My House Is Finally Transferred

[Mobi]

Well it took a couple of weeks, 3 very long days at the Land department, and an absolute mountain of paperwork, but finally I have succeeded in accomplishing the following:

• Removed myself as a MD/Director/shareholder of my 49/51% house owning company

• Transferred my 49% shareholding to my wife, who also replaced me as MD

• Transferred the 51% “nominee” shareholders to friendly, “joint venture” shareholders.

• Transferred my wife’s shareholding to her brother, who also replaced her as MD

• Transferred the land owned by the company into my wife’s sole name.

• Transferred the house owned by the company into my wife’s sole name.

• Land department issued a lifetime usufruct, granting me security of tenure and control over the property until I die.

Still to be done:

• Change the tabian bahn into my wife’s name

• Obtain a “yellow Book” for my residence.

• Get the wife to sign a new will, making me the beneficiary of the property if she dies before me.

• Close the company.

A few comments:

• The first 3 of the 4 things still to be done should be accomplished next week.

• The company closure will take about 2 years.

• I had a particular set of issues and problems that needed to be dealt with and resolved. Others may have more or less issues, so the above process and time line may not be the same for them.

• We came across a very obnoxious land officer who was very anti-farang, and thought he could make up his own rules. He regaled my wife to such an extent that at one point she was convinced I was trying to cheat her, and wanted out of the whole deal. In the end… it was down to the usual thing….

• Clearly not all land offices, or officers, are the same.

• Sunbelt performed a professional service and were totally supportive and helpful throughout the process. They stuck to their guns and we got there in the end. I honestly doubt if any other company could have done any better, given Sunbelt’s experience in this sector, and I would imagine most would have floundered badly.

• Sunbelt's charges were reasonable. But don't forget there is also the tax payable on the transfers, which should be factored in if you are considering going through this process. I also paid tax on the Usufruct - which is unusual, but it was part of the overall deal.

But no more company fees, annual audits, company tax, "Thai Lawyers", or minority shareholders to come back and haunt me, to say nothing of the Commerce Department who may want to know more about the "nominees" and investigate what buisiness the company is doing.

Tonight I will sleep easy.

Thanks Greg

[GuestHouse]

Great news, thanks for the update.

Well done Sunbelt, nothing like a happy customer to bring in more recommeded business. Would that others learn the lesson.

[Sunbelt Asia]

Well it took a couple of weeks, 3 very long days at the Land department, and an absolute mountain of paperwork, but finally I have succeeded in accomplishing the following:

• Removed myself as a MD/Director/shareholder of my 49/51% house owning company

• Transferred my 49% shareholding to my wife, who also replaced me as MD

• Transferred the 51% “nominee” shareholders to friendly, “joint venture” shareholders.

• Transferred my wife’s shareholding to her brother, who also replaced her as MD

• Transferred the land owned by the company into my wife’s sole name.

• Transferred the house owned by the company into my wife’s sole name.

• Land department issued a lifetime usufruct, granting me security of tenure and control over the property until I die.

Still to be done:

• Change the tabian bahn into my wife’s name

• Obtain a “yellow Book” for my residence.

• Get the wife to sign a new will, making me the beneficiary of the property if she dies before me.

• Close the company.

A few comments:

• The first 3 of the 4 things still to be done should be accomplished next week.

• The company closure will take about 2 years.

• I had a particular set of issues and problems that needed to be dealt with and resolved. Others may have more or less issues, so the above process and time line may not be the same for them.

• We came across a very obnoxious land officer who was very anti-farang, and thought he could make up his own rules. He regaled my wife to such an extent that at one point she was convinced I was trying to cheat her, and wanted out of the whole deal. In the end… it was down to the usual thing….

• Clearly not all land offices, or officers, are the same.

• Sunbelt performed a professional service and were totally supportive and helpful throughout the process. They stuck to their guns and we got there in the end. I honestly doubt if any other company could have done any better, given Sunbelt’s experience in this sector, and I would imagine most would have floundered badly.

• Sunbelt's charges were reasonable. But don't forget there is also the tax payable on the transfers, which should be factored in if you are considering going through this process. I also paid tax on the Usufruct - which is unusual, but it was part of the overall deal.

