‘Better Safe than Sorry’: Issues of Valid Title in Nigerian Real Estate Transactions


Globally, Real Estate (RE) is a most sought after capital resource; acquiring it is also one of the most profitable investments to make. RE includes: bare land (whether or not mineral-rich or having some unique attribute), or developed property which could be one or a mix of residential, commercial or industrial RE. Practically, a property is as good as the title (the legal right to a property), to such property.

In the famous case of Idundun & Ors v. Okumagba & Ors[1]   the Supreme Court (SC) per Fatayi-Williams, JSC laid down the five ways of proving title to, or ownership of land.[2] Every time a property changes hands, there is also a change in the title. Somewhere in the chain of transfers and transmissions of the property, certain lacuna could emerge with resultant defect in the title; it is important to avoid such lacunas or ensure that regularisation steps are promptly taken to avoid costly risk exposure.

It is trite that purchase is a common means of acquiring ownership of land in Nigeria, as elsewhere. To be clear, buying real property is not all about finding a vendor willing to sell and agreeing the price for the property. Buying property is ‘a big deal’, and for many people, it may be one of the most significant one-time transactions, they will ever make. The point of doing it right can never be overemphasised, and as with all major decisions, it is “better to be safe than sorry”!

On the effect of property sale without valid title, the Court of Appeal (CA) stated in Sanni-Omotosho v. Obidairo[3] per Iyizoba, JCA thus: “On the submission …that the family agreement could not bind third parties who had acquired legitimate interests in the land without prior notice, the Supreme Court held in the case of Mohammed v. Klargester (Nig) Ltd (2002) 14 NWLR (Pt. 335) 787 @ 360 para D-G (sic) that where the vendor of a property does not possess the authority to sell the property, the maxim nemo dat quod non habet will apply to nullify the sale… This Court also held in Dantata Jnr v. Mohammed (2012) 14 NWLR (Pt. 1319) 122 @ 170 C-F that ‘where a seller is shown as not having title vested in him at the time of sale, the contract of sale must be vitiated on application of the maxim nemo dat quod non habet, such contract is void ab initio.”

Using transactions in Lagos State as an example, it is critical to take certain steps prior to, during and after the purchase of land, so as to secure an unimpeachable interest in the property. This also obviates the ‘firefighting’ that could follow a flawed transaction; for example, having to pay  twice or pay double consent fees for the same property; such is a ‘loss’, if the ‘defect’ had not been earlier factored by way of ‘risk discount’ into the purchase price.

An intending purchaser must investigate (conduct searches, make enquiries, etc about) the title of the vendor and in some cases, the track record of such vendor, in order to forestall any future legal issues. In Odunukwe v. Administrator-General, East-Central State,[4] the SC, per Obaseki, JSC ruled: “If a purchaser fails to investigate title at all …, he is fixed with constructive notice of everything that he would have discovered had he investigated the whole title for the full statutory period.”

The nagging question is: how do prospective purchasers proceed with RE transactions without falling victims to fraudulent and sham vendors? This article focuses on navigating the minefields around the issues of valid title in Nigerian RE transactions; given the centrality of title as a project risk.[5]

1. Acquiring and Perfecting Title in Lagos State: Buyers’ Procedural Steps

1.1 Pre-Contract Inquiries

Things typically start with when the prospective purchaser becomes aware of the availability of the land in question through an agent, personal contacts or via any mode of advertisement. The advertisement medium, whether or not the agent is a registered professional or how well one knows the personal contact who made the introduction (and in turn, how well such person knows the vendor), could impinge on the credibility of the prospective property and its vendor.

Thus, it is only if the signals are positive, that next steps are worth exploring. Accordingly, once interested, the prospective purchaser (or his agent) reaches out to the vendor/agent for preliminary discussions or further inquiries. The vendor/agent could then provide additional information (such as price and other terms/conditions for the sale). Usually, the parties will not ‘close the deal’ at this point.

