II. CHAPTER TWO: THE HISTORICAL BACKGROUD OF TITLE AND POSSESSION
2.4 Pitfalls of the Customary Tenure System and the Land Use Act 1978 on Secured
As seen already, individual land holding was generally detested by the community but there is some evidence to show that there were situations where individuals exerted significant control over property by tilling and farming, and as such, they were granted title rights.54Individual tenure could be granted in a labourer’s favour, although the circumstances in which this happened could vary considerably according to each community. It was problematic to identify whether an individual could actually own land under customary law. Also, before land could be alienated either by way of security or outrightly, consensual authority must be actualised either through the head of the family or the king of the clan which perhaps marked the problematic issues on inalienability of land associated with the customary land tenure system in Nigeria.55
Unlike personal property which can be outrightly transferred with less cumbersome legal procedures, this was not the case with customary land. Before land could be assigned, the family members were usually in agreement before such transactions could be effective. With the level of hostility shown by customary law towards land alienation, this may have been primarily responsible for the uncoordinated nature of secured transactions law in Nigeria, which often leads to the high cost of obtaining credit due to excessively high interest rates on those who wish to rely of land as collateral for loan. The nuances of customary law on land could never adequately ascertain the viability of land title rights being held by group of people, in that there remained the danger of it being challenged or set aside altogether. The consequence of not acquiring the requisite consent was capable of rendering the whole transaction void.56
The interference of English law in the traditional land system caused certain difficulties because to convert title in land between the two systems was not without
53 (1931) 3 AR 596.
54 Robert Mc C Netting, Hill Farmers of Nigeria: Cultural Ecology of the Kofyar of the Jos Plateau (University
of Washington Press 1968) 167-168.
55 Taslim O Elias, Nigerian Land Law and Custom (Routledge & Kegan Paul Ltd., London 1962) 172. 56Sanusi v Daniel (1956) 1 FSC 93, 95.
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problems for the conveyancers.57 It took several years before this problem could be minimised to a satisfactory level. First, the Land Use Decree (now Act) was enacted to unify the land use system that was already being practised in Nigeria. The use of land was rather complicated and there was no legislation to govern all lands in Nigeria common to both the northern and southern region.58 One of the major problems inherent in the former system had to do with the problem of rapid urbanisation. After Nigeria gained independence in 1960, the economic status of citizens changed rapidly and the influx of job opportunities in the urban areas changed the developmental pattern of growth and migration. Structural changes were visible due to the urban population growth and with this sudden increase, local authorities and land administrators were under pressure to provide housing, improvement of environmental sanitation, and educational infrastructures.
Land officials and local government land administrators were not trustworthy as they made excessive profit from the exorbitant prices placed on urban land acquisition. Other land owners kept purchasing land they did not intend to develop and resell at a highly unregulated price value.59 Those without a high level of income were affected because of the exorbitant land prices fixed by the racketeers. Only the financially privileged or elites could get grants to urban lands as a result. Sometimes, in extreme cases, violence ensued through self-help when extorted citizens looked to secure their interest in land, while sometimes the courts were left with no particular remedy to secure the interest of the defrauded, as evidenced in Ogunbambi v. Abowab, 60 per Verity J.
‘The case is indeed in this respect like many which come before the court: one in which the Oloto family either by inadvertence or design, sell or purport to sell the same piece of land at different times to different persons. It passes my comprehension how in these days, when such disputes have come before this court over and over again, any person will purchase land from this family without the most careful investigation, for more often than not they purchase a law suit and very often that is all they get.’61
The discovery of petroleum in different parts of the country and the income generated from it kept increasing annually. Both the state and federal government saw the need to carry out mass developmental projects. This resulted for the need to acquire more lands for these projects.
57Balogun v. Balogun (1943) 9 WACA 78; Oshodi v. Balogun (1936) 4 WACA 1.
58 The diversity of customary laws on land tenure was difficult in its application due to lack of comprehensive
legislation.
59 This practice was more prevalent in the south where fraudulent sale was even in practice. Sometimes, land
may be sold to different persons at the same time which gave rise to a multiplicity of court actions which could last many years such as in Ariori & Others v Muraimo & Others (1983) 1 Sup Ct Nig L Rep. 1, where the action commenced in in October 1960 but a re-trial was ordered by the Supreme Court in 1983.
60 (1951) 13 WACA 222. 61 ibid, 223.
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The military government in the 1970s was not totally satisfied with the decentralised nature of land tenure system in the country. It did not reflect a good sense of national unity, which the country needed. The government found a remedy in a law to regulate and vest land management and control of all the lands in Nigeria in the government, thereby neutralising the powers which the traditional authorities had over customary lands. The government was to become the sole allocating authority over all lands situated in Nigeria both north and south.
