Lease Agreement Example

[m1crosc]

I am looking for a lease agreement in Thai and English that I can use to discuss terms etc with everyone concerned.

A basic 30 plus 30 with the usual terms.

Thanks. PMail if it helps.

[gotlost]

google : standard lease agreement form Thailand

function setAttributeOnload(object, attribute, val) { if(window.addEventListener) { window.addEventListener("load", function(){ object[attribute] = val; }, false); } else { window.attachEvent('onload', function(){ object[attribute] = val; }); } } <H1 id=blog-title>Land Lease Agreement in Thailand </H1>Review Presented by Baan Sammi Real Estate Service, Doi Saket, Chiang Mai, Thailand

<H2 class=date-header>05 ตุลาคม 2005</H2><H3 class=post-title>Land Lease Agreement — Sample Form </H3>

The possession of landed property in Thailand, but not free­hold ownership, by a foreigner can be based on a land lease agreement between the Thai landed proprietor as the lessor and the foreigner as the lessee (leaseholder). A general but brief overview on "purchasing" land in Thailand by a foreigner, including other routes of obtaining possession than lease­hold, is given in the <A href="http://baansammi-faq.blogspot.com/">FAQ, including further references for more details.

The leasehold route is frequently followed by a foreigner with his Thai partner or friend for life, a foreign-Thai couple married or not. Further, a leasehold contract is often made between a single foreigner or foreign-foreign couple, and a (foreign-controlled) Thai company, e.g. land and real estate developer.

The agreement is generally made for a lease term of over three years, usually 30 years, a term that enables the parties to register the contract at the district land office, which the landed property belongs to. The inexperienced foreigner should contact his Thai lawyer for drafting a land lease agreement that fits best his requirements. However, to get the lease registered at the land office, the represent­ation by a lawyer is not a must, but he can assist for a smooth procedure.

Below is given a sample form of a lease agreement in English. This agreement does not fit to every lessee/lessor or case. It was originally drafted as a contract to fit basic requirements between a Thai person (as the landowner and lessor, e.g. Thai wife) and a foreigner (as the lessee, e.g. husband), not between a Thai company and a foreigner.

The English version of a sample agreement might help to discuss the clauses in detail with your lawyer. In order to get the agreement registered by a district land office, and for legal binding at Thai courts, only a Thai version is accept­able. The correctly written agreement in Thai should there­after be translated into English, so that the English version bases on the Thai, not the other way round. In case of any different interpretation of the wording, only the Thai version is relevant.

LEASE AGREEMENT

Agreement made at ........., date ......... .

This Lease Agreement is between ........., hereafter known as the Lessor, and ........., hereafter known as the Lessee.

It is hereby agreed as follows:

1. The Lessor agrees to lease and the Lessee agrees to rent a ...-storey house and land, located at ......... in accordance with Land Title Deed Number ........., Land Number ........., Book Number ........., Page Number ........., Subdistrict (Tambon) ........., Province (Changwat) ........., Total Land Size ...... Rai ...... Ngan ...... Tarang-wa, hereinafter known as the "Said Premises" for a rent period of 30 years.

2. The Lessee agrees to a one-time advance payment for the entire rent period in the amount of ......... Baht (.........) to the Lessor on the date of registration at the District Land Office. The Lessor and the Lessee agree to register the leasing terms and conditions at the District Land Office within 7 days after having signed this Agreement. The rent commences on the date of registration at the District Land Office.

3. Both parties agree that the Lessee shall have an option to renew this lease for an additional 30 years, for rental terms and conditions as mutually agreed by both parties.

4. After the date of the Agreement, the Lessee shall have the right to live in and conduct legal and socially acceptable businesses in the Said Premises during the term of the lease.

5. The Lessee agrees to take care of and to preserve the Said Premises as one would do to his/her own, maintain the upkeep of, and attend to repairs of the Said Premises, which may be caused by accidental or intentional actions of the Lessee or the Lessee's subordinates.

6. The Lessee may assign or sublet the Said Premises to other Parties. Should there be the need to make official registration or other legal proceedings, the Lessor agrees to give consent and to assist the Lessee in providing proper documentation and shall not ask for any returns from the Lessee. The Lessee agrees to pay for any fee and other expenses that may arise from such proceedings.

7. The Lessee agrees not to damage or deface the Said Premises or make structural alterations or additions thereto without the written consent in writing of the Lessor and all structural alterations shall be in accordance with government and municipal guidelines. The Lessee agrees to pay any costs involved while the Lessor agrees to provide necessary documentation in obtaining such official permits.

