© MyGSL
The Conveyancing Transaction: Post-Completion Stage
Introduction:
In a previous note, we discussed the completion stage of a conveyancing transaction and emphasised that it is at that stage that the interest is transferred from the vendor to the purchaser. In this note, we will discuss the post-completion, which consists of securing the property and proving, stamping and registering the conveyance instrument. We will discuss each of these processes.
Post Completion Activity 1: Securing the Property:
A. What to Do:
This often involves going into occupation after the transfer of the interest. Among others, it includes the following:
B. Essence:
1. Constructive Notice to Subsequent Purchasers:
Stamping and registering may take time. While a purchaser to whom a conveyance has been made waits to have his conveyance instrument stamped and registered, the vendor may quickly prepare another conveyance for another person who would quickly have that instrument registered. Under the law of equity, the courts can hold that the unregistered instrument will take priority over the registered instrument because the holder of the registered interest had notice of a subsisting interest in the land.
Going into occupation gives notice to subsequent purchasers that there is a subsisting interest in the land (other than that of the vendor, if any).
When the purchaser goes into occupation, a subsequent purchaser of the same land will be held to have constructive notice of the earlier interest. In the case of Espin v. Pemberton (1859) 3 De G. & J. 547 at 554, the court explained constructive notice as
…the knowledge which the Courts impute to a person upon a presumption so strong of the existence of the knowledge, that it cannot be allowed to be rebutted, either from his knowing something which ought to have put him upon further inquiry, or from his wilfully abstaining from inquiry, to avoid notice.
This notice prevents the subsequent purchaser from being a bona fide purchaser for value without notice, as seen in the case of Amuzu v. Oklikah [1997-98] GLR 89-143. In that case, the defendant paid the purchase price and went into occupation. Subsequently, the vendor sold the land to the plaintiff, who proceeded to stamp and register his conveyance with the land registry. The plaintiff then instituted an action against the defendant for trespass and declaration of title to the land. There was an issue of whether or not the plaintiff’s registered interest took precedence over the defendant’s earlier interest (if any). Their lordships of the Supreme Court held that the interest of the defendant took precedence over that of the plaintiff. In the opinion of their lordships,
it is necessary for this court to emphasize that a later instrument can only obtain priority over an earlier one by registration as required by section 24(1) of act 122 if it was obtained without fraud and without notice of the earlier unregistered instrument. Where a party has actual notice that the property was in some way encumbered, he would be held to have constructive notice of all that he would have discovered. In the instant case, since the plaintiff admitted that prior to the sale of the property to him he was aware that the house was being occupied by persons other than the vendor, he was in duty bound to investigate fully the title of the vendor. Failing such investigation before purchase the property, he must be deemed in equity to have had notice of all that a reasonably prudent purchaser would have discovered. The plaintiff cannot be said to be an innocent purchaser for value without notice. The property was encumbered by the contract for sale, and as that contract had not been terminated, the property could not be deemed to be legally or properly back to tender.
Summarily, prior to stamping and registering a conveyance instrument, the purchaser to whom the interest was transferred must go into occupation as a way of giving constructive notice to subsequent purchasers. Without this, a subsequent purchaser who acquires an interest in the same piece of land and proceeds to register his interest may obtain a declaration of title in his favour because he will be a bona fide purchaser for value without any notice that the land belongs to another.
2. Possession as a Source of Good Title:
The acts of building on the land, planting a tree, etc., are acts of possession. In the case of Brown vs. Quarshigah [2003-2004] SCGLR 930, Professor Kludze, JSC, observed that
It cannot be said that the trial Judge was wrong in accepting these acts of presence as evidence of possession. Possession after all means occupation and control in a manner commensurate with the nature of the property. It includes the right or power to exclude others from the property, and also includes the enjoyment of the land…. Possession is a matter of law but is established by physical acts…
In the case of Aryee v. Shell Ghana Ltd and Another [2015] GHASC 102 (22 October 2015), the Supreme Court again stated that
Possession in law is one of the most difficult and complex areas of the law, hence the impossibility in placing it in a pigeon hole. It is normally determinable from the facts of a given case. We are concerned with possession of land in a city like Accra. We cannot lose sight of the numerous problems associated with land ownership in Accra. People who have gone through the process of acquiring land genuinely stand the risk of losing it if they fail to develop it immediately because of multiple sales or leases by the same vendor or lessor as the case may be… people have resorted to erecting temporary structures on the land to serve as visible sign to everybody who goes there to know that at least somebody is on the land. Needless to say squatters also take advantage to settle on unoccupied lands with kiosks and all sorts of temporary structures.
