WEEK 3- GENERAL OVERVIEW AND APPLICABLE LAWS

PART A- PRELIMINARY CONSIDERATIONS

SCOPE OF PROPERTY LAW PRACTICE- land transactions and documents, wills
and administration of estates , billings and recovery of professional charges and
property law taxation

1. MEANING OF PROPERTY
In this course, property refers to
 IMMOVEABLE or REAL PROPERTY- Land or interest in land
 PERSONAL OR MOVEABLE PROPERTY (WILLS and AOE)- money, shares
copyright,etc.

SECTION 2(1) CONVEYANCING ACT (CA),1881

2. MEANING OF CONVEYANCING
Covers CREATION and TRANSFER of interest or rights in LAND
 Section 2(v), CA 1881
 Section 2(1) PCL 1959
NB- A will is not a conveyance because of its testamentary nature

3. WHY DO WE TEACH PROPERTY LAW PRACTICE?

 S- shelter
 S- status symbol
 A- Asset / investment benefit

4. ROLE OF A LAWYER IN PROPERTY TRANSACTIONS

 Advising on legal requirements
 Preparation of legal documents and instruments of transfer
 Documentation and perfection of title
 Professional responsibility to his client in conducting transactions

SECTION 22(1)D, LPA

SECTION 5,LIPA.
PART B- VARIOUS TRANSACTIONS AFFECTING LAND IN NIGERIA
1. Pledge (2) mortgage (3) lease (4) gift of land (5) donation of power of attorney (6)
sale of land (7) assignment (8) wills and assent (9) Licence.
TRANSACTION FEATURES
1. LEASE i. The landlord is the LESSOR while the tenant is
the lessee
ii). It must be up to 3 years and above
iii). It must have a certain commencement date and
duration (ie term certain)
iv). There must be certainty of parties and property.
v). The agreement must be in writing and by deed
vi) It is usually given for a consideration
vii) The lessee has exclusive possession
viii). It is only possessory interest that is transferred

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 ix) The landlord retains a reversionary interest in the
ppty.

2. POWER OF ATTORNEY i). It must be in writing

ii). Must be signed, sealed and delivered where
necessary
iii). It must be state the specific powers conferred
on the donee
iv). The Principal is the donor: The agent is the
DONEE
v). It can be revocable or irrevocable
vi). It must contain revocable or irrevocable clauses
vii). The power must be such the principal can
exercise himself
viii). It is not an instrument of transfer of title but of
delegation.
3. GIFT i). A gift of land must be voluntary
ii). It must be absolute –anyaegbunam v. osaka
iii). There must be an intention to make the gift
iv). There is no consideration
v). There must be witnesses.
vi). It must not be in writing unless it is a formal
transaction, but in order to avoid contenting the gift,
it has to be by deed
vii). It is made in views ie during the lifetime of the
parties
viii). There must be acceptance by the beneficiary.
ix). There must be delivery ACHODO V.
AKAGHA

x). A gift cannot be revoked once it is complete.

4. PLEDGE i). The borrower is the pledgor: the lender is the
PLEDGEE
ii). It is a customary transaction so need not be in
writing
iii). The interest transferred is merely possesory
iv). There must be consideration for the pledge
v). It is redeemable anyaegbunam v. Osaka
5. MORTGAGE i). The borrower is the mortgagor: the lender is the
mortgagee
ii) it must be by deed
iii). It is a security transaction
iv) there must be consideration and a collateral
v). it could be legal or equitable
vi). There is only a transfer of possession to the
mortgage
vii). There must be a duration for repayment of loan
viii). The mortgagor has the right of redemption
ix). It requires the governor’s consent
6. SALE i). The parties are the purchaser and the vendor
ii). It must be in writing
iii). There must be payment and acknowledgment of
receipt of consideration
iv). The land must be specifically delineated
v). There must be witnesses
vi). It transfers absolute title in land to the
purchaser.

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7. WILLS i). It is made by a testator to demise his ppty to
beneficiaries
ii). It must be in writing
iii). It must be signed by the testator in the presence
of two witnesses who will attest to the will
iv). There must be testamentary capacity
v). It is ambulatory ie not certain till the death of
testator
vi). It is testamentary.
vii). There must be gifts given and there must be
beneficiaries.
8. ASSENT It is an instrument executed by the personal
representative of the testator to the beneficiary in
order to transfer title to the demised ppty under a
will to the beneficiary
9. ASSIGNMENT i). It is a transfer of title in land
ii). It must be in writing and must be by deed
iii). What is transferred is the residual interest and
not the whole interest
iv). There is no reversionary interest
v). there must be covenants
vi). There must be execution
vii). It requires the Governor’s consent
viii). It must be registered.

TRANSACTIONS PARTIES PREPARATION OF

DOCUMENTS
Assignment Assignor and assignee Assignee(buyer) lawyer
Contract of sale of land Vendor and purchaser Vendors solicitor
Lease((ABOVE3 YRS) Lessor/sub lessor and Lessor(owner)solicitor
sublease/Licence lessee/sublesee and
licensor/licencee
Will Testator executors and
beneficiaries
Letter of administration Deceased and Adminstrators solicitor
adminstrators
Tenancy (3 YRS AND Land lord and tenant Landlords solicitor
BELOW)
Assent Executors and Executors solicitor
beneficiaries
Mortgage(transfer of Mortgagor(borrower)and Mortgagees solicitor
interest in land subject to mortgagee (lender)
cesser of redemption
Donation of power of Donor and donee(donee is Donors solicitor
attorney(LAND) not a party for execution
purposes)
Gift of land -
Pledge of -
land(possession)-(FOR
EXAMS- we would
distinguish it from
mortgages

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NB- EASEMENTS- NOT PART OF CURRICULUM

PART C- LAWS APPLICABLE TO LAND TRANSACTIONS, ADMINISTRATION OF

ESTATES AND PROPERTY TAXATION.
1. GENERAL APPLICABLE LAWS
 CFRN, 1999(AS AMENDED)- Sections 43 and 44
 LAND USE ACT 1978- Sections 1,5,22,28
 STAMP DUTIES ACT- (NATIONWIDE)-sections 19 and 22
 EVIDENCE ACT 2011- S.91(4),S.159,ETC
 RULES OF PROFESSIONAL CONDUCT 2007
 LEGAL PRACTIONERS ACT
EXAM TIP- These laws can be used in EVERY TRANSACTION. When identifying
land transactions for any scenario, always list this laws after listing the SPECIFIC
laws.

2. JURISDICTION SPECIFIC LAWS

 PCL 1959 (OLD WESTERN NIGERIA)
STATES- OSUN, OYO, ONDO, OGUN, EKITI, EDO, DELTA-(OOOOEED)
 CA 1881 AND 1882(NORTHERN AND EASTERN STATES)
APPLICATION- N- Northern states
E- EASTERN states EXCEPT edo and delta.
L-LAGOS-NON RTL AREAS
 RTL(LAGOS ONLY)
APPLICATION- LAGOS ISLAND, YABA, EBUTTE METTA, OSHODI, IDDO,APAPA,
SURULERE, EBUTE ERO,IDUMAGBO, VICTORIA ISLAND, IJORA, PARTS OF
MUSHIN.SHOMOLU IGBOGBI, AKOKA
QUERY- is lekki/ajah/epe under RTL
EXAM TIP- Know all the state capitals for scenarios. DO NOT CITE PCL/RTL/CA
simultaneously

3. TRANSACTION SPECIFIC/ MISCELLANEOUS LAWS

 Wills act 1837 and 1852
 AEL,LAGOS
 Illiterates protection law and act
 LIRL- s.2 (non-exhaustive list of instruments)-Ogbimi v. NCL
 LIPA
 ITMA
 PITA
 LAW REFORM CONTRACT LAW- s.5 (statute of frauds 1677)- s.4
 HCCPR(STATES)
 CGTA

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  CAMA,2004- s.166
 LPA
 MIA
 TENANCY LAW 2011
 MARRIAGE ACT
 LEGAL PRACTITIONERS (REMUNERATION, ETC) ORDER 1991
 TOWN PLANNING LAWS

EXAM TIP- memorise at least 10 applicable laws

EXAM TIP- The PARTIES, MEANS OF EFFECTING TRANSACTION,TYPE OF
TRANSACTION, NATURE AND SUBJECT MATTER determines the proper laws to
apply in a given scenario.

PART C- DOCUMENTS AFFECTING INTEREST IN LAND

 DEEDS (MORTGAGE/LEASE/ASSIGNMENT
 TENANCY AGREEMENT/CONTRACT OF SALE OF LAND
 POWER OF ATTORNEY
 STATUTORY FORMS-RTL
 PROBATE FORMS/LETTERS OF ADMINISTRATION
 ASSENT
MCQ TIP- a will does not transfer interest in land but it is a document AFFECTING
interest in land. AN ASSENT however transfers the intrest in land to the Personal
representatives.
NOTE- a land without a C of O REQUIRES A DEED OF CONVEYANCE while a
land with C OF O requires a DEED OF ASSIGNMENT.

PART D- ETHCAL ISSUES/CONSIDERATIONS

(HOW DOES THE TOPIC AFFECT YOUR ETHICAL RESPONSIBILITY IN RELATION
TO RPC.
( Lack of knowledge of appropriate law and transaction)
 RULE 1- general duty to observe all provisions in the RPC
 Advice a client according to applicable laws to a given situation- NBA V.
AKINTOKUN, RULE 15(1)
 Preparation of documents must be done diligently in line with applicable laws to it- rule
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 Lawyer must demonstrate competence and expertise in handling transactions –rule 16
 A lawyer should not advise or aid clients in violating the law.

NOTE- LIABILITY FOR PROFESSIONAL NEGLIGENCE- lawyer may be liable in

DAMAGES, REFUND OF MONETARY EXPENSES INCURRED as a result of wrong
advice- RULE 14(5), S.9,LPA.

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DISCIPLINARY MEASURES BY LPDC. Name may be struck off in severe cases.-
OLUFUNTUYI V. BARCLAYS BANK, NBA V. KOKU.

CLASS ACTIVITY- CASE STUDY 1

NO DRAFT
2- A client approaches you and tells a story about a land transaction he is interested in.
what steps should he follow?
 Interview the client
 Identify the nature of the transaction
 Identify the applicable laws
 Advise your client using counselling skills

REVISION QUESTION
Dr Salisu Nwaka Ajayi was Nigeria’s ambassador to china until 2011.He now lives in
Abuja being a senator of the FRN. He owns properties in PH, LAGOS, IBADAN and
KADUNA. He granted Maryam exclusive possession of plot 56 Alaye layout , Port
harcourt for a period of 5yrs. Because of his political inclination, he does not want direct
management of any of the properties. He therefore authorized Maryam to manage his
property at Port Harcourt and give out the said property to other persons, collect rents
from them and render accounts of rents collected ; to sell his property at 28 Byron street
,Ikoyi, Lagos and the property at Barnanwa crescent ,kaduna. Dr salisu wants to use his
property at Ibadan to secure a loan of 65 million naira from Godownlow Bank in
preparation for his bid for re-election in 2015.Being conscious of the risks involved in
Nigerian politics, he asked his solicitor to prepare a document in which he intends to
divide his properties among his children, Adaeze, Hadiza and Owen. He wants his wife
sophie and his son owen to be in charge of his estate upon his death.

ANSWER THE FOLLOWING QUESTIONS?

A- Identify and list the various transactions arising from the case study
 LEASE- (MARYAM-line 4)
 POWER OF ATTORNEY-(MARYAM-LINES 6-8)
 MORTGAGE0(Lines 9-10
 WILLS/ADMINSTRATION OF ESTATE(lines 11-12)
B- Identify and state any laws applicable to the above transactions
C- Distinguish between a Conveyance and a will
D- Identify and list any methods through which land may be acquired in Nigeria
 CUSTOMARY GRANTS OF LAND
 SALE OF LAND
 GIFT OF LAND
 CONQUEST
 FIRST/LONG SETTLEMENT
 RECLAMATION

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E Identify and mention the various property transactions and dealings with Land in
Nigeria
F - Identify and state the applicable laws to Dr Ajayi’s property in PH,LAG,KADUNA and
IBADAN RESPECTIVELY in respect of sale of same properties
 IBADAN- general laws and PCL/CAMA/MIA
 PH- CA(NB- IN PRACTICE rivers state has comparable local legislation)
 IKOYI- RTL(FORM7)
E- Would your answer in F above be different if the property in LAG is located in ikeja
ANS- YES, THE APPLICABLE LAW WOULD HAVE BEEN CA
QUERY- BAYELSA CAMPUS- argue that only LIRL WILL apply IN NON RTL STATES

F- What is the applicable law in respect of dr ajayi’s will?

G- Identify any ethical issues that may arise should you advise Dr salisu wrongly on any
of the relevant laws to the above transactions

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 WEEK 4- DEEDS
APPLICABLE LAWS- PCL, LUA, CA, RPC, LPA, CAMA, EA 2011

A- WHAT IS A DEED
A deed is a document which is in writing on a good quality paper that is signed, sealed
and delivered. This essence is for the transaction contained in the Deed to create a
binding obligation and give effect to the transfer of an interest or right in property or
confirm some act whereby an interest, right or property has already passed.

NB-LEGAL RIGHTS OR INTEREST MAY BE LAND, BUILDINGS, EASEMENTS,

LEGAL AUTHORITY, ETC.

B- TYPES OF DEEDS(3)
1. Deed poll (which is executed by only one person)- e.g-POA
2. Deed indenture (which is executed by more than one person) e.g- DOA
3. Deed supplemental- used to add/vary/substitute/remove a clause with the
CONSENT of the parties.it must recite the deed it intends to vary/amend. Comment [g1]: Q5c APRIL 1998

C- USES OF A DEED
a. To effect the conveyance of an interest or right or property in real estate
b. To create an obligation binding on a person
c. To confirm an act where an interest or property has already been passed.

D- TRANSACTIONS REQUIRING DEEDS(10)- SECTION 77(1) PCL

1. G- Gift of land- Re Vallance
2. S- Specific statutory provision(conveyance) -S.3 Real Property Act 1845
Section 77(1) PCL 1959, section 4, statute of frauds
3. T- transfer of legal interest in land
4. P- power of attorney vesting power in an attorney to execute a deed-
ABINA V. FAHART and POWELL V. LONDON PRONVICIAL BANK
5. L- lease for a term exceeding three years. –SECTION79 (1) and (2) PCL
6. V- vesting declaration where new trustees are appointed.
7. V- Voluntary surrender (A surrender where a lesser estate is given up to merge
with the greater estate in land.)
8. R- rectification of deed e.g- deed supplemental
9. M- creation of legal mortgage in CA and PCL
10. D- Discharge of motgage in CA(SUBDEMISE/ASSIGNMENT

ACRONYM- GSTPLVVRMD

E- TRANSACTIONS NOT REQUIRING DEEDS(8)

A-Assents: An assent (also described as vesting assent) is the instrument by which a
personal representative of a deceased person conveys land to the beneficiary entitled to
it.

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S-Surrender by operation of law: Surrenders by operation of law usually take effect
by implication, as for example, where a lessee accepts a new lease incompatible with
his existing lease.
L-Lease or Tenancy for a term NOT EXCEEDING three years(3 YEARS AND
BELOW)-
Re knight (1882) 21 Ch. D P. 442 at 458
Hand v Hall (1877) 2 Ex. D 355
PRINCIPLE- a lease for less than three years with a right to remain for a further three
years was only a demise years than a term less than three years with an option to
renew. As such, it was not required to be under seal.
R- Receipts not required by law to be under seal: for example, a receipt endorsed on a
mortgage serves as sufficient discharge of the mortgage.
V- Vesting orders: A vesting order is an order made by a court to create or transfer a
legal estate in land. It is made by a deed of conveyance. For example, where an
equitable mortgage exercises his power of sale, the court may make an order
vesting the land in the purchaser.
C-Conveyances taking effect by operation of law: Property vest by operation of law
in several ways such as
A- admission of a will to probate,
G- grant of letters of administration
A- Appointment of trustees in bankruptcy.
D-Disclaimer by conduct -where a trustee in bankruptcy seeks to disclaim some
property, forming part of the bankrupt's estate- SECTION 54 Bankruptcy Act
Also, where a beneficiary who is sui generis refuses a gift under a will without doing so
in writing,
W-Transactions covered by the rule in Walsh v Lonsdale: The rule is that an instrument
which is void as a conveyance because it is not a deed may still operate in equity as an
agreement for a conveyance.

ACRONYM- ASLRVCDW

ESSENTIAL ELEMENTS OF A DEED(7)

ACRONYM- SSDAEEA
1. Signing(4):

 Every document must be signed to be admissible in court- SECTION 83(4) and 94

EA 2011
 A person can not incur an obligation under a document unless he has signed it. See
S. 97 of the PCL and FARO BOTTLING CO. LTD V. OSUJI.
 If an illiterate or blind person is to sign a document, always remember to insert an
illiterate or blind jurat to be attested to by a Magistrate, Notary Public or a Legal
Practitioner. See AKINGBADE V. OLAYINKA, SECTION 91(4) EA 2011.
 If a document is to be signed by a company, always affix its common seal. See S.71
and 74 of the CAMA, SECTION 98 PCL.

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2- Sealing:
-Sealing is not necessary for an individual as that is implied.
S. 159 of the Evidence Act 2011, s.80 RTL
FIRST NATIONAL SECURITY V. JONES- a mortgage deed, was signed by the
mortgagor. The signature was across a printed circle at the end of the deed and in that
circle were printed the letters "LS" (standing for the Latin phrase Locus Sigilli meaning
place of the seal). This mortgage was held to be validly executed. STROMDALE AND
BALL V.BURDEN, CARLEN NIGERIA LTD V.UNIJOS
NOTE- FOR companies, their documents must be sealed-S.71 AND 74 of CAMA and
Containers (Nigeria) Limited v Niglasco Limited (1979) 4/CCHCJ 290 at 315
3- Delivery: (mandatory)-Anambra State Housing Corporation V.Emekwue
 Delivery is an act done to evince an intention to be bound. Jegede V Citicon Nig.
Ltd.
 May be absolute or conditional(escrow)
OLD PRACTICE-"I deliver this as my solemn act and deed".
NEW PRACTICE- any act of the party showing that the deed is intended to be binding
upon him is sufficient evidence of delivery.

Awojugbagbe v Chinukwe (1995) 4 S.C.NJ. 162.

Brossette manufacturing Nig Ltd v. M/S Olailembola
 Sometimes, delivery takes place subject to a condition, which may be expressed
or by implication, and this is known as delivery in escrow.
Dalfam (Nig.) Ltd. V Okaku Int. Ltd. (2001) 15 NWLR, Pt. 735, p. 203
Sanyima v. AIB ltd.

EXAMPLE- Thus, where a vendor executes a conveyance in advance of

completion and delivers it to his solicitor, he executes the deed subject to the
implied condition that it is not to become effective until the purchaser has paid
"the purchase price to the vendor's solicitor.
 A party CANNOT back out of a Deed delivered in escrow before the time limited for
the condition to be fulfilled. See Dalfam Nig. Ltd V. Okaku Int. Limited .
ILLUSTRATION - X sold his house to Y for four million but only 2 million was paid to X.
X decides to pass the legal interest to Y upon the payment of the balance of 2 million
within a specified date. It is only when B pays the balance that he obtains the legal
interest in the house- Beeseley v. hallywood Estates Ltd.

EXAM AREA- The doctrine of relation back will only operate when the condition is
fulfilled and the date of signing the Deed will be the effective date and not the date the
condition was fulfilled.
4. Attestation:
 Attestation is not essential to the due execution of a deed.
 EXAM AREA-However, attestation is wise as it may facilitate proof of execution
should this be necessary at a later date-

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 Section154 E.A 2011
 Any instrument executed by an illiterate grantor will not be accepted for registration.
Section 8 (1) of the "Land Instruments Registration Law"
Section… RTL.
 A deed executed outside the country for the purposes of conferring power of
attorney to execute a Deed, it should be attested by a Notary Public.
Section 118 Evidence Act.
 The company seal of a corporation must normally be affixed during execution
Article II of table "A" Pt 1 of CAMA
S.71 and 74 CAMA
S.98 P.C.L 1959.
 Attestation must be done in presence of director and secretary of a company.
Section 163 EA 2011.
5. Endorsement of Governor's Consent:
 This is required where the Deed makes a grant of state land
Section 21 and 22 LUA 1978.
 EFFECT - Failure to make provision for this in the Deed will constitute a material
omission unless there is other evidence that consent was in fact obtained-
Adedeji v NBN Ltd (1989) 1 NWLR 212 at 227.

6. Engrossment: Making of fair copies or counterparts of the original deed.

NOTE- It is not essential to the validity of a Deed but it is a way of ensuring that each of
the parties has a counterpart of the original.
7. Alterations and Erasures: These are presumed to have "been made before
execution-S.128(2) EA 2011
It is prudent to ensure that all alterations or erasure are clearly initialed by the
parties to the deed at the time of execution.
EFFECT- It varies rights and liabilities of parties and may amount to a cancellation of
such right or clause- Ottih v. Nwanekwe
8. Date Comment [g2]: REASONS WHY A DEED MAY
BE LEFT UNDATED-Q1(8) APRIL 1998
 Desirable but not mandatory in most transactions. To avoid risk of paying penalty if the deed is
 A deed is valid even if it has no date, or it has a false or impossible date- Jegede not stamped within 30 days-anuku v.standard
bank.
V Citicon Nig. Ltd, Anuku v. Standard Bank Deed is presumed to bearthd date of
execution
 Presumed to be made on date of delivery.

EXAM- a deed of lease must however be dated.

F- FORMAL PARTS OF A DEED

EXAM HINT-COMPULSORY BAR FINAL AREA(Redraft/draft clauses/ full deed)

A- INTRODUCTORY PARTS(4)
CDPR- Commencement, Date, Parties, Recitals Comment [g3]: CHIOMA DOES NOT PRAY
ROSARY
EXAM TIP- when you are asked to draft the commencement and you are not sure draft
the full introductory parts.

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 B- MAIN PART/ BODY/ OPERATIVE(7)
TCRCWPH- Testatum, Consideration Clause, Receipt Clause,Capacity clause, Words
of Grant, Parcel Clause,Habendum Comment [g4]: TUNDE COOKED RICE CAKES
WITH POWDERED HONEY
C- MISCELLANEOUS PART(3)
SIE-Undertaking for Safe Custody and production of documents, Indemnity Clause,
Exception and Reservation Clause Comment [g5]: SIMBI IS EVIL
D- CONCLUDING PART(6)
TSEAGF- Testimonium- Schedule- Execution-Attestation -Governors consent –
Franking
TOTAL- 20CLAUSES(17 mandatory and 3 optional) Comment [g6]: TUNDE SPAT EGG AT
GABBIES FACE

G- FORM AND CONTENT OF A DEED OF ASSIGNMENT

1. COMMENCEMENT
THIS DEED OF ASSIGNMENT is made the.......of.......................20...
(with a recital)
• THIS DEED OF ASSIGNMENT made the ..........of .........................20...
(without a recital)
FUNCTION: to identify the transaction
Describe nature of the transaction

2. DATE
- Effective from date of delivery.(Brosette s case)
- not be dated until ready for stamping 30/ 60 and RTL 2 Months S. 23 (3) & (4)
SDA
- In practice deeds are left undated until the purchaser has gotten Governor’s
consent and is ready to go on to stamping & registration.
- See Anuku V. Standard Bank (1972) UILR 106 for implication of undated, false
and impossible date in a deed.

3. PARTIES
BETWEEN Chief ABC of ….(the “assignor”) of the one part;
AND :
Engr. XYZ of …. (the “assignee”) of the other part.
• COMPANY

AYZ Nig. Ltd a coy registered under Part A of the Companies and Allied Matters Act,
Cap. C20 LFN 2004 with registration no. 34433 whose registered address is at No. 32
Agbani Rd. Enugu (the Vendor or Purchaser as the case may be) of the one part or the
other part.
ATTORNEY-
• Parties must be properly described (only parties or persons deriving title from
them can sue) names, address, occupation.
NOTE- What of the phrase including his representative and privies?

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 ARCHAIC. section 102 (1) PCL and Section 58 and 59 CA.S. 102 of the PCL
1959 & S. 58 (2) CA 1881 deems covenants to be made with the covenantee and
his successors in title and those deriving interest under him or her.
QUERY- What if it is by lawful attorney?

4. RECITALS
Precise and clear statements of the material facts constituting the background to
the present transaction & stated in a chronological order which explains the reasons for
the transaction-NITEL V. ROCOKONOH
TYPES-
1. Narrative or historical: States history of the title and should be limited-to facts or
matters that are necessary to explain the operative part of the deed. They should not be
lengthy. Therefore, not all intermediate dealings with the property should be stated. It is
sufficient to state the root of title and in whom it is presently vested.

2. Introductory: It indicates the purpose of the document. They recite the ownership
of the property and the intention to transfer it. They are also used to explain any
special fact or peculiarity.
NOTE-if a defect in title is mentioned in a recital, a remedy for it should also be
stated.
• Usually commenced by the word “WHEREAS” or “BACKGROUND”(use
background/RECITAL in exams)

USES/ FUNCTIONS
1. S. 162 E.A.2011 statements in a recital of a document 20 yrs old at the date of
contract are presumed to be true
2. It may be used to clear ambiguity in the operative part of a deed
NOTE- If the operative part is clear, there will be no resort to the recital.
SEE Ex parte Davies (l886)7QB.D 275 at 286, where it was held that a specific
description in the operative part of a deed is not controlled by the general
description in the recital.
EXAM - A recital cannot be used to modify clear provisions of a deed
3. It estopps parties from alleging a contrary state of affairs and is binding on the
parties- Olukoya v. Ashiru, Cumberland Court ( Brighton) v Taylor(l964)
ch.29, District Bank v Webb(l958)1 All E.R.126.. Comment [g7]: Q4(B)(I) APRIL 1998
NB- It is not every agreement that has a recital. There are some simple agreements that
need no recital. LEASES generally do not need recital except a sublease.
Exam hint- a recital can not be LESS THAN TWO CLAUSES

5. TESTATUM
“THIS DEED WITNESS AS FOLLOWS” OR
“NOW THIS DEED WITNESSES AS FOLLOWS”
FUNCTION- signifies the beginning of the covenant entered into by the partie
6. CONSIDERATION CLAUSE

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 “In consideration of the sum of Two Million Naira (N2,000,000.00) only, paid by
the Purchaser to the Vendor …”
FUNCTIONS:
1. Shows that the transaction is not a gift
2. Used as basis for the assessment of stamp duty (ad volarem)
7. RECEIPT CLAUSE
“The receipt of which the vendor acknowledges”
FUNCTION:
1. It is evidence of payment
2. Makes it unnecessary to issue a separate receipt
3. Authority to buyer to pay money to Vendor’s solicitor
4. It is sufficient notice to a subsequent purchaser for value that consideration has
passed.
Section 54 55 56 CA
Section 92,93,94 PCL

8. CAPACITY OF THE VENDOR

ALWAYS NOTE THE capacity in which the Vendor conveys e.g.
EXAMPLE- “The Vendor as beneficial owner….”, Trustees, Settlor, mortgagee,
Personal Representative etc
EXAM AREA- Implication of conveying as beneficial owner in ASSIGNMENT
Six covenants implied: SECTION 7(B) CA 1881and SECTION 100 PCL 1959
1. Right to convey
2. No encumbrance
3. Quiet enjoyment or possession
4. Further assurances assignor to protect purchaser’s title

NOTE- ADDITIONAL IMPLIED COVENANTS FOR A LEASE

1. That it is valid and subsisting
2. That the rents have been paid and covenants performed

Note: The above can be expressly excluded by the parties inserting an appropriate
clause in the deed.
9. WORDS OF GRANT
“Assigns”, “Convey” or “Transfers”
Need not use all at the same time.

FUNCTION-used to convey title

10. PARCEL CLAUSE

“ALL THAT parcel of land situated at No. 2, Agbani Road, Enugu, Enugu State,
which is more particularly described in Survey Plan No. … drawn by …. a
Licensed Surveyor and attached to this Deed.”(MAY BE DESCRIBED IN THE
SCHEDULE

14
- Property must be sufficiently described: see S. 9 of the LIR Law ( Lagos) .
A Land registry can refuse registration of a land instrument without a survey plan- Comment [g8]: Q4b ii April1998

EXAM FOCUS-(EXCEPTIONS)
 Where the present instrument relies on a previous instrument registered with a
survey plan- Amadi v. Orisakwe
 Where the present instrument fully describes the land to the satisfaction of the
registrar
 Where the land is in the registration district with all the particulars.
11. HABENDUM
Describes the estate given by the Vendor , the extent of ownership granted e.g.:
“TO HOLD unto the Purchaser for all the unexpired residue of the term of years in the
C.of O. …”

12. EXCEPTIONS AND RESERVATIONS

Exceptions; refers to whatever is withheld from the purchaser in the grant by the
vendoR ( existing rights) while Reservations are new rights created by the parties which
are beneficial to the vendor

13. INDEMNITY CLAUSE

An undertaking by the purchaser to pay the rent and observe all covenants and
conditions running with the land or property. A Purchaser undertakes to
indemnify the vendor in the event of a breach of the above covenants and
conditions.A vendor may also undertake to indemnify the purchaser for any
defect that may arise in respect of his title

14. SAFE CUSTODY AND ACKNOWLEDGEMENT FOR PRODUCTION OF

DOCUMENTS
 CAN the assignor keep the original title documents?
ANS-YES. This can happen when all the interest in the property has not been
transferred to the assignee.
 What ways can the assignee s interest be protected?
This can be done in THREE ways.
1. Making and undertaking to keep the original title documents in safe custody.
2. Acknowledgement of right of the assignee to the production of the original title
document.
3. Endorsement in writing on the face of the original title document that a part of the
land has been transferred to the assignee to put a third party on notice.

15. TESTIMONUIM
“IN WITNESS OF WHICH the parties have executed this deed in the manner
below the day and year first above written”.

16. SCHEDULES

15
 Used to record detailed information e.g. survey plan, tables or inventory of items
transferred under the deed.
NOTE- assuming the man has sold the property including other moveable items,
it is usually reflected in contract of sale and not the deed.

17. EXECUTION AND ATTESTATION CLAUSE

Refers to the application of signature, mark, thumb print etc, of the parties
A-INDIVIDUAL
“SIGNED, SEALED and DELIVERED
by the ‘assignor’
_____________
Chief ABC
“SIGNED, SEALED and DELIVERED
by the ‘assignee’ _________”
Chief XYZ
B- COMPANY
THE COMMON SEAL OF ABZ (NIG.) LIMITED is affixed to this deed and the deed was
duly delivered in the presence of:
----------------- -------------------
DIRECTOR SECRETARY

C- IIITERATE /FOREIGNER(NON ENGLISH SPEAKER)

• SIGNED, SEALED and DELIVERED
by (the illiterate / blind)
The content of this deed having been first read and interpreted by me (name of
Interpreter) from English language to ibo language and he appeared perfectly to
understand same before affixing his thumb print
NOTE-S.8(9)RTL
---------------------
(THE ILLITERATE / BLIND)

BEFORE ME
_________________
MAGISTRATE / NOTARY PUBLIC

Note – for a blind person use READ ALOUD/ FOR DEAF AND DUMB USE sign
language by a sign language instructor. for Foreigner, it should be attested to before a
notary public.
Note- the manner for drafting depends on the

D- ATTORNEY

16
 Signed sealed and delivered by the assignor through his
attorney__________________by virtue of a POA dated _______and registered in
No_________at page_________volume_ at the Enugu state land registry. Note (FCT-
ABUJA GEOGRAPHIC INFORMATION SYSTEM)
“IN THE PRESENCE OF:”
NAME:…………………………………..
ADDRESS:……………………………..
…………………………………………….

OCCUPATION:……………………….
SIGNATURE:…………………….(2 witnesses)
NOTE-add L.S at the end of the line (see probate forms for specimen)

18. CONSENT
• “I CONSENT TO THE ABOVE TRANSACTION
THIS …… DAY OF ……………….… 20 ….”
________________________________
EXECUTIVE GOVERNOR, ENUGU STATE

19. FRANKING
• Provides for the name and address of the Solicitor who prepared the instrument:
Advantages of franking
• 1. To avoid the effect of the Illiterate Protection Act or Law as a duly franked
document is not invalidated by the absence of the Illiterate Jurat. SAKA
BRAIMOH VS. MRS. KARIMU;S.5 IPL
• 2. The Commissioner for Stamp Duties may not accept a document if it is not
endorsed – EDOKPOLO & CO. VS. OHENHEN

PERFECTION OF A DEED OF ASSIGNMENT

This involves the following:
1. Obtaining the Governor’s consent, S. 22(2) of the Land Use Act
2. Stamping the Deed of assignment
3. Registration

Acronym: CSR-consent, stamping and Registration.

THE EFFECT OF FAILURE TO PERFECT TITLE TO PROPERTY

This will be discussed based on the various aspect of perfecting title.
Failure to obtain the Governor’s consent as regards land in a State or the Minister’s
consent when dealing with land in Abuja.
1.It makes the legal transfer of interest to be void
2.Makes the interest equitable or inchoate, - SAVANAH BANK V. AJILO •

17
EFFECT OF FAILURE TO STAMP THE AGREEMENT
1. It will not be admissible in evidence
2. In Lagos, a failure to stamp after 60 days of the execution will make it void
3. Penalty will be paid as fine for late stamping

EFFECT OF FAILURE TO REGISTER IT

1. It is not admissible in evidence
2. The interested party will not have priority over the land
3. It will only vest equitable interest in the owner

THE PARTICULARS OF INSTRUCTIONS NEEDED TO DRAFT A DEED OF

ASSIGNMENT ARE:
1. The particulars of the parties
2. The particulars of witnesses
3. Description and location of the property
4. The history of the title to the land( abstract)
5. Consideration
6. Covenants and undertakings
7. Capacity of the Assignor
8. The quantum of interest given by the Assignor (Habendum)

POINTS TO NOTE
 Understand the different parts a deed because u may be asked to draft the
introductory part or operative part or miscellaneous parts or concluding part of a
deed .we could draft a full deed(last two years past questions)

NOTE- NO EXAM IN PROPERTY WITHOUT OUR BEEN ASKED TO DRAFT A DEED

NOTE- If a property to be transferred is covered by C OF O- DEED OF

ASSIGNMENT / SUB LEASE. If PPTY is not covered by C of O= DEED OF
CONVEYANCE

PRACTICE EXERCISES- SEE CLASS ACTIVITIES NOTE BOOK

DO DIFFERENT VARIATIONS OF DEEDS.
THIS DEED OF ASSIGNMENT is made the ……………… day of ……………………
BETWEEN Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos (‘The Assignor’) on
the one part
AND
Professor Ugo Ekanem of 15 Straight Road Sapale Delta State (‘The Assignee’) on the
other part.
WHEREAS:
1. The Assignor is the legal owner of a Certificate of Occupancy No. 59/59/2010A
over a parcel of land with four blocks of flat situate at 15 Sapele Road, Sapele
Delta State.

18
2. The Assignor is willing to alienate her interest while the Assignee is willing to buy
subject to the conditions to be stated herein.

NOW THIS DEED WITNESSES AS FOLLOWS:

In consideration of the sum of thirty million naira (N30, 000, 000.00) now PAID to the
Assignor by the Assignee (the Receipt of which the Assignor hereby acknowledges),
the Assignor as a BENEFICIAL OWNER ASSIGNS ALL THAT parcel of Land with four
blocks of flat situate at No. 15 Sapele Road , Sapele Delta State covered by a
Certificate of Occupancy No. 59/59/2010A and more rightly described in the Survey
plan to be prepared by a licensed Surveyor attached to the Schedule with all rights
easements and appurtenances

TO HOLD unto the Assignee as holder of a Statutory right of Occupancy for the term
unexpired on the Certificate of Occupancy.

IN WITNESS OF WHICH the parties have executed this Deed in the manner below the
day and year first above written.
Or if it is an individual and a corporate body that are the parties, then it may be like this:

IN WITNESS OF WHICH the Assignor has signed this Deed and the Assignee (a
company) has caused its common seal to be affixed in the manner below the day and
year first above written.)

SCHEDULE
1. Survey Plan

SIGNED, SEALED AND DELIVERED,

By the Assignor
…………………………
Mrs. Aduke Thoma

IN THE PRESENCE OF:

Name:
Address:
Occupation:
Signature:
Date:

SIGNED, SEALED AND DELIVERED

By the Assignee
…………………….
Prof. Ugo Ekanem
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date:

I CONSENT TO THIS TRANSACTION

………………………………
DATED THE ….…DAY OF …………….
EXECUTE

19
2. Deed of Assignment where a party is an illiterate/
blind person
THIS DEED OF ASSIGNMENT is made the ……………… day of April 2012
BETWEEN Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos (‘The Assignor’) on
the one part
AND
Zenith Bank Plc a body corporate dully incorporated under the Laws of Nigeria with its
registered office address at 10 Bugo Street Victoria Island Lagos (‘The Assignee’) on
the other part.

WHEREAS:
1. The Assignor is the legal owner of a Certificate of Occupancy No. 59/59/2010A over
a parcel of land with four blocks of flat situate at 15 Sapele Road, Sapele Delta
State.
2. The Assignor is willing to alienate her interest while the Assignee is willing to buy
subject to the conditions to be stated herein.

NOW THIS DEED WITNESSES AS FOLLOWS:

In consideration of the sum of thirty million naira(N30, 000, 000.00) now PAID to the
Assignor by the Assignee (the Receipt of which the Assignor hereby acknowledges),
the Assignor as a BENEFICIAL OWNER ASSIGNS ALL THAT parcel of Land with four
blocks of flat situate at No. 15 Sapele Road , Sapele Delta State covered by a
Certificate of Occupancy No. 59/59/2010A and more rightly described in the Survey
plan to be prepared by a licensed Surveyor attached to the Schedule with all rights
easements and appurtenances TO HOLD unto the Assignee as holder of a Statutory
right of Occupancy for the term unexpired on the Certificate of Occupancy.

IN WITNESS OF WHICH, the parties have executed this Deed in the manner below the
day and year first above written.
SCHEDULE
1. Survey Plan

SIGNED, SEALED AND DELIVERED,

By the Assignor
…………………………
Mrs. Aduke Thomas
The contents of this Deed having been first read and interpreted (aloud if Blind) to her
From English language to Yoruba Language by me Adamu Ebuka of No. 15 Broad
Street Lagos when she appeared perfectly to have understood same before affixing her
thumbprint.
BEFORE ME

MAGISTRATE/ NOTARY PUBLIC

The common seal of Zenith Bank Plc (The Assignee) was affixed to this Deed on the
…..day of April 2012 and was dully delivered in the presence of:
………………. …………………….
Director Secretary

20
 I CONSENT TO THIS TRANSACTION
………………………………
DATED THE …DAY OF APRIL 2012
GOVERNOR OF DELTA STATE

DEED OF ASSIGNMENT BY ATTORNEY.

THIS DEED OF ASSIGNMENT is made the ……………… day of April 2012
BETWEEN Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos (through her Lawful
Attorney Samuel Abubakarof 10 Base Road Ikeja Lagos) (‘The Assignor’) on the one
part AND Professor Ugo Ekanem of No. 15 Straight Road Sapale Delta State (‘The
Assignee’) on the other part.

WHEREAS:
1. The Assignor is the legal owner of a Certificate of Occupancy No. 59/59/2010A over
a parcel of land with a four blocks of flat situate at 15 Sapele Road, Sapele Delta
State.
2. The Assignor is willing to alienate her interest while the Assignee is willing to buy
subject to the conditions to be stated herein.
3.
NOW THIS DEED WITNESSES AS FOLLOWS:
In consideration of the sum of thirty million naira(N30, 000, 000.00) now PAID to the
Assignor by the Assignee( the Receipt of which the Assignor hereby acknowledges),
the Assignor as a BENEFICIAL OWNER ASSIGNS ALL THAT parcel of Land with four
blocks of flat situate at No. 15 Sapele Road , Sapele Delta State covered by a
Certificate of Occupancy No. 59/59/2010A and more rightly described in the Survey
plan to be prepared by a licensed Surveyor attached to the Schedule with all rights
easements and appurtenances TO HOLD unto the Assignee as holder of a Statutory
right of Occupancy for the term unexpired on the Certificate of Occupancy.
IN WITNESS OF WHICH the Assignor has through her lawful Attorney has set his hand
and the Assignee has executed this Deed in the manner below the day and year first
above written.

SCHEDULE
2. Survey Plan
SIGNED, SEALED AND DELIVERED,
By the Assignor
…………………………
Mrs. Aduke Thomas
Through her true and lawful Attorney Mr. Samuel Abubakar by virtue of a Power of Attorney dated the …..
day of February 2011 and registered as 10/23/2011A at the Lands Registry Lagos State.
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date:
SIGNED, SEALED AND DELIVERED
By the Assignee
…………………….
Prof. Ugo Ekanem IN
THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date:
I CONSENT TO THIS TRANSACTION
………………………………
DATED THE ….…DAY OF…………………..
GOVERNOR OF DELTA STATE

21
 WEEK 5 -POWER OF ATTORNEY
APPLICABLE LAWS-
MEANING- Power of Attorney is a document usually but not always necessarily under
seal whereby a person seized of an estate in land authorizes another person (the
donee) who is called his attorney to do in the stead of the donor anything which the
donor can do, lawfully usually clearly spelt out in the Power of Attorney – UDE v.
NWARA

PARTIES TO A POWER OF ATTORNEY TRANSACTION

The person who donates the power is called the ‘donor’ (Principal) while the person to
whom the power is donated is called the ‘Donee’ (Attorney).

USES OF POA
1. Remedial device for legal mortgage by sub demise in CA
2. buying and selling land on behalf of the Donor;
3. collecting money on behalf of the donor;
4. prosecuting cases in court;
5. receiving rates, rents, profit a prendre -UDE VS. NWARA

FORM OF A POA
Usually, a Power of Attorney is made in a Deed poll (a Deed made by one party)
EXCEPT in the following instances it is advisable to be made in Deed Indenture (a
Deed made by two or more parties):
1. When it imposes some obligations on the Donee
2. It is important to have a record of the Donee’s signature to prevent fraud
3. It is supported by a consideration
4. It is coupled with an interest and so it is desirable to be signed by both parties

EXECUTION OF POA
1. Where POA is empowered to execute a deed,it must be by deed-ABINA V.
FARHAT;POWELL V.LONDON PROVINCIAL BANK
2. Where executed outside Nigeria must be attested to by a notary public-HUTCHEON
V. MANNINGTON;AYIWOH V.AKOREDE.
3. Where donor is illiterate or blind; there must be illiterate jurat-EZEIGWE V. AWUDU

CIRCUMSTANCES REQUIRING POWER OF ATTORNEY

A Power of Attorney is not mandatory in land transaction. However, circumstances may
require a power of Attorney viz
a) Unavailability of the donor-EZEIGWE V.AWUDU;CHIME V.CHIME
b) Physical impairment
c) The need to involve an expert eg lawyers by virtue of their knowledge of the law.
d) Where donee is empowered to execute a deed or transfer interest in land
e) Used to secure purchaser’s interest pending perfection of title of purchaser.

22
f) Where mortgage is by demise/sub demise under CA pending payment of mortgage
sum
CAPACITY OF THE PARTIES
 A person may appoint an attorney to carry out on his behalf only acts, that he may
himself lawfully do. Comment [g9]: this is in contrast to
‘agency’ where the principal can appoint a
 The appointment of an Attorney cannot be used to cure a disability suffered by the lunatic or insane person to be his agent.
Donor.
 Therefore the Donor must be legally capable of doing that which he appoints another
to do on his behalf. Note: infant, bankrupt, unincorporated entity, insane
 Only a juristic person capable of suing and being sued can be appointed a Donee of
a power of attorney.
 . a business name or unincorporated body/Association or an Office cannot be
appointed as they all lack the legal capacity NBN LTD. V. KORBAN
BROTHERS;UDE VS. NWARA CHIME VS. CHIME
 Where Power of Attorney is conferred on more than one person, the instrument must
specify how the attorneys will sign, e.g.: together or by some other specified way.

POWER OF ATTORNEY OVER FAMILY PROPERTY

 It must be executed by the head of the family as one of the donors; otherwise it is
VOID-AJAMOGUN V. OSHURINDE .
 Where a POA is given in relation to family property, then a ‘Recital’ must be included
in the actual PA to depict that consent of principal members of the family was obtained

MODE OF CREATION OF POA

The mode of creating a power of Attorney depends on the purpose of that Power of
Attorney.
Melwani v Five Star Limited
a) Where the power of Attorney has to do with land, it must be in writing to comply
with section 4 Statutes of Fraud 1677.
b) Where the done is authorized to execute a deed, the instrument authorizing him
must be a deed. Abina v Farhat; Powell v London & Provincial Bank. Comment [g10]: POA FOR DEED OF LEASE
DONE VERBALLY

VALIDITY OF A POWER OF ATTORNEY

1. For the power of Attorney to be valid, both the donee and donor must be a legal
person. National Bank v Korban Brothers Nig) Ltd & Ors.
Thus, A person under any legal disability cannot donate or be appointed a donee of a
Power of Attorney eg a lunatic, infant, bankrupt etc.
Note-married women can donate or be a donee regardless of whether she is an infant
or not-s.146 PCL
2. If the authority relates to land, the donor must be the owner of the land.
3. The donor must have the capacity to carry out the act which he authorizes
another. Thus, the appointment of an agent cannot be used to cure disability
suffered by the Principal – AJUWON V ADEOTI.

23
 FEATURES OF POWER OF ATTORNEY
1. It is a document in writing. It cannot be given orally - ABINA V FARHAT
2. It is an instrument of delegation -UDE V NWARA ; CHIME V. CHIME
3. It does not alienate or transfer interest in Land – AMADI V NSIRIM EZEIGWE V
AWUDU
4. A Power of Attorney must be in writing but need not to be by deed. However, where
the Power of Attorney is given to do execute a deed it must be by deed.
5. It must be given by a person with legal capacity to another with legal capacity.
6. It requires a fixed rate of stamping. But usually the Registry assesses the document,
per value of the consideration offered.(land)
7. Power of attorney is usually a special instrument in the form of a Deed Poll, that is,
an instrument that is executed by only one party
8. A Power of Attorney may be revocable or irrevocable.
9. Where it is given for valuable consideration or coupled with an interest, it cannot be
revoked by the donor without the concurrence of the donee until the interest for
which it is granted is exhausted.
10. It does not require consent provision, since it does not transfer interest in land.

CONSTRUCTION OF A POWER OF ATTORNEY

 A Power of Attorney is construed strictly and exhaustively as any extrinsic
evidence cannot be admitted to establish additional powers given to the Donee
not stated in the power of attorney. RE BRYANT.
 Thus, oral evidence would not be admitted to contradict the powers expressly
given in a PA-NBA v Iteogu
 In a Power of Attorney, the general power clause does not confer any additional
power to the Donee so a solicitor must exhaustively list out the Donee’s powers
and without ambiguity. ABINA V. FAHART
 the Power of Attorney must be drawn in a form that will ensure that no difficulty
is experienced when dealing with third parties. JACOBS VS. MORRIS

TYPES OF POWER OF ATTORNEY

1. EXTENT OF AUTHORITY
a. GENERAL POWER OF ATTORNEY is where the powers are broadly stated to cover
issues pertaining to the subject matter.
b. SPECIFIC POWER OF ATTORNEY is where the power is given in respect of
partner’s act to be done by the donee of the power eg to let premises to tenant and
collect rent.

