Sectional Properties Act

This Act may be cited as the Sectional Properties Act.

The Act applies only to land held on freehold title or to leasehold land when the unexpired residue of the term is at least twenty-one years and there is an intention to confer ownership.

Defines the movable and immovable property of the Corporation associated with the units.

Defines how boundaries and certain elements of sectional units are described: a boundary is described by reference to a floor, wall or ceiling; a wall within a unit is a load-bearing wall; and, notwithstanding subsection (1), all doors and windows of a unit are part of the unit unless the sectional plan states otherwise.

Surveyors must provide certificates about boundary conformity and easements; surveyors must apply for county endorsement in the prescribed form; where a plan is for a building with units it must be endorsed by a surveyor or other person approved by the Director of Survey that the units correlate with the structure.

A proprietor may subdivide or consolidate a unit by registering a sectional plan with county government approval; before registering a proposed subdivision or consolidation the Registrar must amend the original sectional plan as prescribed by regulations.

Certain existing long-term sub‑leases must be reviewed to conform with section 54(5) of the Land Registration Act within two years; owners who already paid stamp duty are exempt from further stamp duty during that review; developers, management companies or owners may initiate the conversion; the Registrar must dispense with original title production in specified circumstances and must register a restriction if proprietors or developers fail to comply.

The owner of a unit is entitled to an easement for the subjacent and lateral support of the unit by the common property and by other units capable of affording support.

Section 15 creates easements against the owner of a unit: (a) for subjacent and lateral support, (b) to provide shelter, and (c) for passage or provision of services via pipes, wires, cables or ducts; and entitles utility service providers to benefit from appropriate implied easements (without excluding other utility owners).

Easements implied by this Act may exist even if they are not recorded on the register or expressly indicated; ancillary rights and obligations necessary to make those easements effective are included, including a right for the owner of the dominant tenement to enter the servient tenement and replace, renew or restore things they benefit from.

Surveyors are prohibited from preparing a sectional plan unless shown proof of ownership; a sectional plan must be accompanied by an application for registration by the corporation and a list of unit owners, with that list updated from time to time as needed.

When a sectional plan is registered the register of the parcel is closed; a separate register is opened for each unit; on payment of the prescribed fee a certificate of title (for freehold) or certificate of lease (for leasehold) is issued for each unit and must include its proportionate share in the common property; interests on the closed parcel register are endorsed on the new unit registers and on the sectional title deeds; no more than one unit may be referred to in one register and no other land except the apportioned share in the common property may be in that register; upon registration the unit's title is deemed issued under the Land Registration Act and thereafter dealings in the unit are governed by the Land Registration Act.

The Registrar must record each unit owner’s share of the common property in the unit register and on the sectional property title deed; unit owners hold the common property as tenants in common in shares proportional to unit factors.

Owners of the common property and each unit on a sectional plan have appurtenant rights to support, services, and access to light, and those rights include ancillary easement-like rights; the section does not affect parcels other than the parcel to which the sectional plan relates.

The owner of a unit is only liable for interests on the sectional plan in proportion to that unit's unit factor, except where an interest relates to a particular unit.

Sectional plans must include specific particulars; the proprietor must sign the plan; the survey office or authority must sign and seal it; and the Registrar must submit a copy of the registered sectional plan to the county government within twenty-one days of registration.

The Registrar must issue a certificate of registration for the corporation; the Corporation must have perpetual succession and a common seal.

The Corporation can sue and be sued in its corporate name, and may do anything a body corporate may do (subject to section 21); it may also sue in respect of damage or injury to common property.

Section 19 sets rules about liability in tort for common property: the Corporation is treated as owner/occupier of common property for proceedings and may recover judgments as a debt from proprietors; proprietors are deemed to have guaranteed payment; sums payable by the Corporation may be paid from a general fund if resolved in a general meeting.

Sets out duties and powers of the Corporation including insuring and maintaining common property, paying insurance premiums, enforcing by-laws, levying contributions, maintaining funds, and using technology.

Subject to this Act, the Corporation must have the powers reasonably necessary to carry out duties imposed by this Act and the by-laws; the Corporation must not carry on any trading activities.

Dispositions or dealings that affect the common property or land to become part of it must be executed under the Land Registration Act (Cap. 300) and approved by a unanimous resolution of the Corporation; no such disposition may occur until a meeting of the corporation is held in accordance with section 27.

The Registrar must not register a transfer of common property if any unit is subject to a registered charge, lease, or sublease until written consent of every registered chargee, lessee and sub-lessee to release their interest is produced.

Voting rights of a unit owner are set by the unit factor; owners may be prevented from voting in favour of unanimous resolutions or when a chargee present, and registered or first-priority chargees may exercise the vote; an owner or chargee may vote personally or by proxy.

Specifies who may vote when an owner is a minor or otherwise incapable and gives the Court power to appoint someone (including the Public Trustee) to exercise voting powers and to make orders to effect such an appointment.

Corporations must have a board of management and must file prescribed notices at the land registry within fifteen days when someone becomes or ceases to be a board member.

Meetings are to be convened ninety days from the day that fifty percent of the units are sold.

The board must convene an annual general meeting of the owners once every year and in any case within fifteen months after the previous annual general meeting.

Section 29 allows the Corporation to make by‑laws governing management and property; specifies what by‑laws cannot do; binds owners and the Corporation to by‑laws; requires county approval for material changes of common property; and permits use/keeping of guide dogs by blind persons.