2.4.1 Problems with the Land Use Act 1978
The then military administration set up an eleven-man panel to study the land tenure situation in Nigeria.62 It was set-up to undertake an internal study of land use and conservation practice in Nigeria, to study and analyse the merits and the demerits of a unified land policy, to examine steps in the reform and development of future land use for the government and entire populace in both urban and rural areas and to make appropriate recommendations on these matters.63The main objectives are clearly stated in the preamble and text of the Land Use Act (LUA),64 which came into force on 29 March 1978. Some of the objectives included, inter alia, the acquisition of lands situated in Nigeria for the federal, state and local government to be vested in the state governor, thus avoiding the situation of land being solely concentrated in the hands of a few by placing a limit of a half-hectare for alienations in urban areas, thereby eliminating the increase in litigation concerning matters of mortgage, charges, etc., by making it necessary for an alienator to obtain the consent of the governor first before such transaction could be lawful.65 Other objectives of the Act were to limit the powers of traditional rulers over land alienation and, at the same time, weaken their traditional powers and status in respect to land. It was also seen as a means of promoting development by laying down terms of usage for a landholder. The Government now had the right to execute projects on undeveloped land without paying excessive compensation for such lands which were not yet acquired by the government prior to 1978.66
62 The panel was named the ‘Land Use Panel’ under the chairmanship of the late Justice Chike Idigbe, set-up
on 26 May 1977.
63 Report of the Land Use Panel 5 (1977).
64 Land Use Act, Cap. L5, Laws of the Federation of Nigeria (LFN) 2004. Formerly called the Land Use
Decree, No. 6, 1978, this has been redesigned as an ‘Act’ pursuant to the Adaptation of Laws Order, 1980. The content of both laws however remains largely the same.
65 Idrisu (n 5) 86. 66 ibid, 87.
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The LUA was promulgated by the military regime in Nigeria and it is the most comprehensive land law which applies uniformly to all states within its territory. 67 Section 1 LUA vests all lands comprised in the territory of each defined state of Nigeria in the governor of that State, with the lands being held in trust and administered for the use and general benefit of all Nigerian citizens in accordance with the provisions of the Act, subject to occasional review.68 In rural areas, land is held by the local government authorities while the governor is saddled with the responsibility of administering lands in urban areas.69 The governor and local government authority have the power to grant a certificate of occupancy to evidence the alienation of rights.70 The nature of a right of occupancy is not clearly stated in the Act, but it seems to be of a usufructuary nature with a tenure not normally lasting for more than ninety-nine years in leasehold as against absolute fee simple where land could be owned indefinitely.71 It therefore means that no individual has absolute proprietary interest over any land, because all lands are held for a term of years determined by the government.
There is a conceptual problem with regards to the word ‘trust’ as seen in section 1. It is questionable whether the meaning of the ‘trust’ is used in a loose sense or if it involves legal connotations. However, it was established that the governor is an equitable trustee which will make the governor liable to account for the management of lands on behalf of beneficiaries.72 Unfortunately, this power is open to political abuse where the governor can confirm certificates to only a selected few who require land in important strategic locations. Suffice to say, this scope remains unclear because legal titles being held prior to the promulgation of the LUA continues to vest on their title owners without being subject to the governors’ legislative powers, although the consent of the governor will be required if the land will be alienated.73
The certificate of occupancy which is issued by the governor is not a registrable document because it merely evidences a transfer which does not involve a transfer of interest
67 The Federal Republic of Nigeria was under the military leadership of Major-General Olusegun Obasanjo
who ruled from January 16, 1976 to October 1, 1979 during which the Land Use Decree was promulgated. It was re-designated an ‘Act’ by the Adaptation of Laws Order, 1980.
68 LUA s 1, Pursuant to s 49, land vested in the federal government or any of its controlling agencies is exempt
from this declaration.
69 LUA s 2 (1) (a), (b).
70 The Governor is empowered to grant a Statutory Right of Occupancy to all persons seeking interests in land
in urban and rural areas, while under section 6 the Local Government has the right to grant only Customary Right of Occupancy over land in non-urban areas, LUA s 5.
71Okubule & Anor v Oyabgola & Ors [1990] SC 187.
72 This form of arrangement was regarded as a trusteeship in a loose sense, see Kinloch v Secretary of State for India (1882) 7 App Cas 619, 625 – 626.
73Savannah Bank Ltd v Ajilo (1989) 1 NWLR (Pt. 97) 305; see Oladipo O. Sholanke, ‘Is the Grant of
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in land. The only document of transfer is this certificate issued by the governor and nothing more, thus making it a fragile and defeasible document with little worth. 74 Under sections 21 – 23, alienation whether through a charge or mortgage without the approval of the governor or local authority where appropriate may be declared null and void. The Act does not provide for how a mortgage shall be created but rather preserved the already existing laws subject to necessary modification to be in tandem with the Act.75 However, equitable assignments in land such as those transferred by way of equitable charge would not require the consent of the governor. This is of little relevance because secured transactions are usually drafted in such a way as to reimburse the lender by foreclosing or selling the collateral if the borrower defaults, but since this is not possible without the consent of the governor if the collateral involves land, no interest can pass validly without permission. In a nutshell, the LUA has played a fundamental role in curbing fraudulent land transactions, but it has stifled economic growth and development since the use of land as security cannot be totally relied on by contracting parties. As stated by Justice Nnamani:
Aspects of the Act which has brought untold hardship include the provisions relating to the issue of certificate and grant of consent to alienate. Both can take years and the applicant is subject to the vagaries of bureaucratic action which demand survey plans, interminable fees, documents and a lot of to and froing. These cumbersome procedures have adversely affected economic and business activity and make industrial take off a matter very much in the future.76