2. EASE OF REVOCABILITY
a. REVOCABLE POWER OF ATTORNEY is one that can be revoked bat anytime and
for any reason as long as the donee has not exercised the power.
b. IRREVOCABLE POWER OF ATTORNEY is one which is given for a consideration
and also coupled with interest.

24
 3. LENGTH OF TIME
FIXED POA- for a fixed period not exceeding twelve months within which the PA
cannot be revoked.

REVOCATION OF POWER OF ATTORNEY

This occurs when the Donor does not want the Donee to act for him any longer
 The form of appointment of a Donee determines the form to be used in revoking
it or that one higher in form compared to that used can be used for the revocation
otherwise any such revocation will be invalid.
 For instance a Donee appointed by a Deed can only be removed by a Deed and
not a mere letter. OJUGBELE V. OLASOJI.
 A Donee appointed by a letter can be revoked by a Deed which is a form higher
than the mode of his appointment.

TYPES/FORMS OR REVOCATION
1. Express Revocation
2. Implied Revocation
3. Revocation By Operation of Law

(1) EXPRESS REVOCATION

Power of Attorney is a special form of agency; some rules of agency therefore apply.
Accordingly, in keeping with the rule that he who hires reserves the right to fire, the
Donor can expressly fire/remove the Donee or revoke the power.

However, if the appointment is by deed, the power must be revoked by deed to be valid.
ADEGBOKUN Vs. AKINSANYA; OJUGBELE V. OLASOJI

(2) IMPLIED REVOCATION

 This occurs where the Donor after giving a Power of Attorney to a Donee, still
goes ahead and deals with the subject matter of the POA in such a manner that
makes it impossible for the Donee to effect his authority under the Power.
 The fact that a donor gave a Power of Attorney does not mean that the Donor
cannot himself do the act-.CHIME V. CHIME.
(3) REVOCATION BY OPERATION OF LAW
 Power of Attorney is deemed revoked by operation of law if the Donor suffers
death, insanity, bankruptcy or other legal incapacity during the subsistence of the
power
ABINA VS. FARHAT;UBA VS. REGISTRAR OF TITLES
 An EXCEPTION is where the power is coupled with interest or it is faced for a period
of time, the death, lunacy or bankruptcy of the donor will not affect the power.

25
 Note also that power of attorney can be invalidated if fraud, duress or undue influence is
established. (whether or not valuable consideration has been furnished)-AGBO V.
NWIKOLO

IRREVOCABILITY OF POWER OF ATTORNEY

Following legal difficulties and hardships usually associated with revocation by
operation of law,
These two exceptions are found in the Conveyancing Act (CA), 1882 and the
Property & Conveyancing Law (P&CL), 1959. They are as follows:
(1) Where the Power of Attorney is given for valuable consideration/ coupled with a
grant/ with an interest.
 Where Power of Attorney is given for valuable consideration and in the
instrument creating the power, the power is expressed to be irrevocable that Comment [g11]: NOTE THE
FOLLOWING
power shall not be revoked by the donor without the consent of the Donee 1.-Even where the donor gave it for a longer
Section 8 (1) of the Conveyancing Act (CA), 1882 period of 12 MONTHS, the period of
irrevocability will still be read AS 12 MONTHS
Section 143 (1) of the P & CL, 1959. since it was given without any consideration.
2.In the above instance, to revoke a Power of
UBA V. REGISTRAR OF TITLES. Attorney must be with the consent of the
 Death, disability or bankruptcy of the donor cannot revoke the power of attorney Donee.
3. If the donor dies, it will not affect the
in this instance--LABABEDI Vs. ODULANA Donee’s powers to bind the donor for the
period of time stated in the Power of
 Where the Power of Attorney is coupled with an interest, it is irrevocable until the Attorney. - S. 143 &144 of the PCL and S. 8 &
interest is exhausted 9 of the CA; -LABABEDI Vs. ODULANA

(2) Where the power of attorney is stated to be irrevocable for a fixed term not
exceeding 12 months
A Power of Attorney expressed to be irrevocable for a fixed period, not exceeding one
year, remains irrevocable for the period so expressed, whether or not it is given for
valuable consideration
Section 9 (1) of the C A, 1882
Section 144(1) of the P & CL, 1959.

PROTECTION OF THIRD PARTIES ON THE REVOCATION OF A POWER OF

ATTORNEY-S.9 & 10 CA;71 CA Ss 142, 143 PCL
A third party who had acted with the Donee based on a Power of Attorney which later
was revoked is protected by Law on the following
1. Where the third party is a bona fide purchaser for value without notice of the
revocation of the owner, he cannot lose interest.
The donor thus can only sue the Donee in damages for unlawful exercise of
power.
2. Where a person had knowledge of the revocation, but went ahead to acquire – he
has no protection.
3. Where though the 3rd party had knowledge of the revocation but however obtains a
statutory declaration from the donee that he has not received any official
communication of the revocation, then the third party is protected. However, the
statutory declaration must be done WITHIN 3 MONTHS.

26
 DISTINCTION BETWEEN POWER OF ATTORNEY AND A CONVEYANCE
S/N POWER OF ATTORNEY CONVEYANCE
1 Donor and done as the parties Vendor and Purchaser
2 Does not transfer interest in land Transfers interest or title in
land
3 Governors consent is not required (except in Requirement of governor’s
Lagos where it is required) consent is mandatory SS.
21 & 22 Land Use Act
4 Usually executed by one party thus a deed pole Usually executed by both
parties thus a deed
indenture
5 It is an instrument of delegation It is an instrument of
transfer
6 No special mode of creation A conveyance must be by
deed
7 It need not contain a recital Must contain a recital
8 May or may not be revocable A conveyance is not
revocable except if
delivered in escrow and
the condition could not be
fulfilled.
9 A power of Attorney may be executed in A conveyance must be for
respect of any subject matter interest in land.
10 The donee cannot sue in his own name but in Any cause of action can be
the name of the donor Melwani v Five Stars instituted in the name o the
Ltd. parties

DIFFERENCES BETWEEN POWER OF ATTORNEY AND CONTRACT OF SALE OF

LAND
POWER OF ATTORNEY CONTRACT OF SALE OF
LAND
1 Does not transfer interest in land Transfers equitable interest
in land
2 Usually executed by one party Usually executed by both
parties
3 PA does not always require consideration Requires consideration to
be valid
4 Must not be exchanged between the parties It must be exchanged
between the parties to be
valid
5 Does not necessarily attract stamp duty but Attracts a stamp duty (ad
attracts a fixed duty valorem) S. 28 Stamp
Duties Act

27
 PARTICULARS OF INFORMATION/INSTRUCTIONS REQUIRED TO PREPARE A
POWER OF ATTORNEY
 Name & address of the Donor
 Name & address of the Donee
 Purpose of the Power of Attorney(i.e., the powers to be given)
 Whether or not it is given for valuable consideration, and if yes, what is the
Consideration.
 Whether or not is shall be expressed to be irrevocable and the duration of
irrevocability

FORM & CONTENT OF A POWER OF ATTORNEY

1.COMMENCEMENT

► In the olden days, a Power of Attorney may be commenced with the words:
“KNOW YE ALL MEN BY THESE PRESENTS”
The modern practice is that it is commenced with:
BY THIS POWER OF ATTORNEY”.
Or
“THIS POWER OF ATTORNEY”.

(2) DATE
“given this……day of……………, 2014

Or

“made the ……. day of ………., 2014

(3) RECITAL
► Recital is rarely found in a Power of Attorney.
It is necessary only where the Donor seeks to show that he has the consent of other
principal members of the family to give the Power of Attorney

FUNCTION-Recit Recital may be useful in the interpretation of a document though not

normally taken into consideration when construing the document.

(4) APPOINTMENT CLAUSE

This is the clause appointing the Donee.

► Appointment Clause in a power of attorney is for identification purpose only. A
power of attorney being the delegation of power is not an agreement between one
person and the other. Rather it provides for the appointment clause, for example:

28
 “I, Alhaji Abu Bango of 10, Abuja Close, Ikeja, Lagos, HEREBY appoint Mr. Eze
Okoro to be my true and lawful Attorney and in my name and on my behalf to do all
or any of the following acts or things namely:

(4) POWER/AUTHORITY CLAUSE

► This is a statement/list of the acts to be performed by the Donee on behalf of the

Donor.

► It should be very clear and exhaustive.

You must be meticulous in presenting your intentions because, as already stated, the
powers conferred on the attorney are construed strictly

► The clause usually ends with an omnibus expression thus:

“AND I ALSO DECLARE that my attorney may do all other things as I may
lawfully do.”
Or
“AND to do all things necessary and incidental to the matters above as I may
lawfully do.”

► Note that the inclusion of this does not introduce any powers beyond what is
enumerated: ABINA VS. FARHART (supra)

(5) IRREVOCABILITY CLAUSE

► To take the benefit of the statutory protection of third parties which has
already been discussed, it is important that a clause should be inserted to the effect
that:

“AND IT IS DECLARED that in consideration of the sum of N50,000.00 (fifty

thousand Naira) only paid to the Donor by the Donee (the receipt of which the Donor
hereby acknowledges) this Power of Attorney shall be irrevocable for a period of
…….. months/years from this date.

Or

“AND I DECLARE that this Power of Attorney shall be irrevocable for a period of
twelve months from this date.

(6) TESTIMONIUNM

► Is couched thus:

29
“IN WITNESS OF WHICH the Donor has executed this power of attorney in the
manner below the date and year first above written.”

► Note that unlike other conveyancing documents, such as assignment, lease and
mortgage, the language of power of attorney is in the singular. This is because often
times, only the donor executes it, hence it is called a Deed poll i.e.

“IN WITNESS OF WHICH I the said (name of donor) have executed this
Power of Attorney the day and year first above written.

(7) EXECUTION

“SIGNED, SEALED AND DELIVERED by…….................(Name of the Donor).

► This should be done in the name of the donor.

(8) EXECUTION OF DEED (Deed of Assignment, Lease, Mortgage, etc) BY AN

ATTORNEY

► The Donee may execute in the Donor’s name or in his own name, except
where statute requires execution in the name of the estate owner section 9(5) of
the PCL Section 141 of the P & CL.

► Section 141(2) of the P & CL provides that statutory direction may be given for
execution in the name of the estate owner.

► In such cases where Deed is executed by an attorney in his own name and
on behalf of a Donor, the Donee executes the deed of conveyance on the
Donor’s behalf, notwithstanding that the Donor is the vendor. It is important that
detailed particulars of the power of attorney are provided in the Execution Clause.
Below is an example of execution by an Attorney:

“SIGNED SEALED AND DELIVERED

by (name of the donee) the lawful Attorney of
(name of donor), the Vendor by virtue of
a power of attorney dated 1st January 2008
and Registered as No. 34 Page 21 Vol. 160
of the Lands Registry Office at Lagos.

In the presence of:

Signature:
Name:
Address:
Occupation:”

(9) ATTESTATION

30
Attestation facilitates proof of due execution.
Generally, attestation is not mandatory in Power of Attorney.
Power of Attorney attested to by a Judge, Notary public or Magistrate is presumed to be
duly executed: section 118 Evidence Act; Ayiwoh v. Akorede (1951) 20 NLR, 4.
A power of attorney intended for use outside the country should be attested to by a
Notary Public, for easy acceptance in the country of use.
This is because a Notary Public has credit all over the world.
But the fact that such is not attested to by a Notary Public does not render the Power
void.-MELWANI V. FIVE STARS LTD
“IN THE PRESENCE OF”
Name:………………………………………………
Address:…………………………………………
Occupation:………………………………………
Signature/Mark:………………………………

Or

BEFORE ME:

NOTARY PUBLIC/MAGISTRATE

PERFECTION OF A POWER OF ATTORNEY

GOVERNOR’S CONSENT
Governor’s consent is NOT NEEDED as it is not a document transferring interest in land
or the subject matter of delegation to the Donee. UDE V. NWARA
NB-Where Power of Attorney is used to alienate interest in land, it is registrable as
an instrument and Governor’s consent must be sought and obtained. The consent
column must be typed into the instrument as in the case of an assignment: see section
7 (b) (iii) of the State Lands Law, Lagos

STAMPING
Generally, Power of Attorney attracts a fixed stamp duty. Stamping is necessary for it to
be admissible in Court.
REGISTRATION
This depends on whether it qualifies as an instrument under the Land Instrument
Registration Law applicable to the State where it is used: UZOECHI VS. ALINNOR

WHEN A POWER OF ATTORNEY WILL BE A REGISTRABLE INSTRUMENT

1. It gives power to the Donee to deal with an interest in land
2. It is defined in the land Instrument Registration Law of a State as registrable
3. It is endorsed on any document transferring land i.e. a Deed of Assignment.
S.84&85 of the Registration of Titles Law of Lagos State.

31
NB-In some jurisdictions (such as in the FCT), the Lands Registry will demand a letter
of consent from the Donor before the Power of Attorney is accepted for registration.
This is to prevent fraud.

EFFECT OF NON REGISTERATION-non registration renders it inadmissible as

evidence in court: Ojugbele vs. Olasoji (supra)

ETHICAL ISSUES
1. Duty not to aid a non -lawyer in the unauthorized practice of law Rule 3(2) RPC.
Thus, a lawyer should not frank a document not prepared by him.
2. Duty to represent client within bounds of the law R. 15
Thus, solicitor should not circumvent the law by using a Power of Attorney as a
document of transfer of title to land or interest.
Lawyers use P/A in order to circumvent the obtaining of Governor’s consent
according to S. 22 LUA
3. Duty To be competent R. 16
A solicitor should demonstrate competence in drafting the power of Attorney in
terms of the specific powers and clauses.
4. Duty to render proper account R. 23
The solicitor should give prompt and true account of all rents collected in respect
of client property as well as all monies collected on behalf of his client.
5. Duty not to be negligent R. 14(5)
Solicitor should investigate to ensure that the Donee’s power has not been
revoked before he acts for his client who wishes to rely on that Power of
Attorney.
6. Disclosure of conflicting interests R. 17
A solicitor who is a donee of a Power of Attorney should not in the same
capacity draft the Power of Attorney.

THIS POWER OF ATTORNEY made the …… day of May 2012.

I, Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos (‘The Donor’) on the one part
HEREBY APPOINTS Mr. Samuel Abubakar an Estate Consultant of 55 Adeniyi Jones
Street Ikeja Lagos State (‘The Donee’) on the other part, to be my true and lawful
Attorney and in my name to do all that I may lawfully do as follows:
1. To lease the property at No. 45 Isheri Street Ikeja Lagos in favour of Virgin Atlantic
Limited for a term of ten (10) years.
2. To let out the four bedroom bungalow in Enugu State in favour of Alhaji Aboki Shehu
of 12 Agui street Enugu State.
3. To sell the three-bedroom bungalow at Awolowo Road, Ikoyi Lagos to Zenith Bank
Plc.
4. To sell the block of four flats at Sapele Delta State in favour of Professor Ugo
Ekanem.
5. AND I ALSO DECLARE that my Attorney may do all that is incidental to the power
already listed.
AND I DECLARE that this Power of Attorney shall remain irrevocable for a period of
twelve (12) months.

32
IN WITNESS OF WHICH I the Donor have executed this Deed in the manner below the
day and year first above written.

SIGNED, SEALED AND DELIVERED

By the Donor

……………………………….
Mrs. Aduke Thomas
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date

NOTE THE FOLLOWING

 if the power includes the right of the Donee to sue on behalf of the Donor, the
party clause in any Court action will be as follows:
Mrs Aduke Thomas (through her Attorney Abubakar Samuel) …………. Plaintiff .
after the due execution of a Power of Attorney, if Abubakar Samuel wants to
execute a Deed of Assignment or Lease on behalf of the Donor it may be as
follows:

THIS DEED OF ASSIGNMENT made the …day of …2012

BETWEEN Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos through her
Attorney Abubakar Samuel of 55 Adeniyi Jones Street Ikeja Lagos State (‘The
Assignor’) of the one part
AND Unik Ventures Ltd a company dully incorporated under the Companies and Allied
Matters Act with its registered office address at 10 Beach Road Victoria Island Lagos
(‘The Assignee’) of the other part. Complete other parts: recital, operative part and the
miscellaneous part.
IN WITNESS OF WHICH the parties have executes this Deed in the manner below the
day and year first above written.

SIGNED, SEALED AND DELIVERED

By the Assignor

………………….
Abubakar Samuel
The lawful Attorney of Mrs. Thomas Aduke appointed by virtue of a Power of Attorney
dated the 10 day of June 2011 registered as number 34 at page 54 volume 2011B at
the Lands Registry Ikeja Lagos State.
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date

The Common seal of Unik Ventures Ltd. (‘The Assignee’) was affixed on the …...day of
……..
2014 and duly delivered in the presence of:
……………………… ………………..
Director Secr

33
 WEEK 6: CONTRACT OF SALE OF LAND I
APPLICABLE LAWS- statute of Fraud 1677, law Reform (contract) Act, conveyancing
Act, 1882, Property and Conveyancing law, RTL Land Use Act 1978.
STAGES OF SALE OF LAND OR CONVEYANCING Comment [g12]: There are three broad
stages-contract completion and post
1. Contract stage completion stage.
2. Completion Stage
For convenience & better understanding, the procedure is better divided into five
stages:
1. Pre-contract stage: This involves a person carrying out inquiries on the land to find
out any physical defect (caveat emptor) and to negotiate the price etc.
2. Contract stage: This involves the preliminary enquiries; preparation and exchange
of a Formal contract of Sale, and the payment of initial deposit for the land purchase
price.
3. Post-contract stage This stage involves that the vendor deduces his title; the
purchaser investigates the vendor’s title in order to detect any defect in his title and
the exchange of the contract of sale of land.
4. Completion stage -This involves the Preparation and execution of the Deed of
Assignment, completion statement, handover of title documents
5. Post-completion or perfection stage This involves obtaining the Governor’s
consent, stamp the Deed and register it at the Lands Registry of the State where the
land is situated.

MEANS OF ACQUIRING LAND IN NIGERIA

1. Customary Law-SADIKU V.DALORI;NELSON V. EBANGA
2. Government allocation-State grant-ISERU V.CATHOLIC BISHOP OF WARRI
DIOCESE
3. Purchase/sale/assignment
4. By deed of gift
5. By inheritance-assent

RESTRICTIONS ON DISPOSITION OF LAND IN NIGERIA

b) Legislative restrictions
c) Contractual restrictions
d) Judicial restrictions
e) Customary restrictions

A. LEGISLATIVE RESTRICTIONS
1. Governor’s consent as provided by sections 22 & 26 LUA.-ABIOYE V.
YAKUBU
NB-QUDUS V.MILITARY GOV OF LAGOS STATE-consent is discretionary
2. Person under the age of twenty one years EXCEPT guardians– S. 7 LUA
3. Grant or transfer to a non-Nigerian except with the approval of the National
Council of States – S. 46(1) LUA.

34
 4. Properties owned by government agencies must be approved by the minister-S.
12(4)-The Nigerian Coal Authority Act cap N95 LFN 2004 NB-The absence of
the necessary ministerial approval is a serious defect which affects the title
sought to be conveyed…ROCKONOH PROPERTY LTD V NITEL PLC.
5. Town . Planning laws and regulations may restrict the alienation of certain lands
where the purposes for which they are intended to be used are contrary to the
purposes of town planning laws…J.A ADEDIRAN V. INTERLAND TRANSPORT
LTD.
B. JUDICIAL RESTRICTIONS
1. Doctrine of L.I.S PENDENS
This expression translates to pending law suit”. The doctrine is intended to preserve the
subject matter of litigation during the pendency of an action in court, so that there can
be no transfer of interest in land that is subject of litigation.-KACHALLA V.BANKI

CONDITIONS-
The doctrine will apply if the following conditions are shown:
 There is a pending suit in respect of the property
 The action is in respect of real property
 The action is for recovery or assertion of title to a specific property.
 The party concerned was aware or ought to be aware of the pending suit.
 A person who purchases property which is subject to litigation for value
consideration and without actual notice, cannot sustain his purchase -Ogundiani
v Araba

C. CONTRACTUAL RESTRICTIONS
Contractual Restriction includes covenants in leases
Usually, in a lease, it is typical to have a covenant not to reassign or sub let or otherwise
part with possession on the part of the lessee.

D. CUSTOMARY RESTRICTIONS
1. Communal/family lands- the consent of the principal members and heads of the
community or family must be obtained before there can be a valid sale – ADELEKE V
IYANDA.
 sale by family head without consent of PM-VOIDABLE
 Sale by family head as personal land-VOID
 Sale by principal members alone-VOID
LIMITATIONS OF THE NIGERIAN CONVEYANCING LAW PRACTICE ARE AS
FOLLOWS:
1. Multiplicity of Laws
2. Illiteracy
3. Failure of purchasers to consult solicitors until very late in the transaction
4. Professional incompetence and lack of diligence amongst lawyers
5. Uncritical dubbing of precedents etc
6. Contractual/legislative restrictions

35
7. Customary tenure/family property (Duality of Tenure in Nigeria land law
8. Touts and Estate agents have not helped the situation
9. Professional incompetence and lack of diligence amongst lawyers.
10. No full appreciation of contract before conveyance
11. Archaic mode of record-keeping at the lands registry creating difficulties in
investigation of title.
12. Lack of documentary evidence of title and weakness of proving traditional title where
there is no written evidence

NATURE OF CONTRACT OF SALE

 A contract of sale of land is an agreement to convey interest in land
 Preliminary step in the transfer of title to land
 Purchaser acquires equitable title while legal interest passes at completion
 Gives purchaser ample time to investigate his title
 All contracts for sale of land must be evidenced in writing-S.4,STATUTE OF
FRAUDS ACT 1677;S.5(2) LAW REFORM CONTRACT LAW;S.67 PCL

TYPES OF CONTRACT OF SALE OF LAND IN NIGERIA

1. ORAL CONTRACT OF SALE OF LAND
 Generally, unenforceable though not void or voidable-S.4 Statute of Frauds
1677;S.5(2)Law reform contracts Act 1961
 Deposit is not recoverable where purchaser is in default

EXCEPTIONS
1. SALE OF LAND UNDER CUSTOMARY LAW-, Sec. 4 statute of Frauds does not
apply to land transactions under the customary law. ALAKE v AWAWU
a) Price
b) Possession
c) Witnesses must be present during the transaction-ADEDEJI V. OLOJI
d) Property/land must be specifically identifiable.

2. ACTS OF PART PERFORMANCE- equitable remedy of specific performance may

be granted-e.g. the building has commenced on the land or money has been paid.
KACHALLA V. BANKI ;INTL TEXTILE INDUSTRIES V.ADEREMI;THOMAS
V.BROWN

3. SALES MADE BY THE COURT-Protected even where there is inadequate memo

evidencing sale

2. OPEN CONTRACT
 All transactions on land are to be in writing-section 5 of the Law Reform
Contract Act and section 4 of the Statute of Fraud;Kachalla v. Banki

36
  An open contract meets the minimum conditions as will be listed below of being
in writing but its terms/ conditions are to be implied by Law: (p
a. It is made in writing in a receipt or by several documents put together or in a note or
memorandum.
b. PRICEThe consideration paid is stated
c. PARTIES& PROPERTY-It adequately described the parties and the property
d. SIGNATURE-It is signed by the party to be bound.
S. 5 of the Law Reform Contract Act ; PAYE V.GAJI ALI SAGE V. NORTHERN
STATE COTTON BOARD.

FORMS OF OPEN CONTRACT Comment [g13]: The major disadvantage

to the purchaser is that it is a contract
1. LETTER-AKPARA V. UAC 1.Entered into without proper legal advice,
2. RECIEPTS-KACHALLA V. BANKI;OSAGIE V. OYEYINKA;YAYA UBA V Tejumola (1988) 2 NWLR (pt79) 662,
A.G. Kaduna State V Attah (1986) NWLR,
V.MORGAJI;DJUKPAN V GRIVUYOUHE Watson V Burton (1957) IWLR 19.
2.Searches and enquires are not carried out. It
3. JOINDER OF DOCUMENTS-OKORRO V. OGARA is not possible to fix time for the re
3.A major disadvantage to the vendor is that he
4. ROUGH DRAFT OF AN AGREEMENT-GREY V. SMITH is called upon to show full statutory title.
3. FORMAL CONTRACT OF SALE OF LAND 4. There will be no provision to confer on the
vendor a right to rescind the contract or to
 Enforceable regulate the payment of interest on the
purchase money or the compensation for mis-
 It is in a formal form fulfilling the conditions in section 5 of the Law Reform description.
Contract Act
 it goes further to set out the terms EXPRESSLY AGREED by the parties in
addition to the three p’S thus excluding the application of the implied terms of the
Law.
 USUALLY DRAFTED BY VENDORS SOLICITOR Comment [g14]: Parties may create a
contract that is partly formal and partly open

ADVANTAGES OF A FORMAL CONTRACT OF SALE OF LAND

1. It crystallizes the positions of the parties.
2. Contract can be used to circumvent implied covenants or even create restrictions
in the use of land.
3. It complies with the requirements of S.4 of the Statute of Frauds.
4. To reduce the incidence of stamp duty, especially where it is a furnished house –
fixtures and fittings could be separated from land and building. This is because
chattels pass by mere delivery.
5. A contract can be used to determine the position of the parties before consent
under S.22 LUA 1978.
6. A contract will enable the purchaser or his solicitor/agents have enough details
about the property to enable him conduct necessary search.
7. It prevents gazumping (sale at higher price) and gazunduring(refusal to buy based
on lower price offer.
8. It is binding on the parties thus prevents last minute withdrawal
9. Vendor can tender it as evidence of expectation of money while purchaser can
mortgage his equitable interest. Ogundaini V Araba
10. Affords parties an opportunity of conferring some privileges/benefits on the
purchaser pending completion --- e, possession before completion

37
11. Death of either party would no longer affect the contract as a binding contract is in
place

FORMAL PARTS OF A CONTRACT OF SALE OF LAND

It is divided into two broad categories with other components as follows:
A-PARTICULARS OF SALE which consist of;
a. Commencement
b. Date
c. Party clause
d. Testatum
e. Capacity of the vendor and description of the property

B-SPECIAL CONDITIONS OF THE SALE (THE TERMS AGREED UPON) WHICH

CONSIST OF;
1. DEPOSIT: This is not a mandatory requirement but it is expedient. Usually 10%
FUNCTION-
 The payment of deposit is a sign or evidence of commitment on the part of the
purchaser
 it binds the vendor who cannot sell the property to another person unless there is
a breach by the Purchaser.

NB: DIFFERENCE BETWEEN DEPOSIT AND PART PAYMENT-BIYO V. AGU

Deposit is some token payment and is non-refundable in the event of default by the
purchaser.
For part payment, the parties have agreed on the contract already and the payment is a
portion of the purchase price. The vendor can recover part payment as a debt

4. BALANCE AND INTEREST ON UNPAID BALANCE

 The balance of the purchaser price should be paid on completion.
 It is always important to pay the balance of the purchase price within the
stipulated time-ODUSOGA V RICKETTS
 The parties may also agree on the time for payment of the balance and the
interest to be charged in the event of a delay
 At common law, the interests is usually fixed at 4%. ESADILE V.STEPHENSON
 ADVISE-t is advised that parties should avert their minds to the prevailing
banking(CBN)interest rates

5. CAPACITY OF THE VENDOR

The contract should expressly state the capacity in which the vendor is conveying
interest. The vendor may convey as a beneficial owner, mortgage, trustee, personal
representative or an absentee.
The Vendor must also have the legal capacity to convey, thus he should not be a minor,
insane person or lunatic.
The capacity of the vendor will determine the covenants to be implied in the contract.

38
4 CHATTEL/FIXTURES AND FITTINGS
Used to transfer legal interest in Chattels or fittings are personal property which are
usually movable.-PHILIPS V. LAMDIN
Fixtures are fixed to the land. Thus, fixtures also form part of the land. Hence, the
principles, whatsoever is fixed to the land, belongs to the land. Where a separate
amount is agreed for fixture, then the amount will not be included in the instrument.
One benefit of transferring fittings at the contract state is that the purchaser is relieved
from paying heavy stamp duties. The fixtures are usually included in a schedule to the
contract

6. DATE OF COMPLETION
Generally, time is not of essence at this contract stage. S.68 PCL
But completion must be within reasonable time. REYNOLDS CONSTRUCTION
V.EDOMWONYI; JOHNSON V. HUMPHREY
It is advised to be within 3 months to avoid uncertainties.-OLANIRAN V ADEBAYO
However, where time is made essential to the completion of the contract, failure to
complete the contract may lead to rescission of the contract, except the vendor ratifies
the delay.

7) POSSESSION BEFORE COMPLETION

 Possession generally goes in hand with legal ownership.
 Thus, the purchaser is not entitled to possession until completion of sale.
 However, where it is agreed, the vendor may bring the purchaser in as a
Licensee or as tenant at will.
 This fact must be stated in the contract to avoid difficulties in evicting the
purchaser in the event of failure of the contract-ODUTOLA v PAPERSACK
(NIG) LTD.
 Where the Purchaser has taken possession and he is aware of defects in the
property, he cannot complain because it is deemed that he has waived his right.

8) INSURANCE PENDING COMPLETION
 The law is that risk passes to the Purchaser immediately after the contract is
exchanged.
 Thus, the purchaser is advised to insure the property. CASTELLIAN V
PRESTON;S. 72 PCL; S. 66&67 (1) INSURANCE ACT 2007
 Where the vendor insures the property in his name, he has the right to collect the
monies paid upon any damage to the property and can use it as he wishes.
 The purchaser cannot compel the vendor to use the money collected to reinstate
the property-RAYNER V PRESTON.

11. EXCEPTIONS AND RESERVATIONS

Vendor must incorporate such terms or he forfeits the right-TEE BAY V.
MANCHESTER RAILWAY CO
NB-TESTIMONIUM, SCHEDULE; EXECUTION AND ATTESTATION ;FRANKING

39
VOID TERMS IN A CONTRACT OF SALE
Any clause empowering PURCHASER to
 SEEK CONSENT OF EQUITABLE OWNER
 ACCEPT IMPERFECT TITLE
 RETAIN VENDORS SOLICITOR
 PAY FOR VESTING ORDER
Any clause preventing purchaser from;
 Access to parent documents
 Inquiring into insufficient stamp duty paid-S.108 SDA

PAYMENT OF DEPOSIT IN A CONTRACT OF SALE OF LAND

 The payment can be made directly to the vendor or the vendor may direct that
his solicitor receives it.
 The vendor’s solicitor may receive the deposit either as an agent or a
stakeholder-ROCKEAGLE V. ALSOP
 If he receives it as an agent, he keeps the deposit for the vendor and if he
misuses it the vendor will be liable to refund it to the purchaser upon a failure of
the transaction. SORRELLV. FINCH
 However if the Vendor’s solicitor receives the deposit as a stakeholder, he is not
the agent of any of the parties and he will have to give the money to the party
entitled to it whether the contract succeeds or not. If he misuses the money
collected, he will be personally liable.

THE CAPACITY OF THE VENDOR/ASSIGNOR/LESSOR/MORTGAGOR IN THE

VARIOUS PROPERTY TRANSACTIONS -. S. 100 -101 of the PCL and S. 17 of the
RTL
The capacity may be:
1. As beneficial owner
2. Trustee
3. Representative capacity e.g. family head
4. Attorney etc.

THE COVENANTS IMPLIED WHEN A PARTY TO A PROPERTY TRANSACTION

ACTS IN A CAPACITY AS A BENEFICIAL OWNER ARE: S.7(b)CA 1881 Comment [g15]: What covenants do the
term beneficial owner connote generally in
1. He has the right to convey transfers other than leases-Q1(3) APRIL 1998
2. He has given the purchaser the right to quite enjoyment and possession of the
property
3. The property is free from any encumbrances and claims other than those disclosed.
4. He gives a further assurances to the purchaser to indemnify him if the title is bad.

IF IT IS IN A LEASE, THE COVENANTS IMPLIED WHEN THE LESSOR ACTS AS A

BENEFICIAL OWNER ARE:
1. He has the right to convey

40
2. He has given the purchaser the right to quite enjoyment and possession of the
property
3. The property is free from any encumbrances
4. He gives a further assurances to the purchaser to indemnify him if the title is bad
5. the lease is valid and still subsisting
6. all the covenants on the land have been performed

IF IT IS IN A MORTGAGE, THE COVENANTS IMPLIED WHEN THE MORTGAGOR

ACTS AS A BENEFICIAL OWNER are:
1. He has the right to convey
2. He has given the purchaser the right to quite enjoyment and possession of the
property
3. The property is free from any encumbrances
4. He gives a further assurances to the purchaser to indemnify him if the title is bad
5. the lease is valid and still subsisting
6. all the covenants on the land have been performed
7. that the mortgagor covenants to repay the loan and interest.

PRE-CONTRACT ENQUIRIES
 The law does not place any obligation in the vendor to disclose any defects in the
property to the purchasers especially where such defects can be discovered by
mere inspection of property.
 Thus, the Purchaser is advised to carryout an inspection of the property.
 Once the contract has been exchanged, the purchaser is bound b those facts for
which the law places a duty on him to enquire i.e. (Caveat Emptor – Buyer
beware.
 However, it has been declared that the doctrine of caveat emptor only applies to
PATENT DEFECTS and not to latent defects. YANDLE V. SUTTON; EJIGINI V.
EZENWA
NB: Where there is a misrepresentation of PATENT FACTS on the part of the vendor,
such misrepresentation is actionable.(DAMAGES).

EXCHANGE OF FORMAL CONTRACT OF SALE OF LAND

This is when the Formal Contract of Sale is executed in several copies and exchanged
by the parties to show that they are bound by it.
A contract is effective after exchange-AWOJUGBAAGBE LIGHT IND. V.
CHINUKWE;DOMB V.BOZ
It is very important to exchange the contract otherwise it will not be binding. –ECCLES
V. BRYANT
The exchange is done at the Vendor’s solicitor’s office. COMMISSION FOR THE NEW
TOWNS V. COOPER.
The procedure for the exchange of the Formal Contract of Sale of Land depends
on whether one solicitor acted for both parties or not as follows:
A- WHERE ONE SOLICITOR ACTS FOR BOTH PARTIES TO THE SALE OF LAND Comment [g16]:

41
Before a single solicitor acts for both parties, he should ensure that the following are
done:
1. The title to the property is sound
2. The terms are unambiguous and agreed upon by the parties already
3. The transaction is of no serious legal consequence.
4. there is no likelihood of conflict between the parties
5. where there are no other available solicitors
nb- exchange takes place once both parties SIGN PHYSICAL EXCHANGE not needed.
-SMITH V. MANSI

THE PROCEDURE FOR THE EXCHANGE WILL BE AS FOLLOWS:

1. obtain all the facts from the vendor on the property
2. give all such information collected from the vendor to the purchaser
3. Obtain a written confirmation of acceptance from the purchaser to buy the land
4. the solicitor will then draft the contract to be executed by the parties. Comment [g17]: DUTIES OF VENDOR’S
SOLICITOR ---
5. The exchange is done once parties sign He obtains all the facts in respect of the
property’s title and physical state form the
vendor i.e. address of the property, nature of
B-WHERE DIFFERENT SOLICITORS ACT FOR THE PARTIES title, price, deposit, fixtures and fittings,
easement, restrictive covenant to which it is
THE PROCEDURE FOR THE EXCHANGE OF CONTRACT WILL BE AS FOLLOWS: subject insurance, completion date etc.
The vendor’s solicitor could act as an agent of
1. The vendor’s solicitor will obtain all the necessary information, draft the agreement the vendor or a stakeholder when it comes to
keeping the deposit paid by the purchaser.
and send same to the purchaser for amendment.
2. The purchaser’s solicitor ensures his client gets good title by crosschecking it to DUTIES OF THE PURCHASER’S
SOLICITOR –
reflect agreed terms, then he sends the draft to the vendor’s solicitor The solicitor must ensure his client gets a good
title.
3. Vendors solicitor will engrosse the document after effecting necessary corrections. He should take full instructions in writing.
4. Vendors solicitor will produce 2 PLAIN copies and sends one to the purchasers s He should obtain the particulars of the
purchaser, vendor and the property, etc.
solicitor and retains the other copy for the vendor to sign. He must have a check-list of terms to be
negotiated and agreed upon.
5. The purchaser takes his executed copy to the vendors solicitors office together with He is to ensure all contractual restrictions are
complied with. It is his duty to ensure title to
the deposit in exchange for vendors signed copy.(PHYSICAL EXCHANGE) the ppty is sound
6. The vendor’s solicitor will then prepare the final Contract of Sale for execution CONTRACTUAL RESTRICTIONS IN A
CONTRACT FOR SALE OF LAND
1.Consent provisions e.g. S.22 LUA (1978) not
to part with possession without consent of
RIGHTS AND OBLIGATIONS OF THE PARTIES AFTER THE EXCHANGE OF THE Governor or any authorities are complied
upon.
FORMAL CONTRACT OF SALE OF LAND 2.Restriction on title with respect to an
A-PURCHASER encumbered title e.g. mortgage or charge of
any sort.
 The purchaser acquires an equitable interest on the land. 3.Family property
4.Planning restrictions e.g. industrial area,
 May transfer/ mortgage his interest in the property to another person residential area, business district
5.Compulsory acquisition of land whether
 He can protect his equitable title(injunction prohibiting further global or restricted.
transfers/committing acts of voluntary waste. 6.He must ensure with the aid of a surveyor,
architect and other professionals that the land
does not contravene planning laws e.g.
infrastructural layout, roads metro-lines,
B.VENDOR sewage etc; ensure all permissions and
 The vendor becomes a qualified trustee –has substantial interest in the approvals were obtained.
7.That all laws as to acquisition of land are
property(balance)-UNIVERSAL VULCANIZING NIGERIA V.IUTTC complied with e.g. state land laws of each
state, acquisition of land by alien law of the
 Owner of the balance of the purchase price.a relevant state etc.
8.Ensure that the physical condition of the
 Vendor is entitled to rents and profits until Completion BUT MUST ACCOUNT.- property meets the buyers’ expectations.
PLEWS V. SAMUEL

42
  The vendor has a right of lien on the property to the extent of the unpaid balance
and remains in possession-LAKE V. BAILEYS

EFFECT OF DEATH OF EITHER PARTIES ON THEIR OBLIGATIONS

 The death of either party to the transaction does not terminate their obligations.
 Their personal representatives can be compelled to complete the contract.
GWANGWAN V.GAGARE

EFFECT OF CONTRACT ENTERED INTO BY AN INSANE PERSON

if made during lucid intervals,it is VALID.if it is made outside lucid intervals-it is VOID
DISCHARGE OF A CONTRACT OF SALE
It is discharged when a deed of assignment has been EXECUTED in purchaser’s favour

PERFECTION OF A FORMAL CONTRACT OF SALE OF LAND

1.Consent of the Governor
This is not needed as a formal contract of sale of land does not transfer legal interest.
SOLANKE V. ABED; OKUNEYE V. FBN PLC
S. 22 (2) of the Land Use Act and AWODUBAGBE LIGHT HOUSE INDUSTRIES
LTD V. CHINUKWE.
2.Stamping
Stamp duty is to be paid within 30 days of its execution.
The stamp duty is a FIXED fee. S. 23 of the Stamp Duties Act.
EFFECT OF NON STAMPING-it is a criminal offence.an unstamped document is
inadmissible in evidence
3.Registration
For a Formal Contract of sale of land to be registrable, it depends on the state Law
as follows:
a. In the Northern and Lagos States, it is not registrable. –CAP 58 LAW OF
NORTHERN REGION;S.4 Lands registration regulation under LIR,CAP 64.
b. In the PCL States of the Old Western Region, it is registrable as an Estate
Contract.-S.2 LIRL
c. In the Eastern Region, there is no provision of the Law but in OKOYE V. DUMEZ it was
held that it is registrable.

EFFECT OF REGISTERATION OF CONTRACT OF SALE OF LAND

 it serves as a notice and does not vest any legal interest in the purchaser.
 Contract may be used to support claim for specific performance-FAKOYA V. ST PAULS CHURCH

EFFECT OF NON REGISTRATION

 Registration governs priority amongst competing contracts
 The contract would be inadmissible to prove title-GABRIEL TEWOGBADE V.
OBADINA

43
 THE INSTRUCTIONS NEEDED TO DRAFT A FORMAL CONTRACT OF SALE OF
LAND
1. Particulars of the parties
2. Particulars of the property
3. Consideration
4. Capacity of the vendor
5. Particulars of witnesses
6. Conditions of sale (deposit/insurance,etc)

ETHICAL ISSUES
1. Duty of solicitor not to mix client’s money with his personal income i.e. duty not to
misappropriate client’s fund-R.21
2. Vendor’s solicitor holds deposit as a stakeholder, thus should be honest in his dealings.

THIS AGREEMENT made the ………………. Day of ………….. 2012

BETWEEN Mrs. Aduke Thomas of No. 45 Isheri Street Ikeja Lagos State (‘The Vendor’)
of the one part
AND
Professor Ugo Ekanem of No. 11 Park Street Asaba Delta State (‘The Purchaser’) on
the other part.
IT IS AGREED ;
That the Vendor as BENEFICIAL OWNER sells and the Purchaser has agreed to buy
ALL THAT property at No. 10 Bingo Street Sapale, Delta State covered by a Certificate
of statutory Right of Occupancy No 641231 dated !2/11/2006 and registered as
14/14/2387 rightly described in the First Schedule, subject to the following terms and
conditions:
1.CONSIDERATION:
The consideration for the sale of the property shall be the sum of thirteen million naira
only (N13, 000, 000.00).

2. DEPOSIT
The purchaser shall before the execution of this Agreement pay the deposit of the sum
of seven million (N7, 000, 000.00) to the vendor’s solicitor who shall hold the deposit as
stakeholder pending completion

3. BALANCE
The balance of the consideration being the sum of six million (N6, 000, 000.00) shall be
paid at completion, and if there is delay caused by the default of the purchaser he shall
be liable to pay interest at the prevailing bank rate.

4. CHATTELS, FITTINGS AND OTHER ITEMS

The sale includes chattels, fittings and other items specified in the second schedule
and valued at the sum of N……………………………….(the receipt of which the Vendor
acknowledges).

5. CAPACITY
The Vendor sells as Beneficial Owner subject to the clause to be inserted in the
Assignment;

44
PROVIDED ALWAYS and it is agreed that the covenants which are implied by reason
of assigning as beneficial owner shall not be deemed to imply that the vendor has
performed the covenant for repairs contained in his document of title.

6.POSSESSION BEFORE COMPLETION

The purchaser after the execution of this Agreement shall take immediate possession of
the property for his use and enjoyment as licencee, and if he defaults in the payment of
the balance at completion he shall peacefully give up possession of the [property to
the vendor and the deposit paid under this Agreement shall be forfeited.

7. DATE AND PLACE OF COMPLETION

It is agreed that time is of the essence of this Agreement which shall be completed on or
before ………. of ………..2014 at the office of the Vendor’s solicitor.
8. INSURANCE
The vendor shall insure the property with a reputable insurance company registered in
Nigeria against loss caused by fire, flood and other usual peril for the cost of
reinstatement, and the insurance policy shall be assigned to the purchaser at
completion.

PROVIDED THAT where reinstatement is not possible the insurance money shall be
shared between the parties pro rata the deposit paid the purchaser.
9.INDEMNITY
The vendor agrees to indemnify the purchaser for any loss or damage arising from and
connected with the title of the Vendor.

10. COST AND EXPENSES

The purchaser shall pay all costs incidental to the preparation and execution of this
Agreement.
11. CONCLUSION
This contract shall prevail over any previous agreement and it contains all the terms
finally agreed by the parties.

IN WITNESS OFWHICH the parties have executed this Agreement in the manner below
the day and year first above written.
1ST SCHEDULE
Description of the property

2ND SCHEDULE
List of chattels and fixtures sold along with the property and their prices
SIGNED by the Vendor
Mrs. Aduke Thomas ………………….
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date:

SIGNED by the Purchaser

Prof. Ugo Ekanem ………………….
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature
Date:

45
 WEEK 7: SALE OF LAND II
B-POST-CONTRACT STAGE
1. The vendor deduces his title
2. The purchaser investigates the vendor’s title
3. The purchaser’s solicitor writes a Search Report

DEDUCING OF TITLE
After the exchange of contracts, the vendor is required to show that he has a good root
of title, ie that he is in a position to transfer what he has contracted to convey and in the
manner in which he discharges that duty.
Thus, the vendor is under a duty to deduce his title to the land after the contract is
exchanged. MEPC. LTD V. CHRISTIAN –EDWARDS
The obligation to deduce title depends on the applicable law.

IMPORTANCE OF DEDUCING OF TITLE

1.It assist in the recital or evidence of the history in documents up to 20 years old are
presumed to be correct. S.162 of the Evidence Act 2011.
2.It serves as estoppels against all persons mentioned

DEDUCING TITLE IN THE RTL STATE OF LAGOS

 The Vendor does not need to deduce his title like is done in the CA and PCL
States. In the RTL Districts title to a land is registered and guaranteed by the
State.

UNDER REGISTRATION OF INSTRUMENTS:

This is obtained under the CA and PCL states. Here, the Instrument is registered and
not the title.
Thus, the title could be defective and cannot be cured by the mere act of registration

LIMITATION OF YEARS: A purchaser must insist that the title be deduced up to a

certain number of years.
1. 40years – In CA states (ie former Eastern and Northern Region S.2

VENDOR AND PURCHASER ACT 1874

NB-The 40years here is 40 years preceding the date of the present transaction.
 In ABIA STATE: It is 30 years–S.70 (1) Abia State law of property
2. 30 years: In PCL states (ie former Western Region of Nigeria). S 70(1) PCL-
SULEIMAN V. JOHNSON.
3. 12 Years: In Lagos; the right of an owner of land becomes extinguished after 12yrs
of adverse possession. But it must first be established that the owner has been
dispossessed or has discontinued possession MAJEKODUNMI V. ABINA
4. 20 years: Generally, a presumption of regularity is raised in favour of facts or
statements contained in the Recitals of a document which is 20 years old.

46
 NB-The person named in the document will not be allowed to deny the facts contained
in the recitals of the document. S. 162 Evidence Act 2011; S17 and 21 Limitation
Law of Lagos State

METHOD OF DEDUCING TITLE

The vendor can deduce his title by his production of abstract or epitome of title.
Both documents are the title of the vendor.

ABSTRACT OF TITLE
An abstract of title is a written chronological summary of the history or account of how
the property under consideration has moved from one person to another beginning with
a root of title up to the present vendor who now wants to sell.
In the past when photocopying machines were not reality available, the abstract was
typed on a brief paper divided into 6 COLUMNS shown below.

