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| ESV. Chudi Ubosi |
According
to Olusegun Kuye – Procedure for the sale of landed properties – “a
good title must be a registerable and recognized document in law and must
possess the capacity of being a transferrable instrument of interest in landed
property”
In
the days of our fore fathers, purchase of real estate – most often land – was
quite simple.
Land
ownership was rarely vested in an individual – usually families or communities.
If an interest in purchasing part or a whole of a land was expressed, an
acceptance to sell by the vendor (family or community) was made, followed by
negotiations and subsequently an acceptance from the purchaser to buy. The
character of the purchaser was investigated before payments in cash or in kind
i.e. gifts like hot drinks and kolanuts were exchanged. The final step was the
physical handing over of possession to the new purchaser.
This
entire process always involved the head and principal members of the vendor’s
family or community. No documentation
was involved or required.
However,
same cannot be said of real estate transaction today, especially as cities
developed get more urban, with competing interests, complex relationships and
the need to clearly delineate boundaries from a personal to national and
international levels. The need for proper titles to real estate cannot
therefore be overemphasized. In Nigeria today there are different land title /
interests in land and they are briefly examined below:
1. FREEHOLD INTEREST.
The
freehold interest (or fee simple absolute in possession) is a superior interest
in land as it is perpetual, i.e for an endless period of time. The owner of
such an interest has the right to occupy, enjoy dispose of his property should
he so wish, but of course subject to government and planning limitations. This
type of interest dates back to pre the Land Use Act of 1978. The Act
effectively put an end to freehold interests as it vested ownership of all land
in the Federal and State Governments, who were now at liberty to grant
interests of up to 99 years to interested persons.
2. LEASEHOLD INTEREST.
A
leasehold interest is usually referred to as a term certain or term of years
absolute in possession. This kind of interest is usually created for a specific
period of time such as a weekly, monthly, annually or a definite number of
years. It gives the leaseholder (lessee or tenant) the right to occupy and
enjoy the property over that period of time. A rent or certain sum of money is
usually paid to the Landlord for the benefit of the use of the property. At the
end of the lease, the Landlord will be entitled to the property free of all
encumbrances – basically called the reversionary interest.
This
leasehold applies to (as mentioned earlier) to even a tenants 2 years interest
for residing in a property, as well as the 99 years interest granted a lessee
over a property by a Governor of the State. In most leasehold interests there
is an option to renew or extend the leases by applying to the Headleasse. With
the advent of the Land Use Act 1978 the grant of lease by a State Governor for
any period of time entitled one to a Certificate of Occupancy as evidence of
right over the property. For a short lease, residential commercial or others of
that nature, a simple tenancy agreement would usually suffice. This is signed
by parties to the contract.
3. PURCHASE RECEIPT.
It
is a known fact that less than 10% of the Nigerian land mass is titled and
despite the Land Use Act, a lot of people still exercise ownership over land.
Their root of title is family, community ownership, and or long time
settlement. Where an interest is acquired in land of this nature, the vesting
document is usually a family or community purchase receipt – which should pre
date the Land Use Act of 1978. With this purchase receipt the purchaser can
then apply to the State Government for a Certificate of Occupancy.
4. ASSIGNMENT.
When
a vendor (assignor) transfers all his rights in a property to a purchaser
(assignee) it is usually for the full residue of his interest or term. The
assignee is thus responsible to the Freeholder or Headlessee for satisfying
conditions imposed in the original lease. This explains why when a transactions
occurs on a property covered by a Certificate of Occupancy, the transfer
documents are regarded as a “Deed of Assignment”
5. LETTER OF ALLOCATION.
In
numerous developments undertaken by the various state governments or in
partnership with them, the vesting document is usually a Letter of Allocation
signed by the Authorities.
This
Letter of Allocation contains the address and description of the property as
well as the name of the allottee. A file is usually opened and retained where
searches can be made as well as details and all payments made on the property
can be updated. For transfer purposes this letter of allocation is usually an
acceptable vesting document.
6. JUDGEMENT OF THE COURT.
There
have been instances where ownership of a property is disputed up to the Supreme
Court and when judgement delivered, it is against the party in whom the
original title was vested vide a Certificate of Occupancy or other, registered
title. In cases such as this the new owner can use the court judgement as his
title to the property and indeed effect a sale. On the other hand, the court
judgement can be used as a basis to apply to the State Government for a
Certificate of Occupancy.
7. POWER OF ATTORNEY.
The
powers granted when an individual (donor) grants another (donee) an Attorney
over his / her property may include the power of sale. This Power of Attorney,
once it is properly registered vests upon the donee the powers to transact on
the property including transferring title and receiving consideration thereof.
CONCLUSION
The
foregoing are some of the common forms of interests in real estate in Nigeria
today.
The
most important point however, is that once these transactions are concluded,
the purchaser must seek the consent of the State Governor for his/her title to
be recognized as directed by the Land Use Act of 1978.
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