POSSESSION v GOOD TITLE

Disclaimer: This is not a legal advice. It is for education

Real estate business is good and interesting but there is a lot of ignorance in the practice here in Nigeria. Everyone wishes to own a piece of land, build and have a good home. Others buy as a means of investment (land banking), but there is a lot of ignorance in the area of buying land, perfecting the title documents and taking possession. Many people buy land, keep their documents, build a house, move in and relax lockup their documents. Others buy land, keep their documents or perfect them, put up a fence or leave it bare and move on without taking possession.

This short article is meant to call the attention of property owners to the consequences of ignoring the perfection of title documents because you are in possession of the property.

We will look at this subject in four categories: Those who buy properties that have valid titles — e.g. C of O or gazetted excision in Lagos State — without Governor’s Consent. Those who buy properties from families that do not have valid title. Those who buy land, perfect title, take possession and ignore payment of government statutory dues. Those who buy land with title, fence, take no possession, and ignore government dues.

Let us examine the consequences of each group

1.Those who buy properties that have valid titles without Governor’s Consent This group of persons are the worst affected by this ignorance because they believe that since their properties have title, they can go home and sleep. As a result, most of them do not bother to go for Governor’s Consent for years. Those who buy for investment or speculation purposes wait until they sell (in breach of Section 22 of the Land Use Act) so they pass the responsibility of obtaining Governor’s Consent to the purchaser. This is what we see in practice. It is important for persons in this category to understand that any sale of land without Governor’s Consent is void ab initio. And the inherent risk is monumental.

 The Core Law: Sections 22 & 26 of Land Use Act 1978, Section 22: “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, transfer of possession, sublease or otherwise howsoever without the consent of the Governor first had and obtained. “Penalty – Section 26: “Any transaction which purports to transfer or assign a right of occupancy without consent is null and void. “Meaning that the sale itself can be declared invalid by a court. You do not legally own any property assigned from the holder of the title without Governor’s consent. We are not unaware of the situation in practice which has left many asking whether this law is practiced in breached or needs amendment. It is always the purchaser who is left with the responsibility of seeking Governor’s Consent. The seller takes his/her money and moves on while the buyer goes through the rigorous process of obtaining Governor’s Consent. However, the essence of this article is to let both buyer and seller know that the sale is void ab initio without the consent of the Governor.

The Consequences:

1. You cannot register your Deed of Assignment without Consent. You cannot use the property for mortgage with banks, nor can you sell to another person legally without the person who sold to you obtaining Governor’s Consent. All subsequent sales are void because the first sale was void ab initio.
2. The seller may dubiously resell the same property to another person with Governor’s Consent. You may lose the property to the new buyer while you face the seller with the crime of obtaining by false pretense. Your long possession here may be treated as adverse possession, meaning that you are not known to law.
3. The new buyer may go back to the original seller to seek Governor’s Consent latter and the original owner’s children (if the original owner is deceased) may refuse to sign the new deed and argue that the original sale was void.
4. The children of the person who sold to you may resell the land with Governor’s Consent and put you in contest with the new purchaser. This we have seen many times.
5. This may lead to the revocation of the assignment and title by the Governor for breach of the Land Use Act.
6. The law does not allow you to sell to a 3rd party later as the sale will be null and void.
7. If you contravene any law of the state in respect of the property and your property is marked for demolition, you have no defiance as you are not known to law.
8. You will be subject to fines and back-duties for late application of Consent, and it may become more expensive as charges and fees increase daily. Penalty for late application is up to 10% of the consent fee and interest in some states.
9. You cannot apply for building plan approval. While some people may find their way (through corruption]) to obtain approvals, anytime the issue comes up the law will compare the date of your Governor’s Consent, registration and building plan.
10. You cannot sue for trespass or other issues touching on ownership of the property as you are not known to the law concerning the property.
11. Inheritance Issues: Your children/beneficiaries will also not be able to get title without the perfection of your own title.

The Solution here is to get the seller to apply for Governor’s Consent immediately the deed is executed so the record will be at the Lands Registry or Governor’s Office as the case may be, to serve as notice to any subsequent purchaser.

2. Those who buy properties from families that do not have valid title

For this group, your case is simple. You do not own any property until the family gets government ratification in the form of C of O, Excision or any other title obtainable from the Lands Ministry of your state which must be signed by the Governor of the state or his proxy or the Minister if FCT if you are in Abuja. Long possession may be an issue in towns and villages, but government ratification is the law. And there must be Governor’s Consent for the assignment from the family to you to be valid. Once this has not been done, you do not have a property yet.

The consequences are as enumerated above, but the major problem with persons in this category is that Government may acquire the land from you without any compensation. See Section 28 of the Land Use Act.

3. Those who buy land, perfect title, take possession and ignore payment of government statutory dues: This is very dangerous. Section 28 of LUA“The Governor/Minister may revoke a statutory/customary right of occupancy for “breach of any of the terms and conditions of the right of occupancy.”

What the law takes as a breach here includes non-payment of ground rent, annual charges, or any land charge specified in your C of O/R of O. The Governor/Minister can revoke the land and it reverts to the Government, and the Governor/Minister can re-allocate it to someone else without compensation to you. However, compensation is only paid for unexhausted improvements like buildings or crops, but no compensation for the land itself.

4.Those who buy land with title, fence, but take no possession.  We have treated this in another article where it was made clear that fencing alone without other acts of possession does not constitute possession. Try and show some presence in your property, not fencing alone, because you may have other situations which could defeat your fence as possession, especially over a very long time.

Example: where you have allowed squatters to use the land for many years, or where there are other contending titles like double C of O.

In Ajero v. Ugorji 10 NWLR Pt. 621, the court held as follows: “Possession in law means the actual, physical control or occupation of land coupled with the intention to exclude others from it. It is not just casual entry or building a fence. The acts must be unequivocal, open, notorious and consistent with ownership”

Possession without Consent makes you an “occupier”, not an “owner” in law. The law treats you as an occupier if you are in possession of any property which the Governor of your state has not consented to the assignment of the land to you and the Minister of FCT in Abuja. More importantly you stand the risk of losing your property as a result of the consequences adumbrated above. Get purged of the ignorance of believing that you are in possession therefore you have the property. Give priority to perfection of title as it defeats possession without title.

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