The Law of Property: Summary notes

The Meaning of Property. Usually the word ‘property’ means the things which are capable of being owned, although they need not exist in tangible form. Hence in this sense the ‘property’ includes:

  1.  ‘Things in possession’ such as pens, books, desks, chairs, etc.
  2.   ‘Things in action’ These have no physical existence and include things such as debts, patents, copyrights, trade marks, shares, negotiable instruments, etc. They are called choses in action’ which can be enforced only by action and not by taking possession.

Ownership and Possession.

All legal systems distinguish between ownership and possession. It is therefore essential to deal with them briefly. Ownership is a matter of law and it denotes the relationship between a person and any right that is vested in him over property. A person is an owner of property if he has the ultimate legal right over its use and disposal. Ownership may be acquired in three ways:

  1. Originally. Where a person creates something new, or acquires some¬thing which no one claims or has been abandoned by its previous owner.
  2. Derivatively. Where a person sells his goods to the buyer or he makes a gift to another person, the right of ownership is transferred to the latter.
  3. By succession. Where the previous owner dies the property may pass to his heir or to somebody under a will.

While ownership is a matter of law, possession is a matter of fact. For example, if A obtains B’s goods by stealing or by fraud, though the goods are no more in B’s possession. his right of ownership remains unaffected, i.e. he can still enforce his right to recover them. Possession, however, is physical detention coupled with the intention to hold the thing detained as one’s own. Thus, if A throws his old suitcase into the dustbin, it indicates that he has abandoned its possession and the finder of it could become the owner without paying for Possession consists of actual possession of a thing with the intention of excluding others from appropriating it.

‘Possession is nine points of law’.

It is often said that ‘possession is nine points of law’. It means that possession is the best evidence of ownership except as against the true owner. A person, therefore, in possession of a car does not have to prove that he is the owner of the car he is driving. On the other hand, a person who disputes his ownership must establish his right over the car by pro¬ducing valid evidence of ownership.

Real and Personal Proprty.

Many legal system such as Continental and ours divide ‘property’ into movable and immovable, while English law has preferred to classify it into real and personal. Real property means land, including buildings on land and the trees and crops that grow on it, and rights over land. All other rights, for example, the right of occupancy of a house or a piece of land for a certain number of years, or a claim to be paid a sum of money at a particular time, are classed as personal property.

The distinction between real and personal property is of historical origin and is based on the different kinds of remedies available to a dispossessed per¬son. In early English common law a property was called real because if a party were deprived of his land, he could recover it specifically in a real action. Property was called ‘personal’ because an owner who had been deprived of its possession could only obtain damages.

OUTLINE OF LAND LAW

Importance of land.

A principal source of wealth in agricultural and non¬industrial societies is the land. Wealth, in such societies, is produced as a result of man’s labour applied to natural resources, and the most important of such resources is the land.

Definition of land.

Registered Land Act (R.L.A.) defines land and states that land ‘ includes land covered with water, all things growing on land and buildings and other things permanently affixed to land.’ The definition section also states that interest includes ‘absolute ownership’ but the Act does not define what is meant by absolute ownership. However, it is well established that R.L.A. uses the term ‘absolute ownership’ for freehold and ‘proprietor’ for owner.

The term ‘proprietor’ was first used in Kenya by Registration of Titles Act, 1919, whereby the owner of land is described as proprietor of a right, title or interest in land.

Classification of property under Indian Transfer of Property Act.

The Act divides property into immovable and ‘movable’ property; all property not being immovable being movable property. Section 3 of the Act, simply states that immovable property does not include standing timber, growing crops or grass.

Registration of Titles.

Certain transactions in land must be registered in order to create rights and obligations. Such registerable transactions include all conveyances, transfers, mortgages, charges and leases of long duration.

Under the Agriculture Act (Cap. 318)which controls all agricultural operations , preservation and management orders are registerable against the title of the land affected.

Under Registered Land Act, restraints on the disposition of land such as inhibitions, cautions and restrictions which are intended to restrict the proprietor’s power to deal with his interest are introduced in the proprietorship section of the register.

