Usufruct

[rio bryan]

i may be sounding a bit thick here but what is the difference between a usufruct and a 30 year lease apart from the time span ?

[sinam]

i may be sounding a bit thick here but what is the difference between a usufruct and a 30 year lease apart from the time span ?

Big picture: One is for life and the other for 30 years.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

Si Nam

[Sunbelt Asia]

i may be sounding a bit thick here but what is the difference between a usufruct and a 30 year lease apart from the time span ?

A 30 year lease requires you to cxl your lease to transfer your leasehold rights( which involves the Land owner). This Land owner will want money for doing this in most cases. If you sublease, under the civil commercial code, it requires the owners approval. Even though you have a lease, the land can still be sold or transfer, although they must honor the 30 year term( but no 30 year renewal)

The usufruct is a right granted by an owner of land in favor of a usufructuary whereby the usufructuary has the right to possess, use and enjoy the benefits of the property. The usefructuary can also have the right of management of the property.

A usufruct may be created for your natural life. You also can lease the land to a third party which would not end if you died. Example: If you died, you can lease out the property to a third party before your demise as per the Supreme Court ruling 2297/1998; 'the lessor does not have to be the owner of the property. Therefore the usefructuary can rent out the land. Although in the event of death of the usefructuary within the lease term, only the usufruct will be terminated but not also the lease'.

This way, a thirty year lease ( third party…only can be granted a maximum of thirty years) This could be passed on to your children or other relative even though you have died. (As long as the lease was done before you died) The owner of the land must bring the chanote to the Land dept, to allow the lease or transfer of the rights, if it is longer than 3 years.

With the usufruct, you are registered on the title deed. The land can never be sold or transferred by the owner of the land until the servitude is terminated. You can also get a yellow book which is a House Registration Certificate ( Thor. Ror 13)

The usufruct would be registered with a 1.5% tax of the value of the benefit Our firm charges 9,500 for the drafting of the agreement, 8,500 for registration of the usufruct, House Registration Certificate( yellow book Thor Ror 13) professional registration fees are 8,800 Baht.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

I respectfully disagree with you on that. The usufruct would require a professional much more than a 30 year lease with the drafting and getting it approved at the land office. Both contracts should be drafted by a professional at the very least.

www.sunbeltasiagroup.com

[Dragonman]

.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

I respectfully disagree with you on that. The usufruct would require a professional much more than a 30 year lease with the drafting and getting it approved at the land office. Both contracts should be drafted by a professional at the very least.

www.sunbeltasiagroup.com

Yes, some Land Offices will register the usufruct for nominal sum. No contract, no inventory, etc.

However if anyone goes down this route without professional help they may as well get their wife, or whoever, to promise not to throw them out. I am no supporter of lifetime usufructs for foreigners in Thailand, but if you wish to register such, get as much help as you can. Don't forget it is unlikely that Somchai at the Land Office will have a clue about Contract Law.

[rotherham7]

.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

I respectfully disagree with you on that. The usufruct would require a professional much more than a 30 year lease with the drafting and getting it approved at the land office. Both contracts should be drafted by a professional at the very least.

www.sunbeltasiagroup.com

Yes, some Land Offices will register the usufruct for nominal sum. No contract, no inventory, etc.

However if anyone goes down this route without professional help they may as well get their wife, or whoever, to promise not to throw them out. I am no supporter of lifetime usufructs for foreigners in Thailand, but if you wish to register such, get as much help as you can. Don't forget it is unlikely that Somchai at the Land Office will have a clue about Contract Law.

[rotherham7]

dragonman,

Why are you not a supporter of usufructs.I am buying a property in HH and would like a legal method that offers me the best protection.

[Khun Jean]

i may be sounding a bit thick here but what is the difference between a usufruct and a 30 year lease apart from the time span ?

Big picture: One is for life and the other for 30 years.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

Si Nam

The devil is indeed in the detail.

But you got it the other way around. A 30 year lease is easy and a usefruct needs much more detail and for that you need professional help.

Especially when the landowner is your spouse.

[Dragonman]

dragonman,

Why are you not a supporter of usufructs.I am buying a property in HH and would like a legal method that offers me the best protection.

