Buying land can be one of the largest financial decisions an individual, family, company or investor makes.
Yet one of the most common mistakes is to treat the transaction as a simple exchange:
“I have the money. The seller has the land. We sign an agreement and I pay.”
Land transactions rarely work that simply.
A seller may possess documents that appear genuine but do not establish a transferable interest. A Certificate of Occupancy may exist over land whose underlying title is disputed. A plot may have been sold to more than one person. A family member may purport to sell land without the authority required under applicable customary law. The land may also be affected by a government acquisition, encumbrance, mortgage, litigation, planning restriction or other interest that is not obvious from an inspection of the property.
This is why legal due diligence should happen before substantial payment not after a problem arises.
The central question is not merely:
“Does the seller have documents?”
It is:
“Does the seller have a legally recognisable interest in this particular land, and can that interest validly be transferred to me?”
What Is Land Due Diligence?
Land due diligence is the process of investigating the legal, documentary, physical and regulatory status of a property before completing the transaction.
Depending on the property and location, this may involve:
– examining the seller’s root of title;
– conducting an official land-registry search;
– verifying the identity and boundaries of the property;
– checking survey information;
– investigating encumbrances and competing interests;
– confirming the seller’s authority to sell;
– checking government acquisition or planning issues;
– reviewing existing litigation or claims;
– examining applicable consent and registration requirements; and
– ensuring the transaction documents properly protect the buyer.
The exact procedure differs across Nigerian states because land administration, registration systems and applicable regulations are not identical everywhere.
For example, in the Federal Capital Territory, AGIS provides title-search and land-record verification services and identifies title status, ownership and related records as matters capable of being verified through its system.
To perform Land Due Diligence:
1. Start With the Seller’s Root of Title
Do not begin your investigation by asking only for the seller’s latest document.
Ask:
How did the seller acquire this land?
This is the seller’s root of title.
The answer could involve:
– a government allocation;
– a statutory or customary right of occupancy;
– a deed of assignment;
– a deed of conveyance;
– inheritance;
– a family or communal grant;
– a court judgment;
– a vesting assent;
– a transfer from a company;
– or another legally recognised mode of acquisition.
The documents should tell a coherent story.
For example, if the seller claims to have acquired the property through a previous owner, you should investigate the previous owner’s title rather than automatically accepting the seller’s document at face value.
The Supreme Court’s decision in Ogunleye v Oni (1990) 2 NWLR (Pt. 135) 745 illustrates an important principle: where a person relies on a grant as the basis of title, questions may arise concerning the title of the person who purportedly made that grant. The Court also made clear that a Certificate of Occupancy does not automatically cure the absence of a valid underlying title.
Practical lesson
Trace the title backwards.
The document presented by the seller is only one part of the investigation.
2. Conduct an Official Land Search
A private document supplied by the seller is not a substitute for an official search.
A land-registry search can help determine matters such as:
– who is recorded as having an interest in the property;
– the nature of the registered interest;
– whether the title corresponds with the property being sold;
– whether there are registered encumbrances;
– whether a mortgage or other interest has been registered;
– and whether the documents presented by the seller correspond with registry records.
The appropriate registry depends on where the property is situated.
In the FCT, for example, AGIS provides a legal-search process and describes title search as a means of verifying land ownership, title status, encumbrances and related records.
Do not rely solely on a search conducted by the seller or agent.
The buyer’s legal representatives should independently verify the property.
3. Verify the Survey and Physical Identity of the Land
A document can describe land, but you must also establish that the land described in the document is actually the land being sold.
This is where survey verification becomes important.
The survey should be examined against the physical property and, where appropriate, official cadastral records.
Check:
– the location;
– coordinates;
– size;
– boundaries;
– beacon information;
– survey plan;
– plot number;
– district or layout;
– adjoining properties; and
– consistency with the title documents.
This is particularly important where the seller simply takes a buyer to an undeveloped plot and says:
“This is your land.”
A buyer should not assume that physical possession of a piece of land establishes legal ownership of it.
In the FCT, AGIS identifies survey data, site plans and cadastral information as services used for land identification, development, registration and verification.
4. Check Whether the Land Is Subject to Government Acquisition or Planning Restrictions
A property may appear vacant and available for sale while being affected by government acquisition, planning restrictions or other land-use considerations.
This is particularly important for undeveloped land.
A buyer should investigate whether the property:
– falls within a government acquisition;
– forms part of an approved layout;
– is properly identified within the relevant planning framework;
– is affected by road expansion or other public projects;
– has restrictions affecting its proposed use; or
– is suitable for the buyer’s intended development.
This matters commercially.
