but does not confer beneficial but administrative and sovereign ownership.
Rectification: a change effected on the register of titles in formal matters and in the case of errors or omissions not materially affecting the interest of any proprietor or where registration was obtained, made or omitted by fraud or mistake;
Registered Estate Agent: Professionals who sell or rent land and properties on behalf of landlords or look for land and properties to buy or lease on behalf of buyers and tenants. They are registered by Estate Agents Registration Board and are members of Institution of Surveyors of Kenya.
Tenancy agreement: means a written, oral or implied agreement between a tenant and a landlord for occupancy of a residential or business premise and includes a license to occupy a rental unit. It regulates the relationship between a landlord and a tenant.
Tenancy: means a relationship created by a lease.
Tenure: The period or term of holding land; the way in which the rights, restrictions and responsibilities that people have with respect to the land are held.
Title insurance: a system for compensating people who suffer losses through a title system. The insurance can be provided by private insurers or the government through title guarantees and insurance schemes related to registration programmes.
Title: a set of facts upon which a claim to a legal right or interest is founded. Title can exist even when there is no pre-existing legal interest or right vested in person who claims he has title.
Transfer: The change of ownership of land, a lease or charge from one party to another by an act of the parties and not by law.
Transferee: A person who receives land, a lease, or a charge passed through transfer
Transferor: A person to who passes land, a lease or a charge through transfer.
Transmission: inheritance of land from a dead owner either through a will or grant of letters of administration
Trust: in common law, this is an arrangement by which legal title to property is held by one person on behalf of and for the benefit of another.
Usufruct: the restricted right by which a person is entitled to use and to enjoy the fruits of a property that is owned by another person.
Valuer: A professional qualified to assess the value of land and property. They are registered by the Valuers Registration Board (VRB) and are full members of Institution of Surveyors of Kenya.
PROPERTY AND LAND LAW
The Kenya national land policy recognizes that land administration systems in Kenya are not accessible by the poor, women, and other vulnerable groups. The policy further acknowledges the need to educate, sensitize and create wider awareness on land administration issues among the poor and vulnerable in order to empower them through knowledge and information on land administration process.
Conveyancing has been defined as the process by which legal title to property is transferred. It may thus be more appropriate to define Conveyancing as the art or science of conveying or effecting the transfer of legal property or modifying interest in relation to property by means of a (written) document. The three critical ingredients are thus the process, the legal title and the transfer or modification. The legal title or interest to be transferred or modified must be legal in the strictest sense of the word. The transferee must be seized of a legal title. Consequently, protocol or process will demand that a Conveyancer investigates and ascertains that the title to be transferred or modified is legal.
ACCESSING LAND RIGHTS IN KENYA
A sizeable number of Kenyans live and work on land, whose ownership documents they don’t have. This has made their occupation insecure, unstable and vulnerable to disputes and dispossession.
Lack of title deeds has also made many citizens unable to use their land as collateral to access capital for economic development. The historical events and patterns that have impacted land law and conveyancing in Kenya, has yielded at least three main systems of land tenure, the so called “modern” (individual) tenure, public holding and customary.
Means a grant of land by the proprietor to another party to hold for a specified period subject to payment of rent and land use and management conditions. Leasehold interest or tenure system is an estate for a fixed term of years usually in consideration of the payment of rent.
Today, the leasehold tenure system forms the basis of official policy towards land in Kenya. Individual tenure system owes its roots to colonial instruments that sought to propagate ideals of agricultural production based on individual tenure system.
The above definitions of a lease identifies three essentials of a lease without which no lease or tenancy can be created. The three essentials are: exclusive possession, determinate term, and defined premises.
A tenant must acquire the right of possession to the exclusion of the landlord and all persons claiming through the landlord. In the leading case of Street v. Mountford it was stated that in determining whether a tenancy has been granted, the essential question is whether there has been the grant of a right to the exclusive possession of the premises. If there is exclusive possession, then, provided the other requirements for a tenancy are satisfied, a tenancy will have been created.
The period of a lease must be defined or capable of being defined i.e. the term must have a beginning and a certain ending. Where the date of commencement or the date of expiry of the lease is uncertain, the transaction is void.
With respect to defined premises, it is stated in law that no lease can be created unless the property is concretely defined or capable of being defined. The rule is that no lease can be created where the frontiers of the property cannot be identified.
COVENANTS IN A LEASE
- Peace and quiet possession
- Not to abrogate from the user of the property. Not to do anything that renders the property unfit or materially unfit.
- Keep the premises in a proper state of repair, external and the structure therein.
- Fit for human habitation at the commencement of the lease and throughout the lease period.
- Suspension of rent if the premises or part of it are damaged due to natural calamity or civil commotion until the premises is rendered fit within six (6) months.
- The landlord has an obligation to pay all outings.
- Obligation to insure the premises.
- Obligation to grant consent in certain transactions without unreasonably withholding it.
- Obligation to covenant that the property would be fit for purpose.
- Pay rent reserved by the lease
- Use the property in a sustainable manner e.g where there are trees those trees should not be cut.
- Not to sub-lease or charge the property without the consent of the head lessor.
- Keep the premises in a state of good repair
- To yield up the property; Need to give up the property at the end of the lease.
- Keep the boundary marks in repair
- Allow the landlord to enter the premises upon issuance of reasonable notice by the lessor.
- Obligation to insure the contents within the property.
REMEDIES OF THE LESSOR IN THE EVENT OF DEFAULT BY THE LESSEE
The landlord is allowed to enter the premises and make the lease voidable if the lessee breaches express or implied conditions in the lease this could result as an act of omission or commission.
Forfeiture is exercised in two ways:
- Entering and remaining in possession of the premises if lessee is not in occupation.
- Exercised by court action. The lessor makes an application to the court to forfeit the In this case, tenant’s payment of rent does not act as a waiver of the landlord’s right to exercise his right of forfeiture because the right accrued way before the payment was made.
In order to exercise this statutory right, the lessor must serve a 30 days written notice of his intention to forfeit the lease and state the particular breach, require the lessee to remedy the breach within reasonable time.
Once notice has been served, lessee may apply to court for relief and the court may grant or refuse the relief. The court considers the proceedings, conduct of the parties and circumstances of each case.
Distress for rent
This remedy is applicable where lessee has not paid up the rent and it is governed by the Distress for Rent Act. If the landlord opts to distress for rent he cannot exercise eviction at the same time and the distrained goods are to remain on site for at least ten days (10 days). Once the lease expires, the landlord can still exercise distress within 6 months.
Action for recovery of rent
The landlord can sue for rent and damages. Lessee defaces the premises such that the landlord will incur costs in repair, nuisance. The landlord can also apply to court for an injunction to restrain the commission of the breach.
