Is a 30 year lease transferrable?

[giddyup]

More out of curiosity than a need, but wondering if my 30 year house lease can be sold on if I chose to do so? The house chanoot is in my ladies name but I had the lawyer insert the 30 year lease clause just in case things went belly-up. The lawyer did tell me that even if my partner pre-deceased me (unlikely) the 30 year lease would still stay in force until my death, then I assume it would go to her family. So is my 30 year lease transferrable?

[giddyup]

Maybe this should have been posted in "Ask a lawyer" section.

[alant]

I have been told that these leases are transferable and can be willed. If this needs to be a part of the initial lease I don't know. Infor was from a lawyer but not as a part of an official consultation.

[AnotherOneAmerican]

If you are married, and no will to state otherwise, you inherit.

If purchased after marriage, you already own 50% (joint asset)

If she dies, you inherit at least 50% of her share, giving you a total of at least 75% of the property.

If you made the lease after marriage, no protection anyway, as you can't enter into contracts with your spouse.

But for some reason you avoided saying 'wife' so I'm thinking not married, and you won't inherit anything.

Edited September 10, 2014 by AnotherOneAmerican

[maswov]

The house can be sold but the new owner must honor the lease. Of course the lease could be broken if you reach an agreement.

[BangkokRulez]

Not exactly the answer to your question but nevertheless worth a read: Zombie Apocalypse in Thai Property Lease

https://www.linkedin.com/pulse/article/20140815051558-11220814-zombie-apocalypse-in-thai-property-lease

[ProThaiExpat]

The language of the lease controls what you can do with it. Most leases in the West have a sublease provision which specifies whether the landlord's consent to a sublease must be obtained.

Passing the lease, which is a right of possession, to another is always a sublease, since the owner retains the right to hold the original lessee responsible for lease payments unless he consents to a sublease and thereby absolves the original lessee of his obligations under the lease. The language in the document memorializing the consent to sublease should cover the issue of release of original lessee.

[stgrhe]

The house can be sold but the new owner must honor the lease. Of course the lease could be broken if you reach an agreement.

This is incorrect. The house is owned in full by the land owner unless a proper procedure has taken place in which the owneship of the land and the house have legally been separated and registered at the land office. A contract stating the ownership of the house in not good enough.

This is a common misunderstanding by many Westerners who have 'bought' a house in Thailand with leased land.

[stgrhe]

The law permits transfer of a leased land provided this right has been entered onto backside of the title deed.

[Alwyn]

No

[mike324]

The law permits transfer of a leased land provided this right has been entered onto backside of the title deed.

Right on, lease transferable if the info is on the title deed of the property / land.

[maswov]

The house can be sold but the new owner must honor the lease. Of course the lease could be broken if you reach an agreement.

This is incorrect. The house is owned in full by the land owner unless a proper procedure has taken place in which the owneship of the land and the house have legally been separated and registered at the land office. A contract stating the ownership of the house in not good enough.

This is a common misunderstanding by many Westerners who have 'bought' a house in Thailand with leased land.

Actually it is correct. This has nothing to do with separating land and house. If there is a lease it cannot be broken just because the property is sold. The lease is essentially part of the property and will transfer to the new owner, it is the same for houses and condos.

Image if you are living in a rented property and one day someone shows up at your door and says "i am the new owner, get out"

[BangkokRulez]

Section 569 CCC. A contract of hire of immovable property is not extinguished by the transfer of ownership of the property hired. The transferee is entitled to the rights and is subjected to the duties of the transferor towards the hirer.

[Woodsie888]

Do Thailand banks allow 30 years leases to be registered against the property if it already encumbered to them?

What is the situation if somebody leases a property and then defaults on their mortgage. What are the tenant's rights? Some rights or no rights?

Assuming the bank foreclosed in the event of the landlord defaulting, does the tenant still retain the right to transfer the lease?

I assume the bank would be the new landlord and they would not be keen to do this obviously.

In the Western world, lease assignments can not be unreasonably denied by the landlord in many cases, however TIT.

PS. This question is probably more related to Commercial property, rather than residential although there will be some similar situations I guess.

