DEED PREPARATION
Introduction
• Drafting is the process of writing details of the contract which is then signed and delivered by parties creating a legal obligation on them.
• A deed is a document constituting an agreement between the parties by which two or more persons agree to affect any right or liability. It is liable to stamp duty as is legally binding after stamping.
DRAFTING OF DEEDS
Rules of Drafting
some do’s:-
1. Avoid repetition of unnecessary words
2. Write concise and to the point sentences
3. Choose the right words
4. Prefer active sentences in comparison to the passive ones.
5. Express ideas in fewer words
6. Know the exact meaning of the words & sentences you are writing.
7. Put yourself in the place of the reader, read the documents and satisfy yourself about the content, interpretation and sense it carries.
Some don’t:-
1. Avoid the use of words of similar sound
(Ex. Employer & Employee)
2. we should avoid the use of words “Less than” or “more than”, instead use “not exceeding”
3. Negative use of words in successive phrases would be very precisely employed.
Components of Deeds
01
Deed title
02
Place & date of execution
03
Description of parties
04
Recitals
05
Testatum (witness clause)
06
Consideration
07
Receipt clause
08
Operative clause
09
Description of property
10
Exceptions & Reservations
11
Parcels clause
12
Premises & habendum
13
Covenants & undertakings
14
Testimonial Clause
15
Signature and attestation
16
Endorsement & Supplemental deeds.
17
Annexure or schedules.
Description of the Deed Title:-
• The deed should contain the right title like
“ This Deed of Sale”
“ This Deed of Gift”
“ This Deed of Conveyance”
“ This Deed of Lease”
Place and Date of Execution of Deed
• Date in the context of deed is the date on which deed has been brought into effect.
Description of parties
• All the parties to the deed including inter-parties should be duly described.
• While describing the parties transferor should always be mentioned first and the transferee comes in the last.
Recitals
• Recitals contain the short story of the property up to its endowment to its transferors.
Consideration
• As stated over, consideration is crucial in a document and must be expressed.
• In the absence of citation of consideration would attract penalties under the Stamp Act.
Description of Property
Registration laws in India bear that full description of the property is given in the document which is presented for registration under Registration Act.
Signature and Attestation Clause
Attestation is necessary in the case of some transfer like mortgage, gift, sale, etc.
Types of Deeds
RENTAL AGREEMENT
• A rental agreement is an official contract signed between the owner of a property and the tenant who wishes to take temporary possession of the property for the said period.
• Rental agreement in India can be of to types, one being a lease agreement that lasts for a minimum of 12 months. The other being a lease and license agreement of up to 11 months which doesn’t fall under the Rent Control Laws.
AGREEMENT FOR SALE OF FREEHOLD PROPERTY
• By registration of sale deed freehold property can be transferred.
• Usually, a transaction of a sale of immovable property involves 2 documents,
o Agreement to sell and
o the Conveyance Deed i.e. sale deed.
• But with only a Sale Deed the transaction of sale can be completed
AGENCY AGREEMENT
• An agency agreement is a legal contract that binds the principal to the agent for the agreements entered by agents, the principal himself being personally liable, creating a fiduciary relationship whereby the first party ("the principal") agrees at the actions of a second party ("the agent").
• The power of the agent is to bind the principal legally by Agency Agreement.
SERVICE AGREEMENT
• A “service contract” is evidently defined terms and conditions of employment in regards to the agreement between the employer and employee of the organization.
• This type of contract outlines a service that a contractor/employee provides to a client in exchange for compensation.
PARTNERSHIP AGREEMENT
• A partnership contract also called the articles of partnership,
• It is a document that establishes the terms of the partnership and the agreements between partners.
• Whenever a new business is formed with a partner it’s best to have an attorney draft a partnership contract to reduce future conflicts.
GIFT DEED
• The gift deed is an instrument through which the immovable or movable property owner transfers his/her property to another person without consideration as a gift.
• Registration of the gift deed is mandatory when the donor wishes to gift immovable property to the donee.
WILL
• A will deed ensures that the disposal of a person’s property is according to his wishes, thereby, preventing any future dispute between the heirs. It is a legal declaration by a person, providing directions for the disposal of his personal property on his demise.
• A will can be revoked or edited as per the requirements of the creator of the will.
Deed of Tenancy
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