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Do You Need A Property Lawyer For Property Transfer In Malaysia?

Do You Need A Property Lawyer For Property Transfer In Malaysia by TYH & Co. Conveyancing Law Firm Malaysia

Do You Need A Property Lawyer For Property Transfer In Malaysia?

Do You Need A Property Lawyer For Property Transfer In Malaysia?

The Seller’s Solicitor vs The Purchaser’s Solicitor

In legal sense, “Conveyancing” means the transaction or business of drawing up documents and/or instruments to effect the transfer of title or interest in a real property from one to another.

Most of people must be wondering that why do we need a lawyer to represent ourselves in a conveyancing transaction which would incur extra cost? Here your question will be answered:-

  • Even in the simplest conveyancing transaction, regardless of whether you are the houseowner or the potential purchaser, you would need a lawyer to protect and safeguard your interest against possible fraud or forgery;
  • The whole process of conveyancing would require a high degree of legal skill and caution to effect the transfer of a real property.

The roles of a Seller’s solicitor and a purchaser’s solicitor are different. Each party’s solicitor will have to assess for herself or himself the steps to be taken to secure the client’s interest and for her or him to comply with the professional rules and etiquettes:-

Roles of a Seller’s Solicitor

  • To protect the interest of the Seller in the process of completing the Sale and Purchase Agreement;
  • To determine the possible legal issues on a case to case basis;
  • To ensure that the Seller is properly advised and informed in relation to every clause and/or item stated in the Sale and Purchase Agreement;
  • To prepare all the necessary accompanying documents to the Sale and Purchase Agreement and instrument of Transfer;
  • To ensure that the Seller complies with all the obligations, covenants, warrants and representations mentioned in the Sale and Purchase Agreement;
  • To ensure that the Seller furnish all the relevant and necessary documents to the Purchaser in order to complete the process of sale and purchase, such as the original Title Deed, the Seller’s certified true copies of identification card, the copies of the current Quit Rent and assessment and so on;
  • To deal with other possible issue depending on a case to case basis, such as Real Property Gains Tax, application for consent from the State Authority, application for order for sale from Court and so on;
  • If the Property is subject to bank’s charges or is assigned to any bank (as the case may be), the Seller’s solicitor has to first redeem to the Property from the bank OR if the parties agree to redeem the Property from the Purchase Price, to obtain the bank’s Redemption Statement and furnish the same to the Purchaser;
  • To ensure that the Seller receives the full Purchase Price of the Property from the Purchaser or the Purchaser’s Financier bank.

Roles of a Purchaser’s Solicitor

  • To safeguard the interest of the Purchaser in the sale and purchase transaction;
  • To determine the possible legal issues on a case to case basis;
  • To conduct all the necessary land searches of the Property to ascertain important details of the Property such as the particulars of the owner of the Property, title details, the status of the title (whether freehold or leasehold), category use of the land and so on;
  • To conduct all necessary searches on the Seller (bankruptcy or winding up searches) to ensure that the Seller is capable to dispose of the Property to the Purchaser;
  • To explain and advise the Purchase pertaining to the clauses contained in the Sale and Purchase Agreement;
  • To prepare and draft all the relevant supporting documents;
  • To ensure that the Purchaser follows and complies with all the obligations, covenants, warrants and representations stated in the Sale and Purchase Agreement;
  • To deal with other possible issues depending on a case to case basis, such as Real Property Gains Tax, application for consent from the State Authority, adjudication of stamp duty and so on;
  • To ensure that the sale and purchase transaction is carried out smoothly and without any unnecessary delay on the part of the Purchaser to avoid imposition of any late payment interest;
  • Make sure that the full Purchase Price of the Property is paid and/or settled within the completion period or the extended completion period as stipulated in the Sale and Purchase Agreement in exchange for an indefeasible title to the Property;
  • To present instrument of transfer and all the necessary and relevant accompanying documents together with the requisite payments at the land office to effect the transfer of the Property into the name of the Purchaser;
  • To ensure that the Property is duly registered under the name of the Purchaser and the original title of the Property to be provided to the Purchaser (if the Property is not charged to any bank).

Theoretically, each party to a sale and purchase transaction should engage their own solicitor and a solicitor should not represent more than a party in the transaction.

However, sometimes, a Seller does not engage her or his own solicitor because either they are not aware of their right to do so or they simply do not want to fork out money to pay for the legal fee. In that circumstances, the common practice is that the purchaser’s solicitor would assist the Seller in preparation of the accompanying documents and to assist the Seller to attend to the requisite obligations under the sale and purchase agreement, such as application for consent from the State Authority, issues relating to Real Property Gains Tax and so on. The Seller would then have to pay for some fees and disbursements in return to the purchaser’s solicitor for those matters.

However, bear in mind that the purchaser’s solicitor is not representing the Seller in the transaction and therefore the priority of the purchaser’s solicitor would still lies solely on the interest of the purchaser and not the Seller’s. For example, it would be almost inevitable that most of the provisions in the Sale and Purchase Agreement would then be in favour of the purchaser.

In short, it is advisable that each party in the conveyancing transaction should appoint their own solicitors and to be represented so as to ensure that their interests are protected at all times from the negotiation stage for the terms in sale and purchase agreement till the completion of the transaction.

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