A Cautionary Tale on Sale & Purchase Of Land in Zimbabwe

In a contract of sale of land, there is a requirement that both the seller and the purchaser have an intention to deliver the rights of undisturbed use, enjoyment, and disposal of the land to the buyer. Put differently, to enable the buyer to obtain ownership of the land sold^[1]. This intention of transfer of ownership may not be readily available in such a contract due to deliberate fraud by the seller against the buyer or some mistake as to a certain fact. 

It is a tenet of our law that no one can transfer more rights to another than that he or she has. It follows, therefore, that one who is not the owner of the land (e.g a lessee), or even a fraudster, is incapable of transferring the right of ownership to another person. Even if the person acquiring the land acts in good or bad faith and makes payment for it; or the purported transferor was a bona fide possessor (that is a person who believed himself to be the owner of the thing) or genuinely, but mistakenly, believed that he or she was authorised by the owner to sell the land^[2].

The objective of this article is to recommend protective guidelines to would-be purchasers against invalid land sales where ownership of the land will not be obtainable by the purchaser by reason of fraud or mistake. The law in this regard will savagely protect the right to ownership through the actio rei vindicatio (vindication) to the detriment of a bona fide purchaser. “The actio rei vindicatio is found in property law. It is aimed at protecting ownership. It is based on the principle that an owner shall not be deprived of his property without his consent. So exclusive is the right of an owner to protect his property that, at law, he is entitled to recover it wherever it is found and from whomsoever is holding it, without alleging anything further than that he or she is the owner and that defendant is in possession of the property. Thus it is an action in rem enforceable against the world at large this is settled law which hardly requires authority.”[3] No purchaser will want this rule of law to apply to himself after purchasing a property.

Consult a Lawyer

It is a cautionary practice in an intended property purchase for one to consult a lawyer to undertake legal due diligence before committing to the transaction. The due diligence exercise entails that a lawyer attends to verification of the identity of the seller who may be an individual or legal entity; the establishment of the thing sold, and the confirmation of the price, among other things.

Identity of Seller

If the seller is a private individual, then his or her identity is verifiable by a national identity registration document or a valid passport. One may even be as diligent as verifying the residential and business addresses of the seller to see if, as a matter of fact, the seller abodes at the addresses as stipulated by him. It should be noted that there have been reports that some fraudsters have even developed ways of superimposing their pictographic identities on stolen passports. However, this will no longer be possible in the short term with the advent of the E-Passport which drastically curtails any possible infringement on the integrity of a passport as an identity document.

If the seller is a company, other business entity, or trust, the purchaser must confirm whether the entity is duly registered and operating. In the case of a company or other business entity, this can be done at the Companies and other Business Entities registry which is the public office for the inspection of registered business entities^[4]. A review of the annual returns of the company concerned must show up-to-date information on the company’s registered office address, the address at which the register of members is kept, the number of shares in the company, the number of issued shares, directors, and secretary(ies) in office and auditors. For the inspection of registered trusts, the public office for the inspection of registration thereof shall be the deeds office Harare or Bulawayo. This inspection must reveal who the Trustees, for the time being, are of the trust, their physical addresses, dates of birth, and identification card numbers so that the purchaser may be able to verify who is authorized to represent the trust in selling the property.    

Property Sold

The land being sold is defined as a surveyed unit of land represented on a diagram[5] surveyed by a Land Surveyor and approved by the Surveyor General’s office, or as depicted on a general plan[6] The diagram or general plan is then accepted for registration of title in the deeds registry. Thus for purposes of registration of title to a unit of land, a diagram gives representation by a geometrical figure the description of the unit; the extent (area) of the unit; the boundaries of the unit; the description of the beacons (pegs) marking the unit.

A piece of land being sold is therefore ascertainable at law by reference to the diagram or general plan. The title to the unit of land as is represented on the diagram or general plan is then registered under a title deed. One can have access to this information in the Deeds Registry (Harare and Bulawayo) which is the public office of custody of deeds in Zimbabwe. 