TERMINATION OF THE LEASE
Some remedies that the landlord exercises may terminate the lease. A lease may come to an end under the following circumstances:
- Expiry of the period of lease
- Effluxion of time
- Termination by notice
- Frustration e.g. floods
- Surrender of the interest by the tenant to the landlord
This kind of tenure system provides unlimited rights in land to use and dispose in perpetuity subject to the rights of others and the regulatory powers of the national government, county government and other state organs. These tenures apply on three main categories of land namely public, private and community land.
This system stems from the idea or notion that land belongs to the government. Public tenure, therefore, designates the government as private landowner. Government land in turn comprises of two sub-categories i.e. Unalienated and alienated Government land.
Unalienated Government land refers to Government land which is not for the time being leased to any other person or in respect of which the Commissioner of Lands has not issued any letter of allotment. In other words, these are lands vested in the Government and over which no private title has been created. The defining element of such lands is that they have not been alienated, meaning given away or ceded by the Government to another person or entity.
Alienated Government Land on the other hand, is land which the Government has leased to a private individual or body corporate, or which has been reserved for the use of a Government Ministry, Department, State Corporation or other public institution, or land which has been set aside by way of planning, for a public purpose (this latter category is usually referred to as public utility land). The defining element of alienated Government Land is that it has been reserved for the use of a Government institution or it has been set aside for the use of the public or it has been leased to an individual.
In summary, public land is all that land which is vested in the public or held under public tenure. It means all the land in which every Kenyan has an interest by virtue of being a member of the public.
Consists of registered land held by any person under any freehold tenure; and land held by any person under leasehold tenure;
Also referred to as community land this is land vested in and held by the community by law and occupation. Customary land tenure system owes its legitimacy to the traditional society where land was owned on a communal basis.
Customary land law tenure was (and is) anchored on the premise that land is much more than the physical soil. As such in many African societies, traditional philosophy ascribed a sacred significance to land. In particular land did not belong to a particular person but to God.
This explains why issues about its ownership and control are therefore as much as about the structure of social and cultural relations as they are about access to material livelihoods. This is one reason why debate about land tenure in Africa always revolves around the structure and dynamics of lineages and cultural communities rather than on strict juridical principles and precepts.
Since it was so, it meant that members of the particular community could exercise certain rights over the land in varying degrees of equality with others of the same community. In turn, that right was secured by virtue of membership in that community or more specifically by membership into some socially distinct unit of that community. Membership into a community or its unit of course required the performance of certain obligations, which in turn defined rights of access and use of land. The degree of access and use exercised by any particular member would also depend on the status of that member. In essence customary land tenure was inclusive in nature.
Adam Leach observes that there are at least five dominant concepts to most customary tenure systems, as follows:
- Tenure is family based and the head of the family holds rights on behalf of other family members.
- Individual and group membership of the social unit of production or political community have guaranteed rights of access to land or other natural resources.
- Rights of control are vested in the political authority of the unit or community.
- Private property rights accrue to individuals because of the investment of their labor in exploiting resources.
- Resources which do not require extensive investment are shared as common pasturage and managed by the relevant political authority or people with appropriate jurisdiction.
METHODS OF ACCESSING OWNERSHIP TO LAND
Land in Kenya may be acquired through any of the following processes as provided for under Section 7 of the Land Act No 6 of 2012:
- Allocation of public land;
- Land adjudication process;
- Settlement programs;
- Group ranches
- Compulsory acquisition;
- Long term leases exceeding twenty-one years created out of private land;
- Transfers; or
- Any other manner prescribed in an Act of parliamnet.
Allocation of Public Land
Section 12 of the Land Act provides that The Commission may, on behalf of the National or county governments, allocate public land by way of:
- Public auction to the highest bidder at prevailing market value subject to and not less than the reserved price;
- Application confined to a targeted group of persons or groups in order to ameliorate their disadvantaged position;
- Public notice of tenders as it may prescribe;
- Public drawing of lots as may be prescribed;
- Public request for proposals as may be prescribed; or
- Public exchanges of equal value as may be
The Act goes on to further specifically state that the Commission shall ensure that any public land that has been identified for allocation does not fall within any of the following categories:
- Public land that is subject to erosion, floods, earth slips or water logging;
- Public land that falls within forest and wild life reserves, mangroves, and wetlands or fall within the buffer zones of such reserves or within environmentally sensitive areas;
- Public land that is along watersheds, river and stream catchments, public water reservoirs, lakes, beaches, fish landing areas riparian and the territorial sea as may be prescribed;
- Public land that has been reserved for security, education, research and other strategic public uses as may be prescribed; and
- Natural, cultural, and historical features of exceptional national value falling within public lands;
- Reserved land; or
- Any other land categorized as such, by the Commission, by an order published in the Gazette.
Procedure for Acquiring Title after Allocation of Public Land
STEP1: Director of Physical Planning prepares a plan creating plots for allocation for various users.
STEP 2: Director of Surveys or private surveyor surveys the land and produces survey plan and numbering of land parcels.
STEP 3: Director of Physical Planning in conjunction with the national land commission and other regulatory agencies prepare development guidelines for the area.
STEP 4: The National Land Commission (NLC) advertises the plots for allocation or vets targeted allottees in case of special cases.
STEP 5: National Land Commission oversees the allocation of the plots to individuals using a fair and just processes.
STEP 6: The National Land Commission issues letters of allotment to qualified allottees.
STEP 7: National Land Commission prepares lease documents and executes lease documents on behalf of the National or County Government.
STEP 8: The lease document is forwarded to the district land registrar for registration and issuance of certificate of lease to the allottee.
Acquisition of title after allocation of public land can be a long and tedious process. Below we provide steps to be followed while processing your title for public land allocated to you.
|Acceptance of offer||v Write a letter to the National Land Commission accepting the offer and the conditions of the allotment.
v Make payment of the statutory fees required in the letter of allotment.
v Get a receipt for your payment.
|v Ensure your plot file has been opened by the
National Land Commission and that you have noted the number given to you.
|Surveying of the land||v Contact a registered land surveyor.
v Give him a copy of the letter of allotment together with the attached map, special conditions and receipt and instruct him to survey your plot.
v Sign a beacon certificate.
v Get details about the number and size of your plot from the licensed surveyor.
v Obtain authentic RIM and other survey details.
v Forward the survey information to the National Land Commission for preparation of lease documents.
|Preparation of lease documents||v Recording and storing survey details in catalogue.
v Reconfirming the allocation status of the land.
v Production of the lease document.
v Checking of the lease document.
v Signing of the lease document on behalf of the government by the authorized officer.
|Clearance of payment||v Assessment and payment of stamp duty at 4% of the value of the land.
v Getting rent and rates clearance certificate.
|Forwarding and registration of lease||v Forwarding of the lease document for registration to the land
v Re-confirmation of ground status by the land administrator
|v Booking of the lease documents
v Payment for certificate of lease
v Issuance of certificate of lease together with one copy of the
v lease document
LAND ADJUDICATION PROCESS
Land adjudication is undertaken under cap 284 of the Laws of Kenya. Land adjudication is defined as ascertainment and recording of rights and interest in trust/community land. Adjudication procedures convert land from customary/ defacto or common knowledge ownership to dejure or legal ownership. After the land adjudication process, a land adjudication register is created. The adjudication register is composed of a demarcation map and adjudication record. Each parcel number of land is indicated on the map which corresponds with the adjudication record that contains the registration section, parcel number, name of the owner, and size of the land and details of the registry map sheet containing the land. This information is carried on a card popularly known as green card which is inserted in a reinforced strong folder called a land register.