Date of Nature of Parties Whether Number of Whether

Abstract or original
Document Event Photocopy Documents Handed over
1902 Settlement Abstract Nil Nil

EPITOME OF TITLE
An epitome of title is a schedule of documents and events which constitute title to
the property accompanied by photocopies of the said components.
Generally, while abstract of title deals with the original set of the document of
title, the epitome of title deals with the photocopies of the documents of the title.
BOTH CONTAIN dates; parties; trannsactions.

NB: ORIGIN: Abstract originated as a result of difficulties of delivering documents and

deeds of title to the purchaser for verification hence the use of abstract. But the advent
of photocopying and scanning machines have reduced the importance of abstract.

Date of Nature of Parties Whether Number of Whether original

Abstract or document to be
Document Event Photocopy Documents Handed over on
completion
10/03/89 Grant Military Govt Photocopy 1 Yes
& Mr. Ade
9/6/2000 Mortgage Mr. Ade and Photocopy 1 Yes
First Bank PLC
16/01/2013 FBN PLC Photocopy 1 Yes
And chief Amachi

47
 THE SOLICITOR SHOULD SATISFY HIMSELF IF THE ABSTRACT/ EPITOME OF
TITLE HAS THE FOLLOWING MATTERS:
1. It commences with a good root of title
2. Whether the parties mentioned in the transaction had power to buy or convey, or
otherwise deal with the property.
3. That there is no subsisting encumbrances except those that are disclosed in the
contract.
4. That all mortgages and charges have been duly discharged
5. That all the documents are duly executed, requisite consent obtained and
stamped and registered.

AN ABSTRACT SHOULD CONTAIN THE FOLLOWING

i. Date of document
ii. Nature of the event
iii. Parties to the transaction in the stated event
iv. Whether documents are (TC or photocopy
v. Number of documents
vi. Whether original document is to be handed over on completion.

ADVANTAGES/IMPORTANCE OF USING ABSTRACT/EPITOME OF TITLE

a. It provides at a glance the nature of the vendor’s title
b. Helps the purchaser’s solicitor to make requisitions on title
c. It assists the purchaser’s solicitor in preparing a search report on title
d. It provides a prima facie evidence of any defect /in vendor’s title; however, this is
not a concussive evidence.
e. It aids the detection of encumbrances on the property or title.

DISADVANTAGES OF ABSTRACT/EPITOME
a. Possibilities of making error in preparing the abstract
b. Preparing abstracts take a longer period than photocopying
c. Time is spent in examining the abstract against the original.

ROOT OF TITLE
This is a document of title which is sufficient in itself without any extrinsic evidence to
establish the title to the land. This shows if the vendor has a valid right to sell the land
and if it is unencumbered.

CONDITIONS-S.63 CA;S.88 PCL

The conditions to be satisfied for a document to be a good root of title are as follows:
1.It must transfer both the legal and equitable interest in the property
2.It must clearly describe the property and extent of interest being conveyed
3.It must clearly state the owner of the property
4.It must not be subject to any higher interest over the property

48
5.Nothing on the face of the title should cast doubt on its authenticity AKINDURO V.
ALAYA

EXAMPLES OF DOCUMENTS CONSTITUTING GOOD ROOT OF TITLE

1. Deed of gift; since a gift of land is permanent
2. Duly perfected Deed of Assignment; transfers unexpired term
3. Deed of legal mortgage; transfer legal interest
4. Land certificate-Title acquired by a subsequent purchaser of registered estate
under the RTL
5. Certificate of purchase; certifies sale of land pursuant to a court process.
6. Assent(PCL)and probate

EXAMPLES OF DOCUMENTS CONSTITUTING BAD ROOT OF TITLE

a. Lease; because it transfers only possession not title
b. Licence
c. A will; because it may be challenged later NB: A will is not strictly a bad root of
title; it become valid once admitted to probate.
d. A power of Attorney; does not convey interest in land
e. Unregistered deed of assignment.
f. An equitable mortgage, does not covey the legal interest
g. Certificate of occupancy; (is alone not sufficient evidence of title because it can
displaced-OGUNLEYE V.ONI

WHEN IS A CERTIFICATE OF OCCUPANCY A GOOD ROOT OF TITLE

However a Certificate of Occupancy may be a good root of title if the following exist:
1. It is granted in respect of a statutory or customary grant of a right of occupancy
pursuant to S.5 and 6 of the land use act
2. There is any other thing to prove title e.g. long possession
3. When it is a state grant OLOJUNDE V ADEYOJU
STATUS OF C OF O
 A certificate of occupancy is issued as evidence of a grant of title to a person in a
piece of land
 Raises presumption that holder is in exclusive possession
 It is not Conclusive; can be rebutted by a person with better title-OGUNLEYE V.
ONI.
 It would not be a good root of title with respect to a deemed grant under S.34 and
36 of the act

HOW CAN A SOLICITOR SATISFY HIMSELF OF VENDORS TITLE Comment [g18]: Q 6(III)
1. Raising requisitions
2. Searches in the land registry
3. Investigating court judgments
4. Inspecting original title documents
5. Investigating traditional tile if needed
6. Physical inspection of property-IDUMDUN V.OKUMAGBA

49
 INVESTIGATION/SEARCH ON TITLE Comment [g19]: WHY CONDUCT A
SEARCH BEFORE CONTRACT
This is the process of conforming the title of the vendor deduced by him. The main reason why enquires are necessary
The purchaser’s solicitor must investigate the vendor’s it in order to see before contract is based on the principle of
Caveat Emptor. (The purchaser cannot rescind
whether any defect exists in the title deduced by the vendor. the contract because of non disclosure of
patent defects).
Investigation of title is usually done by way of search conducted in all places and Search will reveal encumbrances on land.
offices where there may be particular or details of the property. A physical inspection will eliminate
constructive notice.
Will reveal easement and restrictive
covenants which he ought to have found out
WHAT ARE THE DOCUMENTS YOU ARE LIKELY TO FIND DURING SEARCH OF at contract stage if he had done a diligent
DOCUMENTS. search

1. application for allocation of land and the Land

2. a C of O
3. A power of attorney
4. A deed of assignment
5. A mortgage deed

THE SOLICITOR AFTER PERUSAL OF ABOVE DOCUMENTS must be satisfied as to

1. Names of the parties on the documents
2. Description of the property
3. Signatures on the documents
4. Encumbrances if any
5. CSR compliance

THE PROCEDURE FOR INVESTIGATING TITLE UNDER THE CA AND PCL STATES
1. The purchaser’s solicitor collects abstract and epitome of title from the vendor
2. The purchaser’s solicitor conducts a physical inspection of the property in order to
discover patent defects (defects relating to the title of the property).
3. He is to carry out an investigation of the traditional history of the land
4. He is to conduct a search in the various Registries depending on the nature of the
title e.g. the Probate Registry, Corporate Affairs Commission, High Court
,Lands Registry etc
5. He is to raise requisitions if necessary. In doing this, he is to do so WITHIN 14
DAYS of the Exchange of Contract and the vendor’s solicitor HAS 7 DAYS on the
receipt of the requisition to reply
6. He is to write a Search Report to be forwarded to the Purchaser.

WHY IS A LAWYER NEEDED IN INVESTIGATION OF TITLE Comment [g20]:

1. To ensure thorough and professional investigation of title and conduct physical Comment [g21R20]: Q6(3)-march 2004
inspection of the property
2. To ensure the statutory requirement of writing is met
3. To ensure that property described in particulars of sale correspond with the one the
purchaser is buying-ALI SAGE V. NORTHERN STATE MARKETING BOARD
4. To ensure removal of contractual restrictions with respect to sale of the property and
transfer of interest
5. To ensure obtaining of relevant consents

50
6. To ensure purchaser’s compliance with all relevant laws concerning acquisition of
land in the state
7. To ensure the purchaser gets a good title

THE PROCEDURE FOR INVESTIGATION OF TITLE UNDER THE RTL

1. The purchaser’s solicitor is to collect the letter of consent, CTC of Land Certificate
and a sworn declaration from the Vendor or his solicitor
2. He is to conduct a physical inspection of the property/ land
3. He is to investigate the traditional history if it is a family land
4. He is to search the lands Registry and other Registries by paying the prescribed
search fees
5. Search the Register at the land Registry which comprises of the following: -S.69
RTL
a. Property register
b.Proprietorship register
c. Charge register
6. He is to raise requisitions if necessary
7. Prepare a Search Report

PLACES WHERE SEARCH ARE CONDUCTED

Searches are conducted in the following places:
1. LANDS REGISTRY
This is where the lands in a state are administrated.
It is usually located at ministry of lands, Survey and Town Planning.
A search at the land registry would reveal the following:
i. The nature of the grant and holder of the interest
ii. The description of the property – size survey plans, beacons
iii. Details of fees paid on the people such as taxes, ground rents etc
iv. Details of registered transactions on the person as previous deeds contracts of
sale etc.
v. Reveal previous and existing encumbrances on the person eg mortgage
vi. Any act of government acquisition of the person
vii. Any court judgment obtained and registered over the person which affects the
vendor’s title
viii. Counter parts (office/file copies) of right of occupancy or certificate of occupancy
on the person.

ABUJA GEOGRAPHIC INFORMATION SYSTEMS (AGIS)

AGIS was established in 2003.
It regulates Land administration in Abuja, the Federal Capital Territory
Prior to its establishment, that function had been vested in the lands department of the
Federal Capital Development Authority (FCDA).

51
 PROCEDURE FOR CONDUCTING SEARCHES AT AGIS
1. Write an application to conduct a search stating the particulars of the land
2. Obtain a letter of consent from owner of the title authorizing the purchaser’s
solicitor to conduct the search. Attach same to application
3. attach evidence of payment of search fee paid at a designated Bank
4. The officials at AGIS would conduct the search and complete the search report.
5. The search report is to be signed by the Registrar of Deeds
NB-Thus, the solicitor does not have a direct and personal view and inspection of the
file. However, in some circumstances, The solicitor may have personal contact with the
file.
NOTE: The conduct of a search by the officials at AGIS (rather than the solicitor
personally) is a particular risk which requires the solicitor to warn the client of the
consequences of the process.

STATES LAND REGISTRY

The steps to conduct the search are:
a. Write an application to conduct a search to the commissioner for lands in the
state. Comment [g22]: DRAFT SAMPLE LETTERS
b. Attach evidence of payment of search fee.
c. Attach copy of certificate of occupancy
d. The application is processed and the permission of the commissioner is granted
to conduct the search.
e. The file on the person is produced from the strong room and given to the solicitor
to peruse the entries, examine and make a record of his findings.

FEDERAL LANDS REGISTRY

Administers Federal Lands located in the states or the Federal capital territory
they register all titles of federal. Government and all interests created by subsequent
transactions on lands vested in the Federal Government and its agencies.

2. PROBATE REGISTRY
The Probate Registry of states keeps a record of wills and other testamentary
documents.
The probate Registry is part of the registry of the High Court in various states.
This search becomes necessary if there is a fact in the abstract of death of
any of the predecessors- in-title to the people.

SEARCH AT THE PROBATE REGISTRY MAY ANSWER ANY OF THE FOLLOWING-

a. Whether the people was subject of bequest will (Probate) or intestacy (Letter of
administration).
b. Who are the personal representatives entitled to convey title
c. Who are the beneficiaries under the probate or letter of administration
d. Whether any assent has been executed

52
e. Whether there is any challenge on the will. Probate or administration and any
judgment thereto.

3. CORPORATE AFFAIRS COMMISSION

Where a company, business name or Incorporated Trustees is a party to a
property transaction,

A SEARCH IS TO BE CONDUCTED AT THE CAC TO DISCOVER THE FOLLOWING;

i. Whether the company or Incorporated Trustees is registered and has the
capacity to conduct the transaction
ii. Whether there is any record of any of the properties of the company in the (AC
Register.
iii. Whether there is a registered resolution of the Board of Directors or Trustees, to
acquire or dispose of the people.

4. COURTS
A search at the court for any judgment is intended to determined
a. If the person was subject to any court litigation and the outcome of the Comment [g23]: . What amounts to
completion for vendor consists of:
dispute 1.Conveying with a good root of title the
property contracted to be sold.
b. Whether any appeal is filed against the judgment and the result of the 2.Delivering up actual possession and
enjoyment.
appeal. 3.Handing over original title documents to the
c. If an order of sale of the land was made whether the sale complied with the rules purchaser
4.Collecting balance of purchase price from
d. Whether the vendor is a personal repair beneficiary in a probate dispute which the purchaser
5.
entitles him to convey the person. On the part of the purchaser, it is
1.accepting the title
2.tendering the engrossed conveyance
INQUIRY ON COMMUNAL AND FAMILY LAND 3.the payment of the balance of purchase price
4.Collecting original title documents from the
a. Inquire on whether consent of the principal members and family head has been vendor
5.Taking possession.
granted
b. Whether the vendor has the right to sell the land. ITEMS TO BE COLLECTED ON
COMPLETION BY THE PURCHASER
c. Whether there exists any customary inhibition against his right to see FROM THE VENDOR
1.At least five (5) copies of the duly executed
deed (with plan attached)
2.All prior original title documents which
PHYSICAL INSPECTION OF PROPERTY relate to the land. The exceptions are: (1)
A personal/physical visit to inspect the people may where the document relates to other land
retained by the vendor e.g. a power of attorney
1. Whether the property is being occupied relating to other land (2) creates a trust which
is subsisting (3) relates to the appointment or
2. Extent of development of the people discharge of a trustee of a subsisting trust in
which case the vendor will give an undertaking
3. Actual dimension of the land and whether it conforms to the dimension at the to safe cost and acknowledgement of the
lands registry. purchaser’s rights to production of the
document.
4. Whether there are public utilities on the land/ people eg electric poles, 3.Receipt of payment of all outgoings.
4.Keys to the property if developed.
telephone cables 5.Three (3) years Tax clearance certificate of
5. Any damage caused by natural elements eg erosion vendor
6.Duly executed form for Governor’s consent
6. The general condition of the property. (called form 1c in Lagos State)
7.Expired power of attorney where there is one
COMPLETION STAGE 8.Approved building plan
9.Notice of assignment of insurance policy
where there is one.

53
This is the stage where the parties of the transaction conclude all processes that vest
the legal title on the purchaser. This is the final stage of the transaction-KILNER
V.FRANCE
The following usually signify completion:
a. Payment of the balance of the purchase price.
b. Execution of the formal conveyance by the parties
c. Handing over of title deeds and other documents by the vendor to the purchaser
d. Taking over possession of the property by the purchaser either actual or
constructive.
e. Vesting of legal estate in the purchaser.
ARE THERE CIRCUMSTANCES WHEN TITLE DOCUMENTS ARE NOT HANDED
OVER.
Where this is the case, it is to be endorsed on the agreement that the vendor is with the
title documents. Insert a covenant to produce the title documents in the deed of
conveyance.
(SAFE CUSTODY CLAUSE)
COMPLETION STAGE(chronological steps)
a. The VENDOR’S SOLICITOR prepares and sends a completion statement to the
purchaser
b. The PURCHASER’S SOLICITOR prepares/drafts the conveyance (Deed of
Assignment)-S.73(1) PCL
NB-draft is prepared first using precedents and sent to VS for amendment.
DOCUMENTS TAKEN BY PS TO VS OFFICE-bank draft(balance)/draft
conveyance/file containing entire transaction(BDF)
c. The Deed of Assignment is executed upon payment of the balance of the purchase
price
d. The purchaser collects all the original title documents/duly executed DOA, keys
to the property if developed;receipts of tax payments/outgoings. and a letter of
introduction;if there are existing tenants on the property upon the payment of the
balance.

COMPLETION STATEMENT
 This is otherwise referred to as financial statement
 It is prepared by VENDORS solicitors involved in a sale of property.
 It is a statement of the financial commitment of the parties and any financial
obligation expected to be met towards a successful completion of the transaction.

ADVANTAGES/IMPORTANCE OF SERVING COMPLETION STATEMENTS

a. It helps the seller to decide whether to sell with regard to the expenses to be
incurred or to suspend sale until people appreciates in value.
b. It helps the purchaser calculate his financial obligations to know whether he can
continue with the transaction.
c. It helps in accountability and reduces chances of fraud being perpetrated on the
client.

54
 d. It helps in the computation of taxes e.g. capital gains tax which is 10 % of the
price a property is sold for less the expenses on the property.

POST COMPLETION MATTERS / PERFECTION OF TITLE IN SALE OF LAND

The conveyance will only act to pass interest in land where it is delivered as a deed.
To achieve this, the vendor’s solicitor is obliged at law to obtain the state governor’s
consent by virtue of S.22 of the land use act. In practice, THE PURCHASER’S
SOLICITOR
a. Obtain the Governor’s consent
b. Stamps the document ad valorem under the Stamp Duties Act.
c. Registers the deed in the state`s land registry where the deed is given a
registration number.
B. Application for Consent of Governor
 Where property is subject to a Customary Right of Occupancy, the consent
required is that of the Local Government where the Land is located – S. 21
Land Use Act.
 Governor’s consent is usually sought and obtained by the Purchaser’s
Solicitors. Ideally, it is the vendor who should apply for and obtain the
Governor’s consent.
NB – The Purchaser should ensure that he obtains a letter or application for consent
from the vendor. The ` forwarding the vendor’s letter.

THE DOCUMENTS REQUIRED TO PROCESS GOVERNOR’S CONSENT

1. Application for consent in prescribed form-(Land Form 1C (if the land is in Lagos)
2. Covering letter Comment [g24]: draft
3. Tax clearance certificate of both parties(3 YEARS preceding)
4. Certified true copy of vendors title documents
5. 6 copies of the executed deed of Assignment containing undertaking to pay GOVT
levies
6. Receipts of payment of;
a. tenement rate(developed)
b. ground rent ;stamp duties etc
c. development levy
d. inspection; charting and consent fees.
7. Attach copy of approved building plan(developed property)
If a company is any of the parties, the following documents must be attached:
8. A CTC of the Certificate of Incorporation of the company
9. CTC of the Memorandum of Association
10. CTC of the Particulars of Directors of the company
11. Tax clearance certificate of at least two directors
12. Evidence of PAYEE returns for its staff
13. A Resolution of the company approving the transaction
NB The procedure obtained in Ogun State, Lagos.

55
However in Lagos Form I C ie Land Form is filled and a certificate cheque of the
consent fee is made between 7 – 7½ % of the value of the property.

PROCEDURE FOR APPLYING FOR CONSENT IN ABUJA

a. A written application letter addressed to the Minister of FCT by the vendor
consenting to the alienation
b. Inspection and valuation of the land is conducted.
c. Payment of consent fee of N5000
d. Payment of ground rents
e. Processing fee of N5000(residential plots) &6000 (commercial plots
f. You may pay Title Registration fee if you are not (vendor) is not the direct owner of
property. (5% of property value)
g. Original of title deeds for citing and the counterparts

THE EFFECTS OF A FAILURE TO OBTAIN GOVERNOR’S CONSENT ON LEGAL

TRANSFER OF INTEREST IN LAND ARE AS FOLLOWS:
1. The legal transfer of interest is void but however the entire transaction is not void.- S.
22 of the Land Use Act
2. The Assignee/ Mortgagee only have an equitable interest on the property.

B-STAMPING
 The amount to be paid as stamp duty may be fixed fee or ad valorem charge
(i.e. based on the value of the transaction).
 Stamping of documents which are charged ad valorem is to be stamped
WITHIN 30 DAYS while others are to be done WITHIN 40 DAYS of its execution.
-S. 23 of the Stamp Duties Act.

THE EFFECTS OF A FAILURE TO PAY THE STAMP DUTIES ON DOCUMENTS TO

BE STAMPED ARE:
1. The document will not be acceptable for registration, S. 9 & 10 of the Land
Instrument Registration Law of the States.
2. The document is not admissible in evidence in Court
3. There will be payment as penalty for late stamping of the document-s.22 SDL
(Lagos);OGBATION V.REG.TRUSTEES CCCG
NB- EXAMS-Stamp duties in respect of land matters are paid to the states.

THE STEPS TOWARDS STAMPING OF DOCUMENTS :

1. Original Document is delivered in triplicate to the stamp duties commissioner for
assessment.
2. The assessed duty is paid and receipt is issued
3. The instrument is impressed with a red-ink(sstamp duty paid or duty stamped)
4. The rate of duty payable is between 2-3 % of the value of the transaction

56
 C- REGISTRATION
A conveyance is a registrable instrument
Must be done within 60 DAYS of execution
The importance /effect of registration of transactions transferring legal interest in land
are:
1. It serves as constructive notice to subsequent dealers on the interest already
transferred
2. The instrument is admissible in evidence

THE EFFECTS OF A FAILURE TO REGISTER SUCH TRANSFER OF LEGAL

INTERESTS IN LAND ARE:
1. The instrument cannot be pleaded in evidence to prove title-s.15 LIRL
2. It has no priority over subsequent instruments registered over the same legal
transfer of interest-S.16 LIRL
3. It does not serve as notice to third parties dealing on the same interest
4. Renders instrument void-S.5 RTL;S.14 LIRL
ONASHILE V.BARCLAYS BANK LTD

THE PROCEDURE FOR REGISTRATION:

1. Deliver in duplicate,2 duly stamped and executed copies of original deeds to to the
deed registrar in the
2. The Registrar collects the deeds and registers it in the Register of Deeds on a
particular volume, on a particular page with a particular number;
No. …………………. At Page ………………. In Vol. ………………of the lands
registry___________________
3. An endorsed copy of the original deed is given back to the Purchaser, while the
Counterpart is kept at the Registry. –AMADI V. ORISAKWE
Two copies of the original Deed dully executed and stamped are to be forwarded to the
Deed Registrar in the Lands Registry of the State
2. The Registrar receives same
3. One of the original Deed will be given back to the party carrying out the registration
while the other copy will be kept by the Registrar

WHEN THE SUBMISSION OF A SURVEY PLAN IS UNNECESSARY IN

PERFECTING TITLE ARE AS FOLLOWS: -S.9 LIRL/LRA
A survey plan signed by a licenced surveyor must be attached to a conveyance for a
proper and sufficient description of the property to be assigned. Comment [g25]: Q4(B)II-APRIL1998

EFFECT OF NOT ATTACHING SURVEY PLAN- the Registrar has the discretion to
refuse to accept the Deed for registration for not been attached with a survey plan
EXCEPT
1. When the Deed of Assignment to be registered referred to an earlier Deed which
contained a survey plan

57
2. If it is a transfer under the Registration of Titles Law of Lagos State, there is no need
to attach it as the particulars of the property are already contained in the Register of
Titles.
3. Where there is a parcel clause or schedule containing the particulars of the survey
plan .

ETHICAL ISSUES
1. Rule 23(2) Rules of Professional Conduct 2007 -A Lawyer should keep a
separate account. Should not mix his money and clients’ money.
2. R. 47 A Lawyer should not search the land Registry for Defect with view to
employment or litigation
3. Rule 15(1),2a,3a,e,i,j.
4. R. 10 Duty not to frank a document unless seal and stamp of NBA is affixed.
5. R. 3 Duty not to aid unauthorized practice of law.
6. R. 3(2) Duty not to sign a document prepared by a non-lawyer
7. A lawyer should not under stamp ie reducing the consideration stated on the face
of an instrument in order to reduce stamp duty. This comes under a lawyer’s duty
to knowingly engage in illegal conduct R. 15(2)(j).
8. R. 16 Represent client competently, know the appropriate documents to prepare.
9. R. 14(1) (2) (5)a – d Duty to keep client informed of progress of transactions, give
warnings and cautions where necessary.

CLASS ACTIVITIES
1. What is the effect of failure to investigate title?-Where investigation is not conducted,
the Purchaser buys subject to any defect in title.
2. What is the difference between failure to obtain Governor’s consent because it was
applied for and refused and not applying at all
ANS-Where Governor’s consent is sought for and refused, the transaction is invalid,
null and void. Where no attempt has been made at obtaining the Governor’s consent,
the transaction is inchoate, incomplete or voidable and it becomes complete upon the
obtaining of the Governor’s consent. AWOJUGBAGBE LIGHT INDUSTRIES V.
CHINUKWE

EFFECTS OF GOVERNOR’S REFUSAL

Where the refusal of Governor’s consent is not reasonable, it can be actionable – Shitta
Bey v. FPSCC.
The Governor may delegate the power to grant consent to a Minister or Director or other
officer in Lands Ministry through a Gazette

TAKE NOTE:
In most jurisdiction Governor’s consent and registration are done simultaneously.
An unstamped document cannot be registered, thus you apply for stamping first
before applying for consent or Registration.

For exam The order is, consent, stamping and Registration CSR.
58
See sample draft of a Search Report on the search conducted on a property below:

DOHERTY FUBARA & CO

BARRISTERS AND
SOLICITORS NO. 15 BRACE
STREET OGBA IKEJA -
LAGOS STATE.
OUR REF:
DATE: 10 APRIL 2012

To
Professor Udo
Ekanem Dolphin
Estate Ikoyi Lagos
State.

Dear Sir,
SEARCH REPORT ON PROPERTY REGISTERED AS 21/21/2011
AT THE LANDS REGISTRY SAPELE DELTA STATE.
Sequel to your instruction to our firm to carry out a search on the above property,
we are pleased to inform you that we have successfully carried it out and attached
below is a copy of the Search Report.

1. DATE OF SEARCH: 15th April 2012

2. PLACE OF SEARCH: Lands Registry Sapele Delta State.
3. NAME OF OWNER: Mrs. Aduke Thomas
4. NAME OF VENDOR: Mrs. Aduke Thomas
5. NATURE OF INTEREST: Certificate of Statutory Right of Occupancy dated
15/05/1999 No. 12145 and registered as 21/21/2011B at the Lands Registry
Sapele Delta State.
6. DESCRIPTION OF THE PROPERTY: four blocks of flats at Sapele Delta
State at No. 15 Bingo Street Sapele Delta State.
7. ENCUMBERANCES: Nill
8. COMMENTS: The property has a good root of title.

Yours faithfully,

Okon Taiye Esq.

For: Doherty Fubara & Co

59
 WK 8: REGISTRATION OF TITLE
The system of registration of title operates in certain parts of Lagos State.
The regulating legislation is the Registration of Title Law Cap 166 Laws of Lagos
State 1994 (now Cap. R4 Laws of Lagos State 2003). This law was first introduced to
Lagos in 1935. Transactions under this system are conducted by the uses of FORMS.

THE REGISTRATION DISTRICTS IN LAGOS ARE:

Lagos Island, Victoria Island, Shomolu, Ikoyi, Yaba, Apapa, Surulere, Ebutte-Meta,
Oshodi, Badadry, Agege, Maryland, Obalande, iddo, idumagbo, parts of mushin,-s.2
RTL

NON-REGISTRATION DISTRICTS
LEKKI/IKEJA/ALIMOSHO/KOSOFO LGA

OBJECTIVES OF THE RTL

a. To establish a single Register of title to land which is guaranteed by the State
b. Ownership of title to land is to be based on the fact of registration
c. To curb the risks of delay and expenses in unregistered conveyancing
practices
d. To simplify conveyancing practice

THE REGISTRY OF TITLES

A land Registry is established for record and keep information on registered titles and
dealings in them.
This Registry is headed by the Registrar of Titles who is assisted by Deputy
Registrars and Assistant Registrars.
The registry is private and confidential as investigation of any title in the register can
only be conducted by the owner of the title or a person authorized by him S. 74(2) RTL.

A register of Titles is maintained by the Registrar with records of rights and limitations
attached to clearly defined land vested in a person or body.

WHAT CONSTITUTES TITLE OF THE PROPRIETOR

The entries in the registry

LAND CERTIFICATE
 Issued on registration
 Not document of title
 Reflection of entries in register
 Deposited upon sale
 Exchanged upon charge for charge certificate
CONTENTS-Extracts from the register; details; title No; district

60
DIVISION OF THE REGISTER
a. PROPERTY REGISTER contains a detailed description and other information of the
property that is registered e.g. dimensions, location, ownership of minerals –
easement, conditions.
b. Proprietorship Register: Captures the particulars of the Registered owner of the
property eg name, address and description
c. CHARGES REGISTER: Contains details of any charge, mortgage and
encumbrance that may have been created over a particular property e.g.
encumbrances subsisting at the date of registration, subsequent charge notes
relating to covenants, conditions, adversely affecting the land.

CATEGORIES OF REGISTRATION
1. First Registration
2. Subsequent Registration

PROCEDURE FOR FIRST REGISTRATION

a. A person is to make an application to the Registrar to be registered as first owner
using FORM 1
b. The Registrar will investigate the title to the land through may be evidence that
substantiates a good root of title of the applicant. –s.8(1) RTL Comment [g26]: application to land registry
investigation by the registrar
c. The Registrar must put up an Advertisement of the application in the State Gazette advertisement of the application
and in one or more newspaper circulating in Nigeria. S.8(2).The Registrar may also approval and entry into register-SECTION 8&9
RTL
serve on occupiers or owners of adjoining land, the application made for
registration. (FORM 2)
d. The Registrar waits for a PERIOD OF TWO MONTHS for an objection to the
application for registration. Where any objection is received, the registration will be
suspended – S. 8(4) RTL If the objection is upheld, the application for registration
will be dismissed.
e. If after investigation of an application for registration, the Registrar is satisfied that
the applicant is entitled to be registered as the owner of the land claimed, he will
be registered accordingly. However, where the Registrar is not satisfied with the
evidence of the title he will dismiss the application for registration. OBJECTIONs
are FORECLOSED-BALOGUN V.SALAMI.
NB – The Registrar is not under obligation to accept and register any document seeking
to prove first or subsequent title. He must first require evidence to ascertain the
authenticity of the documents presented for filing – S. 70(1) RTL.

The applicant or objector has a right to appeal against the Registrar’s decision to the
High Court.

The Registrar shall issue to the registered owner of any land or charge a CERTIFICATE
OF TITLE (sometimes called Land Certificate) which contains all entries in the
register affecting the land.

61
 The legal status of the certificate is that it is prima facie evidence of the several matters
contained in it S. 55(5) RTL.

APPLICABLE FORMS UNDER THE RTL

The forms are contained in the Schedule to the RTL and are altogether 18 forms
FORM 1 Application for First Registration
FORM 4 Lease and sub-lease
FORM 5 Charge and sub-charge (legal mortgage)
FORM 7 Transfer of Title (Assignment)
FORM 10 Restriction on Registered dealing
FORM 15 Notice of Mortgage by Deposit (equitable)

EXTENT OF COMPLIANCE WITH THE USE OF FORMS (MODIFICATION OF FORMS)

S.79 RTL-forms are directory not mandatory
Can an applicant modify the form?
Previously, the Courts were of the view that the Forms in the schedule to the RTL were
sacred and parties could not on their own modify them in transactions under the law in
Owumi v. P.Z. Ltd and Shell B.P. v. Jammal Nig. Ltd; the Supreme Court in both cases
voided transactions which did not comply with the FORMS.
However, in Bucknor – Maclean & Anr v. Inaks Ltd, the
current position in that where there is a minor deviation from the contents of the FORM, it
is a mere irregularity which will not vitiate the transaction.
Nb- The registrar has a discretion to accept or refuse the document
Once the Registrar has accepted such as instrument for registration and has in fact
registered it, the Registrar’s acceptance and registration of the modified FORM is
conclusive of its sufficiency in point of form. -
NB = FORMS under the RTL do not require to be sealed in order to be effective as deeds
– Section 80 RTL

INVESTIGATION OF TITLE UNDER THE RTL-S.31 RTL

1. Proprietors letter of authority or affidavit by purchaser showing consent
2. A statutory Declaration by the proprietor as to the existence or otherwise of
encumbrances.
3. Application letter to conduct search
4. A copy or CTC of the title document ie land certificate
5. A statutory declaration to the existence of incumbrances if any
- Submit the documents to the Registry
- Make the appropriate payments
- The staff of the Registry will conduct the search and make a Search Report.

PROCEDURE FOR SUBSEQUENT REGISTRATION

1. Applicant must obtain Governor’s consent
2. Document must have been stamped
3. The original land certificate must be attached and endorsed

62
 4. Notices are issued to the parties to the transaction and the registered owner of any
interest on the property.
5. These notices are posed by registered mail
6. If no objection is RAISED AFTER 14 DAYS, a draft entry is prepared and approved
by the Deputy Registrar or the Registrar.
7. A new Land certificate is typed reflecting the new transaction.
8. The new land certificate is signed by the DR or Registrar of Titles
9. The applicant collects the new Land Certificate
NB = This procedure is for registering transfer, Assignment, leases

Advantages of transactions UNDER THE RTL

1. Ease of title investigation-ONAGORUWA V. AKINREMI
2. The process ensures privacy and avoids mutilation or alteration of files/documents.
s.74(2) PCL
3. Title is more reliable in Lagos under the RTL because the State carries out
investigation of the title before registration.(security of title)
4. It is cheaper as parties only need to complete forms.
5. Streamlines land administration
6. Indefeasibilty of title for a subsequent registered owner.

Distinction between Registration of Title and Registration of Instruments

Registration of Title Registration of Instruments
1. This is regulated by the Registration This is regulated by the Land
of Titles Law Instrument Registration law.
2. Entries in the Register are Vendor is required to deduce his title
conclusive proof of title; an epitome or through epitome or abstract of title
abstract is not required to deduce
vendor’s title
3. Registrar of title must investigate the Registrar does not investigate the title
title before registration
4. It is the TITLE which is registered The Registrar merely registers the
under RTL INSTRUMENT.
5. Transactions is by use of FORMS Traditional documents are used e.g.
Deeds
6. Registry is private thus consent letter Registry is not private; thus consent
is required to conduct a search letter is not required to conduct search
7. Certificate of Title is issued after Title Deeds is issued after registration
registration
8. The State guarantees title of every The state does not guarantee title.
registered owner

PERFECTION OF TITLE UNDER THE RTL

1. Obtain the Governor’s consent
2. Stamping of the Prescribed Forms
3. Registration to be done WITHIN 2 MONTHS otherwise it is void.
Note that upon perfection of title, a new Certificate of Title will be issued as proof of
perfection.

63
 RECTIFICATION OF THE REGISTER OF TITLE UNDER THE RTL-S.61 RTL
The Register of Titles may be rectified by the Registrar or the Court by issuing an Order
to that effect on any of the following grounds:
1. Errors were made on the entry and an application was made for its correction by the
aggrieved person
2. Where all the persons interested in the land consents to the Register been rectified
3. On the grounds of fraud in order to undo the fraud
4. Where there is a new transaction registered
5. Where an entry is made containing two different owners

THE EFFECT OF REGISTRATION AND INDEFEASIBILITY OF

TITLE UNDER THE RTL
It is established that once a land has been registered and a Certificate of Title issued to
the owner, the title to the land is hence indefeasible as no defect to the title of the land
can vitiate the proof of ownership.
However the extent of its application varies and the title may be set aside.
It depends on the type of registration and when it was done as follows:

(A.) FIRST REGISTRATION

If the title to the land was obtained by fraud or upon forged dispositions, it would be
void even after the registration of title. This is because the rule of nemo dat quod non
habet applies. S. 48(3) of the RTL and YESUFU V. OJO; ANIMASHAUN V. MUMUNI
Thus title under a first registration of title which is defective or fraudulent is not
indefeasible.

ALL SUBSEQUENT REGISTERED OWNER (OR PURCHASERS OF REGISTERED

TITLE):
A purchaser of a registered title under the RTL has more protection as his title is
indefeasible. The title is also not affected by Notice If it is a bona fide purchaser for
value.
S. 53(2) & 54 of the RTL and ONAGORUWA V. ADEREMI.

TYPES OF INTERESTS UNDER THE RTL

1. REGISTERED INTEREST
Under this, it may be interests that must be compulsorily or voluntarily registered
The interests that must be registered are:
a. Estate in fee simple (assignments of land)
b. Leases from 40 years and above for consideration or part consideration
c. Assignment from 40 years and above S. 5 of the RTL
Those permitted or voluntary registration include the following:
a. Leases for more than 5 years
b. Certificate of Occupancy, Power of Attorney, Mortgages, Charges etc
NB: a conveyance by way of gift is not required to be registered as there is no
consideration paid. S.6 & 7 of the RTL.

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 3. OVERRIDING INTERESTS
Overriding interests are third party interests that are subsisting in reference to the
property, such interest are not registered in the register but subject to which the
purchaser of a registered title takes his title for they are binding on him.
S. 52 of the RTL and ONAGORUWA V. ADEREMI. Thus persons dealing with
registered land must also obtain information outside the Register – NATIONAL
PROVINCIAL BANK V. HASTINGS; WILLIAMS &GLYN’S BANK V. BOLAND
S.52 RTL lists items which are overriding interests to include
1. Easements
2. Rights, privileges or appurtenances appertaining to any other land.
3. Rights of entry, search, users and other rights required for the enjoyment of
rights to mines, minerals and mineral oils.
4. Any permit to survey or oil pipeline licence
5. Leases or agreements for leases for a TERM LESS THAN 5 YEARS where
there is actual occupation
6. Any public highways
7. Any tax or rate declared by law to be a charge on land or house
8. Rights acquired or in process of being acquired under the limitation law
9. The rights of every person in possession or actual occupation of the land.

MINOR INTERESTS
These are interests not capable of been disposed of and may not reflect in the Register
of Titles to land. However, the purchaser of a registered title will take his land free of
them EXCEPT they are registered as Notices.
The minor interests may be protected by filing any of the following Notices which are:
a. Caution
b. Restriction
c. Inhibition and
d. Notice

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 WEEK 9&10-LEASES
DEFINITION-a document creating an interest in land or a property for term of years
certain usually but not always in consideration of payment of rent.
-interest created is also reffered to as a lease.

REVERSION
Reversion is the interest which remains in the granter after the grant and
expiration of the term in future. The reason for a reversion is because a lease cannot
ensure in perpetuity.
Thus, in every lease, the lessor has a reversionary interest.

PARTIES-TO A LEASE
The owner of the properly who makes the grant is the LESSOR/LANDLORD
The person who takes over the exclusive use of the properly is LESSEE/TENANT..
HALLMARKS OF A LEASE
EXCLUSIVE POSSESSION GIVEN BY THE LESSOR TO THE LESEEE WHILE
OWNERSHIP OF THE DEMISED PROPERTY REMAINS WITH THE LESSOR
ANDCERTAINTY OF TERM

FEATURES OF A LEASE
a. A lease is a grant of a term above 3 years, thus must be by deed.
b. The title to the Land is not conveyed, only the use and occupation is transferred
c. The relationship is for a fixed or definite period
d. The Lessee may subject to conditions stated in the agreement assign his interest or
sub-lease part of his interest to another person.
e. Rent is usually but not necessarily paid by the lessee for the use and occupation of
the property.
f. There is a right of reversion of the property to the lessor.

TYPES OF LEASES
1. Leases for fixed period
2. Periodic tenancies
3. Yearly tenancies
4. Tenancies at will
5. Tenancies at sufferance- A tenant at sufferance is one who entered the premises
lawfully through a valid lease agreement but over stays after the expiration his
tenure.
6. Statutory tenancies

CREATION OF A LEASE
1. ORAL/PAROL LEASE:
A parol or oral lease is not in writing.
It is permissible under S.3 STATUTE OF FRAUDS 1677;s.79(2) PCL;FOSTER
V.REEVES

66
ESSENTIALS OF AN ORAL LEASE.
a) It must take effect in possession
b) It must reserve the best rent (not premium or rack rent i.e. the rent must not
be paid in advance or in lump sum)
c) It must be for a period not exceeding 3 years.

DISADVANTAGE-The drawback with oral lease is the difficulty of proving the essential
terms agreed to by the parties; for “a party alleging and oral agreement is duty bound to
prove such as agreement to the hilt.-ODUTOLA V. PAPERSACK (NIG.) LTD;
EKPANYA V. AKPAN;

2. WRITTEN LEASE /TENANCY AGREEMENT

This is a written agreement applicable to leases not exceeding 3 years.
It need not be under seal. –S.4 STATUTE OF FRAUDS 1677
It is signed in the hand of the parties only.
A written lease is binding upon the parties as a contract and is enforceable.
FORM-may be for a fixed period
May be weekly, monthly, quarterly or yearly-AP LTD V. OWODUNNI

ADVANTAGES OF WRITTEN LEASE

a) The terms are easily ascertainable and enforceable.
b) An order of specific performance may be ordered.
c) Where specific performance falls, there can be an award of damages.
3. LEASE BY DEED
A lease could be made by deed.
It is mandatory for leases above 3 years to be by deed.
This satisfies the requirements of S. 17(1) PCL to the effect that any conveyance of
land or of any interest in land is void unless made by deed.
However, the rule in WALSH v. LONSDALE states that an agreement to create
a lease will still operate as a lease notwithstanding that it is not created under seal. This
is based on the maxim “equity looks at the intent rather than the form”.

ESSENTIALS OF A VALID LEASE

OSHO V. FOREIGN FINANCE CORPORATION AND ANOR ; INT’L TEXTILE IND.
(Nig) Ltd v. ADEREMI (
1. CERTAINTY OF TERMS:
The terms of a lease must be certain or ascertainable.
The commencement date and the expiration date must be expressly stated
RATIONALE-This is because the lease cannot enure in perpetuity- LACE V.
CHANTLER
UBA V. TEJUMOLA AND SONS LTD;
NB- The terms in the lease were held ascertainable as they were dependent on future
contingencies certain to take place. BOSAH V. OJI; OKECHUKWU V. ONUORAH.

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 EFFECT OF UNCERTAINTY OF TERMS IN A LEASE
 A lease that will commence when the first daughter of the family gets married is
uncertain; thus void.
 , a lease that had no date was declared invalid- AMINU V. NZERIBE
 A lease until the landlord requires the land for widening of the road was declared
void.
PRUDENTIAL ASSURANCE CO. V. LONDON RESIDUARY BODY
 A lease for as long as the company is trading was held void BIEREL V. CAREY.
 A lease for a future lease is void UNLESS a definite time of commencement
can be inferred from it.

2. THE LEASE MUST BE CREATED IN A PROPER MANNER:
 Where it is for 3 YEARS AND ABOVE, it must be by deed.
 Where the lease is for a term BELOW 3 YEARS; it may be by agreement under
the hand of the parties. This may be simply called a TENANCY AGREEMENT.
NB-S.4 STATUTE OF FRAUDS;S.67 PCL;S.5(LAW REFORM (CONTRACTS) LAW
CAP 114.

3. EXCLUSIVE POSSESSION:
The lessee must have the right to exclude every person from the property including the
lessor or landlord, EXCEPT for the conditions that the landlord may enter the property
for repairs.-UMEZURIKE V.GEORGE. . A document that purports to be a lease, but
does not confer exclusive possession is not a lease. CLORE V. THEATRICAL
PROPERTIES LTD

4. CERTAINTY OF PROPERTY:
 The property in a lease must be described with specific dimensions.
 Address should be clear not vague
5. CERTAINTY OF PARTIES: The parties to a lease must have capacity to
contract the lease agreement. The parties may be natural or juristic persons.-
UBA v. Tejumola & Sons Ltd.
Parties must be sufficiently described-ODUTOLA V. PAPERSACK (NIG.) LTD
DISTINCTION BETWEEN LEASE AND ASSIGNMENT
LEASE Assignment
1. May not be created by deed Always created by deed
2. Only possessory interests Proprietary interest is transferred
transferred(main)
3. Leasor retains reversionary interest in
The entire interest in the apply is
the apply assigned
4. Needs no investigation to prove titleVery important to investigate title of
assignor.
When a lease is assigned, all covenants in the head-lease remain binding on the
parties to the sub-lease. However, when a Deed of Assignment is assigned, only
the covenants that touch and concern the land are binding on the parties to the
assignment because there is no privity of contract.
 AN ASSIGNMENT is the grant of the remainder of the term in a lease -
NWANPA V. NWOGU (2006) 2 NWLR (PT.964)

68
DISTINCTION BETWEEN A LEASE AND SUB-LEASE
LEASE SUB-LEASE
1. There exists a direct relationship There is no direct relationship the
between the lessee and the lessor head-lessor and the sub-lessee
DISTINCTION BETWEEN LEASE AND LICENCE
LEASE LICENCE
1. transfer of interest in apply There is no transfer of interest
2. Lessee has exclusive possession Licensee has no exclusive
possession
3. Interest is transferable through a sub- No such right
lease
4. The demised estate can survive the Death of the granter of license
death of the parties terminates the relationship
5. Lessee can maintain an action in Licence cannot maintain an action
trespass against 3rd parties in trespass
6. A lease is entitled to the statutory A licencee is not so entitled.
Notices

NB => A licence is a mere permission/ personal privilege given by the occupier of

land to a person to do an act upon his apply which otherwise will amount to
trespass.ISHOLA WILLIAMS V.HAMMOND PROJECTS
The absence of exclusive possession transforms a lease to a license, which is a
personal privilege to use the property without owning any interest in it. Possession
ceases to be exclusive only where another person is on the land lawfully. Olukoya
v. Ashiry.
A licence does not create proprietary (ownership) rights STREET V. MOUNTFORD
ELOICHIN LTD V. MBADIWE

RENT IN LEASE
DEFINITION-Rent is the consideration paid by the tenant for the use and enjoyment of
the landlord’s properly.
 Rent may be money or money’s worth. -S.47 LSTL 2011-Wide definition of
rent;-PITCHER V. TURKEY rent was paid with bottles of wine in DOE EDNEY V.
RENHAN RENT was equated with cleaning the parish church.
 Rent must be certain or ascertainable.
 Almost all the states of the federation except the FCT have regulations
controlling rents charges in Nigeria
 Rent is not mandatory in leases.
 Rent should be made an essential requirement in the agreement as the court will
presume the subsistence of a lease agreement between the parties even without
the payment of rent- OSHO V. FOREIGN FINANCE CORPORATION
 Rent is still payable even if the premises cannot be used. E.g. due to
destruction by fire. This is because the doctrine of frustration hardly
applies to leases. E.O. ARAKA V MONIER CONSTRUCTION CO (NIG) LTD

69
  Note that rent is not due until the expiration of the period created. In a monthly tenancy,
the rent is due on the eve of the commencement of another periodic month.-RE ST
ANDREWS ALLOTMENT ASSOCIATION(Abuja only )(LAGOS IS BEFORE OR
AFTER THE EXPIRATION.
 The main feature of a lease is lawful occupation by tenant and whether he pays
regular rent, subsidized rent or no rent at all is immaterial – AFRICAN
PETROLEUM LTD. V. OWODUNNI.

