Even prior to Covid-19 it wasn’t unusual for buyers or sellers to complete their property transactions remotely from outside Thailand. In fact, I would estimate upwards of 20% of our sales pre-Covid were completed at the land registry with one of the two parties in absentia. Now I’d put that number at closer to 40%. It’s not as cumbersome a process as one might think.

To complete a property transfer from abroad, a buyer or seller would need to give power of attorney to someone here in Thailand to act on their behalf. In the vast majority of cases in our office, this power of attorney is given to our staff who then represent them at the land registry. In a small number of cases, power of attorney would be given to their lawyer, family member, or trusted friend. We complete forms for the party with the information provided by them, send the forms to them via email. They then print them off, sign them, and along with copies of their passport and most recent Thailand visa page, have them notarized in their home country. The vast majority of western countries can now use any notary public, however, for some countries, it’s required that the documents are notarized at a Thai consulate. In the case where either party is married to a Thai national, an additional form from the land office must also be completed and notarized, as well as notarized copies of their marriage certificate and their spouse’s passport.

All of these documents, as well as the original title deed in the case of the seller, are then send back here to Thailand via DHL/FedEx and the transaction can move forward.

With regards to the financial side of things, wire transfers are generally made to the realtor to act as escrow agent and to get the correct documentation required by the land office from the banks. Funds are then dispersed as agreed.

It can be a bit daunting to purchase or sell something remotely, and there is a certain element of trust involved in the process, so choosing a good agent with experience in completing remote transfers is an absolute must – in lieu of this, finding a good lawyer with experience in such cases would be paramount.

The Covid Effect: Contract Clauses

I’ve basically been using the same contract for almost 20 years I’ve been practicing real estate here in Thailand. I’ve obviously made a few additions and deletions over the years to improve things, and there are almost always a few clauses that need to be tweaked for each individual sale, but the nuts and bolts of my contracts have changed very little over the years. But we now live in very different times.

We always try to give some breathing room in our contracts to allow for unforeseen delays and whatnot. Nobody wants to lose their deposit or lose a sale over something that’s avoidable or possibly out of the hands of the buyer or seller. With Covid now hanging over our heads like an ever-growing and ever-evolving cloud, we’ve had to take this into consideration with our sales contracts.

In the case of one of our recent sales, the buyer is travelling to Thailand at the end of June to complete the purchase, and the seller, who is currently in Thailand, will be travelling to the UK and back to Thailand again in the interim. As much as we’d like to hope their plans will go forward without hiccups, the risks need to be addressed – and while both parties are very accommodating people and have every intention of completing the sale no matter what, it really is something that needs to be put into the contract.

While we typically have a fourteen-day grace period in most of our contracts, we felt this just wasn’t enough to allow for unforeseen.

This part of the contract picks up after the buyer has paid the deposit. Have a look below:

For this clause the target transfer date stated below may be adjusted subject to conditions stated in Clause 3 due to Covid 19.

The remaining balance of Four Million Thai Baht (4,000,000 THB) is to be paid on or before the target transfer date of the 6th day of July 2021. Should the PURCHASER fail to pay the balance on the target transfer date, a grace period of fourteen (14) days will be given to allow the PURCHASER to complete the remaining balance payment. Should they not make the remaining payment within this period, through no fault of the SELLER, they will forfeit their right to purchase and any deposits paid.

Should the SELLER be unable to transfer on or before the target transfer date of the 6th day of July 2021, a grace period of fourteen (14) days will be given to allow the SELLER to complete the transfer. Should they be unable to transfer within this period due to the fault of the seller, the deposit shall be returned and the seller shall be responsible to pay the same amount additionally as compensation to the PURCHASER.

The above clause is fairly standard, but now with the addition of our ‘Covid Clause’ below:

The target transfer date stated in Clause 2 may be adjusted within reason to accommodate problems or restrictions that may be caused by Covid 19 and potentially delay either or both parties from being able to complete their obligations under Clause 2. This is to allow for problems such as:

a) Travel arrangements being canceled by the operator due to covid 19 restrictions.
b) Being tested positive for Covid 19 causes: Travel arrangements to be delayed, release from quarantine to be delayed, or inability to complete obligations on time.
Note: In Thailand, anybody who tests positive for COVID-19 is currently required to be transferred directly to a hospital for follow-up treatment and testing until released.
c) Change in Government Covid regulations/restrictions that delay either party or both from being able to comply with the obligations under clause 2. Such as:
increase in Quarantine time, Lockdown that prevents travel to complete the transfer, Closure of the land office.

Such kinds of problems shall constitute a reason to delay the transfer and are not a reason to withdraw from the sales agreement. Proposed changes in the target transfer date due to Covid 19 shall be substantiated reasonably by either party and the other party shall agree to the delay unless there is a justified reason to challenge the proposed delay time.

Again, as times change, hopefully, the necessity for such clauses will become a thing of the past, but I feel, for the time being, such things are necessary to not only discuss with clients but to put them right into the contracts and therefore more legally binding.

I’m more than happy if any agents out there want to use this clause verbatim or even just in essence as I think it’s very beneficial to all of us. Protecting our clients as well as possible (as well as ourselves of course) is something we’re always working towards.

Stu Sutton is managing director of Jomtien Property and Serenity Developments and has worked exclusively in the Pattaya/Jomtien real estate market for 18 years. Please feel free to contact him with any queries, compliments, or good jokes, [email protected] or visit Jomtien Property’s website at www.jomtien-property.com