In some cases, the registered owner may have passed away or his/her names may have been entered wrongly in the register. In cases where the owner has passed away, the succession process will apply. While in situations where the names have been misspelt or where wrong names have been used, the ‘change of name’ procedure will have to be followed.
THE LAND ADJUDICATION PROCESS
STEP1: Land owners in the presence of the Land Adjudication Officer identify their boundaries.
STEP2: The identified boundaries are demarcated by Adjudication Officers using enlarged aerial photographs or by ground methods or by both.
STEP3: Ascertainment (and arbitration) of rights and interests in land through Land Adjudication Committees.
STEP4: Preparation of the Registry Index Map by the Director of Surveys showing the land parcels and their approximate areas.
STEP5: Preparation of a Land Adjudication Register containing adjudication section, parcel number, name of the owner, size of land and the map sheet number.
STEP6: Director of Land Adjudication signs the certificate of finality after the land adjudication officer has addressed the objections raised and the Minister of lands has determined the appeals
STEP7: The Chief Land Registrar effects registration and issues title deeds. Requirements
For the owner of land to get a title after completion of adjudication process, they need to provide the following items to land registrar:
- Their original and copy of the national identity card
- Personal identification number from Kenya Revenue Authority (KRA)
- Recent and clear passport photographs
- Ksh 500 for registration; Ksh 500 for adjudication and Ksh 250 for the title.
SETTLEMENT SCHEME PROGRAMME
Many Kenyans have been allocated land through settlement programmes. However, most of them don’t know what to do to get their titles for the land they occupy. Majority of those who failed to pay for their land have since had it repossessed. To avoid repossession and in order to acquire a title for settlement, the following steps should be followed:
STEP 1: After receiving the letter of offer (see sample in the appendix), one should accept the offer, terms/conditions and make payment as required within 90 days.
STEP 2: The letter of allotment contains the surveyed plot number and the acreage.
STEP 3: The payments should either be paid out rightly (100%) or in instalments. Note that presently, settlement land is allocated on condition that the land shall not be transferred except through the process of succession.
STEP 4: Those granted land on loan for payment in instalments should make payment to their local land settlement offices.
STEP 5: Upon completion, the officials in the local land settlement offices will inform the Director of Settlement in Nairobi.
STEP 6: After verification the Director of Settlement issues a discharge of charge (see appendix) and a transfer of land document (see appendix) which transfers the land from settlement fund trustees to the owner.
STEP 7: The Director prepares a letter which forwards this documents to the District Land Registrar for registration.
STEP 8: The owner of the land should take these two documents to the relevant district land registrar.
STEP 9: The owner will pay stamp duty, registration fees and title fees to the registrar who will issue a title deed to him/her.
CONVENTIONAL SALE AGREEMENT (WILLING BUYER, WILLING SELLER)
In the processes of buying and selling land, the seller and the buyer should follow certain prescribed procedures. . It is advisable to involve a Registered Real Estate Agent in the process. Below are steps that should be followed in different situations of buying and selling:
- Get the copy of title from the vendor or owner to conduct an official search at the District/ County Lands Office to investigate the This will establish the following, among other details:-
- The Land Registration Number or the Title Number
- The Registered Owner
- Size of the land
- Registry Map sheet Number
- Tenure details i.e. freehold or Leasehold
- Encumbrances charged to the title – Whether the land is a security of a bank loan
- Lease term and commencement date, to ascertain the remaining lease term (Usually more than 40 years is appropriate)
- Caveats and cautions restricting the sale of the subject
- Check whether the subject property is included on the Report by the Commission of Inquiry on the Illegal and Irregularly Allocated Land June 2004 (The Ndung’u Land Report).
- Search the court registries via the Kenya Law Reports (Kenyalaw.org) to ascertain whether there are any unresolved disputes that may not have been recorded in the title search certificate.
- Get a copy the National Identity Card (ID) of the seller and conduct a search of the person named in the title as the registered owner at the Registration of Persons Bureau (if in doubt of the authenticity of the ID).
- If the land is located in an urban area, conduct a search at the County Government offices to determine authenticity as well as the land rates payable and outstanding rates. Before any sale of such land, a Rates Clearance Certificate must be obtained from the Rates Department. Many people assume this part. Also confirm the user of the land, whether it is residential, agricultural, industrial etc. It’s important to note that if it is an agricultural land then a Consent Certificate from the County Land Control Board must be obtained to allow the purchase or
- Get a Survey Map, known as the Registry Index Map (R.I.M), or an FR from the County Survey office to ascertain that the said property is located on the ground as the said map. In cases where there is a sub-division on a parent plot and the same is not amended on the survey map, then a Mutation Form is acquired to ascertain the subdivisions. Where in doubt a registered Surveyor should be engaged to re-establish the beacons.
- Visit the subject property and do a general survey of the area to establish whether there are any rights of passage through the land (this is not normally recorded in the title document or map); whether squatters have built on the land as it might be costly to get rid of them; and, most importantly, whether you like it!
- Discuss with the neighbors, village elders to understand the subject property
- Village elders
- County Commissioner and
- Relatives of the owner of the property
After doing all this, it is still important to do a background check of the vendor. Check whether the vendor has the capacity to sell the land.
- If he/she is a trustee, then check the Trust Deed to confirm that he has the power to lease or sell the land.
- If it is a Limited Company, ascertain from the Memorandum and Article of Association if it has the necessary powers from its objectives to sell property. Do a search at the Companies Registry to confirm the directorship and shareholding. Note that any sale agreements should be signed and sealed by the designated directors.
- If the registered owner of the land is deceased, then ensure that the personal representatives of the deceased have Grant of Probate (Where there is a Will) or Letter of Administration (Where there is none), as stipulated in the Succession
Land can be sold in different circumstances and these include where:
Land is sold as a whole
- Upon agreeing on price, the seller and buyer should enter an agreement before a lawyer, chief or any other trusted friend.
- The seller should apply to the Land Control Board for consent to sell and to the NLC if the land is leasehold. The application should be accompanied with a current search certificate and a copy of title deed.
- The Board will require the consent of the family to the transaction.
- The Board should refuse to grant consent when it receives an objection to the transaction from the family or when the seller fails to convince them that he has more land left for use.
- Upon granting consent the seller should receive 10% of the price from the buyer to show commitment.
- The buyer and seller should fill a form of transfer on which they attach passport photos.
- The land transfer, the consent, title and spouse consent should be presented to the Land Registrar.
