ARTICLE
13 April 2021

Overview Of Land Policy In Nigeria

The Land Use Act 1978, which was enacted to ease and control the administration of the land system in Nigeria is the fulcrum for land policy in Nigeria
Nigeria Real Estate and Construction
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The Land Use Act 1978, which was enacted to ease and control the administration of the land system in Nigeria is the fulcrum for land policy in Nigeria. The Act regulates the ownership, acquisition, administration, which includes land allocation, registration of title, etc, and management of land within the states and Federal CapitalTerritory of Nigeria.

Under the Land Use Act, the control and administration of land are vested on the State Governor of the State where the land is situated. Hence, the States have control over the ownership, use, development, and administration of land in Nigeria. Section 1of the Act provides that "all lands comprised in the territory of each state in the Federation are vested in the Governor of that State and such land shall be held in trust and administered for the use and common benefit of all Nigerian in accordance with the provisions of the Act".

Section 2 of the Act provides that all land in urban areas shall be under the control and management of the Governor of each State, and all other lands shall be under the control and management of the Local Government, within the area of jurisdiction of which the land is situated. By the provisions of the above-cited Section 1 and 2 of the Act, the State Governor, and the Local Government are the administrators of land and are empowered by the provisions of the Act to allocate land by granting a statutory right of occupancy to individuals and corporations.

The Land Use Act outlines the means and manners of the use and administration of land in Nigeria. Section 3 of the Act, which includes the power to designate land as urban or rural, provides that "subject to such general conditions as may be specified in that behalf by the National Council of States, the Governor may for the purposes of this Act by order published in the State Gazette designate the parts of the area of the territory of the State constituting land in an urban area". This framework is an integral part of the Act that defines the policy placed in the context of urban land administration.

Section 5(1) of the Act also empowers the State Governor to grant a statutory right of occupancy to any person for all purposes in respect of the land. By the provision of Section 9 of the Act, a Certificate of Occupancy will be issued by the State Governor, as evidence of a right of occupancy. This right of occupancy granted entitles the holder to use and occupy the land to the exclusion of others. The right of occupancy is granted to individuals and companies to occupy, develop and use the land for a period not exceeding 99 years.

It is also lawful for the Local Government in respect of land not in an urban area to grant customary rights of occupancy to any person or organisation for the use of land in the Local Government areas for agricultural, residential, grazing, and other purposes as provided in Section 6(1) of the Act.

Section 22 of the Act provides that Certificate of Occupancy holder cannot alienate, transfer of possession, assignment, sub-lease, or mortgage without the consent and approval of the Governor. It states as follows;

"It shall not be lawful for the holder of a statutory right of occupancy granted by the Governor to alienate his right of occupancy or any part thereof by assignment, mortgage, transfer of possession, sublease or otherwise howsoever without the consent of the Governor first had and obtained:

(1) Provided that the consent of the Governor-

(a) shall not be required to the creation of a legal mortgage over a statutory right of occupancy in favour of a person in whose favour an equitable mortgage over the right of occupancy has already been created with the consent of the Governor:

(b) shall not be required to the reconveyance or release by a mortgage to a holder or occupier of a statutory right of occupancy which that holder or occupier has mortgaged and that mortgage with the consent of the Governor:

(c) to the renewal of a sub-lease shall not be presumed by reason only of his having consented to the grant of a sub-lease containing an option to renew the same.

(2) The Governor when giving his consent to an assignment mortgage or sub-lease may require the holder of a statutory right of occupancy to submit an instrument executed in evidence of the assignment, mortgage, or sub-lease and the holder shall when so required deliver the said instrument to the Governor in order that the consent given by the Governor under subsection (1) may be signified by endorsement thereon".

Ownership of Land by Foreigners

As earlier mentioned the Land Use Act vests all lands comprised in the territory of each state in the Federation on the Governor of that State and such lands are to be held in trust for the benefit of all Nigerians. This begs the question of whether foreigners (non-Nigerians) have the right to ownership of land in Nigeria.

Foreigners have the right of ownership to land in Nigeria, however, there are restrictions and conditions imposed by the various state regulations to be complied with before such rights can be exercised. The Land Use Act has no express restrictions on the rights of foreigners to own land in Nigeria. However, the foundation for the transfer of rights of ownership of land to foreigners was laid down in Sections 22 and 46 of the Act.

