TRW & Co · Land and property
Landowner-Developer Joint Venture Agreements in Chattogram
A land developer agreement Bangladesh landowners sign decides who gets which flats, what happens if the developer is late and how the land is protected if the project fails. This guide explains the sharing ratio, signing money, timetable, power of attorney, CDA approvals and the Real Estate Development and Management Act 2010 remedies, with recent High Court guidance from a Chattogram dispute.
Key pointThe two clauses that most often decide a landowner's fate are the unit-by-unit allocation schedule and the scope of the power of attorney. A percentage without a schedule, or a general power without limits, is where most Chattogram development disputes begin.
At a glance
REDMA 2010 applies
The Real Estate Development and Management Act 2010 governs developers' dealings with landowners and buyers, and the CDA acts as the authority for the Act in Chattogram.
Section 36: arbitration
Disputes must first be tried amicably; then the aggrieved party serves notice to arbitrate under the Arbitration Act 2001, with the tribunal to be constituted within 30 days.
District Judge can appoint
In a 2025 Chattogram case, the High Court Division directed the District Judge to appoint the defaulting developer's arbitrator under section 12 of the Arbitration Act.
Power of attorney is key
A limited, registered power of attorney that covers only approvals and the developer's own units protects landowners from unauthorised sales and mortgages.
Schedule the units
Attach a schedule naming each side's flats, parking and shops by floor and position, with a formula for changes when the CDA plan is approved.
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The short answer
A land developer agreement Bangladesh landowners sign is a joint venture in all but name: the family contributes the land, the developer obtains approvals, finances and builds, and the finished flats, parking and commercial space are divided in an agreed ratio. In Chattogram, most apartment buildings on family plots are built this way.
The agreement is governed by the Real Estate Development and Management Act 2010, the general law of contract and property, and the Chattogram Development Authority's planning controls. The landowner's protection depends on five things being settled in writing before signing: the sharing ratio by specific unit, the signing money, a timetable with delay compensation, a limited and registered power of attorney, and a dispute clause that works. This article explains each, with the remedies when a developer defaults.
The legal framework
Several laws apply at once. A landowner negotiating a land developer agreement Bangladesh developers have drafted should know which law answers which question.
Real Estate Development and Management Act 2010
The 2010 Act regulates developers of plots and apartments, their dealings with buyers and landowners, and handover. In Chattogram the Chattogram Development Authority (CDA) acts as the authority for the Act. Section 15 deals with compensation when a developer fails to hand over on time. Section 36 sets the dispute route: the parties first try to settle amicably, and if that fails the aggrieved party serves notice to invoke arbitration under the Arbitration Act 2001, with the tribunal to be constituted within 30 days of the notice. The Act also creates offences, including a developer's failure to hand over the landowner's agreed share, which are tried before magistrates.
Contract, property, registration and powers of attorney
The agreement is a contract under the Contract Act 1872. It is executed and registered at the sub-registry with jurisdiction over the land under the Registration Act 1908. The power of attorney that lets the developer obtain approvals and sell its share must comply with the Power of Attorney Act 2012, which also governs revocation. The Specific Relief Act 1877 supplies specific performance and injunctions, and the Land Crimes Prevention and Remedy Act 2023 adds criminal liability for some fraudulent dealings, such as selling the same property twice.
CDA planning control and the industry code
Building permission in the metropolitan area comes from the Chattogram Development Authority: land-use clearance, any special project approval and building design approval, with structural and fire standards from the Bangladesh National Building Code 2020. A 2017 Ministry of Commerce notice made membership of REHAB, the developers' association, compulsory for developer companies, and REHAB's code of conduct expects completion dates and delay compensation to be written into the deed.
