How the New Property Transfer Law protects ageing parents at home

When 76-year-old widower Mohammed Abdul Wahab decided to hand his flat to his youngest daughter, fear kept him from signing. Under Bangladesh’s newly amended property law, aging parents no longer have to risk eviction or family bitter disputes just to settle their legacy while alive.

Until recently, there was no clear legal mechanism for arranging the transfer in precisely this manner. But the Bangladesh parliament has recently passed an amendment creating a legal tool to safeguard the interests of donors like Mohammed Abdul Wahab in specific cases of property transfer within the family.

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Now, a parent, grandparent, or spouse can transfer ownership to a child, grandchild, or spouse, while still retaining the right to use the property for as long as they are alive.  

The amendment can help reduce certain categories of family property disputes, although the lawyers interviewed also pointed to areas that could create new complications.

In Bangladesh, family property transfers are typically done through a “heba”, which is a gift deed and the most common method for transfers between family members. A will, or “wasiyat”, is used for transfers after death, although under Muslim Family Law it is limited to one-third of the estate, unless the heir consents to more. 

The amendment to the current law offers another route for property transfer.

Afrin Ahmed is an advocate at the Supreme Court of Bangladesh. She is a managing partner at L.A.W- Legal and Arbitration Wizards and a partner at Jural Acuity.

“The amendment is best understood as a new tool for family property planning and can provide greater security to an elderly donor, while allowing ownership to be settled during his/her lifetime,” says Ahmed.   

Md Saddam Hossen, who is an advocate at the Supreme Court of Bangladesh and has been practising in property and land law for over 12 years, further explains, “Once a parent transferred property via heba, they traditionally lost all legal control immediately.

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“If the child neglected them in the future, the parent had to rely on the Parents' Maintenance Act, 2013, or a civil suit to retain his/her rights.  To come to a solution, many families relied on unwritten promises (‘the house is yours, but I'll live here till I die’). These often fell apart in court because there was nothing enforceable behind them.”  

Hossen adds, “Parents can now keep what’s called a ‘life interest,’ which is essentially the right to live in a house, use it, and even collect rent from it if it's leased out, for as long as they are alive.

“The child owns the property, but their ownership is, in a sense, ‘on hold’. They can't occupy it, or fully benefit from it until the parent's life interest ends, which happens only when the parent passes away,” he clarifies.   

After the donor’s death, all these restrictions disappear. The child's ownership becomes complete.

This clearly fulfils Mohammed Abdul Wahab’s search for an alternative to the more conventional heba. However, both lawyers believe that one should not jump into resolving those new options without weighing the potential problems that might arise from it.

It is important to note that a valid lifetime gift transfers the property during the donor's lifetime. It therefore does not operate in the same manner as property simply passing to heirs upon the donor's death, and families should avoid treating this provision as simply a substitute for a will, as the legal consequences are different.

Afrin Ahmed adds, “If the recipient dies during the lifetime of the donor, the property passes directly to the recipient's heirs in accordance with law. However, the lifetime right of enjoyment by the donor remains attached to the property. So, the recipient’s death does not extinguish the donor's reserved lifetime enjoyment.

However, Advocate Saddam Hossen points to another potential area of friction.

Hossen also believes that a property transferred under this new law could be harder to sell or mortgage. Disputes could also surface between the new owner and third parties (buyers, banks) over valuation or the enforceability of deals.

He also says that the most sensitive issue is that the mechanism could be used in ways that sit uneasily with Islamic inheritance principles (heba, wasiyat, faraiz). 

The government, however, maintains that this new provision is optional and simply an additional tool that does not override religious family law.

To solve these problems, advocate Afrin Ahmed says, the transfer deed should clearly identify the property, the parties, the transfer of ownership, the precise scope of the donor's lifetime enjoyment, possession, income or rent, and the parties' respective rights and restrictions. Proper registration and independent legal advice are particularly important where elderly persons are involved.

The long-term usefulness of the provision will therefore depend not only on the existence of the new legal mechanism, but on how clearly families understand it, how carefully deeds are prepared and registered, and how questions arising in practice are eventually interpreted.

For people like Abdul Wahab, the amendment offers a new option: ownership can be settled during their lifetime without necessarily giving up the right to use the property for the rest of their lives. But as with any property transfer, understanding exactly what rights are being given away and what rights are being retained is crucial before signing the deed. One must also pay attention to the family dynamics before making any decision, as the very essence of this amendment is to solve problems and not create new ones.