REAL ESATE LAWS AND REFERENCES 2.6

What can be done if I have paid the lot propety in full but no contract to sell can be provided by the developer?

“I purchased lot by 2 years installment without interest  from a developer who promised contract to sell, but I have already paid the lot in full and it’s been more than a year now, but everytime we ask for the contract to sell, they say that the title is not in the developer’s name yet and according to them, the delay is due to the government. I only have receipts of my payment. Can I demand for a transfer of title to my name? ”

 

There are things that you should have done before deciding to buy: You must have made sure there is a contract to sell and that you agreed on the provisions stipulated on the contract to sell. The proper procedure should be, first, you and the developer will sign a reservation agreement which is a contract that stipulates the time that a contract to sell will be provided (usually when the agreed equity such as 20% of the total contract price is paid up). Then, when the equity or your payments have reached this level, a contract to sell shall be demanded from the developer, and when it is fully paid, the deed of absolute sale shall be demanded. 

   I understand that this has been a mistake before, which is just a lesson learned what to do next time. Now, let’s focus on what we can do to minimize the effect of this problem if not completely solved. 

  But before, I proceed, let me just comment about their flimsy excuse that it’s the government that is causing the delay. Obviously, it’s not the government, but it’s their inability to meet the requirements of the government. Some developers do not own the land entirely as some go for joint venture agreement with land owners. In fact, if you were represented by a lawyer, or at least a knowledgeable broker, the mother title can be checked if it’s really in the name of the developer. If the problem lies on the ownership of the land wherein there are still some conditions from real owners who might not been paid yet, then the title could not be transferred to the name of the developer and of course, it could not transferred to you either. I’m positive that in this situation, the developer has a tremendous management or financial problem that it could not get through with their land titling and it’s just unfortunate that like in your case, the buyers suffer the consequences.

   There are things that you can do to minimize the effects of this problem:
1) You can fence the property and lock it up so no one can pass. One proof of ownership is possession of the property. Even those without papers or title but have occupied the property for so many years are granted ownership by the government for we have prescriptive period of continuous occupancy of the land as one of the proof of ownership if the title is not available.
2) If you can build a small house where one can occupy it continuously and report to you if anyone would trespass, the better. 

3) All your follow ups or communications with the developer shall all be in writing and duly received by the officer of the developer whoever is concerned. In your writings, you should indicate that you need a written reply from them. If they say it’s the government that’s causing the delay, let them put that into writing. 

4)If you were promised with a contract to sell at least verbally by anyone of their representatives, make an affidavit to that effect duly notarized by a lawyer here, and if you have a witness like your agent, then let him sign as your witness. This is what you will base your demand for the deed of absolute sale for now together with your receipt of payments. You will no longer press for a contract to sell because contract to sell is only good for those not fully paid (there is still balance to pay) but in your case where it is already fully paid, you should demand for a deed of absolute sale. 

5) To minimize expenses on legal action, i think it is best that you approach the barangay captain where your lot is situated and tell him your story with documented receipts. Then ask the barangay captain to summon the president of the developer together with the any of their representatives of officer who verbally promised you with contract to sell. This is the first step required by our laws, to settle first within the barangay level. You should be there when the hearing with the barangay captain is set. If you can’t make it personally, send an authorized representative and it should be in writing (SPA).  It will be the barangay captain who will press them to provide you the deed of absolute sale as you have fully paid the lot. If they won’t settle or fail to comply what they promised in front of the barangay captain, ask the barangay captain a certificate to file legal action. Then, it will be the time to hire a lawyer to purse the case legally in court. 

Don’t worry, I don’t think that you will lose ownership of the property. No one can run away from your money especially if it is an immovable property. You just have to press for your documented ownership if you want to make it as soon as possible. The immediate problem would be when you use it for collateral with a bank, it cannot be as it has no title yet in your name.