Legality of Government’s Compulsory Acquisition of Land And Payment of Compensation

Legality of Government’s Compulsory Acquisition of Land And Payment of Compensation

By Onyekachi Umah, Esq., LL.M, ACIArb (UK)

It is an inalienable fundamental human right of all persons above 21 years old to acquire and own land in any part of Nigeria (See Section 43 of Constitution of the Federal Republic of Nigeria 1999 (as amended) and Section 7 of the Land Use Act, 1978). On this, a man from Bayelsa State can acquire and own land in Bauchi State while a woman from Cross Rivers State owns land in Lagos State. Even a foreigner can own and acquire land in any part of Nigeria. Since the law reads “persons” it means both Nigerians and Non-Nigerians,juristic and “juridical” beings, human beings and corporate beings, (companies, association, churches, corporations, societies and incorporated trustees). Our constitution went further to state that no movable or immovable (land and developments on it) can be taken compulsorily in any part of Nigeria except in some specified manners and purposes (See, Section 44 of Constitution of the Federal Republic of Nigeria 1999 (as amended)). The referred “specified manners and purposes” will be explained later. All the lands in Nigeria (the 36 states) are vested on the Governors of each state and that of the Federal Capital Territory or any Federal Government ministry, department or agency in any state is on the President of Nigeria (often delegated to his various Ministers). (See, Section 1 and Section 51 subsection 2 of the Land Use Act, 1978). In simple, whatever a Governor can do on land matters, the President of Nigeria or his ministers can do same for lands under their administration. Land is vested on the Governors to hold the land in trust and administer same, for the use and common good and benefit of all Nigerians. Hence, land is not vested on a governor as an individual rather to the office of the Governor. Most governors delegate their powers to use and administer state land to their Commissioners for Land and Survey. Please note that, Federal Government owns the lands in states being used by federal government agencies, departments, corporation, ministries, quarters, estates, commissions and bodies. Dealings over such federal government lands are being administered by the President of Nigeria through his Ministersof the various ministries and not the states’ governors, (see, Section 51 subsection 2 of the Land Use Act, 1978).

On the foundation of the above, it is safe to reiterate that all lands are vested on the governors who give leases to interested persons (Nigerians and Non-Nigerians, human and corporate beings). So, people don’t own land in Nigeria rather have leases (often for a term of 99 years) from the government. Government is the sole landlord/landowner of all lands in Nigeria and grants “Rights of Occupancy” through a “Certificate of Occupancy” to interested persons (human or corporate) by land allocation. Have you ever wonders why no person in Nigeria has a “Certificate of Ownership” of land? Why do people pay rent (ground rent) to government? Why do people need the consent of a Governor to sell, lease, mortgage or sublet land in a state? They are so because people in  Nigeria are tenants to the landlord’s of Nigeria (Federal, state and Local Governments), who issue certificate of occupancy and yearly receipt upon receiving ground rents and equally give consent where necessary in all deals over land.

POWERS OF A GOVERNOR OVER LANDS IN STATE.

Since lands in state are vested on governors, governors have lots of power to exercise in managing and administering the entire land for the benefit of Nigerians. Understanding the powers of a governor over land matters will help us find and identify the limits to their powers (especially as it affects compulsory acquisition and compensation). Below are some of the powers of a governor over land matters:

1.     POWER TO GRANT AND REVOKE RIGHTS OF OCCUPANCY AND EASEMENTS.

As a real owner of lands, a governor has the exclusive right to grant statutory right of occupancy to any person over any part of the state (urban and rural areas) for any purpose whatsoever. A Governor also has powers to grant easement appurtenant, (street ways, avenues etc). The grant of right of occupancy must be for a definite term/period on specified terms and conditions. Most states offer grants for a term of 55 or 99 years after which the right of occupancy reverts back on the government while the former certified occupier may seek for a renewal of term. Please not that Local government Chairmen have rights over lands in the rural area although subject to the exclusive right of governors. Hence, a local government has power to grant any person acustomary rights of occupancy for a defined period of time. (See, Section 5, 6 and 8 of Land Use Act, 1978).Most grants of right of occupancy are for a rent; the occupiers are expected to pay yearly rent to government. Please note that the governor has powers to grant right of occupancy free of rent or at a reduced rent where that will be in the interest of the public, (see Section 17 of the Land Use Act, 1978).

