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AN APPRAISAL OF ALIENATION OF RIGHT OF OCCUPANCY UNDER THE NIGERIAN LAW: ISSUES AND CHALLENGES
TABLE OF CONTENTS
CHAPTER ONE: GENERAL INTRODUCTION
1.1 Introduction – – – – – – – – 1
1.2 Aim and Objectives of the Research – – – – –
1.3 Scope of the Research – – – – – –
1.4 Statement of the Problem – – – – – – 3
1.5 Justification of the Research – – – – – – 6
1.6 Literature Review – – – – – – – 6
1.7 Methodology – – – – – – – 12
1.8 Organizational Layout – – – – – – 12
CHAPTER TWO: ANALYSIS OF THE NATURE AND SCOPE OF RIGHT OF
OCCUPANCY
2.1 Introduction – – – – – – – 14
2.2 Types of Right of Occupancy – – – – – 15
2.3 Statutory Right of Occupancy Expressly Granted – – – 15
2.4 Statutory Right of Occupancy Deemed Granted – – – 16
2.5 Customary Right of Occupancy Expressly Granted – – 18
2.6 Customary Right of Occupancy Deemed Granted – – – 19
2.7 Acquisition of Right of Occupancy by Acts of Parties – – 21
2.8 Acquisition of Right of Occupancy by Court Order – – 21
2.9 Contents of Rights of Occupancy – – – – – 22
2.10 Duties and Obligations of a Holder of a Certificate of Occupancy- 22
2.11 Rights of a Holder of a Certificate of Occupancy – – – 23
2.12 Nature of Interest Created by Right of Occupancy – – – 24
2.13 How to Obtain a Certificate of Occupancy (For both Actual and
Deemed Grants) – – – – – – – – 25
2.14 Effect of Grant of Right of Occupancy by the Governor
CHAPTER THREE: ALIENATION OF RIGHT OF OCCUPANCY.
3.1 Introduction – – – – – – – – 30
3.2 Meaning of Alienation – – – – – – 32
3.3 Nature and Scope of Alienation – – – – – 34
3.4 Types of Alienation – – – – – – – 35
3.5 Consequences of Alienation without Requisite Consent – – 38
3.5 Legal Restriction on Alienation of Land – – – – 41
CHAPTER FOUR: AN ANALYSIS OF THE REQUIREMENT OF GOVERNOR’S CONSENT FOR ALIENATION UNDER LAND USE ACT.
4.1 Introduction – – – – – – – – 46
4.2 Brief History of Governor‟s Consent.- – – – – 46
4.3 Emerging Issues in Governor‟s Consent since Savannah Bank v. Ajilo 53
4.4 Problems with Securing Consent: – – – – – 63
4.5 The Point at Which Governor‟s Consent Is Required. – – 68
CHAPTER FIVE: SUMMARY AND CONCLUSION
5.1 Summary – – – – – – – – 70
5.2 Observations/Findings – – – – – – 71
5.3 Recommendations – – – – – – – 73
5.4 Conclusion – – – – – – – – 75
Bibliography – – – – – – – – 76
ABSTRACT
One of the problems this research discovers is that of conflict of interpretation of the requirement of consent provision as provided under sections 21 and 22 of the Land Use Act. This problem leads to conflicting decisions by the Apex court, the development that always puts the lower courts in dilemma as to which of the decisions of the court to apply in cases relating to alienation of land. Another problem the research discovers is that of noncompliance in that the cumbersome nature of the consent requirement makes people to alienate land without complying with the requirement of the law. Therefore, the research appraised and analyzed consent requirement, the hardship meted out by its interpretation by the courts. It also looked at the issues and challenges of the research and finally proffered some solutions to same. The methodology adopted in this work is doctrinal which is library oriented. The research found that there is conflict of decisions by the courts on cases relating to alienation of land. It also found that consent requirement is too wide, thus making the powers of the governor to be discretionary and cannot be challenged even by the holder himself. It again found that people engage in land transaction without complying with the requirement of the law. Finally, it has been recommended that the apex court should judicially and judiciously look at their previous decisions on consent requirement in order to avoid conflict of interpretations. It also recommended that consent clause should completely be removed or time limit for governors to give consent be fixed and if it expires, consent should be deemed granted. Banks need to be very careful by ensuring that mortgagors obtained consent and from proper authority.