- The Land Registrar will pass the documents to the Land Valuer who will determine the true value of land for stamp duty purposes. The registrar will access stamp duty at 2% of the value of land or 4% for urban land.
- Upon payment of stamp duty, registration fees and title fees, the land registrar will issue title to the buyer.
Where vendor/seller has no title
While it’s advisable not to buy land where the owner has no title, many land transactions still take place without titles. This depends on the reason why the seller has not acquired a title. Many people lack titles because they have either not collected them after adjudication or they have not finished paying settlement loans. In other instances, the registered owner could have passed away and succession has not been done, or the seller could simply be an illegal occupant of the land or a fraudster.
Where the owner has no title, it’s important for that buyer to help the seller obtain the title before going through the transfer procedure. However, there should be an initial agreement between the parties to cover and aid the administration of this process of securing a title. The consensus from the family is vital in this case.
Acquisition of title through Inheritance/Succession
Inheritance of land is one of the most common ways through one can own land. However, in many cases, after the parent has subdivided land and given it to his children under customary system, the inheritors make no effort to obtain title deed. This may be because the parent didn’t have a title or they are unable to go through the tedious and expensive system of land subdivision, survey and documentation. Where the parent is able to go through the procedures and processes, then the normal sequence of land control consent-subdivision-survey-consent-transfer-title (CSSCTT) indicated above should be followed.
Land Succession Procedure
I. Acquisition of Death certificate:
Death certificate is a document used as prove of death of the proprietor of land or any other asset. The process of succession cannot commence without this prove. To obtain a death certificate one need to approach the registrar of births and deaths in their respective sub-counties armed with a burial certificate together with the deceased’s identity card and a letter from the chief where necessary. Where the death occurred before the enactment of the registration of deaths and births, the registrar will issue a confirmation of death through a letter that relies on information given by the chief and indicate the time of death.
II. Petition through Valid will to the High Court:
In case where there is a valid will, the petitioner may approach the court for grant of probate to execute the will then administer the estate in accordance with the will. A probate translates the will into an enforceable court order to be followed by the executor to the letter. It gives the executor the authority to deal with the property of deceased in accordance with the provision of the will.
III. Intestate Procedure
In the absence of a will, the process of intestacy commences. The rules of intestacy determine the question of who is entitled to the property of the estate of an intestate (person who died without a will).
In many cases, the process starts with a letter from the local Chief which clarifies the facts of the deceased’s estate and the spouses and heirs. The letter may mention liabilities where it’s necessary. Liabilities may include people who are owed money by the deceased or people who had purchased part of the land. The Chief’s letter is always addressed to the court. The Chiefs are entrusted with this mandate as they are expected to be closer to the family and hence in the know of all the relationship in the family of the deceased
IV. Filling of Petition for letter of administration intestate (Form P&A 80):
Upon presenting the Chief’s letter, searches and death certificate to the court the applicant is allowed to file an official petition or a formal request to the court to be appointed as an administrator of the deceased’s estate. The applicant does this by filling form P& A80 called petition for letters of administration intestate. This petition is either attested by a lawyer or a magistrate.
V. Filling of Affidavit in support of petition for letter of administration intestate (Form P&A 5)
This is a sworn affidavit which confirms the facts of the case, the estate and the heirs as contained in the chief’s letter. This affidavit turns the chief’s letter into a sworn statement made by the applicant (s) adoptable in law. The petitioner is required to appear before the judge in person with witnesses to confirm to the content of the petition and the claim therein.
VI. Guarantee by Personal Sureties ( Form P&A 57)
This form is filled by people who know the applicant, the estate and the heirs very well and constitutes a guarantee by the guarantors to ensure that the petitioner fulfils his mandate as promised in the petition papers.
Forms P&A 80, 5 and 57 may be collected together from the court and filled at the same time and returned to the court. One should always ask the court officials to help you fill the forms if you are not certain or if they are not represented by an advocate. The guarantors may be required to swear an affidavit to support petition before a judge.
VII. Notice in Kenya Gazette
The court upon receiving the petition papers that are dully signed and attested prepares a notification for the gazettement. The notification informs all and sundry about the petition and gives those with interest a chance to raise an objection within 30days. Upon lapse of 30 days, the petitioner may return to court to collect the letters of administration. If an objection that brings up substantive issues is raised, the petition process is halted and a full hearing of all parties together with witnesses is ordered.
VIII. Grant of letters of administration intestate (Form P&A 41)
Letters of administration may be issued to the petitioner if an objection is not raised within the stipulated period of 30 days. This gives the administrator power to administer the deceased’s estate. The administration may include completing all the uncompleted documentation for instance obtaining titles that the deceased had not obtained in his name as an administrator. When ready to dispense with the estate, the administrator goes back to the court for the final documents.
IX. Sworn affidavit by petitioner requesting for confirmation of grant
Sworn affidavit by petitioner requesting for confirmation of grant as per section 7 (2) (4) cap 160 of the laws of Kenya and indicating how the estate should be shared between the heirs and liabilities is launched. It is important that the spouses and heirs have an agreement on how the estate will be shared before filing this affidavit. It should be noted that many disputes may arise at this level concerning fairness in sharing of the deceased’s estate.
X. Notice of motion to hear the application for confirmation of grant
This are actually summons to appear before the judge by all the concerned parties to confirm that they are in agreement with the manner in which the estate has been distributed by the administrator(s). Any objection at this stage will require the parties to iron their differences and come back after consenting. Further objection may lead to full hearing.
XI. Certificate of confirmation of grant issued under Cap 160 section 7(1) and (3) (form P &A 54)
If there is agreement by all with the manner in which the estate has been distributed the court will issue a certificate of confirmation of grant which shows what each beneficiary will gets what from the estate. This grant is a court order and must be followed by all to the letter without any alterations. In of need for any change or if an omission is discovered, the orders should be taken back to the court for endorsement.
XII.Transfer of the estate to the administrator ( Form RL 19)
Form RL 19 is used to transfer land from the deceased’s name to that of the administrator upon his appointment by the high court. The form is executed by the High court Executive Officer and gives the Administrator power to administer and distribute the deceased’s estate in accordance to the agreement endorsed by the court or probate grant.
