Property without title

Preliminaries

1. (a)Firstly, the purchaser’s solicitor would obtain all the necessary information in order to prepare the sale and purchase agreement and the deed of assignment. This information would include:
   1. (i)A copy of the purchaser’s identity card;
   2. (ii)A copy of the vendor’s identity card and address;
   3. (iii)All previous documents up until the principal sale and purchase agreement between the vendor and developer;
   4. (iv)The property address;
   5. (v)Details of the vendor’s present financier;
   6. (vi)The details of the master chargee on the master title;
   7. (vii)The developer/proprietors details
2. (b)The purchaser’s solicitor should also conduct a land search on the master title to ensure the land is not encumbered, who the proprietor of the land is, whether the land is freehold or leasehold, and who the master chargee of the said land is.
3. (c)The purchaser’s solicitor should also conduct a bankruptcy search on the vendor or if the vendor is a company, a winding up search on the same. If the vendor is discovered to be a bankrupt or if the vendor’s company is found to be wound up, the vendor does not have the right to sell the property without the permission of the official assignee or the liquidators, and therefore the sale transaction should be terminated.
4. (d)The purchaser’s solicitor should only proceed to draft the sale and purchase agreement and the draft deed of assignment after obtaining the search results and the relevant documents.
5. (e)Once the draft sale and purchase agreement and the deed of assignment have been prepared they should be forwarded to the vendor’s solicitor for his perusal and amendment (if any).
6. (f)Once the terms and conditions of the draft sale and purchase agreement and deed of assignment have been agreed, the purchaser’s solicitor should then finalise the documents.
7. (g)The agreements and documents the purchaser’s solicitor needs to prepare for the purchaser to execute, are as follows:
   1. (i)Four copies of the approved sale and purchase agreement;
   2. (ii)Four copies of the approved deed of assignment;
   3. (iii)The CKHT 2A form
   4. (iv)Five copies of the PDS 15 form;
   5. (v)The vendor’s statutory declaration that he is not a bankrupt or if the vendor is a company, the vendor’s directors’ statutory declaration that they are not bankrupts and the company is not subject to winding up proceedings;
   6. (vi)The relevant part of the state authority consent application form with its statutory declaration (if applicable); and
   7. (vii)The bill for the purchaser’s solicitor’s legal fees and disbursements
8. (h)After these documents have been prepared, the purchaser’s solicitor shall arrange for the purchaser to execute them and to pay the deposit sum in favour of the vendor or the vendor’s solicitor, and the purchaser’s solicitor’s legal fees and disbursements.
9. (i)At the time of filing the tax return forms [CKHT2A], the purchaser must pay 2% of the purchase price, on behalf of the vendor. The balance 3% will be paid by the vendor upon receipt of the tax form (Notis Taksiran).

It should be noted that the 2% paid by the purchaser forms part of the purchase price.

Procedure for the execution of documents

1. (a) Following execution of the documents, and the payments being made, the purchaser’s solicitor would attest the signature of the purchaser and forward the documents together with the deposit sum, to the vendor’s solicitor.
2. (b) Once the documents are returned from the vendor’s solicitor with the vendor’s signature duly attested by the vendor’s solicitor, the purchaser‘s solicitor shall then date the sale and purchase agreement and stamp it for RM10 per copy.
3. (c) When the sale and purchase agreement is dated and stamped, the purchaser’s solicitor shall forward a duplicate copy of the sale and purchase agreement to the vendor’s solicitor and the original and a duplicate copy of the same to the purchaser.
4. (d) Within 60 days from the date of the sale and purchase agreement, the purchaser’s solicitor shall forward the CKHT 2A Form to the relevant tax department for the purpose of the real property gains tax, together with a copy of the duly executed and stamped sale and purchase.
5. (e) Thereafter the purchaser’s solicitor has to wait for the developer’s confirmation or consent (if applicable) and state authority consent (if applicable) from the vendor’s solicitors.
6. (f) In some instances, although the master title is yet to be subdivided, the state authority’s consent is also required to be obtained by the vendor.
7. (g) As mentioned above, for properties that fall outside the jurisdiction of the Housing Developer (Control & Licensing) Act 1966 i.e. non-residential properties, the vendor’s solicitor must request from the developer/proprietor for their consent to sell and assign the said property to the purchaser
8. (h) All that is needed for properties within the jurisdiction of the Housing Developer (Control & Licensing) Act 1966 i.e. residential properties is merely a developer’s confirmation (not consent) for the assignment or sale of the property to the purchaser. This is merely a formality in which the developer can charge a fee not more than RM50 (as an administration fee) for each confirmation.