But no more company fees, annual audits, company tax, "Thai Lawyers", or minority shareholders to come back and haunt me, to say nothing of the Commerce Department who may want to know more about the "nominees" and investigate what buisiness the company is doing.

Tonight I will sleep easy.

Thanks Greg

Thanks Mobi D'Ark

Bad luck on the very obnoxious land officer but we overcame it.

It was our staffs and my pleasure working with you. Everything left will go smooth. Will contact you on the company, we have good news.

www.sunbeltasiagroup.com

[cclub75]

But no more company fees, annual audits, company tax, "Thai Lawyers", or minority shareholders to come back and haunt me, to say nothing of the Commerce Department who may want to know more about the "nominees" and investigate what buisiness the company is doing.

Tonight I will sleep easy.

I bet you will.

Congratulations for your perseverance !

Next step : taking care of the visa situation.

No, i'm joking.

What a country.

[kayo]

Well done Mobi!

Good to get things done.

[thaigene2]

Yes congratulations. Bitter experience with the Land Office guy..but a lesson for us all. Thanks for updating us. The old expression could never be more true - Keep it simple. Buy a condo, or put the house in your wife's name, with a lease or usufruct.

[Nadia 2]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

[Jeff1]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

If the usufruct is not as secure as it seems, please tell me what is the best way. If there is one.

[Mobi]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

Thanks Nadia.

I wouldn't dream of arguing with you but I have no doubt that Sunbelt would. They have argued very long and very vociferously that usufructs are absolotely water tight, and they can quote all the relevant case law that , in their opinion, backs up their standpoint on this.

As a matter of interest. my Usufruct was not free, so was no gift. Sunbelt could provide the exact figures, but I paid tax of 4,525 Baht based on an annual rental calculation based on the type of house and my life expectancy. The Usufruct has been stamped up by the land office and registered on the Chanod.

I feel pretty safe, even if I subsequently become divorced, which God forbid will never happen

[chownah]

Great news on the usurfruct front!!!! Now....if Sunbelt could just arrange some kind of usurfruct deal with the immigration people............

[Pilchard]

Hi mobi, Glad to hear you found a solution that works for you.

Do you know why it takes so long to close the company down ?

I guess you have to keep paying fee's of some sort until it's finally gone, any idea how much ?

[~G~]

• Get the wife to sign a new will, making me the beneficiary of the property if she dies before me.

How can such a will be legal if you cannot own the property?

[Sunbelt Asia]

• Get the wife to sign a new will, making me the beneficiary of the property if she dies before me.

How can such a will be legal if you cannot own the property?

Under Section 93.- of the Land Code, a foreigner is entitled to inheritance of land as a statutory heir. However, the registration for the ownership of land by aforesaid foreigner must be approved by the Minister of Interior. The area of land approved accordingly must not exceed the area specified by Section 87

Section 87.- The area of land a foreigner can own in accordance with the foregoing Section will be as follows :-

1) Residential Purpose per family - 1 rai

2) Commercial Purpose - 1 rai

3) Industrial Purpose - 10 rais

4) Agricultural Purpose - 10 rais

5) Religious Purpose - 1 rai

6) Charitable Purpose - 1 rai

7) Cemetery Purpose - 1/2 rai

If a foreigner desires to have ownership of land for industrial purpose more than an area prescribed in 3) and the cabinet deems expedient, the cabinet may grant permission to the said foreigner to own the land with the area more than the prescribed area by imposing conditions and Section 48. - shall be applied mutatis mutandis.

If the Minister of Interior does not give you the right to own the land, you have one year to live there before it is sold or transferred to a Thai national. However the useufruct is still valid and you do not need to move. anyone buying it would find the value below market value as they have to honor the usufruct with you. Of course, any money received would be yours if the will stated as such.

www.sunbeltasiagroup.com

[Mobi]

Thankyou Sunbelt, I couldn't have explained it better myself

Another point, maybe obvious, is that if I did decide to sell, and I decided to"surrender" or cancel the usufruct, then of course I could get market value for the sale.

All highly hypothetical, given the age disparity and my state of health

[Sunbelt Asia]

Thankyou Sunbelt, I couldn't have explained it better myself

Another point, maybe obvious, is that if I did decide to sell, and I decided to"surrender" or cancel the usufruct, then of course I could get market value for the sale.

