Trinidad and Tobago 2012 - invesTT

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Trade and Investment Approvals and Procedures Contracts for Sale and Purchase of Land In the case of an agreement for the sale of land, Trinidad and Tobago law prescribes that the agreement must be in writing and duly signed by the parties (the Vendor and the Purchaser). There is no fixed form of contract but, at the very least, the property, price and parties must be identified. The contract usually also provides for the payment of a ten percent (10%) deposit on the purchase price and the balance in a certain period of time (normally ninety (90) days). A clause is commonly inserted allowing for the deposit to be forfeited by the vendor if the purchaser fails to complete the purchase within the stipulated time except where this is due to the vendor’s default. Where a real estate agent is employed to sell land on behalf of an owner, the agent often prepares the Agreement for Sale. It is advisable, however, that the purchaser ensures that the agreement is approved by an attorney before he signs it. Alternatively, the attorney may prepare the agreement. Where a real estate agent has been retained by the owner, a commission is payable by the owner amounting to 3% to 5% of the purchase price. further period of eighteen (18) months. The application is stated to be a simple process. There will be two (2) exceptions to the new land use policy: • The Government will also reserve the right to prioritise the use of land for particular investments or sectors. • Issues relating to land ownership in Tobago will fall under the purview of the Tobago House of Assembly (THA). The THA may impose additional requirements related to land ownership which are not inconsistent with what is stipulated in the investment policy e.g. restrictions on the length of ownership before resale and the type of activity to be undertaken on the land. Land Title Systems There are two (2) systems of law under which land is held in Trinidad & Tobago: • The old law or common law system of conveyancing • The Torrens system of registered conveyancing or the Real Property Ordinance (R.P.O.) system of conveyancing. Most of the land in Trinidad and Tobago is still held under the old law system. This is the system which is based on the English common law as modified from time to time by statute such as, for example, the Conveyancing and Law of Property Ordinance (Chapter 27 No. 12). 56
A GUIDE TO INVESTING IN TRINIDAD AND TOBAGO (2012) Section 5 This is the system of registration of deeds relating to the transfer of land. The original deeds are lodged at the Deeds Registry of the Registrar General’s Department and searches are conducted at that department, to trace the vendor’s title or determine how the vendor acquired ownership of the land or property being sold. The purchaser’s attorney or his search clerk prepares what is called an Abstract of Title consisting of a list of documents, facts and events setting out the history of ownership of the property and all dealings with the property over a period of at least twenty (20) years. The first document contained in the abstract is called the Root of Title and thereafter, for good title to be constituted there must be in chronological order, a chain of title that continues from the root to the vendor, free from all encumbrances and without any break. Title to property is either freehold or leasehold. In the case of the latter, the term of years can vary from periods of 25 years to 999 years. The R.P.O. system is based on the Torrens System (after Sir Robert Torrens). In Trinidad and Tobago, the R.P.O. system exists side by side with the old law system, and it is not uncommon to find one property consisting of lands held under both systems. All dealings with land or property under the R.P.O. system are endorsed on a document called a Certificate of Title, the original of which is kept in the R.P.O. Registry of the Registrar General’s Department, and the duplicate of which may be withdrawn from the registry and held by the owner of the property or by anyone else (e.g. a bank) who may have an interest in it. Under the R.P.O. system, once a person’s interest in property has been endorsed on the Certificate of Title, that interest is said to be indefeasible, that is, backed by a Land Assurance Fund against which any person who has been fraudulently deprived of his interest in land can claim compensation and to the extent of any shortfall in the fund, the claim is guaranteed by the Government of Trinidad & Tobago as a charge on the Consolidated Fund. The Procedure Involved in the Transfer of Real Estate In order to facilitate the smooth and timely conclusion of a purchase transaction, the parties concerned are required to submit to the attorney preparing the transfer documents copies or the originals of the following where applicable: • The Contract for Sale signed by the parties i.e. the Vendor and the Purchaser • The Deed by which the Vendor acquired the property, or the Certificate of Title if the property is held under the R.P.O • Releases of all outstanding mortgages on the property together with statements from the mortgagees as to the amount required to effect the releases and a note on the legal costs incurred in preparing such releases • Current receipts for water and sewerage rates, Water and Sewerage Authority (WASA) Clearance Certificate, Land and Building Taxes, Land Rent and Condominium Management Charges • Planning approval for development, if the property is to be developed by the Vendor before completion of the sale (or has recently been developed) As soon as the relevant documentation is received, the attorneys will engage the services of a Search Clerk to conduct a search of the records at the offices of the Registrar General. These searches will indicate the history of ownership of the property and verify whether the property is subject to any, and if so, what encumbrances. On 57
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