Ivie Omoregie: Governor’s Consent & Perfecting Title to Your Landed Property
In
light of the recent devaluation of the naira, there has been a lot of emphasis
placed on PROPERTY. Many Nigerian’s in diaspora (living outside of
Nigeria…) have used this opportunity to buy the kind of property they may
have been eyeing for some time but previously unable to afford.
light of the recent devaluation of the naira, there has been a lot of emphasis
placed on PROPERTY. Many Nigerian’s in diaspora (living outside of
Nigeria…) have used this opportunity to buy the kind of property they may
have been eyeing for some time but previously unable to afford.
Effectively,
with the current value of the naira, when compared to this period 3 years ago,
any property which is bought in Nigeria right now, calculated in a foreign
currency, would be half the price that it might have previously been, or as I
like to term it “Buy 1 Get 1 Free’.
with the current value of the naira, when compared to this period 3 years ago,
any property which is bought in Nigeria right now, calculated in a foreign
currency, would be half the price that it might have previously been, or as I
like to term it “Buy 1 Get 1 Free’.
Aside
from home owners, long term tenants with lease agreements exceeding 3 years
have an obligation to register their interest, thus enabling anyone who might
wish to deal with the property, in any manner, to see their interest. I always
advise friends and relatives who take up commercial properties in which they
conduct significant renovations about the importance of having long term leases
and then registering their interest in same. As we recently saw with the
demolition of property being rented by the Nuli Juice Company in Lagos State
because of a breach perpetrated by the owner of the property, registration of interest
would have created an obligation for the relevant state authorities to notify
the registered lease hold tenants.
from home owners, long term tenants with lease agreements exceeding 3 years
have an obligation to register their interest, thus enabling anyone who might
wish to deal with the property, in any manner, to see their interest. I always
advise friends and relatives who take up commercial properties in which they
conduct significant renovations about the importance of having long term leases
and then registering their interest in same. As we recently saw with the
demolition of property being rented by the Nuli Juice Company in Lagos State
because of a breach perpetrated by the owner of the property, registration of interest
would have created an obligation for the relevant state authorities to notify
the registered lease hold tenants.
A
lot of people, possibly because of the costs involved and the fact that
fundamentally perfection of title to the property may not affect the status
quo, tend to omit, or rather not appreciate the importance of registering their
interest.
lot of people, possibly because of the costs involved and the fact that
fundamentally perfection of title to the property may not affect the status
quo, tend to omit, or rather not appreciate the importance of registering their
interest.
LANDED PROPERTY
The
importance of property in the development of any country is undeniable; many
believe it is the surest form of security, and if done right often yields
significant returns. I cannot over stress the relevance of proof of title to
property in protecting one’s interest and the degree of control a person has
over said property.
importance of property in the development of any country is undeniable; many
believe it is the surest form of security, and if done right often yields
significant returns. I cannot over stress the relevance of proof of title to
property in protecting one’s interest and the degree of control a person has
over said property.
I
am sure we have all heard of instances where an issue with proving title to a
particular property has surfaced, and there was an urgent need to establish
ownership as two or more people claimed to have conflicting interests.
am sure we have all heard of instances where an issue with proving title to a
particular property has surfaced, and there was an urgent need to establish
ownership as two or more people claimed to have conflicting interests.
Property
law in Nigeria tends to support the party who is able to “better prove” title,
thus where 2 or more parties claim to have interest in a property, the law will
tend to side with the party who has the best form of title.
law in Nigeria tends to support the party who is able to “better prove” title,
thus where 2 or more parties claim to have interest in a property, the law will
tend to side with the party who has the best form of title.
TITLE TO PROPERTY
The
Land Use Act (The “Act”) vests all title to land in the Governor of the state
in which the land is situate, who in turn holds the land on trust for the
people of that state. The Act disallows any person from claiming unlimited
interests in any land (i.e freehold interest), as all interest is subject to
the superior title of the Governor. The initial grants of statutory rights of
occupancy are for a period of 99 years; it has a striking resemblance to the
concept of lease hold interest operating in the United Kingdom.
Land Use Act (The “Act”) vests all title to land in the Governor of the state
in which the land is situate, who in turn holds the land on trust for the
people of that state. The Act disallows any person from claiming unlimited
interests in any land (i.e freehold interest), as all interest is subject to
the superior title of the Governor. The initial grants of statutory rights of
occupancy are for a period of 99 years; it has a striking resemblance to the
concept of lease hold interest operating in the United Kingdom.
For
a better understanding I would like to highlight the fact that in Nigeria the
first person to occupy a piece of land which has never been occupied by any
other person is entitled to the grant of a Certificate of Occupancy (“CofO”). This
gives that person the right to occupy that piece of land. Where this person
wishes to transfer the entirety of her/his interest or a significant part
thereof to another party, that party must obtain the consent of the Governor
before the interest can be validly transferred, (however in reality the buyer
processes and pays for perfection; aside from this allowing the buyer to
attentively pursue the application, it also forms a reassurance that due
process has indeed been followed).
a better understanding I would like to highlight the fact that in Nigeria the
first person to occupy a piece of land which has never been occupied by any
other person is entitled to the grant of a Certificate of Occupancy (“CofO”). This
gives that person the right to occupy that piece of land. Where this person
wishes to transfer the entirety of her/his interest or a significant part
thereof to another party, that party must obtain the consent of the Governor
before the interest can be validly transferred, (however in reality the buyer
processes and pays for perfection; aside from this allowing the buyer to
attentively pursue the application, it also forms a reassurance that due
process has indeed been followed).