The Land Use Act as the principal legislation has an impact on the ownership and acquisition of land by foreigners in Nigeria by Section 22 of the Act, which prohibits the alienation of a statutory right of occupancy without the consent of the state governor. This means that before a foreigner can acquire land in Nigeria by way of assignment, mortgage, transfer of possession, sublease, or otherwise, the consent of the Governor must be first had and obtained. The Land Use Act empowers states to make regulations and the conditions applicable for the transfer of proprietary rights to a foreigner, to give effect to the provisions of this section.

The power for the states to make regulations is rooted in Section 46(1) of the Land Use Act which provides that "the National Council of States may make regulations for the purpose of carrying this Act into effect and particularly with regard to the transfer by assignment or otherwise howsoever of any rights of occupancy, whether statutory or customary, including the conditions applicable to the transfer of such rights to persons who are not Nigerians".

The Power of the Federal Government to Take over any Land for the Public Use

The Federal Government has the power to take over land for public use by simply notifying the state government where the land is located and the state governor is mandated to revoke a right of occupancy in event of the issue of a notice by or on behalf of the Head of the Federal Government if such notice declares such land to be required for public purpose as provided by Section 28(4) of the Land Use Act. Upon receipt of the notice, the title of the holder of the right of occupancy becomes extinguished immediately.

The power of the state government to take over any land for the public purpose

Land Use Act by the provision of Section 28(2) empowers the State Government or the Local Government to revoke a right of occupancy for overriding public interest within the state or the requirement of the land by the Government of the Federation for the public purpose of the Federation. A notice for the acquisition will be issued by the public officer authorized to act on behalf of the Governor to be given to the holder of the right of occupancy.

Where the right of occupancy is revoked to override public interest, the holder and the occupier shall be entitled to compensation for the value as at the date of revocation of their unexhausted improvement as provided in Section 29 of the Land Use Act. Compensation, as provided in Section 29(4), shall be in respect of the following;

  • The land for an amount equal to the rent if any, paid by the occupier during the year in which the right of occupancy was revoked.
  • Building, installation, or improvement for the amount of the replacement cost of the building, installation, or improvement thereon.
  • Crops on the land apart from any building, installation, or improvement thereon for an amount equal to the value prescribed and determined by the appropriate officer.

By the provision of Section 33, where a right of occupancy in respect of a developed residential building has been revoked, the Governor has the discretionary right to offer in lieu of compensation resettlement in another place by way of reasonable alternative accommodation.

Where a person accepts resettlement in place of compensation, his right to compensation shall be deemed to have been duly satisfied and no further compensation shall be paid to such person as stated in Section 33(3) of the Land Use Act.

Acquisition and registration of land in Nigeria

In acquiring land in Nigeria, both the seller and buyer may have recourse to the following steps or procedures:

  • The first step with making enquiries on the land to be purchased to reveal any encumbrances or physical defects on the land. This due diligence can be carried out by the purchaser's solicitor who must examine the title of the land to be purchased.
  • The next procedure is for the vendor to deduce his title to the subject land to be sold. This is achieved by presenting the appropriate title documents that show the history of all transactions that have been had on the land and documents relating to the land, to the purchaser or the purchaser's solicitor.
  • A formal contract of sale of land is executed between the purchaser and the vendor to show commitment to the sale of land. Upon preparation of a contract of sale, the following event is to take place;
    • Payment of a deposit of the purchase price of the land to the vendor or his solicitor;
    • Signing of the contract of sale by parties to the transaction and their respective witnesses;
    • Issuance of the purchase receipt by the vendor to the purchaser;
    • Handing over all documents affecting the land by the vendor to the purchaser.
  • The next step required is for the purchaser's solicitor to investigate the root of the title of the land. Investigation can be carried out at the land registry, court registry, probate registry, Corporate Affairs Commission, and also carrying out a physical inspection of the land.
  • After due diligence has been conducted and the contract of sale of land has been exchanged between parties, the next step to the acquisition of land is to prepare a deed of assignment stating the terms of the transaction. At this stage, the balance of the purchase price of the land is paid and the deed of assignment is executed between the assignor (vendor) and assignee (purchaser).
  • The final step in the land acquisition process is for the perfection of the title acquired. There are three major procedures required for the perfection of the title, which can be summarized as follows:
    • Obtaining Governor's consent,
    • Stamping of the property transfer instrument; and
    • Registration of the document.

Conclusion

Every human being in a society is entitled to acquire land in any area of the society because it serves as a source of material wealth. To regulate the land acquisition, ownership, use, and development in Nigeria, there are several laws enacted by state governments regulating such a process. However, the foremost laws regulating the acquisition and ownership of lands and landed properties in Nigeria are the 1999 Constitution of the Federal Republic of Nigeria and the Land Use Act of 1978.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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