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21 Jan

THE DIFFERENT WAYS TO SELL LAND IN NIGERIA

There are three main kinds of contracts for selling land. They’re:

  1. ORAL CONTRACT:

Under native law, this is a common way to get a piece of land. But it goes against section 4 of the Statute of Frauds from 1677 and other similar laws, which say that contracts for the sale of land must include a memorandum or some other written note, or the contract will not be enforceable.

Even though these contracts can’t be enforced, they are not invalid. But if there is enough proof that part of the job was done, equity will order specific performance. But because specific performance is a choice, it is risky for a purchaser to rely on the doctrine of part performance to enforce a contract to sell land.

When equity steps in to order specific performance, it does so to help the plaintiff if the defendant helped him do part of the contract and to stop the defendant from claiming that the contract wasn’t written down.

The court said this in International Textile Industries Nigeria Ltd. v. Aderemi:

“The reason the courts say that part performance takes a contract out of the Statute of Frauds is that when one of the two contracting parties has been induced or allowed by the other to change his position on the faith of the contract, such as by taking possession of land and spending money on the building or other similar acts, it would be fraud for the other party to claim the legal invalidity of the contract on the faith of which he induced or allowed the first party to change his position”.

So, here are some specific ways the courts can enforce a contract based on part performance:

  • There are good reasons to believe that the terms of the oral contract are true.
  • The contract must be enforceable in a specific way, which means it can’t be a contract for personal service.
  • The act that is considered part performance must be clear and related to the contract that is said to have been broken.
  • The plaintiff has relied on the oral agreement, either in whole or in part, with the expectation that the defendant would do the same.

In Mohammed v. Klargester Nigeria Ltd. (2002) FWLR (Pt. 127) 1087 at 1095, it was said that a claim for specific performance cannot be granted if the vendor sold a family property that was jointly inherited and owned with other people. This is because a court can’t force a person to do something that he can’t do.

But if a community’s native law and customs govern the sale of land, it may be possible to do so over the phone and a written document may not be needed. The bare minimum for an oral contract is –

1. Payment of the cost to buy;

2. Taking ownership by the purchaser; and

3. Adedeji v. Oloso (2007) All FWLR (Pt. 356) 610 at 640; Ogunmuyiwa v. Odukoya (2009) All FWLR (Pt. 454) 1526.

  • OPEN CONTRACT:

A contract that only meets the minimum requirements of the Statute of Frauds is called an open contract. It

  • Clearly explains what the property is.
  • Makes it clear who’s who.
  • Specifies the cost. In Jodi v. Salami (2009), All FWLR (Pt. 458) 385, the court said that land can never be sold on credit. Even if someone is in possession of the land, the sale can’t happen until the purchase price is paid.

An open contract is not made over the phone. Instead, it is written down in a note or memorandum that has the basic terms of a land sale contract. It is called an “open contract” because all the other important terms and conditions that make a contract for the sale of land work are implied by statutes, common law, equity, and conveyancing practice and custom. For example, it is implied that the vendor must show a good title within a reasonable amount of time and sign a conveyance to the purchaser once the purchase price has been paid.

In an open contract, section 70 of the PCL and section 1 of the Vendor and Purchaser Act make it clear that the vendor must prove his ownership for 30 years and 40 years, respectively.

A vendor can act as a trustee, family head, administrator/personal representative of an estate, mortgagee, beneficial owner, etc. Six (six) covenants are implied by law when a vendor sells as the beneficial owner in exchange for money. This is –

  • The right way to say
  • Quiet enjoyment.
  • Freedom from encumbrances.
  • Even more promises (that is, the vendor ensures the purchaser that he will do everything to obtain the Legal title of land in question).
  • That the lease is still in effect.
  • That the rent has been paid and the lease’s requirements have been met.
  • FORMAL CONTRACT:

Formal contracts are a detailed agreement to sell land that includes more than just the parties, the property, and the price. They also spell out other agreed-upon terms. So, it spells out what each party can and can’t do. It is split into two parts, which are:

  • The details of the sale include information about the property, like what it is, how big it is, if there are any problems with it, and what benefits, costs, and responsibilities it has.
  • Terrance v. Bolton (1872) LR EQ 124. The terms of the sale that deal with the terms of the contract and the terms by which the parties are bound.

The contract doesn’t have to be made in a certain way, as long as both parties want to make a legally binding agreement and agree on the most important terms in exchange for something of value. The contract doesn’t have to be written down, but if it is, that’s fine. – Re Holland (1902) 2 Ch. 360, the person who wants to be bound by the note or memo must sign it. This is done to stop fraud and perjury, and so that a contract for the sale of land can’t be based on the words of witnesses who might be lying. The goal of the law is to stop anyone from taking action unless the person being sued has signed a paper with the terms of the contract. The equitable doctrine of part performance was a way for justice to step in and make an exception to what the law said had to be done.

ADVANTAGES OF AN OFFICIAL CONTRACT

1. Before signing the deed of conveyance, the purchaser has more time to look into the title being transferred. This gives the purchaser a chance to protect himself.

2. Yusuf v. Dada (1990) 4 NWLR (Pt. 146) 657 says that the contract doesn’t end when one of the parties dies because their personal representatives can continue with the transaction and finish the sale.

3. No one can back out of the deal at the last minute without breaking the terms of the deal and having to pay for it.

4. Since both parties agreed to the terms of the contract, their positions and rights are clear and not based on assumptions, which could make their positions unclear.

5. Fixtures and fittings can be moved with a formal contract, but they don’t have to be written into the land’s deed of conveyance.

6. Since the purchase price is already written into the contract, the vendor can’t decide on his or her own to raise it later.

7. Parties can get special benefits from the contract if it lets them do things they might not be able to do otherwise.

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