Land: Usufruct Or Rent Agreement?

[Jahil]

My wife (thai citizen) and I intend to build a house soon and I want to know how I can best protect myself if anything would happen to my wife….

Do I need to make a rent agreement or an usufruct is enough?

[stgrhe]

A usufruct is enough in my opinion although, given section 1469 of the civil and commercial code, if you really want to be sure make sure you register a second name on the usufruct of someone that is much younger than you. If you e.g. has a child from a previous marraige use the child's name too.

Not all land offices would agree to a second name and in this case you could always take out a 30 years lease too.

[villagefarang]

We only paid 75 baht and there was no need for a lawyer. It is a very simple straight forward usufruct form. No problem at all in Thoeng.

[happylarry]

villagefarang , I am not familiar with the form that you have used so I am not saying it is no good but I think it is always best to have a lawyer use their experience and knowledge to draw up a usufruct document which covers all aspects of your own circumstances. Like when making a will there are many little things that a normal citizen simply doesnt think about at the time. And when you look at the amount of money involved in properties is it really worth saving a lawyers fee and just paying 75 baht and risking everything.

HL

[villagefarang]

villagefarang , I am not familiar with the form that you have used so I am not saying it is no good but I think it is always best to have a lawyer use their experience and knowledge to draw up a usufruct document which covers all aspects of your own circumstances. Like when making a will there are many little things that a normal citizen simply doesn't think about at the time. And when you look at the amount of money involved in properties is it really worth saving a lawyers fee and just paying 75 baht and risking everything.

HL

You may be right, but with the law being what it is, I wonder how much extra stuff a lawyer could slip into the standard government usufruct that they already have at the land department. I mean and still get them to sign off on it. Lawyers do need to make a living, I guess.

Then again I wasn't all that interested to begin with. It was two years after we built, and the wife who insisted on doing it, as she was not feeling all warm and fuzzy about her family at the time.

In truth, I probably wouldn't enjoy living here without her anyway and there are a million different ways that people could make life miserable for me, even if I had every possible legal document. Being 20 years older than her, hopefully that scenario will not present itself.

[happylarry]

The usufruct contract is made between the owner of the land and yourself...and providing both parties willingly sign the document in front of the land department staff then the content of the contract is not that important. (to the land office I mean) They then register the contract on the title deed and attach a copy of the contract as well.

The contract needs to be drawn up to be watertight as regards the wife's family not being able to oust you in the event of your wife's untimely death.

For instance if as you say you wouldnt want to live there anyway then you may want to rent the property out so that would need to be written into the contract.

Anyway just my thoughts mate, lets hope it never happens..

HL

[Prajak]

This I saw in the Thailand Forum (Dutch language)

====

- It is possible to cancel or void a usufruct agreement

If you are NOT married to the owner granting you the usufruct, we believe it is not possible to cancel a usufruct and you are legally protected.

If you are legally married to the owner, Thai lawyers disagree on the application of article 1469 CCCT. This article mentions that all agreements made between spouses can be cancelled by the Court at the request of one party, unless agreements affect third parties. According to one interpretation, "publicity" or registration affect third parties and a usufruct can't be cancelled. According to the other interpretation, we have to search for the spirit of the law and it looks like Thai law wanted to end all relations between spouses in case of divorce, even usufruct agreements. A way to avoid the application of 1469 CCCT would be to have a second agreement (like a lease) affecting a third party before the Court could cancel your usufruct agreement.

====

Would not be nice......

[Khun Jean]

Indeed, make sure someone else is on the agreement too. Without that a rental contract with your wife is useless as is a usufruct.

Another option is to let someone in your wifes family buy the land. Then make the usufruct agreement with that family member.

Her mother or father would be a good choice as she will probably inherit the land after they are gone.

Sisters and brothers can or can not be a problem depending how the relations are in the family.

It will be tough to get your wife to agree to this, but if it is 100% your money you're the boss.

[ProThaiExpat]

I am impressed with this website on Thai Land Law:

http://www.samuiforsale.com/

[Pib]

Recommend you go the usufruct route. That's what I did. While a usufruct doesn't offer 100% protection, it's probably provides the most protection you can get in Thailand as a farang. You name along with the wife's name will be on the back side of the chanote, with your name basically saying you have a lifetime usufruct claim on the land.

