Page 6 - JULY NEWSLETTER

Ghana Real Estate Developers Association

B&FT: Are there laws that protect land encroachers?
Ans: There are two laws that protect persons who do not have title but have managed to put up a building on the
land. These are the Land Development (Protection of Purchasers) Act, 1960 (Act 2) and the Farmlands (Protection)
Act, 1962 (Act 107).
Act 2 was enacted to protect purchasers of land and their successors whose titles were found to be defective after a
building has been erected on the land and it applies to Accra only. However, Act 107 was an extension of the policy
in Act 2 to include the Ashanti, Brong-Ahafo, Central, Eastern, Volta and Western Regions.
In order for a person with a defective title to claim protection under Act 2, that person must show that they built on
the land in good faith and that they carried out a greater part of the work for the erection of the building. In one case
the court said that a mere temporary structure will not qualify as a building but an outhouse or "boy's quarters" is a
building.
In addressing whether a person or encroacher acted in good faith, the courts have considered factors like:
1) Did the encroacher conduct a search at the Lands Commission before building on the land;
2) Did the actual owner of the land challenge the encroacher to stop building and the encroacher continued to build
on the land.
3) The courts have taken the view that a person can be said to have acted in good faith if the person had been diligent
in respect of the land.
B&FT: Is there a law that prohibits individuals from owning land without developing any property on it for a peri-
od?
Ans: There is no law that prohibits individuals from owning land without developing any property on it for a period.
This is usually a contractual arrangement. For example, in government leases, purchasers are given a grace period to
start construction and a time to complete the building but these are contractual arrangements not statutory.
B&FT: How will you advise a prospective buyer to proceed in acquiring land?
Ans: The best legal procedure to follow when buying land to avoid litigation is to do a comprehensive due diligence.
Due diligence means conducting investigations into who owns land, finding out whether there are any encumbrances
on the land, and the nature of the transactions that have occurred on the land. This would require the interested pur-
chaser to conduct searches at the following divisions of the Lands Commission. Namely; the Public and Vested
Lands Management Division, the Survey and Mapping Division and the Land Registration Division.
If the purchaser is satisfied with the findings of the search, then the purchaser can now engage the vendor and con-
clude the transaction.
Immediately the transaction is completed, the purchaser should swiftly register his interest in the land. Registration
under the Land Title Registration Act constitutes notice to the world and anyone who acquires the same land is fixed
with notice of a subsisting interest in the land. In this regard, no subsequent purchaser of the land can claim that he
bought the land in good faith.
Source: www.thebftonline.com

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