Governor's Consent: The Step Most Lagos Buyers Postpone and Later Regret

# Governor's Consent: The Step Most Lagos Buyers Postpone and Later Regret

Ask a Lagos buyer whether they own their property and they will point to a deed of assignment and a receipt. Ask whether consent has been obtained and the answer is frequently that it is being processed, that it will be handled when they are ready to sell, or that the seller said it was not necessary.

Consent is the step that converts a private agreement into a title the state recognises. Leaving it undone does not simply delay a formality. It leaves the buyer in a materially weaker position than they believe they occupy.

## Where the requirement comes from

The Land Use Act vests land in each state in the Governor, to be held in trust and administered for the use and common benefit of all Nigerians. What a private party holds is a right of occupancy rather than absolute ownership in the older sense.

Because the underlying interest is a right of occupancy granted by the state, the Act requires the Governor's consent before that right is alienated, whether by assignment, mortgage, transfer of possession or sublease. The consent requirement is not an administrative preference. It is built into the structure of how land is held in Nigeria.

The consequence of alienating without consent has been litigated extensively, and the formulation has shifted across the authorities. What is not in dispute is the practical position: a transaction without consent is exposed in a way that a consented transaction is not.

## What buyers assume, and what is actually true

**Assumption: possession is what matters.** Physical possession is useful evidence and it is not title. A buyer in possession under an unconsented assignment can still face a challenge they are not well placed to answer.

**Assumption: consent can be obtained at any time.** Consent can usually be applied for later, but the practical difficulty increases with time. The application typically requires the cooperation of the assignor. If the seller has relocated, lost interest, died, or simply decided to be difficult, the buyer discovers that the document they need signed is not within their control.

**Assumption: it is only relevant when selling.** It becomes visible when selling, which is different from becoming relevant then. It is relevant from the day of the transaction. Any bank considering the property as security will look for it. Any serious buyer's solicitor will raise it. Any competing claimant's counsel will notice its absence immediately.

**Assumption: the cost is prohibitive.** Perfection carries government charges including consent fees, capital gains tax, stamp duty and registration fees, and those charges are real. They are also a known, calculable percentage of value that can be built into the transaction from the outset. The alternative is an unknown, uncapped exposure. Rates and computation methods change, so current figures should be confirmed at the point of transaction rather than assumed from a previous deal.

## Perfection in practice

Perfection of title in Lagos generally involves three components, and buyers often use the word to mean only the first.

**Consent.** The application to the Governor, through the relevant state office, for approval of the alienation.

**Stamping.** Assessment and payment of stamp duty on the instrument. An unstamped instrument has limited evidential value.

**Registration.** Registration of the instrument at the Lands Registry so that the transaction appears on the public record. Registration is what protects the buyer against a later purchaser who registers first.

All three matter. A consented but unregistered transaction still leaves a gap. A registered but unconsented one has a different problem. The objective is to complete the set.

## Structuring the transaction so consent actually happens

The most effective time to address consent is before payment, not after.

**Allocate the obligation in writing.** The deed should state clearly who applies for consent, who bears the government charges, and within what timeframe. Silence in the document becomes a dispute later.

**Retain leverage.** Where the commercial position allows, hold back a portion of the purchase price against the seller's cooperation in obtaining consent. A seller who has been paid in full has limited incentive to attend to paperwork.

**Take a power of attorney.** An irrevocable power of attorney granted by the seller, properly drafted, reduces dependence on the seller's continued availability. This is a supplement to consent rather than a substitute for it, and buyers who treat a power of attorney as an alternative to perfection have misunderstood what it does.

**Collect the underlying documents at closing.** Original title documents, the seller's identification, tax records where relevant and any corporate authorisations should be gathered while the seller is engaged and motivated, not months afterwards.

**Set a timetable and keep it.** Applications drift because nobody owns the deadline. Assign responsibility to a named person with a date attached.

## When the seller is a company, a family or an estate

Consent applications are more complex where the seller is not a straightforward individual holder.

For **companies**, board resolutions and corporate authorisations are typically required, and the company's records must support the authority of whoever executes.

For **families**, the concurrence of the head of family and principal members generally needs to be established, and the documentation should reflect that concurrence rather than assert it.

For **estates**, letters of administration or probate will usually be needed, and the personal representatives must be the ones dealing.

Each of these adds time. Buyers who budget a few weeks for consent in these circumstances are usually budgeting optimistically.

## The commercial case, stated plainly

An unperfected property is worth less than a perfected one, and the discount is not always visible until you try to realise value.

You cannot readily mortgage it. You will struggle to sell it to a sophisticated buyer without either perfecting it first or accepting a price reduction. You are exposed to competing claims. And you carry a contingent liability of unknown size that becomes due at the least convenient moment.

Perfection converts an uncertain liability into a known cost. That trade is almost always worth making, and it is cheapest at the point of purchase.

## A note for sellers

Sellers benefit from perfection as much as buyers do. A perfected title sells faster, attracts institutional buyers, supports a higher price and reduces the risk of the transaction collapsing during due diligence. Sellers holding unperfected title should treat perfection as pre-sale preparation rather than as the buyer's problem.

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*Aston Bernice Attorneys handles perfection of title, consent applications and property documentation for buyers, sellers and lenders in Lagos. This article is general information and not legal advice on any specific transaction. The treatment of unconsented alienation has been considered in a number of Nigerian authorities and specific advice should be taken on any live matter.*

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