Under Registration of Documents Act, leaseholds, powers of attorney, wills and buildings are registerable. The Act provides for the compulsory registration of all deeds relating to land where the land has not been registered under any other Act. The drawback to the Act is, that whilst the Title Deed is registered, this does not guarantee the title of the holder of the deed. Each transaction of land is recorded in the register as it takes place.

Registration of Titles Act provides for the transfer of land by registration of titles. A certificate of title is issued to the proprietor by a Registrar of Titles. All transactions in connection with land, e.g. sale, lease, mortgage are recorded in a register of titles. Particulars of transactions are recorded and a copy of the certificate of title kept at the registry.Registration has the effect of guaranteeing the title of the holder. Section 32 of the Act is very important which states that no instrument shall be effectual to pass any interest in land until registered.

Registered Land Act ,

stipulates for the registration of titles to land and for registration of dealings in land so registered.

The Goverment Land Act, provides that the transaction with regard to a lien, mortgage or charge or transfer thereof be effected by an instrument in writing and that such instrument be registered under the Act.

Section 59 of the Transfer of Propert Act, Requires any mortgage other than a mortgage by deposit of title deed where the money secured is more than two hundred shillings to be effected by a registed instrument signed by the mortgagor and attested by at least two witnesses.

As regards leases, section 102 of Government Lands Act prescribes for registration of leases of more than one year duration.

Time Limit. Where registration is required under Government Lands Act, Land Titles Act, and Registration of Titles Act, there is no time limit within which the interests must be registered. Section 40 of Registration Land Act provides for a penalty fee when an instrument is presented for registration later than three months from the date of the instrument.

Consequences of Registration

Certain legal incidents flow from the registration of registerable transactions. Registration gives priority to a registered proprietor of registerable interest. The rights of the registered proprietor whether acquired on first registration or subsequently for valuable consideration or by order of court are free from all other interests and claims what so ever.

Priority claimed by various registered proprietors is determined by priority in presentation of the instruments for registration.

Registration of Deeds.

This gives publicity to the transactions and prevents concealed dealings. A document is given legal validity by registration. Where adjudication has been done under Land Titles Act the title adjudicated by the recorder is unimpeachable by anyone including the Government except in the case of fraud, error, omission or misrepresentation.

Section 23 of Registration of Titles Act states that the registered owner is the the absolute and indefeasible owner except in cases where he has been fraudulent and the Act provides for state indemnity in cases of deprivation of the interest.

The Effect of Failure to Register.

We have seen that certain transaction must be registered and where appropriate by deed or in the statutory form. The effect of non-registration of such transactions is that such transactions are carried out unregistered at the pains of being declared invalid.

LEASES

Leases are said to be interests conferring a right to the land itself as opposed to interests conferring a right enforceable against the land of another. The term lease includes mortgages and charges, easements, profits, licence and restrictive covenants.

Mortgages and charges have a peculiarity in that under some of their remedies such as statutory power of sale a person holds a security over another land can cause a transfer of the land and have ownership vested in a stranger and can also under the remedy of appointment of receiver and, of taking possession let out the property to a stranger until the holder of a security recovers the balance of his loan from the owner of the primises.

Definition.

Section 3 of the Registration Land Act defines the word lease as the grant with or without consideration by the proprietor of land of the right to the exclusive possession of his land, and includes the right so granted and the instrument granting it, and also includes a sublease.

Section 105 of Transfer of Property Act defines a lease of immovable prop¬erty as a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised .

Leases are dealt with under sections 106 to 117 of Transfer of Property Act and sections 45 to 64 of Registered Land Act, but Common Law applies subject to stipulations of the Judicature Act 1967.

Registration of Leases.

A lease for a specified period exceeding two years, or for the life of the lessor or of the lessee , or a lease which gives the lessee an   option to renew must be registered. Upon the registration of the lease containing an agreement, express or implied, by the lessee that he will not transfer, sub-let, charge or part with possession of the land without the written consent of the lessor, the agreement is noted in the register of the lease and no dealing with the lease can be registered until the consent of the lessor has been produced to the Registrar.