The parties can, pursuant to the prospective purchaser’s preliminary interest, then proceed to plan a physical inspection of the property; it may also be necessary to further (separately) verify relevant vendor representations and circumstances of the property from occupants of the property and/or owners of neighbouring property. Again, the intended transaction may not materialise if the prospective purchaser is not pleased with the land; for example, if it is swampy,[6] not fit for proposed use or is bigger/smaller  in size than what is actually required. However, if the prospective purchaser is happy with all his findings, they can proceed to the next stage.

An offer letter may subsequently be sent to the purchaser; the offer letter should contain details of the terms and conditions of the transaction, including the roadmap for its consummation. Vendors use it to further measure the interest of the prospective purchaser: acceptance is usually a signal that prospective purchaser (with requisite financial capacity) would be willing to conclude the deal, subject to positive findings from his investigation of title.

The imperative of pre-contract inquiries in property acquisition cannot be overemphasised; it would help determine suitability, and possibly spotlight patent defects,[7] in in the target property. It is noteworthy that the vendor is under duty to disclose latent defects only, being defects that could not be discovered on physical inspection.[8] Pre-contract inquiries may reveal obvious condition of the property (such as susceptibility to flood), boundaries, interference with other property, easement and profit apendre issues, adverse entry and/or notice, facilities and fixtures (if any), etc.

1.2 Investigation of Title

After signing the offer letter, the purchaser collects copies of title documents[9] or their details from the vendor in order to investigate title at the Lands Registry or within community/family circles, for unregistered land.[10] Amongst minefields to avoid are properties subject to litigation, to public acquisition or government owned properties (unless the latter are being disposed pursuant to due process). If the property had been excised (and allegedly no longer subject to acquisition), it is imperative that the solicitor confirms that fact as part of his due diligence (DD) – usually by reviewing the Government Gazette in addition to Lands Registry documentary records.[11]

This process has however been simplified since 2015 in Lagos State with the introduction of the ‘Land Information Management System’ (LIMS).[12] Any document extracted from LIMS at the Land Registry is admissible as evidence in court, subject to the provisions of section 24 Evidence Act.[13]  Satisfactory outcomes of the title verification exercise could then lead to signing a contract of sale.[14]

In practice, one aspect of the investigation that is often overlooked is verification at probate registry where the vendor is a beneficiary of the target property under a will. This could help with confirming authenticity of the will, whether the vendor was indeed the beneficiary of the property thereunder, and whether there is any challenge on the bequest. Thus, it is essential to ensure that the Probate (where a will exists) or Letters of Administration (in the absence of a will) was granted following due process and Assent was duly executed by the personal representatives of the deceased to properly vest the legal estate in the vendor.[15] This issue touches on vendor’s capacity to transfer valid title and should not be glossed over by the purchaser.

1.3 Contract of Sale (CoS)

The CoS documents the agreed terms of sale and purchase of the property as well as relevant background information: parties and their description,[16] root of title and nature of vendor’s title, price, mode of payment, deposit (if applicable), etc. A draft CoS may sometimes be sent whilst the purchaser is verifying the vendor’s title to ascertain its ownership and security status (whether subject to any encumbrance, and on what terms, etc). At the point where the signed CoS is exchanged, the vendor effectively holds the land in trust for the prospective purchaser till he pays (fully), and all conditions are fulfilled.[17] Thus, the purchaser acquires an equitable interest in the property while legal interest is acquired at completion.[18]

Before parties thereto can enforce the CoS, the written memorandum must exist although it need not exist at the time the contract is being made. The CoS may also include indemnity clauses –   to ensure that in case of defective title, the vendor would be liable to refund the entire purchase price, possibly plus interest at a given rate. The essence of such clauses are to adequately protect the purchaser from mischievous vendors.

1.4 Purchase Deposit

A deposit is money paid as security by the purchaser to the vendor as evidence of his intention to complete the purchase of the property pending all actions before ‘completion’, including but not limited to exchange of the executed transfer documentation. Not all vendors require payment of deposit (the purchaser may be able to negotiate such requirement away); however if paid, it may be forfeited if the depositor (the purchaser) fails in his undertaking:  Edosa v. Zaccala.[19]

The rationale for this is the principle of promissory estoppel: that the vendor might have acted or relied upon the purchaser’s intention to purchase the property.[20] If the purchaser resiles, the deposit would then serve as compensation to the vendor.  However, it is important to also protect the prospective purchaser’s interest by ensuring there is clarity around the conditions for losing the deposit. For example, there could be a timeframe within which the prospective purchaser may get his deposit back in full, irrespective of the reasons for his change of mind not to proceed with the transaction.

