Stickman Readers' Submissions November 6th, 2015

Transfer of Thai Land

Like in the U.K., all transfers of land must now be registered at the local land office.

In Thailand the procedure is different. Same same, but different.

He Clinic Bangkok

In Thailand, always use the word "different", never anything even suggesting "bad", "immoral", "criminal", etc etc. However, all people having had any experience of the real Thailand know that "different" does actually mean at least one of those things, not just what "different" normally means.

Nothing, in Thailand, is ever, quite, what it seems.

The parties, seller and buyer, must attend at the land office together. A company which is a seller or buyer must send a representative who has a power of attorney executed by the company and a sealed copy of the company resolution to sell (or buy?) the land, which must specify the price.

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The land office will charge a fee based on the opinion of the land office as to the value of the land. What is paid by the buyer to the seller, or any other consideration given, or indeed any other fact, is presumed to be irrelevant.

If the buyer considers it is relevant, because the real value of the land is far less than the value in the opinion of the land office and so this affects the fee he has to pay, presumably he can produce documentary evidence which may alter the opinion of the land office. There are no statistics as to how often, if at all, that occurs.

In principle, charging a fee according to value instead of the stated purchase price is not a bad thing. But like much of Thai law, the Thais make sure it is not effectual. The way it is done here does not necessarily achieve a fee being paid on the actual value. Sometimes, some might argue, that can be a good thing.

Another different thing is that where the seller is a company, whether or not it has actually contracted with the buyer to sell at a certain price, and the land office values the land at a different amount, the land office has the power to withhold registration unless the selling company makes a new decision (a company resolution) to sell to the buyer at the land office valuation price and provides the land office with a copy of the resolution varying the original decision of the company.

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Of course, the seller might not want to sell at the valuation price if it is a price lower than that which the buyer is prepared to pay. If there is a contract beforehand, as usually there will be, it is important for the contract to contain provisions so that what the land office requires will not affect the deal done between the parties.

Apart from the bag of worms which this situation could produce, as a westerner I find it incredible as a matter of principle that the land office can dictate ANY of the terms of a contract between a seller and a buyer. What happened to privity of contract? Was that not understood by the Thais when they took a lot of English law into their jurisprudence? And it is equally incredible that in given circumstances the land office can apparently dictate to a limited company what the limited company must decide.

The strangest thing that I have observed about the usual modus operandi in the transfer of land here is that the registration has to go through before the buyer hands over any money.

In any other shopping you do in this world, or even in Thailand, the cashier calculates the amount you must pay for the goods you want and only when you have paid the money are the goods, bagged, wrapped or tied up, given to you. This applies whether you are at the corner shop or Tesco doing your domestic shopping, whether you are at HomePro buying kitchen appliances, or in the timber-yard buying some timber which they will give (and perhaps deliver) to you later.

In most national systems for transfer of land, you place your money on the table, or in the bank account of the seller's agent/lawyer, and then the transfer deed and any other documents you need for registration, and the keys, are given to you. One does not get those things until one has paid the money. "Completion" occurs when the money has been received.

In my recent sale of land in Thailand I did not see the money until the property had been transferred! And registered!! As the seller, I only permitted it because I was represented by a lawyer, and she advised me that it had to happen that way. So I learned the law here. The buyer however is in what seems to me to be an inordinately strong position.

I suppose this allows for buyers and their lawyers to be careless and get away with it. A bit like a presumption of negligence. An expectation that Thai lawyers will be negligent (and not penalised in any way for it). Whereas in most commercially developed countries the presumption is that you can and should rely on your lawyer to get things done correctly so that you get what you intend, and not have to pay more, here no such presumption exists.

The situation in Thailand, or some parts of Thailand, is more illogical and not conducive to ease of business than I have described. I learned the following as well.

A buyer will not get his title document from the land office, showing his ownership, unless a bribe is paid. The locals call it money under the table. After all, bribery is a criminal offence, is it not? So it cannot be called bribery. The locals will call it something else. Here very few people live in the world we are accustomed to, unless they have had a foreign education.

I am reliably informed that the amount of the bribe depends upon the nature and location of the property, but starts at 50,000 baht for the simplest transaction.

For the registration of beachland the land office requires a bribe of more than they want for registration of jungle land, more for registration of a hotel than for a small house with two bedrooms, more for land with a sea view in a town than similar land in a deserted part of the province. The land office assesses the bribe they want by applying these criteria, I am told.

It occurred to me that once a transaction has been concluded at the land office the buyer can simply refuse to pay a bribe and demand an order from the court, if need be, for the delivery of his title deed. I am told this is virtually never done. I assume this must be because the amount of the bribe required is always set (as best the land office can guess) at less than the cost of court proceedings in terms of time and money for the buyer. And perhaps also, the buyer might be invited to consider his personal safety.

People who work in the land office have a greater income from bribes than from their salary, at least so I have been told by an ostensibly reliable source.

This Indeed is Thailand. (T.I.T.) Mostly, the people have never taken their religion seriously enough to have a culture of honesty as a virtue. If you are surprised by that, remember, nothing here ever is what or how it seems to be.

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