CHAPTER ONE
GENERAL INTRODUCTION
1.1 Introduction
The results of population pressure, urbanization and socio-economic growth have great social and economic impact on land issues in Nigeria. This therefore makes people to move from rural to urban areas and therefore, congested urban areas are in need for expansion but land is too scarce.2 Hence, to acquire land became even impossible because of the cost of compensation. These difficulties faced by both the people and governments make it necessary for the government to do something about land distribution in Nigeria. Consequently, the Rent Control Panel was appointed in 1976 and saddled with the responsibility to study the system of land distribution and speculation. They therefore recommended among other things, that the federal military government should take over all land in the country. This and many panels and committees necessitated the enactment of the Land Use Act which provides the framework of national policy in Nigeria and enables the government to control the use of which the land can be put in all parts of the country.
To make the above policy of nationalizing land effective, the land use Act provides for
“right of Occupancy” 8 which gives the holder a mere right of possession and not ownership.9 Hence, two types of occupancies are provided for namely: Statutory Right of Occupancy (SRO) and Customary Rights of Occupancy (CRO). However, the Act stipulates that those rights granted to holders can only be alienated when governor‟s consent is first had and obtained. And failure to secure that consent may render any transaction or alienation null and void.
Therefore the above provisions of the land use Act make land transactions very difficult, thereby making grants very complicated. These problems can among others be attributed to inadequacy of the law regulating land transaction (Land Use Act), on one hand and the conflict of interpretation of the requirement of Governor‟s consent on the other. Thus, the research aims at appraising and analyzing alienation of right of occupancy, consent requirements and the problems it created. It also looks at the issues and challenges of the area and proffers some solutions.
1.2 Aim and Objectives of the Research
The aim of this research is to appraise alienation of the right of occupancy under the
Nigerian law. The objectives of the research are:
a. To analyze Governor‟s consent under the Land Use Act,
b. To examine problems and controversies created by the consent requirement as well as the hardship meted out by the interpretation of sections 21 and 22 of the Land Use Act.
c. To also bring out some issues and challenges and finally offers some solutions to the problems associated with the area of the research.
1.3 Scope of the Research
This research work is restricted to Alienation of Right of Occupancy in Nigeria. Hence, more emphasis is placed on right of occupancy, alienation of right of occupancy and the requirement of governor‟s consent as provided under Sections 21 and 22 of the Land Use Act. More so, the work touches some aspects of alienation under customary law, other laws and some other legislation As such, local cases on alienation of land in Nigeria, some of the provisions of the Land Use Act and other legislations on alienation of land are referred to.
1.4 Statement of the Problem
One of the problems the research discovers is that of consent requirement, to which the Act stipulates that it must be first had and obtained from the governor of a state. This is because even though there have been interesting developments from the courts since the ruling in Savannah Bank Ltd. v. Ajilo concerning governor‟s consent, yet some decisions appear to be directly opposite of Ajilo‟s case. This creates problems of conflict of interpretation of the provisions of governor‟s consent as well as controversial decisions by the courts. This is because, the Supreme Court has recently gone back to its earlier decision in Ajilo and held that any alienation without the consent Government of the Governor or Local Government as the case may be is null and void
Thus, in Nigeria Industrial Development Bank Ltd v. Olalomi Industrial Ltd . There was a mortgaged transaction without Governor‟s consent and the mortgagor wanted to invalidate the transaction on ground of lack of governor‟s consent. The court in refusing the mortgagor‟s application held inter alia that “… It is my view that it will be in the interest of justice to do so rather than allow the mortgagor to eat his cake and still have it back, the court shall resist at all cost the attempt at using it as an engine of fraud or cheating or dishonesty‟‟.