A lease may be made for a period to commence on a future date, not being later than 21 years from the date on which the lease is executed, but is of no effect unless it is registered.

When the lessee holds over, i.e. continues in possession after determination of the lease, he is deemed to be a tenant holding the land on a periodic tenancy on the same conditions as those of the lease.

Rights and Obligations. When a lease is created, certain rights vest in the lessor,e,g. the right to receive rent, and in the lessee , e.g. the right to quiet enjoyment of the premises leased. Correlative duties or obligations come into existence, e.g. the obligation of the lessor to allow quiet possession and the obligation of the lesser to pay agreed rent.

Covenants. A covenant is an agreement which creates an obligation, and which is contained in a deed. A positive covenant stipulates the performance of a certain act; a negative or restrictive covenant prohibits the commission of a certain act.

  1.  Rights and obligations, in the case of lessor and lessee, are stated in express covenants which form part of the lease.
  2.   Certain covenants, while they may not be stated expressly in the lease are, nevertheless implied.

Implied Rights of the Lessee,

  1. So long as the lessee pays the rent and observes the other conditions of thelease, he shall enjoy peaceful and quiet possession of the leased premises.
  2. Not to use any neighbouring land in such a way as would render the leased premises unfit for the purpose for which they were leased.
  3. Where part only of a building is leased, the party roof, drains, etc. to be kept in repair.
  4.   That any furnished dewelling house which is leased as such is fit for habitation at the commencement of the tenancy.
  5. If the leased premises or any part thereof are destroyed or damaged by fire, civil commotion or accident not caused by the negligence of the lessee so as to render them not fit for use, the payment of rent or part thereof is suspended until the premises are rendered fit for use, if not rendered fit for use within a period of six months, the lessee can determine the lease.

Implied Obligations of the Lessee

  1. To pay the rent reserved by the lease at the times and in manner thereinspecified.
  2. To pay all rates, faxes and other outgoings.
  3. To keep the leased premises in repair.
  4. Where the lease is of furhished premises, to keep the furniture in good condition save for fair wear and tear to replace lost or damaged articles.
  5. To permit the lessor or his agent, after reasonable notice, to enter on the leased premises and examine their conditions
  6. To repair or otherwise make good any defect or breach of agreementfor which the lessee is responsible and for which notce has been given by the lessor to the lessee, within such reasonable period as may be specified in the notice; and
  7. Not to transfer, charge, sublease or otherwise !Sart with the possession of the leased premises or any part thereof without the previous written consent of the lessor, but such consent shall not be unnecessarily withheld.

The lessor has the right to forfeit the lease if the lessee:

(i) commits any breach, or omits to perform, any agreement or condition on his part expressed or implied in the lease; or

(ii) is adjudicated bankrupt; or (iii) being a company goes into liquidation. However, before excercising the right of forfeiture, the lessor must serve notice on the lessee giving particulars of breach complained of.

REMEDIES FOR BREACH OF COVENANTS

As lease is a contract, the usual remedies available to any contractual parties are available. The parties can sue for damages, specific performance. The parties can apply for injunction to restrain a threatened breach or a continuing breach.

Action for recovery of arrears.

Under Law of Property Act, arrears of rent recoverable by action are limited to six years. An action for recovery may not be brought if the lessor has levied distress, until the property so distrained has been sold and found to be of an inadequate value.

Right of distress.

The right to levy distress is the right to remove certain property from the possession of a person in order to compel that person to perform an obligation. At common law the landlord was allowed only to re¬tain goods taken, until the Distress for Rent Act, which permitted him to sell them.

The authority to levy distress in Kenya is contained in the. Distress for Rent Act (Cap 293) and largely incorporates the English law. Section 3(1) of the Act stipulates that subject to the provisions of the Act every person having any rent or rent service in arrears and due upon any grant, lease, demise, or contract whatsoever shall have the same remedy by distress for the recovery of the rent or rent service as is given by common law of England in like case.