8. Should the Lessor wish to sell the Said Premises, the Lessee shall have the first option to purchase from the Lessor or the option to find other party to purchase from the Lessor. Should the Lessee be unable to find such party to purchase from the Lessor, the Lessor may sell Said Premises as he/she so wishes. The Said Premises shall not be sold or Title transferred during the Lease period. Debts accrued by the Lessor to outside parties shall not effect the lease terms.

9. Should Thai laws allow non-Thai citizens to purchase properties, the Lessor shall give the first right to purchase the Said Properties to the Lessee as a special condition.

10. The terms and conditions of the Agreement obligate the heirs of both parties to fulfill, and shall not be altered without mutual consent.

11. The Lessee shall be responsible for paying Building Tax (Phasi Rong Ruean) and Land Tax (Phasi Ti Din) for the duration of the lease period.

12. On the day the Agreement is made, the Lessee shall inspect the Said Premises including all the fixtures and fittings therein to be of good and tenantable condition and accepts lease responsibility henceforth.

13. Should the Lessor be unable to carry out the terms and conditions stated above the Lessee have the right to ask for compensation five times the rent amount and the special condition amount that the Lessee has prepaid.

14. In the event of the Lessee's premature death while the Agreement is still in effect, the rights and obligations of the Lessor shall be transferred to ........., address ......... .

Both parties, having read and fully understanding its contents, agree to comply with all the terms and conditions. Therefore, both parties have hereunder affixed their signatures in presence of two witnesses on the date at the place first written above.

......... The Lessor, ......... The Lessee,

......... Witness, ......... Witness

The above sample form of a lease agreement is based on a post published by ozzydom in May 2005 in the Forum Real Estate, House and Car Ownership, which is part of the Thailand Forum led by thaivisa.com.

Modifications herein are made by Khun Sam and associates.

Comments and Suggestions

In the following, comments and suggestions are given for modification, altering, or inclusion of clauses.

a) Granting the right to the lessee to develop the land, extend, and improve existing buildings, and to build on the land. A clause seems to be necessary for buildings, built by the lessee on his expenses during the lease period, registered and kept in his ownership, permanently (non-removable) attached to the land.

Premature termination of the Agreement: Cases that would cause or suggest a premature termination could be identified, and rules for refund should be agreed to. Events of default on the part of the lessor should be defined, also warranties, representations and undertakings.

c) Termination of the Agreement after the lease period: Refund for buildings hold in the ownership of the lessee should be agreed to, e.g. settling with a new lease period.

d) Clause 9: "Special condition" should be rendered more precise. A price should be defined (as a monetary figure) for acquiring the property freehold in case of a relevant change of the Thai law.

Further comments and suggestions are welcome.

In the following, several sample clauses are presented which aim at improved legal rights to the lessee. The clauses are drawn from real, executed contracts which I have seen (by courtesy of A.H.); some clauses have been slightly modified (by K.S. and associates). Comments on the proposed clauses and suggestions are welcome.

Sample clause that allows the Lessee to build on the land:

The Lessor agrees to allow the Lessee to take possession and to exercise the right to construct any buildings or other structures on the leased land. In case where any construction requires prior permission by the authorities, the Lessor agrees to promptly effect such construction permission. The Lessee agrees to pay all fees and other expenses actually incurred as a result thereof.

I suggest to add clauses which clearly state that the Lessee becomes owner of the buildings and other construction, and that in case of regular or premature termination of lease the buildings must not be removed from the land, and must be taken over unchanged by the Lessor against its market value at that date.

Sample clause that hinders the Lessor from any legal action that might infringe the Lessee upon his rights on the property, or diminishes its value and usage:

During the lease term, the Lessor agrees not to create any charge or effect any juristic act affecting the right of the Lessee to the Land, or effect any other act causing disadvantage to value and usage of the Land for the Lessee. If any violation or breach of the contract agreement occurs, the Lessor allows the Lessee to inflict a penalty worth of the actual market value of the land including buildings and other constructions built on the premises. The costs of lawyers involved in the dispute shall be borne by the Lessor.

Sample clause that intends to protect the investment of the Lessee in the property beyond the 30 years leasing period:

Upon expiration of this Agreement, the Lessor and Lessee agree to effect registration of the lease for another 30 years or for a longer duration permitted by law without any conditions (financial or otherwise). The Lessee shall notify the Lessor at least one month in advance. If the Lessor breaches this Agreement by failing to extend the lease term for any reason whatsoever, the Lessor agrees to pay damage compensation equivalent to the actual market value of the buildings/constructions on the land by the Lessee if any, in accordance with the actual assessment thereof then applicable. If the Lessor defaults or delays in paying such damage compensation, the Lessee shall be entitled to charge interest thereon at the rate of 15 percent per annum of the total market value of the land and buildings at that specific moment in time.

