19 agreements – documents to be executed for redevelopment
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The document outlines 9 agreements and documents that are typically executed for a redevelopment project: 1) Memorandum of Understanding, 2) Development Agreement, 3) General Power of Attorney, 4) Indemnity Bond by the Developer, 5) Bank Guarantee by the Developer, 6) Power of Attorney by the Society for sale of flats, 7) Agreement for allotment of flat of the same area, 8) Agreement for allotment of flat with additional area, 9) Ownership Agreement of Sale. It stresses that all agreements should be carefully drafted to protect the society's interests, competent legal advice should be sought, and documents should be properly stamped and registered with expenses borne by the developer.
19 agreements – documents to be executed for redevelopment
- 1. Sudhir Vaidya Agreements to be executed 19) Agreements – Documents to be executed for Redevelopment Sr. No. Agreements - Documents A 1 Memorandum of Understanding (MOU) : MOU is executed between The Society & The Developer, immediately after his selection by SGM. 2 Development Agreement: This is the detailed Agreement executed between the Society and the Developer. This Agreement needs to be drafted carefully to protect the interest of the society. Refer separate Chapter titled ‘Precautions to be taken by the society while drafting agreement with Developer.’ 3 General Power of Attorney: The General Power of Attorney is executed by Chairman, Secretary & Treasurer of the Society in favour of the Developer to carry out the various duties and also for liaison with various departments for obtaining permissions, NOC’s etc. 4 Indemnity Bond by the Developer: The Indemnity Bond should be obtained from The Developer stating that all work will be done as per development agreement, all formalities will be done within the framework of applicable laws, he will not exceed the power vested by POA and finally, he will indemnify the society for any wrong act on his part. 5 Bank Guarantee (BG) by the Developer: BG is executed by the Bank on behalf of the Developer. BG can be invoked in case the Developer fails to perform his obligations stipulated in Development Agreement and also fails to complete the construction / possession to members within the stipulated / agreed time frame. This would enable the society to get the BG amount from Bank, to be utilized to complete the construction. The Society should insist BG of 100 % of Construction cost of existing Flats.
- 2. Sudhir Vaidya Agreements to be executed2 6 Power of Attorney (POA) by the Society for sale of Flats: POA is executed by the Society in favour of the Developer allowing him to sale the additional flats, commercial establishments, shops etc. constructed as per approved Redevelopment Scheme. 7 Agreement for allotment of Flat of the same area: This agreement is executed by developer & existing members when same area is given. The agreement should stipulate details of new flat, corpus fund etc. 8 Agreement for allotment of Flat with the additional area: This agreement is executed by developer & existing members when additional area is given. The agreement should stipulate details of new flat, corpus fund etc. 9 Ownership Agreement of Sale: This Agreement is executed by the Developer & new members. B General: 1 All Agreements should be drafted carefully to protect the interest of the society. 2 The society should appoint competent Advocate for Drafting / Reviewing the drafts of all Agreements, MOU, POA, Letters to Authorities, NOC’s, and Permissions etc. given / executed by the Society. 3 Drafts should be circulated to members of the society for their comments, suggestions & information. 4 Final draft of various Agreements etc. should be approved by SGM. 5 It is needless to say that all Agreements, MOU, BG etc should be executed by paying appropriate stamp duty. 6 The said Agreements, MOU, should be registered by payment of Registration fees. 7 The expenses incurred for preparation of above documents, stamp duty, professional fees of Advocate, Registration charges, other out of pocket expenses should be borne by the Developer.