Again, in Alh. Ayotunde Seriki v. Sefi’u Olukorede . It was held that one cannot have a right of action when he or she comes to a court of justice in an unclean manner. It goes to say that equity will not allow a person to benefit or profit from his own crime, fraud, immorality or illegality as in the case of failure to obtain the Governor‟s consent to alienate his or her right .
However, the decision in Awojugbagbe Light Industry v. Chinukwe represents a means to moderate the excesses of the wisdom in Ajilo. One of the main issues in that case was whether the land use Act forbids some forms of agreement to alienate. The Supreme Court held that the holder of a statutory right of occupancy is certainly not prohibited by S. 22(1) of the Land Use Act 1978 with a written agreement in form of negotiation which may end with a written agreement for presentation to the government for his consent or approval. This is because, the Act does not prohibit a written agreement evidencing an intention to transfer or alienate land. Thus, to hold that a contravention or non-compliance of S. 22 of the Act occurs at a time when the holder of Statutory Right executes or seals a deed of mortgage is tantamount to defeating the spirit and intendment of S. 22 of the Act.
Another decision that creates controversy is Okuneye v. F.B.N. Plc where the bone of contention was whether governor‟s consent is necessary for equitable mortgage. The court held that a mere deposit of title deeds of property to secure a loan is not an alienation of the holder‟s statutory right of occupancy by the definition under S. 22 of the Act, and therefore, governor‟s consent is not required. This decision appears to have
been reached per incurriam as no reference was made to S. 51 of the Act where mortgage is comprehensively defined to include a second and subsequent mortgage and equitable mortgage as well. So the Act unequivocally stipulates that any alienation made without governor‟s consent is null and void notwithstanding the fact that the alienation is by assignment, mortgage, transfer of possession, sublease or otherwise.
Finally, in Chief Belonwo Ugochukwu v. Cooperative and Commerce Bank Nigeria
Ltd . The Supreme Court frowned at conducts similar to that in Ajilo‟s case where it held that a mortgagor who was to seek and obtain consent shall not be allowed to turn round and assert that the mortgaged deed was null and void for lack of governor‟s consent and that he shall not be allowed to benefit from his own wrong.
Surprisingly, in recent case of Union Bank of (Nig.) Plc & Anor v. Ayodire & Sons (Nig) Ltd , the Supreme Court went back to its earlier decision in Ajilo and held that a mortgagor can still turn round to benefit from his wrongful conduct. This unfortunate development put the Court of Appeal in a dilemma as to which of the Supreme Court‟s decision to apply in the case of Pharmatic Industrial Project Ltd v. Trade Bank (Nig)
Plc 84 others that came before the Court of Appeal barely two years after the Supreme Court‟s decision in Union Bank v. Ayodire
Another problem of this research is that of non-compliance. This is because the cumbersome nature of consent requirement makes many people to alienate land without governor‟s consent. Thus, the aims and objectives of the Land Use Act (which vests all lands on the governor and gives him power to give consent for any alienation) have been defeated.
The above, among other problems leads to the questions as to whether the theory and practice of governor‟s consent has helped to realize the objective of the Act and as to whether the land is available to those who are willing, ready and able to use it. Hence, the research centres on analysis of those problems and proffers some solutions to same.
1.5 Justification of the Research
This research is necessitated as a result of the problems of alienation of land in Nigeria. Thus, it would be of great assistance to legal practitioners, most especially those specialized in property and conveyancing law, law lecturers, judges and justices of various courts of record, law students, banks and their customers who participate in mortgage transactions and any other person who has interest in land transactions. Consequently, people that engage in land transactions would be enlightened and finally comply with the requirement of the law.