A buyer purchasing land for a shopping centre, estate development, warehouse, school, hospital or other commercial project should not stop at proving ownership.
The buyer also needs to know:
Can I lawfully use this property for the purpose for which I am buying it?
5. Investigate Encumbrances and Competing Interests
A property may have more than one person or institution interested in it.
Potential issues include:
– mortgages;
– charges;
– leases;
– existing assignments;
– court orders;
– pending litigation;
– caveats or restrictions;
– family claims;
– adverse possession or occupation claims;
– government interests; and
– competing purchasers.
This is one reason an official search is so important.
A seller’s statement that:
“There is no problem with the land.”
is not a substitute for independent verification.
The legal due-diligence process should seek documentary evidence rather than relying on assurances.
6. Confirm That the Seller Has Authority to Sell
One of the most overlooked issues in land transactions is authority.
Who exactly owns the interest?
And who has authority to dispose of it?
If it is an Individual seller: Verify the person’s identity and compare it with the title documents.
If it is a Company seller: Investigate the company’s corporate status and authority to dispose of the property.
Depending on the circumstances, corporate approvals and appropriate execution documents may be required.
Estate or deceased owner’s property
Do not assume that a relative of a deceased owner automatically has authority to sell.
The estate’s legal representatives and applicable succession documents must be examined.
If it is a Family land: Family land requires particular caution.
Under applicable customary law, the authority of the family head and the involvement or consent of principal members may be material to the validity or enforceability of the transaction. Nigerian appellate decisions have repeatedly considered the consequences of defective dealings with family property.
A buyer should therefore establish:
Who owns the land, who manages it, and who must participate in the transaction?
7. Understand the Land Use Act Requirements
The Land Use Act 1978 remains central to land administration in Nigeria.
Among other things, the Act regulates the alienation of rights of occupancy.
Section 21 addresses alienation of customary rights of occupancy, while section 22 addresses alienation of statutory rights of occupancy and requires the prescribed consent for relevant transactions. Section 26 provides consequences for transactions or instruments that purport to confer or vest interests contrary to the Act.
This is why a buyer should not treat “we have signed the agreement” as the end of the transaction.
The applicable consent, documentation and perfection requirements must be determined for the particular property and jurisdiction.
The Supreme Court has also recognised that an agreement or negotiation leading to a transaction requiring consent is not necessarily the same thing as completing an unlawful alienation without the required consent. The distinction can matter in structuring transactions.
Important distinction
Signing a document, paying money, obtaining possession and perfecting title are not necessarily the same legal event.
A carefully structured transaction should account for each stage.
8. Do Not Assume a Certificate of Occupancy Automatically Means “Safe Title”
This deserves emphasis.
A Certificate of Occupancy is an important land document, but it should not end the buyer’s investigation.
In Ogunleye v Oni, the Supreme Court considered a situation in which a Certificate of Occupancy had been issued despite an earlier competing interest. The Court recognised that the certificate did not prevent the court from examining the underlying title.
The practical lesson is simple:
Verify the title behind the document.
Ask:
– Who originally owned or held the interest?
– How was the interest acquired?
– Was the land properly allocated or granted?
– Was there an earlier title?
– Were subsequent transactions properly authorised?
– Does the registry record support the document?
– Is the land correctly identified?
9. Inspect the Property, But Do Not Confuse Possession With Ownership
Physical inspection remains important.
Look beyond the seller.
Ask: Who is actually occupying or using the property?
A tenant, caretaker, farmer, developer, squatter, neighbouring owner or another person may have an interest or claim that deserves investigation.
If someone is occupying the land, find out why.
For developed property, investigate existing tenancies, leases, occupants and other third-party interests.
For undeveloped land, inspect the boundaries and surrounding properties.
A site inspection does not replace legal due diligence.
It complements it.
10. Review the Transaction Documents Before Paying
The buyer should not wait until after payment to review the legal documents.
Depending on the transaction, documents may include:
– offer letter;
– contract or agreement for sale;
– deed of assignment;
– deed of sublease;
– deed of conveyance, where applicable;
– power of attorney, where relevant;
– survey plan;
– title documents;
– consent documents;
– company resolutions;
– estate/succession documents;
– receipts and evidence of payment; and
– documents required for registration/perfection.
The documents should clearly identify:
– the parties;
– the property;
– the consideration;
– payment terms;
– completion obligations;
– possession;
– title documents to be delivered;
– consent obligations;
– registration/perfection obligations;
– warranties and representations;
– consequences of default;
– indemnities where appropriate; and
– dispute-resolution provisions.
For substantial transactions, the agreement should be structured around the legal and commercial risks identified during due diligence.
