What if you buy land or a house or long-lease a property from somebody who isn't the owner? If this happens, you may be stuck, because only the owner can transfer it to somebody else at the land office.
Let's look at how this can happen. Let's say you go to look at a property at an attractive development. You are shown around by a salesperson and then introduced to the developer. He gives you a set of contracts to review, all in English. After you've carefully reviewed these, you decide to go forward. You meet again with the developer and sign the contracts.
You then transfer funds to the developer for all or part of the land and the first stage of construction of the house. After the funds have been transferred, building starts on your house, and everything seems to be in order.
What's missing from this picture?
As mentioned in earlier columns, you should have done a title search on the property before paying anything. But what if you were so enthusiastic about the development, and liked the developer so much, that you didn't think it was necessary at the time? Now you've had second thoughts. So you hire a lawyer to check the title at the land office.
It turns out that the developer doesn't own the land at all. It's in the name of some lady who appears unrelated to the developer.
There are two possible outcomes.
The one you don't want is that the real owner doesn't recognise the payments that you've made and won't sign over the title. This outcome can happen for many reasons. It is possible, for example, that the developer is fraudulently selling interests in land to which he has no claim at all. The more likely scenario in Thailand is that the developer is related to the real owner.
The developer may also be in business with the real owner. If they've fallen out, as so often happens with property deals, and you've paid the wrong party, the owner may never transfer title to you.
On the other hand, it may be that the owner and the developer are in harmony and the second outcome _ the one we want _ occurs.
When it's time, the owner transfers title to you, even though you've paid somebody else.
Of course, before you pay anything you should make sure all of this is straight.
Here's another question: Does everybody who buys or sells land in Thailand have to go to the proper land office to do so? What, for example, if you go to the land office with your lawyer to put a long lease in your name and the same developer in our example shows up with what he says is a power of attorney from the real owner? Can the lease be transferred to you?
If the power of attorney is valid, it can. But you should understand this: The only power of attorney acceptable to land offices in Thailand is the one on the land office's form. It's all in Thai and every lawyer who does property transactions can instantly recognise it.
If somebody shows you a power of attorney in English, or asks you to sign one, you can be sure that it can't be used to transfer land title interests at the land office.
For a power of attorney, the land office will request back-up proof of the identity of the person giving it. For example, they usually ask for signed copies of the person's ID card if the person is Thai. If the person is foreign, they usually require signed copies of the passport, the visa stamp pages and entry card, to show the foreigner was in Thailand when the power was given.
So, if you give someone a valid power of attorney, you don't have to go to the land office yourself to have something put in or taken out of your name.
But keep it in mind you must trust the person to whom you give your power of attorney. Otherwise, you may find that the outcome isn't what you had hoped for. Therefore you should give your power of attorney only to someone you know and trust or someone who is legally required to act in your interest, such as your lawyer.
James Finch of Chavalit Finch and Partners (email@example.com)
and Nilobon Tangprasit of Siam City Law Offices Ltd (firstname.lastname@example.org).
Researchers: Arnon Rungthanakarn and Sitra Horsinchai.
For more information visit www.chavalitfinchlaw.com.
About the author
Writer: James Finch & Nilobon Tangprasit