BackCan a nominee be included in a builder-buyer agreement?
Safeguarding property ownership rights is paramount for every individual, and understanding the nuances of a builder-buyer agreement is crucial
PremiumWhat are the possibilities and implications of adding a nominee to a builder-buyer agreement?
—Name withheld on request
Safeguarding property ownership rights is paramount for every individual, and understanding the nuances of a builder-buyer agreement is crucial. In an ideal scenario, any agreement, including a builder-buyer agreement, should list all parties involved. If the allottee or purchaser’s name is specified, there is usually a provision allowing the allottee to include heirs, executors, and administrators.
Let us, for instance, consider the hypothetical case of Sharma, who purchases a property through a builder-buyer agreement, and his name is mentioned as the allottee. To secure his family’s interests, Sharma has the option to include his heirs in the agreement, ensuring they can claim his rights, title, and interest in the property in the event of his untimely demise. However, recognizing the importance of nomination, Sharma may choose to add a separate clause in the agreement expressly nominating his heirs in case of any unforeseen event. It is important to note that while the nominee has a temporary status, all heirs are entitled to the assets of the allottee if he passes away without making a will.
The builder-buyer agreement typically allows the inclusion of heirs, executors, and administrators of the allottee or purchaser. In the unfortunate event of the allottee’s untimely demise, his heirs have the legal entitlement to claim his rights, title, and interest in the property from the builder, as stipulated in the agreement. To proactively address this, the allottee can expressly record a nomination by adding a separate clause in the agreement. This nomination allows the allottee to specify his chosen heirs who would have a claim to the property in case of an unforeseen event.
It is crucial to understand that while nomination provides a temporary arrangement, the legal rights to the property are ultimately governed by the inheritance laws if the allottee passes away without creating a will. In such cases, all heirs have an equal entitlement to the assets of the deceased allottee, reinforcing the importance of thoughtful estate planning in property transactions.
Aditya Chopra is managing partner and Amay Jain is Senior associate at Victoriam Legalis—Advocates & Solicitors.
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