It is not usufructs per se, but lifetime usufructs in Thailand. 30 year usufructs are in my opinion OK, but then why bother, as you may obtain a lease for the same term. Lifetime usufructs for foreigners as a subject has not yet received a Supreme Court decision. The intended use of usufructs originally, especially in Thailand, was to give the poor farmers some protection when growing produce. This was because either the King or the State owned all the land. In fact in some countries it is only allowed to have usufructs on State owned land.

Perhaps I just have an inherent dislike for the originally Roman Law which is established in countries where there was a desire to keep everything within the power of the Crown or Dictatorships.

The whole idea of lifetime usufructs in my opinion goes against the "spirit of the law". The wife owns the land "ring fenced" by virtue of the Constitutional Court ruling regarding community assets. The husband signs to say he agrees. But she then gives him total control of the land for possibly lifetime + 30 year lease, which obviously has a value nearly as much as the freehold value. All this to no advantage of the wife. Whilst this is a great deal for the foreigner. I have always believed interpretation of the Law should be decided on fairness. It is too bad if foreigners think the current laws regarding ownership is unfair to them. It is the Law.

[sinam]

The devil is indeed in the detail.

But you got it the other way around. A 30 year lease is easy and a usefruct needs much more detail and for that you need professional help.

Especially when the landowner is your spouse.

Speaking of spouses a new mate of mine who happens to have a spouse, told me he went in to see a lawyer last week and for a tidy sum the lawyer ended up telling him to forget about the lease route with a spouse as it may not hold up in court (in a spouse context). The lawyer didn't even mention anything about a usufruct. Usufructs seem to be getting some attention now especially since some lawyers have found a way to place themselves in the process. I think the spirit of the law is foreigners can't own land and trying to find the holy grail of loopholes is really just making lawyers more wealthy (or able to pay the bills :-) as they move clients from one loophole to another loophole that may ultimately get plugged or maybe even never was. Of course you can always hope you might get grand fathered in somehow if in fact there is a legal loophole which some seem confident in and even I hope may exist.

Si Nam

[~G~]

Dragonman, maybe you can answer a question I asked in another thread:

What happens if the foreigner is out of Thailand, and the land owner cannot verify whether he is dead or alive.

Theorectically, with no evidence, when will the land owner finally regain his control over the land, if ever?

[Sunbelt Asia]

It is too bad if foreigners think the current laws regarding ownership is unfair to them. It is the Law.

Agreed. It is the law.

It also is the law that the usefructuary is entitled to the possession, use and enjoyment of the property. He also has the right of management of the property. However, no matter how expansive the rights the foreign right holder has to the land during the term, the foreigner does not own any interest in the land, which he has stated in the declaration with his wife. This is a very important dissimilarity and it’s not violating the "spirit of the law" in the Land Act.

Speaking of spouses a new mate of mine who happens to have a spouse, told me he went in to see a lawyer last week and for a tidy sum the lawyer ended up telling him to forget about the lease route with a spouse as it may not hold up in court (in a spouse context)

What route did he recommend then?

The lawyer didn't even mention anything about a usufruct. Usufructs seem to be getting some attention now especially since some lawyers have found a way to place themselves in the process. I think the spirit of the law is foreigners can't own land and trying to find the holy grail of loopholes is really just making lawyers more wealthy (or able to pay the bills :-) as they move clients from one loophole to another loophole that may ultimately get plugged or maybe even never was. Of course you can always hope you might get grand fathered in somehow if in fact there is a legal loophole which some seem confident in and even I hope may exist.

Loophole?

It is 2 1/2 pages long in the Civil Commercial Code. We just followed the principle, - “Foreigners can do anything a Thai can do, except where there is a restriction imposed by the Thai laws.” Find any restriction that says a servitude is not for foreigners.

We get paid to do the best to protect our clients and we do that.

No matter what you do, you can get hammered on lease or a servitude. Once I said lease and didn't write servitude and blasted why would you be so stupid not doing a superficies or usufruct? any lawyer can have an argument on the other side.

So that’s why I would like to know, if it wasn't a lease or usufruct, how did the lawyer protect your friend after paying him a tidy sum? It was something like give power of attorney to the lawyer, right?

www.sunbeltasiagroup.com

[Ralph56]

i may be sounding a bit thick here but what is the difference between a usufruct and a 30 year lease apart from the time span ?

Big picture: One is for life and the other for 30 years.

