{"id":110103,"date":"2020-12-26T17:39:26","date_gmt":"2020-12-27T00:39:26","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=110103"},"modified":"2020-12-26T17:39:26","modified_gmt":"2020-12-27T00:39:26","slug":"legitimate-caveats-under-threat-has-the-legal-fraternity-been-caught-napping","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2020\/12\/26\/legitimate-caveats-under-threat-has-the-legal-fraternity-been-caught-napping\/","title":{"rendered":"Legitimate caveats under threat. Has the legal fraternity been caught napping?"},"content":{"rendered":"

By Raj Gonsalkorale<\/em><\/span><\/h2>\n\n\n

There is speculation that caveats, the one thing that\nprotects genuine private land owners from fraudsters who manage to sell their\nland with bogus land titles, and protects genuine third parties from\nexploitation by land owners, is under threat and that legislation is being\ndrawn to change land registration laws that permit caveats on land titles.<\/p>\n\n\n\n

 It is unclear whether lawyers and notaries were\nconsulted on this development. If not, it may seem that they are gradually\nbeing sidelined on law reform in Sri Lanka. If this indeed is an evolving\ntrend, lawyers have to take some of the blame for this as they do not seem to\nhave been engaged in furthering law reform   in the country to the\nextent they should have. <\/p>\n\n\n\n

It is understood that criminal lawyers are the dominant\nsegment of the legal fraternity and lawyers engaged in land matters and other\ncivil matters have not shown any inclination to introduce necessary reforms after\nthe colonial masters left the island<\/strong>. This has prompted some lay persons to\nsay that they have suffered the consequences as such lawyers have resisted even\nthe thought of reform as they have benefited from outdated, and out of tune\nlaws and legal procedures. Several lay persons have mentioned the length of\nsome of their land related court cases stretching to not just a few years, but\ndecades in some instances.<\/p>\n\n\n\n

The speculation about reforms to caveats has arisen on\naccount of a recent cabinet decision reported as follows. It is understood that\nthis, and the absence of more specific reasons as to why the cabinet took this\ndecision, has given rise to confusion in legal circles. Many lay persons have\nalso expressed dismay that the last bastion that safeguards genuine land owners\nand third parties could be a thing of the past. Worse, speculations extend to\nthe possibility that the removal of caveats is either being done to benefit\nsome major developers and directly or indirectly to benefit fraudsters.<\/p>\n\n\n\n

In the circumstances, it is suggested to the Minister of\nJustice that he explains the background to this cabinet decision, the reasons\nwhy such a decision was taken and what specifically is going to be drafted by\nthe legal draftsman in order to clarify, and allay fears that the legal\nfraternity and above all, genuine land owners have about the future of caveats.<\/p>\n\n\n\n

Besides this, the writer views this development as another\nreason why the government should formulate a clear, strategic and sustainable\nland management policy for Sri Lanka. Land management has many dimensions as\nhas been pointed out in previous articles written by this writer and by a host\nof others. Policy on management of State land, said to account for 82% of land\nin the country is one dimension. What exactly is included in the category of\nState land, the extent of such constituents and how best their management\nshould be done to give the maximum long term and sustainable benefit to the\ncountry is a key area that needs attention. So far, appeals made to the\ngovernment via the many articles written have not borne any fruit. \nManaging State land via Gazette notifications seems to be the only avenue\nresorted to by the government.<\/p>\n\n\n\n

A policy on management of private land is the other\ndimension. Two key areas within this is the land registration law that needs\nurgent attention, Bim Saviya, and the most recent hot topic, Caveats.<\/p>\n\n\n\n

It is somewhat perplexing why the Ministry of Justice has\nsought it appropriate to direct its attention to what appears to be relatively\nless of an urgency in the overall scheme of deficiencies in land management,\nincluding the inoperable Bim Saviya. <\/p>\n\n\n\n

While seeking the apology of readers for a pun on land\nmanagement, the Ministry seems to be missing the woods for the trees here.<\/p>\n\n\n\n