What every land developer agreement Bangladesh families sign should cover
Developers often arrive with a printed form. Some are balanced; many say little about what happens if the project stalls. These are the terms that decide who carries the risk.
| Term | What to settle | Why it matters |
|---|---|---|
| Sharing ratio | Each side's percentage of flats, parking and commercial space, then a schedule naming units by floor and position | "50:50" disputes arise when better floors, corner flats or ground-floor shops are not allocated in advance |
| Signing money | Amount, payment dates, and whether it is refundable or adjusted against the landowners' share | Often the landowners' only cash until handover; the agreement should say what happens to it on termination |
| Timetable | Deadlines for plan submission, CDA approval, start of work, completion and handover, with any grace period | A clear start point (for example, the date of plan approval) makes delay measurable |
| Delay compensation | Monthly rent or compensation to landowners from the handover deadline until actual handover | Links to section 15 of the 2010 Act and the REHAB code; avoids arguing about loss later |
| Specifications | Materials, fittings, lifts, generator, finishes, in an attached schedule | Prevents downgrading of the landowners' flats compared with those sold to buyers |
| Power of attorney | Scope, registration, and when it ends or can be revoked | A wide power lets a developer sell or mortgage what is not its own |
| Finance and mortgage | Whether the developer may mortgage the land or project, and on what conditions | An unpaid project loan can stall the whole building |
| Termination and disputes | Default events, notice and cure periods, consequences, and the arbitration route | Section 36 of the 2010 Act points to arbitration; the clause should make appointment simple |
Two further points deserve attention in any land developer agreement Bangladesh practice now treats as standard. First, attach the approved building plan, or a draft plan with a formula for adjusting each side's share if the final approval changes the number of flats. Second, list who pays for what: utility connections, the generator, CDA fees, the flat owners' association set-up, and the registration costs of transferring the developer's flats to buyers.
How the process runs, step by step
- Check your own title first. Confirm deeds, khatians, mutation and land development tax. Every co-heir must be identified; a missing heir can stall registration of every flat later. Our title verification team covers this.
- Check the planning envelope. Road width, zoning, hill or water-body constraints and any acquisition notice decide how many floors the CDA will approve, and so how many flats there are to share.
- Vet the developer. Look at its company records, REHAB membership, completed projects in Chattogram, pending litigation and finances. Visit a finished building and speak to its landowners.
- Negotiate the terms. Settle the ratio by unit, signing money, timetable, compensation, specifications, power of attorney limits and the dispute clause. Do not sign a printed form unread.
- Execute and register. Register the agreement and a separate, limited power of attorney at the sub-registry. All co-owners sign, or attorneys with valid authority sign for them.
- Approvals and construction. The developer obtains CDA approvals and builds. Ask for copies of approvals and periodic progress reports, and inspect against the specification schedule.
- Allocation and handover. Receive the landowners' flats by the schedule, with possession letters, and set up the owners' association. The developer then transfers its own flats to buyers by registered deed.
Tie the start of the construction period to a defined event, such as the date of CDA building approval, and put a long-stop date on the approval itself. In one Chattogram case the developer took more than three years to obtain approval before the construction clock even started.
The power of attorney: the document that carries the risk
The developer needs authority to apply for approvals, deal with utilities and sell its own share of flats. Landowners often sign a broad "irrevocable general power of attorney" to give it. That is where most landowner losses begin, because a wide power can allow a developer to sell or mortgage units that belong to the landowners, or the land itself.
Limit the power to what the developer genuinely needs: approvals, construction-related applications and the sale of the developer's allocated units listed by number. Register it. State that it ends on completion of the project or on termination of the agreement. Under a properly drafted land developer agreement Bangladesh landowners can then revoke the power on the developer's default without arguing about its scope. Our power of attorney lawyers draft and review these documents.
Revocation is not a cure-all. Sales already registered by the developer within its authority are hard to undo, and buyers who paid in good faith have their own claims. Prevention, through a narrow power and a clear allocation schedule, is far cheaper than litigation.
Delay, penalties and termination
Delay is the commonest problem under any land developer agreement Bangladesh landowners enter. Approvals take longer than planned, costs rise, the developer runs short of money, or a co-owner dies and heirs dispute the deal. The agreement should answer three questions: what compensation is due for delay, when a delay becomes a default, and what happens to the project if the agreement is terminated.
Compensation for delay
Section 15 of the 2010 Act addresses compensation where a developer fails to hand over on time, primarily at the rate agreed in the contract. Monthly rent to the landowners from the handover date until delivery is the usual mechanism. Write the amount, the start date and the payment day into the agreement; an express clause avoids argument.