All highly hypothetical, given the age disparity and my state of health

Long live Mobi! You are going to be a long long time.

[sakaew]

Thanks for the info Mobi

Was the deed done by Sunbelt Bangkok?

Or by their Pattaya office ?

[~G~]

• Land department issued a lifetime usufruct, granting me security of tenure and control over the property until I die.

The "Lifetime" period is a strange one. What happens if you are out of Thailand, how can anyone establish whether you are dead or alive?

[Dragonman]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

I generally agree. Whilst never having doubted that the Land Office would register the Lifetime Usufruct, as outlined in thai law,( they also had no problem with Companies before ) the legality for foreigners is indeed doubtful. Only the Supreme Court will clarify. I have no doubt a 30 year leasehold would be upheld as legal, and is in fact the only interest mentioned in Amity. It has also been discussed in Senate.

Good luck anyway Mobi. Try to make sure your marriage stays secure as I'd hate to quote Supreme Court 1/2008 Mobi v Mrs Mobi.

[thaigene2]

Another point, maybe obvious, is that if I did decide to sell, and I decided to"surrender" or cancel the usufruct, then of course I could get market value for the sale.

Again congratulations Mobi.

But I don't follow the logic in your quote above. Bearing in mind that under the law you would have only one year to sell that property, the "market value" would actually be artificially pretty low - especially if the potential Thai buyer (who don't usually like to buy 'used' homes) figured out that you were under the gun to get rid of it. Seems to me you'd be a 'distressed' seller.

But maybe I'm wrong..

[Nadia 2]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

I generally agree. Whilst never having doubted that the Land Office would register the Lifetime Usufruct, as outlined in thai law,( they also had no problem with Companies before ) the legality for foreigners is indeed doubtful. Only the Supreme Court will clarify. I have no doubt a 30 year leasehold would be upheld as legal, and is in fact the only interest mentioned in Amity. It has also been discussed in Senate.

Good luck anyway Mobi. Try to make sure your marriage stays secure as I'd hate to quote Supreme Court 1/2008 Mobi v Mrs Mobi.

I did not want to question the legality of a 30 year lease or usufruct in a foreigner's name, but only how valid are these kind of agreements between husband and wife entered into during their marriage under Thai law...

[Dragonman]

One note : A usufruct 'for free' as a construction to protect a surviving (foreign) spouse seems okay, however, get divorced in the meantime the usufruct (or lease) could easily be voided. In my opnion, agreements (or gifts) between husband and wife entered into during a marriage - with a few exceptions - are in general very doubtful if not void.

A lease or usufruct to protect the foreign spouse's interest in the land may not be as secure as it seems.

I generally agree. Whilst never having doubted that the Land Office would register the Lifetime Usufruct, as outlined in thai law,( they also had no problem with Companies before ) the legality for foreigners is indeed doubtful. Only the Supreme Court will clarify. I have no doubt a 30 year leasehold would be upheld as legal, and is in fact the only interest mentioned in Amity. It has also been discussed in Senate.

Good luck anyway Mobi. Try to make sure your marriage stays secure as I'd hate to quote Supreme Court 1/2008 Mobi v Mrs Mobi.

I did not want to question the legality of a 30 year lease or usufruct in a foreigner's name, but only how valid are these kind of agreements between husband and wife entered into during their marriage under Thai law...

Strictly speaking under the Land Code the Officer should have requested Ministerial confirmation. Particularly as Mobi has intimated that The Officer practically convinced his wife he was cheating her. This would inevitably come out in any Court Case. As I have stated previously, the wife should have an independent lawyer to negate this charge, and for her to understand that she may never have the right to occupy her own property on divorce. Anything less may end in a mess for everyone.

[Mobi]

Thanks Dragonman, Nadia 2, and all the others who have tried their best to lessen my feelings of well being and security - indoubtedly with the best of motives I might add.

I am not a lawyer, but during my 60 years on this planet have had dealings with a great many of those particular beings, from crooked little ones in creepy offices, to the best corporate lawyers that money can buy, and during my career have spent countless hours sitting down with and negotiating with lawyers on all manner of legal issues. So I'm not a total dumb dumb.