TYPES OF RENT
a. GROUND RENT:
 This is the rent paid on the bare Land itself i.e. ground whether or not it is
developed. Payable to government upon grant of a statutory R of O-S.5(1)
Land Use Act 1978
 The ground rent is subject to revision for periodic 5 years
 in a traditional setting, kolanuts and palmwine may suffice for ground rent.
b. RACK RENT: It is the economic rent payable for the land and the
improvements and developments on the land. Which represents the full values of
the property (i.e. land and development on the land).
It could be paid annually, monthly or fixed periods.
c. PREMIUM: This is a lump sum paid in addition to the other rents. It is regarded
as a fine and as such is prohibited in some states in Nigeria.-S.3&4 Rent
control and Recovery of premises Law 2003 and S.4 LSTL 2011

MODE OF PAYMENT OF RENT

It must be indicated in the agreement
It can be in arrears or in advance
G.B OLIVANT V. ALAKIJA
NB = > Rent is payable in arrears the parties agree otherwise.
 Once the parties have agreed to the sum to be paid as rent neither party can
unilaterally alter it. YAHAYA V. CHUKWUMA (2002)3 NWLR (PT 753) 20
CIRCUMVENTION OF PREMIUM
Landlords attempt to circumvent the prohibition of premium, by charging rent in
advance for many years. it is lawful to insert a clause demanding an advance payment
of yearly rent which does not exceed a year for yearly tenant.-S.4(1) LSTL

LEGAL CONSEQUENCES FOR RENTS PAID IN ADVANCE.

a. Inflation: A lessor who collected many years rent in advance may turn out to be
at a disadvantage as the value of the money be may greatly reduced as a result
of inflation.
b. Tax Implications: Rent collected in advance for more than 5 years is subject to
taxation as income.-S.(2)(c) Income Tax Management Act.;S. 3(2) c-Personal
Income Tax Act,2004
c. Legislative restrictions-Must not be in excess of one year for a yearly tenant or
6MONTHS For a monthly tenant-S.4 (4)LSTL(attracts criminal liability)-
70
 RENT REVIEW CLAUSE-
The import of this clause is to enable the landlord to review the rent periodically.
The right to review must be expressed as a condition in the agreement. I
The landlord cannot unilaterally review the rent.
In the absence of such clause, and subsequent disagreement, the court may imply fair
market or reasonable rent and this would always be a matter of evidence. UNILIFE
DEVELOPMENT CORP. V.ADESHIGBIN
A rent review clause may be inserted in the REDDENDUM or it may be referred to a
schedule.

PURPOSE OF A RENT REVIEW CLAUSE

This review enables the landlord to keep up with the prevailing market rates.
This is usually because the value of a landed apply keeps on appreciating with time.

CONTENTS OF A RENT REVIEW CLAUSE-

A rent – review clause should contain the following:-
a. Method of initiating the review (notice/time frame of notice)
b. Period of the review (when it is renewable and date when it is payable).
c. Valuation formula-The method of calculating the new rent .g. by expert
valuation.
d. Conflict resolution provision-OLANIYAN V. SHOKUNB
.
APPLICATION OF THE TENANCY LAW OF LAGOS STATE 2011 TO LEASE
TRANSACTIONS
SCOPE-S.1(1)LSTL
This law applies to business and residential premises only. Comment [g27]: Note that the applicable
Law in the above places is the Common Law
THE LAW DOES NOT APPLY TO on leases/ tenancy.
o Ikeja GRA ;Victoria Island ;Ikoyi ;Apapa –S.1(3) Also the Common Law is applicable to the PCL
and CA States in the absence of a State Law
o premises used by Educational Institutions for its staff and students regulating leases/tenancy
o hospitals(public or private)-;emergency shelters; mental health facility; Comment [g28]: AIVI-AKI IS VERY
IGNORANT
care or hospice facility; physio therapy centers-S.1(2) LSTL

JURISDICTION:
Both the magistrate court and the High court have jurisdiction to entertain matters
brought under this law.S.2 LSTL
The determinant is the amount of money involved in the case. Where the claim exceeds
the monetary jurisdiction of Magistrate then the case goes to the High court.
NB-S.28 MCL 2009-Annual rental value now 10 million naira.

FEATURES OF THE TENANCY LAW

1. Empowers the court to refer of tenancy proceedings to citizen mediation
centre or the Lagos multidoor court house with or without parties consent-S.32
LSTL

71
 2. Rent in advance is unlawful. It is unlawful for the landlord to demand for rent in
excess of 6 months for monthly tenancy or in excess of one year for yearly
tenancy – S.4. This is punishable with N100,000 fine or 3 months
imprisonment.-s.4(5) LSTL
3. Mandatory issue of rent payment receipt to the tenant upon payment of rent.-s.5
LSTL. Where the landlord fails to issue such receipt it is a violation of the law.
This is punishable with N100,000 fine or 3 months imprisonment.-S.5(3)
4. Service charge,etc should be covered by a separate receipt-S.10 LSTL
5. Definition of rent is wide as it includes kind and labour-S.47 LSTL
6. A licencee who refuses/neglects to give up possession requires 7 DAYS
notice(FORM TL4-s.14 LSTL
7. Professional fees of any agent is payable by party bringing him-S.11 LSTL
8. The landlord has to ensure that the tenant enjoys quiet possession –S.6 LSTL Comment [g29]: Here the law envisages a
tenant not a. licencee.
In a lease, the lessor must notify the lessee
QUESTIONS ASKED IN CLASS before entry to inspect apply where as this is
not so in licence.
1. Are lodgers, Boarders in exclusive possession?
In a strict sense of the term; we can say that lodgers and Boarders are not in
exclusive possession because the servants/workers of the Landlord can come in at
anytime clean the rooms without restrictions.
2. What is the difference between Exclusive possession and Exclusive occupation.
 One may have exclusive possession without being in exclusive occupation.
E.g I. Where MR. A. leases a house to MR. B. gives the house to his mistress. The
mistress merely has exclusive occupation. Since the lease is in the name of MR. B;
MR. B. has exclusive possession but its not in exclusive occupation.

 One may be in exclusive occupation without having exclusive possession.

E.g.II: The landlord to apply lives downstairs and the tenant lives upstairs. The
landlady keeps interfering with the occupation of apply by the tenants. Thus, the
tenants are in exclusive occupation and not exclusive possession.

NOTE THE FOLLOWING

 The lessor is under no obligation to show absolute title
 The lessees has no right to call for the title to the reversion-S.13 CA;S.70(2) PCL
 Leases or tenancies must be properly documented.

WHO PREPARES A LEASE/TENANCY AGREEMENT

The landlord’s solicitor

WHO SHOULD PAY SOLICITORS FEES

This can be paid by landlord or tenant depending on the express agreement of the
parties
DRAFT-‘’the tenant covenants with the landlord to pay all cost and expenses incidental
to this agreement including all solicitors fees for the preparation, engrossement

72
stamping,endorsement of the lease plus stamp duty and all registration fees as
assessed.

COVENANTS IN LEASES
These are agrements creating obligations usually in a deed.
NATURE OF COVENANTS
Positive covenants-stipulates the performance of an act or payment of money
Negative/restrive covenants-forbids doing of an act or acts.
FACTORS GUIDING CHOICE OF COVENANTS TO BE INSERTED IN A LEASE
The type of covenant to be inserted into the lease depends on
i. The type of lease
ii The nature of the property
iii Practice within the jurisdiction
HOW TO DRAFT COVENANTS-Using good precedent books

TYPES OF COVENANTS
1. Implied covenants
2. Usual covenants
3. Express covenants

1. IMPLIED COVENANTS
DEFINITION-Essential covenants implied by law whether the lease or tenancy
agreement makes provision for them-ADOLLO V.ADEYEMI;WARREN V. KEEN
IMPLIED COVENANTS ON THE PART OF THE LANDLORD/LESSOR
1. Quiet enjoyment ie not to disrupt tenant from enjoyment of the people
2. non derogation from grant/title
3. Property must be fit for human habitation
4. Compliance with relevant laws guiding recovery of premises(notices) Comment [g30]: QNFC-Queen Nonye fried
coconut

IMPLIED COVENANTS ON THE PART OF THE TENANT

1. Payment of rent
2. payment of rates and taxes-NEPA/PCHN
3. Covenant not to commit waste
4. Keep and deliver the premises in a tenantable condition-WARREN V. KEEN
5. Allow landlord to renter premises for repairs-S. 64 Registered Land Law Lagos
1994

2. USUAL COVENANTS
 Usual covenants are proper and common covenants inserted in a lease based on
the facts or evidence presented before the court
 Implied by legislations-s.34(1) LANDLORD AND TENANT EDICT OF RIVERS
STATE
 May be expressly provided for in the lease-this lease is subject to usual
covenants

73
  usual covenants must however be reasonable.

FACTORS DETERMINING USUAL COVENANTS IN A LEASE

1. Judicial interpretation
2. The jurisdiction of the property
3. Purpose and usage of trade for which the people is let
4. The custom of the locality where the property is situated.
5. Previous dealings
6. The type of lease in question
7. The nature of the people
Usual covenants include
1. quiet enjoyment of the property
2. payment of rent
3. payment of taxes except those expressly stated to be payable by the Landlord
4. maintain and deliver up property in a good state of repairs
5. allow Landlord view the state of repairs Comment [g31]: QRTMV-Queen rita took
mikes vaseline

C-EXPRESS COVENANTS Comment [g32]: NB:

Express covenants are covenants which will not the implied in the lease or enforced by
the parties except there is definite agreement on them.
 These are the covenants agreed to by both parties during negotiations and
exchange of drafts and they are expressed in the lease agreement.
 They often incorporate both usual and implied covenants.
You may be ask to draft a standard covenant as
solicitor for either the Lessor or Lessee and
depending on the facts you are given, draft it to
suit the interest of the party you are
representing. Some of the covenants are for the
Lessor (option to renew, covenant on
abatement of rent etc) while others are for the
Lessee. Please bear this in mind while
answering a question on this topic.

CHECKLIST OF EXPRESS COVENANTS Comment [g33]: R-Rent

R- rates and taxes
1. COVENANT TO PAY RENT /RENT CLAUSE U-USER COVENANT
RATIONALE-A lease should provide for the payment of rent because rent is not one of R-REPAIR
A-ALTERATIONS(prohibiting/restrict)
the implied covenants in leases. I-INSURANCE
A-ASSIGNMENT/SUBLEASE
DRAFT- Usually CALLED REDDENDUM-‘’ PAYING THE YEARLY RENT OF D-deliver up possession
……..clear of all deductions by yearly payments in advance MNENOMIC-Rita used rice and indomie at
dubai
USEFULNESS-(BOTH PARTIES)-The rent payable method and period of payment is
ascertainable and parties cannot vary or deny agreed amount.
RENT REVIEW CLAUSE is usually inserted immediately after the rent clause
USEFULNESS-
1. Helps LESSOR/LANDLORD maximize his profit/investment in line with prevailing
economic reality and guides against effect of inflation
2. Protects LESSEE/TENANT from arbitrary increment of rent on the part of the
landlord/lessor

DRAFT OF RENT REVIEW CLAUSE (BREAKDOWN)

METHOD-The lessor and the lessee covenant that by a notice in writing to the lessor
three months before the expiration of the current lease.

74
PERIOD-The rent reserved shall be subject to review every five years for a term
equivalent to the term granted under this lease payable immediately after the new rent
has been agreed.

VALUATION-FORMULA- Subject to the agreement of the parties, the rent may be

determined by an independent estate valuer in line with the prevalent market rate of the
property.

CONFLICT RESOLUTION-PROVIDED THAT any further conflict shall be resolved by a

single arbitrator to be appointed by the parties in accordance with the Arbitration and
Conciliation Act Cap A18 Laws of the Federation of Nigeria 2004 Comment [g34]: MPVCR-(Miss prudence
values chisoro s rice)

REMEDIES FOR FAILURE TO PAY RENT INCLUDE:

i. An action in court to recover the money
ii. An action in distress- ie the seizure of the Lessee’s good to satisfy the rent
without going to court.
iii. An action for feature where contained in the lease
iv. A claim for mesne profit against a tenant at sufferance

DISTINCTION BETWEEN ARREARS OF RENT THE MESNE PROFIT Arrear of rent is

the rent payable to a landlord by a tenant before the expiration or determination of the
tenancy Mesne profit is the amount payable by the tenant to a landlord after the
expiration of the tenancy and the retention of the premises

2. COVENANT TO PAY RATES AND TAXES

 This covenants is otherwise known as covenant to pay out goings
 Usually recurrent rates and outgoings like bills, light bills, waste disposal bills
etc are to be paid by the Lessee/Tenant while non-recurrent bills like fixing of
electric poles etc are to be paid by the Lessor/Landlord.
 If there is no express covenant on who is to pay the rates and outgoings,
section 7 (2) of the Tenancy Law of Lagos will apply and the tenant is to make
all payment on rates and outgoings THAT THE LANDLORD IS NOT LEGALLY
OBLIGED TO PAY while in other States either the provision of the State law
on Tenancy or the Common Law rule will apply.
 A Party who covenants to pay rates and taxes is not deemed to be bound to pay
all new rates and taxes subsequently introduced, UNLESS the new rates and
taxes are of the same specie as the rates and taxes existing when he
covenanted to pay.SMITHV.SMITH;MILES END TOWN VESTRY V.WHITBY
 Contrary intention must be specified

WHO IS LIABLE TO PAY THE PARTICULAR RATE?

Two things are to be considered.
a. The position of the law providing for the payment on who is to pay.

75
In most cases it is the owner of the tenement that pays the outgoings. However, parties
may on their own determine who is to pay particular rates and taxes.
b. Consider whether that particular party is to continue to pay the rate.
The answer is No; unless it has been stated that even when new rates are introduced,
such person shall continue paying the rate.
NOTE-In drafting this clause, it should be made wide enough to accommodate future
goings.
DRAFT-To pay rates and taxes, levies, duties, outgoings and charges
payable now or as may be subsequently imposed on the property
whether payable by the Landlord or not.

USEFULNESS-
1. Preserves uninterrupted supply of basic amenities and services to the
property
2. Protects BOTH PARTIES from the provisions of any legislation
regulating payment of taxes on the property
NOTE-a landlord cannot bind a diplomat; foreign envoy/consular chief
representative of a commonwealth countries and their official and
domestic staff to pay rates and taxes as they are exempted by the
minister of finance-S.9 Diplomatic immunities and privileges Act, CAP
D9 LFN 2004.

NOTE FURTHER- this does not apply to official and domestic staff and
families who are
a. Nigerian citizens
b. Foreign citizens not resident in Nigeria for the purpose of
carryng out official duties-S.10 DIPA,2004

REMEDIES FOR BREACH OF THIS COVENANT.

i. An action to recover the outgoings and rates that have accrued.
ii. An action for damages
iii. An action for forfeiture and re-entry where the lease contains a provision to
that effect.

USER COVENANT
If this is not stated, the demised premises can be used by THE LESSEE for any Lawful
purpose.-DAWODU V. ODULAJA.

RESTRICTIONS ON USER COVENANTS

1. Restrictions can be found in C OF O and parties must comply with such user
covenants in title documents
2. Town planning laws and regulations- ZARD V. SALIBA

76
USEFULNESS
1. To protect against nuisance
2. Helps LESSOR control and determine use and purpose of the property.
3. To prevent use of property for unlawful or immoral purpose
4. To protect the reversionary interest of lessor
5. To ensure compliance with town planning laws and user covenants on title
documents.
ZARD V. SALIBA

DRAFT
1. The tenant covenants to use the premises for commercial or residential purposes
only
2. The lessee covenants to make use of the premises and to permit the premises to be
used for the purpose of (residence/ commerce/agriculture) only.
3. ‘The tenant covenants not to use/suffer the premises to be used for any unlawful or
immoral purposes but to use same for commercial purposes only-VEEGEE LTD V.
CONTRACT OVERSEAS LTD

POINTS A SOLICITOR SHOULD NOTE IN ADVISING CLIENTS AS TO INSERTING

USER COVENANTS
1. It does not always favour LESSOR/LANDLORD as the more restricted the use of
the property, the lower the open market price
2. It may be harsh against the TENANT.
3. A solicitor should advise client properly to avoid being held liable for professional
negligence-SYKES V.MIDLAND EXECUTORS
4. A solicitor should avoid NARROW drafting of covenant

REMEDIES FOR BREACH OF USER COVENANT

i. Action for injunction to prevent a contrary use
ii. Action for damages to compensate for misuse of the premises
iii. Action for forfeiture and re-entry if it is provided for in the lessee

4.COVENANT TO REPAIR
It is also an implied term of a tenancy that the tenant is to repair the property,
reasonable wear and tear excepted.

MEANING-Repairs mean the replacement of subsidiary parts of the premises while to

renew refers to replacement of substantial parts of whole of the premises. –LURCOTT
V. WAKELY &WHEELER

RATIONALE-To maintain the property in good condition

Note-The practice is that before a tenant enters a premises, the landlord and the tenant
will inspect the house and the inventory of items recording the state of the important
structures in the property.

77
 COMMON LAW PRESUMPTIONS
 Landlord has no liability to repair UNLESS it is agreed by the lease or implied by
statute.
 Where a premises is in disrepair at commencement of lease and lessee(tenant)
covenants to repair, it is presumed that LESSEE will yield up premises in its
repaired state.
WAYS OF CIRCUMVENTION-use of schedules or drafting devices

WHO HAS THE OBLIGATION TO REPAIR

Any of the party may carry out the repairs but it still depends on the type of repairs as
follows:
a. Structural repairs like repairs on the roof, house foundation, etc. are to be done by
the Lessor/ Landlord. S. 8(vi) of the Tenancy Law of Lagos State
b. Internal repairs like bad sinks, broken floor etc are to be repaired by the
tenant/lessee.
c. if it is a lease of short duration, the landlord has more obligation to repair.
d. If it is a lease of a longer duration, the tenant has more obligation to
repair..;DEMUREN V. PLASTIC MANUFACTURING CO
e. The LESSEE is responsible for interior parts(block of flats) while the lessor is
responsible for externalparts Ss. 64 & 65 (f – g) REGISTERED LAND LAW LAGOS

POINTS A SOLICITOR SHOULD NOTE WHILE DRAFTING

1. a covenant must be carefully couched so as to avoid onerous presumptions on
the tenant.
2. Structural repairs must be itemized in the schedule
3. LESSOR must reserve right of entry
4. The draft must exclude fair wear and tear(LESSEE)
5. The aggregate character, locality of the premises and the general nature of the
property at the commencement of the lease must be considered by the solicitor.
NB- The interpretation of a covenant to repair in metropolis is different from
interpretation of covenant to repair in a rural area.
Expressions like “tenantable repair”, “sufficient repair” “good and substantial repair” may
be used in a covenant to repair. These expressions do not have the same effect.-
LURCOTT V WAKELY & WHEELER PROUDFOOT V HART;OYENAME V SULU

DEFECTIVE REPAIR COVENANT

“To keep the premises in a good state of repair and so to deliver up possession of the
premises the end of the term. “

THE NOTICEABLE DEFECTS IN THE ABOVE CLAUSEARE:

a. It does not make provision for the landlord to enter and take inventories
b. It does not state when repairs are to start.
c. The tenant is unprotected as to fair wear and tear.
NOTE THE FOLLOWING

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 The expression Good Tenantable Repairs, Good Repairs or Good habitable
Repairs all mean the same thing.
 The phrases “Reasonable wear and tear excepted” implies that the lessee is
relieved from liability from any state of disrepair so long as the disrepairs result from a
reasonable use of the premises and the effects of natural elements.

USEFULNESS
1. Protects the premises against waste commited by the tenant(lessee
2. Protects the value of the property(lessor)
3. Preserves tenants enjoyment of the premises by maintaining same in a habitable
condition
4. Protects both parties from being subject to implied terms under statute or common
law
5. It facilitates the payment of a deposit which is refundable at the end of the term

Remedies for Breach of Covenant to Repair

This is determined by whether or not the tenant is in possession – where tenant
is in possession.
a. Serve him a notice to repair
b. Where there is a continuous default, an order for forfeiture and re-entry.
c. An action for specific performance
d. Action for damages

WHERE TENANT IS NO LONGER IN POSSESSION

a. Action for damage (to the tune of the amount needed for carrying out repairs)
b. Action for loss of rent.

WHERE THE LANDLORD IS IN BREACH, THE TENANT MAY:

a. Serve the Landlord a Notice to repair
b. Action for specific performance
c. Tenant may repair the property and claim or set off the cost from subsequent
rent.

NB: THIS HOWEVER DOES NOT MEAN THAT THE TENANT CAN WITHOLD
PAYMENT OF THE RENT OR QUIT THE PREMISES-DEMUREN V. PLASTIC
MANUFACTURING LTD.
 The tenant cannot be justified to leave the premise before the end of the term in
the lease on the grounds that the Landlord has failed to make repairs.
(DEMUREN’S CASE)
 This practically means that the tenant should not ask for a refund of his rent
where he leaves the property before expiration of term on rounds of the Landlord
not repairing the property.

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DRAFT
“The tenant covenants to keep and maintain the
premises in a good state of repair, fair wear and
tear excepted and to permit the landlord to enter at
reasonable times to view the state of repairs’

5. COVENANT NOT TO MAKE ALTERATION

 Alterations include additions or changes to the premises e.g. breaking of the
walls, reworking, the verandah, repainting ,etc
 This covenant against alteration may be absolute or conditional.
 LESSEE must carry out alterations within the confines of the consent given.
SHORT LEASE-no alteration
L=LONG LEASE-alterations with landlords consent
DRAFT-
It may be drafted thus:
The tenant covenants not to make any alteration to
the premises without the written consent of the
Landlord, such consent not to be unreasonably
withheld and to restore the property to its original
position at the end of the term of the lease at his own
expense.
USEFULNESS-
1. Safeguards the premises and LESSORS reversion
2. Enhances lessee’s use or enjoyment of he property.

6. COVENANT TO INSURE
This is an undertaking to insure the demised premises by one of the parties to the lease
or in the name of one or all of the parties.
RATIONALE- Insurance of the demised premises is necessary because the parties
have insurable interests in the property. The Landlord has reversionary interest and
the tenant has possessory interest in the property.

CONTENTS OF A STANDARD INSURANCE COVENANT

The insurance clause should cover the following
1. Who is to insure –(POLICY HOLDER)
2. Risk to be insured (RISK)
3. Amount of insurance cover (AMOUNT) Comment [g35]: PRAAC-
Prudence Rejoiced about a car
4. Application of the insurance money.(APPLICATION OF INSURANCE
MONEY
5. The insurance company
DRAFT-
‘… To insure the property against fire with NICON insurance Co. Ltd (RC
NO 9999 )to the tune of N10,000,000 (ten million naira) in the name of
the lessee and make payment of all premium on the policy and in the
event of the property being damaged, all money received in respect of

80
 the insurance shall used to reinstate the property .if reinstatement is not
possible, the sum will be shared PRO RATA between the parties

WHO IS TO INSURE;
the following is to be considered
a. EXISTING OBLIGATIONS ON THE PROPERTY e e.g. where the lessor charges
the property for a loan and the bank requires him to insure the property.
b. THE NATURE OF THE PROPERTY: where part of the property is held by the
lessor, then he should insure the property to make sure a common policy
covers the whole property. Where LESSEE occupies an exclusively detached
flat, then the lessee should insure in his own name.
c. USER OF THE PROPERTY

THE RISK
 Depends on the nature of the premises
 Where a tenant is required to insure with a particular insurer but the lease does
not specify the risk to be insured against, the tenant’s obligation is to effect such
policy as is usual from time to time with the insurer. UPJOHN V HITCHENS

AMOUNT OF COVER
Amount should be FULL COST OF REINSTATEMENT
Under insurance should be avoided-BANDER PROPERTY HOLDING V.DARWEJI
LTD

APPLICATION OF INSURANCE MONEY

A.WHERE REINSTATEMENT IS POSSIBLE
 Generally, where the LANDLORD insures, the tenant cannot compel the landlord
to use insurance money to re-build the premises or to restrain the landlord
from suing for rents until the premises are rebuilt. -LEEDS V CHEETHAM .
 However, where the tenant insures or reimburses the landlord, he can
compel the landlord to use insurance money to reinstate the property.
MUNFORD HOTELS LTD V WHEELER;
 Note that where the tenant insures in his own name, in the absence of a
provision in the lease asking that the tenant should reinstate, the landlord cannot
compel the tenant to re-instate-

B.WHERE REINSTATEMENT IS IMPOSSIBLE

Provision should also be made in the lease where reinstatement is not possible(PRO
RATA).
In the absence of any Contrary provision, inference can be drawn from the terms of the
lease and the insurance policy-BEACON CARPETS LTD V KIRBY -Compare RE
KINGS

81
STAUTORY INTEVENTION-S.67 INSURANCE ACT,cap 117 ,LFN 2004(AS
AMENDED) Comment [g36]: Amended in 2007
1. A-Any person entitled to or interested in the insurance property can apply
to the insurance company.
2. D-Damage must be caused by FIRE
3. N-No grounds of suspecting fraud or arson must exist on part of the
insurer
4. A-the application should be made BEFORE the payment of the Insurance Comment [g37]: ADNA-Ada does not argue
money.
USEFULNESS
1. Protects the property and the reversion
2. In the event of loss, provides for reinstatement of the property
3. Provides for the sharing formula where reinstatement is not possible.

REMEDIES FOR BREACH OF COVENANT TO INSURE

1. Damages against the person who ought to insure but falls to do so.
2. Action for forfeiture if expressly provided
3. Application to court by a person interested in a destroyed property to use the
insurance money to reinstate the damaged property.

6. COVENANT AGAINST ASSIGNMENT AND SUB-LETTING

A tenant has the unrestricted right to assign his tenancy or to create subleases of such
tenancy in the absence of a provision to the contrary-INUWADAV BRYNE;KEEVES
V.DEAN
NOTE- THE ABOVE IS NOT APPLICABLE IN LAGOS-THE LSTL expressly prohibits a
Tenant from assigning or sub-letting any part of the demised premises without the
Landlord’s consent. Section 7(6) of the Tenancy Law, Lagos State 2011.
RATIONALE-This covenant ensures that the Landlord is in control of tenants occupying
the premises.

TYPES/FORMS
1. ABSOLUTE BAR/PROHIBITION
“Tenants shall not assign or part with possession of the demised premises .ISHOLA
WILLIAMS V.HAMMOND PROJECTS
IMPLICATION-It is harsh on the tenant. However, this statement is LIMITED as such
the tenant still charge his interest in the property.
NOTE WHILE DRAFTING- is advisable that all the acts prohibited must be covered in
the covenant as follows
Eg “Covenant not to assign, underlet, charge or otherwise part with possession of
the property.

IMPLICATION-the tenant does not have the right to sub-let or assign. He should
negotiate with the Landlord for an amendment of the clause.t

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NB(EXAMS): Where the tenant permits another person to use the premises e.g. allow a
licensee to use the premises, this does not amounts to breach of the covenant not to
assign or sublet. ISHOLA WILLIAMS V.HAMMOND PROJECTS
2. CONDITIONAL /QUALIFIED PROHIBITION
Not to assign, sublet, charge or part with possession of the premises or any part of it
without the written consent of the Landlord.
IMPLICATION-It is not good enough as the test for granting or refusing consent is
subjective.
3. BALANCED/IDEAL CLAUSE
“Not to assign, underlet or otherwise part with the possession of the demised
premises without the written consent of the landlord, such consent not to be
unreasonably withheld in the case of a responsible and respectable person”
IMPLICATION-It is used to ensure a balance of the competing interests of the parties.

GROUNDS FOR REFUSAL

For refusal to be reasonable or not, the following is considered
1. PERSONALITY OF THE INTENDED SUB-TENANT (financial standing and
relationship with previous landlords
2. THE USE OR PURPOSE for which the sub-tenant requires the premises
HOULDER BROTHERS &CO V.GIBBS;COHAM V.POPULAR RESTURANT
3. THE NATURE OF THE PROPERTY-SHANLY V. WARD;GOV. OF
BRIDGEWELL V. FAULKNER &ROGERS
The burden of proving that the reason of refusal is unsubstantial lies on the
tenant. HOLDER BROS & CO. LTD V. CRIBBS

NOTE THE FOLLOWING

1. Tenant should always request for consent before assigning
2. Once consent is given, it shall not be withdrawn – IDEAL FILMS RENTING CO.
V. NIELSON.;ALAKIJA V. JOHN HOLT;OBASUYI V. MANDILAS
&KARABERIS LTD.

USEFULNESS
1. Helps guide against nuisance to neighbours
2. Prevents subletting/assigning of property to persons who would use it for illegal
or immoral purposes
3. Helps to protect the lessors reversionary interest
4. Enables the lessee recoup part of his expenses or money expended on the
property.

REMEDIES AVAILABLE TO THE TENANT

i. Tenant can seek declaration that the refusal is unreasonable.
Tenant may compel the Landlord to give his consent in an action for specific
performance.

83
 Tenant may ignore the Landlord and sub-let and apply for an order of injunction
restraining the Landlord from harassing the sub-tenant.
Tenant may ask for damages.

REMEDIES AVAILABLE TO THE LANDLORD

1Where the tenant is in a breach of the covenant; the Landlord is entitled to remedies
The Landlord may seek court order for re-entry and forfeiture of the lease.
NB – the Landlord cannot resort to SELF HELP AKPINA V. BALOGUN
(UNREPORTED) ;OJUKWU V. GOVERNOR LAGOS STATE.

OPTIONS OPEN TO THE LESSOR UPON A BREACH OF ANY OF THE

COVENANTS BY THE LESSEE
1. Claim of damages
2. Action for forfeiture
3. Entry into the demised premises to carry out repairs
4. Action for specific performance of the covenants

PROVISOS IN A LEASE 3
Comment [g38]: List of provisos-AFR (5)
A-ABATEMENT OF RENT
This may qualify or limit any of the preceding covenants F- FORFEITURE AND REENTRY
1. OPTION TO RENEW /COVENANT FOR RENEWAL OF A LEASE R-OPTION TO RENEW
R-RENT REVIEW CLAUSE
 This is a lessor’s covenant made to the lessee that at the expiration of the R-OPTION TO PURCHASE REVERSION
MNEMONIC-AISHA FRIED RICE
lease and a new lease will be created for similar or reviewed terms, rents and
Comment [g39]: CAN BE A COVENANT OR
covenants. PROVISO
 Where it is provided in a lease, it may be enforced against the lessor.
 This term/covenant gives the Lessee/tenant the option to express his interest in
taking out the demised premises for another term of years as lease/Tenancy by
notifying the Lessor/Landlord on time on such terms as may be agreed by the
parties.
 PURPOSE-This may prevent the drafting of a new Deed of Lease or Tenancy
Agreement
NB-THIS OPTION IS REGISTRABLE AS ESTATE CONTRACT IN PCL AND RTL
STATES

CONTENTS OF THE OPTION TO RENEW CLAUSE

a. Time within which the application is to be made (3 months or six months)
b. Manner of the exercise (usually in writing)
c. Condition precedent to be fulfilled before exercise of the option (lessee to have
paid rent and performed all his covenants in the lease).
d. The terms of the new lease. IITA V. KHAWAM
USEFULNESS
5. Helps to secure LESSEE’S interest in the property at the end of the
subsisting lease
6. Helps lessees recoup part of his expenses or maximize his use of the
improvements in respect of the property.

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POINT SOLICITOR SHOULD NOTE
The Solicitor should be careful when drafting the covenant to ensure that no
perpetually renewable lease is created RE HOPKINS LEASE .
A perpertually renewable lease has not excluded the option to renew and it has
made the rent payable under the new term to be at the previous rate
EXAMPLE OF PERPETUALLY RENEWABLE LEASE-“The Lessor shall on the
written request of the lessee made at least three months before the expiration of
the current term, grant to the lessee the lease of the demised premises for
another term of five years from the expiration of the current term on the same
terms and conditions as this present lease”
METHOD-He should do this by stating that the terms of the new lease are created by
reason of the option to renew and expressly excluding the option to renew in the
subsisting lease agreement.

DRAFT
“The Lessor/Landlord shall on the written request of the lessee/tenant made three
(3) months before the expiration of the term hereby created, grant to the
lessee/tenant the Lease of the demised premises for another term of three (3)
years at a rent to be agreed and containing all the terms and conditions of this
Lease/Agreement EXCEPT the option to renew and the rent clause’.

OR…………………………………………………………………………………….
“The Lessor shall on the written request of the Lessee made at least three months
before the expiration of the current term, grant to the Lessee the lease of the
demised premises for another term of five years from the expiration of the current
term on the same terms and conditions as the present lease, except rent and this
option to renew; Provided, however, that Lessee shall have materially observed
all its obligations under the present lease”.

2.OPTION TO PURCHASE REVERSION

This is ASSIGNABLE-RE BUTTONS LEASE
ENFORCEMENT-TENANT may enforce option by action for specific performance
and may even sue to set aside the sale of the property to another person-OWOSHO V.
DADA

3.COVENANT TO DELIVER POSSESSION AT THE EXPIRATION OF TERM

GRANTED
NB-a tenant cannot be regarded as having delivered up possession if he vacates the
premises but RETAINS THE KEYS of the property thereby preventing entry of land lord-
ASOROPE V. ORELAJA

4.PROVISO FOR FORFEITURE AND RE-ENTRY

 This may lead to the suspension or termination of the lease for non-payment of
rent or non-observance of covenants of the lease.

85
  It operates to bring a lease to an end earlier than it would otherwise terminate.
 The law presumes against forfeiture of leases EXCEPT where the clause is
expressly stated.
 It may be drafted thus:
PROVIDED ALWAYS that if the tenant commits a breach
of covenants or conditions in the lease or becomes
bankrupt. It shall be lawful for the lessor to re-enter the
premise and immediately the term shall absolutely cease
and determine.
 The Lessor is required to strictly prove the breach of covenants by the lessee in
an action for forfeiture.
 NB In Lagos State, the right to forfeiture and re-entry leases is implied -S. 17(b)
RTL
 If the proviso for forfeiture and re-entry is not stated in the Lease/ Tenancy
agreement, the Lessor/Landlord must go to court.
 Note that if the lessee/tenant pays rent in an attempt by the Lessor/landlord to
forfeiture, the action of forfeiting the premises shall lapse. S. 14(10 of the CA
and S. 161(10)of the PCL.

ENFORCEMENT IN EVENT OF WAIVER OF FORFEITURE

Where the lessor has waived his right to _____covenants in lease, he cannot be
allowed to exercise the right for forfeiture.
The lessor may enforce the clause in two ways
a. By peaceable re-entry
b. By action for possession
5. ABATEMENT OF RENT-
 Must be provided for because generally frustration is inapplicable in leases.
 At Common Law if rent was paid over a premise and the premise is destroyed or
anything prevents its use, the rent will run till it expires and the tenancy will be
exhausted even if the tenant couldn’t use the premises.
RATIONALE-This is to prevent rent paid from running in such cases where the property
is destroyed e.g. by an act of God like storm, earthquake etc. or the premises unable to
be put to use.
DRAFT
‘… The Lessor covenants with the Lessee that the rent shall not
continue to run in a case of an act of God where the demised
premise is destroyed or anything happens preventing the use of the
premises.’

DETERMINATION OF A LEASE OR TENANCY Comment [g40]: S-surrender

D-DISCLAIMER
The following are the various methods in which a lease may be determined: N-NOTICE TO QUT
E-EFFLUXXION OF TIME
F-FORFEIITURE
F-FRUSTRATION
Stella does not eat fish fat.

86
 1. EFFLUXION OF TIME – A lease or tenancy for a fixed period is automatically
determined at the end of the period. The determination may also be the
happening of some events.
2. MERGER –This is where the tenant or third party retains the lease and acquires
the reversion before expiration of the lease.
 For a merger to be operative, the person in whom the merger is vested must
have acquired both the lease and the reversion in the same capacity
EXCEPT where he holds the eversion as an executor-CHAMBERS V.
KINGHAM t
3. NOTICE TO QUIT – statutory notices given in respect of statutory tenancies
.mode and length of notice is specified in the relevant laws. however parties can
exclude the application of this law in relation to length of notice.
4. BY SURRENDER -The lessee gives up his term of years to merge with the
lessors reversion. Surrender can be express (VOLUNTARY) or by operation of
law. Allen v. Roachdale
5. DISCLAIMER-where a lessee sets up an adverse claim to the ownership of the
property or claims direct ownership, the lessor is entitled to determine the lease.
6. FRUSTRATION-This is subject to the determination of the court in relation to the
circumstances of the case-ARAKA V.MONIER CONSTRUCTION NIG
LTD(lease held frustrated by civil war);NATIONAL CARRIERS LTD V.
PANALPINA(HOL).
NB-Where the property is destroyed and the LESSEE remains in possession,he
cannot plead frustration-ODUSANYA V.ONIORORO.
7. FORFEITURE – The landlord may become entitled to re-take the premises
before the expiration of the tenancy, where there is a breach of covenant to
pay rent or any other covenant by the tenant.
A-FORFEITURE AND RE-ENTRY FOR NON PAYMENT OF RENT
Applicable laws are COMMON LAW and COMMON LAW PROCEDURE ACT
1852-S.14(8) CA&161(10) PCL

CONDITIONS
4. express provision in the lease document
5. rent must be reserved
6. landlord must make a formal demand and tenant remains in default
NOTE-landlord may exclude the requirement for formal demand as follows
‘’the landlord may forfeit and re-enter the premises where the rent reserved is in arrears
for 21 days whether or not formally demanded”

B-FORFEITURE AND RE-ENTRY FOR BREACH OF ANY OTHER COVENANT

APPLICABLE LAW-S.14(1) CA1881 AND S.160&161 PCL
LANDLORD must serve a STATUTORY NOTICE which must contain the following
1.nature of the breach committed by the tenant
A request that the tenant should remedy the breach

87
 Allow a reasonable time for tenant to remedy the breach-ISHOLA WILLAIMS
V.HAMMOND PROJECTS

CONDITIONS FOR TENANTS RIGHT TO RELIEF AGAINST FORFEITURE AND RE-

ENTRY
1. He must be willing to pay and remedy the breach complained of
2. He is willing to pay the landlords cost of bringing the action
3. It is just and equitable to grant him relief.

PROCEDURE FOR DETERMINATION OF A LEASE OR TENANCY

1. If an agent is to act for the Lessor/ Landlord, give him a letter of authorization to act
2. The Lessor /Landlord or his agent is to serve a Notice to quit on the Lessee/ tenant. -
Form TL2 or TL3 of the Tenancy Law of Lagos 2011 and Form A/B or C/D of the
Recovery of Premises Act applicable in Abuja.
3. If the lessee/ tenant still retained the premises, serve Notice of Owner’s Intention to
apply to Court to recover possession which will last for 7 days (also called the 7 days
notice). See Form TL4 of the Tenancy Law of Lagos 2011 and Form E of the
Recovery of Premises Act applicable in Abuja.
4. Take out a Plaint or Claim or Writ in Court if the tenant is still in possession of the
premises. FORM TL6A or TL6B of the Tenancy Law of Lagos 2011 and Form F of
the Recovery of Premises Act applicable in Abuja.

5. PARTICULARS OF INSTRUCTION /INFORMATION NEEDED TO PREPARE A

LEASE
1. Particulars of the parties, such as: name, address, occupation
2. Commencement date
3. The property being demised, its detailed description and whether only parts of the
premises are being demised
4. Duration of the lease
5. Rent payable and method of payment; whether in advance or arrears
6. Covenants to be performed by the Lessee/Sub-Lessee
7. Covenants to be performed by the lessee/Sub-Lessor
8. Party to insure the property, duties and liabilities in respect of the insurance policy
9. Instructions on rent review (if desired), renewal of the lease, forfeiture and re-entry
10. Whether necessary consent has been obtained from Governor(sublease/C OF O)
11. Witnesses to attest the agreement Comment [g41]:

FORMAL PARTS OF LEASE Comment [g42]: CDPRTCPHRCPTSEA-

1.COMMENCEMENT: THIS LEASE or THIS DEED OF LEASE
where it is a simple tenancy, it is commended thus THIS TENANCY AGREEMENT OR
THIS AGREEMENT
2. DATE: Made this ………. Day of ……. 20 …
The date is the day the lease is made.
Where it is by deed, the important date is the date of delivery of the lease.

88
In tenancy agreement, the important date is the date of execution.

3.PARTIES:
INDIVIDUALS-BETWEEN …………. Of ……………. LESSOR/LANDLORD
And ……….. of …………….. lessee or tenant
COMPANY-XYZ LTD, a company registered under CAMA and having its registered
office at(the lessor of one part or the lessee of the other part
ATTORNEY-mr xyz,the lawful attorney of _________(lessee/lessor)

4. RECITALS: This is not an essential part of a lease EXCEPT

a. a sub-lease.
b. surety or guarantor
c.there is a POA Comment [g43]: DRAFT THE THREE
RECITALS
HOW IS THE COMMENCEMENT PART OF A
5. TESTATUM: WHEREBY the lessor agrees to demise to the lessee or IT IS LEASE DRAFTED WHEN THERE IS A SURETY

AGREED AS FOLLOWS; the Lessor demises to the Lessee the testatum contains the
operative words and parcel clause.

6. PARCEL CLAUSE: ALL THAT property (describe the property)

7. HABENDUM: TO HOLD UNTO the lessee for the terms of …………. years
commencing on ………….. and ending on …………….
NB = The phrase “commencing on includes the date named in computation while
“commencing from excludes the named date. Comment [g44]: POSSIBLE LIP AREA
FUNCTION-The habendum specifies the quantity, commencement of the term of a
lease.

8. REDDENDUM: paying yearly during the term the sum of …………………….

FUNCTION-The reddendum defines the amount of rent payable by the lessee, the
person to whom the rent is payable must be stated; as well as mode of payment
usually in advance.

9.COVENANTS:
10-PROVISOS- ‘PROVIDE THAT”
10. TESTIMONIUM: IN WITNESS OF WHICH the parties have executed this lease
in the manner below the day and year first above written.

FUNCTION-This clause connects the parties with the agreement

11 SCHEDULE: It should be inserted where necessary.
1.To describe the property in details.
2.The parts of the property to be repaired by each party
3.rent review formula Comment [g45]: Incorporate this in practice
drafts.
12. EXECUTION:
SIGNED, SEALED AND DELIVERED by the within named lessor or lessee.
This provides for the signature, mark or seal of the parties to the lease

89
TENANCY AGREEMENT-SIGNED by landlord or tenant.

WHERE ONE OF THE PARTIES IS A COMPANY

THE COMMON SEAL OF XYZ LTD is affixed to this lease and the lease duly delivered
in the presence of DIRECTOR AND SECRETARY.
BY AN ILLITERATE OR A FOREIGN PARTY WHO DOES NOT SPEAK NOR
COMPREHEND ENGLISH LANGUAGE
SIGNED,SEALED AND DELIVERED the illiterate /blind
Having been first read and interpreted to him in igbo
Language by me(name of interpreter)
When he appeared perfectly to understand it before
Affixing his thumb print,mark/signature Comment [g46]: For blind say read aloud.
For deaf and dumb ADD-the contents of this
______________ lease having been first been read over to
him by sign languge by__________a sign
language instructor when he appeared to
Name of illiterate perfectly understand it before affixed his
thumb print/mark.
BY AN ATTORNEY
SIGNED,SEALED AND DELIVERED
The lawful attorney of the lessor by virtue of a power of attorney dated ________
and registered as No__ page ____Vol_____ Comment [g47]: D DATED as
A-AND
R-REGISTERED
13.ATTESTATION: A-AS
N-NO
IN THE PRESENCE OF: P-PAGE
V-VOL
Name O-OF
Address: L-LANDS REGISTRY
-detra and rejoice are not proper virgins of
Occupation lagos
Signature
This contains the witnesses to the lease and their signature.

STEPS TO PERFECTION OF A LEASE

1.Obtain the Governor’s consent which is endorsed on the Deed of sub Lease. This is Comment [g48]: Pursuant to C OF O
not needed for a tenancy agreement OR a normal lease
2.Stamp the Deed of Lease at ad valorem rate
3.Registration at the Lands Registry of the State where the Land is situated

EXPRESSIONS RELATING TO TIME:

 ‘ON’-- plus the date mentioned- start counting from the day mentioned
 ‘From’: minus mention date- Exclude the mention date
NB: In computation, one does not have half of a day, the day starts from 12am.
 ‘After’—Exclude the day mentioned
 ‘till and until’: not clear if mention date should be included or excluded
 ‘As soon as possible’
 ‘within a reasonable time’
NB: the above two expressions should be avoided, and once a quit notice is
badly drafted, it is void for defective computation of time.
90
 ETHICAL ISSUES
1. .failure to reflect instructions given ;-rule 14
2. Duty to show competence when drafting the lease agreement R. 16.
3. The document should correctly and fully reflect the wishes of the party with special
reference to the covenants.
4. Duty not mix the rent paid the client with solicitors money or not spend such fund
belonging to the client R. 23(2) RPC.
5. Duty not to frank a document not prepared by the Solictor R. 3(2) RPC.;S.10 LPA
6. Duty not to aid a non-lawyer in the unauthorized practice of R. 3(1)(a).

A- DEED OF SUB LEASE (ILLITERATE AND COMPANY)BELOW:

THIS DEED OF SUB-LEASE made this ………….. day of …………… 2014

BETWEEN Mrs. Aduke Thomas of 15 Ojota Road Yaba Lagos State (‘The Sub-Lessor’)
of the first part
AND Pages and Print Limited a company duly incorporated under the Companies and
Allied Matters Act 2004 with its registered office address at No. 56 Igala Street Ikoyi
Lagos State (‘The Sub-lessee’) of the second part.
RECITALS
8. The sub Lessor is the lessee of the property owned by MR X,the BENEFICIAL
OWNER of a Duplex with Boys Quarters situate at No. 8 Ajagun Estate, Nyanya Abuja,
by virtue of a Deed of assignment dated 21st June 1995 registered as No. 4051 pages
50 in volume 1350 at the Lands registry_______
9. The sub-lessor has the consent of the lessor/owner to enter into the transaction
10. The sub Lessor desires to lease the property to the Lessee for a term of five
years.
OR……………………………………………………..
IF IT IS PURSUANT TO A C OF O
1.The sub lessor is the beneficial owner of the property a Duplex with Boys Quarters
situate at No. 8 Ajagun Estate, Nyanya Abuja, by virtue of a certificate of occupancy
dated 21st June 1995 registered as No. 4051 pages 50 in volume 1350 with the Abuja
Geographic Information systems
2. The consent of the minister of FCT has been obtained
3. The sub Lessor desires to lease the property to the Lessee for a term of five
years.

NOW THIS SUB-LEASE WITNESSES AS FOLLOWS:

1. In CONSIDERATION of the rent and covenants reserved in this Deed, the Sub-
Lessor AS BENEFICIAL OWNER demises to the Sub-Lessee ALL THAT four
bedroom bungalow at No. 13 Chime Avenue, Enugu, Enugu State covered by a
certificate of Statutory Occupancy registered as 45/45/2345 and rightly described in
the survey plan attached to the 1st Schedule referred to as ‘The demised Premises’

91
2. TO HOLD UNTO the Sub-Lessee for a term of ten (10) years commencing on the 1st
day of February 2014 and to expire on the 31st day of January 2024, subject to any
proviso for determination contained in this Sub-Lease.
3. PAYING the sum of three million naira only per annum (N3, 000, 000.00) (the
receipt of which the Sub-Lessor hereby acknowledges) as rent for the term granted,
payable in advance the first of such payment to be made on the 2 day of February
2014.
(THE COVENANTS ARE TO BE HERE AS PART OF THE MISCELLANEOUS PART
OF THIS SUB-
LEASE)

PROVIDED ALWAYS THAT in breach of any of the covenants contained in this Deed
by the Sub-lessee, the Sub-Lessor may forfeit the sub-lease by re-entering the
premises or any part of it and the term granted in this Deed shall come to an end
immediately.
OPTION TO RENEW:
The Sub-Lessor shall on the written request of the Sub-Lessee made three (3) months
before the expiration of the term hereby created, grant to the Sub-Lessee the sublease
of the demised premises for another term of three (3) years at a rent to be agreed and
containing all the terms and conditions of this Deed EXCEPT the option to renew and
the rent clause.
IN WITNESS OF WHICH the parties have executed this sublease in the manner below
the day and year first above written.
1st Schedule

SIGNED, SEALED AND DELIVERED

By the Sub-Lessor
Mrs. Aduke Thomas …………………….