XIII. Transfer of personal representative to persons entitled under a will or on an intestacy (Form RL 7)
At this level the land is already in the name of the administrator(s). To transfer the land to the beneficiaries the administrators should obtain and fill form RL 7 which is obtained from the land registry. The forms should be accompanied by the passport photos of both the administrator and the beneficiaries together with their Identification and pin numbers. At the end of this stage everybody entitled to the estate should have their title deeds
SUCCESSION PROCEDURE WHEN TITLE IS LOST/NEVER ISSUED
Where the title has never been issued, succession procedure may use a search certificate or letter of allotment or any document indicating proprietary rights of the deceased. These documents should be appropriately certified and/or sealed by the issuing authority for them to be accepted by the court as valid. Where the title is lost the registrar of titles prepares an instrument for publication in Kenya gazette informing the public about the situation and giving them a chance to raise any objection. The wording of the gazette notice is as follows:
GAZETTE NOTICE NO—–
LAND REGISTRATION ACT 2012 REGISTRATION OF INSTRUMENT
WHEREAS Marehemu Mtu (deceased) is registered as proprietor of that piece of land known as Shamba/kichaga/44 containing 0.19 acres or thereabouts, situate in the district of Mahali, and whereas the High Court at Mahali, in succession cause no. 314 of 20 II, has issued grant of letters of administration to (I) Kijana Wake and (2) Mwingine Kijana and whereas the said land title deed issued earlier to the said Marehemu Mtu (deceased), has been reported missing or lost, notice is given that after the expiration of thirty (30) days from the date hereof provided no valid objection has been received within that period, I intend to dispense with the production of the said land title deed and proceed with the registration of the said instrument of R.L. 19 and RL. 7 in favour of Kijana Wake and Mwingine Kijana and upon such registration the land title deed issued earlier to the said Marehemu Mtu (deceased), shall be deemed to be cancelled and of no effect.
Dated the 27th August, 2020 District land registrar
ACQUISITION OF TITLE UNDER UNIQUE CIRCUMSTANCES
In law, adverse possession is the occupation of the land of another person against his wish and in opposition to his title. Where such possession continues without an interruption through eviction for a period of over 12 years, then the squatter becomes legally entitled to the land by the operation of the doctrine of adverse possession. An adverse occupier may access the land through trespass, incomplete transfer process, informal transfer process, inheritance, encroachment or fraud. The implication is that when someone occupies another person’s land against their consent and they do nothing to evict them for a period of twelve years, that person becomes entitled to ownership of the land or the portion of land occupied by him/ her. Such ownership is however only granted through filing of a petition in the high court by the adverse occupier.
For the petition to succeed the adverse occupier must satisfy the court that his occupation has been:
- Continuous and uninterrupted for twelve years or more;
- Non-permissive occupation and use (occupation and use was not permitted by the owner);
- Actual and open for the whole world to see
- Notorious, exclusive and hostile.
The adverse possession processes rests on the assumption that the true owner has either accepted the occupation of his land or has given up ownership to the occupier and that he is no longer interested in the land.
Sometimes when the government acquires a portion of land for construction of roads or other public facilities. In such a situation, the land owner is expected to push the government or the acquiring authority to survey the land, remove their portion and prepare a title for the remaining portion in his favor at their own expense.
It is governed by the Land Act, Land Regulations 2017 and the Land Act Assessment of just compensation Rules.
THE PROCESS OF COMPULSORY ACQUISITION,
- Compulsory acquisition begins with a request from the Cabinet Secretary that desires to acquire property. The government has to give a project that informs a policy, the government comes up with a policy and it is based on this policy that the Cabinet Secretary generates a request.
- Government acquiring body makes a written application to the National Land The Commission has mandate to reject the request if it doesn’t meet the required standards.
- The Commission requires that the acquiring body to confirm that they have designated funds for the project.
- Once it confirms, the National Land Commission satisfies itself that the georeferencing of the property has been done.
- Publish a 30 day (Thirty days) notice of the intention to acquire the land Form 33 in the Kenya Gazette in at least two dailies of nationwide circulation, one local (County).
- Notices of intention are affixed in the county offices and sub-counties to create wide awareness.
- Serve the notice of intention to acquire the land compulsorily to the affected persons, interested persons and the Land Registrar. Interested persons would be the registered owners, spouses, actual occupants of the property e.t.c. The Notice should contain information about proposed land use and impacts of acquisition.
- When the Land Registrar receives the notice of intention, he makes an entry of the intended acquisition in the register. This is meant to stop any dealings and or transactions in the parcel of land.
- If one wishes to enter the land, the National Land Commission gives a written authorization to do anything that is reasonably necessary. Served on the occupant a notice of 7 days. If entry causes damage, one is entitled to just compensation.
- The National Land Commission issues a Notice of inquiry to every person whose interest appears in the This notice will also be served on people who claim to be interested in the land.
- Notices of inquiry must be published in two dailies at least 15 (fifteen days) after date of inquiry. It hears and determines issues of proprietorship and claims for compensation.
- Under the Land Act, compensation can either be monetary or giving an alternative piece of land which must be of the same value of the parcel of land being compulsorily acquired.
- The National Land Commission carries out a valuation of the interest for full and just compensation.
- The National Land Commission prepares an award which shows the size, value and amount of compensation payable to the persons with interest in the land.
- This shall be served on each person with a determined interest in Form LA35 notifying the respective persons of the award and offer for compensation. Bona fide person shall be required to communicate their acceptance or rejection. If they accept, they are required to furnish the Commission with their KRA PIN, Identification Card Number and bank details.
- Where only a portion of the land is being acquired, the National Land Commission is required within 6 months to carry out a formal survey before payment of compensation.
- Payment of compensation once survey is done.
- Upon payment of compensation the owner should deliver original documents to the National Land Commission not late than 15 days from the date of compensation.
- Sign the surrender documents prepared by the Commission
- Where only a portion is registered, the Registrar registers the intended portion to be acquired in favor of the acquiring authority and the remainder in favor of the proprietor.
- If the is not fit for purpose for which it was intended, notice is issued to the Land Registrar to remove the Notice of intention to acquire from the register.
- If after acquisition the public purpose fails or ceases, the Commission has an obligation to offer the land to the first or initial owners of the property subject to the right of first refusal.
What is just compensation?
The National Land Commission makes rules to regulate the just compensation however the following rules apply as to what constitutes a just compensation in land that has been compulsorily acquired.
- It should be 15% above the market Market value of land as at the date of publication of notice to acquire.
- Any damages sustained or likely to be sustained at the date of taking possession should be factored in.
- Reasonable expenses incidental to the relocation of persons affected by the compulsory acquisition.
- The National Land Commission will not consider improvement put up after the date of publication of notice of intention to acquire the parcel compulsory.
If not happy the proprietor of the land that is to be compulsorily acquired by the government can proceed to court to determine if it is a just compensation. Further, where just a part of the land is to be acquired compulsorily and makes or render the remainder of the portion not acquired useless, the National Land Commission will compel the acquiring authority to acquire the remainder too.
Rights of the Proprietor of Land under Compulsory Acquisition
Compulsory acquisition has been defined as the power of the state to extinguish or acquire any title or other interests in land for public purpose subject to prompt payment of compensation. During compulsory acquisition the people whose land is being acquired are entitled to certain rights. Some of these rights and entitlements include:
- Expeditious, efficient, lawful reasonable and fair administrative This means that the Government or any other public authority has no right to enter any private land to undertake any development without following the due process of the law.