Procedure upon obtaining developer’s consent (where applicable)

1. (a) When the purchaser’s solicitor has received the consent from the vendor’s solicitors (for properties that fall outside the jurisdiction of the Housing Developer (Control & Licensing) Act 1966), the completion date for the sale and purchase transaction can be computed.
2. (b) The purchaser’s solicitor shall verify if there is any part of the developer’s consent that needs to be fulfilled by the purchaser.
3. (c) After the confirmation by the purchaser’s solicitor and the vendor’s solicitor that the terms and conditions of the developer’s consent has been complied with by both parties, the purchaser’s solicitor (if applicable) may send the deed of assignment to the developer for endorsement and return. However some developers only execute the deed of assignment, if the deed of receipt and reassignment is also received by them.
4. (d) In the meantime, the purchaser’s solicitor should ensure that the purchaser has applied for his loan financing. The purchaser and the vendor’s solicitor must comply with the purchaser’s financier’s terms and conditions for the loan transaction, on or before the first month of the completion date in order to complete the sale and purchase transaction on time.
5. (e) The purchaser’s solicitor is unable to proceed any further at this stage until he receives the purchaser’s financier’s solicitor’s letter requesting confirmations and undertakings as required by the purchaser’s financier, in order to release the loan sum for the sale transaction.
6. (f) Upon receipt of this letter, the purchaser’s solicitor shall proceed to comply with its request and requirements.
7. (g) The purchaser’s solicitor should then write to the vendor’s solicitor requesting the redemption sum, and undertakings in favour of the purchaser’s financier, if the purchaser’s financier’s solicitor’s has not already done so.
8. (h) If the purchaser’s financier’s solicitor has only directed his letter to the purchaser’s solicitor then it is the obligation of the purchaser’s solicitor to immediately write to the vendor’s solicitor to obtain the redemption statement and undertaking in favour of the purchaser’s financier, or inform the purchaser’s financier’s solicitors to obtain the same directly from the vendor’s solicitor.

Procedure upon receipt of the redemption statement

1. (a) Upon receipt of the redemption statement cum undertaking from the vendor’s solicitor, the purchaser’s solicitor shall immediately forward it to the purchaser’s financier’s solicitor.
2. (b) The purchaser’s solicitor should also ensure at that point in time that the purchaser pays the differential sum to the vendor’s solicitor.
3. (c)Upon payment of the differential sum to the vendor’s solicitor, the purchaser’s solicitor shall request a written confirmation of receipt from the vendor’s solicitor, which is then given to the purchaser’s financier’s solicitor.
4. (d) Upon receiving confirmation from the purchaser’s financier’s solicitor that the redemption sum has been released to the vendor’s solicitor, and thereafter to the vendor’s financier to redeem the property, the purchaser’s solicitor shall then await the written confirmation from the vendor’s solicitor of the date of the deed of receipt and reassignment.
5. (e) Upon written confirmation of the date of the deed of receipt and reassignment, the deed of assignment must be dated and endorsed by the developer/proprietor (where applicable). Only then can the purchaser’s solicitor submit the deed of assignment for adjudication at the stamp office.
6. (f) Upon the deed of assignment being dated and sent for adjudication, the purchaser’s solicitor would then confirm the same with the purchaser’s financier’s solicitor so that they are able to date the deed of assignment between the purchaser and the financier and proceed to stamp it.
7. (g) After that the purchaser’s financier’s solicitor shall advise for the release of the balance loan sum.
8. (h) The purchaser’s solicitor should forward an undertaking to the purchaser’s financier’s solicitor to forward the original deed of assignment, duly executed and stamped, upon receipt.
9. (i) After all the above has been completed, the purchaser’s solicitor should be receiving the balance loan sum from the purchaser’s financier’s solicitor within a week thereof, and thereafter the same shall be forwarded to the vendor’s solicitor, as stakeholder, together with the pro-rated or apportioned outgoings in exchange for the vacant possession of the vendor’s property, usually by handing over the keys of the property.
10. (j) Within one to one and a half months into the completion date, the purchaser’s solicitor should receive the adjudicated stamp duty (Notis Taksiran) informing of the amount of the stamp duty that needs to be paid on the deed of assignment.
11. (k) It is to be noted that the deed of assignment must be stamped with full duty paid within thirty days from the date of the assessment notice (Notis Taksiran), failing which a penalty on the sum payable shall be imposed on the purchaser.
12. (l) Upon the original and duplicate copy of the deed of assignment being stamped, the original deed of assignment should be forwarded to the purchaser’s financier or its solicitor, and a duplicate copy forwarded to the vendor’s solicitor, and the purchaser, respectively. A stamped copy of the deed of assignment must be forwarded to the developer to update their records.
13. (m) Lastly, a purchaser’s solicitor must keep the matter in abeyance until the individual document of title has issued, or the strata title (whichever applicable). The purchaser’s solicitor should then prepare and perfect the memorandum of transfer (form 14A) to transfer the property from the developer/proprietor to the purchaser.
14. (n) The purchaser’s solicitor is also to liaise with the vendor’s solicitor to ensure the real property gains tax has been paid by the vendor or the vendor’s solicitor to protect the interest of the purchaser’s property.

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