Refund may also be graduated on a reducing basis: the longer the period, the lower the refund entitlement, with an absolute time bar for any refund at all. Such timelines could be a function of the transactional realities. A prospective purchaser’s solicitor should be mindful of the question what is the exposure if the vendor or purchaser chooses not to proceed? The remedy of specific performance and/or damages should avail the prospective purchaser, albeit the contentious issue would be the measure of damages where specific performance was no longer feasible.[21]

Edosa distinguished between deposit and part-payment of the purchase price in that the former does not constitute any actual estate in the purchaser but only shows commitment on part of the purchaser while in the case of part-payment, even though estate may not be vested until when the balance is paid on completion, “the vendor cannot unilaterally revoke the contract and walk away unhurt”.[22] However, the deposit may be deemed as part-payment if so negotiated and agreed by the parties.  

The balance of purchase price should be paid within the stipulated time on completion; parties may also agree on whether, and what rate, interest is to be charged in the event of delayed payment. It goes without saying that the purchaser is entitled to recover the full consideration, where the CoS is terminated through no fault of the purchaser.[23]

2. Completion/Documentation Stage

At the completion or conveyance stage, the purchaser pays any balance of the sale consideration and receives original title deeds and other relevant documents together with actual or deemed physical possession of the property from the vendor. Typically, a formal deed of assignment[24] is executed in preparedness to perfect the purchaser’s title towards his obtaining legal interest thereafter. 

2.1 Deed of Assignment (DoA)

The usual practice, as endorsed by the CA in Ezeigwe v. Awudu,[25] is that after the purchaser has ascertained through his solicitor that the vendor has good title to the property to be sold, the parties prepare and execute the DoA/Conveyance.[26] The DoA is usually prepared by the vendor’s solicitor and vetted by the purchaser’s solicitor.  Upon finalisation, several copies would be produced (usually called engrossed copies) for execution by both parties, in compliance with requisite execution formalities.

In Anuku v. Standard Bank Ltd,[27] it was held that the DoA or its equivalent must at the minimum, consist of: the names and description of the parties; description of the property; the agreed purchase price; the acknowledgement of receipt of that amount, etc. It is compulsory that every DoA (or equivalent)[28] contain a consent section for the State Governor where the land/property is situated, in order to signify his consent to the transaction, pursuant to section 22 Land Use Act.[29]

Other documents such as statutory transfer forms (such as Form 1C), purchase receipt, would be executed by or on behalf of the vendor, as the case may be. Any other original documents relating to the property in the vendor’s possession should also be handed over. The key consideration is to avoid having to revert to the vendor again after deal completion. Careful attention must therefore be paid to ensuring that all documentation requirements are met including signing undated forms and obtaining copies of vendor’s tax clearance certificate (TCC) for purposes of applying for Governor’s consent.

Usually, the prospective purchaser will pay the legal fees associated with the transaction; he will pay both his and the vendor’s solicitors’ fees, in addition to also paying agency fees (‘commission’ in popular parlance), for the transaction.

3. Perfection Stage

Perfection of title includes obtaining Governor’s consent, stamping of the DoA and registration at the Lands Registry. This is a post completion matter and it is the duty of the purchaser to ensure that his title is properly perfected. Many people who are oblivious to the legal requirements have the notion that after executing the DoA or equivalent, they have done all that is required of them and can enjoy their newly acquired property without let or hindrance. The reality however is that such leaves room for issues of competing title to possibly arise in future, or the ability of the purchaser (or his estate) to use the property as security for financing may be constrained.