Distrainer.

The lessor carrying out the distress is know as distrainer . The remedy allows the distrainer to carry out distress without the necessity of co¬ourt proceedings. The actual distress is carried out by a court baliff. Under section 18(1) of the Act he must be certified in writing with authority to carry out general distress or specific distress. The baliff seizes and impounds the goods by taking them into his custody at the leased premises.

Distress could be levied not earlier than the day after rent was due, but could not be levied between sunset and sunrise, or on Sundays. Under section 4(1) of the Act, the lessee can free the goods attached next after service of notice of impounding of the goods. Thereafter the distrainer is at liberty to sell the goods for recovery of rent

MORTGAGES AND CHARGES

Section 58 of the Transfer of Property Act states that a mortgage is the transfer of an interest in specific immovable property for the purpose of se¬curing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an engagement which may give rise to a pecuniary liability.

The transferor is called a mortgagor, the transferee a mortagee; the principal money and interest of which payment is secured for the time being are called the mortgage money, and the instrument (if any) by which the transfer is effected is called a mortgage deed.

Simple mortgage.

Where, without delivering possession of mortgaged property, the mortgagor binds himself personally to pay the mortgage-money, and agrees expressly or impliedly, that, in the event of his failing to pay according to contract, the mortgagee shall have a right to cause the mortgaged property to be sold and the proceeds of sale to be applied, so far as may be necessary, in payment of the mortgage-money, the transaction is called a a simple mortgage and the mortgagee a simple mortgagee.

Mortgage by conditional sale.

Where the mortgagor ostensibly sells the mort-gaged property:

—        on condition that on default of payment of the mortgage-money on a certain date the sale shall become absolute, or

–           on condition that on such payment being made the sale shall become void, or

–           on condition that on such payment being made the buyer shall transfer the property to the seller,

The transfer is called a mortgage by conditional sale and the mortgagee a mort-gagee by conditional sale. Provided that no such transaction shall be deemed to be a mortgage unless the condition is embodied in the document which effects or puport to effect the sale.

Usfructuary mortgage.

Where the mortgagor delivers possession of the mort-gaged property to the mortgagee, and authorises him to retain such possession until payment of the mortgage-money , and to receive the rents and profits acc¬ruing from the property or any part of such rents and profits and appropriate the same in lieu of interest or in payment of the mortgage-money, or partly in lieu of interest or partly in payment of the mortgage-money, the transaction is called an usufructuary and the mortgagee an usufructuary mortgagee

English mortgage.

Where the mortgagor finds himself to repay the mortgage-money on a certain date, and transfers the mortgage property absolutely to the mortgagee, but subject to a proviso that he will re-transfer it to the mortgagor upon payment of the mortgaged-money as agreed, the transaction is called an English mortgage. This type of mortgage is used in connection with transactions registered under the Government Lands Act and Land Titles Act.

The Registration of Titles Act provides for a statutory form of mortgage as security for any sale of land registered under the provisions of the aforesaid Act. There is no conveyance of the property as under the Indian Transfer of Property

Act, but a statutory charge in the following form:

being registered as the proprietor, subject to such charges as are notified by memorandum written hereon, and to the annual rent of Shs. of that piece of land containing (state area) or thereabouts and situated in — and desiring to render the said land available for the purpose of securing to and for the benefit of (sum of money) hereinafter, do hereby charge the said land for the benefit of the said —with the sum of Shs. to be raised and paid at the times and in the manner following, that is to sa

inted for payment of the sum, etc. y (state times appo-

Signed by the above

Transfer of Property Act.

Act have the same rights and liabilities as

The charger and the charge of a legal

named in the presence of

charge under the Registration of Titles a charger and chargee under the Indian (Signature)

Difference between mortage and a charge.