A governor equally has powers to revoke grants of rights of occupancy madeby him or his predecessors.Failure to observe terms and condition of a grant,failure to pay rent, or the use of land against its specified purposes or the need of land by government for over-riding public interest are all possible grounds for revocation of grant. (See, Sections 28 and 38 of the Land Use Act, 1978)

2.     POWER TO ISSUE CERTIFICATE OF OCCUPANCY

As stated above, governors are land owners while the other persons in a state are “land occupiers” (tenants to government). Land occupiers have exclusive right and possession over their lands against any other person whatsoever. To identify, announce and authenticate, the occupancy of any person (human and corporate) the state government will issue Statutory Right of occupancy over lands both in urban and rural areas. A certificate of occupancy contains a clear description of the land in question, details of the occupier, the details government, duration of the approved occupancy, rent to be paid yearly and the purpose of the land (ie, whether it is for residential or commercial, industrial or agriculture). Hence, it is justifiable to state, that a certificate of occupancy is an abridged lease agreement between government and a person over a specified land. It contains the terms and conditions which any occupier undertakes and must observe to continue his occupation at the pleasure of government. (See, Sections 8 and 10 of the Land Use Act, 1978)

Upon granting of a right of occupancy or an application by an occupier of a customary right of occupancy to his state government, a certificate of occupancy shall be issued to such person upon his payment of appropriate fees. Certificate of occupancy is a prima facia evidence of possession of land. Upon the issuance of a certificate of occupancy to any person, such a person has a better and higher title above and beyond any other person; (See, Section 9 of the Land Use Act, 1978).  Apart from government, a certificate of occupancy negates and invalidates the rights, powers and privileges of other persons over a land including the indigenes of such land. (See, Section 5 Sub-Section 2 of the Land Use Act, 1978)

3.     POWER TO ENTER AND INSPECT

Just like any true landlord will do, a governor (including any public officer duly authorised by the governor) has the power to enter upon any land in the state. Such inspection is to ensure strict observance of the terms and conditions of the occupation which the tenant undertook to observe at all times. Such inspection ensures that no industrial plant is erected in a residential area or a residential house in a commercial zone and avoids the erection of unapproved structures. It is upon this power and other laws that the agents of Ministries of land, environment and other public office holders rest on to enter and inspect people’s property.

Please note that such entry and inspection must be done during the day time. The occupier of such land is expected by the law to permit and give free access to the governor and the public officers (see Section 11 of the Land Use Act, 1978).

4.     POWER TO GRANT AND CANCEL LICENSES

Being the exclusive owner of all lands in a state, a governor has powers to grant licenses to any person(s) to enter upon any land to which no one has a statutory right of occupancy to, or mining lease, to remove/extract stone, clay, sand, gravel and other building materials from such land. A governor cannot grant such license over an area exceeding 400 hectares. A governor issues such license for a specified period of time and upon specified terms and conditions. A governor equally has power to cancel licenses wherein the licensee (person(s) granted license) fails to observe the terms and condition of his license, (see Section 12 of the Land Use Act, 1978).

5.     POWER TO CONSENT AND REJECT LAND TRANSACTIONS

In the eyes of law, the landlords of the lands across the 36 states of Nigeria are the respective governors of the states of the federation of Nigeria. They are vested with the lands, to administer and manage them for the good of all, hence they decide who to “lease” such lands to, who further gets a “sub-lease” and “sub-underlease”. A governor of a state is the only person (whether in person or through his commissioners and others agents) that can consent or reject the sale, assignment, sublet, transfer, mortgage and change of ownership of any land in the state. Any of the above transactions ever done without an express and written consent of the governor of the states wherein the land is located is illegal and null. It is expected that, the land agreements/instruments (deed of sale, deed of mortgage, deed of gift, deed of assignments, deed of transfer and registerablePower of Attorney, etc. ) are sent to the concerned Governor (Commissioner for Land) to peruse, consent or reject land transaction. Consent of a governor must be in writing and often on land agreement itself. (See, sections 21, 22, 23 and 26 of the Land Use Act, 1978)  Even after payment of money, taking of possession of land and building on same, a land transaction is not complete until governor consents to such land transaction. To be on the safe side, in my law practise I protect the interest of my land purchasing clients by inserting a “Rectification Clause” in their land agreements/instruments. A Rectification Clause is an undertaking by a land seller to a land buyer that he the seller will repay and indemnify the buyer all his money and costs if governor fails to consent to their land transaction.

May I quickly correct a wrong practise I have observed; land agreements (deeds of sale, assignment, purchase, transfer, mortgage, gift and power of attorney etc) do not need or require the stamps and signatures of Court staff (Commissioners of Oath, Court Clerk and Registrars etc). Such stamps and signatures are useless and enrich court officers who don’t remit such fund to government. Do not be deceived the Consent, signature and stamp of a Governor or his Commissioner for lands are not same with those of a mere court staff referred above. Many people have suffered from the above deceit, consult a good lawyer. No doubt, in special cases the name, address and signature of aNotary Public or a Commissioner of Oathwith date are expected on a land agreement ONLY where a party (buyer or seller)is an illiterate, in view of a Jurat. Please, further note that consent of a governor is not needed over land transactions done through court sales (like public auction done by an order of court).