Termination and arbitration under section 36
The High Court Division has explained how this works in a dispute from Chattogram. In Civil Revision No. 263 of 2024 (judgment of 10 March 2025), a landowner's agreement allowed 30 months plus a 6-month grace period from plan approval. The CDA approval came more than three years after the land was handed over, and the developer then failed to complete the building. The landowner cancelled the power of attorney under the Power of Attorney Act 2012, served notice under section 36(1), and gave notice of arbitration naming an arbitrator.
The developer did not appoint one, arguing among other things that the agreement had no arbitration clause. The High Court Division directed the District Judge, Chattogram to appoint the arbitrator for the developer under section 12 of the Arbitration Act 2001.
In Civil Revision No. 5705 of 2024 (judgment of 1 July 2025), a Dhaka case, the court held that where the agreement requires the parties first to try to agree on a sole arbitrator, that step must be followed before applying to the District Judge. The lesson for both sides is the same: follow the dispute clause and section 36 precisely, and keep proof of every notice. Our arbitration lawyers run these proceedings, and a land developer agreement Bangladesh landowners sign today should be drafted with these decisions in mind.
Criminal and civil remedies
Alongside arbitration, the 2010 Act's offence provisions can apply where a developer fails to hand over the landowners' agreed share, and the Land Crimes Prevention and Remedy Act 2023 can apply to double sales and some fraudulent transfers. Civil courts can grant injunctions to stop sales of the landowners' units or further mortgages while a dispute is resolved.
An illustrative scenario
Illustrative only; no real parties. Four siblings own a plot in a residential area of Chattogram and sign a developer's printed agreement for a 50:50 share, with a general power of attorney. Five years later the structure stands at three floors and work has stopped. The developer has sold several flats, including two on floors the siblings expected to receive.
A lawyer reviews the papers. The agreement has no unit schedule, so the "50 per cent" cannot be pinned to specific flats, and the power of attorney does not limit sales to the developer's share. The siblings serve a section 36 notice, revoke the power, publish a notice warning prospective buyers of the dispute, and start arbitration while seeking an injunction against further sales. The case is winnable but slow. A one-page allocation schedule and a narrow power at the outset would have prevented most of it.
Risks and common mistakes
Signing a ratio without a unit schedule
A percentage on its own invites a dispute at handover, when both sides want the better floors, corner flats, parking bays and ground-floor shops. Attach a schedule naming each side's units by floor, position and approximate area, with a formula for adjusting shares if the CDA approves more or fewer flats than planned. Update the schedule by a registered supplementary agreement once the final plan is approved, so that buyers can see which units the developer is entitled to sell.
Leaving a co-owner out
Much Chattogram land is held by several heirs, some living abroad. If one co-owner does not sign, or signs through an attorney without valid authority, the project carries a defect that surfaces at handover or registration. Identify all co-owners and shares first, document inheritance, and have every co-owner sign or give a properly executed power. The agreement should also say how heirs step in if an owner dies mid-project. Our inheritance lawyers often resolve these questions before signing.
Letting the developer build beyond approval
Extra floors or a change of use outside the CDA approval may look like more flats to share, but they expose the building to enforcement, complicate registration and utility connections, and make bank finance harder for buyers. The agreement should oblige the developer to build strictly to approved drawings and to bear the consequences of any deviation. Landowners should keep copies of the approval and compare progress against it. Our CDA approval lawyers advise on both sides.
Waiting too long when the project stalls
Landowners sometimes wait years for a stalled developer to resume work. Meanwhile buyers pay money, the developer may borrow against the project, and the options narrow. Serve a formal notice under the agreement and section 36 early, record the state of the site with photographs and an engineer's report, and take advice on termination, a takeover by another developer, or arbitration. Delay rarely improves the landowner's position.
Probashi landowners and foreign capital
Many Chattogram plots have co-owners, and a land developer agreement Bangladesh developers accept must bind all of them. Co-owners living in the Gulf, the UK, Singapore or Malaysia can join a development without travelling by giving a power of attorney limited to signing the agreement and the related power, executed and authenticated in the prescribed manner abroad. A broad power to a relative is risky; a narrow one tied to the specific land and agreement is safer. Our NRB property lawyers coordinate execution with the firm's offices in London, Dubai and Singapore.