The devil in the detail: The usufruct you seem to be able to do yourself for a nominal fee and the lease you may need to pay some professionals to help you out. Other than that from some of the stuff I've been reading on this site and others, the lawyers seem to be making it up as they go along :-)

Si Nam

There is really no substitute for good legal representation. Government officials can and often do give bad advice whether on purpose or by accident. That is not to say that lawyers don't also give bad advice sometimes, everyone is human. It is sometimes worth it to pay a few thousand baht to let a professional take care of something in a few minutes rather than spend hours (or days) doing it myself. In the end, I may have saved a few thousand baht, but I wasted a few days.

That's just my opinion though. Maybe it's just getting older I'd rather have the time then the money!

[Dragonman]

It is too bad if foreigners think the current laws regarding ownership is unfair to them. It is the Law.

Agreed. It is the law.

It also is the law that the usefructuary is entitled to the possession, use and enjoyment of the property. He also has the right of management of the property. However, no matter how expansive the rights the foreign right holder has to the land during the term, the foreigner does not own any interest in the land, which he has stated in the declaration with his wife. This is a very important dissimilarity and it’s not violating the "spirit of the law" in the Land Act.

It is 2 1/2 pages long in the Civil Commercial Code. We just followed the principle, - “Foreigners can do anything a Thai can do, except where there is a restriction imposed by the Thai laws.” Find any restriction that says a servitude is not for foreigners.

We get paid to do the best to protect our clients and we do that.

No matter what you do, you can get hammered on lease or a servitude. Once I said lease and didn't write servitude and blasted why would you be so stupid not doing a superficies or usufruct? any lawyer can have an argument on the other side.

So that’s why I would like to know, if it wasn't a lease or usufruct, how did the lawyer protect your friend after paying him a tidy sum? It was something like give power of attorney to the lawyer, right?

www.sunbeltasiagroup.com

I agree with the principles of legality under the word of law, which has a greater effect in Civil Code countries than in Common Law. However in most Property Law decisions in the world, "ownership" has been defined differently by Court Case. Including what the Judge believes to be a "long term"possession. Totally subjective of course.

I see nothing wrong in following up on usufructs as long as you don't set your heart on "lifetime".

[sbk]

Just curious, what happens if a foreigner has a usufruct on land their spouse owns and the spouse dies leaving the foreigner the beneficiary. I realize that the foreign spouse has one year to sell the inherited property but what about the usufruct?

And no, I am not planning on killing my husband

[Sunbelt Asia]

Just curious, what happens if a foreigner has a usufruct on land their spouse owns and the spouse dies leaving the foreigner the beneficiary. I realize that the foreign spouse has one year to sell the inherited property but what about the usufruct?

The usefructuary is still valid. The new owner of the land would have to honor the usufruct.

www.sunbeltasiagroup.com

[Dragonman]

Just curious, what happens if a foreigner has a usufruct on land their spouse owns and the spouse dies leaving the foreigner the beneficiary. I realize that the foreign spouse has one year to sell the inherited property but what about the usufruct?

The usefructuary is still valid. The new owner of the land would have to honor the usufruct.

www.sunbeltasiagroup.com

The difficulty of course would be in finding anyone who would pay you anything for the property, with a reasonably youthful sbk on the property for life . I'd pay a couple of hundred baht on a sort of lottery that you'd "pop off" pretty quickly after the sale.

[tom yum goong]

just curious

I've only heard of people using usufructs with their spouse. is it possible to do this with other parties?

if so, and usufruct is as watertight as Sunbelt says, why would anyone go down the leasehold route?

thanks

[astral]

Just curious, what happens if a foreigner has a usufruct on land their spouse owns and the spouse dies leaving the foreigner the beneficiary. I realize that the foreign spouse has one year to sell the inherited property but what about the usufruct?

You are assuming the spouse inherits.

If he is selling he has not rights beyond the date of sale.

However the property may pass to a surviving child, in which case the ufstrct will remain/die??

Interesting question

And no, I am not planning on killing my husband

Thai wives and mothers in law have been know to do so.

[Dragonman]

Dragonman, maybe you can answer a question I asked in another thread:

What happens if the foreigner is out of Thailand, and the land owner cannot verify whether he is dead or alive.

Theorectically, with no evidence, when will the land owner finally regain his control over the land, if ever?

If there is no one maintaining the property you can apply to Court for the cancelling of the usufruct as a breach. If there is no one in residence but someone is maintaining the property, a Court Order for information regarding the person's whereabouts may be obtained, if it is not voluntarily forthcoming.