The use of land as security is di-visible into the use of land as a mortgage or a charge. A mortgage is a convey-ance or assignment of land with a provision for reconvey-nce or re-assignment. When the money loaned and any interest is repaid in full, the mortgaged proper¬ty is restored by reconveyance or re-assignment of the land to the borrower.

A charge confers rights to the chargee, to enable him to recover his money plus interest, over the land as security without the land being conveyed or assigned to the chargee. On the other hand when money loaned and any interest is repaid in full , the charge is extinguished by discharging the liability of the borrower and the land thereof.

Types of Mortgages.

The important types are the legal mortgage or English mortgage, the registered charge under the Registartion of Tiltels Act, and the Registered Land Act statutory charge. They are important because each of them is possessed of nearly the basic remedies available to the mortgagee or chargee against a defaulting borrower.

Legal Mortagage. .In Kenya the Legal Mortgage is referred to in the alterna¬tive as the English Mortgage. By the English Mortgage under section 58(e) of Indian Transfer of Property Act the mortgagor binds himself to repay the mort-gage-money on a certain date and transfers the mortgage property absolutely to the mortgagee subject to the proviso that the mortgagee will retransfer it to him (ie. the mortgagor) on the repayment of the mortagage Money on the day as agreed.

Equitable Mortgage. An equitable mortgage arises when the borrower (mortgagor) deposits with the lender (mortgagee) the title deed of the property as security for the loan. When the loan has been repaid, the lender returns the title deed to the borrower. The intention was to create an equitable mortgage.

 

Rights and Liabilities of Mortgagor

  1.  right of the mortgagor to redeem (otherwise known as the equity of redemption );
  2.   right to inspection and production of documents;
  3.   right to carry out improvements to the mortgaged property;
  4. certain implied conditions specified in section 65, e.g. that the mort¬gagor will pay all public charges in respect of the property;
  5.   right, in certain circumstances to lease the property;
  6. he must not commit any act which is destructive or permanently in-jurious thereto if the security is insufficient or will be rendered insuffi¬cient by such act.

Rights and Liabilities of Mortgagee

  1.  right to foreclose the mortgage, i.e. take away the equity of redemption !by the court order, or to sell the property by court order. This will arise when the mortgagor defaults in repayment of mortgage monies.
  2.     right to sue for mortgage moneys;
  3. power of sale, subject to conditions, when the mortgage is an English Mortgage (i.e. legal mortgage).
  4. appointment of receiver;
  5. certain rights when in possession of mortgaged property, e.g. manage¬ment of property, preserve the porperty.

EASEMENTS

Easements and profits are examples of rights which one person may have against the land of another. Such rights, e.g. rights of way, rights of light, rights to ab-stract water, and rights to the support of buildings.

An easement is a right amounting to an interest in land allowing one owner of a given piece of land to use or restrict the use of other piece of land owned by another person in some specific way but excludes the former owner taking away the soil or produce or any other commodity independently capable of owner¬ship as the case concerning the right of profit.

To be valid an easement must satisfy the following conditions:

  1.  There must be a dominant and servient tenement. The land in respect of which, and for the benefit of which, the easement exists is called the dominant tenement, and the land over which the right is exercised is called the servient tenement.
  2. The easement must accommodate the dominant tenement. The easement must confer some benefit on the land itself so as to make it a better and more convenient property; it is not enough that the owner obtains some personal advantage. A right of way over contiguous land generally benefits the dominant tenement, and an easement can exist even where two tenements do not actually adjoin, provided it is clear that the ease¬ment benefits the dominant tenement.
  3. The dominant tenement and the servient tenement must not be ownedby the same person. A person cannot have an easement over his own land.
  4. The easement must be capable of forming the subject of a grant. This means the right must be sufficiently definite and must be capable of being granted by deed;

Creation of easements.

An easement is acquired by deed or prescription. The latter method is based on twenty years uninterrupted user, provided the action in the High Court claiming the easement is brought within two years of the cess¬ation of the user, if there is a cessation. An easement may also be acquired by adverse possession under the Limitation of Actions Act Cap 22 of Kenya.

