Property Law in Pakistan

Property is the thing or group of things that belongs to a person. It can be physical, like a house or car, or intangible, like a patent or copyright. Property is protected by the government, which gives the owner the right to use it and exclude others from using it. The right to own, use, or dispose of something. The right to possess, enjoy, and dispose of a thing. The highest right someone can have to anything. Property refers to the thing itself or the rights one has in a thing. Land, and any structures or fixtures permanently attached to the land, like buildings, fences, or things attached to the buildings, like light fixtures, plumbing, or heating fixtures. The term is generally used interchangeably with real property

WHAT IS THE AMOUNT OF MAINTENANCE AMOUNT PAYABLE PER MONTH TO THE CHILD BY THE FATHER?

Transfer Of Property

Property can be transferred to other persons under specific conditions that are outlined in the Transfer of Property Act. This act defines certain modes where transfer takes place through an agreement between the parties involved. The modes of transfer are as follows:

MODES OF TRANSFER

1- By act of parties
2-By operation of law
3-Transfer of Property Act 1882 only deals with those transfers that take place by the act of parties.

TRANSFER OF PROPERTY BY ACT OF PARTIES

Property can be transferred to the other person with or without certain condition. Transfer of Property Act defines certain modes where transfer takes place by act of the parties that are enlisted as follows:
1-Sales
2-Mortgages
3-Leases
4-Exchanges
5-Gifts
6-Transfer of Actionable Claims

RIGHTS THAT MAY BE TRANSFERRED

1-Spes Successionis (chance of succeeding to an estate)
2-A mere right to take back the land (right of re-entry) given on lease to another for breach of a condition
3-An easement
4-An interest meant to be personally enjoyed by the person to whom it was given
5-A right to future maintenance
6-A mere right to sue for damages for breach of contract or tort
7-A public office
8-Pensions and stipends
9-Transfer of property for unlawful object or consideration
10-Occupancy rights.

PERSON WHO CAN TRANSFER A RIGHT

The person who is competent to transfer a right must be of sound mind and body, and must be the full owner of the property or legally authorized to transfer it on behalf of the person having title to the property. The person who transfers a right is called the "transferor" and the person to whom transfer is made is called the "transferee".

ABSOLUTE TRANSFER

When property is transferred, the person who is doing the transferring (the transferor) passes on to the person receiving the property (the transferee) not only all the interest in the property that the transferor has at the time of the transfer, but also any legal rights or incidents (such as easements) that go along with the property. For example, if a house is sold, any easements attached to the house are also transferred to the new owner.

ORAL TRANSFERS

Unless the law requires it, a transfer does not have to be in writing to be valid. If the transferee is absolutely restricted from disposing of their interest in the property, that condition is void. Leases are an exception to this rule.

CONDITIONS RELATING TO TRANSFERS

If the transferor creates an absolute interest in the transferee, any direction that such interest shall be enjoyed by the transferee in a particular manner is void. However, such a condition would be valid if it is imposed for the benefit of the transferor's adjoining land. A condition that would make interest determinable on subsequent insolvency or attempted alienation is void.

CONDITIONS THAT CAN BE IMPOSED

A condition precedent can be imposed - meaning, a condition which must be performed before the transferee can take the property. But such conditions must not be impossible, or against the law in any way, or fraudulent, or involve or imply injury to another person or their property, or be considered immoral or go against public policy. A condition precedent shall be deemed as being fulfilled if it has been complied with to a large extent (although not completely). A transfer of interest may be made on the condition that in the event a specified uncertain event happens or does not happen, the interest will pass to another person. A condition subsequent that has the effect of divesting an estate is subject to strict construction, which means the condition must be fulfilled strictly. Interest may be created with the condition that it will cease to exist if a specified uncertain event happens or does not happen.

TRANSFER IN FAVOR OF AN UNBORN PERSON

A transfer of property to an unborn person (i.e. someone who hasn't been born yet) can be created by a living person, provided that the transferor has the intention to transfer their entire property to the unborn person. The interest created in favour of the unborn person will only come into effect once the person is born, and if they're born before the termination of any prior estate.