Edited September 10, 2014 by Woodsie888

[ThaiLawOnline]

Very confusing answers.

1) About transfer by inheritance

The law permits transfer of a leased land provided this right has been entered onto backside of the title deed.

Right on, lease transferable if the info is on the title deed of the property / land.

What is above is COMPLETELY FALSE.

That is NEVER written on a title deed. It is written on a separate sheet made by the land department, explaining conditions of the lease.

And yes, it can be transmissible to heirs if it specifies it.

I have seen leases where it is also specified that it ends with the lessee's death. A good lease will have "succession" and "inheritance" clauses.

We say in civil law that the contract is the law of the parties. Basically, you can add ANYTHING unless it is illegal.

You add something like this: (this lease is more than a lease, and we put 2 renewals but do not guarantee the second renewal. There is also an addendum, a declaration of intention to renew, and another document to complete the lease).

===========================

16. SUCCESSION/ ทรัพย์มรดก

16.1 This Agreement and renewal lease terms under clause 5.2 and 5.3 shall be devolved on the benefit of the successors of the parties.

สัญญาฉบับนี้และการต่ออายุสัญญาการเช่าต่อตามข้อ 5.2 และ ข้อ 5.3 ให้ตกทอดไปยังผู้สืบทอดมรดกของคู่สัญญา

16.2 During the Lease Term, the Second Lease Term or the Third Lease Term, as the case may be if the Lessee dies or disappears, the parties agree and warrant that this Agreement and 2 renewal options shall not be terminated. In this event, the Successor of the Lessee shall automatically enter into this Agreement and for the purpose of the succession, the Lessor shall, within a reasonable period fixed by the Lessee’s successor, register this lease to the name of the Lessee’s successor at the relevant land office for a remaining period of the Lease Term with the 2 renewal options, specified in clause 5.2 and 5.3. All the terms and conditions in this Agreement save for clause 5.1 shall apply to the new registration of the lease.

All of registration fees, duties and other expenses (if any) in relation to the new registration of the lease of the Land shall be borne solely by the Lessee’s Successors.

ในระหว่างอายุสัญญาเช่า ระยะเวลาการเช่าครั้งที่สองหรือระยะเวลาการเช่าครั้งที่สาม แล้วแต่กรณี หากว่าผู้เช่าเสียชีวิตหรือสาบสูญ คู่สัญญาตกลงและรับรองว่าสัญญาฉบับนี้และการต่ออายุการเช่าทั้ง 2 ครั้ง ไม่สามารถยกเลิกได้ ในกรณีนี้ให้ผู้สืบมรดกของผู้เช่าจะเข้ามาผูกพันแทนที่ตามสัญญาเช่าฉบับนี้โดยอัตโนมัติและเพื่อจุดประสงค์ในการสืบมรดกตามข้อนี้ ผู้ให้เช่าจะจดทะเบียนการเช่าใหม่ในนามของผู้สืบมรดกของผู้เช่าสำหรับระยะเวลาการเช่าที่ยังคงเหลืออยู่พร้อมกับการต่ออายุสัญญาเช่าทั้ง 2 ครั้งตามที่ได้ระบุไว้ในข้อ 5.2 และ 5.3 โดยบรรดาข้อตกลงและเงื่อนไขตามสัญญาฉบับนี้จะยังคงใช้บังคับสำหรับการจดทะเบียนการต่ออายุสัญญาเช่าตามข้อนี้ทุกประการ

ผู้สืบมรดกของผู้เช่าจะรับผิดชอบในบรรดาค่าธรรมเนียม อากรแสตมป์ และค่าใช้จ่ายอื่นใดซึ่งเกิดจากการจดทะเบียนเช่าใหม่ (หากมี) แต่เพียงฝ่ายเดียว

===============

2) Transfer like a SUB-LEASE

A lease IS NOT transferable to sublet UNLESS it specifies it.

See clause 544 of the civil code.

Law firms make leases documents but you must double check that the land department DOES register clauses like 'right to sub-lease' for example.