Summarily, putting up structures on the land or building a wall around it is a way of demonstrating possession. The essence of such a demonstration is that the person in possession can use such possession as a source of good title against the whole world except a person with a better title. In the case of Osei (substituted by) Gillard v. Korang [2013–2014] 1 SCGLR, the Supreme Court noted that
Now in law, possession is nine-tenths of the law and a plaintiff in possession has a good title against the whole world except one with a better title. It is the law that possession is prima facie evidence of the right of ownership and it being good against the whole world except the true owner he cannot be ousted of it. See Summey v. Yohuno [1962] 1 GLR 160 SC and Barko v Mustapha [1964] GLR 78 SC
It is, therefore, essential to put up structures on the land while waiting to obtain a legal title through stamping and registration. Among others, it includes producing the originals of all conveyances and receipts.
Post Completion Activity 2: Proof of the Conveyance Instrument:
Before a conveyance instrument is stamped and registered, it must first be proved. In Section 209(1) of The Land Act, 2020 (Act 1036), it is provided that
An instrument presented for registration shall be proved to have been duly executed by the grantor, by the oath of one of the subscribing witnesses of the grantor.
This is to prevent a situation where the purchaser will forge a conveyance in his favour. One of the witnesses of the grantor must, therefore, take an oath by which he deposes to the fact that he saw the grantor execute the conveyance instrument. The oath taken by the witness is known as the oath of proof.
In Section 209(2) of Act 1036, it is provided that the oath shall be on the instrument and shall state that the grantor could read and write. If he cannot, the oath shall state that the instrument was read and interpreted to the grantor in a language he understands and that the grantor appeared to have understood the contents of that instrument.
In Subsection 3 of Act 1036, it is provided that the form of the oath shall be as specified in Form 1 of the Fourth Schedule. In said Form 1, the following precedent is provided:
I, ........................................(full name and address of deponent) make oath and say that on the .......................day of ................... (month), ................ (year), I saw ...............................(full name and address of grantor), duly execute the instrument now produced to me and marked A, and that the said................................... (full name of grantor) can read and write (or, cannot read and write and that the said instrument was read over and interpreted to (name of grantor) by ............................ at the time of its execution and that....................................... (full name of grantor) appeared to understand its provisions).
Sworn at ................................................... this..................................... day of .............................. (month), ............................... (year) ...................................................................
Signed by (deponent)
(Full Name, Address, Signature)
Before me
(Signature of person administering oath)
Per Section 210 of Act 1036, the following are persons before whom proof shall be made:
If the Instrument was executed in Ghana:
If the Instrument was executed in a Commonwealth Country:
If the Instrument was executed in Any Other Country:
Post Completion Activity 3: Stamping the Conveyance Instrument:
A. Requirement of Stamping Before Registration:
In Section 207(2)(d) of Act 1036, it is provided that
(2) An instrument shall not be registered if that instrument
(d) has not been duly stamped in accordance with any enactment which requires stamping of the instrument;
It is essential to note that a conveyance instrument is one of the instruments required to be stamped under the Stamp Duty Act, 2005 (Act 689). In Section 14 of Act 689, it is provided that
An instrument or title shall not be registered or entered in the registry of instruments that affect land or in the land title register unless
- the instrument or document containing particulars of title is stamped; or
- the instrument or document is stamped under section 10 with a particular stamp denoting that it is not chargeable with duty.
The collective effect of Sections 165 and 207(2)(d) of Act 1036, and Section 14 of Act 689 is that an instrument must be stamped before it can be registered.
B. Time for Stamping—Two Months
Section 12(1) of Act 689 provides the time period for stamping. It reads:
Except where express provision is made to the contrary by this Act, an unstamped or insufficiently stamped instrument may after its execution and on payment of the unpaid duty, be stamped with an impressed stamp at any time within two months.
After the execution of the conveyance (at the completion stage), it is crucial to ensure that the conveyance instrument is registered within two months. After the expiration of this period, Subsection 2 provides that it shall not be stamped until there is a payment of a penalty. It reads:
An instrument shall not be stamped after the time limit specified in subsection (1) except on payment of the unpaid duty in addition to a penalty of a value equivalent to two and a half penalty units.
C. Requirement of Payment of Stamp Duty
Before the conveyance duty is stamped, the purchaser must pay a stamp duty. See the Stamp Duty (Amendment) Act, 2023 (Act 1109), for the amounts payable as stamp duty.
D. Effect of Failure to Stamp:
In addition to the position that an unstamped instrument will not be accepted for registration, an unstamped instrument will not be admissible into evidence.
In the case of Lizori Limited v Boye & School of Domestic Catering (2003-2004) SCGLR 903, an unstamped receipt was presented to the trial court by the defendants. The trial judge directed that the defendants go and stamp the documents before they would be formally admitted. The defendants failed or refused to do so.