3.1 Governors Consent (GC)

The Land Use Act (LUA)[30] prohibits alienation of statutory right of occupancy or dealings in respect thereof, without the prior consent of the State Governor, otherwise the transaction shall be void.[31] Where the property however is subject to a customary right of occupancy, the consent required is that of the local government where the land is situate: section 6 LUA.[32] The legal consequence that arises is that no legal interest in land passes under the agreement until the necessary consent is obtained: it is thus inchoate until consent is obtained. In Awojugbagbe Light Industries Ltd v. Chinukwe & Anor,[33] the SC stated that section 22(1) LUA: “prohibits the alienation of a right of occupancy without the consent of the governor first had and obtained but does not prohibit agreement to alienate or in respect of terms and conditions for the purpose of effecting such alienation if and when the Governor gives his consent to the transaction in issue.”[34]

The advertised duration for obtaining Governor’s consent in Lagos State is thirty (30) days.[35] However in reality, bureaucratic procedures usually extend this time frame for up to twelve months or more.  Requirements for the process include: submission of duly completed Land Form 1C, together with Certified True Copy (CTC) of root of title, title deed, clear survey plan, site location sketch, site photographs, applicant’s means of identification and passport photographs, letter of authority (where application is processed on behalf of the applicant),  and covering letter.[36] Additionally, major applicable fees include: consent fee at 1.5% of assessed Fair Market Value (FMV), capital gains tax at 0.5% and stamp duty at 0.5% of assessed value.[37] 

3.2 Stamping

Stamp duties are taxes imposed on certain transactions, one of which is transfers of interest in land.After the government grants consent, the solicitor must ensure that the stamp duties charged on the transaction is paid.[38]  In order to compel compliance, stampable but unstamped documents are subject to the following: (a) they will not be accepted for registration at the Lands Registry; (b) non-admissibility as evidence in court (albeit the proceedings may be adjourned in order for the document to be stamped upon payment of penalty, before it would be tendered);[39] and (c) penalties for late registration, which is usually time based – thus, longer default attracts greater penalty.

3.3 Registration

Every instrument of transfer of interest or ownership in land is a registrable instrument under section 18, Lagos State Lands Registration Law[40] and must be registered to have the backing of law and also to have priority over any other competing instrument(s) of transfer.  Registration also facilitates investigation of title when searches are carried out at the Land Registry.[41]

Section 26(1) provides: “Any holder in possession of any registrable document shall register it within sixty (60) days after obtaining the Governor’s consent where applicable.” Registration gives an indication if a property is encumbered and any subsequent purchaser would be duly informed upon carrying out a search at the registry.

However in Registered Trustees of Obosi Development Union v. Elebor,[42] it was held that a registrable instrument that has not been registered is admissible to prove equitable interest.

Once all the foregoing steps are done and dusted, one can then rest easy and be assured of a solid title to the acquired property.[43] The above processes could take a long time and one is required to be patient as there are no short cuts to perfection of title to land and real property in general. Again, the credo is to be “better safe than sorry”!

4. Lagos State Government Schemes (LASGSs): Inter-Agency Roles and Responsibilities

There are four primary government Ministry Department and Agencies (MDAs) directly responsible for the management and design of all Lagos State Government Schemes. These agencies are: The New Towns Development Authority (NTDA), Ministry of Physical Planning and Urban Development, Land Use and Allocation Committee (LUAC) and Office of the Surveyor General of Lagos State.

Towns Development Authority (NTDA)

The Agency is responsible for establishment of New Towns and development of Schemes in Lagos State, as well as provision of infrastructure in government estates, monitoring of unauthorised developments within government estates in liaison with the Ministry of Physical Planning Development and site selection for other Government Ministries/Agencies and private developers.

Ministry of Physical Planning and Urban Development (MPPUD)

The MMUP is responsible for the overall control of developments in Lagos State; it also works with the NTDA is preparing the layout plan (consisting of different land use by zoning), for the schemes. In a typical Layout there are residential plots, commercial plots, neighbourhood garden, recreational land use and industrial use.