The instrument creating the easement must specify clearly:

  1.  the nature of easement, the period for which it is granted and any con¬ditions, limitations or restrictions intended to affect its enjoyment; and
  2.   the land burdened by the easement and, if required by the Registrar, the particular part thereof so burdened; and
  3. the land which enjoys the benefit of easement,and shall, if so required by the Registrar, include a plan sufficient in the Registrar’s estimation to define the easement.

The grant or reservation of the easement is completed by its registration as an encumbrance in property section of the land which benefits, and by filing the instrument. An easement granted by the proprietor of a lease can exist only during the subsistence of the lease.

Profits a prendre.

A profit a prendre is the right to take something of legal value from the land of another, e.g. shooting, fishing, and grazing rights; the right to take wood for fuel. The exeception is a right to take water from a riverwhich is treated as an easement because running water cannot be privately owned and is not therefore a thing of legal value.

A profit necessarily involves a servient tenement but there may or may not be dominant tenement, for a profit can exist in gross. A profit may be a several profit, where enjoyment is granted to an individual as often the case with shoot¬ing and fishing rights; or a profit may be in common which may be enjoyed by more than one person, as is often the case with grazing rights and the right to take various materials for use as fule.

Termination or Extinguishment of Easements and Profits.

They may be extinguished by statute, or by express or implied relaease. At law a deed is necessary for express release, but in Equity an informal release will be effective if it would be inequitable for the dominant owner to claim the right still exists.

If the dominant owner shows by his conduct an intention to release an ease¬ment, it will be extinguished. The demolition of a house to which an easement

of light attaches may amount to an implied release, but not if it is intended to replace the house by another building.

Restraints on Disposition

A person other than the proprietor may protect his land interest in the land of the proprietor by means of a restraint on disposition of land. A restraint either estops or delays dealings on the proprietor’s land. They are registerable against the property by the third parties and are part and parcel of registered conveyancing.

The Registered Land Act makes provision for three different types of restraint which can be registered against a title which prevents the owner from disposing of the property.

Caution. This is known under the Government Lands Act, Land Titles Act and Registration of Titles Act as a caveat. In the Registered Land Act, it is known as a caution. They are both similar in effect.

Any person interested in the registered land may lodge a caution with the Registrar against any dealing with that land. Entry of a dealing with such land may not then be made unless the cautioner has received notice. Lodging of a caution Without reasonable cause can lead to a remedy in damages.

A caution can be removed by the cautioner, or by order of the court or by order of the Registrar.

Inhibition.

These are equivalents of prohibitory orders under the other Acts. Under section 128(1) of Registered Land Act, the court may make an order in¬hibiting for a particular time, or until the occurrence of a particular event, or generally until a further order, the registration of any dealing with any land, lease or charge. So long as the inhibition remains registered, no instrument which is inconsistent with it can be registered.

Any person entitled to the order may register the inhibition provided he obtains a copy of the inhibition duly sealed by the court. Under these circumstan¬ces the Registrar has no alternative but to register the inhibition by complying with the court order.

Provision is also made in the Act for the inhibition to be cancelled in the following cases:

  1. On the expiration of the time limited by the inhibition; or
  2. On proof to the satisfaction of the Registrar of the occurrence of the event named in the inhibition; or
  3.   On the land, lease or charge being sold by a chargee unless such sale is itself inhibited; or
  4. By order of the court.

Restriction.

Under section 136(1) of Registered Land Act, for the prevention of any fraud or improper dealing or for any other sufficient cause, the Registrar either with or without the application of any person interested in the land, lease or charge, after directing such inquiries to be made and notices to be served and hearing such persons as he thinks fit, may make an order prohibiting or restricting dealings with any particular land, lease or charge.

The Registrar must give notice of a restriction to the proprietor affected thereby. So long as any restriction remains registered, no instrumet which is In¬consistent with it shall be registered except by court order or of the Registrar. There is a similar power contained in the Registration of Titles Act.