Section 30 sets how by-law disputes are handled: a corporation or aggrieved owner may refer a breach to the Committee; when referring they must specify the by-laws; the Committee must determine the dispute and issue a written signed order; a corporation may only commence actions if authorized by its by-laws; non-compliance allows the aggrieved party to apply to Court; dissatisfied parties may appeal to Court.

Corporation may recover sums spent enforcing its duties from owners, may register a caution against an owner's unit for unpaid contributions (creating a charge with Land Registration Act priority), and must withdraw such a caution within thirty days after payment.

The Corporation may, if the by-laws permit, charge interest on any unpaid contribution balance owing to it by an owner.

If an owner owes interest under section 32 or a deposit, the Corporation may recover that amount as if it were a contribution under section 31.

If a Corporation registers a caution under section 31(4) it may recover from the unit owner the costs of preparing, registering and discharging that caution.

Subject to section 32, a Corporation may invest funds not immediately required only in investments a trustee may make under the Trustee Act (Cap. 167) and that are endorsed by a special resolution.

The Corporation must provide specified information on request; an aggrieved person may seek a Committee order to compel compliance, and the Committee can order compliance and impose penalties up to KSh 500 per day after 20 days.

If a Corporation requests a document, the owner of the land must provide a copy within twenty days without charge if they have it; a Corporation may make a written request before it has received the document.

The Corporation must maintain the insurance placed under subsection (1) or (2) on the units and common property; the developer may insure additional perils and has an insurable interest; the Corporation may continue such insurance unless prohibited by resolution.

The Corporation must, within twenty days of a written request from an owner (or an authorized person or the chargee of a unit) and upon payment of the prescribed charge, provide copies of insurance policies placed by the developer or the Corporation.

The Corporation may, by unanimous resolution and if its by-laws allow, grant a lease to a unit owner that permits exclusive use of part(s) of the common property.

A corporation can be directed by unanimous resolution to accept, on behalf of the owners, a grant of easement or a restrictive covenant that benefits the parcel.

A Corporation may be directed by unanimous resolution to execute, on behalf of the owners, a grant of easement or restrictive covenant; the Registrar must not register such an instrument unless it is endorsed and accompanied by a corporate certificate stating the unanimous resolution and necessary consents.

Lists the documents and charge details referred to in Section 43 related to the sale of units (purchase agreement, by-laws, management agreement, recreational agreement, lease or title, charges affecting title, sectional plan) and the particulars required for a prescribed notice concerning a charge (maximum principal, maximum monthly payment, amortization period, term, interest rate or formula, prepayment privileges).

Corporations may enter management agreements while the developer-owned majority controls the board; later-elected boards may terminate such agreements subject to conditions including a two-year no-termination period without cause (unless contract permits earlier termination) and a requirement that the Corporation give sixty days' written notice; the Corporation is not liable solely because it terminated under this section.

Owners of units may not rent their units until they give written notice to the Corporation specifying an address for service; owners must give undertakings to be liable for tenant-caused damage, must notify the Corporation of tenant's name within twenty days of tenancy start, and must notify within twenty days after ceasing to rent that the unit is no longer rented.

The corporation must notify the unit owner to take immediate action when a tenant contravenes the by-laws; if the owner fails to act, the corporation must notify the tenant to vacate; if the tenant refuses to vacate, the corporation must take necessary action against the tenant.

Termination of sectional property by unanimous resolution

When sectional status of a building is terminated under section 47, the Corporation must forthwith file with the Registrar a notice of termination in the prescribed form; after the Registrar makes the prescribed notification on the sectional plan, the unit owners are entitled to the parcel as tenants in common in shares proportional to their unit factors.

When sectional status of a building is terminated, the Corporation may, by a unanimous resolution, be directed to transfer the parcel or part of it.

The corporation is dissolved when the sectional property terminates; the Court may also declare the corporation dissolved on a date in its order.

The rating authority must assess rates, charges, ground rent and taxes for a parcel or part of it; units and their appurtenant share of common property count as separate parcels, and the common property does not itself form a separate parcel.

The Corporation is not liable for any rate, ground rent, charge or tax levied by a rating authority in relation to the parcel.

A county government, public authority, or a person authorized by them may enter and access any part of a parcel as necessary or expedient to exercise their powers.

Section 54 lists permitted methods for serving documents (physical delivery to a registered office or by registered post; personal service on a board member; or electronic transmission) and defines "document" to include summonses, notices, tax notices, orders and other legal process.

A Corporation may, by resolution of the board, change its address for service; the change does not take effect until a notice in the prescribed form is filed at the land registry.

The Corporation may charge a reasonable fee to cover expenses for producing and providing a document required under the Act.

Section 57 creates offences and penalties: failing to comply with section 13(1) or 43 makes a person guilty of an offence with a penalty up to 20,000,000 shillings or one year imprisonment; contravening the Act where no specific penalty is prescribed attracts a fine up to 250,000 shillings (subject to subsection (1)); and if a Corporation fails to comply each board member knowingly party to the failure is guilty and liable to a fine up to 250,000 shillings.

Purchasers may enforce purchase agreements even if the developer did not comply with the Act; purchasers have remedies under the Act in addition to other legal rights; waivers or releases of rights under the Act are void.

The Cabinet Secretary has the power to make regulations to implement this Act, including regulations about forms, sectional plans registration, fees, court application procedures, and other necessary matters.