Comments: There is some doubt if the Lessor (contract signing Lessor or heir/devisee) can legally be bound to renew the lease period by such a clause, or any other similar clause. However, there seems no doubt that the Lessor can be bound to pay a compensation at market value for the buildings/construction on the land (but not for the land itself), if the Lessor rejects to renew the lease.

Sample clauses of an additional, Private Agreement, between the new Thai owner of the land (Party One), and the Lessee (Party Two). This Private Agreement intends to legally bind the owner and his heirs to a long-term lease:

Both Parties agree as below:

1. The Party One recognizes that all payments in buying this Land and all payments in transferring ownership from the previous owner ..... (name) to the ownership of Party One are paid directly to the previous owner by Party Two.

2. The Party One acknowledges that Party Two are irrevocably granted to possess the Land and authorized to act as if Party Two were the legal owner, including to sell, handle, and make use over the land in any case as they wish.

3. The buying price of ....... Thai Baht is considered to be equivalent to the total rent for the lease term of 30 years plus extension of further 30 years, or for a longer period permitted by law.

4. The Party One shall transfer the legal ownership of the Land to the Party Two immediately and without any reservations and restrictions (financial or otherwise) in case foreign citizens will be granted the legal right to own land in Thailand.

5. In case of death of the Party One during the lease term (30 years plus the extension of another 30 years), the legal ownership of the Land will pass to the Heirs, ............. (names, address, identity card no. ...). The Heirs consent to be irrevocably bound under this Agreement.

6. In case of death of the Party Two during the lease term (30 years plus the extension of another 30 years), the leasehold of the Land will pass to the Heirs, ............. (names, address, identity card or passport no. ...). The Heirs consent to be irrevocably bound under this Agreement.

7. For the benefits of any legal act in transferring (selling or any other act of transferring ownership) this property to a third party by Party Two, Party One has written and signed two letters of power of attorney, and has handed over copies of identification card and family registration document to ........ (lawyer's name and address).

posted by Khun Sam — คุณแฃม at 11:47 ก่อนเที่ยง 0 comments links to this post

<H2 class=sidebar-title>เกี่ยวกับฉัน</H2> ชื่อ: Khun Sam — คุณแฃม ตำแหน่ง: Doi Saket near Chiang Mai City, Province of Chiang Mai, Thailand ดูโปรไฟล์ทั้งหมดของฉัน

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Back to FAQ

[m1crosc]

Yes, Seen that looking for Thai and English

[stgrhe]

The sample agreement above is most likely written by a Thai lawyer as it is not very well worded. Also I would recommend the lease to be for the land only and a separate agreement be drawn up for the construction of or buying the buildings, whichever is applicable.

[sleepyjohn]

Yes, Seen that looking for Thai and English

I was told some time ago by a well-known lawyer that agreements only needed to be in English.

Edited December 27, 2009 by sleepyjohn

[khundon]

This site has a Thai/English rental agreement if it's any help.

I did not think anyone would try for a 30+30 lease these days as they cannot be trusted. Or can they?

http://slice-of-thai.com/rental/

[m1crosc]

Thanks for that Khundon, Really needing a lease. Was hoping someone would be generous and forward one that they had used before.

[stgrhe]

None of the above mentioned sample agreements are complete!

Here are some clauses that should, among others, be part of any agreement:

1. Governing Law

2. Arbitration Rules and Procedures

3. Termination for Default

4. Suspension

5. Force Majeure

6. Title and Risk

7. Language Precedence (if agreement is written in two languages)

8. Order of Precedence

9. Termination for Convenience (applicable only if the agreement is with another sub-contractor that is dependent on another contract)

10. Addressing and Responses

11. Survival After Termination or Suspension

12. Liquidated Damages

13. Definitions

Just to name a few clauses.

[sleepyjohn]

None of the above mentioned sample agreements are complete!

Here are some clauses that should, among others, be part of any agreement:

1. Governing Law

2. Arbitration Rules and Procedures

3. Termination for Default

4. Suspension

5. Force Majeure

6. Title and Risk

7. Language Precedence (if agreement is written in two languages)

8. Order of Precedence

9. Termination for Convenience (applicable only if the agreement is with another sub-contractor that is dependent on another contract)

10. Addressing and Responses

11. Survival After Termination or Suspension

12. Liquidated Damages

13. Definitions

Just to name a few clauses.

Also seem to remember something about insurance Strghe,......what would that be?

[stgrhe]

Also seem to remember something about insurance Strghe,......what would that be?

Well, an insurance clause may not be required for a land lease agreement but it is recommended to be part of a house construction agreement.