Land Use and Allocation Committee (LUAC)

The LUAC advises the Governor on maters connected with the management of all lands in urban areas and the resettlement of persons affected by revocation of rights of occupancy on the ground of overriding public interest. They also treat and coordinate all matters that border on land allocation and management of various existing Schemes in the State to the public; processing and issuance of CofOs and other duties as may be assigned by the Governor.[44]

Office of the State Surveyor -General

The primary function of the Office of the State Surveyor-General is to provide survey framework to facilitate the registration of CofO under the LUA. The Office is charged amongst others with the responsibility of surveying government development schemes in conjunction with the NTDA and MPPUD for the purpose of establishing new towns and development schemes, monitoring unauthorised development within government’s estates and selecting sites for government and private development.[45]

5.0 Challenges and Prospects

5.1  Perfection Challenges

According to the World Bank’s ‘Doing Business in Nigeria 2018’: “Transferring property in Nigeria requires on average 12 procedures and costs more than 15% of the property value, making the process twice as cumbersome and expensive as in the average economy in Sub-Saharan Africa.”[46] Although some progress has been made subsequently, they are not so significant yet, for citizens to say Nigeria has arrived at Eldorado regarding efficiency of RE transactions.

Notably, one of the changes that led to the improvements in Nigeria’s ranking on ‘Ease of Doing Business’ was in the area of easing RE transactions, especially on aspects of property registration.[47]  Such include Lagos State’s reforms in making property transfers easier and more transparent by removing the sworn affidavit for certified copies of the land ownership records, introducing a specific and independent complaint mechanism, and by publishing statistics on land transfers.[48]  

Although progress have been made over the past decade, they need to go farther and faster too.[49] The high cost of perfecting property transactions is still a sore issue that oftentimes discourages many parties from perfecting their property transactions.[50]

5.2 Land Grabbers

Lagos State took decisive step to deal with the issue of individuals taking possession of land illegally especially via self-help (otherwise known colloquially as ‘omo onile’ or land grabbers), vide the enactment of the Lagos Property Protection Law 2016 (LPPL). According to its long title, LPPL was enacted to “prohibit forceful entry and illegal occupation of landed property, violent and fraudulent conducts in relation to landed property in Lagos State and for connected purposes”. The actions of the ‘land grabbers’ were particularly harmful as they caused prospective purchasers to institute endless actions in court trying to recover lost monies after ‘omo oniles’ would have sold one property to multiple parties or other nefarious actions. In many cases, land conflicts lead to loss of lives, destruction of properties, and displacement of people. This menace appears to be non-abating, constantly featuring in the news.[51]

Prior to LPPL, forcibly taking over other people’s landed property was criminalised under sections 52 and 53, Lagos State Administration of Criminal Justice (Repeal and Re-Enactment) Law 2011.[52]  In 2020, the Lagos State Task Force on Land Grabbers reportedly received 1,000 petitions on forceful takeover of property, but only 350 was resolved. One instance involved the Baale (Community Head) of Aboru Town in Iyana Ipaja Lagos State crying out for government to intervene as “thugs were taking over community land and people’s property with impunity.”[53]

Despite existing legal and institutional frameworks, eradicating land grabbing remains a herculean task. While the government on its part has been strategic about fast-tracking the process of title registration and issuance of CofO by launching e-platforms,[54] it also behooves purchasers to ensure thorough due diligence and investigation of the vendor’s capacity to sell the property, before committing funds to consummate the deal.

5.3 Non-engagement of Solicitors and Other Professionals

Many RE disputes bordering on title/transfer of ownership could have been well avoided had parties hired competent solicitor(s) to support them on their RE transactions. The need to be ‘precautionary’, rather than reactionary cannot be overemphasised. It is prudent for transactors to commit their acquisition transactions to the hands of professionals: lawyers, estate surveyors and valuers, etc. Transfer of interest in real property is governed by several laws and thus, requires involvement of a competent legal practitioner to ensure legal compliance and also carry out “due diligence” by conducting searches, inspecting the property with the accompanying documents to verify authenticity and discover any defects that may render the property unfit.[55]

Parties must hire solicitors at the early stage of the deal, especially when the counterparties are not familiar persons; rather than at the imminence of some ugly development. Whilst issues may still arise where a solicitor is engaged; however, the likelihood of such would not only be minimal, there is also high probability that they would be well managed to the client’s benefit than otherwise. 

In addition, apart from the solicitor, a purchaser must ensure that all other key professionals necessary for a hitch free transaction (such as registered RE agents, valuers, estate surveyors, developers, property managers or management companies etc.) are properly engaged. It is becoming increasingly important (if not even mandatory), that professionals comprising a transaction team (especially for large scale deals), are duly registered practitioners, where registration is required by law.[56] LASRERA Law (discussed below), seeks to address some of these issues.

