By Nomad Advocates
Once condominium titles are created, the parent title becomes inactive and cannot be used in transactions in Uganda
Condominium Property – section 3 (1) of The Condominium Property Act – once a building is divided into several units individually owned, the land on which it is established is collectively owned – upon the registration of a condominium plan, condominium titles are created and the original “parent” or “mother” land title is closed (or revoked) by the Registrar of Titles. It ceases to exist as an active, single title for the entire parcel of land in the same form as before. It is legally dissolved and replaced by the collective ownership structure defined by the condominium plan and the individual unit titles issued under it – It henceforth serves as a reference in the Registry but is no longer an active instrument for transferring the entire property as a single unit – A purchaser of a condominium unit acquires its ownership in fee, meaning they own the individual unit in fee simple but modified by restrictive covenants relating to the specific building – The property may revert to being held as a single parcel under a “reconstituted” parent title, often with the former unit owners as tenants in common, when the building is destroyed, or when the unit owners unanimously agree to terminate the condominium status, often to facilitate a bulk sale to a single investor or developer, or when it becomes impractical or uneconomical to continue the condominium regime – For a contract related to a condominium property to be valid, it must refer to the current, valid Condominium Certificate of Title for a specific unit and its associated common interest – Save in the case of bona fide purchasers, if someone does not own land, they cannot sell it to give valid ownership – bona fide purchase – A person generally has “notice” of a particular fact if that person has knowledge of circumstances which, upon reasonable inquiry, would lead to that
particular fact.
Law of contract – Res extincta – A contract must have a legal and valid object or subject matter. A contract dealing with an asset that is no longer a valid, independent legal entity lacks this essential element. Therefore, a contract whose subject is the original “parent” or “mother” land title, after it has been replaced by condominium titles, is void – Privity – An agreement cannot unilaterally create legal duties or liabilities for a non-consenting third party; it cannot impose direct obligations on a third party without their consent. (Summarry extract from ULII
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