- The right to written notice for the action explaining clearly why it is necessary for government to interfere with your fundamental rights to land
- Right to prompt and justifiable compensation
- Right to Payment of interest on the unpaid compensation that is due
- Right to Pre-emptive rights by the original owner or their successor where the public interest in land ceases or when the Compulsory Acquisition fails.
In any case where these rights and entitlements are overlooked during compulsory acquisition process the land owner has a right to go to court and sue for remedial measures.
Title for Public Facilities
Public facilities such as schools, open air markets, hospitals, roads, open spaces and recreational parks may have secure titles. While the National Land Commission has the mandate to reclaim this land, methods of securing them for future generation must be established. Presently, there seem to be no clear, systematic way of preparing titles for public facilities. It is the duty of the affected citizens to protect these lands against any invasion by grabbers. The tentative procedure for obtaining title to such land includes:
- Conduct official search in the land registry to establish acreage and original ownership details.
- Re-confirm the boundaries of the land through fixed survey by a registered surveyor
- If the radical land ownership is registered in the name of the County Council then:
- The owners should appoint and register trustees
- The owners should approach the County Government for recommendation letter and/or execution of transfer of the land in favor of the trustees of the school;
- The total documents accumulated by the public facility trustees should include search certificate, fixed boundary confirmation map, minutes or recommendation of the county government, executed transfer form (optional), certificate of registered trustees and a letter of request to allocate to the National Land Commission or County Land Management Board (CLMB).
- The documents should be taken to the National Land Commission/ CLMB for endorsement and formal conditional allocation to the trustees through a letter of allotment;
- The National Land Commission /County Land Management Board will issue a letter of allotment in favor of the registered trustees with appropriate conditions that guard against transfer, subdivision or any other dealings.
- Title for the public facility will be prepared upon acceptance of conditions and payment of statutory fees.
- In case the land is registered in the name of an individual (this may occur in cases where land was donated or purchased but the process was not completed) appropriate action will depend on whether that individual is dead or a life.
LAND SUBDIVISION AND SURVEY
Land subdivision, survey services and development control issues play a central role in the processes of land administration in Kenya. Subdivision is provided for under the Physical Planning Act cap 286 and is specifically provided for under section 41 of the act.
The process of subdivision entails the following:
- Preparation of a subdivision on scheme by a registered planner
- Submission of the application to the County Government vide PPA 1 form
- Circulation of the plans to relevant government offices for comments and to Land Control Board if it affects Agricultural Land this is dictated by the development control policies and standards.
- Where in the opinion of a local authority an application in respect of development, change of user or subdivision has important impact on contiguous land or does not conform to any conditions registered against the title deed of property, the local authority shall, at the expense of the applicant, publish the notice of the application in the Gazette or in such other manner as it deems expedient, and shall serve copies of the application on every owner or occupier of the property adjacent to the land to which the application relates and to such other persons as the local authority may deem fit.
- If the local authority receives any objection to, or representation in connection with, an application made the local authority shall notify the applicant of such objections or representations and shall before the application is determined by it afford the applicant an opportunity to make representations in response to such objections or representation.
- A local authority or relevant statutory authority may approve the plan with or without such modifications subject to conditions as it may deem fit vide PPA 2 form.
- Submission of approved scheme to registered surveyor for Survey
- Approval of Survey by Government surveyor
- Any person aggrieved by a decision of the local authority may appeal against such decision to the respective liaison committee: Provided that if such person is aggrieved by a decision of the liaison committee they may appeal against such decision to the National Liaison Committee in writing stating the grounds of his appeal: Provided further that the appeal against a decision of the National Liaison Committee may be made to the High Court in accordance with the rules of procedure for the time being applicable to the High Court.
Restraints on Dispositions (Rights in Alieno Solo)
Restraints on title may also affect full access to land rights for realization of maximum benefits. These restraints include inhibitions, cautions and restrictions and have the effect of limiting and interfering with the land owner’s rights to full use of the land value.
A person who claims a contractual right in another person’s land can lodge a cation to forbid registration of other dispositions in the said parcel of land. A caution is a notice in form of a register to the effect that no action of a specified nature in relation to the land in respect of which the notice has been entered may be taken without first informing the person who gave the notice. Where a caution has been placed on land:
- The Registrar has discretion to accept or reject the caution if he is of the view that its unnecessary or what you try to create with a caution can be created with another instrument.
- The registrar shall give a notice in writing to the proprietor whose land, lease, or charge has been cautioned;
- If the proprietor of the land would like the caution to be removed, he is required to make an application that the caution be removed.
- A disposition which is inconsistent with the caution shall not be registered while the caution is still on except with the consent of the cautioner or by the order of the court.
- A caution may be removed by the cautioner, the court or the registrar;
- The registrar may on application of any person interested serve notice to cautioner warning that the caution will be removed at the expiration of the time stated in the notice ;
- If the cautioner would not have raised any objection at the expiry of the time stated in the notice, the registrar may remove the caution.
- If an objection by the cautioner is received, the registrar give the parties an opportunity to be heard (Registrar conducts a quasi-judicial hearing) after which the registrar will make orders which deems fit and may in the order provide for the payment of costs.
- Upon removal of caution, the registrar may refuse to accept further caution by the same person or anyone on behalf of that person in relation to same matter as a previous caution.
- Any persons who lodges or maintains a caution wrongfully and without reasonable cause shall be liable for damages and may pay compensation in case of a suit by the person who sustained the damage.
- The Registrar may refuse to register subsequent caution from the same cautioner in respect of the same property on the grounds that it is vexatious and frivolous
Restrictions are inhibitions imposed by the government or the registrar to prevent fraud, or improper dealing or for any other sufficient cause. It is also called the registrar’s caveat. Restrictions are normally placed by the registrar during compulsory acquisition or during investigation of a crime or any impropriety related to the acquisition of ownership. The effects of restrictions are similar to those of other inhibitions and the manner of removal is similar.
Restrictions may be put by the Registrar suo moto or from an intended party after having an inquiry done and notices served, the Registrar hears and makes an order restraining the dealings with the subject property.
The Registrar may remove the restriction or vary the restriction order. He can also remove the restriction if the proprietor of the property makes an application or at the behest of the court.
Inhibitions are registrable orders issued by courts of law stopping or inhibiting for a particular time, or until the occurrence of a particular event, or generally until further order the registration of not dealing with any land, lease or charge. A copy of the inhibition under the seal of the court is sent to the land registrar of land administration in Kenya for registration indicating the affected land, lease or charge. Upon registration of the inhibition, no other instrument which is inconsistent with the inhibition may be registered.
LOSS OF LAND DOCUMENTS
Where the title to land or certificate of lease is lost or destroyed the proprietor of the land may apply to the registrar for the issuance of a duplicate title or certificate of lease, and shall produce evidence to convince the registrar of the loss or destruction of the previous title or certificate of lease. The registrar shall require a Statutory Declaration to be made by the registered proprietor that that the title deed or certificate of lease has been lost or destroyed. If the registrar is satisfied by the evidence he will now ensure the information is published in the Kenya gazette and any other publication with nationwide circulation. The registrar will issue a duplicate of the lost document sixty days from the date of the first publication in Kenya gazette and national publication. If the lost title is found after the duplicate has been issued, it will be forwarded to the registrar for destruction.
