• Registration of MoU

We are under going talks with our landlord who is also a builder for redevelopment.... We are entering into Mou with him before consent which covers the points to which he agreed to. A little confused whether MOC can be registered or not. Many people told us that it cannot be registered while some are of the opinion that we can register it. Please let me know what can we do and can we legally challenge the builder if he doesn't fulfil the terms mentioned in MOU. Can we revoke our consent (which is an IRREVOCABLE Consent)? Will appreciate your immediate response. We are in the process of registering Tenants Association can you also provide any guidance on this as well. Thanks, Zeba
Asked 2 years ago in Property Law from Mumbai, Maharashtra
1. Enter into a agreement for redevelopment , not MOU.
2. MOu is not legally enforceable as it is a precursor to a detailed agreement to be executed later on.
3. So enter into an agreement than a MOU.
4. The agreement containing the relevant clauses for relocation is legal enforceable and need not be compulsorily registrable document.
5. Tenants Association will not create any more extra judicial protection and it is just an option.
Devajyoti Barman
Advocate, Kolkata
5248 Answers
54 Consultations
4.9 on 5.0
1)M0U cannot be enforced in court of law 

2) it can be legally enforced only if it is executed for monetary exchange 


3) it does not grant substantive rights just captures intention of parties 

4)you can register the MOU 

5) in the vent builder fails to fulfill terms mentioned in MOU you should incorporate termination clause . 

6)get MOU vetted by a local lawyer . 

7) it is better to enter into agreement for redevelopment and have it auly stamped and registered 

8)you can register your tenant association with consent of landlord
Ajay Sethi
Advocate, Mumbai
23386 Answers
1229 Consultations
5.0 on 5.0
Hello,
1) MOU can not be enforced as it does not include a consideration 

2) As such the MOU is only an understanding and falls short of an Agreement that can be enforced in law.

3) And so you can not register the MOU.

4) In order to cover yourself it is advisable to include a clause regarding termination 

As such an MOU  is actually just a means for two parties to reach a decision. It is used to gauge the intention of the transacting parties before a deal is officially signed between them and doesn't grant either of them any rights. So, in some cases, it may make more sense to opt for a softer, non-legal document than a legally binding one.

Sometimes, situations warrant the use of a softer document that only captures the intention of the parties till a more definitive agreement can be drawn up. So, an MoU is a good choice.MoUs are very handy even in matters where the final deal would depend on the fulfilling of certain conditions.

You can form and register a Tenants' Association and inform the landlord developer about the same.
S J Mathew
Advocate, Mumbai
1954 Answers
66 Consultations
5.0 on 5.0
1. MOU is registrable,

2. You are advised to execute and register a Re-Development Agreement with your lawyer incorporating all your clauses regarding area to be allotted after construction is over, your payment if any, period of construction and the amount of rent to be paid if there is any dealy in construction etc.,

3. Engage a local lawyer having expertise in this field.
Krishna Kishore Ganguly
Advocate, Kolkata
12143 Answers
233 Consultations
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1) you have to incorporate clause in agreement to safeguard your interests .

2) the period within which building would be completed by developer . 

3) consequences in case builder fails to complete project on time . 

4) bank guarantee to be provided by builder . 

5) provision for alternative accommodation by builder till building is completed . 

6) if there is unity among tenants landlord wont be able to redevelop the property without consent of tenants
Ajay Sethi
Advocate, Mumbai
23386 Answers
1229 Consultations
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1. You need not be a co-Operative society to enter into a Redevelopment Agreement with the landlord,

2. All the tenants like you can collectively be a party to the said Redevelopment Agreement,

3. You should be very careful while drafting the said agreement and must put a clause that the landlord can start selling the flats only after providing you the accomodations as mentioned in the said Re-Development Agreement,

4. If you have good bargainable position, you also can incorporate a clause in the said Agreement stating that the temants (or their representative if the numbers of tenants are high) shall have to a consenting party in all future sale deeds to be executed and registered by the land owner while selling flats from his Re-Developed constriuction.
Krishna Kishore Ganguly
Advocate, Kolkata
12143 Answers
233 Consultations
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MOU is not legally binding if they are drafted by a lawyer and signed by witnesses. is actually just a means for two parties to reach a decision. It is used to gauge the intention of the transacting parties before a deal is officially signed between them and doesn't grant either of them any rights.

Sometimes, situations warrant the use of a softer document that only captures the intention of the parties till a more definitive agreement can be drawn up. So, an MoU is a good choice, but it is weak piece of document.
Shivendra Pratap Singh
Advocate, Lucknow
2792 Answers
41 Consultations
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you should go with registered agreement because agreements are usually registered documents that are recognised by courts of law and grant substantial rights to both parties. If either party defaults on the conditions stated in the document, the aggrieved party can file a case for breach of contract.

Precautions while drafting an MoU Since an MoU cannot be legally enforced, you need to be careful while drafting it. If anything goes wrong or the other party violates the terms and conditions, you will have no legal recourse or even any body/organisation that could help you with your grievance. A non-binding MoU can only be used to show that the other party had agreed to the conditions, but it cannot be used to bring him to book, be warned that you cannot get the MoU enforced.
Shivendra Pratap Singh
Advocate, Lucknow
2792 Answers
41 Consultations
4.9 on 5.0

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