1.6 Literature Review
The area of this research is statutory oriented and it came into effect when the Land Use Act came into operation. Therefore, most of the literatures about this area can only be traced from 1978 to date. One of the authors that contributed much on this area is
Omotolar J. A. . He highlighted the necessity that facilitated the enactment of the Land Use Act, the impact of Sections. 22 and 26 of the Act i.e. issues of governor‟s consent and effect of non-compliance with the requirement of consent. Yet he does not take necessary steps to stipulate the impact of the interpretative misconceptions of the Act by the courts. This is what this research sets out to achieve
James, in his book critically analyzed consent requirement. He discussed problems of sale or assignment and mortgage transactions, particularly the hardships that both the mortgagors and mortgagees face. However, he made little attempt to discuss the emerging issues with consent requirement. This is a gap that this research fills.
Taiwo,31 is another recent author that contributed hugely on the aspect of alienation of land in Nigeria. He succeeded in analyzing issues of Right of Occupancy, impact of
Right of Occupancy and requirement for governor‟s consent. He also made effort to highlight many recent cases on the area. However, no attempt was made by the author to analyze the inadequacies of the Act, more particularly Sections 22 and 26.
Yakubu M.G. viewed that any transfer of Right of Occupancy by assignment, lease, sale, mortgage, sublease, bequest or otherwise made without the consent of the governor first had and obtained is invalid. However, this assertion was probably made prior to the Supreme Court decision in the case of Okuneye v. F.B.N Plc. Hence, the author did not talk about the problems of interpretation of the provisions dealing with alienation of right of occupancy .
Again, Olong A.D.M maintained that consent requirement to alienation of land in Nigeria has its philosophical basis in the concept of ownership. Hence, its potentials are so great that in recent times it has become the focus of government policy. He again opined that since alienation is one of the incidents of ownerships, one can therefore alienate his interest in land without consent of anybody. But with the advent of the
Land Use Act, title to land became vested in the Governor who serves as a trustee to all Nigerians. However, the author did not take time to dwell on the subject matter let alone hammer on the conflicting decisions of the courts in trying to interpret Sections 21 and 22 of the Land Use Act respectively.
Another good literature about this area is that of Taiwo L. who analyzes some of the problems associated with the practical implications of section 22 of the land use Act, however he made little or less contribution about the current problems with the
sections.
Madaki, Succeeded in highlighting some of the cumbersome nature of the governor‟s consent. Yet, he did not take time to dwell on the emerging issues related therein. That is issues of recent Supreme Court‟s conflicting decision that creates problems to lower courts
Aboki, makes some criticisms about the requirement of governor‟s consent on alienation of Right of Occupancy. However, he placed much emphasis on the decision in Savannah Bank Ltd. v. Ajilo.
Taiwo, in his article took time to discuss problems with consent requirement for alienation of right of occupancy and how the courts interpreted the phrase „consent first had and obtained‟. However, he has not contributed on the conflicts of interpretation of the consent requirement by our courts. And this lacuna is what this research has set out to achieve.
Another literature on this research is that of Owolabi, who did an expository analysis on alienation of land in Nigeria. However, he emphases more on the general provisions of the Land Use Act and the methods of alienation prior to the commencement of the
Act.
Taiwo, E.A. in his article titled; „‟The Effects of Failure to Obtain Consent to Alienate Rights under the Land Use Act and the Emerging Equities‟‟ brought out and analyzed the hardships suffered by the mortgagees. But he has not emphasized on conflicting decisions of the court which we submit are the causes of any hardships that people might suffer in land transactions.
Olawoye, discussed the right of a holder to alienate his right of occupancy and opined that such right is hinged on governor‟s consent. Though, he explained right of occupancy, alienation and governor‟s consent, he however did not discuss the major problems with consent. And these problems and controversies are what this research aims at achieving.
Omotola examined the provisions of sections 21 and 22 that deal with the requirement of governor‟s consent on alienation of right of occupancy. He recommended that governors should adopt the provisions in section 22 (2) in all cases dealing with transfer of interest arising before the Act and permit the citizens to follow the old practice relating to their transfer while giving prompt consent where required in an automatic manner. He however did not discuss the conflict of interpretation of the provision of section 22 generally.
Babaji, made enormous contributions about this area of research. He highlighted the problems created by the entire Land Use Act, namely it leads to underdevelopment of the economy, and the issue of the “Half Hectare Rule” etc. Unfortunately, he made no attempt to analyze the problems created by S. 22, more particularly the issue of conflicting interpretation of the provisions of sections 21 and 22 of the Act.
