REVIEW OF THE SECTIONAL PROPERTIES ACT, 2019
Mwaniki Gachoka
Court of Appeal Judge in the Kenyan Judiciary / Former Partner at MG Law Advocates / Founder of MG Law Advocates / Former EACC Commissioner / Chartered Arbitrator / Accredited Mediator / Passionate Golfer & Hiker"
On the eve of Jamhuri day as the country prepared to celebrate the 57th birthday of the Republic, H.E The President assented into law the Sectional Properties Bill, 2019 (hereinafter referred to as ‘the Act’). This piece of legislation is a milestone on the emerging property market needs to property owners, investors and financial institutions.
The centrifugal force of the Act is that it repeals the Sectional Properties Act, 1987 which has been criticized for being unresponsive to market needs. In so doing, it heralds ownership by issuance of certificate of leases to units in a building while the common areas be owned by proprietors of the units as tenants in common. The Act provides for review of all long term leases registered before commencement of the Act to be in conformity with Section 54 of the Land Registration Act on issuance of certificate of leases over apartments, flats, maisonettes, townhouses or offices. The review is to be implemented within 2 years after commencement of the Act. The vesting of absolute rights on unit owners safeguards them from fraudulent and mischievous head leasors who hold onto the head lease even after sale of the units under sub-leases. Similarly, on conversion of the long term sub-lease, the reversionary interest shall vest on individual owners through their respective corporations established in accordance with the Act.
Importantly, the Act applies to freehold/leasehold title where the unexpired residue of the term is not less than 21 years, this represents a departure from the previous 45 years. In so doing, it strikes harmony with the law on leases as provided under Section 30 (2)(b) of the Land Registration Act, 2012.
On dispute resolution, the Act introduces a committee for the same under Section 20 as read with Section 30 with an Appeal mechanism reserved for the Court.
Finally, on termination, the sectional status of a building may be terminated by unanimous resolution, on account of substantial or total damage to the building or compulsory acquisition. Previously, termination was by order of the Court.
This is a welcome law tightening control measures and providing a semblance of much needed sanity.
These are just a few highlights and further information can be sought through the firm of Mwaniki Gachoka & Co Advocates.