The registrar also has powers to reconstruct any lost or destroyed land register after making appropriate inquires and giving notice of sixty days in the gazette.
Section 28 of the Land Registration Act, 2012 provides for overriding interests which may interfere with the enjoyment of absolute ownership interest. Overriding interests are those interests which supersede other interests in land. The law provides that: ‘registered land shall be subject to the following overriding interests as may for the time being subsist and affect the same, without their being noted on the register.
- Spousal rights over matrimonial property;
- Trusts including customary trusts;
- Rights of way, rights of water and profits subsisting at the time of first registration under this Act;
- Natural rights of light, air, water and support;
- Rights of compulsory acquisition, resumption, entry, search and user conferred by any other written law;
- Leases or agreements for leases for a term not exceeding two years, periodic tenancies and indeterminate tenancies;
- Charges for unpaid rates and other funds which, without reference to registration under this Act, are expressly declared by any written law to be a charge upon land;
- Rights acquired or in process of being acquired by virtue of any written law relating to the limitation of actions or by prescription;
- Electric supply lines, telephone and telegraph lines or poles, pipelines, aqueducts, canals, weirs and dams erected, constructed or laid in pursuance or by virtue of any power conferred by any written law; and
- Any other rights provided under any written law.
A charge is an interest in land securing the payment of money or monies worth for the fulfilment of a condition. In simple terms it means that one gives their title to the bank or any other entity as security for the money given to you. So having land can help one get money to use in any investment in form of a loan.
There are two types of charges and these are:
Informal Charge: Informal charge is a written and witnessed undertaking by the chargor to pay money advanced to him by chargee by depositing a title deed or any other ownership document with the chargor. The chargee can only possess or sell the land whose title has been deposited with him through a court order to that effect. This informal charge is also referred to as ‘lien by deposit of documents’.
Formal Charge: Is given by commercial banks through a charge document prepared after formal agreement between the bank and the applicant. One should visit a registered land Valuer for formal procedures on how to access charges from commercial banks.
The Doctrine of Priority in charges
Every charge instrument must contain term and condition of sale and consequences of default of payment and reliefs of the chargor. Charges rank according to the order in which they are registered. This doctrine therefore requires that the charge that was registered first in time takes priority over subsequent charges to the said property.
It is a fundamental doctrine that a registered charge takes priority over an informal charge.
Exceptions to the doctrine of priority
- Where you have a prior charge and a subsequent charge and the prior charge was created through fraud or misrepresentation of the chargee or the chargor, rights of the prior chargee are postponed over the subsequent chargee rights are realized.
- Exception under the doctrine of tacking. Where a chargee has created a provision that he can give further advances to a chargor on a continuing or current account, the doctrine of priority will not apply if it is noted by the Registrar or the subsequent chargee consents in writing to the further advances having priority.
RIGHT TO VARY DIFFERENT ASPECTS IN A CHARGE INSTRUMENT
The right to vary different aspects in a charge instrument are provided for under Section 84 of the Land Act. The Act provides that the various aspects or provisions that can be varied by the parties in a charge instrument include:
- Variation of interest rates
- Variation of the loan amount
- Variation of the terms which may be reduced or extended
- Variation of covenants, conditions and powers
Where it was contractually agreed upon that the rate of interest is variable, the rate of interest payable under a charge may be reduced or increased by a written notice served on the chargor by the chargee
- Giving the chargor at least thirty days’ notice of the reduction or increase in the rate of interest; and
- Stating clearly and in a manner that can be readily understood, the new rate of interest to be paid in respect of the charge.
The amount secured by a charge may be reduced or increased by a memorandum which shall:
- Be signed in the case of a memorandum of reduction by the chargee; or by the chargor; and
- State that the principal funds intended to be secured by the charge are reduced or increased as the case may be, to the amount or in the manner specified in the memorandum.
The term of a charge may be reduced, extended or renewed by a memorandum which
- Is signed by the chargor and the chargee; and
- States that the term of the charge has been reduced, extended or renewed, as the case may be, to the date or in the manner specified in the memorandum.
The covenants, conditions and powers expressed or implied in a charge are varied in the manner specified in the memorandum. A memorandum for the purposes stated above shall:
- Be endorsed on or annexed to the charge instrument; and
- Upon endorsement or being annexed to the charge instrument, vary the charge in accordance with the terms of the memorandum.
Right to discharge
The right to discharge property is a very sacred right and the chargor should be allowed to exercise this right at any time during the term or period of existence of a charge. The chargor shall, upon payment of all money secured by a charge and the performance of all other conditions and obligations under the charge, be entitled to discharge the charge at any time before the charged land has been sold by the chargee or a receiver under the power of sale.
A chargee should not fetter or clog the chargor’s right to redeem the property and any law trying to limit this right is prohibited under Section 85 of the Land Act.
A chargee may provide, in a charge instrument, that a chargor who wishes to exercise the right to discharge the charge at any time before the expiry of the term of the charge
- Shall give one month’s notice of the intention to discharge; or
- Shall pay not more than one month’s interest at the rate at which interest is payable on the principal sum secured by the charge or at any lesser rate which may be agreed, as well as paying all other money secured by the charge.
COVENANTS IMPLIED IN EVERY CHARGE INSTRUMENT THAT BINDS THE CHARGOR (BORROWER)
- To pay the principal money on the day appointed in the charge agreement, and, so long as any of the principal money or any part thereof remains unpaid, to pay interest on the money thereon or on so much of the money that for the time being remains unpaid at the rate and on the days and in the manner specified in charge agreement;
- To pay all rates, charges, rent, taxes and other outgoings that are at all times payable in respect of the charged land;
- To repair and keep in repair all buildings and other improvements upon the charged land or to permit the chargee or chargee’s agent to enter the land and examine the state and condition of such buildings and improvements at after a seven days notice to the chargor until the charge is discharged;
- To ensure by insurance or any other means that may be prescribed or which are appropriate, that resources will be available to make good any loss or damage caused by fire to any building on the land, and where insurance is taken out, it is done so in the joint names of the chargor and chargee with insurers approved by the chargee and to the full value of all the buildings;
- In the case of a charge of land used for agricultural purposes, to use the land in a sustainable manner in accordance with the principles and any conditions subject to which the land or lease under which the land is held, and in compliance with all written laws and lawful orders applicable to that use of the land;
- Not to lease or sublease the charged land or any part of it for any period longer than a year without the previous consent in writing of the chargee, which consent shall not be unreasonably withheld;
- Not to transfer or assign the land or lease or part of it without the previous consent in writing of the chargee which consent shall not be unreasonably withheld;
- In the case of a charge of a lease, during the continuance of the charge, to pay, perform and observe the rent, covenants and conditions contained in or implied by and in the lease contained and implied and on the part of the lessee to be paid, performed and observed and to keep the chargee indemnified against all proceedings, expenses and claims on account of non-payment any part of the rent or part of it or the breach or non-observance of any covenants and conditions referred to above, and, if the lessee has an enforceable right to renew the lease, to renew it;
- If the charge is a second or subsequent charge, that he chargor will pay the interest from time to time accruing on each prior charge when it becomes due and will at the proper time repay the principal money or part of it due on each prior charge at the proper time;
- If the chargor fails to comply with any of the covenants implied above the chargee may spend any money which is reasonably necessary to remedy the breach and may add the amount so spent to the principal money and that amount shall be deemed for all purposes to be a part of the principal money secured by the charge.