The courts too have over the years demonstrated some level of judicial activism on this area. Hence, there are various judicial pronouncements on the concept of alienation of land in Nigeria, when to alienate, how to (the requirement of governor‟s consent), etc.
Thus, in the locus classicus case of Savannah Bank Ltd. v. Ajilo the scope of the provision of S. 22 of the land use Act (which is one of the most central issues of this research) came up for determination. In that case, Chief F. R. A. Williams (SAN) contended that the provisions of S. 22 of the Act implies that, any alienation made without governor‟s consent was unlawful and consequently any transaction conducted therein was illegal going by the provision of S. 26 of the same Act. The court held that the alienation was unlawfully made and the mortgage transaction was illegal, notwithstanding the fault of the grantor (Ajilo) to secure governor‟s consent.
However, in Oil Feld Supply Centre Ltd. V. Joseph Lloyd Johnson. The same supreme court held that certain equities will not permit the company to benefit from their own illegality”. This goes with the equitable maxim that says “he who comes to equity must come with clean hands”
Again, in Okunneye v. F. B. N. Plc the court held that governor‟s consent is not required while creating an equitable mortgage. This decision also contradicts the provision of section 51 of the Land Use Act which defines mortgage to include equitable mortgage.
Recently, the Supreme Court in Union Bank of (Nig.) Plc & Anor v. Ayodire & Sons (Nig) Ltd went back to its previous decision in Ajilo, notwithstanding the distinction of the facts of the two cases and the effects of the decision on mortgagees who suffer for the wrongs they have not committed.
Therefore, the above cases even though they highlighted the significant contributions of the courts in the area of this research, yet, they ended up in confusing the practical application of governor‟s consent. For, some of the cases were decided in the opposite by one court.
As such, the advertised motive of curbing land speculation and removal of the bottlenecks in land acquisition and tenure has been watered down by the event of difficulties brought about by the consent provision of Land Use Act. Thus, the writer embarks on this research to identify the causes and effects of these difficulties and itemize some recommendations that will help in solving the problems associated with alienation of land in Nigeria.
1.7 Methodology
The methodology adopted in this research is doctrinal i.e. library oriented research that comprises:
a. Primary authorities which includes Act of the National Assembly, Laws of the states and case laws.
b. Secondary authorities, which comprises relevant information from leading authorities, textbooks on the subject matter of the research, journal articles, opinions of specialists and practitioners on aspect of law relating thereto.
1.8 Organizational Layout
Chapter one of this research deals with the General Introduction of the subject matter. It also highlights the Objectives of the research, Scope of the research, Statement of the Problem of the research, Justification of the research and Organizational Layout.
Chapter two is Analysis of the Nature and Scope of Right of Occupancy. It starts with an Introduction, Types of Right of Occupancy, Acquisition of Rights of Occupancy,
Contents of Right of Occupancy, Duties and obligations of a Holder of a Certificate of Occupancy, Rights of a Holder of a Certificate of Occupancy Nature of Interest Created by Right of Occupancy, How to Obtain a Certificate of Occupancy and Effects of Grant of Right of Occupancy by Government, Tenure of Right of Occupancy.
Chapter three is titled Alienation of Right of Occupancy. It starts with an Introduction, Meaning of Alienation, Nature and Scope of Alienation, Types of Alienation, Consequences of Alienation Without consent and Legal Restriction on Alienation of Land.
Chapter four deals with An Analysis of The Requirement of Governor‟s Consent for
Alienation under the Land Use Act, It starts with Introduction, Brief History of Consent
Requirement, One Who Seeks for Governor‟s Consent, Philosophical Basis for
Governor‟s Consent, Emerging Issues of Governor‟s Consent Since Savannah v. Ajilo and Problems with Securing.
Chapter five is a Summary and Conclusion which comprises, Summary, Findings, Recommendations, and Conclusion.
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