The Supreme Court was of the view that when a party refuses to comply with a legitimate directive or instruction of a court to pay stamp duty, that court would be justified in rejecting the party’s request to admit those documents in evidence. Their lordships relied on Section 32 of Act 689, particularly subsection 6(b), which reads:
6) Except as expressly provided in this section, an instrument
(a) executed in Ghana; or
(b) executed outside Ghana but relating to property situate or to any matter or thing done or to be done in Ghana; shall, except in criminal proceedings, not be given in evidence or be available for any purpose unless it is stamped in accordance with the law in force at the time when it was first executed. (emphasis supplied)
They concluded:
This provision is so clear and unambiguous and requires no interpretation. Either the document has been stamped and appropriate duty paid in accordance with the law in force at the time it was executed or it should not be admitted in evidence. There is no discretion to admit it in the first place and ask the party to pay the duty and penalty after judgment. Thus the trial court would have been perfectly justified to reject the receipts without stamping.
Summarily, an unstamped instrument will not be admitted into evidence.
Post Completion Activity 4: Registration of The Conveyance Instrument (Deed Registration):
In Ghana, there are two systems of registration:
Under Act 1036, title registration is provided for in Chapter 5 and deed registration is provided for in Chapter 6.
The discussion that follows is on deed registration, which is the registration of the conveyance instrument. Such registration is done if the land is situated in a non-registration district.
A. A Conveyance as a Registrable Instrument:
In Section 207(1)(a) of Act 1036, it is provided that
An instrument affecting land including a conveyance, may be registered under this Act.
B. Pre-Requisites for Registration of Conveyance Instrument:
In Section 207(2) of Act 1036, it is provided that
(2) An instrument shall not be registered if that instrument
- does not have sufficient description of the land to enable the Land Registrar to identify the location and boundaries of the land to which the instrument relate;
- does not have a sufficient reference to the date and particulars of registration of an instrument affecting the same land and already registered;
- does not have attached to the instrument an approved plan, unless the instrument makes reference to an approved plan attached to an instrument that is already registered at the Registry;
- has not been duly stamped in accordance with any enactment which requires stamping of the instrument;
- does not have attached to the instrument, consents and statutory approvals required for the transaction evidenced in the instrument; and
- does not conform to the requirements of this Act.
In addition to the above, the following must be done before the conveyance instrument is registered:
Once these requirements are fulfilled, the conveyance instrument is presented to the Lands Commission for registration, particularly its Land Registration Division. It will be remembered that under Section 21 of the Lands Commission Act, 2008 (Act 767), it is provided that “The functions of the Land Registration Division include registration of deeds and other instruments affecting land in areas outside compulsory title registration districts.”
When the instrument is presented for registration, Section 212 of Act 1036 provides that the Land Registrar shall issue an acknowledgement of receipt to the applicant showing the date and time of the receipt of the instrument. The Registrar shall also publish notice of an application for first registration in a daily newspaper of national circulation.
C. Registration of Instruments in Register Kept by the Land Registrar and Certificate of Registration:
In Section 214(1) of Act 1036, it is provided that
The Land Registrar shall keep a register and, subject to the exceptions stated in this Act, register instruments presented in that register.
In Section 216(1), it is also provided that
The Land Registrar shall immediately after the proof of an instrument presented, or on the presentation of an instrument duly proved before any other person for registration, or of an instrument which may be registered under this Act without proof, place on the instrument a certificate as set out in Form 3 in the Fourth Schedule
Below is said certificate:
CERTIFICATE OF REGISTRATION OF INSTRUMENT
This Instrument is registered under section 216 of the Land Act, 2020 (Act........................), this..............day of .................... (month), ................(year) at ................. o'clock in the noon (Signed and sealed by the Land Registrar)
D. When a Land Registrar will Refuse to Register an Instrument:
In Section 223 of Act 1036, it is provided that
A Land Registrar may, subject to sections 224, 225 and 226, refuse to register an instrument affecting a particular land if
- the Registrar is satisfied that the instrument deals with the land or part of the land in a manner inconsistent with an instrument previously executed, whether by the same grantor or a predecessor-in-title or by any other person;
- on the face of the records, the grantor does not appear to be entitled to deal with the land as the instrument purports to do;
- the instrument is made in contravention of, or is void by virtue of an enactment; or
- the instrument contains an interlineation, a blank, an erasure or alteration not verified by the signatures or initials of the person executing the instrument.
For instance, under Section 223(c), a Land Registrar can refuse to register the instrument if it is not stamped or proved.
E. Effect of Registration of Conveyance Instrument:
The following are the effects of registration of an instrument:
Conclusion:
This note discusses various post-completion activities that must be undertaken by the purchaser of land. It must be pointed out that the discussion on the registration of the conveyance instrument is limited to areas that have not been declared as a registration districts. In a subsequent note, we will examine the registration of title in an area that is designated as a registered district.