The contents of the foregoing having been first read and explained to her from English
Language to Yoruba Language by me Felicia Olutope of ………………… when she
appeared perfectly to understood same before making her thumb impression above.
BEFORE ME

MAGISTRATE/NOTARY PUBLIC/COMMISSIONER OF OATHS

The common seal of the Sub-Lessee is affixed on this Deed the ……. day of ………..
2014 and duly delivered in the presence of:
……………………….. …………………………………
Director Secretary

I CONSENT TO THIS SUB-LEASE

DATED THE …..DAY OF ……….2014

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EXECUTIVE GOVERNOR OF ENUGU STATE /MINISTER OF THE FCT

TENANCY AGREEMENT

THIS TENANCY AGREEMENT made the …………. Day of …….. 2014.

BETWEEN
MRS. ADEMOLA AJAO of No. 4 Olusegun Crescent, Wuse II Abuja (“Landlord”) of
the one part
AND
MRS. PAUL IKENNA of NO. 16 Latifa Close Garki, Abuja (“tenant”) of the other
part .

IT IS AGREED AS FOLLOWS:
The landlord demises to the tenant ALL THAT premises together with the Boys
Quarters and known as No. 8 Ajagun Estate, Nyanya Abuja, TO HOLD the same to the
tenant from the 1st day of January 2014 for the term of two years to end on 2nd January
2016
PAYING the yearly rent of N1,000,000 One Million Naira only) clearly of all
deductions by yearly payment in Advance; the first of such payment to be made on
………. Day of ………. 2014.
The rent is subject to review in accordance with the provisions contains in the
Schedule to this lease.

THE TENANT COVENANTS WITH THE LANDLORD AS FOLLOWS

1. To pay rent reserved in the lease on the day mentioned.
2. Pay all rates, taxes, assessment, charges and outgoings or as may be imposed
later whether payable by Landlord or not.
3. Not to assign, sublet, or otherwise part with possession of the property or any
part thereof without the consent of the Landlord in writing first had and obtained
such consent not to be unreasonably withheld for a respectable and responsible
person.
4. Not to make any alteration to the property except for installation of A-C and
Burglary proof without the consent of the Lessor and to restore the property to its
original position at the end.
Comment [g49]: R- Rent
5. To keep the premises in a good state of repairs, fair wear and tear excepted and R-RATES AND TAXES
A-ASSIGNMENT PROHIBITION
to deliver up possession of the property at the end of the lease term. A-ALTERATION PROHIBITION
6. To use the property for residential purposes only. R-REPAIRS
U-USE COVENANTS
RRAARU (IGBO WORD FOR SLEEP)
Rita rejoiced and arranged roasted corn and
The LANDLORD covenants with the TENANT as follows:
Ube
1. The Lessee shall have a quiet possession of the property free from interference Nb-CORN IS NOT PART OF THE ACRONYM

by the landlord or his agents. Comment [g50]: Q-QUIET ENJOYMENT

I-INSURANCE
2. To insure the property against fire with NICON insurance Co. Ltd(RC NO 9999 R-OPTION TO RENEW
)to the tune of N10,000,000 (ten million naira) to be paid by the tenant and in the A-ABATEMENT CLAUSE
Queeneth is rocking armani

93
 event of the property being damaged, all money received in respect of the
insurance shall be used to reinstate the property .if reinstatement is not possible,
the sum will be shared PRO RATA between the parties.
3. Upon the Lessee paying the rent and observing all the terms and covenant in the
Lease upon 3 months before the expiration of the tenancy the Landlord shall
(may) grant him a further term of two years at a rent and terms to be agreed by
the parties.
4. The Lessor covenants with the Lessee that the rent shall not continue to run in a
case of an act of God where the demised premise is destroyed or anything
happens preventing the use of the premises.’
PROVIDED ALWAYS that if the rent reserved or any part of it shall be unpaid for
twenty eight(28) days after becoming payable and demand made for it or if the lessee
commits a breach of the covenants in the Lease or the Lessee become bankrupt, it shall
be lawful for the Lessor to re-enter the premises and immediately the term shall
absolutely cease and determine.

AS WITNESSED the parties have executed this agreement in the manner below day
and year first above written.

SIGNED
By the within named landlord……………..
……………….
Mrs. Adebayo Ajao

IN THE PRESENCE OF:

Name:
Address:
Occupation:
Signature:

SIGNED
,by the within named tenant
…………………..
Mr. Paul Ikenna

IN THE PRESENCE OF:

Name:
Address:
Occupation:
Signature:

94
 WEEK 11-13-MORTGAGES

APPLICABLE LAWS TO MORTGAGE TRANSACTION

Land Use Act,
CFRN,
Stamp Duties Act,
Rules of Professional Conduct,
Land Instrument Registration Law,
CAMA S. 197
Registration of Titles Law,
Property and Conveyancing Act,
Mortgage Institution Act,
Mortgage Law of Lagos State
Law Reform Contract Law,
Federal Mortgage Bank of Nigeria Act,
Illiterate Protection Law (where applicable).

MEANING/DEFINITION
 A legal relationship or security transaction by which rights in land are transferred to
secure payment of money or the discharge of some other obligations subject to
redemption upon repayment of the loan or discharge of the obligation. – SUBERU V.
AISL LTD (2007) 10 NWLR (pt 1043) 590. SANTLEY V. WILDE
 A security created by contract for the payment of a debt already due or to become
due. OLOWU V. MILLERS BROS LIMITED.

OTHER TYPES OF SECURITY (APART FROM LAND) --

1. Debenture
2. Insurance securities
3. Guarantees
4. Stock and shares
5. Charge over fixed deposit account
6. Trust receipts
7. Bill of sale
8. Letter of set-off
9. Trust deed, etc.

REASONS FOR THE PREFERENCE OF LAND AS AGAINST OTHER PROPERTIES

AS SECURITY FOR A LOAN
The reasons for this preference are not far-fetched.
1. Landed properties are more stable.
2. The value of land appreciates than the others, particularly in times of inflation.
3. Land is immovable and we can go to the land and inspect it physically.

95
 4. It is easier for banks and other mortgagees to enforce their security in the case of
landed properties than other properties.

PARTIES TO A MORTGAGE
The Mortgagor/borrower: This is the person borrowing the loan and advancing the Comment [g51]: Must have a statutory
right of occupancy
security.(USUALLY PROPERTY)
The Mortgagee/lender This is the party advancing the loan.(usually BANK)

TRIPARTITE MORTGAGE
 Where the mortgaged property belongs to a third party
 Where a third party guarantees the repayment of the loan by the mortgagee
 The third party should become a party ie a guarantor or surety
NB-there will be three parties and tripartite Deed of mortgage

QUESTIONS
1. In what situation can a mortgagee insist that there should be a guarantor to
the mortgage?
ANS-Where the collateral is not up to 70% of the value of the loan given the
mortgagor.
Where it is a commercial bank, if the mortgagor is not a customer of the bank, the bank
would require him to produce a person who is the bank’s customer (of certain financial
status) to guarantee the loan to the mortgagor.
2. Would the mortgagee insist that the guarantor should deposit his title deed
The mortgagee usually insists that the guarantor deposits his title deeds with the
mortgagee so that upon default to pay the loan by the mortgagor, the mortgagee (or
Bank) can exercise its powers/rights over the guarantor’s property.

FEATURES OF A MORTGAGE
a. It is a conveyance of an interest in land to a lender of money
b. The land is held only as security or collateral to ensure repayment of the money
loaned.
c. The property is re-conveyed back to its owner when the money loaned is repaid.
d. In the event of failure to repay the money advanced, the lender of the money has the
right to sell the land to realize the money advanced.
e. An essential feature of mortgage both legal and equitable is that once a mortgage,
always a mortgage and nothing but a mortgage YARO V. AREWA
CONSTRUCTION LTD.

CONTRACT SUBJECT TO MORTGAGE

A contract of sale of land entered into in expectation of some loan should be made
conditional upon your client (purchaser/borrower) obtaining the loan. The contract
should also provide that in the event that the loan is not obtained, the vendor shall
return the deposit paid by the purchaser; this is what is referred to as contract subject to
a mortgage.

96
CONDITIONS FOR THE VALIDITY OF THE SUBJECT TO MORTGAGE CLAUSE IN
A CONTRACT OF SALE OF LAND

1. It must state the source and amount of the loan.

2. The terms of payment; and
3. The interest paid on the loan.

Here is a model subject to mortgage clause in a contract of sale of land:

“This contract of sale is conditional on the purchaser obtaining a mortgage loan from
BETTER BANK LTD in the sum of N5,000,000 (five million naira) with interest payable
at the rate of 12 % PROVIDED THAT where the loan is not obtained on completion, this
contract of sale shall be void and the purchaser shall be entitled to the return of the
deposit paid."

MORTGAGE AND SIMILAR TRANSACTIONS

1. Mortgage and Assignment
In assignment, there is a transfer of the totality of interest of a person in property
while in a mortgage; title is transferred subject to redemption upon payment of
the loan.

2. MORTGAGE AND LIEN

A lien is a claim or qualified right of a creditor over the property of a debtor which
serves as security for the debt. It is the right to retain possession of a property of
another until a debt is paid. Afro Tech Services Ltd . Mia and Sons Ltd.
The holder of a lien does not have the right to sell the property unlike in mortgage,
where the mortgage has a right of sale.
A lien may be created over other properties and not necessarily on real property as in
mortgages.

3. MORTGAGE AND PLEDGE

Pledge is a deposit of some personal property to a creditor as a security for some
debt or performance of some act. The pledgor only has a possessory right over the
property while the mortgagee acquires ownership in the property.
In ADETONO V. ZENITH INTERNATIONAL BANK PLC. The court
distinguished a mortgage from a pledge thus:
“…by mortgage the title is transferred.
By a pledge, possession is transferred…”

ROLE OF SOLICITORS IN MORTGAGE TRANSACTIONS

1. Investigation of title of the property sought to be mortgaged
2. Prepare a search report
3. negotiation of the terms and conditions of the loan
4. drafting the mortgage instrument

97
5. perfecting the mortgage – consent, stamping and registration
6. Assist in discharge of the legal mortgage.

MORTGAGE INSTITUTIONS IN NIGERIA Comment [g52]: 1.The Federal Mortgage

Bank
These are largely regulated by the provisions of the Mortgage Institutions Act Cap 2.Housing Corporations like Federal Housing
M19 LFN 2004. Authority
3.Finance Banks
4.Commercial Banks
5.Insurance Companies
(1) FEDERAL MORTGAGE BANK 6.Private property developers
7.Housing schemes
This Bank (FMBN) is established pursuant to the Federal Mortgage Bank of 8.Life endowment policies
Nigeria Act Cap E16 LFN 2004. This is the apex mortgage institution in Nigeria.
It grants loan for the purchase or construction of houses or for the improvement or
extension of existing ones. Its loans are usually granted to mortgage institutions and
individuals FMBN V. OLLOH.
It is a Federal Government agency and should be a PREFERRED MORTGAGE
INSTITUTION for the following reasons;
a. The facility granted is long term(up to25 to 30 years repaymenT
b. Provides up to 66% of the consideration
c. The interest rate is very low, as low as 6%
d. Has branches across the federation
e. Enjoys government support
1. It gives long-term credit facilities.
2. The interest rate of the bank is low.
3. It can give as much as 66 per cent of the purchase price as loan.
4. It has branches spread all over the country but this exists, to a large extent, in
theory.

(2) HOUSING CORPORATIONS

The most prominent of these statutory corporations is the Federal Housing Authority
established by the Federal Housing Authority Act, Cap , LFN 2004, which was set
up primarily to execute the National Housing Programme.

At the States level, we have the State Property Development Corporation. In Lagos
State, it is called Lagos State Development & Property Corporation (LSDPC) and in
Kogi it is the Kogi State Investment and Property Ltd. In most other states, it is called
the State Housing Corporation. They provide funds for building and sometimes they
build houses and sell to the public through mortgage.
Advantages of this source of Mortgage Finance
1) There is security of title in respect of property purchased from any of these
corporations as there is no problem of demolition.
2) Funds from the corporation attract low rate of interest.
3) They are built on State land with their Certificate of Occupancy ready for
collection; C of O is automatic and immediate.

98
Disadvantages
1. Prices are beyond the reach of ordinary Nigerians.
2. There is scarcity of funds, particularly for housing projects.

(3) HOUSING SCHEMES

This is employers’ scheme for the benefit of employees, to enable them (employees)
acquire their own houses. The practice is that the employee is required to deposit the
title document with the employer until the loan is liquidated.
Advantages
1. Interest rate is low.
2. It is on a long-term repayment plan. In other words, affordable deductions are
made from the employee’s remunerations for several years.

Disadvantages
1. The scheme is no longer popular because of lack of funds.
2. Many workers cannot afford it.

(4) COMMERCIAL BANKS

Commercial banks are in the business of providing credit facilities for financing projects,
including housing. Usually, the customer would have to pay 20-40 per cent of the cost
of the property while the bank provides the balance. Period of repayment is between 5
and 10 years, depending on the bank, and interest rate is as high as 21 per cent.
This therefore is not the best option for loan to build or purchase houses; the interest
rate is very high and customers are often unable to provide the kind of collateral
demanded by the banks.

DISADVANTAGES
1. Interest rate is usually very high.
2. Their loan may be short-term
3. Stringent collateral conditions
(5) PRIVATE PROPERTY DEVELOPERS
Private property developers build houses like the housing corporations and make them
available to the public on mortgage basis.
A buyer pays deposit and takes possession. Balance is repayable over long period, of
course, at an interest rate.

(6) LIFE ENDOWMENT

This is a policy of life insurance and is a form of savings.
Insurance companies may lend or guarantee loan from a bank with a collateral
mortgage of life policy.
The borrower assigns the policy to the lender and the notice of this is given to the
insurance company.
ADVANTAGE- It is a good retirement plan
DISADVANTAGE-

99
  Not common among insurance companies because it is a long-term loan.
 the lender will have to wait for the number of years stated in the policy .
 where payment is due on the death of the borrower, he will have to wait till he
dies.

INVESTIGATION OF TITLE
Method of investigation here is similar to the method a purchaser’s solicitor adopts in
investigating a vendor’s title in conveyancing.

DIFFERENCES BETWEEN INVESTIGATION OF TITLE DURING PURCHASE AND

MORTGAGE
1. the mortgagee has a stronger bargaining power and is in a better position than the
purchaser;
2. there is yet no existing contract between the proposed mortgagor and the mortgagee
and so there is no obligation on the part of the mortgagee to advance money,
3.The mortgagee may therefore at any time withdraw from the transaction if it is not
satisfied with the mortgagor’s title but a purchaser is compelled under the contract to
complete the purchase.
Two major issues that must be properly investigated before loan is approved on the
security of a building or land are:
a) the title of the borrower; and
b) the value of the property – this must accommodate the credit proposed by
the borrower

REASONS FOR INVESTIGATING BORROWER’S TITLE

a) to ascertain borrower’s ownership of the property mortgaged to the bank as
security;
b) to ensure that the same property has not been previously mortgaged or charged
as security;
c) to ascertain that there is no other encumbrances on the property.

Depending on the circumstances, investigation of the borrower’s title may require

all or one of the following
a) a thorough scrutiny of the document, which may be a Deed of assignment,
certificate of Occupancy, Land Certificate, Certificate of Purchase, Deed of
Lease, etc.
b) physical inspection of the property;
c) searches at the land Registry, Probate Registry, Companies Registry, etc;

The brief for the investigation of title in a mortgage transaction is usually given out by
Banks, through their legal Departments to External Solicitors.
After the search, the Solicitor writes a Search Report, which is sent to the Bank for
consideration whether or not to accept the property as security.

100
The solicitor should comment on the type and condition of the building, whether or not
there are tenants, squatters, right of way or other encroachments.

CHECKLIST OF MATTERS TO BE COVERED BY A SEARCH REPORT:

a) Date of Search;
b) Name of Borrower;
c) Name of the person giving security, if different from the borrowers;
d) Description of the property;
e) Title of the borrower or person giving security;
f) Valuation report if any
g) Encumbrances (if any);
h) Conclusion/Remark—this should state in unequivocal terms whether or not the
borrower or person giving security has good title to the property and whether or
not he has an unencumbered power to charge it to the Bank as security for a
loan.
i) Name, address and signature of the solicitor that conducted the search.
Where the borrower is a company/incorporated body, the following matters
should be inspected at the Corporate Affairs Commission:
a) Date of incorporation/registration of the company;
b) Borrowing powers of the company;
c) Particulars of Company Directors;
d) Whether annual returns are filed up to date;
e) Any registered charge or encumbrances.

CREATION OF MORTGAGES
There are, at common law, two broad types of mortgages, namely, LEGAL and Comment [g53]:
EQUITABLE.
(1) LEGAL MORTGAGE
This mortgage created pursuant to statutory provisions. It is usually by Deed.
Creation of Legal Mortgage
The location of the property determines the mode of creation and the law(s) applicable.
The country is divided into three jurisdictions, namely –

1) The Conveyancing Act, 1882 (CA) States -- Under the Conveyancing Act, we Comment [g54]: (for States of the old
Northern and Eastern regions and some
have two Methods/modes of creating a legal mortgage: parts of Lagos).EDPO & DELTA IS
a. By assignment of the unexpired residue of the mortgagor’s leasehold EXCLUDED
Comment [g55]: This can also be called
interest with a proviso for ceaser upon redemption:
conveyance.note that where the mortgagors
 One major feature of this in that the mortgagor transfers the entire title is a deemed grant under LUA it is can be
called CONVEYANCE not ASSIGNMENT
unexpired residue of his leasehold interest to the mortgagee;
 there is No reversionary interest in the mortgagor, hence in the event of
default, the mortgagee can pass the mortgagor’s entire interest to a
purchaser without any problems.
 There is no privity of contract between the Governor/Head-lessor and
the mortgagee, there is privity of estate;

101
ADVANTAGES
a. The totality of the interest in the property is assigned to the mortgagee.
b. The mortgagee can exercise his right of sale easily: thus he can transfer the
interest assigned to him to a subsequent purchaser
c. The title deeds are retained by the mortgagee.

DISADVANTAGES
a. Assignment creates a privity of estate between the mortgagee and the
overload.
b. Thus, the mortgagee is liable for breach of all covenants and conditions in the
head lease.
e.g. The mortgagee becomes responsible to the Governor for covenants in the Right of
Occupancy granted the mortgagor.
b) Sub-demise of the unexpired residue less few days with a proviso for Comment [g56]: ADVANTAGES OF
MORTGAGE BY SUB-DEMISE
ceaser upon redemption – 1.It is only a sub-demise of the unexpired
Unlike in assignment, the mortgagor here has a reversionary interest in the mortgage residue less few days with a proviso for cesser
upon redemption
property. The main advantages of this mode are: 2.The mortgagor still retains the reversionary
interest in the mortgaged property
i) There is neither privity of contract nor privity of estate between the 3.The doctrine of privity of estate and contract
is inapplicable
Governor/head-lessor and the mortgagee; 4.There is uniformity as mortgages can be
ii) there is uniformity , as this mode is applicable under the CA as well as created by sub-demise in both the CA and PCL
States
under the PC & L.. 5.can be used to create successive legal
mortgage in the PCL States only
This makes attractive to banks.
DISADVANTAGES OF MORTGAGE BY
C) DEMISE- S.34&36 LUA(DEEMED GRANTS) SUB-DEMISE
D). DEED OF STATUTORY MORTGAGE-S.26(1) CA 1.The mortgagee cannot sell free of the
mortgagor’s reversion unless he includes the
 A freehold or leasehold holder may create a legal mortgage by deed expressed remedial clauses of :
a.Power of attorney
to be made by way of statutory mortgage. b.Trust declaration
Under the PCL there is no need for the above
 It is simple to create and can be discharged by a simple receipt. clauses to cure the disadvantage of a mortgage
by sub-demise as that has been taken care of
by section 112(1) of the PCL and RE
2) PROPERTY & CONVEYANCING LAW (PCL) STATES: -- Under the PCL, there WHITE ROSE TRUST. The disadvantage
is only peculiar to the CA States.
are two methods/modes of creating a legal mortgage: 2.In the CA States, the mortgagor cannot
1. Demise of a freehold for a term of years absolute subject to cesser of create successive legal mortgage

redemption- Comment [g57]: (for the States of the old

Western and Midwestern regions, except
S.108 PCL-This has been abolished in PCL states but however this may be allowed Lagos),

under S.34&3LUA 1978

2. -Sub demise for a term of years absolute, less at least one day than the term
vested in the mortgagor and subject to provision for ceaser on redemption –
S.109 PCL;AKANO V.FBN PLC
The same rules as explained earlier apply here, except that under the PC & L, there is
no need for the drafting devices. The law already makes provisions for them. See
section 112, PC & L.
3. A charge by Deed expressed to be by way of legal mortgage –S.110
PCL
This charge confers in the mortgagee all the powers and privileges of a legal
Comment [g58]: He has a right to sell the
mortgagee, even though it creates NO LEGAL INTEREST. property

102
ADVANTAGES:
1) Since no interest is passed to the mortgagee, it is no breach of the covenant
against sub-letting. SECTION 22, LAND USE ACT
2) it is shorter and simpler to create. Samuel v. Jarrah
3) it is easily discharged by a statutory receipt.
4) There is no transfer of the legal interest in the land/property used as security
5) It is convenient for mortgaging mixed properties
6) The Chargee has all the rights, powers and protection of a Legal mortgagee
7) It is best for creating successive legal mortgages without drafting a new Deed

WHEN RECOMMMENDED-this mode is most appropriate where the mortgagor is

charging several properties. If the mortgages were by assignment/sub-demise, each of
the properties would have to be conveyed by a separate instrument.

DRAWBACK-The statutory receipt is not a registrable instrument, with the effect

that at the discharge of the mortgage ,the mortgage can still be found on the Register.

3) Creation Of Legal Mortgage Under The Registration Of Title Law, Lagos: -- Comment [g59]: Lagos (for some parts of
Lagos, especially Victoria Island, Ikoyi and
This law regulates creation of mortgage in the Registration District of Lagos. The Surulere).
charge is completed by entry in the register of titles of the particulars of the
mortgage and the registeration of the charges in the land registry using FORM 5
in the 1st schedule to the RTL. SECTION 18/21, RTL.

DISTINCTION BETWEEN LEGAL MORTGAGE CREATED BY ASSIGNMENT in CA

AND LEGAL MORTGAGE CREATED BY SUB-DEMISE IN CA AND PCL
Banks prefer legal mortgage by sub-demise for two reasons:
1. Lack of Privity -- In a legal mortgage created by an ASSIGNMENT, even though
there is no privity of contract, there is privity of estate, binding the mortgagee
with liability for restrictive covenants running with the land. Tulk v. Moxhay. This
opens the mortgagee (BANK) to liability for breach of the covenants.
On the other hand, in a mortgage by sub-demise, there is neither privity of
contract nor privity of estate between the Governor/head-lessor and the
mortgagee, so
2. Uniformity The sub-demise is common to both under the CA as well as under
the PC & L, hence there is uniformity, which is attractive to the Banks that have
branches all over Nigeria. but assignment is only peculiar to CA states
3. Creation of successive legal mortgages using the same property as security
is not possible in CA states but only possible in PCL states for mortgages
created by CHARGE BY DEED/SUBDEMISE-S.109(2) PCL
4. Sub demise presents a technical problem ;mortgagor did not convey his
reversionary interest to the mortgagee, thus when the mortgagee is enforcing the
security, it cannot sell that reversionary interest. Comment [g60]: THIS PROBLEM DOES NOT
ARISE IN ASSIGNMENT
NOTE:

103
A) this problem is peculiar to the CA States; the problem does not arise in the PC &
L States because section 112(1) of the P & CLA\;RE WHITE ROSE TRUST
provides that the mortgage term shall merge in the leasehold reversion and the
mortgagee can validly sell the entire interest of the mortgagor including his
reversionary interest.
B) The problem does not arise in legal mortgage by assignment, since there is no
reversionary interest in the mortgagor.
In the CA States, the problem of reversionary interest can be taken care of BY
INSERTING THE FOLLWING IN THE MORTGAGE DEED.
1. POWER OF ATTORNEY CLAUSE: By a power of attorney clause in the
mortgaged deed, the mortgagee, in consideration of the mortgage sum is
appointed attorney with authority to deal with the entire estate and including the
reversionary interest.
 The power of attorney is expressed to be irrevocable until the loan is
discharged and by this device, the mortgagee can sell the legal estate by
virtue of the clause.
2. TRUST DECLARATION: the mortgage may provide for a trust declaration. The
 Mortgagor will be made to declare himself a trustee of the property in
favour of the mortgagee and he would convey the property to the
mortgagee as a beneficiary. T

ADVANTAGES OF LEGAL MORTGAGE

1) It is easier to enforce a legal mortgage. The equitable mortgagee must obtain a
court order before he can sell or take possession of the property or foreclose or
appoint a receiver/manager.
2) A legal mortgagee without notice of the equitable mortgage takes priority over the
equitable mortgagee
3) It is easier to commit fraud in the case of equitable mortgage than in legal
mortgage; the borrower who has deposited the original title deeds with a bank may
obtain a certified true copy of the Deed from the Registry for other fraudulent
purposes.

CREATION OF SUCCESSIVE LEGAL MORTGAGES USING THE SAME PROPERTY

AS SECURITY
This occurs when the same property is mortgaged twice or more in security
transactions.
(1) In the Conveyancing Act States: successive legal mortgages cannot be
created over the same property.
This is because in the CA States, the applicable law for the creation of legal mortgage
is the common law.
RATIONALE- This is because mortgagor transfers his legal title in the property to the
mortgagee and what he has left is mere equity of redemption, which can at best only be
used to create an equitable mortgage.

104
(2). In the PC L States: successive legal mortgages can be created over the same
property as Section 163, PCL has however abolished the doctrine of interesse
termini,.
RATIONALE-This is because under the PCL, where the mortgagor creates a legal
mortgage by sub-demise, he retains his legal interest, which he may subsequently
mortgage to a second mortgagee by executing another legal mortgage.

CONDITIONS FOR CREATION OF SUCCESSIVE LEGAL MORTGAGES UNDER

THE PCL
1. The legal mortgage must have been created by subdemise OR charge by
deed expressed to be by way of legal mortgage.
2. The term to be taken by a subsequent mortgagee shall be one day longer than
the term vested in the other mortgage whose security RANKS BEFORE THE
SUBSEQUENT
3. the entire interest must not be exhausted. section 109 (2) PCL
NOTE-The arrangement permitted by section 109 (2) (b) PC & L would have been
legally impossible because it is in conflict with the Common Law doctrine of interesse
termini, which states that it is not possible to create a term of years in a property to
commence at the expiration of another term of years created in respect of the same
property.

DISTINCTION BETWEEN LEGAL MORTGAGE CREATED BY ASSIGNMENT/SUB-

DEMISE & ONE CREATED BY A CHARGE BY WAY OF LEGAL MORTGAGE

1) In an assignment/sub-demise, the mortgagor conveys the whole or part of his

interest to the mortgagee, whereas the mortgagor by way of a legal charge does not
convey any interest in the property but enjoys rights of a legal mortgagee
2) the mortgagor can charge several properties. but in assignment/sub-demise, each of
the properties would have to be conveyed by a separate instrument.
3) When the head-lessor prohibits the assignment of the property, such property may
still be charged without liability, unlike in assignment and sub-demise

STAGES IN A MORTGAGE TRANSACTION

Upon receipt of instruction to effect a mortgage, a legal practitioner is expected to follow
the following order:
1. Negotiation of the loan
2. Investigation of the mortgagor’s title to the property to be used as collateral security/
valuation of the property
3. The search Report is prepared by the Mortgagee’s solicitor
4. Parties agree on the terms of the mortgage. This is put in a loan agreement
5. Preparation of Loan agreement and a Mortgage Deed and submit.
6. Execution of the Deed of Mortgage by the parties
7. Perfection of the Deed of Mortgage

105
8. If a company is the Mortgagor, file Form CAC 8- Registration of Charges with the
CAC within 90 days of its creation.
9. If the mortgage sum has been repaid by the Mortgagor company, file Form CAC 9-
Release of Charge to notify the CAC

CREATION OF EQUITABLE MORTGAGE

An equitable mortgage is a type of mortgage created under the rules of equity. It confers
equitable interest on the mortgagee. Equitable mortgage is more suitable for short-term
loans

MODES OF CREATING EQUITABLE MORTGAGES- OGUNDAINI V. ARABA–

Modes of creating equitable mortgages in Nigeria are uniform, except for the RTL areas.
There are six modes of creating equitable mortgages in Nigeria
1. Deposit of Title Deed With an intention to create mortgage
 There must be a clear intention that the deed should be taken or retained
as security for a loan.-BRITISH AND FRENCH BANK LTD. V. S. O.
AKANDE
 The mere deposit of title deeds for safekeeping with the bank does not
amount to creation of equitable mortgage. BANK OF THE NORTH V.
AKINTOYE
MODE OF SHOWING INTENTION-, This is done by the mortgage signing a
memorandum of deposit. If the memorandum of deposit is under deed (POS CAN BE
CARRIED OUT)

LEGAL CONSEQUENCES OF THE DEPOSIT OF TITLE DEEDS AS SECURITY FOR

A LOAN:
a. There is an implied agreement by the mortgagor to execute a legal mortgage in
favour of the mortgagee.
b. It amounts to part performance as agreement becomes enforceable WALSH V.
LONSDALE ; RUSSEL V. RUSSEL
2. An agreement to create or execute a legal mortgage at a later date – once
the lender advances the money, whether or not the agreement is under seal,
equitable mortgage is created. The equitable mortgagee can enforce the
agreement by an action in equity for specific performance, on the principle in
WALSH V. LONSDALE ;YARO V. AREWA CONSTRUCTION LTD ; CARTER
V. WAKE OGUNDAINI V. ARABA
3. An imperfect legal mortgage will amount to an equitable mortgage so long as
the title deeds have been deposited OGUNDIANI V. ARABA.
4. Mortgage of an equitable interest
5. Equitable Mortgage of Registered Land – applies in the RTL areas of Lagos.
It is done by deposit of land certificate and completing the relevant Form
which is Form 15-SECTION 59 (1) RTL, LAGOS.”
6. Equitable Charge of the Mortgagor’s Property – OGUNDAINI V. ARABA

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 This does not create an estate (proprietary right), but merely gives a right to
repayment of the debt or other discharge of other obligation/burden in respect of which
the property stand charged. Comment [g61]: an equitable chargee
cannot himself exercise a power of sale or
appoint a receiver in the absence of a deed.
ADVANTAGES OF EQUITABLE MORTGAGE
1. Where loan is for little amount of money
2. Where the period of repayment is short
3. It is easier to create than legal mortgage
4. It is not affected by the covenant in the head lease.
5. Creation of Successive equitable mortgages are possible
6. It encourages uniformity in the CA and the PC & L States.

DISADVANTAGES
1. Unless where the two or any of the remedial devices of declaration of trust or
creation of power of attorney are inserted, the mortgagee has difficulty in
transferring/selling legal mortgage to third party.
2. The mortgagee is not entitled to the title documents.
3. The mortgagee is not entitled to the benefits of the covenants in the head lease
and there is no privity of estate between the head-lessor and the mortgagee.
4. The power of sale of the mortgagee can only be exercised by the mortgage upon
a court order
5. There is no priority over a legal mortgage
6. There is no legal protection of mortgagee’s interest.

ACTIVITY
Using case studies 1 and 3 (the loan of N50 million from zenith draft a search report and
a covering letter.
See sample draft of a search report conducted on a property to be used as collateral
security for a mortgage loan from a bank below:

GABRIELLA NDU & CO

BARRISTERS AND SOLICITORS
NO. 15 LOKOJA STREET IKEJA
LAGOS STATE
OUR REF:
DATE: 20 MAY, 2014

The Bank Manager

Zenith Bank Plc
No. 23 Marina
Lagos State.
Dear Sir,
SEARCH REPORT CONDUCTED ON PROPERTY REGISTERED
AS 12/12/6532 AT THE LANDS REGISTRY IBADAN,
OYO STATE
Sequel to your briefing our Firm to conduct a search on the above
property, we are pleased to inform you that the search has been carried out
and a copy of the Search report is attached below:

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1. DATE OF SEARCH: 17 May, 2014
2. PLACE OF SEARCH: Lands Registry Ibadan Oyo state
3. NAME OF REGISTERED OWNER: Chief Mrs. Remi Yakossi
4. NAME OF BORROWER: Chief Nosa Okon of No. 16 makurdi Close Kwara
State.
5. DESCRIPTION OF THE PROPERTY: No. 12 Croker Street Oyo State.
6. NATURE OF INTEREST: right of Occupancy No. 6532 dated 12/07/2004 registered
as 12/12/6532 at the Lands Registry Ibadan Oyo State.
7. ENCUMBRANCES: Nill
8. COMMENTS/ OBSERVATIONS: The property is a good security and it is
unencumbered
Yours faithfully,

Bassey Olakunle, Esq.

(Principal Partner)
For: Bassey Olakunle 7 Co.
External Solicitors to Zenith Bank Plc

COVENANTS IN MORTGAGES
Covenants in mortgages are specific agreements between the parties reached to
regulate the relationship between the mortgagor and mortgagee in a particular
mortgage transaction.
1. COVENANT TO REPAY THE PRINCIPAL AND INTEREST AT A FIXED DATE
 The mortgage sum is the principal amount advanced to the mortgagor by the
mortgagee while the interest is the sum accruing on the principal over a period of
time. This covenant must be included in a deed of mortgage.
 Where the mortgagee is a bank, the rule is that parties are bound by the rate of
interest they have agreed, where there is no express agreement, the bank is
entitled to charge interest
a) basis of customs and usages, or
b) on the ground that the customers is impliedly consented where he allowed
his account to be debited and he did not protest.
 A bank will not be able to unilaterally charge compound interest OWONIBOYS
TECH SERVIES V.UBN-compound interest is chargeable when agreed-UBN
V.OZIGI

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 ESSENCE OF THE COVENANT
1. to aid the MORTGAGEE to know when his power of sale may arise. Twentieth
Century Banking Corporation Ltd v. Wilkinson & anor.
2. It also shows what the mortgagee’s cause of action will be either failure to pay the
principal sum or interest etc
3. Where the legal due date has not passed, any action will be held to be pre-mature.
4. To prevent statute of limitation

DRAFT
This covenant to repay principal & interest must be drafted as a positive inducement
and not a negative inducement.NB- IT SHOULD NOT BE PUNITIVE

EXAMPLE 1
The courts will frown at a covenant drafted thus:
“the interest payable is 15% but where mortgagor fails to pay on time, the interest shall
be 20%. The courts of equity will interpret this clause as a penalty, thus it would not be
upheld.
Therefore, a better clause would go thus: the interest payable is 20% but where
the mortgagor pays promptly, it will be reduced to 15%

2. COVENANT TO INSURE THE PROPERTY

This covenant is to provide for what would happen in the event of any damages or
destruction to the property.
This is very important as the transaction is dependent on the mortgage property. Any
damage or destruction to the property would adversely affect the rights of the parties.
The mortgagee must ensure that the property is insured.

CONTENTS OF THE INSURANCE COVENANT

The covenant should contain the following things:
a. The insurance company (REPUTABLE)
b. Date of commencement of the insurance policy.
c. The risk to be insured against

WHAT DETERMINES THE RISK TO BE INSURED AGAINST ARE VIZ:

 The use to which the property is put
 The location of the property , flooded area, erosion prone
 The nature of the property itself – developed property or
 Applicable Government policy
d. The premium and who is to pay the premium
The premium payable must not be outrageous S.130PCLL;S.23 CA
e. The person to insure the property and whether to insure in his name or name of
the other party.
f. The application of the insurance money in the event of damage.

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WHO SHOULD INSURE?
THE MORTGAGEE usually insure the property against damage by fire,etc and the
premiums paid for such insurance shall be a charge on the mortgaged property in
addition to the mortgage money.-Section 123(1)(II) PCL, section 19(1(ii) CA
However, where the mortgagor insures, mortgagee should be granted a power of
attorney by the mortgagor as his lawful attorney in order to be able to collect the
insurance money upon damage of the property.

APPLICATION OF THE INSURANCE MONEY

The mortgagee upon receipt of the insurance money would disburse the funds,
 first to pay off the principal sum and interest owned him by the mortgagor
and
 then render the remaining amount to the mortgagor
. As such, the mortgagee would not have to wait for reinstatement of the damaged
property.
EFFECT OF FAILURE TO INSERT INSURANCE COVENANT-the mortgagee cannot
compel the mortgagor to surrender the insurance money to him-HALIFAX SOCIETY
V.KEIGHLY.

3. COVENANT TO CONSOLIDATE DIFFERENT MORTGAGES

Consolidation of mortgages occur where a mortgagor uses different properties to secure
a loan of money from a mortgagee.
The mortgagee tries to prevent him from redeeming the properties separately.
These mortgages as described above are consolidated in the sense that the mortgagor
will not be allowed to redeem any of the properties without also redeeming the other
securities.
Generally, the law leans against consolidation of mortgages except where the
parties expressly agreed to it in their deed of mortgage.
SECTIONS 17 CA, 115PCL, 114 ABIA STATE LAW OF PROPERTY all prohibit
consolidation of mortgage.IT IS ALLOWED BY LAGOS MORTGAGE AND PROPERTY
LAW 2012
Where parties expressly agree to allow for consolidation four things MUST EXIST.
a. It must be the same mortgagor
b. It must be the same mortgagee
c. The legal due date must have passed
d. It must have been expressly agreed by the parties and stated in the deed of
mortgage.
RATIONALE- IT NEGATES OR RE

4. OBSERVANCE AND PERFORMANCE OF COVENANTS IN THE

HEADLEASE.
A lease or a sub-lease usually have attendant covenants e.g. covenant on use, to pay
rents, not to sublet, repairs etc.
The mortgagor is under an obligation to observe these covenants.

110
Where the mortgagor mortgages the property, he should agree with the mortgagee to
ensure that the mortgagee observes the covenants in the headlease. This is
important especially in a mortgage by assignment
NB-Where the mortgagee does not wish to be liable for observing the covenants and
conditions in the headlease, the parties may covenant that the mortgagor continues to
be liable to perform the covenants in the headlease.

5. Covenant to Repair
This deals with the reinstatement of parts that have fallen into disrepairs.
RATIONALE-Maintains the value of the property and prevents depreciation must be
maintained.
This would affect its value where the mortgagee is to exercise his power of sale. Thus,
this covenant should be primary concern to the mortgagee.
The parties should agree on who is to repair, and list out the places to be
repaired. All these are to be included in a schedule to the mortgage deed.
NOTE-It is advisable that the mortgagee carried out the repairs and subsequently
charge the cost of repairs on the mortgage property.
However, repair does not include rebuilding the property.-NIGERIAN LOAN
&MORTGAGE CO V.AJETUNMOBI.

6. COVENANT TO CREATE LEASE AND SUB-LEASE ON THE PROPERTY

This largely depends on whether the lease was created BEFORE OR AFTER the
mortgage.
If there was a lease on the property Before the mortgage the lease will be
binding on the mortgagor and even on subsequent purchaser and the mortgagee
will not be entitled to rent.
Where the lease is created AFTER the mortgage, then the determining factor is
whether either party is in possession in which case that party in possession of the
mortgaged property can create a lease binding on the other.
Section 18(1) CA, section 121(1) PCL provides thus;
A mortgagor of land while in possession shall, as against every incumbrancer, have
power to make from time to time any such lease of the mortgage land or any part
thereof.
POINT A SOLICITOR SHOULD NOTE
Where the mortgagor is in possession, the mortgagee’s solicitor should ensure that
the covenant is couched in such a way as to provide that mortgagee’s consent in
writing should be first had and obtained before the mortgagor can lease or sub-
lease the proprety (however, such consent is not to be unreasonably withheld in case
of a responsible and respectably person).

7. RESTRICTION OF REDEMPTION FOR A FIXED TERM CERTAIN

What this means is that the mortgagor’s right of redemption may be expressed to
be inoperative for a certain period and only to become operative from a certain time
after the creation of the mortgage.

111
 e.g. the right of redemption may not be operative during the first two years
after the creation of the mortgage but as from the third year, the mortgagor can redeem
his property.
The mortgagee may push for the insertion of these clauses in the agreement in
order to enjoy the interest which will accrue on the principal sum where the
mortgagor does not redeem soon after the creation of the mortgage.

WHAT IS THE ATTITUDE OF THE COURTS TO AN AGREEMENT WHERE THE

MORTGAGE IS EXPRESSED TO BE IRREDEEMABLE FOR A TERM CERTAIN.
This is a negation of the right of the mortgagor to redeem his property at any time
he is ready with the principal sum and interest already accrued.

CONDITIONS
However, it may be allowed upon the following considered.
a. WHAT IS THE LENGTH OF TIME?
Where the length of time is short, the court may allow it. Where it is fairly long the
court may not allow it.
B. WHO ARE THE PARTIES?
If the mortgagor is a corporate body made up of members who are elites and
knowledgeable, the court will allow the restriction on the ground that the members
ought to know the implications of such restriction.
Where however, it is an individual, the court may be sympathetic towards him.
c. What type of mortgage is created?
d. What are the circumstances surrounding the creation of the mortgage?
In the case of MULTI SERVICE BANKING V. MERDEN, a restriction of
redemption for a period of 10 years was held not to be too long. SAMUEL V. JARRAH

UP-STAMPING
Up-stamping of mortgages refers to the practice or process of payment of additional
stamp duties on a mortgage document in satisfaction of the increased facility granted
over an earlier mortgage.
This exists where a mortgagor had earlier borrow money from a mortgagee using
a particular property as security for a loan. If subsequently the mortgagor wants
additional loan from the same mortgagee using the same property as security.
What is required in this instance, is that the mortgagee should draft a new
agreement and the document will be up-stamped.
Simply put, up-stamping is the act of paying additional stamp duty on the new
mortgage or loan agreement.OWONI BOYS TECHNICALSERVICES V. UBN

FEATURES OF UP-STAMPING
i. The property is the same
ii. The parties are the same
iii. The new facility is different
iv. Additional stamp duties in the new facility

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NB: The consent of the Governor is not required in granting the new facility so long as
his consent had been obtain when the first mortgage was created. Bank of the North v.
Babatunde.
Consent of the Governor is required in respect of alienation of interest in land
and not for any additional facility .OWONIBOYS TECH SERVICES LTD V. UNION
BANK OF NIGERIA PLC.
Even where the Governor’s consent was granted under a law which had ceased to exist
e.g. Land Tenure Law, no further consent of the Governor is required for up-stamping
ADEPATE V. BABATUNDE.

THE EFFECTS OF UP-STAMPING A MORTGAGE ARE:

1. A fresh consent of the Governor is not needed to be obtained
2. A new Deed of Mortgage is not needed to be executed
3. The earlier Deed of Mortgage executed by the parties is only taken for payment of
stamp duty on the additional loan. OWONIBOYS TECH SERVICES V. UBN

DISTINGUISH BETWEEN CONSOLIDATION, SUBSEQUENT MORTGAGES AND

UP-STAMPING.
 For consolidation, same parties, different properties; the mortgagor is barred from
redeeming the property separately.
 For subsequent mortgagee, only in PCL States, sale for different parties, the
same property.
 For up-stamping same parties, same property additional facility, no need for
fresh Governor’s consent on addition facility

MORTGAGEE’S REMEDIES
Remedies are cumulative and not necessarily alternative. OLORI MOTORS LTD. V.
UNION BANK PLC.
The mortgagee has the option of taking any of the remedies at the same time of his
choice.

FACTORS DETERMINING CHOICE OF REMEDY

The particular remedy taken would depend on:
a. What the mortgagee is claiming, is it the principal or the interest?
b. The type of mortgage, whether it is legal or equity or the interest?

THE RIGHTS AND REMEDIES OF A LEGAL MORTGAGEE

a. Right of action to recover the mortgage sum and interest in Court
b. Right to sale of the mortgaged property
c. Action for foreclosure
d. Right of appointment of receiver
e. Right to take possession of the property
f. Right to keep the title Deeds

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 g. Right to consolidation (EXPRESS AGREEMENT)
Section 19(1) Conveyancing Act

THE RIGHTS OF THE EQUITABLE MORTGAGEE

1. Right of sale of the mortgaged property
This right will only exist if the following conditions are present:
a. The mortgage is by Deed
b. ;The remedial devices/clauses of power of attorney /trust declaration
are included as terms in the Deed
c. There is no contrary intention of the parties
2. An action for specific performance
3. Action for foreclosure
4. Appointment of receiver
5. Right of action in Court to recover the mortgage sum and interest

RIGHT TO TAKE POSSESSION

A legal mortgagee has a right to take possession of the mortgaged property upon
execution of the mortgage … This right is IMMEDIATE, not contingent upon the default Comment [g62]: Can be done after
governors consent
of payment of the mortgage sum. Section 19(1)(10) CA, section 123 PCL He cannot
be compelled to get the highest rent on the property.

WHEN SHOULD A MORTGAGEE TAKE POSSESSION

a. where the property is being squandered
b. Fear of destruction or depreciation is imminent
c. where there is need to intercept the profit

REASONS WHY IT IS NOT ADVISABLE TO TAKE POSSESSION

a. Equity imposes on him a strict liability to account for the profits on the property.
b. He will be liable for negligence or wilful default for any sum not recovered.
c. He is also liable for any deterioration or neglect or disrepair of the property.
d. He cannot make profit from the property; he can only realise his security.

APPOINTMENT OF RECEIVER
A receiver is an independent, uninterested third party appointed to manage
the mortgaged property. ADETONA & ANOR V. ZENITH INT’S BANK LTD
NB: The power to appoint a receiver need not be expressly stated in the deed once it
is a legal mortgage.
Where it is an Equitable Mortgage Created By Deed, the deed should provide for the
power to appoint a receiver. Where there is no such clause, the mortgagee may
apply to court for one to be appointed.
NB-REMUNERATION OF RECIEVER is from the income of the mortgage
property(MORTGAGOR PAYS)

114
POWERS, DUTIES AND RIGHTS OF A RECEIVER
SECTION 24 CA, SECTION 131 PCL
a. The receiver shall have the power to demand and recover all the income of
the property of which he is appointed receiver.
b. He shall be entitled to remuneration out of the money received by him to pay
taxes, rates and other outgoings in respect of the property.
c. To pay interest accruing in respect of any principal money due under
mortgage.
d. To pay the residue of the money received by him to the person who is
entitled to receive the income of the mortgaged property.
A receiver must act in good faith. Where he colludes with a person to sell the property at
a gross undervalue, the sale will be set aside. -WEST AFRICAN BREWERIES LTD V.
SAVANNAH VENTURES LTD.

