A piece of land can look like an excellent investment and still be legally unsuitable for the project you have in mind. In Nigeria, a buyer may discover after payment that the property is affected by government acquisition, a reservation, a proposed infrastructure corridor, competing claims or restrictions on its use. This is why checking the title alone is not enough. Before buying land in Nigeria, investors should establish who has the legal interest in the property, whether that interest can be transferred, whether the land is affected by government acquisition and whether it can legally be used for the proposed development. In Lagos, for example, this may require title searches, survey verification or charting, and enquiries with the relevant government authorities.
This is why proper due diligence is important. Before committing funds, the investor should establish whether the seller has a valid interest in the land and the legal authority to transfer it. It is also important to determine whether the property is affected by government acquisition or other restrictions and whether it can be used for the investor’s intended purpose. In practical terms, charting involves plotting the property’s survey information against relevant official land and survey records to determine where the parcel falls and whether it overlaps an acquisition, reservation or other mapped restriction. It should, however, be treated as one part of the due-diligence process rather than a substitute for title and registry searches.
Compulsory Acquisition of Property
What is commonly described as government acquisition may, under Nigerian law, involve the compulsory acquisition of an interest in land or the revocation of a right of occupancy for overriding public interest under section 28 of the Land Use Act. The right to acquire and own immovable property anywhere in Nigeria is recognised under section 43 of the Constitution of the Federal Republic of Nigeria 1999 (as amended).1 That right operates within Nigeria’s wider constitutional and statutory land framework, including the Land Use Act 1978.
Section 44 of the Constitution provides safeguards in cases of compulsory acquisition, including requirements relating to the lawfulness of the acquisition, payment of compensation and access to a court for the determination of a claimant’s interest and compensation.2
Under section 28 of the Land Use Act, the Governor may revoke a right of occupancy for overriding public interest.3 This includes circumstances where land is required by the State or a Local Government for public purposes, or by the Federal Government for federal public purposes.
For an investor, the important point is not simply that the government has the power to acquire land. It is whether the particular property being offered for sale is affected by an existing acquisition, reservation or other government interest that could affect the proposed investment.
A property may look suitable for development while carrying legal restrictions that affect its ownership, use or value.
What Should an Investor Check Before Buying?
a. Verify the Title and Ownership of the Land: The first step is to verify the title and ownership of the land. An investor should establish whether the seller has a valid interest and the legal authority to transfer it. This involves examining the root of title, the documents through which the seller acquired the property and any subsequent transactions affecting ownership.
These may include a Certificate of Occupancy, Deed of Assignment, registered conveyance or allocation documents depending on the transaction. These documents should also be independently verified against the records available at the land registry. Where the property belongs to a family, community, or corporate entity, the authority of the persons selling the property should also be established. A document presented by a seller should not, on its own, be treated as conclusive evidence that the title is valid and free from encumbrances.
b. Confirm the Government Acquisition Status: The investor should also confirm whether the land is affected by government acquisition or any other government interest. This requires appropriate searches and enquiries from the relevant authorities. In Lagos State, for example, the Lands Multipurpose Desk provides a land information certificate service relating to whether land is free from State government acquisition.4 It is equally important to distinguish an existing acquisition from a proposed infrastructure project. The announcement of a proposed road, seaport or other development does not automatically mean that every parcel within the surrounding area has been acquired. At the same time, the absence of visible government activity on the land does not establish that it is free from acquisition.
c. Verify the Survey Plan and Boundaries: The survey plan should also be independently verified. A registered surveyor can verify the coordinates and boundaries of the property and, where the relevant official records are available, assess whether the parcel overlaps another property, government land, a reservation or a proposed infrastructure corridor. The investor should also confirm that the land physically inspected corresponds with the land described in the title documents.
However, survey verification alone is not enough. It does not establish ownership or confirm that the land is free from government acquisition. It must be considered together with the title and acquisition-status searches.
d. Investigate Litigation and Other Interests Affecting the Land: An investor should further investigate whether there are disputes or other interests affecting the property. These may include pending litigation, competing ownership claims, mortgages, leases, existing sale agreements or other third-party interests. Where the land is occupied, the circumstances surrounding the occupation should also be examined.
This is particularly important where the seller relies on family or community ownership, inherited interests or a chain of previous transactions. Physical possession of land does not, by itself, establish ownership.
e. Confirm the Permitted Use and Development Requirements: Finally, an investor should confirm that the proposed use of the land is permitted. Owning or acquiring an interest in land does not automatically mean that the property can be developed for any purpose. A property intended for a warehouse, logistics facility, industrial plant or commercial development may be affected by zoning requirements, development control regulations, environmental considerations, access restrictions or infrastructure plans.
The investor should therefore understand the applicable land-use designation, the permitted development and the approvals that may be required. Access to roads, drainage, utilities and other supporting infrastructure should also be considered, particularly where the investment is based on the anticipated growth of an emerging commercial or infrastructure corridor.
Red Flags to Watch Out For
Certain warning signs should prompt further investigation before any money is committed. These include a seller who refuses to allow independent searches, inconsistencies between the survey plan and the physical property, unresolved ownership claims and assurances that the land can simply be regularised without confirmation from the relevant authority.
Investors should also be cautious when the attractiveness of a transaction is based mainly on the expectation that a nearby infrastructure project will increase land values. Proximity to a proposed development does not establish that the land is legally available, that the intended use will be permitted or that the investment will appreciate.
Where a material issue is identified, the investor should obtain appropriate legal and technical advice before proceeding. Depending on the circumstances, this may require further searches, clarification from the relevant authority, renegotiation of the transaction or a decision not to proceed.
Conclusion
For a land investor, the real question is not simply whether a property is well located or attractively priced. It is whether the interest being purchased is valid, transferable and capable of being used for the purpose for which it is being acquired.
Government acquisition, reservations, competing claims, litigation and planning restrictions may not be visible from the land itself or from the documents presented by a seller. They have to be investigated through the appropriate title, registry, survey and planning records.
This is particularly important where land is being marketed on the strength of a proposed road, port, industrial project or other major infrastructure investment. Proximity to an infrastructure project may create an opportunity, but it does not, by itself, establish that the land is legally available or suitable for development.
For investors, the safest approach is therefore straightforward: verify the property, verify the seller, verify the survey, establish the government status of the land and confirm that the intended use is permitted before committing substantial funds.
Footnotes
1. 1999 CFRN, Section 43
2. 1999 CFRN, Section 44
3. 1978 LUA, Section 28
4. The Lagos State Government Lands Multipurpose Desk
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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