Understanding the Concept of Land
Land is defined as the solid surface of the earth, including trees, plants, crops, and other vegetation. It also encompasses parts of the earth’s surface covered by water, any house, building, or structure, and any interest or rights in, to, or over immovable property. According to Section 281 of the Land Act, 2020 (Act 1036), things on the soil surface are considered part of the land, along with the space above and the soil beneath. This includes rivers, streams, growing trees like palm trees, artificial structures such as buildings, and mineral resources.
Additionally, land includes estates, interests, or rights in the land or over any of the things that land denotes. For instance, it may involve rights to collect herbs, snails, or hunt on the land. As noted by Justice N.A Ollenu in “Principles of Customary Land Law in Ghana (PCLLG),” whoever owns the soil owns everything up to the heavens and down to the depth of the earth. A landowner’s rights extend upwards into the airspace and downwards into the earth.
What is Due Diligence?
Legal due diligence is a process involving the collection, understanding, and assessment of all risks associated with the acquisition of property, such as land. It is typically undertaken by parties involved in significant commercial transactions to identify potential legal risks that may arise from the acquisition process.
This process involves reviewing key documents and conducting interviews with relevant individuals. In property or land transactions, it is usually carried out by lawyers for the purchaser. These formal inquiries are made to regulatory bodies to verify the authenticity of a land title and its associated documents.
The Importance of Due Diligence
Due diligence is crucial for anyone interested in acquiring property, especially land in Ghana. It helps avoid various risks that prospective buyers often fall victim to, such as cost, multiple sales of land, fraud, corruption, weaknesses in the land administration system, challenges with customary land ownership, lack of transparency, bureaucracy, and delays.
Other reasons why due diligence is important include understanding the legal compliance system involved and appreciating the necessary documents required to complete the process. Conducting due diligence also helps parties anticipate future problems with the transaction and implement necessary systems to address them. This allows legal counsel to reach consistent conclusions and provide the right legal opinion on the transaction and the appropriate payment amount.
Steps to Undertake Due Diligence Before Acquiring Land in Ghana
Customary Land Secretariat (CLC) Search – Three Key Actions
- Ensure that you are dealing with the right land owner
- For Stool Lands, deal with the stool occupants and his principal elders of the stool.
- For Family Lands, deal with the Family Heads and Principal Members of the family.
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For Individual Lands, deal with the actual owner.
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Always obtain a receipt for all payments/transactions made by the land owner
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Ensure the right documentation for the land is provided by the land owner
- Four copies of the document developed between the chief and the applicant must be submitted to the Lands Commission.
- A lawyer must sign the back of each copy and put his stamp on it.
- Each copy of the document must have a site plan attached.
- The back of the site plans is to be endorsed by both the Chief and the Applicant or buyer.
- Each site plan is to be certified with stamps of a licensed Surveyor and the Regional Surveyor and must have a date.
- At least two Principal Elders of the Stool (with stated status) must sign as witnesses.
- The witnesses of the applicant/buyer must write the full name, provide addresses and signatures.
Review of Land Documents
It is essential to review and examine the various land or property titles to the land or property documents provided, such as the original lease agreement. Verify that past and future promises concerning the ownership of the land (called covenants) have been met. This is critical since it provides proof of the validity of the title that passes to you.
Land Use and Spatial Planning Authority Search
This search confirms the zoning requirements for the land or property under consideration. This requirement is very important because the grant of any land that contradicts the zoning mandate makes the grant void. For example, if land is zoned for residential purposes, it cannot be used for other purposes such as commercial purposes regardless of what the grant states.
Lands Commission Searches – Three Key State Divisions to Contact
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Public Vested Lands Management Division (PVMD)
This division provides information on all transactions on the land. It identifies who the proper owner of the land is and whether the present title cannot hold. This search is important to avoid engaging the wrong land owner. -
Survey and Mapping Division Search
This provides information on who is in the process of registering that land and whether a cadastral plan has been prepared. It is useful since it provides information on key interested parties to a particular land or property. -
Land Registration Division
This division provides actual information on who holds the land title and is the most authentic information needed in the process of acquiring land. Title from this division is typically very authentic and devoid of any fraud.
Litigation Search
It is important to ensure the land one seeks to acquire is not subject to any ongoing legal battle. This search is essential since most sellers often do not disclose any pending lawsuits, leaving buyers to their own fate. This search can be conducted in the various courts situated in the jurisdiction the land is located. Court judgement search affecting the land or property. A valid court judgment must be signed by both the court registrar and judge, and specify the interest in land over which the judgment binds. This action can be instituted in the various courts situated where the land is located.