ACTION IN COURT TO RECOVER PRINCIPAL AND INTEREST

The mortgagee can institute an action in court against the mortgagor to claim the
principal sum advanced to the mortgagor and the interest that has accrued on it.
This can be by way of summary judgment or judgment under the undefended list.
(OR.11&21)

ACTION FOR ORDER OF SPECIFIC PERFORMANCE

This remedy is available to an EQUITABLE MORTGAGEE.
This would arise where the equitable mortgagor fails, refuses or neglects to complete
documentation of the mortgage agreement.
The court would give an order mandating the mortgagor to complete documentation,
thus the legal interest in the property will be passed to the mortgagee (so he can
exercise power of sale).
NB: The equitable mortgagee has no legal estate to transfer as such, he cannot
exercise a power of sale hence this action for specific performance.
Where the mortgagor refuses, neglects or fails to complete the documentation, the court
will then order an officer of the court to execute a legal mortgage upon with the
mortgagee …
NB- THERE MUST BE PART PERFORMANCE.

ON PART – PERFORMANCE
The part-performance on the part of the mortgagee is the actual handing over of the
loan to the mortgagor.
On The mortgagor’s part, the part-performance is the deposit of his title deeds with
the mortgagee and intention to creates a legal mortgage.-OGUNDIANI V. ARABA

STATUTORY POWER OF SALE

The power and right of a mortgagee to sell property is central to legal mortgages
created by deed. It is automatic. The mortgagee need not go to court to enforce it.

115
However, for the mortgagee to be entitled to exercise its power of sale, the power must
HAVE ARISEN and become EXERCISABLE. (2 conditions)
For the power of sale to ARISE the following three conditions MUST EXIST:
a) The mortgage must have been created by a deed;
b) There must be no contrary intention against sale in the mortgage deed;
and
c) The legal due date, which is the date of redemption of the mortgage must
have passed.-
Section 19(1) CA, section 123 PCL, Section 122(1) Abia State Law of Property
NB: These conditions are conjunctive/ cumulative. NHDS LTD. V. MUMMUNI
Even where power of sale has arisen, the mortgagee is still NOT entitled to sell the
mortgaged property unless and until the power has become exercisable. . NAB Ltd v.
UBA Plc.
The power becomes exercisable when ANY of the three conditions in SECTION 20 OF
THE CA AND 125 OF THE P & CL is satisfied, which is that:
a. A written Notice to the mortgagor to pay the loan sum had been served on him
and after a period of 3 months he is still in default, or
b. The interest/ mortgage sum are in arrears after becoming due for two months,
or
c. There has been a breach of a fundamental provision contained in the mortgage
deed or in the Act/Law and on the part of the mortgagor-OKONKWO V. ACB

FORM OF NOTICE
 NB-The requirement of notice to the mortgagor includes notice to persons
deriving title through him, for example, where there is a subsequent
mortgage.
 The notice need not fix the time of repayment.
 It is sufficient if it request that the mortgagor should pay the loan.
 The date of the service of the notice is excluded in the computation of time for
this purpose.
 Where the mortgagor is in default of payment of any instalment or interest is in
arrears, It is not a defence that substantial part of the loan has been paid.-
OKAFOR & SONS V. NHDS LTD
PLEASE NOTE
 Where the power of sale has not arisen, the mortgagee/lender has no right
to sell.
 If the right of sale has arisen but it has not become exercisable and the
property used as security is sold, the mortgagor can apply to the Court to set
aside the sale EXCEPT it was sold to a bona fide purchaser for value without
notice, but the Court can only grant damages to the mortgagor.

PROTECTION OF INNOCENT PURCHASER

A purchaser who purchases a property BEFORE the power of sale arises will not
acquire a good title.
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A mortgagee’s power of sale becomes exercisable if it has arisen and once it has so
arisen, the title of a subsequent purchaser without notice AFTER POS will not be
affected by its improper or irregular exercise and the sale will be regarded as VALID.
Nigeria Advertising Services Ltd v. UBA.
NB-Sale extinguishes the mortgagor’s right of redemption.

CONDUCT OF SALE
a. Sale by public auction
b. Sale by private contract
For sale by public auction, 7 DAYS PUBLIC NOTICE OF INTENDED AUCTION must
be given; section 17 Auctioneer’s Law
Where the sale was made at an undervalue, it does not necessarily evidence bad faith.
However, where the mortgagee sells to himself directly or through an agent, to his
cronies, relations, the court will infer bad faith. Comment [g63]: MORTGAGEE HERE IS NOT
AN AGENT
A mortgagee is not an agent or trustee for the mortgagor during power of sale.
A mortgagee is only required by law to obtain a property price and not the best price for
the property when exercising his power of sale.
To vitiate the sale, it must be shown that the sale was fraudulent Ihekwoaba v.
ACB;Okonkwo v . CCB;EKA ETHEH V. NHDS

A SALE OF THE PROPERTY USED AS SECURITY MAY BE SET ASIDE ON THE

FOLLOWING GROUNDS:
1. That the mortgagor has no good title ab initio – Alli v. Ikusebiala
2. The Mortgage transaction was not registered if the property is in the RTL
district
3. There is fraud/ collusion between the mortgagee and the purchaser
4. The right of sale has not arisen or become exercisable.
5. Sale was effected after payment of out-standing mortgage sum and
interest.
6. Where the parties agreed on a different mode of sale.
7. Where the mortgagor can validly rely on the plea of estoppels.
N.B under No. 3 the following conditions must be fulfilled:
1. The mortgagee must not sale to itself, privy, servant or agent.-before sale
2. The Bank must not collude with the purchaser-before sale
3. Mortgagee must act bona fide- during the sale
4. Must not sale in negligible price or gross under value.- after sale Comment [KUE64]: WHAT AMOUNTS TO
GROSS UNDER VALUE DEPENDS ON THE FACTS
Also N.B. OF EACH CASE
1. The implication of the principle that mortgagee is not
agent/trustee of the mortgagor before or during sale but
after sale.
2. Mortgagee becomes agent/trustee of the mortgagor
inrespect of the application of the procceds of sale.
3. The effect of purchase by a bona fide purchaser for
value without notice

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A SALE OF THE PROPERTY USED AS SECURITY FOR A MORTGAGE WILL NOT
BE SET ASIDE ON THE FOLLOWING GROUNDS:
1. It was sold at a low price, except it was sold at a gross undervalue and there is fraud
in it, S. 183 of the PCL and OKONKWO V. ACB
2. The outstanding sum is contested by the parties
3. The sale was motivated by ill-will
4. The mortgagor has paid a part of the loan
5. The mortgage sum and interest is paid after the sale
6. An Order of the Court was not obtained before the sale- UBN LTD. V. OLORI
MOTORS LTD
7. The power of sale was improperly exercised.

APPLICATION OF PROCEEDS OF SALE

Where the sale is completed, the mortgagee should use the amount to satisfy
mortgagor’s indebtedness to him and if there is another mortgage, to use the balance to
settle the other mortgage otherwise, he must return the balance of the sale to the
mortgagor.

This is because the mortgagee IS A TRUSTEE OF THE PROCEEDS OF SALE. Thus,

the mortgagor can sue the mortgagee for the surplus where he refuses to give it.
Proceeds of sale may be applied in the following order:
i. Pay up all mortgages having priority
ii. Pay commission to the auctioneer and other costs of sale
iii. Pay up outstanding interests
iv. Pay up outstanding mortgage sum
v. Pay balance to persons entitled to equity of redemption.
vi. Settle subsequent mortgages Section 21(3) CA, section 127 PCL.VISIONI LTD
V. NBN
NB: Where the proceeds of sale do not satisfy the principal and the interest, the
mortgagee can sue the mortgagor to recover the balance.
MCQ-Who pays cost of sale-MORTGAGOR PAYS-motgagee is paying it on his
behalf

Action for foreclosure

This is an Order of Court extinguishing the mortgagor’s equity of redemption or
terminating all the mortgagor’s right over the property. The Order is first made nisi (in
the interim) and then it becomes absolute after 6 months.

CONDITIONS FOR FORECLOSURE:

1. The mortgagor must have defaulted.
2. The mortgagee must have applied to the court.
3. They must have given order of foreclosure (nisi).
4. The order must have become absolute.

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RE-OPENING A FORECLOSURE ORDER ABSOLUTE
Instances where the mortgagor can apply for the order of foreclosure to be set aside:
1. Interest of justice in the eyes of a reasonable man.
2. Just and equitable grounds.
3. If the property is of special value to the owner e.g. where a gift was made to a
person to the effect that it should not be sold or transferred to another person. The
property is a mere life interest.
4. Where the value of the property is far higher than the mortgage sum and interest.
5. Where the mortgagee, after the foreclosure order has become absolute, sold it and
after selling it has realize that the amount sold is not enough, the mortgagee is
entitle to go back to court to recover the balance. In this case, the mortgagor is now
entitled for the order of foreclosure to be set aside entirely.
6. The mortgagee acted mala fide in obtaining the order nisi
7. Fraud
8. That there are conditions beyond his control preventing him from paying the loan
sum

THE CONDITIONS THE MORTGAGOR/APPLICANT SEEKING TO RE-OPEN THE

FORECLOSURE ORDER MUST SATISFY TO SUCCEED IN THE APPLICATION
ARE:
1. That he is not guilty of delay i.e he must bring the application timeously and
within reasonable time.
2. He must be ready to pay the mortgaged sum and interest at the time of making the
application in court.
3. He must give good reasons why he was not able to pay the sum as at when due.
4. The property value is very high above the amount outstanding in the repayment of
the loan
5. The property has not been sold by the mortgagee
6. The action is brought in good faith
7. Right of appointment of receiver

TRANSFER OF MORTGAGES
Section 27 CA and 134 PC L provide for the power of the mortgagee to transfer the
mortgage or the benefit of the mortgage to a transferee by executing a Deed
expressed to be made by way of statutory transfer.

THE CONSEQUENCES OF SUCH TRANSFER are:

1. The transferee acquires the right to demand, sue for, recover, and give receipt
for, the mortgage money or the unpaid part of it and interest thereon (if any) as
may be due.
2. The transferee acquires the right to sue on all covenants with the mortgagee, and
the right to exercise all powers of the mortgagee.

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 3. The transferee acquires all the estates and interests in the mortgaged property
then vested in the mortgagee subject to redemption of the loan.

MORTGAGOR’S REMEDIES AND RIGHTS

 EQUITY OF REDEMPTION
Equity of redemption is an estate in land that could be sold, disposed of, or even
mortgaged.
This right can never be clogged either expressly or impliedly by agreement in the
Mortgage Deed-SANTLEY V, WILDE; FAIRCLOUGH V SWAN BREWERIES CO. Comment [g65]: ONCE A MORTGAGE
ALWAYS A MORTGAGE
LTD.

CIRCUMSTANCES WHEN THE EQUITY OF REDEMPTION WILL BE

EXTINGUISHED
a. The right of sale has been exercised
b. A foreclosure Order absolute has been made
c. The mortgage sum has been redeemed
 LEGAL RIGHT TO REDEEM
This is the period stated in the Loan agreement/Mortgage Deed for the repayment of
the loan sum known as the legal due date. Upon the expiration of the specification
date for payment, the legal right to redeem expires.
 EQUITABLE RIGHT TO REDEEM-
The equitable right to redeem is the right granted by equity to the mortgagor to still
recover his security by paying the mortgage sum and interest although the time fixed for
the payment of the money has passed.-YARO V. AREWA CONST. LTD .

DISCHARGE OF MORTGAGES
1. Legal mortgage (by way of sub-demise or assignment) in CA States is
discharged by Deed of Discharge, Deed of surrender or Deed of Release.
This Deed of Discharge, Release or Surrender is registrable in the lands registry
where the mortgage was registered.
2. Equitable mortgages are discharged by receipt of payment of principal and
interest. NB: Where the payment is made to the mortgagor’s solicitor or
agent, the receipt must be by Deed.
3. Legal mortgage created by charge by deed under PCL states is discharged by
way of statutory receipt. These receipts are not registrable, hence, the
encumbrance would still be reflected on the property at the lands registry.

4. A charge or sub-charge under RTL is discharged by completing and filing

FORM 6-RELEASEOF CHARGE at the Lands registry plus any other condition
necessary depending of its mode of creation.
5. Where the mortgagor is a company, A memorandum of satisfaction is to be
executed in its favour upon re-payment of the sum. Section 204 CAMA.Also, the
company is to complete and

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6. Discharge by court: Despite the covenant restricting redemption, the mortgagor
can still redeem. He can apply to court, the court will order that the mortgage
money be paid into court upon the payment, the mortgage is
discharged.(MOTION EXPARTE)
NB: You can also endorse the release on the deed of legal mortgage SECTION 135 of
the P & CL, 1959
Where a third party pays the mortgage sum, the rights of mortgagee transfers to
the third party, the mortgagor be indebted to the 3rd party and the mortgage continues.
The mortgagor may decide to sell his property, use the proceeds to the loan.
In this instance, there should be a tripartite agreement between the mortgagor and
mortgagee as “the Assignors” and the purchaser as “the Assignee”.

In CA States
The mere fact that the mortgage sum has been repaid does not discharge the
mortgage. The mortgagee holds the interest in trust for the mortgagor pending when a
deed of release has been executed.
In PCL States
The mere fact that mortgage money has been repaid absolute and instantly discharges
the mortgage.
NB: As a solicitor, ensure that you retrieve all the title documents from the
mortgagee upon discharge of the mortgage. Where the mortgagee refuses to return
the title deed he can be sued for detinue.

PERFECTION OF LEGAL MORTGAGE

Section 22 LUA
The consent of the Governor must be sought and obtained for the creation of a legal
mortgage.
Failure to obtain the consent of the Governor before actual mortgage itself makes the
transaction null and void. Savannah Bank v. Ajilo
NB-However, AT THE AGREEMENT/CONTRACT STAGE OF PROPERTY
TRANSACTIONS the consent of the Governor is not required, but it is only required at
the conveyance stage.

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 DOCUMENTS REQUIRED TO APPLY FOR GOVERNOR’S CONSENT
 Application for consent-FORM 1C
 Duly executed deed of mortgage
 Tax clearance certificates of both parties
 Receipts of payment of ground rent, consent fee, inspection fee, tenement rate,
and other charges imposed on the property.

INSTANCES WHERE THE GOVERNOR’S CONSENT IS NOT NECESSARY TO

PERFECT A MORTGAGE
i. Equitable mortgages
ii. Up-stamping of mortgage
iii. Re-conveyance of the mortgaged property by a Deed of Conveyance, Release,
Surrender or Discharge
iv. Where consent was obtained when creating an equitable mortgage and was later
converted to a legal mortgage
STAMPING
A deed of legal mortgage is required to be stamped as evidence of payment of stamp
duties (taxes) imposed by the Stamp Duties Act. The duty paid on mortgages is ad
valorem (according to the value of the transaction).
A document is required to be stamped within 30 days of its execution section 23 SDA.

REGISTRATION -Section 2(1) Land Instrument Registration Law.

A deed is to be registered within 60 days of its execution
EFFECT OF NON REGISTERATION OF MORTGAGE
If a deed of mortgage is not registered,
a. The instrument is inadmissible in evidence (to prove title) section 15 LIRL,
OGUNBAMBI V. ABOWOH.It is only admissible to prove payment of money
b. An unregistered deed of mortgage loses priority where there is conflict of
interest.-FAKOYA V. ST. PAUL CHURCH SHAGAMU;Section 16 LIRL, OKOYE V.
DUMEZ
c. If the property falls within the registration district and it is not registered WITHIN
TWO MONTHS of the execution of the deed of mortgage, the transaction will be
VOID.IDOWU V. ONASHILE
ONASHILE V. BARDAYS BANK DCO.

DOCUMENTS RQUIRED TO PERFECT/PROCESS LEGAL MORTGAGE OF LAND

1. The original title documents.
2. Three (3) years tax clearance certificate of the mortgagor (and the surety, if any).
3. A receipt of payment of the current ground rent on the property to be mortgaged.
4. A duly completed application for Governor’s consent Form – Form 1C
5. A copy of the approved plan of the property.
6. A copy of the valuation report of the property.
7. Approved building plan of the property
8. Insurance policy of the property

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 9. The mortgage deed itself

WHERE THE MORTGAGOR IS COMPANY, THE FOLLOWING ADDITIONAL

DOCUMENTS ARE REQUIRED BY CAC
10. A Certified true copy of the Memorandum and Articles of Association of the
Company.
11. A copy of the resolution of the Board of Directors authorising the mortgage.
12. A copy of the Certificate of Incorporation of the Company.
NB: Where a company is the mortgagor, the mortgage document or charge must be
registered within 90 days of its execution by filing FORM CAC 8 sectio

REVISION QUESTIONS
Chief Eriri by a legal mortgage by sub-demise used his property at No. 2 Orube
Street Benin City and No. 5 Alor Street Fegge Onitsha to secure the loan of N5 million
and N3 million respectively from Diamond Bank Plc.
He later obtained a loan of N6 million from the same bank using the property at
Onitsha without securing the consent of the Governor.
Chief Eriri agreed to pay the loan on 25th March, 2009. Now the Bank has
advertised for the sale of the securities. Advise both parties on the following:
b. Can the bank sell both properties and transfer whole interests of the mortgagor to
a purchaser.
Give reasons and proffer a solution if any:
c. When will the consent of Governor be irrelevant in a mortgage
d. State 5 documents required to procure consent in Lagos
e. State how a legal mortgage created over a property in Osogbo, Markurdi and
Victoria Island can be redeemed
f. State the particulars of information required to draft a standard deed of mortgage.

ANSWERS
a. For the property in Benin (PCL State) created by sub-demise, the Bank can be
seen because the reversionary interest and the title in the property has been
merged.
Section 112 PCL
For the property in Onitsha (CA State) created by sub-demise the bank cannot sell
ordinary but the solution would be to insert an irrevocable power by attorney or
declaration of trust in favour of the mortgagee to enable them sell.
b. Governor’s consent may be irrelevant in a mortgage where;
i. for equitable mortgages, the consent of the Governor is not required because it is
in the nature of an agreement to create a legal mortgage only.
OKUNEYE V. FBN PLC.
ii. Where the consent of the Governor was sought and obtained in the creation of
an equitable mortgage, no further or other consent will be required if a legal
mortgage is to be created over the same property.

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iii. Where consent of Governor was obtained when the mortgage was originally
created, no consent is required for up-stamping of the mortgage if further facility
is granted on it.
BON V. BABATUNDE
c. Original and copies of title document
Duly executed deed of mortgage
Receipts of all payments – ground rent, tenement
Tax clearance certificate of both parties
Application for consent
d. In Victoria Island, a legal mortgage is discharged by filling and completing FORM
6.
1. In Markurdi which is under CA, legal mortgage is discharged by deed of release,
Deed of Discharge or Deed of surrender
2. In Osogbo (PCL) sub-demise is discharged by Deed of Discharge or Deed of
Release, or Deed of Surrender
3. In PCL States, where charge is used to create legal mortgageIt is discharged by
a statutory receipt.

NB: If a company is a party to the mortgage transactions, It is created by filing FORM 8,

and discharged by filing FORM 9
e. The information required by a solicitor
The parties, the amount of money advanced, the property used as the repayment date,
covenants, in the mortgage, rate of inter-remedies in the event of default etc.

FURTHER CLASS ACTIVITIES.

1. Assuming there is an order of foreclosure and the value of the property cannot
cover the mortgagee sum and interest, what happens?
2. How does the mortgagee spend the proceeds of sale of mortgaged property
Find answer insider this note.
3. Where a sale is not property done, what is the right of the mortgagor against the
mortgagee?
4. Is under value sale simpliciter enough to vitiate a sale?
No except where it is shown that sale was at such as low value as to infer fraud.
5. Can the mortgagee resort to self help to go into possession.
6. What is the duty of the mortgagee where he collents rents
Where mortgagee collects rents in respect of the mortgaged property, then he is
bound to account strictly to the mortgagor.
7. What is the extent of the powers of a receiver?

PREPARATION OF MORTGAGE DEED

PARTICULARS NEEDED TO PREPARE A MORTGAGE DEED
1. particulars of the parties: Full names and addresses
2. date of commencement
3. duration of the mortgage

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 4. principal sum
5. interest rate
6. description of the mortgage property
7. the various covenants
8.
FORMAL PARTS OF A MORTGAGE DEED Comment [g66]: Formal parts of a Deed of
Legal Mortgage
1. Commencement: THIS MORTGAGE/THIS DEED OF MORTGAGE 1.Commencement
2. Date: Made the ……. day of ………………. 20… 2.Date
3.Parties
NB: A deed takes effect from the date of delivery not necessarily the date on the deed. 4.Recital ( it’s a must in mortgages)
5.Testatum which are two in number
3. Parties: BETWEEN…………… of ………………………… (the mortgagor) of the a.1st Testatum containing the consideration and
receipt clause
one part AND ……………………of ……………………. (the mortgagee) of the b.2nd Testatum containing the covenants to
other part. repay, the legal due date and its
commencement date
It is possible to have a third party, that is a guarantor or some person forwarding 6.Charges clause containing :
a.Covenant as to title /capacity
his property as security. b.Parcel clause
4. Recitals: THIS DEED RECITES AS FOLLOWS: c.Word of grant e.g. ‘ASSIGNS’/
‘CHARGES’/ ‘DEMISES’
The following facts should be recited, borrower’s title, the mortgagor’s property, d.Habendum (term)
7.Miscellaneous part containing the provisos
his desire to borrow and mortgagee’s agreement lend, guarantor’s agreement to as to redemption
8.Testimonium
guarantee the loan, Governor’s consist where necessary. 9.Execution
5. Testatum: NOW THIS DEED WITNESSES AS FOLLOWS” 10.Attestation
ACRONYM-
a. The undertaking by mortgagor to pay to pay to the mortgagee the principal
sum with interest on a named date.
b. The interest rate
c. The deed may also contain a second testatum, stating the capacity of the
mortgagor conveying as beneficial owner”

6. Provision for Redemption

7. Parties covenants
8. Testimonium: IN WITNESSES OF WHICH
9. Execution: Signed, sealed, and delivered by… If a company, COMMON SEAL
of… is affixed to this deed
10. Attestation: IN THE PRESENCE OF: Name, address, signature, and occupation
of witness.
If a company, IN THE PRESENCE OF: Director, secretary
11. Consent clause where required

THIS DEED OF LEGAL MORTGAGE is made this …. Day of ……….. 2014

BETWEEN Mrs. Loretta Ugochi of No. 56 Calabar Road Uyo Akwa Ibom State (‘The
Mortgagor’) of the one part
AND Global Trust Bank Plc a public company duly incorporated under the Companies
and Allied Matters Act with its registered office at No. 20 Calabar Road Uyo-Akwa Ibom
state (‘The Mortgagee’) of the other part

BACKGROUND:
1. The Mortgagor is the holder of a certificate of Occupancy no. 269713 dated
10/10/2008 situated at 12 Ikoyi Crescent Akure and registered as 19/19/1167 at the
Lands Registry office, Akure Ondo State.

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2. A loan Agreement between the Mortgagor and the Mortgagee where the sum of
three million naira (N3, 000, 000.00) was advanced to the mortgagor by the
Mortgagee was made on 13 day of April 2012 and dully executed.
3. The Mortgagor agreed in the Agreement to secure the repayment of the loan and
interest collected on the property covered by a certificate of occupancy No. 269713
dated 10/10/2008 and registered as 19/19/1167 at the Lands registry Akure Ondo
State.
4. The Mortgagor has agreed to take the sum of sixty million naira (N60, 000, 000.00)
loan and the Mortgagee has agreed to advance it using the said property as
security.
NOW in consideration of the sum of sixty million naira (N60, 000, 000.00) only paid to
the Mortgagor by the Mortgagee (the receipt of which the Mortgagor hereby
acknowledges)

NOW THIS DEED WITNESSES AS FOLLOWS:

1. The Mortgagor covenants to repay the principal of sixty million (N60, 000, 000.00)
only and the interest at 21 percent per annum or at 10 percent if he pays timously,
repayable on or before 20 January 2014.
2. The Mortgagor as BENEFICIAL OWNER hereby SUB-DEMISES to the mortgagor
ALL THAT PROPERTY at N0. 12 Ikoyi Crescent off Lokoja Road Akure Ondo State
covered by a Certificate of Occupancy No. 269713 dated 10/10/2008 and registered
as 19/19/1167 at the Lands Registry Office Akure Ondo state rightly described by
the survey plan attached to the First Schedule TO HOLD unto the Mortgagee for the
unexpired residue of the term granted under the Certificate of Occupancy less one
day.
PROVIDED always that if the mortgagor repays the principal and interest on the loan,
the mortgage property shall cease and the mortgagee shall re-convey the property to
the mortgagor at his cost.

IN WITNESS OF WHICH the Mortgagor have executed this deed of nortgage in the
manner below the day and year first above written.

FIRST SCHEDULE
SIGNED, SEALED AND DELIVERED
By the Mortgagor
Mrs. Loretta Ugochi …………………….
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date

THE COMMON SEAL OF GLOBAL TRUST BANK PLC (‘THE MORTGAGEE’) IS AFFIXED ON THIS
DEED THE ……. DAY OF ……….. 2014 AND DULY DELIVERED IN THE PRESENCE OF:
……………………….. …………………………………
Director Secretary

I CONSENT TO THIS LEGAL MORTGAGE

DATED THE …..DAY OF ……….2014

EXECUTIVE GOVERNOR OF ONDO STATE

TRIPARTITE DEED OF LEGAL MORTGAGE

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THIS DEED OF LEGAL MORTGAGE is made this …. Day of ……….. 2014
BETWEEN Chief Nosa Okon of No. 16 Makurdi Close Ilorin Kwara State (‘The
Mortgagor’) of the first part
AND Mrs. Loretta Ugochi of No. 56 Calabar Road Uyo Akwa Ibom State (‘The
Guarantor’) of the second part
AND Global Trust Bank Plc a public company dully incorporated under the
Companies and Allied Matters Act with its registered office at 10 Bambul Close Maitama
Abuja (‘The Mortgagee’) of the third part
BACKGROUND:
1. The Guarantor is the holder of a Certificate of Occupancy no. 26971 dated
10/10/2008 and registered as 19/19/1167 at the Lands Registry office, Akure Ondo
State.
2. A loan Agreement between the Mortgagor, Guarantor and the Mortgagee where the
sum of three million naira (N3, 000, 000.00) was advanced to the mortgagor by the
Mortgagee was made on 13 day of April 2012 and duly executed.
3. The Guarantor agreed in the Agreement to secure the repayment of the loan
collected by the Mortgagor on the property covered by a certificate of occupancy No.
26971 dated 10/10/2008 and registered as 19/19/1167 at the Lands registry Akure
Ondo State.
4. The Mortgagor has agreed to obtain the loan and the Mortgagee to advance it while
the Guarantor is standing as surety for the repayment of the loan using the said
property as security.
TESTATUM
The miscellaneous part- provisos/covenants
IN WITNESS OF WHICH the parties have executed this Deed in the manner below the
day and year first above written.
SCHEDULE
SIGNED, SEALED AND DELIVERED
By the Mortgagor
Chief Nosa Okon …………………….
IN THE PRESENCE OF:
Name:
Address:
Occupation:
Signature:
Date:

SIGNED, SEALED AND DELIVERED

By the Guarantor
Mrs. Loretta Ugochi …………………….

IN THE PRESENCE OF:

Name:
Address:
Occupation:
Signature:
Date:

The Common Seal of Global Trust Bank Plc (‘The Mortgagee’) is affixed on this Deed the ……. day of
……….. 2014 and duly delivered in the presence of:
……………………….. …………………………………
Director Secretary

I CONSENT TO THIS LEGAL MORTGAGE

DATED THE …..DAY OF ……….2014

EXECUTIVE GOVERNOR OF ONDO STATE

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 WEEK 14 SOLICITORS BILLING AND CHARGES FOR PROPERTY
TRANSACTIONS

THE APPLICABLE LAWS

Legal Practitioners Act.
Rules of Professional Conduct
Land Instrument Preparation Law
Legal Practitioners Remuneration for Legal Documentation and other Land Matters)
Order 1991.
Judicial authorities.

PRINCIPLES AND RULES GUIDING BILLING FOR SOLICITOR’S SERVICES

1. Only a legal practitioner has the exclusive right to prepare documents of transfer of
interest in land in Nigeria.
However, it is not in the exclusive preserve of a legal practitioner to draft a
will.
2. It is an offence for a non-lawyer to prepare a land instrument. Section 22(1)(b) LPA
3. A solicitor shall receive adequate remuneration for his services from the client – R.
48(1) RPC. The charges shall not be too high nor ridiculously low.
4. The solicitor may present his bill of charges to the client.
5. A legal practitioner shall not share his legal fees with a non-lawyer. R. 3(1)(c) RPC.

EXCEPTION
a. the payment of money as compensation to the estate/family of a deceased
lawyer for services rendered before his demise
b. payment to non-lawyer employees in retirement plan. Rule 53 RPC. Comment [g67]: Payment to secretary
6. A lawyer shall not enter into an agreement for, change or collect as illegal or
clearly excessive fee. Comment [g68]: Do not charde for non
legal work
7. Where a lawyer accepts a general or special retainership, he shall not advise on
or appear in any proceedings detrimental to the interest of the client paying the
retainer during, the period of the retainer. Rule 19(3) RPC.
8. A lawyer shall not enter into a contingent fee arrangement without first having
advised the client of the effect R 50)4).

TYPES OF FEES
1. SCALE FEE
These are fees charged under scales I and II legal practitioner (Remuneration for
documentation and other land matters) order in non-contentious matters. .Fees
here are fixed and can neither be disputed nor varied by the court.
2. FIXED FEE

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 This is fee charged for specified class of works, such as writing letters, writing a
will, incorporation of business entities. Fixed fee is charged for simple non-
contentious works and is usually a flat rate.
3. HOURLY RATE FEE
This is fee charged on hourly rate for the number of hours spent on the client’s
work. The time spent must be commensurate and reasonable to the work done.
4. PERCENTAGE FEE
This is fee charged based on the value of the transaction, the higher the value
the more the percentage charged and the lower the value the lower the
percentage charged. It is common in property transactions especially the sale of
land.
5. APPEARANCE FEE
This is fee charged for each appearance in court to represent a client. The
distance of the law firm from the court as well as the standing of the legal
practitioner at the Bar. Often determine the fee charged as appearance fee.
OKONEDO – EGBAREGBEMI V. JULIUS BERGER.
6. CONTINGENT OR SUCCESS –BASED FEE
This is fee charged after the success of the action. The solicitor agrees with the
client on the amount he will be paid based on the amount they actually recover.
Where no such amount is recovered, he may earn nothing.
Under the common law, contingent fees are prohibited, whereas it is banned
under Rule 50(2) RPC. For criminal matters. it is only permitted in civil cases.-R.50(1)
RPC

SCALE OF CHARGES
The legal practitioners (remuneration for legal documentation and other and matters)
order 1991 provides 3 scales of charges for legal documentation and land matters.
Scale 1 : This deals with
completed transactions of sale, purchase or mortgage.
NB: In mortgages, the solicitor to the mortgagor charges HIS FULL CHARGES as
computed according to the scale, while the solicitor to the MORTGAGEE IS entitled to
charge FULL CHARGES as computed according to the scale.
Where one solicitor acts for BOTH MORTGAGOR AND MORTGAGEE, he is
entitled to the full charges due to the mortgagee’s solicitor plus half of what would
be due to the mortgagor’s solicitor.
Scale II: These deals with leases and agreement for leases in which the
transaction have been completed.
NB: In leases, the LESSOR’S SOLICITOR is entitled to THE FULL CHARGES as
computed according to the scale, whereas THE LESSEE’S SOLICITOR would be
entitled TO HALF OF WHAT THE LESSOR’S SOLICITOR is entitled to …
Where ONE SOLICITOR ACTS FOR BOTH LESSOR AND LESSEE, he is
entitled to the FULL CHARGE DUE TO THE LESSOR’S SOLICITOR, PLUS HALF
OF WHAT IS DUE TO THE LESSER’S SOLICITOR i.e. FULL CHARGE of lessor’s
solicitors fees PLUS ¼ OF LESSEE’S MONEY.

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Scale III: These deals with all other legal documentation not provided for in scales I
and II. There is no specific amount fixed, the fees charge shall be fair and
reasonable.
PRINCIPLES FOR ASSESSMENT UNDER SCALE III
a. The complexity, novelty and difficulty of the matter
b. The skill, laobur, specialized knowledge, expertise and responsibility involved on
the part of the solicitor
c. Value of the property involved
d. The number and importance of the documents prepared
e. The importance attached to the transaction by the client
f. Places to be visited where the transaction or a part of it will take place.
g. The time expended by the lawyer in the transaction
h. Special exertion of devotion towards that transaction.

PROCEDURE FOR RECOVERY OF PROFESSIONAL FEES

The fees owed a solicitor by clients is debt which is recoverable.
Step 1
It is advisable that the solicitor should first explore any of the alternative dispute
resolution mechanisms (ADR)
Persuasion, mediation, conciliation, negotiation and arbitration.

REASONS FOR ADOPTING ADR

 Litigation of fees will lead to loss of clients
 I t strains the relationship with the client
 To avoid lengthy trail
 Resources and energy will further be dissipated and wasted
 It discourages potential clients from briefing the solicitor

Step 2
Where the solicitor has explored ADR options to no avail, he may sue for his fees
in court.
Section 16-19 IPA.

THERE ARE 3 IMPORTANT AND MANDATORY THINGS WHICH A SOLICITOR

MUST DO IN ORDER TO RECOVER HIS CHARGES FROM A DEFAULTING CLIENT
VIZ:
1. He must prepare a Bill of charges which should set out the particulars of the
principal items of his claim.
2. He must serve his client with the bill of charges
3. He must allow a period of ONE MONTH TO ELAPSE FROM THE DATE THE
BILL WAS SERVED before the action is commenced. SECTION 16(1)(2) LPA.
These three conditions are used conjunctively and not conjunctively. They are
mandatory and must be complied with fees not only bad but incurably bad. FBN v.
Adoma – Egba.

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 BILL OF CHARGES
Charges mean any charges whether by way of fees, disbursement expenses or
otherwise in respect of anything done by a legal practice in his capacity as a legal
practitioner. Section 19(1) LPA.
The purpose of the bill of charges is that it helps the client to know what he owes
the solicitor and also helps the taxing authority to compute the taxes payable by the
solicitor.
The Bill of charges must be signed by the legal practitioner Question: Can a firm
sing in its name?
The courts have held that a firm is not a person known to law. In Okafor v.
Nweke, the Supreme Court held that J.H.C. Okolo San and Co is not a legal/practitioner
and cannot legally sign or file any process in the courts.
A legal practitioner endorsing a document must sign in his personal name and no
tin the name of the firm.
Thus, the Bill of charges (in the case of a firm of partners) must be signed by the
legal practitioner in his personal name and on behalf of the firm.
E.g. E. E. Olowononi
For: Olowononi and Co.

PARTICULARS TO BE CONTAINED IN A BILL OF CHARGES

1. The bill should be headed to reflect the subject matter.
2. The bill should contain all the charges, fees and profession disbursements for
which the lawyer is making a claim.
3. Charges and fees should be particularized
4. Sufficient information to enable the client to obtain advice on tax obligation and
for the taxing OFFICER TO TAX IT.

OYEKANMI V. NEPA
NB: Professional disbursements include payments which are necessarily made by the
solicitor in pursuance of his professional duty e.g. court fees, witness fees, cost of
production of records etc.

SERVICE OF BILL ON CLIENT

The bill of charges must be served either
By personal service i.e. physically and personally handing to the client the bill of
charges.
i. By leaving it at the client’s last known address
ii. By post to the client’s last known address.
SECTION 16(1)(A) LPA

EXPIRATION OF ONE MONTH AFTER DELIVERY

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 After delivery of the bill of charges to the client, THE PERIOD OF ONE
BEGINNING WITH THE DATE OF DELIVERY OF THE BILL must expire before an
action is instituted to recover the charges.
One mnoth here is one full calendar month.
A calendar month is a complete month in the calendar.
A calendar month ends upon the same day in the next ensuring month having
the same number as that on which the computation …began (i.e. the corresponding
day in the next month). E.g. 6th March to expire on 6th April.
But if the next ensuring month ahs not the same number as that on which
the computation began, then the calendar month ends on the last day of the next
ensuring month.
E.g.
EXCEPTION
The court may abridge the period of one month within which a solicitor is expected to
wait after service of the bill before commencing action – Section 16(3).
1. Where there exists circumstances indicating that the client is about to do some
act which would probably prevent or delay the payment to the practitioner of the
charges.

PLACE OF INSTITUTION OF ACTION FOR RECOVERY OF PROFESSIONAL FEES

The place of institution of the action is the state high court. It must be the high court
where the legal practitioners in question usually carried on his practice or resides or
where the client resides or has his principal place of business.
Section 19(1)…
An action for the recovery of professional charges could be commenced by means of a
WRIT OF SUMMONS.
Where the solicitor intends to bring the action under the undefended list procedure, he
should ensure that there is an express agreement by the parties i.e. that the defendant
had agreed to pay the fee charged by the solicitor. ARUWA V. ABDULKADIR

TAXATION OF FEES
Where a client fees that the solicitor charged him exorbitantly he may apply to
the court (High Court) for a review of the fees.

PROCEDURE FOR TAXATION OF PROF. FEES

a. The court would appoint a tax officer to review the charges and make a report
thereafter.
b. At the end of the review, the taxing officer will issue a certificate of taxation
wherein he shall state the charges recommended. Section 18(4)…
TIME LIMIT FOR APPLICATION FOR TAXATION
The client has to make this apply for taxation of the charges WITHIN ONE MONTH of
the delivery of the bill of charge on him. Section 17(1) LPC.

WHEN ARE PARTIES ENTITLED TO APPLY FOR TAXATION

132
After the expiration of the one month, both the client and lawyer are entitled to apply for
taxation of the bill. Section 17(2( LPA, …….

SCALE 1
PART 1
For the For the 2nd & For the 4th & For the remainder
first 3rd N1000 per each without limit per
N1,000 per N100 subsequent N100
N100 N1000 up to N
N N20,000 per
N N100
N
3 vendor’s legal practitioner for deducing
title to lease hold property and perusing
and completing legal documentation As in Part 22-50 11.25 5.00
(including preparation of contract and II thereof
condition of sale if any)

5 Mortgagor’s legal practitioner for 11.25 11.25 3.75 2.50

negotiating loan

7 Mortgagee’s legal practitioner for 22.50 22.60 7.70 5.00

negotiating loan

PART II
Over 900 naira but exceeding N1000 - N225.00
NB: For the full Table, see the schedule to the LPA i.e. pages 68 -74 legal ethics
handbook.

QUESTION
UBA Plc desirous of selling a property at Aso Drive Asokoro Abuja, has engaged your
services as a solicitor for the purpose of deducing title to a leasehold property valued at
N100,000 and for perusing and completing legal documentation thereof.
Using the appropriate table, calculate your remuneration

CALCULATIONS:
Using N0. 3 of scale I

Step 1: For the first N1000 per N100

T
= N225.00

133
Step 2: For the 2nd and 3rd N1000 per N100
1000 x 2 = 2000 x 22.50
100 22.50
20
0000
4500
N450.0 0
= N450.00
Step 3: For the 4th and each subsequent N1000 per N20,000 = 20,000 - 3000 =
N17,000
17000 x 11.25 11.25
100 170
0000
7875
1125
1912.50
= 1912.50
Step 4: For the remainder without limit per N100 (the total value of the property minus
amount already calculated i.e. N100,000 - N20,000
80,000 x 5.00 800
100 5
4000
= N4,000.00

Step 5: Add up the answers

4000.00
1912.50
+ 450.00
225.00
6587.50
The fees chargeable for he transaction is N6,587.50k.

QUESTION
Using the same value of N100,000 and acting as solicitor for both the mortgagor
and mortgagee, calculate the remuneration for negotiating the loan.

MORTGAGOR’S SOLICITOR’S FEES

Step 1: For the first N1000 per N100
1000 x 11.25 11.25
100 10
0000
1125
112.50
= N112.50

Step 2: For the 2nd and 3rd N1000 per N100

2000 x 11.25 11.25
100 20
0000
2250

134
 225.00
= N225.00

Step 3: For the 4th and each subsequent allow up to N20,000

20,000 - 3000 = 17,000
17000 x 3.75 375
100 170
000
2625
375
63750
= N637.50
Step 4: For the remainder without limit
N100, 000 - N20,000
80,000 x 2.50 800
100 250
000
4000
1600
2000.00
= N2.000.00
Step 5: Add up

2000.00
225.00
112.50
637.50
2975.00
= N2975.00
Mortgagor’s solicitor’s fees
MORTGAGEE’S SOLICITOR’S FEES
Step 1: For the 1st N1000 per N100
1000 x 22.60 22.60
100 20
0000
4520
452.00
= N452.00

Step 3: For the 4th and each subsequent N1000 up to N20,000 per N100.
20000 - 3000 = 17,000

17000 x 7.70 770

100 170
000

135
 5390
770
1309.00
= N1309.00
Step 4: For the remainder without limit per N100
N100,000 - 20,000
80000 x 5.00 800
100 1 5
4000
= N4,000.00

Step 5: Added up
4000
1309
452
225
N5986.00

Mortgagor’s solicitor’s fees = N5,986.00

Representing both parties, solicitors fee is half of mortgagor’s solicitor’s fees and full
mortgagee’s solicitor’s fees.
Thus:
Mortgagor’s solicitors fees = N2975
2975 = 1487.50
2

Add to mortgagees solicitor fees

1487.50
+ 5986.00
N7473.50

CLASS ACTIVITY
As the solicitor to imperial Bank Plc, you have been briefed to sell its property at No. 4
upper lane Bivari valued at N300,000.00 your brief includes deducing title, perusing and
completing the legal documentation regarding the property.
Calculate your remuneration.

ANSWER
Using No. 3 of PART I in SCALE I
Step 1: For the 1st N1000 per N100
Using consideration in Part II
= N225.00

Step 2: For the 2nd and 3rd N1000 per N100

2000 x 22.50
100 2250
20
0000
4500
450.00
= N450.00

136
Step 3: For the 4th an each subsequent N1000 up to N20,000 per N100
20000 - 3000 = 17,000
17000 x 11.25
100 1125
170
0000
7875
1125
1912.50
= N1912.50

Step 4: For the remainder without limit per N100 value of property minus N20,000
= 300,000 - 20,000 = 280,000
280,000 x 5 2800
100 5
14,000 = N14,000

Step 5: Add up
14000.00
1912.50
+ 450.00
225.00
N16587.50

Thus, the solicitors fees for deducing title, perusing and completing documentation is
= N16587.50k.

See sample of a Bill of Charges below:

JOHN BROWN & CO
BARISSTERS AND SOLICITORS
NO 120 KENT STREET IKOYI
LAGOS STATE
Our Ref:
Date: 30th April, 2012.

To
Mrs. Aduke Thomas
No. 45 Isheri North Scheme
Ikeja
Lagos State.
Dear Madam,
RE: PREPARARTION OF WILL
BILL OF CHARGES
Sequel to your instruction to prepare your last Will, please find attached our Bill of
Charges on the execution of the instruction.
Date Principal items Amount (N)
3 August 2012 Professional fees on 250,000
prepara- tion of Will
4 August 2012 Transportation to Probate 2,000
Registry
5 August 2012 Lodging of Will at Probate 500
Total 252,500.00
Less deposit 100,000.00
Amount due N152,500.00
Yours faithfully,

137
 John Brown, Esq.
(Managing Partner)
For: John Brown & Co
WEEK13-15-WILLS AND CODICILS 1-3
MEANING OF A WILL
It is a testamentary document made by a person called the Testator with a sound
disposing mind on how his estate will be disposed upon his death or it is a directive of a Comment [g69]: HIGHLIGHTS
T-TESTAMENTARY DISPOSITION
person on how his things or his properties will be disposed of upon his death. E-EXECUTED LAWFULLY
V-MADE VOLUNTARILY
BY TESTATOR WITH SOUND DISPOSING MIND
APPLICABLE LAWS ARE: AMBULATORY IN NTURE
1. The Wills act of 1837 and the Wills Amendment Act 1852 all as SOGA
2. The Common Law and Equity Comment [g70]: Received law in Nigeria
Wills Act 1837
3. Wills Law of the various States Wills Amendment Act 1852 (Amendment of
the provisions of 1837 Act).
4. High Court of Lagos State (civil Procedure Rules) 2012,
A will is a creation of statute and must comply
5. High Court of the FCT Abuja (civil Procedure Rules) 2004 and those made by strictly with the relevant statute in order to be
valid. If a will does not dispose of property,
different States then it cannot be accepted as a will.
6. Case Law
The law that regulates Will is the law of the testator’s domicile i.e where the testator
resides with the intention to permanently reside there.
Note the difference between DOMICILE AND RESIDENCE

REASONS FOR THE UNDESIRABILITY IN MAKING A WILL

 IGNORANCE
 Superstition
 Lack of trust

HISTORY OF WILLS IN NIGERIA

PRE-COLONIAL ERA
Before the colonial era, disposition of property took place under customary law or the
inheritance laws.
This was affected mainly through oral disposition. Where a man fails to dispose his
properties orally, upon his death, the properties would devolve according to the
customary law.
In YORUBA land, a dying person can dispose his property under the customary law by
oral disposition in the presence of 4 witnesses.
ISLAMIC LAW: A person subject to Islamic law can only dispose of 1/.3 of his property
through a will. The remaining 2/3 must be disposed in accordance with Islamic rules
stated in the Koran.

COLONIAL ERA
During the colonial era, statutory will was introduced. A statutory will is a will created in
accordance with a particular statute in force.

138
SOME TERMS USED IN WILLS Comment [g71]: NB:
The propounder is the person who puts forth
 The person making the will is called TESTATOR, where the person is a female, the will for validity. It may be the executor or
she is called TESTATRIX. Where a person makes a will, he is said to have died one of the beneficiaries.
The challenger is the person contesting the
TESTATE. validity of the will.
 Where none is made, he is said to have died INTESTATE. The person entitled to
the properties or benefits under the will is called BENEFICIARY and sometimes
SUCCESSOR.
 The total of the personal and real properties of a deceased is referred to as the
ESTATE of the deceased. The estate includes the liabilities of the deceased.
 The personal representatives appointed under the will to administer the estate of
the deceased are called EXECUTORS where the deceased dies INTESTATE,
ADMINISTRATORS are appointed to administer the estate.
 Landed properties are called device while personal properties are called legacies

TYPES OF WILLS
1. Formal will
This is a will made according to prescribed form as required by the relevant wills
laws. It derives from English law and it is required to be signed by the testator and
attested by at least two witnesses.