When I decided to get my personal property matters sorted, I thought long and hard as to who would be the best people to do this for me. Part of me said that I should go to one of the high priced, farang law firms in Bangkok, as maybe they would be the only ones I could truly trust, and could be relied upon to follow every letter of the law. But then I thought about having to go down to some grimy, sweatbox of a land office in some seedy suburb of Pattaya, and I just couldn't imagine that one of these hotshot international law firms would exactly have the staff, the 'streetwise-ness', and wherewithall to accomplish what I wanted to do.

I have been extremely impressed with the integrity and professionalism displayed by Sunbelt, who are clearly the leader in this area of law, and opted to use them. Since I have become their client, I am confident that everything that they have done, said or written - either to me or on this forum - is work of the highest standards, and that they are people of the utmost integrity and that their knowledge of the law in this area is probably second to none.

I appreciate the various points that you guys have been making, but at the end of the day, I hired a top bunch of professionals, with expertise in this area, and if they say everything is kosher , then that's fine with me, and I will most definitely sleep easy from here on in.

divorce or no divorce.

Edited September 15, 2006 by Mobi D'Ark

[Mobi]

Thanks for the info Mobi

Was the deed done by Sunbelt Bangkok?

Or by their Pattaya office ?

It was handles and managed out of Bangkok, with their Pattaya staff used to attend the land office and commercial dept.

[Dragonman]

To get my head around this more, as Mobi is obviously pleased with your work, could you clarify your legal opinions on whether "unjust enrichment" may come into play, or if, on divorce, the capital value of any usufruct would be used as a basis for "community property".

[Sunbelt Asia]

I have been extremely impressed with the integrity and professionalism displayed by Sunbelt, who are clearly the leader in this area of law, and opted to use them. Since I have become their client, I am confident that everything that they have done, said or written - either to me or on this forum - is work of the highest standards, and that they are people of the utmost integrity and that their knowledge of the law in this area is probably second to none.

Thanks for the kind words.

Strictly speaking under the Land Code the Officer should have requested Ministerial confirmation. Particularly as Mobi has intimated that The Officer practically convinced his wife he was cheating her. This would inevitably come out in any Court Case. As I have stated previously, the wife should have an independent lawyer to negate this charge, and for her to understand that she may never have the right to occupy her own property on divorce. Anything less may end in a mess for everyone.

This was covered with a seperate two page “Statement in Support of Usufruct Contract” drafted by another licensed lawyer and not connected in anyway with representing Mr. Mobi. It was read by Mrs. Mobi, had it explained by another legal staff to be sure she understood the rights she was giving Mr. Mobu and it was signed by her.

The big issue that the Land Officer was yapping about, was Mr. Mobi could transfer the rights to "another woman" and she couldn't do anything about it. Understandably this upset Mrs. Mobi. Of course “another woman” living in "her" house was out of the question.

This scenario, he portrayed was not exactly true if it was a lease or transfer of the rights over three years, this then would require Mrs. Mobi to bring the Chanote to the Land Office to register the transfer to the "other woman" The Land officer try to convince her, it was likely to happen and this is how she was being cheated. After all this explanation, she registered a usufruct for her husband.

Ironically, the most common form of usufruct in the French Civil Code usufruct is giving rights to the surviving (second) spouse. As the land is inherited by the kids of the first marriage but gives the (second) spouse the right to live there till after their death The surviving spouse has a legal usufruct over the deceased spouse's share of community property even though the children are considered to have inherited the property and are the naked owners.

www.sunbeltasiagroup.com

[Dragonman]

I have been extremely impressed with the integrity and professionalism displayed by Sunbelt, who are clearly the leader in this area of law, and opted to use them. Since I have become their client, I am confident that everything that they have done, said or written - either to me or on this forum - is work of the highest standards, and that they are people of the utmost integrity and that their knowledge of the law in this area is probably second to none.

Thanks for the kind words.

Strictly speaking under the Land Code the Officer should have requested Ministerial confirmation. Particularly as Mobi has intimated that The Officer practically convinced his wife he was cheating her. This would inevitably come out in any Court Case. As I have stated previously, the wife should have an independent lawyer to negate this charge, and for her to understand that she may never have the right to occupy her own property on divorce. Anything less may end in a mess for everyone.