TRANSFER OF PROPERTY BY WAY OF SALE

According to the Transfer of Property Act 1882, "Sale is a transfer of ownership in exchange for a price paid or promised". Transfer by sale is effected by one of the following methods: - by delivery of possession if the tangible immovable property is less than Rs. 100 in value; - by registration in all other cases

RIGHTS AND LIABILITIES OF BUYER AND SELLER

Disclosing any material defects in the property or in their title to the property;
Producing title deeds;
Answering questions regarding the title;
Executing conveyance;
Taking care of the property between the date of contract and delivery of the property;
Paying outgoings, i.e. public charges, rents, etc., up to the completion of sale.
The seller's liabilities after completion of sale are:
Covenanting for the title;
Delivering documents of title; and
Giving possession.
The buyer is responsible for:
Disclosing anything that materially increases the value of property;
Paying for the property.
Buyer's responsibilities after purchase:
The buyer is only liable for losses from the date of the purchase;
The buyer must pay the principal and any interest that accrues from the date of the purchase.

PRINCIPLES APPLICABLE TO THE MORTGAGE

DOCTRINE OF REDEMPTION

The mortgagor has the right, upon tender of the mortgage money at a proper time and place, to require the mortgagee to deliver the mortgage deed to him, deliver possession if given, and transfer the property to him.

DOCTRINE OF FORECLOSURE OR SALE

Section 67 of the Transfer of Property Act states that foreclosure is the right of the mortgagee. This means that if the mortgagor fails to pay the mortgage money within the specified time period, they would be prevented from claiming back the property. This would result in the mortgagee becoming the owner of the property. This doctrine does not apply to simple mortgages; it only applies to mortgages with conditional sales.

CONCEPT OF MARSHALLING SECURITIES

If the owner of two or more properties mortgages them to one person and then mortgages one or more of the properties to another person, the subsequent mortgagee is, in the absence of the contract to the contrary, entitled to have the prior mortgage-debt satisfied out of the property or properties not mortgaged to him, so far as the same will extend, but not so as to prejudice the rights of the prior mortgagee or of any other person who has for consideration acquired an interest in any of the properties.

CONCEPT OF SUBROGATION

Subrogation is a legal term that refers to the right of one party to replace another party in an agreement or contract. This usually happens when the first party pays off the debts of the second party, and in doing so, acquires all the rights that the second party had under the original agreement. In other words, subrogation is a form of substitution. When a subsequent mortgagee pays off a prior mortgagee, he or she is subrogated to the rights of the prior mortgagee.

CHARGES

In a charge, there is no transfer of property but the creation of a right to payment from specified property. In a mortgage, there is a transfer of interest. A mortgage is good against subsequent transferees while a charge is only good against subsequent transferees with notice.

TRANSFER OF PROPERTY BY WAY OF LEASES

The Transfer of Property Act defines lease in section 105. A lease is a transfer of the right to enjoy a piece of property, made for a certain time period or in perpetuity, in exchange for consideration. The lessee (the person who accepts the transfer) agrees to pay the lessor (the person who makes the transfer) a price periodically or on specified occasions.

FORMS OF LEASE

The three most important types of leases are periodic, perpetual, and bemiadi leases. Periodic leases have a set term, after which the lease expires. Perpetual leases do not expire, unless the property is sold or leased to someone else. Bemiadi leases do not have any set term or period.

DISTINCTION BETWEEN TENANCY AND LEASE

The key difference between a lease and tenancy is not how rent is paid, but rather the length of time for which the property is rented out. A lease is when a landlord rents out their property for a set period, while in the case of tenancy, the occupier holds the property until it is terminated either expressly or by implication.

EFFECT OF HOLDING OVER

Once the lease has been determined, the lessee is allowed to stay in possession of the property and the lessor agrees to this continuing arrangement. This understanding is usually shown by either the lessor accepting rent from the lessee or through other actions. Consequently, a new tenancy is established.

