By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian developer says the proposed land reforms now before Parliament are “transformational” for this country’s citizens when it comes to “clarifying and transferring the ownership of wealth”.

Sir Franklyn Wilson, the Arawak Homes and Sunshine Holdings chairman, told Tribune Business the switch to a system of registered land means attorneys will likely sacrifice a significant portion of the current fees they earn for conducting title searches and addressing other conveyancing-related issues.

Suggesting that the move to a land registry, and obtaining “absolute title”, will be “enormously impactful” to fees currently pegged at around 2.5 percent of the real estate purchase price, he added that the reform benefits extend far beyond property developers such as himself.

“This is transformational,” Sir Franklyn told this newspaper of the Land Adjudication and Registered Land Bills. “It’s not just as a developer. This has enormous potential for the transfer and orderly disposition of wealth. Enormous.

“To illustrate, today in South Eleuthera, the challenge with land titles is a significant impediment to development. It’s not just there; it’s wider, but it may be more of an issue there than is normal. The second point is this: If you own something, and clearly show that you own it, that facilitates trade....

“This is transformational for the whole country. Transformational. I cannot think of anything else that has the capacity or the potential to clarify wealth, the transfer of wealth and the ownership of wealth. This is enormous, enormous.”

he Land Adjudication Bill, if passed into law by Parliament in its current form, provides an adjudicator - who must be an attorney with at least seven years’ conveyancing experience - and two other persons with the authority to form an adjudication tribunal. This tribunal will then assess and determine claims to land ownership in a particular area designated by the responsible minister.

Once these claims are adjudicated, they will be entered into a Land Registry, whose creation is backed by statute law as opposed to the present system of lodging and recording conveyancing deeds in the registry of records at the Registrar General’s Department.

The two Bills tabled by the Davis administration will thus work hand-in-hand, complementing each other to bring Bahamian land administration into the 21st century. However, the reforms represent “a fundamental shift” for attorneys who have become accustomed to conducting deeds searches, pronouncing title opinions and earning fees that are typically set at around 2.5 percent of the purchase price.

“You know how much legal fees won’t have to be paid because of this?” Sir Franklyn asked. “Right now this is impacting the legal profession in a way that is enormous. The whole need to pay legal fees for conveyancing is on the basis of a percentage.

“You are paying for two things. You are paying for legal advice. And, in effect, you are paying for insurance” if the deeds search is inaccurate and persons do not have clear and marketable title to a piece of real estate.

“The lawyers can justify their fee because, implicit in their fee, is insurance,” Sir Franklyn explained. “If there’s no need for that insurance it’s enormously impactful to legal fees.” He praised his daughter, Sharlyn Smith, who co-chaired the committee overseeing and guiding the Government’s land reform drive, adding that as a conveyancing attorney she is in effect giving up substantial income.

With the present paper-based deeds and searches system only able to offer “clear title” opinions, the two Bills now tabled in Parliament are designed to pave the way to a quicker, efficient process for determining land ownership that is more readily accessible and less expensive for all Bahamians.

Besides offering greater certainty over ownership and title, the amendments will modernise land administration and “bring us into line with most of the” British Commonwealth by finally concluding a reform effort that began over 60 years ago.

A 1984 Ministry of Housing report, produced when Hubert Ingraham was the responsible minister, said an inexpensive mechanism for establishing title to occupied land required “urgent” development and consideration. Subsequent reports have also warned that proof of land ownership, especially in the Family Islands, remains a major concern and impediment to economic development.

Land and its ownership is an issue that will touch every Bahamian at some point in their lives. Being able to confirm they have ‘absolute title’ to real estate, and are the true owners, will give citizens an asset that they can pledge as collateral to raise financing or use to develop businesses, thus generating economic and social empowerment.

The land registry is also viewed as a tool to reduce the number of real estate-related disputes in The Bahamas. An Inter-American Development Bank (IDB) report previously found that 15 percent of the parcels in the country were in dispute.

Given that 70 percent of the land is controlled by the Government, this report implied that only 15 percent of the remaining land, and which is in private hands, was not in dispute. Expressed differently, an the IDB study in the early 2000s found half the land in private hands in The Bahamas was subject to dispute.