5.4 The Lagos State Real Estate Regulatory Authority Law 2021 (LASRERA Law)

Lagos State has also tried to further regulate RE practitioners vide provisions of the Lagos State Real Estate Regulatory Authority Law 2021 (LASRERA Law)[57] to shield investors and RE stakeholders from fraudulent RE transaction practices in the State.[58] Thus the LASRERA Board is empowered to amongst others: “ensure all [RE] activities are conducted with the propriety and in accordance with the Law and regulations made under it”; “adopt a national (sic) Code of Ethics and Responsibilities to be strictly observed by all licensed [RE] service practitioners in the State”;  coordinate intergovernmental affairs in respect of [RE]”; and “assess and fix the rate of reasonable regulatory fees” (section 5(b), (d), (e) and (f)).

LASRERA’s functions as stipulated in section 6 include, to: “formulate policies for proper dealings in [RE] transactions in the State in line with global best practices”; “recommend policies to the State Government that enhance [RE] transactions in the State”; “maintain a comprehensive and updated register of permits of [RE] service professionals; “set up monitoring teams and conduct inspections in order to ensure compliance with the Lagos State Tenancy Law, [and] the Criminal Law as it relates to transactions and other applicable legislations on [RE] transactions”; “receive and investigate petitions and complaints from members of the public”; “investigate petitions and complaints against registered persons or organisations dealing in [RE] in the State”; “collate data on property transactions in accordance with the provisions of this Law”; “ensure protection of citizens from illegal [RE] transactions”; “ensure and confirm the payment of fees, taxes and or charges on [RE] transactions as shall be imposed or charged by the Authority or any other government agency”; “periodically update the conditions for renewal or permits for persons or organisations dealing in [RE] in the State; and “do such other things as are necessary and incidental to the discharge of its functions under this Law”.

Space constrains a deeper dive into the LASRERA Law 2021. Its detailed provisions evince an intention to bring sanity into RE transactions in Lagos State, but same may also been seen as having constitutional implications that may be worthy of closer examination. For example, are the mandatory LASRERA Law registration requirements of a professional already regulated under federal statute not surplusage?[59] Can Lagos State seek to depart from the envisaged uniformity of professional services regulation across Nigeria, under federal legislation?[60] Are these akin to justifiable (additional) sectoral compliance requirements, for example start-up requirements for hospitals in Lagos State? Or will cases saying that some RE matters such as urban and regional planning are residual and therefore ultra vires the legislative competence of the Federal Government under the 1999 Constitution of the Federal Republic of Nigeria (as amended) will provide justification for LASRERA Law, if challenged?[61]  Doubtless, LASRERA compliance costs will impact transaction costs (for example, developers will pass on such costs to their prospective clients by way of higher pricing of housing units).


This article has tried to highlight how to navigate the minefields involved in purchasing property in Nigeria, using Lagos State as a case study. Given the challenges that could arise from a flawed transaction, it is imperative that the prospective purchaser ‘keep his eyes on the ball’, otherwise he may find out that he had purchased a lawsuit or paid for non-existent land, or “a castle in the clouds”. Time and again it is proven that nothing can be more unwise than to adopt a “penny wise, pound foolish” approach in RE transactions – for example, by not engaging a solicitor.

The LASRERA Law 2021 is envisaged as, and may be, a helpful addition to helping to sanitise RE transactions in Lagos State given its far-ranging provisions, and indicative intent by the LASG to robustly enforce same. It encourages use of RE professionals in RE transactions within the State. However, there may be questions about the constitutionality of some of its provisions and potential caselaw could spring up in that regard.   

Also, it is hoped that the governments across Nigeria will continue RE sector related reforms (including requisite constitutional and legislative changes) – also as a subset of improving ease of doing business in Nigeria – to ensure optimality of property transactions that will enable RE play its deserved role as a key engine of the economy, and catalyst of national development.[62]  This is moreso that it has been noted that as Africa’s largest economy, Nigeria has the potential of becoming one of the world’s RE hubs.[63]