Some units of land that may be created by way of subdivision to a unit of may not as yet be registered in terms of a title deed. However, a survey diagram prepared by a Land Surveyor must be attached to the subdivision permit^[7] showing the extents of the boundaries and measurements of the area of the unit of land amongst other things. There is no valid agreement unless the thing sold, which is the land, is identifiable and is ascertainable because it forms the object of the agreement of sale.

Purchase Price   

In the purchase of property that is held under a title deed, it is settled practice that, pending the registration of title transfer of that property from the seller to the purchaser, the purchase price is held in trust by the attorney attending to the registration of title transfer. The purchase price is then remitted to the seller when title transfer is achieved. The reason is that the purchaser must be first placed in a secure position acquiring the rights to ownership by registration of title transfer before the seller can receive the value of the ownership rights transferred.  

The purchase price of a property held by title deed also informs the revenue authority (ZIMRA) of any Capital Gains Tax (“CGT”) that may be due by the seller on the transaction. Registration of title transfer cannot be concluded without a valid CGT assessment certificate duly issued by the Revenue Authority that CGT has been exempted or has been levied and satisfactorily paid or secured. 

A government stamp duty may also be payable upon the sale of land^[8]. No registration of title can be effected by the Registrar of Deeds without stamp duty being paid.

There are instances where a seller may not have title deeds yet, for example, where the seller has been given personal rights by a developer of land units and will receive title transfer when the land development is complete. In those cases, the purchaser should be secured against the seller for the due delivery of the personal rights by way of a cession agreement with the knowledge and consent of the land developer. By practice, this is done at the land developer’s designated office where the land developer amends his register to incorporate the new owner who has purchased the piece of land from the original owner.

CONCLUSION

In a sale and purchase of land, the seller (legal holder of ownership rights in the land) and the purchaser should both possess the intention that dominium[9] in the property sold (as ascertained by the diagram), should transfer to the purchaser upon the payment of value to the seller causing the Seller to relinquish ownership rights of the land and transfer by registration those rights to ownership to the purchaser.  

Prepared by Tendayi Musarira 

2^nd October 2022

^[1]   See Nagel et al,  BUSINESS LAW, 2^nd Edition, Lexis Nexis Butterworths, Durban, 2000,  @ page 115, 

^[2]   See Silberberg and Schoeman’s  THE LAW OF PROPERTY, 4^th Edition, Lexis Nexis Butterworths, Durban, 2003, @ page 223

^[3]        Per Makarau J (as she then was) in ALSPITE INVESTMENTS (PVT) LIMITED VS WESTERHOFF 2009 (2) ZLR 226 (H), at page 236 E-F 

^[4]   See Section 6(1) of the Companies and other Business Entities Act (chp.24:31)

^[5]         Sec 2 of Deeds Registries Act (chp.20:05)

^[6]   Section 2 defines a general plan as a “plan which represents the relevant positions and dimensions of two or more pieces of land and has been signed by a person recognised as a Land Surveyor and which has been approved or certified as a general plan by the Surveyor General…”

^[7]         Section 39 (1) of Regional, Town and Country Planning Act [chp. 29:1] provides generally that no person shall subdivide or consolidate any property without the authority of a permit to so subdivide or consolidate land   granted by a local planning authority.

^[8]         See the Finance Act (CHP. 23:04)

^[9]   CHETTY V NAIDOO 1974 (3) SA 3 at p 13: cited with approval by Gowora JA in INDIUM INVESTMENTS (PRIVATE) LIMITED VS KINGSHAVEN (PRIVATE) LIMITED & 2 ORS: “it may be difficult to define dominium comprehensively…..but there can be little doubt ……..that one of its incidents is the right to exclusive possession of the res, with the necessary corollary that the owner may claim his property wherever found, from whomsoever holding it”