Under section 138 of Registered Land Act, the Registrar may at any time upon application by any person interested or of his own motion, and after giving the parties affected an opportunity of being heard, order the removal or variation of a restriction. The court may also order a restriction to be removed or varied or make such orders in its discretion and may thereby award costs

GIFT OF MOVABLE OR IMMOVABLE PROPERTY

‘Gift‘ is the transfer of certain existing movable or immovable property made voluntarily and without consideration, by one person, called the donar, to another called, the donee, and accepted by or on behalf of the donee.

Such acceptance must be made during the lifetime of the donar and while he is still capable of giving. If the donee dies before acceptance, the gift is void.

Transfer how effected.

For the purpose of making a gift of immovable proper¬ty, the transfer must be effected by a registered instrument signed by or on be¬half of the donar, and attested by at least two witnesses. For the purpose of making a gift of movable property, the transfer may be effected either by a regis¬tered instrument signed as aforesaid or by delivery. Such delivery may be made in the same way as goods sold may be delivered.

TRANSFER OF ACTIONABLE CLAIMS

The common law does not recognise the transfer (or assignment) of actionable claims (i.e. choses in action), but this is now possible by virtue of section 130 of Law of Property Act.

To be effective such an assignment (transfer) must be absolute and not partial; must be in writing signed by the assignor; and must be notified in writing to the debtor, generally by the ‘assignee.

If the above requirements are complied with, the assignee can sue the debtor without making the assignor a party to the action. Failure to give notice to the debtor means that there is no legal assignment; the debtor can validly pay the

assignor, and the assignee is laible to be postponed to a later assignee for value who notifies the debtor.

Assignments are said to be ‘subject to equities’ the person to whom the right is transferred takes it subject to any right of setoff which was available against the original assignor. So if X assigns to Z a debt of Shs. 1,000 due from Y, and

X also owes Y Shs. 200, then in action brought by Z for money, Y can set off the debt of Shs. 200.

CONVEYANCING

A conveyance is said to be the deed by which the owner of a freehold property whose title is subject to the deeds registry transfers ownership of it to the pur¬chaser. If the property is a leasehold, the deed is called an assignment.

The distinction between transfer or conveyance lies between whether the title to the property is registered under the deeds register or the land register. The land register is a register of property with a registered state guaranteed title.

Transfers. Section 5 of the Indian Transfer of Property Act defines transfer of property’ to mean an act by which a living person conveys property in present or in future, to one or more other living persons, or to himself and one or more living persons .

In this section ‘living person’ includes a company or association or body of individuals, whether incorporated or not, but nothing herein contained shall affect any law for the time being in force relating to transfer of property to or by companies, associations or bodies of individuals.

Registration of Titles Act, defines the word ‘transfer’ with regard to land or chargeias the passing of such land or charge by an act of parties and not by operation of law, and also the statutory instrument by which such passing is effected.

Registered Land Act, defines the word ‘transfer’ with regard to land or charge as the passing of such land or charge by an act of the parties and not by oper¬ation of law, and also the statutory instrument by which such passing is effected.

Land registered under the Government Lands Act being governed by English conveyancing forms, transfers or ownership are made by deed by way of convey¬ance in regard to freehold land and by assignment in regard’ to leaseholds, in accordance with the requirements of the Real Property Act, 1845. The Regis¬tration of Titles Act, and Registered Land Act provide simple forms of transfer under hand only without the necesaary of recitals, seal or the other technicalities of a deed.

Under the Registration of Titles Act, the interest of the transferor is transfe¬rred both by section 39, R.T.A. and by section 8 of Indian Transfer of Property Act. Under the Government Lands Act, the interest of the transferor is conveyed by section 8 of Indian Transfer of Property Act, only, which conveys the whole interest of the transferor.

Under the Registered Land Act, section 27 transfers the whole interest of the transferor. Under section 10 of the Indian Transfer of Property Act, and section 88(1) of Registered, Land Act, as the right to transfer is a necessary incident to the beneficial ownership of property, any condition absolutely restraining the transferee from dealing with the property is void, but a partial restraint is not.

