Always Document Land Transactions – Court
By Dickson Jere
Two friends. One worked for National Housing Authority (NHA). The other one wanted to buy a house from NHA and decided to use his friend to buy it for him since he was an employee and therefore easy to get the offer. He provided the funds and the house was bought but under his friend’s name. The house was then put on rent and the rentals were remitted to a company owned by the friend.
After a while, his friend decided to sell the house since it was in his name. He did not consult the owner and the transaction went smooth. However, the purported owner of the house discovered the sale. He was livid!
He sued in the High Court and claimed ownership of the property saying his friend was merely holding the property in “trust” for him as he paid for it. The Judge heard the case and ruled that indeed he was the owner and his friend was holding onto the property in trust. The sale was, consequently, canceled and the house given back to the ‘owner’.
Unhappy, the friend appealed.
The Court of Appeal Judges heard the case and reversed the High Court decision. They opined that the friend did not provide documents to show that he actually paid for the house through his friend. The receipts were all in the name of the NHA employee and the two did not sign any documents.
Dissatisfied, the other friend appealed to the Supreme Court, arguing that he paid for the money and the friend was merely holding the property in trust. Witnesses actually testified in his favor but without any documentary evidence.
Three Judges of the Supreme Court determined the case thus;
“A case may either be proved orally or through documentary evidence or both,” the Judges said.
However, some cases such as present one required that the oral evidence must be backed by documents as it was a requirement under the Statute of Frauds that land transactions must be witnessed in writing.
“The appellant did not adduce evidence that he paid for the property with his own money giving rise to the creation of a resulting trust in his favor,” the Court ruled.
“A trust of personality can be created without writing whereas a trust of land requires to be in writing,” the Court ruled and dismissed the appeal.
“In the present appeal, the issue involves land. It cannot, therefore, be argued by the appellant that there was no need to execute an instrument to create a resulting trust,” the Court concluded.
Always document land transactions!
Case citation – Kunkuta v Chibangula & Another – Appeal No. 8/2019.
Lecture Notes;
- Take note that the Statute of Frauds Act of 1677 is applicable in Zambia and requires that all land transactions must be witnessed in writing. No verbal agreements when dealing with land. Make sure you always consult a lawyer when transacting in land.
- In this case, the Court agreed that the witnesses testified as to who was the owner of the house but non presented any documents to buttress that position. If documents showed that he gave money to his friend to buy him the house, the Court would have ruled that there as a “resulting trust” and owner would have taken the house
Two friends. One worked for National Housing Authority (NHA). The other one wanted to buy a house from NHA and decided to use his friend to buy it for him since he was an employee and therefore easy to get the offer. He provided the funds and the house was bought but under his friend’s name. The house was then put on rent and the rentals were remitted to a company owned by the friend.
After a while, his friend decided to sell the house since it was in his name. He did not consult the owner and the transaction went smooth. However, the purported owner of the house discovered the sale. He was livid!
He sued in the High Court and claimed ownership of the property saying his friend was merely holding the property in “trust” for him as he paid for it. The Judge heard the case and ruled that indeed he was the owner and his friend was holding onto the property in trust. The sale was, consequently, canceled and the house given back to the ‘owner’.
Unhappy, the friend appealed.
The Court of Appeal Judges heard the case and reversed the High Court decision. They opined that the friend did not provide documents to show that he actually paid for the house through his friend. The receipts were all in the name of the NHA employee and the two did not sign any documents.
Dissatisfied, the other friend appealed to the Supreme Court, arguing that he paid for the money and the friend was merely holding the property in trust. Witnesses actually testified in his favor but without any documentary evidence.
Three Judges of the Supreme Court determined the case thus;
“A case may either be proved orally or through documentary evidence or both,” the Judges said.
However, some cases such as present one required that the oral evidence must be backed by documents as it was a requirement under the Statute of Frauds that land transactions must be witnessed in writing.
“The appellant did not adduce evidence that he paid for the property with his own money giving rise to the creation of a resulting trust in his favor,” the Court ruled.
“A trust of personality can be created without writing whereas a trust of land requires to be in writing,” the Court ruled and dismissed the appeal.
“In the present appeal, the issue involves land. It cannot, therefore, be argued by the appellant that there was no need to execute an instrument to create a resulting trust,” the Court concluded.
Always document land transactions!
Case citation – Kunkuta v Chibangula & Another – Appeal No. 8/2019.
Lecture Notes;
- Take note that the Statute of Frauds Act of 1677 is applicable in Zambia and requires that all land transactions must be witnessed in writing. No verbal agreements when dealing with land. Make sure you always consult a lawyer when transacting in land.
- In this case, the Court agreed that the witnesses testified as to who was the owner of the house but non presented any documents to buttress that position. If documents showed that he gave money to his friend to buy him the house, the Court would have ruled that there as a “resulting trust” and owner would have taken the house.