The
best form of title an individual can have is the registration of interest in
the property with the respective land registry of the state in which the
property is situated. Registration of title serves as constructive notice to
subsequent dealers in a property that an interest in the property has been
transferred; however, does not only protect the owners’ rights, it facilitates
property purchase transactions and also enables the said piece of property to
be used as collateral for a loan.
best form of title an individual can have is the registration of interest in
the property with the respective land registry of the state in which the
property is situated. Registration of title serves as constructive notice to
subsequent dealers in a property that an interest in the property has been
transferred; however, does not only protect the owners’ rights, it facilitates
property purchase transactions and also enables the said piece of property to
be used as collateral for a loan.
To
perfect your title in land, the following three steps are required: –
perfect your title in land, the following three steps are required: –
1. Governors
Consent;
Consent;
2. Stamping –
payment of the relevant fee’s;
payment of the relevant fee’s;
3. Registration at
the respective land registry.
the respective land registry.
GOVERNORS CONSENT
The
power of the Governor to give his/her consent in certain transactions is
provided for in Section 22. of the Act and it states:
power of the Governor to give his/her consent in certain transactions is
provided for in Section 22. of the Act and it states:
“It shall not be lawful for the holder of a statutory
right of occupancy granted by the Governor to alienate his right of occupancy
or any part thereof by assignment, mortgage, and transfer of possession,
sublease or otherwise howsoever without the consent of the Governor first had
and obtained”
right of occupancy granted by the Governor to alienate his right of occupancy
or any part thereof by assignment, mortgage, and transfer of possession,
sublease or otherwise howsoever without the consent of the Governor first had
and obtained”
This
power confers on the Governor the right to consent to any of the transactions
stipulated in the Act provided that they are valid. However, if the initial
consent has been obtained fraudulently, the Governor may revoke same
immediately.
power confers on the Governor the right to consent to any of the transactions
stipulated in the Act provided that they are valid. However, if the initial
consent has been obtained fraudulently, the Governor may revoke same
immediately.
In
essence, where a property owner has a valid right to occupy a property, making
him/her the equitable interest holder of the property, when such owner decides
to resell, mortgage, grant an interest in the property for long periods of time
(3 years or more) or carry out other transactions prescribed by the Act on the
property, the consent of the Governor must be obtained as the property is held
on trust by the state government. Failure to obtain the required consent
renders the transaction null and void, thus the rights of any third party
unenforceable.
essence, where a property owner has a valid right to occupy a property, making
him/her the equitable interest holder of the property, when such owner decides
to resell, mortgage, grant an interest in the property for long periods of time
(3 years or more) or carry out other transactions prescribed by the Act on the
property, the consent of the Governor must be obtained as the property is held
on trust by the state government. Failure to obtain the required consent
renders the transaction null and void, thus the rights of any third party
unenforceable.
STAMPING
Stamping
is essentially the payment of the applicable government levies for the
transaction. The amount that is to be paid by the purchaser for the transaction
may be a fixed nominal fee or may be ad valorem, which means it would be a
percentage of the cost of the transaction, i.e the purchase price of the
property. In the case of landed property the rate at which the document is
stamped would tend to be ad valorem. Failure to stamp the transaction documents
renders the documents unacceptable for registration at the relevant land
registry as well as meaning the documents would be inadmissible as evidence in
court.
is essentially the payment of the applicable government levies for the
transaction. The amount that is to be paid by the purchaser for the transaction
may be a fixed nominal fee or may be ad valorem, which means it would be a
percentage of the cost of the transaction, i.e the purchase price of the
property. In the case of landed property the rate at which the document is
stamped would tend to be ad valorem. Failure to stamp the transaction documents
renders the documents unacceptable for registration at the relevant land
registry as well as meaning the documents would be inadmissible as evidence in
court.
CONCLUSION
One
of my uncles is the first born male in his household, thus under Benin Native
Law and Custom automatically inherited his father’s property in Benin; the
family house. He collects rent from some tenants and the family tends to use
the property for various activities; however, being as he has no intentions
what so ever of selling the property or ever residing there he has just left
it. The issue with this is that the property will never yield its full
potential if simply left there. He cannot even develop the property as a
prerequisite for most development permits is a need to attach a copy of the
title documents to the application.
of my uncles is the first born male in his household, thus under Benin Native
Law and Custom automatically inherited his father’s property in Benin; the
family house. He collects rent from some tenants and the family tends to use
the property for various activities; however, being as he has no intentions
what so ever of selling the property or ever residing there he has just left
it. The issue with this is that the property will never yield its full
potential if simply left there. He cannot even develop the property as a
prerequisite for most development permits is a need to attach a copy of the
title documents to the application.
A
lot of people understandingly avoid the entire process of perfection of title
because of want of not having to deal with government officials, and more
importantly not having to pay the extra costs attached to such perfection.
lot of people understandingly avoid the entire process of perfection of title
because of want of not having to deal with government officials, and more
importantly not having to pay the extra costs attached to such perfection.
However, I must stress that
in case of any issues with the premises, said perfection would be for your
benefit and as the perfection of title ensures the completeness and validity of
most transactions.
Ivie Omoregie is a commercial lawyer, with experience and
keen interest in projects and transactions work within the Sub Saharan African
region. Called to practice in England and Wales and Nigeria.
Ed’s Note – This article was originally posted here.