Section 88 of Registered Land Act also invalidates any condition or limitation (other than a trust for sale or wakf) purporting to determine the interest of the transferee on the happening or non-happening of a future event or containing a direction (other than an easement, profit or restrictive covenant) directing that the land shall be used in a particular manner. This is substantially covered for Government Lands Act, and Registration of Titles Act, and by sections 11 and 12 of Indian Transfer of Property Act.

Section 87 of Registered Land Act, provides that a transfer shall not be ex¬pressed to take effect on the happening of any event or’on the fulfilment of any condition or at any future time, from which it is clear that any interest must be vested in possession from the moment of creation.

Co-ownership. Two persons may own land simultaneously. In such a case they are joint tenants or tenants in common. Where they are joint tenants there is no question of a share of the property  each is the owner of the whole. Where there

is a tenancy in common, each is regarded as owning an individual share in the pro-perty, but that share has not positively marked out. Tenants in common hold property in undivided shares.

A joint tenancy arises where land is conveyed to two or more persons and no words of severance are used. A tenancy in common arises when there are words of severance. Thus a conveyance ‘to A and B’ would create a joint tenancy, whilst a conveyance ‘to A and B equally’ would create a tenancy in common. The right of survivorship orjus accrescendi is a distinguishing feature of joint tenancies, and upon the death of one joint tenant, his share in the property passes to the survivors until there is only one person left and he becomes the sole owner of the property. The jus accrescendi does not apply to tenancies in common and such a tenant may dispose of his share by will.

Advantages and disadvantages.

Both types of co-ownership have advantagesand disadvantages. The jus accrescendi as applied to joint tenancies prevents toomany interests being created in land, because a joint tenant cannot leave any partof the property by will and so the number of interests decreases. When the land is sold the number of signatures on the conveyance will not be excessive.

On the other hand joint tenancies are unfair in that eventual sole ownership depends merely on survival. Where there is a tenancy in common, each tenantcan leave his interest by will dividing it between two or more persons, thus the number of interests increases and on sale many interests must be got in.

The Registered Land Act specifically recognizes ownership either ‘jointly’ or ‘in common’. Section 101 (1) states that all instruments relating to co-owners shall show whether they are joint tenants or tenants in common and in relation to the latter the share of each. This is to avoid the position under the early Registration Acts where co-owners are often registered without there being any clear indication of the nature of their co-ownership.

The Indian Transfer of Property Act makes no reference to joint tenancy or tenancy in common. Section 45 provides that if there is a purchase by two or more persons they share the property in the shares they advanced the purchase money; and section 46 of the Act provides that on a sale the proceeds are divided in accordance with the shares they held in the property.

In countries where land is commonly inherited by all the sons of a land owner, when a scheme of registration is applied all the sons on inheriting the father’s land are registered as tenants in common. They in turn leave their respective sh-ares in the land to all of their own sons. In order to prevent this the Registered

Land Act limits the number of co-proprietors who can be registered against any title in the Trust Lands to five. Under the Act the Minister is also given power to make order applicable to any part of Kenya limiting the number of co-proprietors.

Trusts

Upto 22nd December, 1941, equitable interests and trusts of land were recognized in Kenya and settlements were created under English common law and rules of equity prevailing on 12th h August 1897. Onall that d tsate the Trusts of Land Act came into force and by itssections 10 to 12 trusts of land then subsisting were converted into trusts for sale.

The Act provides that any attempt after that date to settle land in Kenya will result in the creation of a trust for sale. The land is vested in the trustees for sale on an immediate binding trust for sale with power to postpone sale and the beneficiaries’ interests are limited to the proceeds of sale only.

Under/the Act a purchaser of land from the trustees for sale is not concerned with the trusts affecting the proceeds of sale at all and he gets a good receipt for the purchase money if he pays to :

(i) a trust corporation

(ii) at least two trustees

(iii) a sole or surviving personal representative acting as such.

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