[Khun Jean]

Until your wife decides she wants to break the contract. Then it is bye bye....

[Pib]

Until your wife decides she wants to break the contract. Then it is bye bye....

Got any pesonal experience on your statement?

[Khun Jean]

Until your wife decides she wants to break the contract. Then it is bye bye....

Got any pesonal experience on your statement?

No.

Reading what the law says about this subject (section 1469 Civil and Commercial Code) is clear enough.

For your convenience :

Section 1469. Any agreement concluded between husband and wife during marriage may be avoided by either of them at any time during marriage or within one year from the day of dissolution of marriage; provided that the right of third persons acting in good faith are not affected thereby.

note that it says ANY agreement , and at ANY time.

Solution. Divorce your wife, wait a year to be sure. Get a usufruct. And marry again.

Edited January 14, 2010 by Khun Jean

[Pib]

I expect there are a lot more devil-in-the-details/roadblocks to either spouse just deciding to cancel any agreement they made with each other. I expect the definition of "agreement" is the operative word. And I wonder if a usufruct, which is basically a contract, is considered only an agreement. IMHO, a usufruct, is still a farang's best protection in buying land with the Thai spouse. Cheers.

[Khun Jean]

No, there are no devil-in-the-details/roadblocks. Just void the contract. If necessary through court. Nothing complicated about it.

Agreement/contract all the same. Sure you can try to make a case on a single word, but you are also fighting against the 'spirit of the law'. That is a no win situation.

Well you will find out when you expect it the least. I hope for you Pib it will never happen!

Think about the part that says 'provided that the right of third persons acting in good faith are not affected thereby.'

That is one of the solution to get the protection you need. Think about a third party you trust, like a good friend, brother, children from another relationship, etc..

Until then a contract/agreement with your spouse while married can be easily voided.

Another possibility:

I have a usufruct with my wifes mother who is the official owner of the land. If the land becomes my wifes through inheritance the contract is still solid because it was not made during marriage.

Only problem left is that i am worth more dead then alive.

These options make it impossible to void the contract. Other numerous reason still exists for you not to want to use the land anymore, but those have more to do with feelings and relationships. At least you will be in your right to stay.

Edited January 15, 2010 by Khun Jean

[Pib]

Good to see you went the usufruct route with the mother-in-law. More secure than a rental arrangement. Cheers.

[donx]

Good to see you went the usufruct route with the mother-in-law. More secure than a rental arrangement. Cheers.

Why do you assume he has a usufruct with his mother-in-law? I think he is speaking hypothetically and not as if this is what he actually did. Of course I could be completely wrong.

[clinique]

go the usefruct route.. we had opinions from 3 big international law firms in Bkk and one here,, it is definately the most secure way,,and most people dont know about it, and many Thai lawyers will not tell you..

[Khun Jean]

Good to see you went the usufruct route with the mother-in-law. More secure than a rental arrangement. Cheers.

Why do you assume he has a usufruct with his mother-in-law? I think he is speaking hypothetically and not as if this is what he actually did. Of course I could be completely wrong.

Donx,

That is what i did about 2 years ago, as a contract with your wife made during marriage is easy to break up.

Section 1469 Civil and Commercial Code is so very clear on that, i not understand why people still ignore it and go with what a lawyer says.

Most of the time a lawyer that has a vested interest.

The biggest problem is that almost all Thai lawyers don't know about it and the foreign lawyers conveniently stay quit about it.

There is no accountability in Thailand.

Whatever you do, better make sure you know as much as possible about the consequences.

The third party on the contract when made with your spouse is a necessity. If that is impossible rent for a maximum 30 years or get a usufruct from someone else. You will be much safer.

If the choice is to give it to your spouse later, voluntary or not, that is also a decision you can make.

I (she!) have a few rai here and there exclusively on my wifes name. And i have no problem with that.

But the place i want to live later, that one is with the best possible protection. and in my case that was a ususfruct with the mother in law.

Don't want to have the risk that i get kicked out of the house when our relationships ends. Especially when i am considerable older then now, with surely less means to start again.

This info is also important for all the people that go retire to Thailand. Seen to many old couples have agreements for 30 years with rights for 2 extension. They will get the wakeup call later when they reach an old age. They get kicked out, i am 100% sure of this because the economic advantages to do this for the land owner are enormous.

Edited January 18, 2010 by Khun Jean