6.     POWER TO DEMAND AND SUE FOR RENT

Like every other lease agreement, a Governor being the “LEASOR” (person to grantlease) expect rent from his “LEASEE” (person to whom lease is granted). All persons having rights of occupancy are expected to pay rent as at when due subject to the terms and conditions evidenced on their certificates of occupancy. Right of occupancy can be revoked by a governor where a holder of right of occupancy fails to pay his rent as at when due (See, Sections 28 and 38 of the Land Use Act, 1978).

To recover rent, a Governor through and in the name of his Chief Land officer (Commissioner for land) or any of his appointees can institute a legal action in a magistrate Court of competent jurisdiction, (See, Section 42 of the Land Use Act, 1978). Owing to the immunity of governors from being sued or suing both in civil and criminal proceedings, they cannot sue for such recovery themselves, (See, Section 308 of the Constitution of the Federal Republic of Nigeria 1999 (as amended)).

7.     POWER TO COMPULSORILY ACQUIRE LAND, DEMOLISH/CONVERT PROPERTY AND TAKE OVER LAND. 

Yes, it is part of our constitutional rights to own and use land and landed property in any part of Nigeria irrespective of our tribes, colour, birth, religion, political parties  and height(See Sections 42 and  43 of Constitution of the Federal Republic of Nigeria 1999 (as amended)).The constitution went further to assure all persons that no property shall becompulsorily  taken possession of or acquired compulsorily except in the manner and for the purpose prescribed by a law, (See Section 44 of Constitution of the Federal Republic of Nigeria 1999 (as amended).  The Land Use Act of 1978 is one of the laws that in line with the constitution, provides “the manner and the purpose” for compulsory acquisition of land and property thereon. Consequently, by the joint provisions of the Constitution and Land Use Act, lands and the property on them can be acquired compulsorily by government provided that certain manner and procedures are adhered to and for certain reasons. Please note that government MUST observe the set down manners and purpose for a compulsory acquisition of land before such acquisition can be valid. We procedures were not observed; such act can be challenged in a court of law, for not even the government is above the law. The set down manner and purpose are explained below.

LEGAL GROUNDS AND MEANS OF COMPULSORY ACQUISITION OF LAND BY GOVERNMENT

As shown above, it is your right to own land in any part of Nigeria and be equally protected from compulsory acquisition of such by government. Although for specific purposes and in given manner government has powers to compulsorily acquire any land. Note that none observance of the legal grounds and means for compulsory acquisition of land by government, invalidates such compulsory acquisition.  Below are the special cases under which government can exercise such powers;

1.     LEGAL GROUND FOR COMPULSORY ACQUISITION OF LAND

“Overriding public interest” is the sole and only purpose under the Land Use Act 1978 upon which a governor can compulsorily acquire the land of any person. “Overriding public interest” arises where;(1.)a statutory right of occupancy holder sells, mortgages, transfers or alienates his title without a prior consent of governor as demanded by the law or (2.) there is a requirement of land by Federal Government or State Government or even Local Government for a “Public Purposes” in the federation or state respectively (See, Section 28 of the Land Use Act, 1978). With reference to the provisions of Section 51 subsection 1 paragraphs (a) to(h)of the land Use Act, 1978, “Public Purposes” include things that are: forexclusive government use or general use; for use by government companies, corporations, ministries, departments and agencies; for sanitation of environment, urban or rural planning and development; for mining, oil pipelines purposes and extraction of building materials; for economic, industrial or agricultural developments and for construction of railways, road or other public works undertaken or provided by government. Please note that the “extraction of building materials” is a “public purpose” for compulsory acquisition of lands under customary right of occupancy, only.  Unfortunately, the interpretation of the words “Public purpose” is too wide that many undemocratic governors have hibernated under them to wind-up businesses of their opponents and enrich their own personal businesses. Under the two vague words, a governor can compulsorily acquire someone’s gigantic cement company and turn it into swimming pool and bar while he turns a privately owned university into his hotel. Note that a governor needs not give any further reasons or report for his compulsory acquisition to any person or thing; once he tags it for “overriding public interest”.

In the light of Section 44 of Constitution of the Federal Republic of Nigeria 1999 (as amended) the other grounds among which land/property can be compulsorily acquired are:a) where there is prompt payment of compensation on such land/property b) where the holder of right of occupancy of such compulsorily  acquired property is afforded right of access for determination of his interest and compensation in a court of law c) where land/property is in a dangerous state or injurious to the health of human beings, plants or animals d) where land/property relates to enemy of state e) where it is for execution of court judgement or f) for imposition of tax, rate or duty etc.

