THAI LAW - Leased property from a spouse
Thai law | There are a large
number of foreigners who come to settle and live here in Thailand; many spend
large sums of money to buy a house and land under the name of a Thai spouse
with the aim of leasing for themselves for up to thirty years which can be for
the term of their natural lives. This arrangement is usually fine but problems
arise when the partners divorce or become separated and the Thai spouse does
not agree to return the property to the foreign partner. This usually forces
the foreigner to submit a court case against their spouse to declare that the
funds used to purchase the property was brought into the country from abroad by
them for the specific purpose of buying that property. Because they cannot hold
the land under their name they were forced to put it under the spouses name
then leasing it back to them. This is illegal under Thai land and if you
declare this in court then the judge will order an auction of the property and
return the money back to the foreigner.
Occasionally the
judge will try to compromise between the two parties and share the funds
fifty-fifty between the spouse and the foreigner. If this occurs then it is
possible for the Thai spouse to return half of the sum and then keep ownership
of the property, but usually the Thai spouse will not have the required money
to pay back and will keep the case in court. Thus the property will be put on
the auction market and resolved as previously mentioned, but during the court
proceedings there may be a criminal charge of forgery against the foreigner as
it is illegal to own property in this way under Thai law. Actually they didn’t
make a lease contract just to lease the land but to protect their investment, a
forgery case for a foreigner is a serious case with the penalty if convicted being
seven years imprisonment. This can become a tool for the other party to use
against the foreign to force a settlement and compromise, always be careful of
your actions and protect yourself by ensuring you are operating within the
limits of Thai law.
If you are in court
and are offered a compromise agreement to finish the case, it is recommended to
proceed though it is dependent on a case by case basis. The point is that the
judge also understands that it is your money and you will be the one that will
lose if money is not returned to you. The way to go about business like this
should always be made with the proper advice and counsel from a legal aid or
business professional in this field. Always make sure that you are protected
and are in the right in any business dealings. One thing to keep in mind is
that immovable property such as land cannot be held under a foreign citizen but
movable property such as a house built on that land can, as such it is possible
to go about this process legally. It is always better to lease the land from a
third party than from a spouse as it will seem like the two parties have
conspired to circumvent the law.
What
is right or wrong by law is not difficult to ascertain, usually all it takes is
common sense and it can save you from getting into a lot of trouble. Actually
if you execute a proper lease it is totally fine and legal, it also has the
benefit of being cheaper alternative to a transfer of ownership. Though through
leasehold you do not have the right to own property, you only the right to
possess it and depending on the contract made there are many options still
available to you.
THAI LAW - Leased property from a
spouse
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