What is a Land Sale Agreement?
This is a legally binding document between two parties (that is a seller or vendor and a
buyer or purchaser) that clearly outlines the terms and conditions for the sale of land. This article outlines most of what you need to know about a land sale agreement in Kenya.
Why should parties sign a land sale agreement?
The Laws of Kenya and in particular the Law of Contract provides that all land
transactions must be in writing, must be signed by all parties and their signatures
witnessed and thereafter stamped at the lands registry to ensure legal compliance and
validity binding the parties.
The Agreement can be enforced in law as valid in the event of fraud, breach of terms, or
for other reasons that may lead to failure of the Agreement.
Without a written, signed and stamped Sale Agreement, the affected party will find it
difficult or impossible to prove to a court of law that any agreement regarding the sale of
land existed.
Can the involved parties prepare the Sale Agreement by themselves?
The parties may prepare the Sale Agreement by themselves but it is always advisable
to hire an Advocate to draft and interpret the laws governing land transactions in Kenya.
To prevent a possible conflict of interest, it is equally advisable for the buyer and seller,
to each have their own Advocate in the land transaction.
What should a buyer do before signing a Land Sale Agreement?
The buyer must conduct due diligence which is an initial critical step when buying land
in Kenya. This process allows the buyer to gain a detailed understanding of the
parcel(s) of land and confirm that the acquisition is a good idea.
Identify the land to determine the size, location, budget and purpose of the land that you
need to buy.
Conduct a physical visit to check the layout of the land and its surrounding area. Interact
with the locals and neighbours, and ask about the history of the land. This will help the
buyer identify any disputes over the land, family squabbles, and boundary disputes over
the land they are interested in.
If dealing with a registered agent, ensure that the agent has the authority to sell the
property. Meet the registered owner(s) and request for their National Identity Card or the
company registration certificate (if the registered owner is a company), their KRA PIN
Certificate and the original and certified copies of the property’s title deed.
Conduct a land search at the relevant lands office by filling in the search application
form, providing a certified copy of title, identification documents, and a copy of the KRA
PIN certificate. Once processed, the lands office will issue you with a search report
revealing the current registered owner(s) of the property and the duration of their
ownership and the current encumbrance(s) if any, against the title deed like bank loans
or court judgements by any interested parties.
What are the essential components of a standard Land Sale
Agreement in Kenya?
- The details and description of the parties to the Agreement including their names,
postal addresses and National Identity numbers. - The description of the land: which includes its location and size, the registration
number, any fixtures on the land including any building or erection, boundaries
and encumbrances, if any. - The buying price of the property: including the terms and conditions of the
payment eg. Whether payment is made in full or more commonly a deposit
followed by installment payments, the financial modalities where a financier is
involved, the agreed buying price and the duration of payment. - The duties and responsibilities of the buyer and the seller.
- Dispute Resolution Mechanism: How the parties intend to resolve any dispute
that may arise between them concerning their Agreement. - Completion details: Completion in land transactions means the conclusion of the
land sale which is signified by the buyer paying the full purchase price and the
seller providing all the documents to the buyer including the original title
document, duly executed land transfer forms, land rates clearance certificate,
consent of the land control board (if applicable), seller’s KRA PIN and Identity
Card and if there is any encumbrance on the land, there ought to be proof of
payment. Together with the completion date which is a date specified in the
Agreement when both parties are required to fulfill their obligations under the
contract. - Execution: The parties to the Agreement must whether individuals or in case of a
company (the company’s representatives such as directors) must sign the
Agreement in the presence of a lawyer.
Please EMAIL us at legal@ombogo.co.ke or CONTACT us on +254 703 741276
if you need an Advocate to represent you in the purchase or sale of land.
