An increasing number of developers and landowners are joining up for joint development agreements as standalone residences and villas make way for skyscrapers. Is there anything to be aware of before signing such a contract?
Get the JDA registered
Any legal document that contains stated terms, conditions, or clauses is only enforceable if it is filed with the sub-registrar's office. This benefits a possible buyer in addition to the developer and landowner. It has often been observed that people choose the easy route and either have JDAs notarized or have them signed on a stamp paper. Proceeding in this manner is incorrect.
Note the Supplementary Development Agreement
The supplemental development agreement must also be registered, in addition to the JDA. There's no reason why this agreement couldn't differ slightly from what the JDA states. If it isn't registered, though, it isn't lawful.
Transferring the rights to family?
The landowner might wish to give a family member ownership rights. Typically, a General Power of Attorney (GPA) is used for this, and in this situation, the landowner can ask the buyer to use the GPA to transfer the funds to the family member in question.
Additionally, as this type of transaction is most likely to welcome benami transactions, which can put the buyer and the landowner in hot water, buyers should take care that they are working with the landowner whose name appears in the JDA. Remember that it is the buyer's responsibility to review the GPA in order to comprehend the inheritance and the manner in which the land has been transferred from one owner to another.
