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23 Jan

PL-PRACTICE WEEK 7 CONTRACT OF SALE AND CONVEYANCING 2

WEEK 7 — CONTRACT OF SALE AND CONVEYANCING 2

CONTENTS

EXPLAIN HOW A VENDOR CAN DEDUCE HIS TITLE: Deducing title means showing that the vendor had the right to convey the property in the way he did. Vendors of land in Lagos do not deduce title-RTL.

By deducing Abstract and Epitome of title. Is done obligatorily by the vendor after exchange of contract or by the lawyer acting for both parties before exchange.

STATE THE PROCEDURE FOR DEDUCING TITLE

  • The vendor shows his abstract or epitome of title to the purchaser’s lawyer, who investigates further by requisitions. by searching the land registry, probate registry, CAC and Court (for lis pendis), tracing traditional devolution (like family or communal property), and Afterwards he will write a search report for the purchaser[1].

The lawyer should ensure the abstract has a good root (like; sale, conquest, succession, adverse possession); that the parties had the power to buy and sell the property[2]; that the land has no encumbrance outside those disclosed in the contract; that all mortgages and charges on the land have been discharged[3].

Abstract is a chronological summary of the property’s transit through previous owners to the current vendor using original documents.

Epitome is a schedule of documents and events showing the vendor’s title to the property and backed by photocopies of the documents.

Abstract and epitome of title are useful in giving a glance of title and assisting investigating lawyer in conducting searches and search reports. It also serves as prima facie evidence of any defect in title.

The Disadvantage being that errors may be made in preparing, it is now faster to photocopy, time is spent against examining the abstract and epitome

The Second Method of Deducing Title: In Idundun v Okumagba the court stated five ways: traditional history; delivery of title documents, positive acts of ownership over time (such as building on the land); long possession and enjoyment of the land; proof of possession of the adjacent or connected land.

INVESTIGATION OF TITLE: Purchaser/his solicitor ascertaining the veracity of vendor’s title.

STATE THE VARIOUS MEANS AND PROCEDURE OF INVESTIGATING TITLE: Through:

– Requisitions: written query to the vendor’s lawyer (to clarify issues that are raised or discovered.

– Search in Land Registries; Which should reveal interest in property, description, charges, encumbrances, court judgments or government acquisitions in respect of the property. Documents needed to investigate title at the land registry: vendor’s consent letter, copy of land certificate (Lagos) or particulars of the land, and statutory declaration of the vendor’s authority. Documents needed to investigate title at the land registry: vendor’s consent letter, copy of land certificate (Lagos) or particulars of the land, and statutory declaration of the vendor’s authority. In other places like Abia, Kaduna and Ogun State, a written application is made to the commissioner of lands indicating the name of the holder, the number of the property, evidence of payment of search fee and completed form. Once permission granted, file is produced from the strong room and given to the solicitor to peruse. It is unethical for solicitors to tamper with the documents in the file. The presence of an official may be necessary to ensure common sense.

– Search in Probate Registry; Where the property is a Wil or other testamentary document. Such search would disclose whether the property is subject of any bequest by Will, intestacy, whether there are beneficiaries and so on.

– Court Registries; To know if property is subject of an ongoing litigation lis pendes.

– CAC; Where a registered company is a party to the sale transaction. To decipher if the company has the capacity and whether due process has been followed (like board resolution).

– Physical inspection of property; visiting the property and inspecting it physically to determine its true nature, occupation status and nature of improvements ,size and general condition of the property.

– Inspecting the documents;

– Investigating traditional title if necessary.

Search in the probate registry is mandatory if a death appears in the abstract.

Search in the CAC is mandatory if a business or company or incorporated trustee is party to the transaction.

Note that title up to 30 and 40 years for West (PCL) and East n North (CA) respectively. (12 years proof of adverse possession) and Abia (30 years)[4]. Statements in a recital up to twenty years old are presumed to be true S.2 Vendor and Purchaser Act, S.70 PCL.

  1. GIVE EXAMPLES OF GOOD ROOT OF TITLE A good root of title should sufficiently describe the property, dispel doubts about its authenticity, transfers both legal and equitable interest, not be subject to a greater interest-Lawson v Ajibulu. E.g. include;

– Registered deed of assignment / Conveyance;

– Deed of Legal Mortgage;

– Assent;

– Deed of Gift;

– Court Vesting Order;

– CofO on State Land;

– Probate? – Note that an equitable mortgage by deed which contains the remedial devices (declaration of trust or power of attorney) can be good root of title. Section 63 CA, Section 88 PCL

EXAMPLES OF BAD ROOT OF TITLE include; – Leases; – License; – Equitable mortgages; – Power of Attorney; – Wills;

– Unregistered Deed of Conveyancing; – Certificate of occupancy (note exception for that granted in respect of state land)-Ude v Nwara

  • SUMMARISE THE COMPLETION PROCEDURE: occurs upon paying balance of purchase price, executing the deed of assignment for the purchaser, handing over original title deeds from vendor to purchaser, purchaser’s actual or constructive possession of property, and vesting of legal estate in purchaser.

The vendor can keep the title deeds if this is endorsed in the deed of assignment using an Acknowledgement for Custody and Production of Documents clause to produce the deeds when the purchaser needs them. Afterwhich a search report is conducted.

Completion is done at the vendor’s place.

 

WHAT CONSTITUTES A COMPLETION STATEMENT? A completion statement is a chronicle of the parties’ financial obligations in the transaction from its earliest stage going forward.

:: MENTION THE PROCEDURE AND DOCUMENTS FOR PERFECTING TITLE TO LAND

A good root of title should date back at least 30 years or 40 years for West and North n East respectively.

:: IDENTIFY ETHICAL ISSUES ARISING FROM INVESTIGATION AND PERFECTION OF TITLE TO LAND

WHEN MAY A VENDOR NOT SURRENDER TITLE DOCUMENTS

PROTECTION OF PURCHASER IN SUCH CIRCUMSTANCE.

Acknowledgement for Custody and Production of Documents clause; – power of attorney; declaration to sell

 

[1] Contents of Search Report: date of search, place of search (usually registry), owner of property, nature of interest, (any) encumbrance, lawyer’s comment.

[2] Sale of land by an infant is voidable.

[3] In practice lawyers who have investigated title still employ the services of a Land Verification Specialist.

[4] The vendor must deduce to the statutorily mandated point and the purchaser cannot enquire past it.

Isochukwu

Quite eccentric really

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