You add a clause like that:

11. SUBLEASE & ASSIGNMENT / การเช่าช่วงและการโอนสิทธิหรือทรัพย์สิน

The Lessee shall have the right to let out the land or any part thereof in any way whether by way of subletting, lending, sharing or other means and to transfer (assign) the lease rights of this agreement in whole or in part to any other person without prior consent of the lessor. The lessor agrees to register the same with the appropriate competent authorities as the Lessee may request. Such transfer of lease right or sublease must not exceed the lease term under the original agreement. Should there be a 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.

ผู้เช่ามีสิทธิที่จะให้เช่าช่วงที่ดินทั้งหมดหรือบางส่วนตามสัญญานี้ไม่ว่าจะเป็นเช่าช่วง ให้ยืม แบ่งหรือรูปแบบอื่นใดและโอน(มอบหมาย) สิทธิเช่าของสัญญาฉบับนี้ทั้งหมดหรือบางส่วนไปยังบุคคลอื่นโดยไม่ ต้องขอความยินยอมล่วงหน้าจากผู้ให้เช่า ผู้ให้เช่าตกลงที่จะจดทะเบียนตามที่ผู้เช่าร้องขอกับเจ้าหน้าที่รัฐ เช่นการโอนสิทธิการเช่าหรือเช่าช่วงซึ่งไม่เกินกว่าระยะเวลาการเช่าภายใต้สัญญาฉบับนี้ ในกรณีที่ต้องจด ทะเบียนหรือดำเนินการด้านนิติกรรม ผู้ให้เช่าตกลงให้ความยินยอมและช่วยเหลือผู้เช่าในการจัดเตรียม เอกสารโดยไม่เรียกร้องสิ่งตอบแทนใดจากผู้เช่า

======================

About registration of a lease if there is encumbrances, it is normally NOT POSSIBLE. I never seen it.

Example, if there is a mortgage. The bank will keep the title deed in pledge and will refuse to register a lease to protect their rights. This is obvious.

======================

Forms of lease are free at the land department but only in Thai and it is not a very good lease. To draft a contract, and personalize it, it not expensive and worths it.

The question is: Is it better a lease or usufruct for you? Why not a mortgage? And superficies? Or setting up a Thai company? Do you want to add a MOU and Wills? each case is different.

[bangkoklawyer24]

Can a land lease really be inherited? No

With all respect, but a "lease inheritance", the automatic transfer of the lease rights to the heirs, if the lessee passes away, is imho not possible under the laws of Thailand. You may agree a lot, but you cannot modify the coverage of your legal estate by an agreement. Therefore, the "succession agreement" is nothing else than a renewal right. It works fine, if the landlord agrees, but fails, if he disagrees. The dependency from the Chanote-owner makes an important difference.

See all the details at https://www.linkedin.com/pulse/article/20140815051558-11220814-zombie-apocalypse-in-thai-property-lease

[mike324]

Very confusing answers.

1) About transfer by inheritance

The law permits transfer of a leased land provided this right has been entered onto backside of the title deed.

Right on, lease transferable if the info is on the title deed of the property / land.

What is above is COMPLETELY FALSE.

That is NEVER written on a title deed. It is written on a separate sheet made by the land department, explaining conditions of the lease.

And yes, it can be transmissible to heirs if it specifies it.

I have seen leases where it is also specified that it ends with the lessee's death. A good lease will have "succession" and "inheritance" clauses.

We say in civil law that the contract is the law of the parties. Basically, you can add ANYTHING unless it is illegal.

You add something like this: (this lease is more than a lease, and we put 2 renewals but do not guarantee the second renewal. There is also an addendum, a declaration of intention to renew, and another document to complete the lease).

===========================

16. SUCCESSION/ ทรัพย์มรดก

16.1 This Agreement and renewal lease terms under clause 5.2 and 5.3 shall be devolved on the benefit of the successors of the parties.

สัญญาฉบับนี้และการต่ออายุสัญญาการเช่าต่อตามข้อ 5.2 และ ข้อ 5.3 ให้ตกทอดไปยังผู้สืบทอดมรดกของคู่สัญญา

16.2 During the Lease Term, the Second Lease Term or the Third Lease Term, as the case may be if the Lessee dies or disappears, the parties agree and warrant that this Agreement and 2 renewal options shall not be terminated. In this event, the Successor of the Lessee shall automatically enter into this Agreement and for the purpose of the succession, the Lessor shall, within a reasonable period fixed by the Lessee’s successor, register this lease to the name of the Lessee’s successor at the relevant land office for a remaining period of the Lease Term with the 2 renewal options, specified in clause 5.2 and 5.3. All the terms and conditions in this Agreement save for clause 5.1 shall apply to the new registration of the lease.

