According to section 14 of the Deeds Registries Act [Chapter 20:05] ownership of land may be conveyed from one person to another only by means of a deed of transfer executed or attested by a registrar. Ownership in land is therefore evidenced by a title deed. Where the seller only has an agreement of sale to the land he/she is not the owner in the legal sense and therefore cannot pass ownership to the purchaser. What he/she has are personal rights and these can be transferred to the purchaser through cession (for example where one has an agreement of sale from a local authority or developer).
The person who attends to the transfer/conveyance of property from the transferor to the transferee is called the conveyancer. A conveyancer is defined in the Act as a person registered as such in terms of the Legal Practitioners Act [Chapter 27:07]. As it is the seller who is conveying his/her ownership of land, it is he/she who must appoint a conveyancer (see Cosmas Luckyson Zavazava & Anor v John Tendere & Ors H740/15).
The first important thing in the transfer of immovable property is the agreement of sale which contains the terms as agreed between the parties. Where the transfer is a donation there should be a deed of donation. It is illegal and self-defeating to understate the value of the property in the agreement of sale or deed of donation. Illegal in the sense that the seller is ‘stealing’ from the State in terms of payment of capital gains tax and self-defeating in that the purchaser is lowering the value of his/her own property given that the value will be stated on the deed of transfer. Where the land being sold or donated belongs to a minor, it is important that the consent of the High Court be sought and obtained first. In estate transfers the letters of administration, distribution account/consent to sale and death certificate are the most important documents.
The conveyancer will issue a pro-forma invoice to the purchaser containing the conveyancing fees and stamp duty. The conveyancing fees are prescribed by law and payable before the conveyancer attends to the transfer process. There are exemptions from payment of stamp duty and the transferee may seek clarification on these from the conveyancer.
The seller must surrender to the conveyancer the original title deed and give him/her the power of attorney to pass transfer. The transferor and transferee must sign the declaration by seller and declaration by purchaser respectively. All these documents are prepared by the conveyancer including the draft deed of transfer.
The conveyancer will also attend to obtaining the rates clearance certificate from the relevant local authority. The usual requirement for the issuance of a rates clearance certificate is that the arrear rates be paid plus payment of future rates for a specified period. Karoi Town Council for example requires payment of rates six months in advance and also administration fees.
The other important process is the obtaining of the capital gains tax clearance certificate. The parties can attend to this process on their own but in most cases the conveyancer will facilitate the process. The capital gains tax is obviously paid by the seller and it is important for the seller to understand this obligation before selling the property. For the purposes of capital gains tax a donation is treated as a sale. It is also important for the seller to understand if he/she falls within any of the listed exemptions to payment of capital gains tax. ZIMRA usually interview the parties for assessment of the capital gains tax and the Commissioner may in some circumstances determine the fair market value if he considers that the value given is lower than the fair market value.
Once all the documents are there the conveyancer will lodge the draft deed, original deed, power of attorney to pass transfer, rates clearance certificate, capital gains tax clearance certificate, declarations and proof of payment of stamp duty with the registrar of deeds. In estate transfers the letters of administration, distribution account and death certificate will also have to be lodged. If there are no queries the registrar will affix his/her signature and from that moment the deed is deemed to be registered.
The importance of having a title deed over land cannot be overemphasised. A title deed is proof of ownership of land. Ownership is a real right which can be enforced against the whole world. One can use title deeds to land as security to obtain a loan from a financial institution and this is not possible where one does not have a title deed to the land. It is always advisable to finalise the process of transfer once parties sign the agreement of sale as unforeseen circumstances such as death of either party may complicate the transfer process.
The contents of this article are for general information purposes only and do not constitute our legal or professional advice. We accept no responsibility for any loss or damage of whatsoever nature which may arise from reliance on any of the information published herein.
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