This was covered with a seperate two page “Statement in Support of Usufruct Contract” drafted by another licensed lawyer and not connected in anyway with representing Mr. Mobi. It was read by Mrs. Mobi, had it explained by another legal staff to be sure she understood the rights she was giving Mr. Mobu and it was signed by her.

The big issue that the Land Officer was yapping about, was Mr. Mobi could transfer the rights to "another woman" and she couldn't do anything about it. Understandably this upset Mrs. Mobi. Of course “another woman” living in "her" house was out of the question.

This scenario, he portrayed was not exactly true if it was a lease or transfer of the rights over three years, this then would require Mrs. Mobi to bring the Chanote to the Land Office to register the transfer to the "other woman" The Land officer try to convince her, it was likely to happen and this is how she was being cheated. After all this explanation, she registered a usufruct for her husband.

Ironically, the most common form of usufruct in the French Civil Code usufruct is giving rights to the surviving (second) spouse. As the land is inherited by the kids of the first marriage but gives the (second) spouse the right to live there till after their death The surviving spouse has a legal usufruct over the deceased spouse's share of community property even though the children are considered to have inherited the property and are the naked owners.

www.sunbeltasiagroup.com

Good, I am happy that a usufruct is not simply registered on the chanote, as has happened previously, and that the 2 page support document was initiated. Too many people treat it lightly and do not realise the importance of correct documentation and inventory. Whilst it is a matter of debate about the outcome of a Supreme Court decision, at least Legal Advice cannot be questioned about dotting all the i's and crossing all the t's. If this is the way people decide to go, at least it appears to be well undertaken, in order to minimise the level of legal challenge.

[Sunbelt Asia]

To get my head around this more, as Mobi is obviously pleased with your work, could you clarify your legal opinions on whether "unjust enrichment" may come into play, or if, on divorce, the capital value of any usufruct would be used as a basis for "community property".

I asked Mrs. Mobi legal representation to comment on this:

It is a complicated legal principle about which entire volumes of books have been written (literally)! It is an "equitable remedy" as opposed to a "legal remedy." An equitable remedy basically is something the court makes up when there are no adequate provisions at law. Thailand is a civil code country which, by definition, does not adhere to strict rules of following judicial precedent.

There is no way to protect against somebody suing you and claiming that a contract was not fair for some reason or another. Even, for the sake of argument, if the usufruct was found to be a "gift", a valid gift is as enforceable as any contract or agreement. The argument might be made that the usufruct was the result of duress, undue influence, or mistake. In that case, Sunbelt had recommended independent council draft the execution of a separate document, in affidavit form, and witnessed that the grantor of the usufruct has done so without undue influence or duress and explains exactly what rights the usefructuary has.

I would just emphasize that the real danger in challenging the usufruct would come in the form of asserting undue influence or duress and my separate document drafted for the wife ” my client” has provided for that.

As for whether any gain in the value of the usufruct would be community property, prenuptial agreements specifically state that unrealized gains will be excluded from inclusion as community property. Of course, like any contract it is subject to interpretation and revision by the courts.

Good, I am happy that a usufruct is not simply registered on the chanote, as has happened previously, and that the 2 page support document was initiated. Too many people treat it lightly and do not realise the importance of correct documentation and inventory. Whilst it is a matter of debate about the outcome of a Supreme Court decision, at least Legal Advice cannot be questioned about dotting all the i's and crossing all the t's. If this is the way people decide to go, at least it appears to be well undertaken, in order to minimise the level of legal challenge.

Thank you.

www.sunbeltasiagroup.com

[JimmyGreaves]

But no more company fees, annual audits, company tax, "Thai Lawyers", or minority shareholders to come back and haunt me, to say nothing of the Commerce Department who may want to know more about the "nominees" and investigate what buisiness the company is doing.

Tonight I will sleep easy.

Thanks Greg

Congratulations Mobi, It's good to hear from someone who is content with a job well done and who has organised the whole procedure successfully!

Mobi, were you trading at all? How much per annum did holding your land/house via the company route cost you in:

• Company Fees
  
• Company Tax
  
• Did You have annual audits, if so what was the cost.