2. Statutory will
These are wills made in accordance with the requirement of certain statutes.
Examples, wills made according to Armed Forces Act Cap 420 LFN 2004 for members
of the armed services.

3. Nuncupative wills
A nuncupative will is the oral directives of a deceased person to his heirs which
are to be carried out after his death. It is usually made in anticipation of imminent death.
Sometimes referred to as death Bed Wishes.

4. Mutual or reciprocal will

It is made by two or more persons. They are reciprocal … they make provisions
for each of the makers of the will, or … agreement between them to dispose their
properties in … particular way. It is common among husband and wife when each
leaves their property to the other on the condition that the … to die will leave all their
estate to an agreed 3rd party eng. ..
5. Privileged will
This is a will made by certain categories of person’s in actual military service e.g.
a. A soldier in actual military service
b. A mariner or seaman being at sea
c. A crew of commercial airliners
Such persons can make wills without the required formalities. It may not be
written or signed or attested… the testator must however have the TESTAMENTARY
capacity and the intention to make the will.

139
6. Holograph will
This is a will written and executed in the hands of the testator himself which is
usually not attested.
7. Prenuptial will
This is a will made preparatory to a marriage

8. Conditional will
This is a will executed based on certain pre-conditions which must be fulfilled
before the will can take effect.

RELATED TRANSACTIONS
The following transactions are concerned with the disposition of properties but
are not wills.
a. Nominations
This is a directive made by a person (the nominator) to an organization, or
institution or any other person, that upon his death his funds in the organization should
be paid to a particular individual (the nominee).
Nominations can be made only in respect of funds of the nominator and not in
respect of other properties.

b. Settlement inter vivos

This occurs where a settler transfers his property in his lifetime to another living
person to hold and take effect in his lifetime. It differs from a will because a will takes
effect after the death of the maker of the will.
c. Donatio mortis causa
This is a disposition of property made by a person in contemplation with, but
which takes effect only when the donor does.
Where the donor recovers from the anticipated death, the gift does not take
effect.

FEATURES / CHARACTERISTICS OF A FORMAL WILL

1. It must be written
2. It is testamentary, i.e. it comes into effect only upon the death of the testator.
3. It is ambulatory , i.e. it can be revoked during the testator’s lifetime
4. It must be voluntarily made
5. It must be duly executed in accordance with section 9 of the Wills Act
6. It must be made with a sound disposing mind and at testamentary age

ADVANTAGES OF MAKING A WILL

1. Excludes or limits the application of customary rules of inheritance.
2. The testator gives directives as to the disposition of his property
3. He gives additional directives as to his burial

140
4. The making of a Will removes the application of customary law rules of succession/
intestacy upon the disposition of his estate
5. Upon the testator’s death, the authority of the executors to administer the Will arises
directly from the Will. Probate is only granted as a confirmation of their authority
6. The cost is cheaper in obtaining Probate than it is with obtaining Letters of
Administration if a person died intestate (without making a Will)
7. The continuity of administration of the testator’s estate is guaranteed
8. Assist in appointing guardian(s) for his infant children
9. It can be used to make a trust in form of donations to Institutions/ Charity Homes
10. It can serve as documentary evidence

DISADVANTAGES OF MAKING A WILL

1. It does not enhance community and affinity in the families of the deceased
2. Additional costs and expenses incurred on its drafting
3. Any mistake on the formal requirements of a will may easily vitiate it.

CAPACITY TO MAKE A WILL

These are the elementary criteria to be possessed by an individual before he is
qualified in Law to make a valid Will.
The testator must possess the TESTAMENTARY CAPACITY to make a will vi z:
a. age
b. mental capacity

AGE
Only Adults from 18 years in Lagos State /21 years of age in States under the Wills Comment [g72]: an illiterate has the
capacity to make a Will/attest to a will, but a
Act can make Wills. jurat must be inserted.
Section 7 Will Act - 21 years Also a blind person can make his Will but a
blind jurat have to be included.
Section 3 Wills Law Lagos - 18 years
Where an under-aged makes a will, the fact that he later or subsequently
attained the age of adulthood does not validate the will.
The EXCEPTION to the above rule is a privileged Will allowed to be made by
members of the Military who are below the age limit of adulthood as follows;
1. Soldiers in actual military service
2. Mariners at sea
3. Crew of commercial airlines in the Air
SECTION 11 WILLS ACT
SECTION 6 WILLS LAW LAGOS
MENTAL CAPACITY
A testator must have the mental capacity or sound disposing mind to make a Will
This must be present
 BOTH at the time of giving instructions for his Will to be prepared AND
 at the time of its execution. See OKELOLA V. BOYLE.

141
TESTS
The tests for determining if the testator had mental capacity/sound disposing mind when
making his Will was lay down in the case of BANKS V. GOODFELLOW (COCKBURN
J) as follows:
a. Understand the nature of the act of will making and its legal implication
b. Whether he knew the nature of the property and the extent of the gifts made?
c. Whether he has a good knowledge of the beneficiaries
d. The Will must be rational
NB = Soundness of mind should not be confused with the state of body health
JOHSON V MAJA
ADEBAJO V. ADEBAJO
OKELOLA V. BOYLE

PROOF OF SOUND DISPOSING MIND

To prove the mental capacity of a testator, reliance may be placed on either or both of
a. Presumption of a sound disposing mind
b. Positive affirmative evidence of a sound mind.

PRESUMPTION OF SOUND DISPOSING MIND

 It is presumed that a testator was sane at the time he made his Will. The
presumption of sound mind is based on the view that where a will appears ex-
facie rational and logical, it will be presumed to be so.
Thus, where NO SUSPICION attaches to a will, the courts will presume the
 Comment [g73]: . Thus omnia
praesumantur rite esse acTa (everything is
document as alright unless other evidence displaces this presumption. presumed to be okay which okay)
OKELOLA V. BOYLE
 In the case of BANKS V. GOODFELLOW, the presumption was rebutted as it
was proved that the testator made the Will and went about his normal activities
even though he was suffering from fits of unsound mind.

EXCEPTION (WHERE MAXIM WILL NOT APPLY)

1. Where there is suspicion or the will is not exfacie regular or
2. where the testator suffers from some disability such as deafness, blindness or
illiteracy, the maxim will not apply.

ONUS OF PROOF OF MENTAL CAPACITY

 If the state of mind of the testator is contested, the onus is on the
PROPOUNDER of the will to establish that the will is duly executed usually by
showing that the rational on its face or
 he may decide to advance positive affirmative evidence in support of the testator
is state of mind
 After this, the onus shifts to the CHALLENGER will must adduce evidence to
show that despite the fact that THE will is rational on its face and duly
executed, the testator was insane at the time the will was made.

142
 JOHNSON V MAJA

NOTE THAT EXTREME OLD AGE DOES NOT IMPUTE LACK OF MENTAL
CAPACITY.
TESTAMENTARY INTENTION
To make a valid will, a testator must possess
ANIMUS TESTANDI(intention to make a will ), know and approve of thecontent
Testamentary intention not dislodged by old age.-BALONWU V. NEZIANYI
NOTE CAREFULLY;
 The Will of a person who is sane at the time of giving the instructions for the
preparation of the Will but insane at the time of signing it may be valid or invalid
depending on the facts of each case.
 If the instruction was personally given to the Solicitor, the Will will be held to be
valid. PARKER V. FELGATE.
 Conversely, if the instruction was given through a third party /lay agency to be
further communicated to a solicitor it will be held to be invalid.
SINGH v. ARMICHAND.

PRECAUTIONARY MEASURES TO BE TAKEN BY A SOLICITOR IN RESPECT TO

MENTAL CAPACITY
1. Have a confirmatory statement signed by the Solicitor that the testator
had mental capacity to make a Will. RE WALKER
2. Get a medical report by a medical practitioner who examined the
testator confirming the presence of mental capacity of the testator
BLIND PERSONS CAPACITY
A blind person can make a Will based on the following-INSITFUL V. CHRISTIAN
CONDITIONS
1. it must be shown that the Will was read over to him and
2. he perfectly appeared to understand the contents before affixing his
hands to it.
3. A special attestation clause must be inserted to the Will as evidence of
having read the Will to him. It is called BLIND PERSON’S JURAT.
CAN A BLIND PERSON ATTEST TO A WILL
A blind person cannot attest to a Will because his disability make it impossible for him to
see the signature of the testator and the act of signing the document.
VALIDITY OF A WILL
The factors that must exist to make a Will valid in Law as follows:
1. Testamentary capacity of the testator to dispose of his estate
2. The will was made voluntarily without any element of undue influence
3. It must be made in writing
4. It must be duly executed in accordance with section 9 of the Wills Act.

REQUIREMENTS FOR A VALID WILL (explained)

143
 1. WRITING
 No particular form of writing is necessary.
 It may be typed printed, handwritten (holograph) or a combination of these
 The language must not only be English. –
WHITING V. TURNER the court held as valid a will written in French language
S. 9 WILLS ACT 1837,
S. 4. WILLS LAW LAGOS
2. SIGNED BY THE TESTATOR
 A signature may be an initial, a cross, rubber stamp,
 The signature must be what the testator intended and it must be complete.
 Signature does not include sealing. ELLIS V. SMITH
However, IN THE GOODS OF EMERSON SEALING coupled with INITIALS
on the seal was held as signing.
 A thumb impression was accepted as signature IN THE ESTATE OF
RANDLE (NELSON V. AKOFIRANMI)
 Where the testator is illiterate or blind, a jurat should be inserted indicating
that the contents of the will were first read and interpreted to him and he,
understood before affixing signature.

THE THREE (3) MODES OF EXECUTING A WILL ARE AS FOLLOWS:

a. Execution is done by the TESTATOR in the presence of at least 2 witnesses
who must in his presence also attest to the Will
b. Execution by a representative duly authorized by the testator SIGNING it in the
PRESENCE of the testator and at least 2 other witnesses
c. By the TESTATOR himself PRE-SIGNING it and then ACKNOWLEDGING his
signature in the presence of at least 2 witnesses

S. 9 OF THE WILLS ACT

THE POSITION OF A TESTATOR’S SIGNATURE IN A WILL
 Formerly in the Wills Act of 1837, the signature of the testator must be at the
bottom of the Will.
 However, the Wills Act as amended in 1852 provided that it does not matter
where the signature is provided it is signed.
 In ALL cases, the testator must sign BEFORE the witnesses sign.
In order to avoid fraud, any disposition or direction which IS UNDERNEATH
OR FOLLOWS THE TESTATOR’S SIGNATURE IS VOID AND INVALID
S. 1 OF THE WILLS ACT
S. 4 OF THE WILLS LAW.

3. ATTESTATION BY THE WITNESSES

 The signature of the testator MUST BE MADE OR ACKNOWLEDGED BY HIM
in the presence of AT LEAST two witnesses who must BE PRESENT AT THE
SAME TIME.

144
  Words are not necessary for attestation- IZE-IYAMU V. ALONGE
 The witnesses must be present at the same time though they may not be
present when EACH of them is signing -CHODWICK V PALMER
 The presence of witnesses here is physical and simultaneous when the
testator signs or acknowledges his signature
A witness must sign IN HIS OWN HAND and cannot DIRECT ANOTHER TO
SIGN ON HIS BEHALF as a witness.
BENEFICIARIES AND THEIR SPOUSES ATTESTING A WILL
 The general rule is that a beneficiary to a Will and his/her spouse cannot
take the gift made to them under a Will if either of them is a witness to the Will.
 Any gift made to such person will be utterly NULL AND VOID
 A benefiting witness/spouse is only DISQUALIFIED from taking the gift made
under the Will, BUT is a competent witness to testify on the facts of due
execution of the Will
S. 15 OF THE WILLS ACT
S. 8 OF THE WILLS LAW OF LAGOS.

EXCEPTIONS TO THE ABOVE RULE ARE:

o Where a witness had SIGNED the Will before MARRYING a beneficiary under the
Will
o There are more than 2 witnesses who attested to the Will and one of them
benefited from the Will
o The gift was made in settlement of a debt
o The gift was subsequently confirmed in another Will or codicil which is not attested
to by the beneficiary.
o The rule does not apply to privilege wills
o The witness is subsequently appointed a Solicitor to the Will which contained a
charging clause
o Where the person present merely signs that he agrees with the contents of the Will
but not as witness
o Where the person present merely signs that he agrees with the contents of the Will
but not as witness

THE FACTORS WHICH MAY VITIATE THE VALIDITY OF A WILL INCLUDE

a. DELUSION
b. UNDUE INFLUENCE
c. FRAUD
d. MISTAKE
e. SUSPICIOUS CIRCUMSTANCES

DELUSION

145
 Delusion is a belief which no rational person could hold but which reasoning with the Comment [g74]: Religious Delusion: Eg
where a certain woman had the belief that
testator cannot eradicate from his mind and which is capable of influencing the she was of the Trinity, was a Bride of God, Dr-
provision of his will. Smith (the beneficiary) was God the father,
her husband was a devil.
 Person suffering from delusions can create a valid will where the testator satisfies
the test in BANKS V. GOODFELLOW
 Delusion must influence disposition to render the will invalid-
BATTAN SINGH V. ARMAND ;
AMU V. AMU
 There must be a nexus between the delusion and the disposition of the will.
 Where a testator gives instructions with sound disposing mind directly to a
SOLICITOR OR NOTARY PUBLIC but BEFORE execution looses mental capacity.
the will is still valid if executed with knowledge –
PARKER V. FELGATE
PERERA V.PERERA
EXCEPTION- this rule above will not apply where the instructions were given to
an intermediary by the testator.BATTAN SINGH V. ARMICHSAND

 Where the testator had LUCID MOMENTS within which he make the will, the will
would be valid. BANKS V GOODFELLOW
 Thus, insane delusion in question of facts surrounding a case

UNDUE INFLUENCE
 Undue influence is coercion to make a will in a particular way. HALL V. HALL
 It occurs where the testator’s mind has been subject to any improper persuasion
or machination in such a way he is overpowered and consequently induced to do
or forbear.
 an undue influence must be proven not presumed.
NB= Undue Influence should be differentiated from persuasion.
Persuasion /family considerations are not regarded as undue elements e.g. a Solicitor
advising the testator to consider giving some legacies to one of his sons he has refused
to give anything in the Will. JOHNSON V. MAJA
Persuasions appeals to the affections is ties of kindred sentiment of gratitude for past
services or pity
- HALL V. HALL,
Where a man deprives his wife of benefits and gives generously to his mistress:
-
this may not alone prove undue influence – JOHNSON V. MAJA
FRAUD
Where successfully proved would invalidate a will in all its entirety
MISTAKE OF LAW
May not be fatal to the validity of a will but a MISTAKE OF FACTS will be fatal to the
will
eg where testator mistook Ngozi for Nkiru in devolving his property to her.

146
SUSPICIOUS CIRCUMSTANCES
Suspicious circumstances like a situation where a gift was substantially made to a
person who is in a fiduciary relationship with the testator e.g. a Lawyer, Pastor, doctor
etc.
there is a presumption that the testator was unduly influenced in making the gifts so the
PROPOUNDERS will have the burden to prove that there was no undue influence. RE
A SOLICITOR

ALTERATION OF A WILL
Any alteration in a Will AFTER ITS DUE EXECUTION will only be VALID if AFTER the
alteration the Will is EXECUTED by the TESTATOR in the JOINT PRESENCE of AT
LEAST 2 WITNESSES who will also attest to it in accordance with section 9 of the
Will Act.

PROOF OF VALIDITY OF A WILL

A WILL MAY BE PROVED IN ITS COMMON FORM OR SOLEMN FORM
The onus of proving the existence and validity of a Will is on the PROPOUNDERS
usually the Executors- of the Will.

THEY CAN DO SO BY ANY OF THE FOLLOWING MEANS:

AFFIDAVIT
This is used when
a. There is no proper attestation clause
b. The judge has any doubt as it to the due execution of a will
c. Where the testator is an illiterate or blind person.
The affidavit will set out the manner in which the will was read or interpreted to the
testator and the manner in which he signified that he understood and approved of its
content.
RE GEALE- DEAF/DUMB/ILLITERATE TESTATOR
OR.58 R 5 &10 HCCPR

PRESUMPTION OF DUE EXECUTION

The Latin term is omnia prae sumuntur rite esse acta meaning everything that that
seems regular are deemed properly done.
CONDITIONS
1. The Will must be regular on its face.
2. It must have a proper attestation clause
NELSON V. AKOFIRANMI
However this presumption is rebuttable with cogent evidence.-BANKS V. GOOD
FELLOW
Any doubt in respect to a Will is resolved in favour of the Will.

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S.168(1) ea 2011
POSITIVE AFFIRMATIVE EVIDENCE
In addition or as alternative to the presumption of sound mind the PROPOUNDER may
lead positive affirmative evidence to prove that the testator had a sound disposing mind.
This evidence may be documentary and oral.

EXAMPLE OF SUCH EVIDENCE INCLUDE.

a. Statements made at the time of instruction and execution
b. Evidence that the will was written by the testator or the instructions were written
by him
c. Evidence of attesting Witnesses, which should be corroborated ADEBAJO V.
ADEBAJO
d. Medical evidence by credible doctors who must have examined the testator in
the past- OKELOLA V. BOYLE
e. Evidence of the conduct of the testator BEFORE and AFTER making the will-
MAJA V. JOHNSON
f. Evidence of general habits and course of life of the testator before making of the
will - ADEBAJO V. ADEBAJO ;BANKS V. GOODFELLOWS

ETHICAL ISSUES
1. Counsel to represent client within the bounds of the law He should not
contravene the law R. 15
A lawyer should not collude with a Beneficiary to alter order the Will.
2. Duty not to take undue benefit from a client’s property R-23
Where a lawyer is a beneficiary under a Will, he should at the testator to engage
the services of another lawyer to do the Will.
3. Duty not to charge exorbitant fees R. 48 RPC
4. Duty to take instructions in writing
5. Duty to be devoted and not to be negligent R. 14
6. Duty of confidentiality R. 19
7. Duty to disclose any conflict of interest R. 17
8. Duty not to take instruction in client’s house exception special circumstances R.
22
9. Advise client on who can be his Executor
10. Ensure that all the beneficiaries are catered for
11. Advise client on the fact that a beneficiary should not have a witness or
Executor

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 WEEK 14- WILLS AND CODICILS 2
TYPES OF GIFTS
1. DEVICES: these are realty or landed properties(IMMOVEABLE) of the testator
The BENEFICIARY of such immovable is referred to as a ‘devisee”
2. LEGACY/ BEQUESTS: these refer to the personal properties of a
testator e.g chattels, choses in action, money etc
The BENEFICIARY of such gift is referred to as a ‘LEGATEE’
However, legacy is now used to refer to both movable and immovable gifts.

CLASSES OF GIFTS UNDER A WILL

c. Specific gift which is subject to the rule of ademption (a situation where the specific
gift bequeathed to a beneficiary is discovered not to be in existence and the gift will
fail because of that)
a. General gift
b. Demonstrative gift
c. Substitutive gift
d. Annuity
e. Pecuniary gift
f. Residuary gift which is aimed at avoiding partial intestacy
g. Joint gifts or those given in common or equal shares

TYPES OF LEGACY
1. SPECIFIC LEGACY
This is a gift of an identifiable property that is specific and distinguishable from the other
properties owned by the testator.
Must be properly and sufficiently dscribed
The gift may be indicated by the use of the word “my” followed by a description of the
gift.

EXAMPLES:
A gift of my Toyota camry car with Reg. No BQ232 AWk to my daughter Bimpe.
I give my diamond ring bought from Agoz Jewelries UK to my niece Nkechi
A gift of my 4 million shares in FBN PLC to my son Bala
It is not a specific gift if it reads; “A Toyota car for my son dayo”

ADVANTAGES
 It is not liable to abate where there is insufficient funds or the estate is not Comment [g75]: Abatement means
reduction in xter, quality or dimunition xfer
enough to satisfy all legacies, obligations debts.
 Income from it accrues and starts running from the time of death of the testator
DISADVANTAGES
If the gift is no longer exists or cannot be found at the time of the testator death, it

would be said that the gift is adeemed and therefore it has failed.
METHOD LP WILL USE TO CIRCUMVENT

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In order to avoid the failure of a specific gift, ALTERNATIVE OR SUBSTITUTED GIFTS
are made to the bereg a gift of my Mercedes Benz with Reg. No. ….. if it fails, I make a
gift of Toyota Hiace with Reg. to my son
2. GENERAL LEGACY
There is no specific description.
It does not refer particular piece of the testator’s estate.
The testator intends that the gift should be satisfied from the general assets of his
estate.
There is nothing distinctive about the gift.
EXAMPLES.
A gift of a walking stick to my son Joel. Comment [g76]: Note GIFTS OF SHARES
AND STOCKS.
If the testator does not own a walking stick at his death. Executors will provide for it
form the testator’s general estate.
ADVANTAGES
 It is not liable to ademption

DIASADVANTAGES
 Suffers abatement where estate is insufficient
3. DEMONSTRATIVE LEGACY
This may be in form of general legacy but directed to be satisfied from a specific fund
or particular pool of property.(not restricted to ppty)
MARKER-USUALLY PAYABLE FROM A BANK ACCOUNT

EXAMPLE
I give 50,000 naira to Bimped to be drawn from my savings account No. 2345678910 at
Diamond Bank Akay
= Gift + Description + Source = Demonstrative legacy. Demonstrative gift is not subject
to ademption and will only abate where the particular fund is not sufficient to take care
of the legacy

Examples
A gift of 2 million naira to be paid out of my a/c with Zenith Bank plc Okpara Avenue
Enugu Branch to Johnson.
A gift of my Honda car with Reg. No….. parked in my garage at No. 5 Park Lane
Independence Layout Enugu

DEMONSTRATIVE LEGACY IS NOT LIMITED TO A GIFT OF MONEY E.G

A gift of my books kept in the shelf in my bedroom.
A gift of my articles published by Adams & Kings Publishing Company Asaba
NOTE-THE COURT WILL TREAT IT AS GENERAL LEGACY WHEN IT FAILS AAS
SPECIFIC LEGACY

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WHEN CONVERTED TO GENERAL LEGACY, IT IS LIABLE TO ABATEMENT (A
PARTICULAR PROPRTION)

4. PECUNIARY LEGACY(ANNUITY)
 This is strictly money dispositions.
 Called an ANNUITY when it is expressed to be paid at intervals
 It could be general, specific or demonstrative
 It may or may not give direction of the particular fund where the money should be
drawn from, if it gives direction on the particular fund, it is demonstrative legacy.
Eg
I give 50,000 naira to my wife Nkechi to be paid to her every month.
MONEY INCLUDES
 cash and notes at hand,
 money immediately payable to the testator at call and
 money at the Bank RE WHITE
However, money cannot be EXTENDED to include shares in company.

5. RESIDUARY LEGACY
 This is the remainder of the property belonging to them after payment of all other
gifts and debts,expenses taxes and liability of the testator have been fulfilled,
cleared or paid
 It is made up of personal or real property.
 A residuary clause is usually inserted in the Will to transfer all remaining residue
and remainder
 Such remainder may have been derived from the following so
a. Property acquired by testator after making his will or codicil
b. Properties acquired after testator’s death.
c. Gifts that lapsed by the death of the beneficiary or lack of substitution clause
d. Gifts that failed.
The beneficiaries are called ‘Residuary LEGATEES’
Effect of not including the clause-LEADS TO PARTIAL INTESTACY
S.53 AEL LAGOS.

RESIDUARY LEGACY LESSENS THE POSSIBILITY OF PARTIAL INTESTACY.

6. ABSOLUTE LEGACY
No conditions attached.
It vests automatically and takes effect upon the death of the testator

7. CONDITIONAL LEGACY
The gift only becomes effective upon the happening of particular event.

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FAILURE OF GIFTS
THESE ARE SITUATIONS WHERE THE LEGACIES/BEQUESTS WILL NOT BE
AVAILABLE TO THE BENEFICIARY UNDER A WILL FOR SOME REASONS AS
FOLLOWS:
1. Where a witness not falling under the exceptions is a beneficiary OR SPOUSE
under the Will, S. 8 of the Wills Law and S. 15 of the Wills Act
2. The SPECIFIC gift is caught by ADEMPTION where the gift is no longer in
existence or that its nature/ character have changed before the testator’s death. In
such a case the beneficiary will have nothing
3. LAPSE OF GIFT-The gift lapses where the beneficiary PREDECEASE the testator. Comment [g77]: ILLUSTRATION
Chief Ojo made a gift of his house at No. 3
4. Based on PUBLIC POLICY the gift will fail like when the beneficiary is PROVED to rd
Keja Road Lagos to Eunice his 3 wife. Eunice
have KILLED the testator –ERRIGNTON V. ERRINGTON OR to incite divorce or for dies of hay fever while Chief Ojo lives. The
devise to Eunice will be said to have lapsed
an immoral purpose. and would devolve to the estate of Chief Ojo.
5. The gift was made to promote an ILLEGAL purpose But if both Ojo and Eunice both die in an
6. UNCERTAINTY of the object/benefit, the gift will fail accident together, the gift to Eunice does not
lapse because it is presumed that Chief Ojo
7. The estate of the testator ABATED when it is insufficient to give any gift charged on being older died foist = an older person is
deemed to have died before a younger person
it in a Will where the time of their deaths is confusing.
Thus, the gift would devolve upon Eunice’s
8. DISCLAIMER by beneficiary. The beneficiary to disclaim a gift will write the
successor. Lapse cannot be excluded in a Will.
executors rejecting a gift.
9. CONDITIONAL gift made subject to fulfilling some UNSATISFIED conditions
Comment [g78]:
10. Gift to testator’s spouse due to DIVORCE/ANNULMENT OF MARRIAGE-s.18A
Comment [g79R78]: WHEN IT NOT
wills act PROPERLY IDENTIFIED

11. Gift is contrary to INALIENABLITY RULE- LAWAL OSULA V. LAWAL OSULA

12. Gifts contrary to the NEMO DAT NON QUOD HABET rule- WHERE TESTATOR
HAS INVALID TITLE.

13. The presence of vitiating elements in the making of the gift/ Will (fraud/ duress,etc

THE CIRCUMSTANCES WHERE ADEMPTION WILL OCCUR:

 The gift is sold before the testator’s death
 The property as the gift is subject to a Formal Contract of Sale
 The property given as a gift was compulsorily acquired by the State
 A fundamental change occurred in the character of the gift
 The property as gift is subject to a hire-purchase option.
 ADEMPTION BY OPERATION OF LAW
 By a subsequent disposition by the testator of the subject
 By presumption against double portions
 Where the property is lost.

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 THE EXCEPTIONS WHERE GIFTS WILL NOT FAIL BASED ON THE RULE OF
ADEMPTION ARE:
a. it is a general gift
b. A change in the gift is only in respect of the form, e.g. shares in a Bank A bought by
another Bank , the shareholders of A will still be shareholder in the later Bank

PRESUMPTIONS SURING LAPSE OF GIFT

SECTION 164 (2) EVIDENCE ACT 2011
For the purpose of determining title to property
 where two or more persons have died in circumstances in which it is uncertain
which survived the other, they are PRESUMED TO HAVE DIED IN ORDER OF
SENIORITY.
 If the beneficiary however is OLDER than the testator and they die at the same
time, it is presumed that the beneficiary died first, thus the gift will fall.
Where ALL of them died at the same time, it is presumed that the YOUNGEST
of them died LAST and the gift DEVOLVES to his SUCCESSOR –in- title.

EXCEPTIONS WHERE A GIFT WILL NOT FAIL BECAUSE THE BENEFICIARY DIES
(LAPSE) BEFORE THE TESTATOR ARE:
a. A class gift(s) made to more than one person JOINTLY or in EQUAL shares. The Comment [g80]:
other survivor will take the gift.
Comment [g81]: NB =
b. Gifts to settle debt or moral obligations would not be affected by the doctrine of
lapse whether or not the obligation legally binding. Even after the DEATH of the
beneficiary, the gift will be paid to the estate of the deceased beneficiary.
c. Where there is a substitution or alternative gifts (substituted beneficiary)
d. A gift.to a testator’s child who dies in the life time of the testator but has a child
who is living after the death of th testator
.S. 33 WILLS ACT,
S. 24 WILLS LAW
e. The beneficiary had surviving heirs,
S. 24 OF THE WILLS LAW
S. 23 OF THE WILLS ACT

REVOCATION OF WILLS
These are situations where a valid Will made will be revoked or made invalid either by
the acts of the testator or by implication of the Law as follows:

VOLUNTARY REVOCATION
1. By the testator making a subsequent Will or Codicil duly executed
2. By a written declaration with the intention to revoke the will
3. By destruction of a Will with the requisite intention to make it invalid

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INVOLUNTARY REVOCATION- REVOCATION BY OPERATION OF LAW
By the testator engaging in a subsequent statutory marriage (under the Act) Comment [g82]: Involuntary revocation
Nb- the other three forms are voluntary

THE ABOVE MEANS OF REVOKING VALID WILLS WILL BE TREATED BELOW;

A- VOLUNTARY REVOCATION
SUBSEQUENT WILL OR CODICIL
By the testator making a subsequent Will or Codicil duly EXECUTED stating that he
REVOKES the earlier Will
FORMS
This he may do by either:
EXPRESS REVOCATION:
The subsequent Will/Codicil contains a revocation clause revoking the earlier Will
EXCEPTIONS
A. Clause was inserted by mistake and without testators approval
B. Two wills relate to different property of the testator-
O’LEARY V. DOUGLAS

NOTE-GENERAL WORDS SUVH AS “LAST AND ONLY WILL”/ LST TESTAMENT

OF ME may not be sufficient to revoke an earlier will.
IMPLIED REVOCATION:
This is where the latter Will is in contrast with the provisions of the earlier Will, thus the
latter Will’s provisions will prevail.

FORMS OF IMPLIED REVOCATION

1. If it covers practically the same grounds as earlier one
2. Where the latter will disposed the same properties to either different beneficiaries
or in a manner inconsistent with the former will-HENFREY V. HENFREY

HOWEVER IT IS NOT A GENERAL RULE THAT EVERY INCONSISTENT WILL

REVOKES THE PREVIOUS ONE-BIDDLES V. BIDDLES.
WRITTEN DECLARATION WITH THE INTENTION TO REVOKE THE WILL
TYPES OF WRITTEN DECLARATIONS
A. Memorandum of revocation
B. A letter
C. A settlement
D. An ordinary declaration of intention to revoke a will
The written declaration MUST BE DULY EXECUTED for it to be valid.
S. 9 OF THE WILLS ACT ;
S.1 WILLS (AMENDMENT ACT)1952;
S.4 WILLS LAW LAGOS
PARKER V. PARKER
HENFREY V. HENFREY

154
 DESTRUCTION OF A WILL WITH THE REQUISITE INTENTION TO MAKE IT
INVALID.
Under this, there are TWO ways /MODES of destroying the Will:
1. Personally by the testator with an intention to destroy same; or
2. By giving instructions to a third party to destroy the Will
For this MODE of DESTRUCTION to be VALID, the following conditions must exist:
a. The instruction to destroy the Will must be in writing
b. The testator must be present when it is been destroyed.
c. It must be at his request or direction

S. 20 OF THE WILLS ACT

S. 13 OF THE WILLS LAW

EFFECT OF NON COMPLIANCE- INVALID REVOCATION-

RE DADDS
IN THE GOODS OF BACON- it was held that the destruction of a will by a third party
AFTER the testaors death on the instructions of the testator in his lifetime was and
INEFFECTUAL REVOCATION-exams

.CONDITIONS FOR REVOCATION BY DESTRUCTION

 There must be a sufficient act of destruction
 There must be an intention to revoke by the act of destruction

The ACTAND THE INTENTION MUST BE CONTEMPORANEOUS (done at the same

time)
There can be no subsequent ratification or confirmation of the act which was done
without intention-
GILL V. GILL

SUFFICIENT ACT OF DESTRUCTION

The destruction must be physical and sufficient
SUFFICIENT ACTS OF DESTRUCTION
 completely tearing (BEYOND RECOGNITION)
 Cutting /mutilation
 burning completely
 scribbling out the signature of the testator or witnesses

NB = SUFFICIENT destruction of the ORIGINAL COPY of a Will is also sufficient

REVOCATION of the copies of that Will

INSUFFICIENT ACTS OF DESTRUCTION

EXAMPLES
a. Merely squeezing the will

155
 b. Drawing lines across the will
c. Tearing some parts of the will
In CHEESE V. LOVEJOY, the testator drew a line according to the Will and wrote the
words “revoked” then squeezed it and threw it a waste bin. His maid picked it up,
straight it and placed on the table where it remained until his death.
HELD: There was NO DESTRUCTION OF THE WILL-WILL NOT REVOKED
STEPHEN V. TAPIRELL

In PERKES V PERKES; the testator tore the Will four pieces with intention to destroy it;
He was stopped by bystanders and the beneficiary who was not pleased with him. He
picked the four pieces and gummed them together saying “It is a good job, it is no
worse”
HELD: The TEARING was not sufficient

PARTIAL DESTRUCTION
 It would only revoke the part torn off not the entire will
IN THE GOODS OF WOODWARD
 Where an essential part is destroyed OR
 Where the destruction renders the remaining part meaningless
THE ENTIRE WILL IS DEEMED REVOKED

INTENTION TO DESTROY
 The act of revocation must have been carried out with the intention to revoke
otherwise the revocation will be invalid(ANIMUS REVOCANDI)
 Such intention must be complete-PERKES V.PERKES

CIRCUMSTANCES WHERE INTENTION TO REVOKE WILL NOT BE INFERRED

 Drunkenness
 Insanity
 Accidental destruction/mistake
 Obliteration of signature without clear evidence of who and why it was done

CONDITIONAL REVOCATION
Occurs where the conditions underwhich the will was destroyed and thereby revoked
have not and could not have been satisfied.
In such cases destruction would be INEFFECTUAL to revoke a will.

INSTANCES OF CONDITIONAL REVOCATION

 a purported revocation due to a mistakes of fact-EG WHERE THE TESTATOR
THOUGHT HIS EARLIER WILLL WAS LOST OR THAT THE LEGATEES WERE
DEAD.
 A purported revocation due to a mistake of law-eg

156
A. -WHERE THE TESTATOR REVOKES HIS WILL BELIEVING THAT HIS
BENEFICIARY WILLL BE THE SOLE PERSON TO BENEFIT ON INTESTACY
B. THE DESTRUCTION OF A WILL WILL REVIVE AN EARLIER WILL
C. AS A PRELIMIINARY TO MAKING A FRESH WILL
THE COURT WILL HOLD THAT REVOCATION IS INCOMPLETE UNTIL NEW
DISPOSITION IS IN PLACE.

B.INVOLUNTARY REVOCATION

THE TESTATOR ENGAGING IN A SUBSEQUENT MARRIAGE UNDER THE ACT

This is a situation where the testator is earlier married under Customary Law with
woman A and has made a Will but later goes ahead to get married under the Act to
woman B. the earlier Will made will become invalid by Law so that he can make a new
Will providing for woman B married under the Act.

NOTE THAT it is only a VALID MARRIAGE under the Act that is capable of revoking Comment [g83]: (see S. 33 of the Marriage
Act for the elements of a valid marriage under
the earlier Will. the Act)
Refer to WEEK 19 CIVIL

A voidable marriage is still a valid marriage UNTIL VOIDED and it can also revoke a
Will. Comment [g84]: (see S. 5 of the
Matrimonial Causes Act for the grounds of
voiding a valid marriage under the Marriage
EXCEPTIONS TO THE ABOVE RULE ARE AS FOLLOWS: Act)

1. A Will was made in contemplation of marriage and the real marriage took place
with the same person contemplated in the Will
SCALLIS V. JONES
S. 177(1) ENGLISH LAW OF PROPERT ACT 1925
S.47 MARRIAGE ACT Comment [g85]: YOU MU8ST STATE THE
NAMES OF THE PARTIES
S.11 WILLS LAW(LAGOS) ;OYO;ABIA
S.79 SUCCESSION LAW OF ANAMBRA STATE
CONDITIONS-
2. Will must be expresses to be made in contemplatoion of a particular
marriage
3. The testator must have married person expressed in the will
4. The names of the parties to the contemplated marriage must be clearly
stated in the will-
CF-RE LANGSTON
5. The testator was married under CUSTOMARY LAW and later got married under
the Act with the same person.
In that case the earlier Will is not revoked by the marriage under the Act. JADESIMI V.
OKOTIE-EBOH
S.11 LAGOS WILLS LAW
S.15(LAWS OF THE WESTERN REGION)
6. Void marriages cannot revoke a valid Will

157
7. A Will made in exercise of appointment not being the personal Will of the testator
cannot be voided by his subsequent marriage UNLESS the persons to take in
default of appointment take as the testator’s heir executor or administrator

8. A subsequent marriage UNDER NATIVE LAW AND CUSTOM does not revoke an
earlier Will.

REPUBLICATION OF A WILL
This is the means of reviving a valid Will in order to give it a new date (when it is
republished).
DATE OF REPUBLICATION IS THE EFFECTIVE DATE

REVIVAL OF A WILL
This is to bring into existence a revoked Will.
This may be done by either a Will or Codicil.
This is the act of bringing back to life or operation a revoke Will or codicil so long as it is
not destroyed.
DATE OF REVIVAL IS EFFECTIVE DATE

MODES OF REVIVAL
This may be done through:
a. Re-execution with the formalities duly complied with,
b. A duly executed codicil with the intention to revive the revoke Will.

CONDITIONS
There must have been a Will which was revoked, if there is nothing revoked, there can
be no revival.
S.22 WILLS ACT
S.15ILLS LAW LAGOS

REPUBLICATION of a Will is the confirmation or reaffirmation of the validity and

contents of a Will
Republication confirms a will which has been lying dormant and is unrevoked.
Republication changes THE DATE THE WILL TAKES EFFECT WHICH WILL BE THE
DATE OF REPUBLICATION NOT THE DATE ON THE ORIGINAL WILL.

CODICILS
This is otherwise known as a miniature or supplemental Will attached to a previous valid
Will.
For there to be a codicil, there must be an earlier Will.
Note that all the formalities for a Will to be valid apply to a codicil.
The testator must possess the testamentary capacity and the codicil must be executed
by the testator in the presence of two witnesses who must be present at the same thing
and who shall attest to the codicil
158
= There could be a Will without codicil but the can never be a codicil without
a Will
The COMMENCEMENT of a codicil is as follows:
“THIS IS THE FIRST CODICIL TO THE LAST WILL of me, Mrs. Jones Emeka of No.2
Ejure Street Isolo Lagos made the 13 day of June 2012”.

FUNCTIONS OF A CODICIL
a codicil performs the following functions.
i. It may affirm the contents of a Will
ii. It may alter or amend the provisions of a Will
iii. It may correct a clerical error in a Will
iv. It may revoke a Will
v. It may revive a Will
vi. It may republish a Will

SIMILARITIES B/W WILL AND CODICIL

a. Both are testamentary
b. Both are ambulatory
c. Both are revocable
d. Both are depository

DIFFERENCES BETWEEN WILL AND CODICIL

b. A will comes first, a codicil comes last
c. A will is independent while a codicil cannot survive in its own.

POINTS TO NOTE:
1. An unclear codicil is invalid and of no effect. A codicil which is unclear or
equivocal will be declared void by the court for its uncertainty
ARMIT V. HIPPKINS
2. However, mis-description of codicil does not make the codicil invalid NOR will it
be invalid because it failed to recite the exact date of the Will.
3. In construing a Will containing an ambiguity, a court may refer to a RECITAL in a
codicil to clarify and explain the Will.

WHEN TO ADVISE A CLIENT TO EXECUTE A FRESH WILL

1. When there is a new or subsequent marriage
2. When there is excess alteration or mutilation of the original will
3. When there is change in finances and assets
4. When there is a change in residence

ETHICAL ISSUES
1. A lawyer should know when to advise for a fresh will R.
2. Advise client on when there could be failure of a gift
3. Duty of confidentiality. Solicitor not to divulge the contents of the Will R. 19
4. Disclosure of conflicting interests R. 17

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 WEEK 15- WILLS 3

LIMITATIONS TO TESTAMENTARY CAPACITY/FREEDOM

The general rule is that a person has the testamentary freedom to devise his property
as he wishes.
ADESUBOKAN V. YUNUSA.

THE EXCEPTIONS TO THE ABOVE RULE WHERE THE RIGHT IS LIMITED ARE IN
THE FOLLOWING:
1. ISLAMIC LAW RESTRICTIONS
It is a rule that a person subject to Islamic Law cannot make a Will disposing of more
than 1/3 of his properties not in accordance with the Islamic Personal Law of disposing
same.
This is applicable to some States Wills Law.
AJIBAYE V. AJIBAYE (where the Kwara State Wills Law was applied) Comment [g86]: In AJIBAIYE V. AJIBAIYE
(2007) ALL FWLR (PT 359) 1321 THE DECEASED
NB = The restriction contained in S. 2 Wills law Kaduna State may be summarized as TESTATOR
follows: Alhaji Disu Ajibaiye a Muslim from Ilorin made
a Will under the Wills Act and disposed his
1. Every person is guaranteed the right to dispose his property by Will estate not in consonance with Islamic law. He
stated in the Will that. I also direct and want
2. This right does not apply to the Will of a person who immediately before his my estate to be shared in accordance with the
death was subject to Islamic law” English law and …..having chosen English law
to guide my transactions and affairs in my life
3. The restriction does not apply only to property but applies to person who are time notwithstanding the fact that I am a
subject to Islamic law. Muslim.

HELD: The Will in dispute is void abinitio for

being contrary to the Wills law Kwara State
This may raise the question, is there any distinction between a person subject to Islamic which was in force; he could not validly make
law and a muslim? a will under Wills Act.
The properties of a Nigerian Muslim are
ANS – NO SEE AJIBAYE V. AJIBAYE subject to the dictates of Islamic law of
inheritance which does not allow disposition
2. CUSTOMARY LAW RESTRICTION anyhow. Having declared that he was a
A person who is under Customary Law cannot dispose by Will Muslim, the testator had subjected himself to
the appl. of wills law Kware State,
 any property which the testator had no power to dispose of by Will or notwithstanding

 otherwise under customary law to which he was subject.

S. 1 OF THE WILLS LAW LAGOS STATE,

IDEHEN V. IDEHEN and Comment [g87]: In IDEHEN V. IDEHEN; the
case concerns the gift of the Igiogbe (the
LAWAL-OSULA V. LAWAL-OSULA house in which the testator lived and died.) to
 In both cases, the testator did not will the idiogbe- family property to their eldest one of the wives of the deceased testator
rather than to his eldest surviving son.
sons. The gifts made to other younger sons were otherwise voided by the
Courts.

ABIA STATE DOES NOT HAVE THE CUSTOMARY LAW RESTRICTION OR THE
ISLAMIC LAW RESTRICTION, THE TESTATOR ENJOYS COMPLETE FREEDOM
TO DISPOSE OF HIS PROPERTY

160
  In ASIKA V. ATUANYA;IT WAS HELD at the court of appeal, the court held that
S.42 CFRN recognizes women as citizens and guarantees the right not to be
discriminated against the right to acquire and own immovable property in Nigeria.
 Those proposition of the respondent relating to the sharing of the property in
accordance with the Onitsha customary law cannot override the provisions of the
Will.
.
3. PROVISIONS TO DEPENDANTS
The testator is required by some Laws to make reasonable financial provisions to his
dependents (wife, husband and children).
His failure to do so, the dependents can apply to Court WITHIN 6 MONTHS OF THE
TESTATOR’S DEATH to vary the Will.
S. 2 OF THE WILLS LAW OF LAGOS STATE.
4. TESTAMENTARY AGE
A testator must be of the required age limit of 18 years or 21 under the Wills Act before
he will have the capacity to make a Will.

THE RULE IN CRADOCK V. PIPER

Where the lawyer is representing himself and other executors
- Generally, they are not entitled to remuneration
EXCEPTIONS:
a. When the remuneration is identified in the Will
b. In the case of a solicitor representing himself and the executors. If the solicitor is
representing himself only, he is not entitled to remuneration.
WHERE EXECUTORS MAKE AN APPLICATION TO THE COURT, THE COURT IS
FACED WITH TWO ISSUES:
i. Generally, they are not supposed to be paid
ii. Where the estate is a complex estate and the time spent by the executors in
administering the estate.

PROFESSIONAL EXPECTATION IN TAKING INSTRUCTIONS TO DRAFT WILLS

The professional should advise on the following:
1. The likely persons to attest to the Will
2. Use simple English in its drafting and ensure that the clauses are not ambiguous
3. To include a Medical Report as to his Client’s mental state of health
4. To determine suitable persons as Executors of the Will
5. To ensure that the Client/testator makes the Will voluntary

INSTRUCTIONS NEEDED TO DRAFT A WILL

1. The full names/ nick names(indicated by Alias…) and address of the testator
2. Particulars of the executors
3. The extent of the testator’s properties and those jointly held

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4. If any previous Will had been made or not, and if the new Will is to revoke or add
to the previous will
5. If gifts of the testator were made inter vivos (while the testator is alive)
6. The particulars of the beneficiaries and the gifts made to them
7. What should happen in the event of the death of a beneficiary in the event of
failure of the gift.
8. The place of origin or ethnic nationality of the testator in to determine whether
there is any native law and custom of restricts the disposition of apply
9. The religion of the testator to determine if he is subject to Islamic law which
restricts disposition of pply
10. Any relatives or dependants of the testator in order to makes reasonable
financial provisions for them if they were maintained.
11. Details of persons who may be appointed as guardians of and infants of the
testator.
12. Any directives the testator may wish to give with respect to his funeral Custody of
the Will
13. Charging clause
14. Residuary gift clause
15. Particulars of wife(wives) and children
16. Particulars of witnesses (at least two-2)

ADVANTAGES OF A SOLICITOR DRAFTING A WILL

1. The solicitor being presumed to be versed in law, will comply with this
requirements of the law when drafting the will
2. The skills possessed by the solicitor will be employed to prepare the good Will
which will reflect client’s instructions
3. The solicitor is likely to be reliable to keep custody of the will to produce it in the
event of the death of the testator
4. Solicitors have been found to be very useful witnesses in the event of any
dispute to prove the due execution of a Will. ADEBAJO V. ADEBAJO

NB = A SOLICITOR SHOULD ENDEAVOUR TO RECEIVE INSTRUCTIONS ON

DRAFTING A WILL IN THE FOLLOWING WAYS.
1. The instructions should be written and signed by the client
2. The instructions may be given in the hand writing of the client
3. Where the instructions are taken by the solicitor, he may ask the client to sign
them even before the Will is prepared.

This is to help in rebutting any allegation of fraud, lack of intention or undue influence.
CUSTODY OF WILLS
These are the means of keeping Wills before the testator’s death. It can be kept in the
following places:
1. Banks
2. At the Probate Registry of the High Court
3. By the testator himself
4. With a trusted younger friend or relation
5. A copy left with his solicitor

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READING OF THE WILL
This is done 7 DAYS after the testator’s burial.