All of registration fees, duties and other expenses (if any) in relation to the new registration of the lease of the Land shall be borne solely by the Lessee’s Successors.

ในระหว่างอายุสัญญาเช่า ระยะเวลาการเช่าครั้งที่สองหรือระยะเวลาการเช่าครั้งที่สาม แล้วแต่กรณี หากว่าผู้เช่าเสียชีวิตหรือสาบสูญ คู่สัญญาตกลงและรับรองว่าสัญญาฉบับนี้และการต่ออายุการเช่าทั้ง 2 ครั้ง ไม่สามารถยกเลิกได้ ในกรณีนี้ให้ผู้สืบมรดกของผู้เช่าจะเข้ามาผูกพันแทนที่ตามสัญญาเช่าฉบับนี้โดยอัตโนมัติและเพื่อจุดประสงค์ในการสืบมรดกตามข้อนี้ ผู้ให้เช่าจะจดทะเบียนการเช่าใหม่ในนามของผู้สืบมรดกของผู้เช่าสำหรับระยะเวลาการเช่าที่ยังคงเหลืออยู่พร้อมกับการต่ออายุสัญญาเช่าทั้ง 2 ครั้งตามที่ได้ระบุไว้ในข้อ 5.2 และ 5.3 โดยบรรดาข้อตกลงและเงื่อนไขตามสัญญาฉบับนี้จะยังคงใช้บังคับสำหรับการจดทะเบียนการต่ออายุสัญญาเช่าตามข้อนี้ทุกประการ

ผู้สืบมรดกของผู้เช่าจะรับผิดชอบในบรรดาค่าธรรมเนียม อากรแสตมป์ และค่าใช้จ่ายอื่นใดซึ่งเกิดจากการจดทะเบียนเช่าใหม่ (หากมี) แต่เพียงฝ่ายเดียว

===============

2) Transfer like a SUB-LEASE

A lease IS NOT transferable to sublet UNLESS it specifies it.

See clause 544 of the civil code.

Law firms make leases documents but you must double check that the land department DOES register clauses like 'right to sub-lease' for example.

You add a clause like that:

11. SUBLEASE & ASSIGNMENT / การเช่าช่วงและการโอนสิทธิหรือทรัพย์สิน

The Lessee shall have the right to let out the land or any part thereof in any way whether by way of subletting, lending, sharing or other means and to transfer (assign) the lease rights of this agreement in whole or in part to any other person without prior consent of the lessor. The lessor agrees to register the same with the appropriate competent authorities as the Lessee may request. Such transfer of lease right or sublease must not exceed the lease term under the original agreement. Should there be a 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.

ผู้เช่ามีสิทธิที่จะให้เช่าช่วงที่ดินทั้งหมดหรือบางส่วนตามสัญญานี้ไม่ว่าจะเป็นเช่าช่วง ให้ยืม แบ่งหรือรูปแบบอื่นใดและโอน(มอบหมาย) สิทธิเช่าของสัญญาฉบับนี้ทั้งหมดหรือบางส่วนไปยังบุคคลอื่นโดยไม่ ต้องขอความยินยอมล่วงหน้าจากผู้ให้เช่า ผู้ให้เช่าตกลงที่จะจดทะเบียนตามที่ผู้เช่าร้องขอกับเจ้าหน้าที่รัฐ เช่นการโอนสิทธิการเช่าหรือเช่าช่วงซึ่งไม่เกินกว่าระยะเวลาการเช่าภายใต้สัญญาฉบับนี้ ในกรณีที่ต้องจด ทะเบียนหรือดำเนินการด้านนิติกรรม ผู้ให้เช่าตกลงให้ความยินยอมและช่วยเหลือผู้เช่าในการจัดเตรียม เอกสารโดยไม่เรียกร้องสิ่งตอบแทนใดจากผู้เช่า

======================

About registration of a lease if there is encumbrances, it is normally NOT POSSIBLE. I never seen it.