A Practical Pre-Payment Land Due-Diligence Checklist
Area – What to Verify
Seller – Identity and legal capacity
Root of title – How the seller acquired the property
Registry – Registered ownership and title status
Encumbrances – Mortgages, charges, restrictions and competing interests
Survey – Location, size, boundaries and coordinates
Government acquisition – Whether the land is affected by acquisition or other public interest
Planning – Permitted/intended use and relevant planning considerations
Occupation – Who is physically occupying or using the land
Family/estate issues – Required authority, consents and succession documents
Company transaction – Corporate authority and execution requirements
Transaction documents – Sale agreement, deed and supporting documents
Statutory requirements – Applicable consent and registration/perfection requirements
Payment – Conditions that should be satisfied before substantial payment
Common Mistakes Buyers Make
1. Paying because the price is “too good to miss”
Urgency is not due diligence.
A discounted property can become an expensive dispute.
2. Relying on the estate agent
An agent may facilitate the transaction, but the buyer should independently verify title.
3. Checking only the Certificate of Occupancy
The document may not answer every question about the property’s root of title or competing interests.
4. Paying the full purchase price before investigation
This can significantly weaken the buyer’s commercial position if problems are discovered later.
5. Buying based on physical inspection
Seeing land and possessing land are not the same as establishing good title.
6. Ignoring family or succession issues
A person standing before you may not necessarily have the legal authority to dispose of the property.
7. Treating registration as an afterthought
Title perfection is part of the transaction strategy, not merely administrative paperwork.
When Should You Involve a Property Lawyer?
Ideally, before you pay a substantial sum or sign an agreement that commits you to the purchase.
A property lawyer can coordinate the legal investigation, identify defects in title, review the transaction structure, conduct or supervise appropriate searches, examine the root of title, advise on statutory requirements and negotiate protections for the buyer.
This becomes especially important where:
– the property is high-value;
– the seller’s title is complicated;
– the land is family-owned;
– the seller is a company or estate;
– the property is under development;
– there are existing occupants;
– the property is intended for commercial development;
– the land is within a government scheme or acquisition area;
– there is an existing mortgage or encumbrance; or
– the transaction involves substantial financing.
FAQs
1. Can I buy land without a Certificate of Occupancy?
The absence of a Certificate of Occupancy does not automatically mean that no legally recognisable interest exists in the land. Nigerian land interests can arise through different legal sources. However, the absence of a C of O or other formal title document should prompt careful investigation of the seller’s root of title and the applicable land-registration position.
2. Is a Certificate of Occupancy proof that the seller owns the land?
Not necessarily in the absolute sense. The Supreme Court has recognised that a Certificate of Occupancy does not prevent examination of the underlying title where that title is challenged. The buyer should therefore investigate the root of title rather than relying on the certificate alone.
3. Can I conduct a land search myself?
Administrative procedures differ by jurisdiction. In principle, buyers can make applications for official searches where the relevant registry permits it. For significant transactions, however, professional legal assistance can help interpret the search result and connect it with the seller’s documents and the transaction structure.
4. Do I need Governor’s Consent when buying land?
It depends on the nature of the interest and the transaction. Sections 21 and 22 of the Land Use Act regulate alienation of customary and statutory rights of occupancy respectively. The applicable consent or approval should therefore be determined from the title and circumstances of the particular transaction.
5. Should I pay before conducting a land search?
A buyer should ordinarily complete appropriate title and property due diligence before making an irreversible or substantial payment. If commercial circumstances require an initial payment, the payment arrangement should be carefully structured and documented.
6. Can a family member sell family land?
The answer depends on the nature of the family land, the applicable customary law and the authority of the persons participating in the transaction. A buyer should establish that the persons purporting to sell have the necessary authority and that the required family participation or consent has been obtained.
7. Is land due diligence only necessary for expensive properties?
No. The financial value of the transaction affects the level of commercial exposure, but defective title can create problems regardless of the purchase price. The appropriate level of due diligence should reflect the property, transaction and risk involved.
Conclusion
Buying land should not begin with:
“How much is the land?”
It should begin with:
“What exactly am I buying, from whom, and what evidence establishes that the interest can lawfully be transferred to me?”
The most expensive part of a land transaction is often not the purchase price.
It is discovering after payment that the title, identity, authority, use or transferability of the property is not what you believed it to be.
Proper due diligence gives the buyer an opportunity to identify those issues before the money leaves the account.
For individuals, investors and businesses acquiring land in Nigeria, the right legal approach is therefore not simply to document the purchase.
It is to investigate, verify, structure and perfect the transaction.
If you are considering purchasing land, acquiring property for a business or development project, or reviewing a proposed land transaction, appropriate legal due diligence should be undertaken before you become commercially committed.