TRANSFER OF PROPERTY BY MEANS OF EXCHANGES

An "exchange" is a transaction that occurs when two people mutually agree to transfer the ownership of one thing for the ownership of another thing. This can be anything - not just money.

EXCHANGE OF MONEY

On an exchange of money, each party thereby warrants the genuineness of the money given by him.

TRANSFER OF PROPERTY BY GIFTS

Section 122 of the Taxation Property Act defines a gift as a voluntary transfer of certain existing property, movable or immovable, from one person (the donor) to another (the donee), without consideration. The gift is accepted by or on behalf of the donee.

TRANSFER HOW EFFECTED

For the purposes of making a gift of immovable property, the transfer must be effected by a registered instrument signed by or on behalf of the donor and attested by at least two witnesses. For the purposes of making a gift of movable property, the transfer may be effected either by a registered instrument signed as aforesaid or by delivery. Such delivery may be made in the same way as goods sold may be delivered.

GIFT OF EXISTING AND FUTURE PROPERTY

A Gift comprising both existing and future property is not legally binding as to the latter.

GIFT TO SEVERAL OF WHOM ONE DOES NOT ACCEPT

Section 125 says that a gift of a thing to two or more donees, of whom one does not accept it, the gift is void to the extent of the share of the person who refuses it and the share reverts to the donor.

WHEN GIFT MAY BE SUSPENDED OR REVOKED

The donor or beneficiary may agree that a gift shall be suspended or revoked upon the occurrence of any specified event that does not depend on the donor's will

UNIVERSAL DONEE

If a gift includes the donor's entire property, the donee is legally responsible for any debts or liabilities of the donor at the time of the gift, up to the value of the property given.

NOT APPLICABLE TO ISLAMIC LAW REGARDING GIFTS

The provisions for gifting under the Transfer of Property Act 1882 do not apply to any rule of Islamic law

IMPORTANT DOCTRINES REGARDING TRANSFER OF PROPERTY

Where, with the consent, express or implied, of the persons interested in immovable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorized to make it.

FRAUDULENT TRANSFER UNDER SECTION 53

Every transfer of immovable property made with the intent to defeat or delay the creditors of the person making the transfer shall be voidable at the option of any creditor who is defeated or delayed by the transfer. This rule does not impair the rights of a transferee who acted in good faith and for consideration. Every transfer of immovable property made without consideration and with the intent to defraud a subsequent transferee shall be voidable at the option of such transferee.

PART PERFORMANCE UNDER SECTION 53-A

This contract is for the transfer of any immovable property, which will be signed by the person transferring the property. The terms of the transfer must be clear and certain, and the transferee must take possession of the property or part of it, or continue to be in possession if they are already there. The transferee must also do something in furtherance of the contract, and be willing to perform their part of the contract. The transferee or any person claiming under him or her has the right to take or continue in possession of the property, unless there is a right expressly provided by the terms of the contract.

REGISTRATION OF TRANSACTIONS MADE UNDER TRANSFER OF PROPERTY ACT

Section 17 of the Registration Act 1908 requires the registration of transactions - like a mortgage, sale, exchange, lease, gift, etc. - if the value of the transaction is Rs. 100 or more. After complying with all requirements of the Registration Act, the documents have to be submitted to the Registrar - along with the prescribed registration fee. In the case of an assignment of a Mortgage, the consideration for the deed of assignment is deemed to be the value for Registration.

STAMP DUTY ON TRANSACTIONS

The Stamp Act 1899 prescribes the stamp duties that are to be charged on certain documents. Article 23 of the first schedule prescribes the fixed stamp duty that is to be charged on Conveyances, which includes the sale of movable and immovable property according to Section 2 (10) of the Stamp Act 1899. Article 31 of the first schedule prescribes the stamp duty on the documents of exchange, while article 32 describes the further charge that is to be placed on a mortgaged property. Lastly, article 33 prescribes the stamp duty on instruments of gifts. The stamp duty on documents of lease is described in Article 35, while the duty on mortgage deeds is laid out in Article 40.

Real Estate Law