[Sunbelt Asia]

just curious

I've only heard of people using usufructs with their spouse. is it possible to do this with other parties?

if so, and usufruct is as watertight as Sunbelt says, why would anyone go down the leasehold route?

thanks

Nothing is ever watertight. But you can put the odds on your side to withstand being kicked out of a residence. Advantages and disadvantages to any type of lease or a servitude. The biggest disadvantage is a number of land depts. do not have lots of experience with servitudes. It takes many hours and even days for the officers to investigate a foreigner is allowed to register the usufruct, right of habitation or superficies.

Any party is allowed to register with another party. However a clear benefit must be shown and tax paid on that amount.

www.sunbeltasiagroup.com

[tom yum goong]

Nothing is ever watertight. But you can put the odds on your side to withstand being kicked out of a residence. Advantages and disadvantages to any type of lease or a servitude. The biggest disadvantage is a number of land depts. do not have lots of experience with servitudes. It takes many hours and even days for the officers to investigate a foreigner is allowed to register the usufruct, right of habitation or superficies.

Any party is allowed to register with another party. However a clear benefit must be shown and tax paid on that amount.

www.sunbeltasiagroup.com

thanks, thats made it a bit clearer

[bisop]

On some other websites I've read that it's only valid for 30 years. Is there a risk of it becoming invalid after 30 years? Does it have to be renewed and can the owner of the land contest the renewal?

http://www.escapeartist.com/OREQ22/Real_Es...n_Thailand.html

Usufruct interest: This type of agreement grants you temporary ownership rights on the property. In practice, a usufruct is limited to a 30-year maximum period, but can be successively renewed. The usufruct can be sold or transferred, but it expires upon the death of the holder, so cannot be inherited.

http://www.thailandlaw.com/bizforeign.html

Usufruct Interest called in Thai that "Sidthi-kep-kin" , this right gives you temporary ownership rights to things on or arising from the land. In practice, a usufruct is limited to a 30 year maximum period; like leases, the agreement can be successively renewed. In contrast to a lease, a usufructury interest can be sold or transferred, although it expires upon the death of the holder of the usufruct and therefore cannot be inherited

http://www.chiangmai-mail.com/085/business.shtml

Another method is Usufruct Interest (sidhi-kep-kin) that gives you temporary ownership rights to things on the Thai land. In practice, a Usufruct is limited to a 30-year maximum period; like leases, the agreement can be successively renewed.

[Sunbelt Asia]

On some other websites I've read that it's only valid for 30 years. Is there a risk of it becoming invalid after 30 years? Does it have to be renewed and can the owner of the land contest the renewal?

http://www.escapeartist.com/OREQ22/Real_Es...n_Thailand.html

Usufruct interest: This type of agreement grants you temporary ownership rights on the property. In practice, a usufruct is limited to a 30-year maximum period, but can be successively renewed. The usufruct can be sold or transferred, but it expires upon the death of the holder, so cannot be inherited.

http://www.thailandlaw.com/bizforeign.html

Usufruct Interest called in Thai that "Sidthi-kep-kin" , this right gives you temporary ownership rights to things on or arising from the land. In practice, a usufruct is limited to a 30 year maximum period; like leases, the agreement can be successively renewed. In contrast to a lease, a usufructury interest can be sold or transferred,although it expires upon the death of the holder of the usufruct and therefore cannot be inheritedhttp://www.chiangmai-mail.com/085/business.shtml

Another method is Usufruct Interest (sidhi-kep-kin) that gives you temporary ownership rights to things on the Thai land. In practice, a Usufruct is limited to a 30-year maximum period; like leases, the agreement can be successively renewed.

It is common to get misinformation in Thailand either by the phone, in person or by the Internet.

The Civil and Commercial Code

Section 1418

A usufruct may be created either for a period of time or for the life of the usufructary.

If no time has been fixed, it is presumed that the usufruct is for the life of the usfructuary.

Supreme court judgment 2297/1998; 'the lessor does not have to be the owner of the property. Therefore the usefructuary can rent out the land. Although in the event of death of the usefructuary within the lease term, only the usufruct will be terminated but not also the lease'.

www.sunbeltasiagroup.com

[bisop]

Thanks alot

[bisop]

Do you know if I can use this in Phuket? Also, can Sunbeltasia set one up in Phuket from Bangkok or do I need to get a local lawyer to deal with it?

