In Jersey there are several different ways that purchasers
obtain the right to occupy their property and some of them impose
rights and duties upon a purchaser.
Purchasers of an apartment will usually have either purchased by
share transfer or flying freehold.
The purchaser of a share transfer property will have an
exclusive right to occupy a specific apartment by virtue of
ownership of shares in a company. The purchaser will be responsible
for the upkeep of the interior of their specified apartment
together with any other parts which are in their exclusive use such
as balconies or gardens.
The property and the land upon which it sits will be owned by a
property holding company in which the purchaser will hold
The company's Articles of Association will set out the
rights and duties of each shareholder such as to pay service
charges and maintain their own specified part of the property. The
Articles will also contain the company's obligations, which
usually include payment of the buildings insurance and maintenance
of the communal areas (ie lifts and gardens).
The shareholders service charges are paid to the company
secretary or managing agent who will then settle the company's
expenses and deal with the administration. Larger developments will
have a professional secretary or managing agent but a smaller
building may be run by one of the shareholders.
Since 2010 a purchase by way of share transfer is subject to
payment of land transaction tax ("LTT") which equates to
the same amount as stamp duty payable in respect of a freehold
purchase. The completion of a share transfer transaction is by way
of signing of agreements and does not require the purchaser to
attend before the Royal Court; and so the transaction may be
completed on any day of the week. There is at present no public
record of who owns by way of share transfer as each company keeps
its own shareholders' register.
If a purchaser has bought by way of flying freehold then they
will own a "lot" or portion of the property which is
defined in a Declaration document.
The Declaration will contain each co-owners right to occupy
their specified "lot" and will include the rules by which
the co-owner must abide. The Declaration will create an Association
of the co-owners, the head of which is the Representative. The
Representative is the executive officer of the Association and
carries out decisions and obligations on its behalf. In a similar
way to share transfer the upkeep of the building as a whole will be
funded through service charges and the Representative (which again
in larger developments is often a professional managing agent) will
deal with the administration and maintenance of the property as a
The purchaser of a flying freehold is required to pay stamp duty
to the Royal Court upon the passing of their contract of purchase.
The purchaser will either need to attend Royal Court in person or
give a power of attorney for someone else to appear on his
The purchase of a house will take place by the passing of a
contract before the Royal Court and the purchaser will acquire the
freehold buildings, land and rights as set out in their contract of
purchase. The contract may include their rights to have pipes and
other apparatus across or under their neighbours' land as well
as their access rights to come and go from their property. The
contract may also include restrictions as to the use or building on
the land and can contain restrictions as to whom the property may
be sold in the future. In a first time buyer development an onward
sale is frequently restricted to first time buyers.
A right to occupy a property can be given by a lease. In Jersey
there are two types of leases. If the lease is for 9 years or less
then it is known as a "paper lease" and does not need to
be passed before the Royal Court. A lease for more than 9 years is
known as a "contract lease" and needs to be passed by the
Royal on a Friday afternoon. The contract lease is liable to
payment of stamp duty which is calculated in accordance with the
rental income and length of the lease.
All contracts, whether by way of flying freehold, freehold
purchase or contract lease are recorded in the Public Registry and
it is this record which is evidence of ownership of, or right to
occupy, a property and land rather than the possession of
"title deeds" as is the case in the UK.
Whichever way property rights are acquired a purchaser should
always meet with their lawyer or conveyancing manager prior to
completion and ensure they are fully informed as to their rights of
ownership, occupation and any obligations for which they may be
As originally appeared in Homelife, March 2012
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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Back in Issue 05 of IQ, we examined the decision in Yam Seng PTE Ltd v International Trade Corporation Ltd and looked at whether a general obligation of good faith could be implied into contracts made in accordance with English law.
A recent report1 by Global Construction Perspectives and Oxford Economics forecasts that by 2030 the volume of construction output will grow by 85% to US$15.5 trillion worldwide, with China, the US and India leading the way and accounting for 57% of all global growth.
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