Where foreign or non-resident money funds a developer, foreign exchange rules and investment registration questions arise. Since the Invest Bangladesh Authority succeeded BIDA under the Invest Bangladesh Act 2026, investors should check current registration requirements before money is remitted.
Checklist before you sign
- Title, mutation, tax and every co-owner confirmed, with inheritance documented.
- Planning envelope checked: road width, zoning and any constraints on the plot.
- Developer vetted: company records, REHAB membership, past projects and litigation.
- Ratio fixed by a unit schedule, with an adjustment formula tied to the approved plan.
- Signing money, timetable, delay compensation and specifications in writing.
- A limited, registered power of attorney that ends on completion or termination.
- A dispute clause that works with section 36 and makes appointing an arbitrator simple.
A well-drafted land developer agreement Bangladesh courts can enforce is the best protection a landowning family has. Our real estate development lawyers at the TRW & Co Chattogram office negotiate and review these agreements, and act when projects go wrong. Buyers of flats in these projects should also read our flat buying checklist. Contact us at info@trw.co or +880 1779 127165.
Frequently asked questions
01What is a fair sharing ratio between landowner and developer in Chattogram?
There is no legal standard ratio. The split depends on the land value, location, road width, the number of floors the CDA will approve, construction costs and the signing money paid. Equal splits are common in some areas and different ratios in others. Whatever the ratio, the agreement should translate it into a schedule naming each side's flats, parking and commercial units by floor and position, with a formula for adjusting shares if the approved plan changes.
02Does a landowner-developer agreement have to be registered?
The agreement and the power of attorney given to the developer should be executed and registered at the sub-registry office with jurisdiction over the land. Registration protects both sides, gives the agreement evidential weight, and lets buyers see what the developer is entitled to sell. An unregistered or informal arrangement exposes landowners to disputes over allocation and authority that are hard to resolve later.
03Can I cancel the agreement if the developer delays?
Possibly, depending on the agreement's default and termination clauses and the facts. Serve formal notice under the agreement and section 36 of the Real Estate Development and Management Act 2010, which requires an attempt at amicable settlement before arbitration. Revoking the power of attorney is often part of the response. Take advice before acting, because a wrongful termination can expose the landowner to a counterclaim, and buyers of the developer's units may have rights.
04What compensation can a landowner claim for late handover?
Section 15 of the 2010 Act provides for compensation where a developer fails to hand over on time, primarily at the rate the parties agreed. In practice, agreements usually provide monthly rent to the landowners from the handover deadline until delivery, and REHAB's code of conduct expects delay compensation to be written into the deed. Put the amount, start date and payment terms in the agreement to avoid disputes.
05What if the agreement has no arbitration clause?
Section 36 of the 2010 Act itself sets out a route: amicable settlement first, then notice to invoke arbitration under the Arbitration Act 2001. In a 2025 decision arising from Chattogram, the High Court Division directed the District Judge to appoint an arbitrator for a developer who had failed to do so, despite the developer's objection that the agreement had no arbitration clause. Where the agreement does contain a procedure, follow it precisely.
06Can a landowner living abroad sign a development agreement?
Yes. A co-owner abroad can sign through a power of attorney executed and authenticated in the prescribed manner, limited to the specific land and the development documents. Avoid broad general powers to relatives. The agreement should also deal with what happens if a co-owner dies during the project, so that heirs can step in without stalling approvals or registration.
Sources and official materials
- High Court Division, Civil Revision No. 263 of 2024 — Chattogram landowner-developer dispute; section 36 and appointment of arbitrator
- High Court Division, Civil Revision No. 5705 of 2024 — Following the agreed dispute clause before applying for appointment
- Power of Attorney Act 2012 — Powers of attorney and revocation
- The Registration Act, 1908 — Registration of agreements and deeds
- Arbitration Act 2001 — Appointment of arbitrators and procedure
- Land Crimes Prevention and Remedy Act, 2023 — Double sales and fraudulent transfers
- Chattogram Development Authority — Building approvals and authority under the 2010 Act
General information only, current as at 27 October 2026. It is not legal advice and does not create an advocate–client relationship. It reflects the law of Bangladesh unless stated otherwise, and the law, court practice and official fees change frequently. Check current official sources and take advice on the facts of your matter.
