Disclaimer: This article is not a Legal advice. It is meant to provide information/education
Real estate business in Nigeria is very interesting but very complicated when one is operating without proper knowledge of the laws governing the area. The need to consult a legal practitioner of your choice and other professionals in the beginning cannot be over emphasized.
It is very unfortunate that so many people in Nigeria and other African countries do not really appreciate the need to approach a lawyer whenever they want to buy, lease or rent a property until when there is problem
Many do not know that circumstances exist that can make another person to contend ownership of their properties. That person is an innocent purchaser of same property for value without notice of your own interest.
This short article seeks to educate people on the rights of a property owner against an innocent purchaser of same property for value without notice.
Ownership of a property is defined in the celebrated case of Abraham V. Olorunfemi (1999 1 NWLR PT 163) par Nicki Tobi JCA as “the totality or bundles of rights of the owner over and above every other person”
In Nigeria the supreme court has stated that ownership of land can be proved by one of these means:
1: traditional evidence
2: production of documents duly authenticated and executed
3: acts of ownership extending over a period of time
4: Proof of ownership of adjacent land
5: acts of long possession.
Read: IDUNDUN V. OKUMAGBA (1976) 910 SC 229.
DABO V. ABDULLAHI (2005) 2 SC (PT 1) page 91
However, things are changing very fast. The most prevalent means to prove ownership of a property since the enactment of the Land Use Act 1978 in Nigeria is the production of duly authenticated and executed documents of title. This is because the Land Use Act provides that all lands in a state shall vest in the governor of that state who shall hold same in trust for the citizens and the Minister of the Federal Capital Territory for land in FCT. Section 1 of the Land Use Act 1978.
The above expressions mean that for you to claim to be the owner of a piece of land in Nigeria ,you must be ready to prove your ownership by at least one of the five means stated by the supreme court above but you are in a better position when you have duly authenticated title which include a deed of assignment duly perfected, deed of legal mortgage duly perfected, assent, court vesting order/ declaration, registered titles, deed of gift well perfected, Government allocation duly granted by the government and duly gazetted , Governor’s consent duly obtained, Certificate of ownership , R of O , excision duly gazetted depending on where you are in Nigeria.
Note: It’s always good to ask for the documents preceding these certificates for authenticity.
Now let us look at who is this Bonafide (innocent) purchaser of value without notice who could in some circumstance contend the ownership of a property with the owner.
Bonafide purchaser is the purchaser who have acted in good faith in entering the transaction by purchasing the property without any knowledge of your interest in the property. He/she must have purchased without any notice (actual, constructive or imputed) of your interest.
NOTICE means any authority which informs the intending purchaser that there is an existing interest in the property. This interest can be equitable, meaning that it has not been perfected See: Alhaja Juradat Animashaun v. G.A Olojo SC/169/1988, Karimu Ayinla v. Sifawu Sijuwola SC./26/1983 5 SC.44) at pages 76
T.A. Orasanmi v. M.O. ldowu (1959)4 F.S.C.40; [19591 S.C.N.L.R.97.
The implication here is that if the land documents are perfected it is presumed that the purchaser would have notice upon proper investigation (Search at the appropriate authorities/ government office and if you are physically in possession, the purchaser cannot say he or she did not see your presence in the property.
For a purchaser to take ownership from any other equitable or legal interest in that property, he/she must prove that he/she is a bona fide purchaser for value without notice. The conditions for this include:
The purchaser must be bonafide (acted in good faith).
Elements of Bonafide include: Value and without notice.
The purchaser must give value: It is necessary for the person who acquires the estate to give value if they are to rely on the notice rule. They need not have paid the full market value for the property. The amount paid cannot merely be nominal and would not include a gift. Value includes money and money’s worth, but also takes into account some other forms of consideration, such as services rendered, labor. Read the cases to understand what value means:
Dada v Bankole 17 NWLR pt 232 p 539, Adesanya v Adeyemi 1 NWLR pt 170 p 515, Yaro v Arewa Construction Ltd 17 NWLR pt 260 p 330
The purchaser must also prove that he/she had no notice either actual notice which comes from information you gathered from persons in possession, around the property or from other relevant sources. Constructive notice which you can get by searches at appropriate government offices and imputed notice which comes from information from your lawyers/ agents. Read the cases bello for the notices: Alhaja Juradat Animashaun v. G.A Olojo SC/169/1988 for actual notice
Karimu Ayinla v. Sifawu Sijuwola SC./26/1983, 5 SC.44 at p. 76 for constructive notice T.A. Orasanmi v. M.O. Idowu (1959) 4 F.S.C.40; S.C.N.L.R.97 for imputed notice
It must be noted that all these cases appear to lay emphasis on possession and perfected documents even if it was an equitable interest. Therefore, when a party takes possession upon the purchase of the land (not as a trespasser), it cannot be over ridden by legal estate.
Oshodi v. Balogun and Others 4 W.A.C.A. 1 at page 6 and Sulaiman and Another v. Johnson 13 W.A.C.A.213. Whether land is sold under native law and custom or merely sold without executing a formal deed, The court held and I quote. “It seems to me that if the purchaser is in possession for a long time, equitable interest thus created cannot be superseded by a subsequent legal estate. In effect, it matures into legal estate “
Now let’s look at decisions of the court either for the owner of property or for the Bonafide purchase of property for value without notice. The courts are always guided by the facts before them.
Cases for the owner include:
Ogunbiyi v. Adewunmi 5 NWLR Pt. 93 p. 215
Adedeji v. Oloso 5 NWLR Pt. 1026 p. 133
Fasoro v. Beyioku 2 NWLR Pt. 94 p. 270
In the above cases you will see that the Supreme Court laid emphasis on possession and perfection of documents.
Let’s also see where the courts held in favor of Bonafide purchaser for value without notice.
Dada v. Bankole 17 NWLR Pt. 232 p. 539, Yaro v. Arewa Construction Ltd 17 NWLR Pt. 260 p. 330, Okoya v. Santilli 4 NWLR Pt. 597 p. 539, Adesanya v. Aderemi 1 NWLR Pt. 170 p. 515
In these cases, you will see that the supreme court laid emphasis on the fact that purchaser had no notice, bought in good faith for value and perfected against the original owners.
Therefore, perfection of your property documents and possession is key factors of protecting your property from any other person. Making you the only and final owner at all times. The only problem is that perfection of property documents in Nigeria is very expensive and time consuming. In Lagos State for instance, it takes years to process C of O or Governor’s Consent. PG is calling on law makers in Nigeria to look into this area to help the growth of this industry .
Propertygroom advises you to read the above cases, as your issues are peculiar.
Let’s continue talking about it. Follow us on our social media for more information on perfection of your title documents, possession and bonafide purchase.