Registering land titles as per Bim Saviya has been a\ncolossal failure as has been pointed out earlier. It is understood that\nbasically anyone who produces a title, irrespective of whether it is genuine or\na fraudulent one, a hora oppuwa\u201d is able to have it registered in the\nelectronic register or the eRegister. The old colonial Ordinance of 1927\ngoverns the operation of the eRegister. This ordinance states that the\nRegistrar is not responsible for the validity of deeds.  <\/p>\n\n\n\n

In case of fraudulent deeds that are so registered, the\nonly recourse a genuine land owner has if and when the fraud is exposed, is to\nseek compensation from a compensation fund. The genuine land owner will not get\nthe land back and there is no recourse to the courts to adjudicate on such\nmatters.<\/p>\n\n\n\n

In this context, a caveat is the only\nprotection that a genuine land owner has to his or her land, and also to\nsomeone who has a financial or commercial interest on a piece of land owned by a\nland owner who has had no interest in the land. Unlike in the case of\nregistering land deeds, the law is clear that registrar\u2019s need to be satisfied\nthat the land owner or a third party seeking a caveat has an interest in the\nland and the application is not a spurious one.  <\/strong><\/p>\n\n\n\n

For example, a third party maybe owed money by a land owner\nwho is attempting to sell the land without repaying what is owed to the third\nparty or the third party may have been utilising the piece of land say for\nagricultural purposes where the land owner has shown no interest in the land for\nyears. In such situations, the third party, with relevant and appropriate\nevidence could apply for a caveat to prevent the land owner from selling the\npiece of land. <\/p>\n\n\n\n

Corruption in land registries of course could result in\ncaveats being issued where applicable laws are stretched beyond what is\nprocedurally, and legally acceptable and valid. For example, a fraudster who\ngets a bogus land deed done on a piece of land that he\/she does not own, could\nhave the deed registered and then a caveat issued on it prior to selling it to\nan unsuspecting person in order to seek a premium to have the caveat\nlifted.  A third party may produce bogus evidence in support of a caveat\nin order to seek compensation from a land owner wishing to sell his\/her land.\nThe spoils probably shared with corrupt individuals in the land registration\nprocess.<\/p>\n\n\n\n

If indeed the Ministry of Justice is\nattempting to prevent this type of illegal transactions, amendments to the\nNotaries ordinance and the Registration of Documents Ordinance is the answer. All\nland transactions should have the identities of owners registered like in all\nother countries.  In fact, all land transactions should be governed by the\nCentral Bank Financial Transactions Act 6 of 2006 that deals with\nsuspicious transactions and which requires recording of the identities of the\nowners.  Caveat system should be\nstrengthened as this is the only recourse the less fortunate has to\nprotect his or her land and also protects third parties from exploitation.   <\/strong><\/p>\n\n\n\n

Minister\nmust introduce modern laws to protect legitimate owners and third parties from\nfraud and exploitation. In the age of technology, these registration\nprocedures must have safeguards that are used in electronic transactions which\nare replacing paper documents in land registries.  <\/p>\n\n\n\n

In some\ncountries telephone alerts are given to owners, similar to the path followed by\nbanks when credit card purchases take place.  Many frauds can be\nprevented if alerts are given to genuine interested parties when new documents\nenter the registry.  The Registrar should be made responsible for the\nvalidity of documents that are being registered. It is illogical for this not\nto be done. The removal of protective laws will obviously benefit the\nnot genuine and disadvantage the genuine. Law revisions and remedies are needed\nto safeguard those who are genuine and not provide additional bonanzas to rogue\nelements.   <\/p>\n","protected":false},"excerpt":{"rendered":"

By Raj Gonsalkorale There is speculation that caveats, the one thing that protects genuine private land owners from fraudsters who manage to sell their land with bogus land titles, and protects genuine third parties from exploitation by land owners, is under threat and that legislation is being drawn to change land registration laws that permit […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[172],"tags":[],"class_list":["post-110103","post","type-post","status-publish","format-standard","hentry","category-raj-gonsalkorale"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/110103","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=110103"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/110103\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=110103"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=110103"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=110103"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}