Alex

[Dragonman]

On some other websites I've read that it's only valid for 30 years. Is there a risk of it becoming invalid after 30 years? Does it have to be renewed and can the owner of the land contest the renewal?

http://www.escapeartist.com/OREQ22/Real_Es...n_Thailand.html

Usufruct interest: This type of agreement grants you temporary ownership rights on the property. In practice, a usufruct is limited to a 30-year maximum period, but can be successively renewed. The usufruct can be sold or transferred, but it expires upon the death of the holder, so cannot be inherited.

http://www.thailandlaw.com/bizforeign.html

Usufruct Interest called in Thai that "Sidthi-kep-kin" , this right gives you temporary ownership rights to things on or arising from the land. In practice, a usufruct is limited to a 30 year maximum period; like leases, the agreement can be successively renewed. In contrast to a lease, a usufructury interest can be sold or transferred,although it expires upon the death of the holder of the usufruct and therefore cannot be inheritedhttp://www.chiangmai-mail.com/085/business.shtml

Another method is Usufruct Interest (sidhi-kep-kin) that gives you temporary ownership rights to things on the Thai land. In practice, a Usufruct is limited to a 30-year maximum period; like leases, the agreement can be successively renewed.

It is common to get misinformation in Thailand either by the phone, in person or by the Internet.

The Civil and Commercial Code

Section 1418

A usufruct may be created either for a period of time or for the life of the usufructary.

If no time has been fixed, it is presumed that the usufruct is for the life of the usfructuary.

Supreme court judgment 2297/1998; 'the lessor does not have to be the owner of the property. Therefore the usefructuary can rent out the land. Although in the event of death of the usefructuary within the lease term, only the usufruct will be terminated but not also the lease'.

www.sunbeltasiagroup.com

This is not to say of course that a Court decision cannot reduce the lifetime usufruct to 30 years. This is not an arbitrary term, nor is it derived from the length of maximum leaseholds, but is documented in french and hence canadian Civil Law. An extremely complicated matter that extends outside the Civil & Commercial Code.

Sunbelt, perhaps you, or one of the other sponsors, could sponsor a usufruct for me on my wife's property and then go to Supreme Court for a decision. It will clear up all misunderstandings, and lead to the "way to go" for all foreigners. Also good publicity if you succeed.

[Sunbelt Asia]

This is not to say of course that a Court decision cannot reduce the lifetime usufruct to 30 years

Sure anything is possible; you can even have a coup in Thailand.

But until it is ruled, then foreigners have the same rights as Thais with lifetime usufructs. It's the Thai law until stated different.

Sunbelt, perhaps you, or one of the other sponsors, could sponsor a usufruct for me on my wife's property and then go to Supreme Court for a decision. It will clear up all misunderstandings, and lead to the "way to go" for all foreigners

Sure, but your wife won’t be too happy when you win. ( If she didn't want to register the usufruct in the first place but did it so you could prove a point.)

Do you know if I can use this in Phuket? Also, can Sunbeltasia set one up in Phuket from Bangkok or do I need to get a local lawyer to deal with it?

We can help you register a usufruct in Phuket. Our # is 02-642-0213 [email protected]

www.sunbeltasiagroup.com

[ivr]

Can a Usufruct be registered if the property in question has a mortgage on it?

[Sunbelt Asia]

Can a Usufruct be registered if the property in question has a mortgage on it?

Only if the mortgage holder would allow the usufruct. Not much chance of that, because the value will be less with someone not being allowed to be kicked off the land.

www.sunbeltasiagroup.com

[Dragonman]

.

But until it is ruled, then foreigners have the same rights as Thais with lifetime usufructs. It's the Thai law until stated different.

Sunbelt, perhaps you, or one of the other sponsors, could sponsor a usufruct for me on my wife's property and then go to Supreme Court for a decision. It will clear up all misunderstandings, and lead to the "way to go" for all foreigners

Sure, but your wife won’t be too happy when you win. ( If she didn't want to register the usufruct in the first place but did it so you could prove a point.)

www.sunbeltasiagroup.com

Since there ain't no Constitution at the moment , us farangs can be treated any way they want with impunity.

No, my usufruct would only be the right to sell the the mango and papaya in her (our ) garden.