Land Law and You – Costly mistakes from failing to do a proper due diligence
Buying property is a big investment and you always need to do a thorough due diligence to find out as much as you can when buying a property. In our previous post What Are You Buying, we talked about how important it is to do the right checks at the relevant public registries to confirm the state of the property. It is equally crucial that you visit the property as well. If you find people occupying the property and they are not the owners of the property, make sure you understand why and how they have come to be there. The landowner must be able to answer these questions:
· Are the occupants tenants?
· Is there a lease agreement in place?
· How much notice will they have to be given in order to vacate?
· Do they have a right to stay in the property?
You may find that the occupants are tenants who can be given notice to vacate. Or you may find that the occupants actually have an interest in that property that gives them certain rights to stay right where they are. So, if you fail to visit the property and ask these crucial questions, you could be endangering your property purchase.
In the case of NAWAKWI v LUSAKA CITY COUNCIL the court said that purchasing of real property cannot be taken as casually as purchasing household goods! In this case, Ms Nawakwi bought a council house at the time when the council was selling its houses to sitting tenants. Mrs Sikanyika, the sitting tenant, applied to buy the house she was occupying and was denied. Ms Nawakwi, a minister at the time, applied to buy the same house on the same day and her application was approved. Mrs Sikanyika took the matter to court and it went all the way to the Supreme Court.
In the Supreme Court, Ms. Nawakwi’s lawyer argued that she was a bona fide purchaser who had no idea the property had a tenant who had an interest in the property. They argued that Lusaka City Council should offer Mrs Sikanyika an alternative house. The court dismissed this argument and said, ‘[Ms. Nawakwi] ought to have made inquiries and to have visited the place before going ahead with the purchase. She deliberately or carelessly abstained from making inquiries that a prudent purchaser would have made. Purchasing of real property cannot be taken as casually as purchasing household goods… She knew of the existence of…the tenant… or if she did not know this court must take her to have had “constructive notice” of the…tenant”. In other words, if she didn’t know of the tenant she ought to have known of the tenant by having gone to the property and making proper inquiries.
Avoid making costly mistakes when you’re buying property! Engage recognised professionals at home to undertake a due diligence for you. Don’t take a chance and ask family members to do this for you as they may not understand the legal implications involved. Our professional advisors can make sure the property you’re buying is vacant or will be vacant by the time you’re completing your purchase. Contact Diaspora Connect for more information.