ADVANTAGES OF KEEPING THE WILL WITH PROBATE REGISTRY

a. It complies with the requirements of the law.
S. 35 Administration of Estates law of Lagos State – The court should provide
facilities for safe custody of Wills of living persons
b. It ensures safe custody 0.49 .16 Abuja HCCPR – A person should deposit his
own Will in the court for safe custody and an original Will shall not be delivered
out without court’s direction in writing.
c. It aids in proof of the Will
d. It facilitates the grant of probate

FORMAL PARTS OF A WILL Comment [g88]: THE FORMAL PARTS OF A

WILL
1. Commencement: Describes the document and the maker of the document as his 1.Commencement clause- containing the
act. particulars of the testator/date
THIS IS MY LAST WILL OR THIS IS THE LAST WILL OF ME… 2.Revocation clause
3.Appointment clause
4.Charging clause
2. Date: States the day the will was made / executed 5.Disposition clause
MADE THIS ………… DAY OF ……………….. 6.Residuary clause
7.Testimonium / Execution clauses
3. Revocation Clause: This annuls any earlier Will or codicil made by the testator 8.Attestation
and assists in affirming the present Will a last testamentary act of the testator
I REVOKE ALL FORMER TESTAMENTARY DOCUMENTS OR DISPOSITIONS
MADE BY ME…………….

4. Appointment Clause: This clause appoints the personal representatives and

trustees of the testator
I APPOINT……………………
5. Charging Clause: This clause permits and mandates the PRs And any persons
acting in that capacity to charge for an services they render otherwise their
services would be take rendered gratuitously
I DECLARE THAT MY EXECUTORS SHALL CHARGE OR I AUTHORISE MY
EXECUTORS TO CHARGE…………….

6. Gifts: This is the clause that bequeaths gifts (Legacies and devices) to
respective beneficiaries
I GIVE TO ………..

7. Residuary Clause: This states the person who will be entitle the residue
(remainder) of the estate of the testator
I DECLARE THAT THE REMAINDER OF MY ESTATE SHALL……… I GIVE TO
…………….

8. SUBSTITUTION Clause: In case any gift fails or ceases to exist at the death of
the testator

9. TESTIMONIUM: This links the testator with the Will.

IN WITNESS OF WHICH …………..

10. Execution and attestation Clause

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  SIGNED AS HIS LAST WILL BY THE ABOVE NAMED TESTATOR IN OUR
JOINT PRESENCE AND THEN BY US IN HIS PRESENCE.
 SIGNED BY THE ABOVE NAMED TESTATOR IN THE JOINT PRESENCE
OFUS AND EACH OTHER WHO IN HIS PRESENCE AND THAT OF EACH
OTHER HAVE SUBCRIBED OUR NAMES AS WITNESSES.

ETHICAL ISSUES
1. A solicitor should draft a Will to avoid ambiguity while interpret Rule 14
2. Duty to advise his client as to the restrictions under Islamic customary laws R. IT,
3. There should be no professional negligence, so that the solicitor is not be liable
to the client
E.g. A witness cannot be a beneficiary.
4. A lawyer should not take instructions in client’s home execute exceptional
circumstances – P. 22
5. If the solicitor is the executor of the Will, there should be mixture of client money
or apply with his own R. 23 (2)
6. The duty of confidentiality is highly required in making Wills R. 19
7. The lawyer should always follow the instructions of the client such instructions
should be kept in case of challenges in the execution and reading of the Will
The instructions should be in written form
8. A legal practitioner shall not in the course of making a will make secret profits.
9. The lawyer is duty bound to disclose any conflict interest R. 17
10. Where the solicitor is a beneficiary in a Will, he should comply the rule laid out in
him….. Nye. – Testator to have independent legal advice and service apart from
that given by the benefit – solicitor.

CONTENTS OF A CODICIL
1. Commencement clause
2. Purpose clause
3. Testimonium
4. Attestation and execution clause

THE RULE AGAINST GIFTS MADE IN PERPETUITY

A gift in a Will is said to be made in perpetuity when a gift is made to a beneficiary with
conditions restricting its use, sale or transfer.
The rule against gifts been made in perpetuity is that the gift will be valid upon the death
of the testator but the conditions will be void. This is because the legal title in the gift
has been vested in the beneficiary who can use it the way he likes as the
consequences of he being the owner.

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DRAFT
THIS IS THE LAST WILL of me, Mrs. Aduke Thomas of 12 Aduke Street Ikeja Lagos
(‘The Testator’) made on the 14 day of March 2012.
1. I REVOKE all previous testamentary dispositions made by me, and I DECLARE this
Will to be my last Will.
2. I APPOINT Dr. Lom Thomas of 10 Ikorodu Road Surulere Lagos, Mrs. Denba
Gonjuwa of No. 10 Kent Street Ikoyi Lagos State and Mrs. Comfort Musakari of 67
Dempe Street Mushin Lagos State to be the Executors (Trustees) of my Will.
3. I DECLARE that my Executors or any Professional or person engaged in proving my
Will and administering the estate may charge reasonable fees for their services
4. I GIVE my two storey building at 56 Awolowo Avenue Ikeja Lagos to my only son,
Dr. Lom Thomas of 10 Ikorodu Road Surulere Lagos State.
5. I GIVE the remainder of my estate to my son Dr. Lom Thomas and my daughter
Mrs. Gonjuwa of 10 Kent Street Ikoyi Lagos in equal share.
IN WITNESS OF WHICH, I Mrs. Aduke Thomas (‘The Testator’) have executed this Will
in the manner below the day and year first above written.
SINGED by the Testator, in the presence of us both and at the same time who at her
presence subscribed our names as witnesses.
Mrs. Aduke Thomas ………………………….

1. Name: Kehinde Dukeson(Witness)

Address:
Occupation: Civil Servant Date:
Signature:
2. Name: Ewahin Dillyton(Witness)
Address:
Occupation: Legal Practitioner Date:
Signature:

See sample draft of a Codicil

THIS IS THE FIRST CODICIL to the last Will and testament of me, Mrs. Aduke Thomas
of 12 Aduke Street Ikeja Lagos (‘The Testator’) made on the 10 day of May 2012.
1. I REVOKE clause 5(five) of my Will made on the 2012, and confirm the Will in all
other respects.
2. I GIVE all my residuary Estate to my sister, Funke Thomas of 1 Agege Road Ikeja
Lagos, Dr. Lom Thomas my son and Mrs. Gonjuwa my daughter in equal shares.
IN WITNESS OF WHICH, I Mrs. Aduke Thomas (‘The Testator’) has executed this
Will in the manner below the day and year first above written.
SIGNED by the Testator,
in the presence of us both and at the same time who at her presence subscribed our
names as witnesses.

Mrs. Aduke Thomas ………………………….

1. Name: Kehinde Dukeson(Witness)

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 Address: Occupation:
Civil Servant Date:
Signature:
3. Name: Ewahin Dillyton(Witness)
Address:
Occupation: Legal Practitioner Date:
Signature:

WEEK 18: PROBATE AND LETTERS OF ADMINISTRATION

MEANING OF PROBATE
Probate is an official verification of a Will; admitting the Will.
IT IS GRANTED ONLY WHERE:
a. There is a valid Will
b. Executors were appointed in the Will

PRELIMINARY MATTERS TOWARDS OBTAINING PROBATE

1. Search for the Will at the Probate Registry or Bank etc.
2. If the Will is found, SEND IT WITHIN 14 DAYS to the Court within the jurisdiction
where the testator died
3. The Will is to BE READ AFTER 7 DAYS of the testator’s burial in the presence of
persons interested.
O. 55 r. of the High Court of Lagos (Civil Procedure) Rules 2012.

THE RESPONSIBILITY TO PROVE THE VALIDITY OF A WILL FOR THE

GRANT OF PROBATE
The Executors, also known as the propounders, are to prove the Will for the grant of
Probate in respect of it.

APPOINTMENT AND QUALIFICATION OF EXECUTORS

A LIMITED LIABILITY COMPANY and AN ADULT INDIVIDUAL can be appointed
Executors.
However, a minor and a person of unsound mind cannot be appointed executors.

THE QUALITIES IN APPOINTING EXECUTORS (PERSONAL REPRESENTATIVES)

1. Availability and willingness to act as Executors/personal Representative
2. They are persons of younger ages
3. Honest and reliable
4. People that can work together
5. They will not have any conflict of interest in the estate to be administered
6. Knowledgeable and experienced in administering estates of deceased persons
7. They are resident in places that are of relative cost and proximity to the estate

MODES OF APPOINTING EXECUTORS/PERSONAL REPRESENTATIVES

1. Expressly by them been named in the will
2. Impliedly or by the tenor of the Will

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3. By operation of the Law, e.g. when the chain of executorship will not be allowed to
be broken when all the executors granted probate are dead.
The executor to the last Executor who died will be allowed to apply for Letters of
Administration to continue with the execution of the Will left by the dead
Executors.
S. 28 of the Administration of Estate Law of Lagos State.
4. Substitutional executors
5. By authorization of another to appoint the executors
6. By description
7. Appointment by the Courts when there is a Will but no executors so appointed
therein.
THE NUMBER OF EXECUTORS/ PERSONAL ADMINISTRATORS TO BE
APPOINTED EXECUTORS:
MAXIMUM OF 4 TO BE APPOINTED WITH NO MINIMUM.

ADMINISTRATORs: maximum of 4 and a minimum of 2 can be appointed.

EXCEPTIONS WHERE ONE ADMINISTRATOR CAN BE
APPOINTED are:
a. Sole beneficiary in Will appointed sole executor
b. Trust corporations appointed to be Executor of a Will.
S. 9 AND 24 OF THE ADMINISTRATION OF ESTATE LAW LAGOS.

THE INSTANCES WHERE PROBATE MUST NOT BE GRANTED TO AN EXECUTOR

1. He is an infant
2. The executor is outside the country
3. He is mentally incapacitated
4. The executor was discovered to be the murderer of the testator
5. The executor renounces his appointment as executor
6. The executor appointed has been earlier removed as executor by the Court

DOUBLE PROBATE;
This arises when an executor applies for a second grant of Probate after a first one
has been granted to other Executors duly appointed in a Will.

THE INSTANCES WHERE DOUBLE PROBATE WILL BE GRANTED ARE:

1. The applicant is an infant executor who was denied a grant because of his age so
upon reaching maturity he will be granted a double Probate
2. Where a vacancy exist in the number of Executors, the reserved executors (if more
than 4 were appointed in a Will) will apply to fill it by a grant of double Probate
3. An Executor was abroad and arrived after the grant of probate. He can apply for a
double probate.

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RENUNCIATION OF PROBATE AND TIME LIMIT TO DO SO
Before Probate is granted, it can be renounced by filing FORM 71 of the High Court of
Lagos State (Civil Procedure) Rules 2012 to the Probate Registrar.
The renunciation must be total in all respect to execution of the estate under a Will.
This should be DONE AFTER THE TESTATOR’S DEATH BUT BEFORE PROBATE
IS GRANTED.
HOWEVER, an executor de son tort may be prevented from renouncing probate
because he has already started administering the estate of a deceased.

TYPES OF PROBATE
1. Common Form Probate- this is non- contentious Probate as it is granted without
any action in Court challenging the validity of the Will.
2. Solemn Form Probate- this is a contentious Probate which is granted only after
the action in Court challenging the validity of the Will have been determined.

FACTORS THAT MAKE A PROBATE TO BE CONTENTIOUS.

1. Where the will was not validly made
2. People who applied for the probate are not the appropriate persons to obtain
such grant
3. Placement of caveat at the Registry.

THE PROCEDURE TO OBTAIN PROBATE

Order 58 hcccpr Lagos
STEP 1-
1. Discovery of the Will.
2. Where the Will is discovered, the solicitor or the Executor will need to intimate
the Probate Registry of the discovery of the Will, the testator might have
already deposited the Will at the Probate Registry
3. The executors will apply via a letter to the Probate Registrar for the grant of Comment [g89]: The solicitor writes the
Probate Registrar intimating by of the
Probate attaching following things(CONTENTS OF THE LETTER)
a. CTC of the Will a.Death of the testator accompanied with
certificate
b. Copy of the testator’s death certificate b.The place of death and date
c.The fact that the testator lived within the
All relevant information should be disclosed. jurisdiction of the court
d.The fact that the testator made and
deposited a Will at death
STEP 2 List the name of persons interested or likely to
A date is fixed for the reading of the Will. be interest in the estate of the testator

On the fixed date, the registrar then brings out the Will breaks the sealed wax on
it and reads the Will in the presence of persons present and makes a record of
Comment [g90]: a. Application for grant of
the proceedings of the day. probate
b.Affidavit of attesting witnesses
- AJIBAIYE V. AJIBAIYE c.Oath of Executors
d.Inventory Form
e.Justification of Sureties
The Probate Registrar will, after receipt of the application for probate, give the following f.Bank Certificate (to record the monies in
Banks or shares in company owned by the
FORMS to the Executors to be completed and returned to him: testator before his death)

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STEP 3
Assessment of the Estate is conducted by the Registrar and Estate duty will be paid on
the total asset -10 percent (10%) of the value of the estate

STEP 4
The Forms are duly filled and returned attaching passport photographs of applicants
and the witnesses to the Will
STEP 5
If satisfied, the Probate Registrar grants Probate to the Applicants with the copy of the
Will attached
PROVING A WILL (SOLEMN FORM PROBATE)
1. The executors apply for grant of Probate or if they failed to do so a Notice of
citation will be given to the Executors to either prove the Will or renounce their
EXECUTORSHIP WITHIN 21 DAYS.
O. 55 R. 7 & 8 OF THE HIGH COURT OF LAGOS STATE (CIVIL PROCEDURE)
RULES 2012.
2. If any person is objecting to the grant of Probate, he is to file a CAVEAT (CAUTION)
which is a notice to the Registrar not to grant Probate until the matter is resolved.
The Caveat when filed IS TO LAST FOR 3 MONTHS once entered.
FORM 3 OR 4 OF THE ADMINISTRATION OF ESTATE LAW OF LAGOS AND DAN-
JUMBO V. DANJUMBO.
3. In response to the Caveat, the applicants/executors are to file a Warning/citation
stating their interest in the testator’s estate and requesting the caveator to state his
interests WITHIN 8 DAYS OF RECEIPT OF THE WARNING
4. If the caveator failed to enter appearance by responding within 8 days to the
Warning, he is deemed to have abandoned his claim and probate will be granted to
the Applicants
5. An Affidavit is to be filed by the applicants when the Caveator defaults in
appearance.
6. Conversely if the caveator responded WITHIN THE 8 DAYS and stated reasons for
challenging the validity of the Will, issues have been joined and the
applicants/caveator will go to trial proving / disproving the Will in question.
CHECK LIST OF NECESSARY DOCUMENTS FOR GRANT OF PROBATE
Comment [g91]: stating
 Application for probate where and when he died,
 Declaration of personal property of the deceased.  his last place of residence,
sex and age.
 Death certificate of the deceased NB = The most authoritative death certificate
is FORM D2 issued by the National Population
 Declaration on oath by the executors stating the following Commission.
 a sworn affidavit attesting witnesses to the Will stating that they are witness to
the executed Will Comment [g92]: That the deceased is dead
Date of his death
 Passport photographs of the applicants and Witnesses to the Will. The executors’ belief in the validity of the
Will.
 a copy of the Will shall attached to the application That they will faithfully administer the estate
of the deceased and render accounts to the
terms of the Will

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LETTERS OF ADMINISTRATION
This is issued to enable the personal representatives of a deceased who died without
making a Will, to administer his estate after the death
.
IT IS ISSUED WHERE:
a. A person died intestate (without making a Will) or
b. The testator made a Will with no executors appointed
c. If appointed there is none to act.
d. When a will was made but was rejected by the court
e. Partial intestacy due to absence of residuary clause
An administrator or personal representative cannot act or deal with the deceased’s
estate unless Letters of Administration is granted otherwise his acts are VOID.

CHECK LIST OF NECESSARY DOCUMENTS FOR GRANT OF LETTER OF

ADMINISTRATION
1. Application for letters of administration
2. Death certificate of the deceased
3. Declaration on oath
4. Oath / justification by sureties on behalf of the applicant in a specific penal sum
to guarantee his administration of the estate.
5. A duly completed bond by the applicants to pay the debts and liabilities of the
deceased estate, to distribute the estate and also to make inventory.
6. An authorization by way of a bank certificate issued by the –registrar to a
personal representative or applicant to inquire into the details of the bank
account of the deceased.
7. A duly completed inventory specifically listing the properties of the deceased
person which the administrator wishes to administer
8. Evidence of Newspaper publications.
9. Passport photographs of the applicants and sureties.
10. Declaration of the next of – kin

THE PROCEDURE TO OBTAIN LETTERS OF ADMINISTRATION (WITHOUT A WILL

ANNEXED)
1. An application is made to the Probate Registrar stating:
a. The full names of the deceased
b. The last fixed place of abode of the deceased
c. The names of the proposed administrators
d. Attach a copy of the death certificate of the deceased
2. The applicants should collect, fill and file the Forms from the Registrar as follows:
a. Application for grant of Letters of Administration (without Will annexed)
b. Oath for Administrators
c. Administration Bond
d. Schedules of debts and burial expenses

170
 e. Bank certificate
f. Inventory
g. Particulars of leasehold properties
h. Declaration as to Next of kin
3. Publication in Newspaper for objections within 21 days of the application
3. If there is no objection, the Letters of Administration will then be
granted
THE FACTORS DETERMINING WHO WILL MAKE APPLICATION FOR GRANT OF
LETTERS OF ADMINISTRATION IF THE DECEASED DIED INTESTATE
1. The TYPE OF MARRIAGE contracted by the deceased intestate will determine
who is entitled to make the application.
a. If the intestate conducted a Customary Law marriage, then upon his death native
law and custom on succession of the deceased intestate’s estate will apply.
b. If he married under the Marriage Act, then the provisions of the Administration of
Estate Law of the State where the deceased intestate was resident before his
death will apply.
Note that a minority or life interest (a pregnant wife) is entitled to apply for
Letters of Administration.

THE PRIORITY OF PERSONS ENTITLED TO A GRANT OF LETTERS OF

ADMINISTRATION UNDER SECTION 49 OF THE ADMINISTRATION OF ESTATE
LAW (LAGOS)
1. Surviving spouse (which could be either the husband or wife)
2. The children of the deceased or issues of the children of the deceased
3. Parents of the deceased
4. Brothers and sisters of the whole blood and their issues
5. Brothers and sisters of half blood
6. Grand parents
7. Uncles and aunts
8. Creditors
9. If there are no creditors, then the office of the Administrator-General of
the State can apply
OBUSEZ V. OBUSEZ
LETTERS OF ADMINISTRATION (WITH OR WITHOUT WILL
ANNEXED) DE BONIS NON
This is applied for and granted when Letters of Administration had earlier been
granted but the administration of the estate is not completed because of the death
of the Administrators.
The executor/administrator to the last deceased Administrator will apply for a grant
in order to save the chain of administration.

S. 28 OF THE ADMINISTRATION OF ESTATE LAW.

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LETTERS OF ADMINISTRATION (WITH WILL ANNEXED)
This is issued when:
a. No executor is appointed in the Will
b. The appointment of a sole executor is void
c. The sole executor appointed predeceased the testator
d. The sole executor(s) has renounced Probate
SPECIAL GRANTS OF LETTERS OF ADMINISTRATION
1. Grant to creditors
2. Grant pendente lite- pending the outcome of a litigation in proving/voiding
a Will
3. Grant durante absentia- granted when the executors are abroad
4. Grant ad litem- granted when the executors so appointed are mentally or
physically incapacitated
5. Grant ad colligenda bona- applied for and granted to preserve perishables
in the estate of a deceased intestate
RE-SEALING OF GRANTS
This is applied for when Probate or Letters of Administration is granted in one State
while there are other real properties of the testator/deceased in other States.
The Executors/personal administrators will apply to the Probate Registrar of the High
Court of the other State to re-seal the grant in order to be able to administer the
properties therein.
S. 2 OF THE PROBATE RE-SEALING ACT.

THE PROCEDURE FOR RE-SEALING OF GRANT

1. An application is made to the Probate Registrar informing him of the need to reseal
grant and all the relevant information attaching a CTC of the Probate/Letters of
Administration earlier granted requesting that it be re-sealed
2. The Registrar gives the executors the following Forms to complete and return:
a. Application for re-sealing of Probate/Letters of Administration
b. Oath to lead re-sealing
c. Bank certificate
d. Inventory
e. Particulars of freehold and leasehold property of the deceased
f. Administration Bond
3. The Forms are completed and returned with the original and 2 CTC of the
Probate/Letters of Administration sought to be re-sealed carrying the seal of the
Court that granted it
4. After re-sealing of the grant, the Probate Registrar shall send Notice of it to the
Court that made the original grant
Note that grants from commonwealth countries may be re-sealed in Nigeria in the
above manner.
REVOCATION OF A GRANT OF PROBATE
This is usually the case to common form Probate (uncontested grant of probate).
THE GROUNDS FOR REVOKING A GRANT ARE AS FOLLOWS:
1. When a subsequent Will/Codicil superseding the first Will is discovered after a grant
2. Fraud/ misrepresentation aiding its grant
3. When the testator is not dead.

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4. When the grant is issued to two executors and one becomes insane, it will be
revoked and a new one granted to the sane executor.
5. Where the grant was issued to the Administrator-General; and
6. Where the person to whom the grant was made consents to it been revoked

AN APPLICATION LETTER FOR THE GRANT OF PROBATE:

NDU GABRIELLA & CO

BARRISTERS AND SOLICITORS
NO, 15 BROAD STREET LAGOS ISLAND LAGOS.
OUR REF:
DATE: 21 May, 2013.

To
The Probate Registrar
High Court 12 Ikeja
Judicial Division
Lagos State.
Sir,
IN THE MATTER OF THE ESTATE OF LATE MRS ADUKE THOMAS
APPLICATION FOR GRANT OF PROBATE (RE-SEALING OF PROBATE/ LETTERS
OF ADMINISTRATION)
We are Solicitors to Dr. Lom Thomas, Mrs. Demba Gonjuwa and Comfort Musakari who
are the Executors of the Will of Mrs Aduke Thomas (now deceased) of No. 12 Aduke
Street Ikeja Lagos, who we will refer to herein as ‘our clients’.

It is our clients’ instructions that we apply for the grant of Probate on the Will of Mrs.
Aduke Thomas (deceased) who died on the 10 day of January 2013 and before her
death she lived at No. 12 Aduke Street Ikeja Lagos and within the jurisdiction of this
Court.
Please find attached the following documents for your kind consideration:

a. Certified true copy of the Will of Mrs. Aduke Thomas dated 14 March
2012.
b. Copy of the death certificate of Mrs. Aduke Thomas dated 14 January
2012.
We will appreciate if the necessary Forms to process Probate are made available to us.
Thank you.
Yours faithfully,

NDU GABRIELLA (Principal Partner)

For: NDU GABRIELLA & CO.

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 WEEK 19-PERSONAL REPRESENTATIVES AND ASSENT
MEANING OF PERSONAL REPRESENTATIVE
The term when used includes:
a. Executors
b. Administrators
They are the ones appointed or granted the authority to administer the estate/properties
of a deceased.

REMUNERATION OF EXECUTORS
The general rule is that executors are not entitled to remuneration.

RE ORWELL
THE EXCEPTIONS WHERE THEY MAY BE ENTITLED TO SOME REMUNERATION
ARE AS FOLLOWS:
1. Upon a Court Order
2. Recouping of Out- of pocket expenses
3. There is a Charging Clause in a Will
4. The executor is also appointed a Solicitor

RENUNCIATION OF EXECUTORSHIP
This can be done by the following means:
1. Filing of an Affidavit of renunciation,

O. 55 R. 30 OF THE LAGOS HIGH COURT RULES 2004

2. A failure to respond to a citation WITHIN 21 DAYS by the executors
3. The executors died before taking the grant, see S. 6 of the Administration
of Estate Law of Lagos.

EXECUTORS DE SON TORT (EXECUTORSHIP BY ONES ACTS)

It may arise from the following acts of an individual:
a. An unauthorized interference with the properties in an estate,
ADENIYI JONES V. MARTINS
b. Executors intermeddling with the estate without applying for Probate/
Letters of Administration,
O. 55 R. 8 OF THE HIGH COURT RULES OF LAGOS.
c. A beneficiary intermeddling with the estate.
NB=An executor de son tort must apply for Probate/Letters of Administration WITHIN 3
MONTHS otherwise he is liable to pay fine.

LIABILITIES OF EXECUTORS DE SON TORT

1.Liability for the losses suffered by the estate
2.Liability to pay for services rendered to the estate during his intermeddling in the
estate
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 3.Liability to creditors
4.Liability for personal expenses
5.Liability for payment of estate duty, he is to pay fine; can be cited to take up Probate
etc.
POWERS OF PERSONAL REPRESENTATIVES
a. Power to postpone the distribution of the estate,
S. 47 OF THE ADMINISTRATION OF ESTATE LAW LAGOS
b. Power to sell, mortgage or lease property in the estate
c. Power to appropriate assets
d. Power to deal with and manage the estate
e. Power to appoint trustees
f. Power to run the business or trade of the testator
g. Power to be indemnified his personal cost in running of the estate
h. Power to invest the estate
i. Power or right of action to protect the estate
j. Power or right to carry out action on distress to the estate
k. Power to insure
l. Power to delegate

MODES OF APPOINTMENT OF PERSONAL REPRESENTATIVES

1. Expressly by them been named in the Will
2. Impliedly or by the tenor of the Will
3. By operation of the Law, e.g. when the chain of executorship will not be
allowed to be broken when all the executors granted probate are dead.
The executor to the last Executor who died will be allowed to apply for Letters of
Administration to continue with the execution of the Will left by the dead Executors.

S. 28 of the Administration of Estate Law of Lagos State.

4. Substitutional executors
5. By authorization of another to appoint the executors
6. By description
7. Appointment by the Courts when there is a Will but no executors so
appointed therein.

THE DOCTRINE OF RELATION BACK IN EXERCISE OF POWER TO SUE BY AN

EXECUTOR
The general rule is that a personal representative cannot sue on behalf of the deceased
estate EXCEPT a grant of Probate/Letters of Administration has been obtained.

An EXCEPTION to the above rule is that the executor(s) can commence an action
without a grant (in his personal capacity) but during the pendency of the suit where
a grant is obtained, he is to make an application to the Court to reflect the

175
plaintiff’s status as Administrator(s) of the estate. When the application is granted by
the Court, it will relate back to the date the action was commenced.

NOTE THAT this principle of relation back will only apply when the action is
commenced in the personal capacity of the executor(s).
THE ADMINSTRATORS OF SANI ABACHA V. EKE- SPIFF.

THE DUTIES OF PERSONAL REPRESENTATIVES

1. To prove the Will
2. To ensure the testator is given a decent burial
3. To gather the estate of the deceased
4. To issue assent when necessary
5. To account and keep records of the administration
THE LIABILITIES OF PERSONAL REPRESENTATIVES
1. liability for waste
2. Liability for conversion
3. Liability to creditors or beneficiaries
4. Liabilities for intermeddling with the estate when Probate has not been granted
RELIEFS FROM LIABILITIES OF EXECUTORS/PERSONAL REPRESENTATIVES
These are situations when the liabilities so incurred by a personal representative will be
waived or forgiven.
They are as follows:
1. By the express provisions in the Will appointing the Executors. An EXCEPTION is
where it is a fiduciary duty that is breached by the executors
2. Relief obtained from the beneficiaries/ creditors concerned in a Will
3. Relief from Court
4. A plea of limitation of Statute

THE PRECAUTIONARY MEASURES TO BE TAKEN BY PERSONAL

REPRESENTATIVES IN THE ADMINISTRATION OF THE ESTATE
1. Keep proper accounts
2. Operate a separate Bank account for the estate
3. Make payments by cheque
4. Avoid payment of estate money into personal account
5. Obtain receipts for all payments or transactions on the estate
6. Keep and obtain counter-folds of all receipts issued

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THE ACCOUNTS TO BE KEPT /FILED BY THE PERSONAL REPRESENTATIVES
AND THE TIME OF FILING SAME
The accounts to be kept are:
1. Inventory of the property of the deceased
2. Vouchers
3. An account of administration to include:
a. All monies spent
b. Out of pocket expenses
c. All debts paid
d. All assets of the estate
4. Attach a verifying affidavit
The account is to be filed in Court EVERY 12 MONTHS until the administration is
completed. O. 55 R. 46(9) OF THE LAGOS HIGH COURT RULES 2012

INSTANCES WHEN AN ACCOUNT WILL BE CALLED BY THE PROBATE

REGISTRAR
1. Where a compliant of maladministration is made
2. An application that a personal representative be removed is made
3. When the personal representative applied himself to be discharged or surrender the
estate
4. On completion of the administration

ASSENT BY PERSONAL REPRESENTATIVES

An Assent is used to vest title in realty on the beneficiaries because it is the rule that
title in the estate of the testator is vested in the personal representative.
An Assent need not be by Deed.
S. 3 OF THE ADMINISTRATION OF ESTATE LAW LAGOS.

JURISDICTION ON THE USE OF ASSENT

This depends on the area and the applicable Law as follows:
(a.) In Western Nigeria and in Lagos, an assent must be used to vest title
over a leasehold property on the beneficiary because the deceased real
property first vests in the personal representative before same can be
later vested in the beneficiary. RENNER V. RENNER
(b.) In States of the FORMER NORTHERN AND EASTERN NIGERIA
(COVERED BY THE CONVEYANCING ACT), a formal Assent is not
required and the beneficiary takes his gift from the Will.
NOTE THAT it is only personal representatives/ executors that can
grant and confer Assent, trustees cannot do so except by a Formal
conveyance.
An ASSENT IS NOT A REGISTRABLE INSTRUMENT and no stamp duty is
expected to be paid on it because estate duty was earlier paid before a grant of
Probate/Letters of Administration was made.

177
S. 40 (11) of the Administration of Estate Law of Lagos.

THE CONDITIONS OF A VALID ASSENT

1. Must be in writing
2. Signed by all the personal representatives/executors
3. The property to which the assent is granted must be certain
4. The beneficiary must be stated
RENNER V. RENNER
DISCHARGE OF PERSONAL REPRESENTATIVES
This can be applied for in the Court that granted Probate/Letters of Administration when
the personal representative has completed the administration of the estate and final
accounts filed.

DUTIES OF PERSONAL REPRESENTATIVES WHICH MAY ARISE AFTER THEIR

DISCHARGE
This means new duties arising for the personal representative to handle after he has
been discharged by the Courts.

This may arise on any of the below ground:

a. New properties of the testator were discovered, the personal
representative will be called to complete the administration
b. The personal representative was discovered to have breached
his duty of trust
THE SEQUENCE/ORDER IN ADMINISTERING OR WINDING-UP A DECEASED’S
ESTATE
1. Give the deceased a decent burial
2. Collect the deceased’s assets into an inventory
3. Apply to obtain a grant of Probate/Letters of Administration
4. Settle all debts and liabilities of the deceased
5. Distribute the estate in accordance with the Will if any or the Native Law and custom
of the deceased intestate
6. Render accounts of administration to the Probate Registry as required by Law
7. Apply to the Court to be discharged after the administration of the estate is
completed.
THE FORMAL PARTS OF AN ASSENT
1. Commencement/date
2. Parties clause
3. Vesting clause
4. Declaration clause
5. Acknowledgement clause
6. Testimonium
7. Execution
8. Attestation

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SEE A SAMPLE DRAFT OF AN ASSENT:

WE, MR. TOPE BIANGA OF 12 BUYO STREET IKEJA LAGOS, DR. LOM THOMAS
OF 10 IKORODU ROAD SURULERE LAGOS AND MATAKA DANMUSA OF 17 EDU
CLOSE IKEJA LAGSO, THE PERSONAL REPRESENTATIVES (EXECUTORS) OF
MRS. ADUKE THOMAS (Deceased) of 12 Aduke Street Ikeja Lagos who died on the
17 day of November 2011 and whose Will was proved on the 10 day of December 2011
in the Probate Registry of the High Court of Lagos State:

1. DO HEREBY on this …. day of ……………2012 as such personal representatives,

ASSENT to vesting in Dr. Lom Thomas of No. 10 Ikorodu Road Surulere Lagos
State (the Beneficiary) ALL THAT two storey building at 56 Awolowo Avenue Ikeja
Lagos covered by a certificate of Occupancy No. 876534 dated 12/11/2004 and
registered as No.24 page 45 and volume 5647 of the said Mrs. Aduke Thomas at
the time of her death.

2. WE DECLARE that we have not previously given or made any assent or

conveyance in respect of any legal estate in the property or any part of it

3. WE ACKNOWLEDGE the right of Dr. Lom Thomas (the Beneficiary) to the

production of the Probate of the Will (the possession of which is retained by us) of
the deceased and to the delivery of copies.

IN WITNESS OF WHICH we, Tope Bianga, Dr. Lom Thomas and Mataka DanMusa
have set out our respective hands to this Assent the day and year first above written.
SIGNED, AND DELIVERED
By the within named
Tope Bianga ………………………………

IN THE PRESENCE OF:

Name:
Address:
Occupation:
Signature:
Date:

SIGNED, AND DELIVERED

By the within named
Dr. Lom Thomas ………………………………
IN THE PRESENCE OF:
Name:
Address:
Occupation:
signature:
Date:

SIGNED, AND DELIVERED

By the within named
Mataka DanMusa ………………………………
IN THE PRESENCE OF:
Name:
Address:
Occupation: signature:
Date:

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 WEEK 20 -PROPERTY LAW TAXATION

APPLICABLE LAWS
1. Land Use Act
2. Capital Gains Tax Act
3. Personal Income Tax Act (PITA)
4. Stamp Duties Act
5. Land Instrument Registration Law (LIRL)
6. Land Use Charge Law Lagos
7. Value Added Tax Act
8. Companies Income Tax Act (CITA)

WHAT IS TAXATION?
Taxes are compulsory charges by the (government) on the income of an
individual, corporation or trustee as well as the value of an estate or gift.
It is a compulsory levy imposed by competent authority or organ of government
for public purposes.
Generally, taxes are levied directly or indirectly. Direct taxation occurs where
person are taxed to pay for no particular services or goods delivered, but simply for
the maintenance of government and its services.
Indirect taxation occurs where persons are charged for services rendered to
them, transactions conducted or for their activities.

TAXES COLLECTED BY THE FEDERAL GOVERNMENT

i. Companies Income Tax
ii. Withholding tax on companies (witholding tax on companies) residents
of Federal Capital Territory Abuja and non-resident individuals)
iii. Petroleum Profit tax
iv. Value Added Tax
v. Education Tax
vi. Capital Gains Tax (on residents of the FCT Abuja) bodies corporate
and non-resident, individuals)
vii. Stamp duties (on bodies corporate and residents of
viii. Personal Income Tax in respect of members of the forces, residents of
the FCT Abuja, members of Nigeria Police Force and Staff of the
Ministry of Finance Affairs Abuja and non-resident individuals.

TAXES COLLECTED BY STATE GOVERNMENT

i. Personal Income Tax pay as you earn and direct (self assessment)
ii. Witholding tax (individuals only)
iii. Capital Gains Tax (individual only)
iv. Stamp duties on instrument executed by individual
v. Road taxes
vi. Pools betting and lotteries and gaming and casino tax individuals

180
 vii. Business premises registration fees
viii. Development fees for naming street in a state capital
ix. Markets (where state finances are involved)
x. Right of occupancy fees over lands owned by state in urban areas of the
state.

THE PLACE OF PAYMENT OF THE TAXES PAYABLE ON A SPECIFIC

TRANSACTION
This depends on the class/status of the party making the tax payment or the location as
follows:

1. If it is a COMPANY, federal Staff in Government establishments and

MILITARY PERSONNEL ; NON RESIDENTS/FCT RESIDENTS, it is to
be paid to the Federal Government collected by the Federal Inland
Revenue Services( FIRS)
2. If it is a transaction between individuals, or a civil servant or workers in
the State, or transactions over State Lands, the State Government
collects the taxes through the State Inland Revenue Services.

TAXABLE TRANSACTIONS
a. Sale of Land
b. Mortgage
c. lease.

OVERVIEW OF TAXES PAYABEL IN PROPERTY TRANSACTION

CAPITAL GAINS TAX (CGT)

These are levies charged on the gains accruing upon disposal of assets as
provided for under the Capital Gains Tax Act.
Capital gains tax shall be chargeable on the total amount of chargeable gains
accruing to any person in a year of assessment after making such deductions as S. 2(1)
(CGT)
These gains are those resulting from increases in the market value of assets to a
person who does not regularly offer them for sale and in whose hands they do not
constitute stock-in-trade.
The tax is on the gain of the disposed property implying then that if no gain is
made the tax cannot be charged.
The rate of capital gains tax is 10%.
Before computing the gains, “allowable incomes” are S. 13 (CGT)

ALLOWABLE INCOME is income that is wholly, exclusively and necessarily incurred

for the acquisition of the property

181
THE ALLOWABLE INCOME INCLUDES:
1. Amount paid for the acquisition of the property
2. Incidental cost of acquisition
3. Amount incurred in enhancing the value of the property
4. Money spent on the establishment, preservation or defending the title or right
over the asset.
5. Cost incidental to the disposal of the asset. Such cost of advertising, costing
valuation of asset.
6. Fees, commission or remuneration paid to professionals surveyors, Auctioneers,
Agent, Valuers, Solicitors.
THE EXCEPTIONS (unallowable income)-
a. Cost of disputing the taxable portion eg engaging service of a Solictor to institute
action.
b. Direct Labour put into improvement of the Property shall not allowed e.g Mr. A wants
to paint the house himself through his family members; he would not be allow to
deduct payment for the direct labour- ORAM V. JOHNSON
c. Upon redemption of mortgage and reconveying property to the mortgage, it does not
amount to disposition of assets. This is because a mortgage transaction is not sale.
d. Devolution of property to beneficiaries by a personal representative does not amount
to disposal of interest, CGT will paid.

NB: However, where the executor sells the property to a party in order to raise money
that is taxable.

PERSONS AND ORGANISATIONS EXEMPTED FROM CAPITAL GAINS TAX IN

RESPECT OF PROPERTY DISPOSAL BY THEM.
I. Religious, charitable or educational institution of a public character.
II. Statutory or registered friendly society
III. Cooperative society registered under the cooperatives society law of a state.
IV. Trade Union registered under Trade Union Act s. 26
V. Gains accruing to local government
VI. Gains accruing to any company and authority established S. 27 by Law to
purchase and export commodities from Nigeria
VII. Disposition by way of gift
S. 40.
FORMULAE
1. Consideration received
2. Cost of purchase of the property
3. Subtract cost of purchase from consideration to get the gain
Less
4. Allowable income
CGT 10% of (Total Gain – Total Allowable Income)

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2. STAMP DUTIES
These are duties (taxes) imposed on and raised from stamps charged on instruments,
parchments and other legal documents.
TYPES- FIXED AND AD VALOREM
When the stamp duty is paid, the document is stamped by an impression of a red wax
or other makr being made on the document.
Some documents attract duties at FLAT or FIXED rate e.g power of Attorney registered
with AGIS.
Other document attract duties ad valorem
The federal Government (national) has the right to legislate on stamp duties.
The rate `OF 3 % is charged as stamp duties on the value of transactions in many
States in Nigeria.
Stamp duty is to be paid WITHIN 40 DAYS but when ad valorem, it is to be paid
WITHIN 30 DAYS
NB For up stamping, additional stamp duties will be paid.
OWONIBOYS TECH SERVICES V. UBN.

EFFECT OF UNSTAMPED DOCUMENT

a. The document will not be admissible in evidence. However, the Court
may order it ot be admitted in evidence upon immediate payment of the
stamp document OKWUWOBI V. ISHOLA
b. The document will not be registered.
c. It will attract a penalty.
3. PERSONAL INCOME TAX
Personal income tax is tax paid on profits of an income as opposed to profits
arising on the disposal of capital assets.
It is payable by individuals, communities, families, trustee, or executors,
partners in partnership S 2, 4, 8, PITA.

INCOME CHARGEABLE UNDER PERSONAL INCOME TAX

a. Gain or profit from any trade, business, profession or vocation.
b. Any salary, wage, fee, allowance or other gain or profit from employment
including compensation, bonuses
c. Gain or profit including any premiums arising from a right granted to any other
person for the user or occupation of property
d. Dividend, interest or discount.
e. Any pension, charge or annuity
f. Any profit, gain or other payment.

TAX CLEARANCE CERTIFICATE

Tax clearance certified (TCC) on the income of a person for the 3 years
immediately preceding the current year of assessment may be issued to a person
under the following circumstances.

183
TAX CLEARANCE CERTIFICATE IS ISSUED WHEN:
a. An individual has fully paid his personal income
tax or
b. Where no tax is due on his income.
c. When an individual is not liable to pay income tax
S. 84 (1) of the Personal Income Tax Act.

CONTENTS OF A TAX CLEARANCE CERTIFICATE

a. Chargeable income
b. Tax payable
c. Tax paid
d. Tax outstanding

WHEN DOES A CLIENT NEED TO TENDER HIS TCC

a. Transfer of interest in land
B. Application for loan from government
C. Application for subsidy and aids in agriculture
D. Signing as a Surety for Bad
E. Application for a grant of Certificate of Occupancy
F. Application for registration of a company or Business
G. Approval of Building Plans
H. Application for allocation of market stalls
SECTION 85(1) PITA.

4. TENEMENT RATES
Tenement rates are charges imposed on houses and buildings within a state.
The major features of tenement is the presence buildings and also occupation of
the building by persons.
NB Tenement rate is the same as Land Use Act which is obtainable in Lagos State.
The State House of Assembly prescribe Legislations for assessment of
tenement although the ultimate beneficiaries of the rates are the LOCAL
GOVERNMENT IN THE STATES.

5 MISCELLANEOUS CHARGES AND FEES

These are other forms of charges made in the course of property transfers,
though not described as tax, are charge imposed with the aim of raising revenue for
government.
a. Ground Rent: Usually charged by the Governor of a state for grant of right of
occupancy
SECTION 5 LAND USE ACT.
B. Consent fee
C. Registration fee: This is a requirement for the grant of the Governor’s consent
for alienation of property subject to a right of occupancy under S. 22 LUA. It is
also a requirement for registration of any clear of transfer or mortgage or lease.
184
 D. Tenement Rate: Charges on buildings and occupation: It is shall not be charged
on buildings occupied and used as:
 Religious centres
 Cemeteries and burial grounds
 Non-profit making institutions engaged in charitable and educational purpose.

b. Value Added Tax (VAT): This is a consumption tax: It is tax payable on Comment [g93]: NOT DISCUSSED IN CLASS
manufactured goods and on services rendered or employed by consumers.

It is levied at each stage of the consumption chain and borne by the final consumers.

VAT is administered and managed centrally by the FEDERAL INLAND REVENUE

SERVICES (FIRS) in close cooperation with Nigeria Custom Service (NCS)

- DISTRIBUTION OF THE PROCEEDS.

15% to Federal Government;
50% to State Government & FCT
35% to Local government.

LIABILITY FOR FAILURE TO PAY TAX

PAYMENT OF TAXES IS COMPULSORY

1. CIVIL LIABILTY-: An action may be instituted to person to recover the tax as
debt.
2. CRIMINAL LIABILITY/PENALTY: S. 40 FIRS Act
On conviction, such a person shall be liable to pay the tax withheld in addition to a
penalty of 10% of the tax and the prevailing CBN minimum ____________and
imprisonment for a period of more than ______________.
3. If notice of demand to pay is served on the persons income tax and he fails to do
so within one month, attracts a penalty S. 96(4) PITA.
4. Where personal income tax is not paid and TCC obtained through fraudulent
means, misrepresentation. It is a crime punishable with N500.00 fine
imprisonment on both.
5. After contest of assessment, and there is no all (ie the assessment is final and
conclusive), the goods and other assets of the person liable to pay will be
distrained in order to satisfy the sums out against him.
NB
LEVY is a compulsory payment imposed by government which includes taxes, fines

ETHICAL ISSUES
1. Duty to act within the bounds of the law R. 15 Do not advise a client to work
towards tax evasion. Tax evasion as distinct from tax Avoidance.
2. Duty to keep record of all taxes paid by client.
3. Duty not be professionally negligent as to incur excess costs.

185
 4. Do not delay the payment of tax so as to avoid bringing the client within
penalties.
5. Do not misappropriate taxes and fees payable to the state R. 23.
6. Do not deliberately pay to the wrong authority, pay to the appropriate authorities.
7. All money collected from client must be deposited in the Client Account.
8. Duty of confidentiality R. 11.
9. Duty to pay taxes on fees collected by the Solicitor for professional services.

NOTE
SECTION 12 PERSONAL INCOME TAX
Every person other than a Governemtn employee must keep record of his
personal incomes for tax purposes.
Default attracts fine
N100,000.00 for individuals
N500,000.00 for corporate bodies.

Withholding Tax: There is a duty imposed on individuals deduct tax and permit same to
the government. Failure to do so is called withholding.

CLASS EXERCISE
Chief Clifford Sanusi brought a plot of land from state government in 1970 for
N100,000.00 He completed building consisting a block of four flats (3 bedrooms each).
He spent N900,000.00 to complete the project.
In 2007, he sold the block of flats to Alhaji Rita Odia, the Sebe-sebe of Oyo State
for N5 million after renovating the building with N500,000.00
Vike Idris Esq. is the solicitor handling the sale on behalf of the parties. He
advised Chief Clifford Sanusi to pay his capital gain tax.
Assuming the Solicitor was paid N500,000.00 compute the capital gain tax to be
paid.

ANSWER
1. Consideration received N5 million
2. Cost of purchase of property N100,000
3. Gain = 5,000, 000 – 1000,000 = 4,900,000
4. Allowable income
Building cost 900,000
Renovation 500,000
Solicitors fees 500,000
1960,000

5. Gain less total allowable income 4900,000

1900,000
3,000,000
6. 10% of (total Gain – Total allowable income)

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 = 10/10 x 3,000,000
Capital Gain Tax = N300,000.00
REVISION QUESTIONS
WHAT IS THE EFFECT OF THE CONSTITUTION ON TAX JURISDICTION
Nigeria being a Federation, the tax jurisdiction is influenced by the division of legislative
powers under the CFRN, a unit of government can only impose tax on matters it can
legislate on. –S.4(1) CFRN 1999

IF AN ESTATE VALUER SELLS PROPERTY, WILL HE PAY CGT?

No, he will not. Such taxes will be paid by him as Personal Income Tax or a
Companies Income Tax. This is because such property sold (or selling such property) is
his stock-in-trade which sale does not qualify as a disposal of assets to warrant the
charging of capital gains tax.

WHO TAKES THE PROCEEDS OF CAPITAL GAINS TAX

STAMP DUTIES
Where CGT and stamp duties are collected by state.
They will be deposited into a consolidated fund of the state.
Even where the Federal Government collects CGT and stamp duties, it is
expected to remit it back to state based on Duration formula ie based on how much
was collected from each state.
There must be an Act of the National Assembly specifying how such tax is to be
shared.

187