2.     LEGAL MEANS OF  COMPULSORY ACQUISITION OF LAND

Once the need for a compulsory land acquisition is for overriding public interest, the means is simple and easy. Where Governor wants to compulsorily acquire land, the governor (or through his staff) is to issue a “NOTICE” to the holder of the right of occupancy of the desired land. The Notice must declare that the land is required by the government for public purpose. At the issuance of such notice the right of occupancy will be revoked. Once such is done, the governor has compulsorily acquired the land. There cannot be a valid compulsory acquisition of land without a “Notice” to the holder of the right of occupancy, (See, Section 28 sub section 4 of the Land Use Act, 1978).

COMPENSATION FOR COMPULSORY ACQUISITION OF LAND 

If you lend a car to a friend for a specified period of time but you suddenly need the car after your friend had filled its fuel tank; you may pay your friend for his unexhausted petrol. You will not pay for your car but for the petrol. This is what happens in compulsory land acquisition for public interest and payment of compensation. The lands are vested on the governors of states, who sub-lease same to people who in turn pay annual ground rent to them. Where in a governor wants to compulsorily take back (acquire) land, the Governor need not pay anything to any person for the land. Rather the governor MUST pay for the improvements, developments, structures and expenditures on such land. Compensation is for legally acquired lands and not fake or unapproved land tiles; you cannot benefit from your own illegality. So, note that government does not compensate for land rather for the unexhausted improvements/developments on lands legally and duly acquired by its holders/occupiers. Where a compulsorily acquired land is just a bare land no compensation can be paid. Land is and will always be that of government while the improvements on land are yours and entitles you to compensation.  Hear me very well, no matter the length, width and largeness of your land, no government will compensate you unless there is an improvement/developmenton your land. (See, Section 29 of the Land Use Act, 1978).Improvements “means anything of any quality permanently attached to the land, directly  resulting from the expenditure of capital or labour by an occupier or any person acting on his behalf, and increasing the productive capacity, the utility or the amenity thereof and includes buildings”, (See, Section 51 of the Land Use Act, 1978). Improvement/ expenditures includes;building, installation (mechanical apparatus), amount of the replacement cost of the building, crops on land, plantations of long lived crops or trees, fencing, wells, roads and irrigation or reclamations works, but does not include the result of ordinary cultivation other than growing produce.

Government does not just pay for improvements/development made on land rather for the value of the unexhaustedimprovements. It means that government will consider “Depreciation” (wear and tear) on the improvements while calculating compensation to be paid. So, government will pay you for the unexpired, unfinished, unexhausted part or value of your improvements. Well, government employs professional valuers to access the value/worth of improvements to be paid and interest therein. Government will pay interest on delayed compensation at the prevailing bank rate placed by Central Bank of Nigeria. Documentary evidence (receipts, invoices, bills and quotations) is welcomed to aid in assessment of payable compensation.(See, Section 29 subsection 4 of the Land Use Act, 1978)

Where residential buildings were erected on a compulsorily acquired land, government may offer residential building(s)/settlement in another area as a reasonable alternative accommodation to the affected persons in place of monetary compensation. If the value of the new settlement is higher than the compensation government would have paid, such excess/extra in value will be considered as loan to the persons, which they must pay to government.Anyone who takes government’s settlement/residential building (reasonable alternative accommodation) cannot seek for monetary compensation; his right has been waived, (See, Section 33 of the Land Use Act, 1978).  Where compensation is payable as shown above, it shall be paid to the holder of the right of occupancy. Where the land in question is owned by a community, Governor may direct compensation to be paid to the community or to the chief/traditional ruler of the community or into a fund set aside by the Governor for the benefit of the community. (See, Section 29 subsection 3 of the Land Use Act, 1978).

Where one is not paid his compensation at all or has any challenge concerning the rightful persons to be paid compensation, he can seek redress in a State High Court only and not a customary court, area or magistrate court. (See, Section 39 of the Land Use Act, 1978). Please it is very important to note that NO court in Nigeria has powers and jurisdiction to entertain and deliberate over a case concerning the amount or adequacy of any compensation paid or even to be paid. (See, Section 47 subsection 2 of the Land Use Act, 1978). Hence, you cannot approach a court to challenge the amount paid to you by government as a compensation for your improvements on a land but you can approach a court to determine persons entitled to compensation. No matter how harsh it may appear, it is our law until same is amended by the National Assembly.

As seen above, government can compulsorily acquire any land but must do so cautiously within the confines of law and procedure. Government MUST pay compensation or provide an alternative accommodation where there are unexhausted improvements/developments on a compulsorily acquired land. Where government is reluctant or fails to compensate, the persons concerned have legal remedy in the State High Court.

Thank you.