Example, if there is a mortgage. The bank will keep the title deed in pledge and will refuse to register a lease to protect their rights. This is obvious.

======================

Forms of lease are free at the land department but only in Thai and it is not a very good lease. To draft a contract, and personalize it, it not expensive and worths it.

The question is: Is it better a lease or usufruct for you? Why not a mortgage? And superficies? Or setting up a Thai company? Do you want to add a MOU and Wills? each case is different.

thank you for the correction mr. lawyer, excuse me for not using the proper terminology, it is written on the contract like you said. I believe its actually only a contract you sign and get verify by the land department, do you even see the title?

I did a quick search the company Siam Legal seems to be saying you do get your name on the title deed.

[bangkoklawyer24]

I did a quick search the company Siam Legal seems to be saying you do get your name on the title deed.

Siam Legal says that you can't inherit the lease rights :-)

http://www.lawyer-phuket.com/lease-agreements-in-thailand

[tomme]

Lease contract;

Landowner and landoffice has one original chanot each (two originals).

Lessee, Landowner and landoffice have one original written lease contract each (three originals) done by landoffice.

Tenant has he’s/her name on the backside of the two original chanots (landowner and landoffice)

Rules about the lease must be stated on the lease contract; transferable, inherit, lease period, lease payments etc.

It’s also possible to attach a contract between the lessee and the landlord on the backside of the landoffice chanot, if the contract rules are permitted by the landoffice.

Woodsie888

“About registration of a lease if there is encumbrances, it is normally NOT POSSIBLE. I never seen it. Example, if there is a mortgage. The bank will keep the title deed in pledge and will refuse to register a lease to protect their rights. This is obvious.”

I’ve seen it; If the landowner and the tenant has not requested or got an approval from the bank (lender), Landoffice require the lessee to sign a document before they write the lease contract, the document say; Land Office disclaims any liability with the lease. The meaning of the contract is that the lessee has no right to object if the bank (lender) would like to claim the property and cancel the lease.

Inherit;

If it is written on the three original lease contracts; yes, I’ve only seen it done with the consent of the landlord, to inherit without the consent of the landlord is for sure not easy, to give a good answer of the outcome anyone should check former court cases to answer correct.

In case of inherit; the lease contract will stay as it is in the deiced name, but on the backside of the two original chanots it will say that the lease is passed on to the inherit part.

T

Edited September 14, 2014 by tomme

[AnotherOneAmerican]

Do Thailand banks allow 30 years leases to be registered against the property if it already encumbered to them?

What is the situation if somebody leases a property and then defaults on their mortgage. What are the tenant's rights? Some rights or no rights?

Assuming the bank foreclosed in the event of the landlord defaulting, does the tenant still retain the right to transfer the lease?

I assume the bank would be the new landlord and they would not be keen to do this obviously.

In the Western world, lease assignments can not be unreasonably denied by the landlord in many cases, however TIT.

PS. This question is probably more related to Commercial property, rather than residential although there will be some similar situations I guess.

Bank won't allow lease, so doesn't happen.

[Woodsie888]

Do Thailand banks allow 30 years leases to be registered against the property if it already encumbered to them?

What is the situation if somebody leases a property and then defaults on their mortgage. What are the tenant's rights? Some rights or no rights?

Assuming the bank foreclosed in the event of the landlord defaulting, does the tenant still retain the right to transfer the lease?

I assume the bank would be the new landlord and they would not be keen to do this obviously.

In the Western world, lease assignments can not be unreasonably denied by the landlord in many cases, however TIT.

PS. This question is probably more related to Commercial property, rather than residential although there will be some similar situations I guess.

Bank won't allow lease, so doesn't happen.

Interesting. Very unusual that all leased commercial property is owned free and clear of encumbrance in Thailand. Considering the value of most downtown office / retail developments and the number of them owned by individuals, it really does demonstrate how wealthy some of these people are. Must be the reason REIT's are becoming fashionable in BKK nowadays.