Formalities required to transfer movable property

Property is anything that is owned by a person or entity. Mainly, property is divided into
two types as,

 Movable Property - The objects/assets that can be moved from one place to another
with ease. Movable properties can be further divided into,
o Tangible property – These properties are that can be moved, touched and felt.
Example includes ornaments, furniture etc.
o Intangible properties – These can’t be literally moved, touched and felt but are
considered movable because of their nature. Examples include securities,
bonds, etc.
 Immovable Property - These are the types of assets that cannot be shifted without
destroying or altering it. Examples include, land, buildings, fisheries and etc.

Transfer of movables is governed by the provisions of Sales of Goods Ordinance which is

based on English Law. The transfer of movables other than their sale (gift, loan, lease, and
hire-purchase) will not be covered under the sales of goods ordinance. Governed by the
principles of Roman Dutch Law.

The law relating to sales of goods in Sri Lanka is, Sale of Goods Ordinance No.11 of 1896.
Under this particular law, it has defined that the “goods include all movables except
money”.

As stated in the ordinance, a contract for sale of goods can occur in following ways,

 By written words
 By verbally
 By partly in writing and partly verbally
 Implied by the conduct of the parties
 Registration normally does not apply to movable unless a specific law requires it.
(Motor vehicles the motor traffic act requires registration and ownership is proved
by the registration book)

Formalities required to transfer of the beneficiary in immovable property

Special formalities apply to the transfer (sale, mortgage, or lease) of immovable property.
Such transfers should be by a notarial document and must be registered at the office of
registration of lands. The general law governing the transfer of immovable in Sri Lanka is
Roman Dutch Law.

Under the section 2 of the Prevention of Frauds Ordinance No. 7 of 1840 the following are
not valid and enforceable unless they are in writing and signed in the presence of a licensed
notary public and two or more witness and asserted by the same notary.

 Any land purchase transfer Assignment and mortgage of land or other immovable
property.
 Any contract or agreement for future sale or purchase of land or immovable
property.

But according to the Registration of Documents Ordinance of 1927 confers priority while
registration of the movable property registration is not essential for validity. Registration
plays an important role when dealing with the land.

As a general rule a minor a person under 18 years of age cannot transfer movable property
without the approval of a court of law. On the other hand any movable property of a minor
can be transferred with the approval of the minor's guardian.

Methods of transferring property are as follows,

 Sale: Transfer of ownership by a deed (sale deed/transfer deed) for a price. The
sale deed is compulsorily required to be stamped (stamp duty) and registered
(before a Sub-Registrar) and is for consideration.
 Lease: This is transfer of the right to enjoy a property, for a certain period, express
or implied. If the lease period is for more than 11 months Registration of
Documents Act has mandates registration. The registration process involves
payment of stamp duty and registration fees.
 Mortgage: Transfer of interest in the specific immovable property by way of a
mortgage deed or deposition of title deeds for securing payment of a loan. The
property owner (mortgagor) may either deposit title deeds of immovable property
to the lender (mortgagee).
 Gift deed: Transferring by a gift deed is when property is transferred voluntarily
without any consideration. Under the Registration of Documents Act, it is
mandatory to register a gift deed with the sub-registrar.
 Relinquishment: Transferring a property by family arrangement where one legal
heir surrenders his share in the property with or without monetary consideration
for another legal heir. (Singhania, 2016)
Conclusion

Law is a concept designed to keep life fair, just and orderly and which also applies to
businesses. Law provides everyone with a framework for how to act and operate which
holds people and businesses and how to be accountable for their actions. The employees
works within an organization should be knowledgeable on the concepts of law, which is
imposed on them, so does the Quantity Surveyors and Facilities Managers.

Law of property is an area of civil law which governs concerns on property. Those
properties can be categorized in several ways but the simplest and the most common way
is categorizing as movable and immovable property. There are different laws which effects
on the concerns related to these properties; as such major areas are governed with
Prevention of Frauds Ordinance, Sales of Goods Ordinance of Sri Lanka, and Registration
of Documents Ordinance.

Through the course work, what contracts /agreements (relating to buildings and lands)
should be in writing with respects to the Prevention of Frauds Ordinance and the effect of
non-compliance with this statute according to the Prevention of Frauds Ordinance were
identified, the process of registering an instrument affecting land and building is discussed,
formalities required to transfer of movable and beneficiary of immovable property was
recognized and the “Priority Concept “under the Registration of Documents Ordinance
was deliberated.
Individual Contribution

Dissanayake S.U.

Identified the formalities required to transfer the movable property and the beneficiary of
immovable property by referring A Text Book of Commercial Law by Weerasooriya W.
and by referring online sources. Firstly the root of classification of movable and
immovable property was identified with the examples. The law governing movable
property of Sri Lanka was identified as Sale of Goods Ordinance No.11 of 1896 and the
formalities were identified. Modes of transferring immovable property were discussed and
identified the enforcement of Prevention of Frauds Ordinance No. 7 of 1840 and
Registration of Documents Ordinance of 1927 for immovable property. Conclusion was
prepared.

Works Cited
Mittal, P. K. (23, November 2017). What are the movable and immovable property? Retrieved
August 27, 2018, from Linkedin: https://www.linkedin.com/pulse/what-movable-
immovable-property-pradeep-kumar-mittal/

Singhania, R. (2016, September 28). Procedure Of Transfer Of Immovable Property. Retrieved

August 27, 2018, from Singhania and Partners: https://singhania.in/procedure-of-
transfer-of-immovable-property/

Weerasooriya, W. (2014). A Text Book of Commercial Law (Business Law) (4th ed.). Bttaramulla,
Western Province, Sri Lanka: Print Wave (Pvt) Ltd.