Remedies available to the chargee (Lender)
In the event of default or failure to pay the principal sum by the chargor (borrower), the chargee can exercise the following remedies as stated under the Act in order to recover the sums payable to the chargor. These remedies are:
- Statutory power of sale
- Appoint a receiver
- Sue the chargor for the monies due or sums outstanding
- Lease the property
- Take possession of the charged land
CHARGEE’S POWER OF SALE
The chargee has to satisfy himself that the chargor has defaulted for a continuing period of one month before issuing him with a notice to rectify the breach.
Where a chargor is in default of the obligations under a charge and remains in default at the expiry of the time provided for the rectification of that default in the notice served on the a chargee may exercise the power to sell the charged land.
Before exercising the power to sell the charged land, the chargee shall serve on the chargor a notice to sell in the prescribed form and shall not proceed to complete any contract for the sale of the charged land until at least forty days have elapsed from the date of the service of that notice to sell.
A copy of the notice to sell shall be served on
- The Commission, if the charged land is public land;
- The holder of the land out which the lease has been granted, if the charged land is a lease;
- A spouse of the chargor who had given the consent;
- Any lessee and sublessee of the charged land or of any buildings on the charged land;
- Any person who is a co-owner with the chargor;
- Any other chargee of money secured by a charge on the charged land of whom the chargee proposing to exercise the power of sale has actual notice;
- Any guarantor of the money advanced under the charge;
- Any other person known to have a right to enter on and use the land or the natural resources in, on, or under the charged land by affixing a notice at the property; and
- Any other persons as may be prescribed by regulations, and shall be posted in a prominent place at or as near as may be to the charged land.
If the Notice expires and the chargor has not rectified the breach or paid the outstanding sum, the chargee instructs the auctioneer to sale the property. Duty of care on the part of the chargee whilst exercising the statutory power of sale is paramount. The chargee therefore has a duty to obtain the best reasonable price on the property at the time of the sale. The chargee shall therefore ensure that a forced valuation is undertaken before exercising his statutory power of sale and the property cannot be sold below the reserved price.
The chargee should not sell the property at less than 75% of the market price. If chargee sells it at less than 75% of the market price, the chargor (borrower) may apply to court to declare the sale void.
Once the property is sold by the chargee it vests in the purchaser free of any encumbrance. A successful purchase during the sale is deemed to have bought it in good faith and for value and is therefore not answerable for the following:
- Misappropriation of the purchase proceeds
- No obligation to follow up on the application of the purchase proceeds
- No obligation on whether the proper process of selling was followed
The purchaser is protected even if just before completion of the sale he finds out that there was no default by the chargor and therefore the chargor’s remedy is in damages as the court won’t nullify
the sale. However, this protection is not afforded to the purchaser where the chargee (lender) was fraudulent and dishonest.
If the chargee (lender) wants to acquire the charged property, they must seek leave of the court and demonstrate to the court that they wish to acquire the property at the best price or the price they intend to pay for the property is either higher or equal to the reserved price. The chargee should provide a Court Order as evidence to the Land Registrar that they complied with Section 100 of the Land Act.
LAND DISPUTE RESOLUTION PROCEDURES AND PROCESSES
Land disputes are common occurrence regardless of the tenure system. The disputes affect all categories of land may involve issues related to land boundaries, succession, multiple ownership, un-honored sales, access to water and other natural resources, family feuds, land claims and many others. Land disputes generally relate to access to land, use of land and control of natural resources. Land disputes may occur between individuals, families, groups or communities. Land disputes have negative impacts on both social and economic lives of those involved and should therefore be resolved in efficiently and effectively.
Formal and informal mechanisms of solving land disputes include:
- Formal processes include filing litigation in courts of law or launching boundary dispute cases with the land
- Semi-informal systems include liaison committees, management committees, land control boards, and land dispute tribunals.
- Customary approaches, which are basically informal systems, have proved more successful and promising but face many adoptability and enforceability challenges.
- Alternative Dispute Resolution (ADR) measures that are able to combine customary approaches with modern innovations and This is in line with article 159 (2) (c) of the constitution which requires the judiciary to encourage the use of alternative dispute resolution (ADR) mechanisms while resolving issues including those related to land. These include mediation, arbitration and negotiation.
FORMAL METHODS OF LAND DISPUTE RESOLUTION
Land Dispute Tribunals
Land dispute tribunals were constituted under the Land Dispute Tribunal act no 18 of 1990. The land dispute tribunals were expected to use local and customary knowledge to address land disputes related to boundaries, ownership and trespass. The rulings of cases heard by the tribunals were ratified, endorsed and adopted by the high court in order to provide them with the power of a court order to aid enforcement of implementation.
The Land Tribunal Act has so far been repealed by the Environment and Land Court Act of 2011. This has however left a vacuum in dealing with local land disputes where the litigants cannot afford the high expenses and complexities associated with formal courts.
Land and Environment Court
Previously, matters related to land ownership disputes were being heard by the high courts. These cases could take a long time to conclude and take a lot of resources from the litigants. Environment and Land Court Act of 2011 has set up a specialized court for matters related to land and environment with hope of quickening the determination of land cases in Kenya. The setting up of the court is in adherence to section 162 (2) b of the constitution so as to enable the Court to facilitate the just, expeditious, proportionate and accessible resolution of disputes governed by this Act.
Boundary Dispute Determination
The repealed Land Registration Act cap 300 gave the land registrars power to hear and determine land boundary disputes. This has been retained in a different format under section 18 &19 of the Land registration Act of 2012. All boundary disputes should be reported to the land registrar for hearing and determination. Any appeal against the ruling of the land registrar may be made to the high court, land and environment court section.
Alternative Dispute Resolution Mechanisms
The Environment and Land court Act recognizes and leaves space to accommodate alternative dispute systems. It states in section 20 (1) and (2) that: (1) Nothing in this Act may be construed as precluding the Court from adopting and implementing, on its own motion, with the agreement of or at the request of the parties, any other appropriate means of alternative dispute resolution including conciliation, mediation and traditional dispute resolution mechanisms in accordance with Article 159(2) (c) of the Constitution.