Certificate of Occupancy: Meaning & All You Need To Know

Malcolm Omirhobo

The C of O serves as the most important document in any property transaction in Nigeria. The only authority that can issue the Certificate of Occupancy (C of O) is the state government in Nigeria and its issuance evidences that you own the land or property in question. As such, it is advisable that beforepurchasing a property you should always ask if such property has a certificate of occupancy. Property purchased without certificate of occupancy is an incomplete transaction.

Owing to the difficulty in getting Certificate of Occupancy (C of O) in many states of the federation, a good number of property owners don’t bother about the document, SILVER NWOKORO reports.

Getting a Certificate of Occupancy for my property wasn’t easy at all. I spent a lot of money to acquire it, and I spent more than the money I used to purchase the land. It wasn’t a smooth process for me. I was told then to do ratification, that with it, it will be free from government acquisition because it is close to the expressway.”

The above statement from Mr Philip Ogu, a retired construction worker who lived and worked in Lagos all his life, aptly captures the disconcerting stress property owners go through to regularise their land ownership.

Mr Ogu had procured and built his house close to an expressway while in service. However, on getting a hint that the street on which he built his house would be asphalted, he immediately proceeded to process a Certificate of Occupancy (C of O) on the property. This meant enormous challenges.

The story of Mr. Ogu is symptomatic of the ugly experiences of many Nigerians who have found it difficult to acquire that important piece of document.

Getting C of O has been a major challenge to many house and land owners. Little wonder why quite a number of houses exist without valid documents. While many property owners jettison the idea of sourcing documentation for their cherished possession, some others, who braved the odds, often fall victim to fraudsters who capitalise on the red-tapism injected into the process by corrupt government officials as well as the desperation of hapless property owners to fleece them of their hard-earned resources.

That C of O is an important piece of document in Nigeria is stating the obvious. Aside from the fact that it serves as proof of ownership of a property, it is also often requested in a number of legal transactions involving a particular property.

No government can compulsorily acquire, demolish or take over any property in any part of Nigeria without adequate compensation except in instances where such property is injurious to others, illegally acquired or contravenes relevant laws of the country or state.

Obtaining a C of O in Nigeria confers on the beneficiary a sense of security, not to mention access to numerous benefits and opportunities. The legal framework for the issuance and administration of C of O in Nigeria is governed by the Land Use Act of 1978, which on being issued, serves as proof of ownership for a specific period as granted by the state government or the Federal Capital Territory (FCT), as the case may be.

A C of O also provides the holder with legal protection against any dispute or claim on the property. It makes access to loans seamless as banks and other financial institutions require it as collateral for granting loans.

According to Section 9 of the Land Use Act of 1978, the Governor of a state in Nigeria is the custodian of all land in his/her state and exercises the authority to issue a Certificate of Occupancy. This Act introduced the notion of land use either in a residential, commercial or mixed-use when any person shall be entitled to a statutory right of occupancy, to issue written evidence indicating such right of occupancy.

The Act reads: “The terms and conditions of a Certificate of Occupancy granted under this Decree and which has been accepted by the holder shall be enforceable against the holder and his successors in title, notwithstanding that the acceptance of such terms and conditions is not evidenced by the signature of the holder or is evidenced by the signature only or, in the case of a corporation, is evidenced by the signature only of some person purporting to accept on – behalf of the corporation.”

The Act also embedded conditions and provisions implied in C of O, stating that “Every Certificate of Occupancy shall be deemed to contain provisions to the following effect that the holder binds himself to pay to the Governor the amount found to be payable in respect of any unexhausted improvements existing on the land at the date of his entering into occupation and that the holder binds himself to pay to the Governor the rent fixed by the Governor and any rent which may be agreed or fixed on revision in accordance with the provisions of Section 16.”

Explaining the legal benefit of acquiring a C of O, a human rights activist, Chief Malcolm Omirhobo said the document is a legal document issued by the government that proves that a person owns land in Nigeria.

He noted that C of O and Right of Occupancy are not the same. Right of Occupancy, he explained, is a grant of an interest in a land, while C of O is the document evidencing this interest. He said: “The C of O is merely an evidence of title, not an actual title. Where the title is defective, the C of O evidences nothing.

“It raises a prima facie presumption that the holder has an exclusive possession and has a Right of Occupancy. “However, where it is shown that another person has a better title, the court will set aside the Right of Occupancy of the first person regardless of the C of O.”

Citing Section 9 (a) of the Land Use Act, Omihorbo stated that the government is to issue a C of O when granting a statutory right of occupancy to anyone, when anyone is in occupation of the land under customary right of occupancy (non-urban areas) and when anyone is entitled to a statutory right of occupancy in urban areas.

This, he said, is the prerogative of the governor, and no governor can grant C of O as evidence of customary right of occupancy. Such, he insists, would be null, void and ineffectual.

“However, by virtue of Section 45(1) of the Land Use Act, the governor may delegate power to grant C of O to the commissioner-in-charge of the relevant subject matter who cannot delegate such power (delegatus non potest delegare).

“Section 9 of the Land Use Act provides for some conditions imposed on holders of C of O which include payment for the Certificate of Occupancy, failure of which may lead to cancellation of the certificate or even revocation of the Right of Occupancy.

“Section 10 of the Act further provides obligations to pay for unexhausted improvements existing on land at the date of entering into occupation and rent fixed by the governor,” he said.

Omihrobo also noted that holders of land prior to the enactment of the Land Use Act in 1978 are not bound by the provisions in Section 10(a), and if they do not wish to be bound by Section 10(b) they are advised not to apply for the C of O because once obtained, would be estopped from rejecting its conditions.

He further explained that in terms of compensation, by virtue of the provisions of the Land Use Act and the Nigerian Constitution, in the event of compulsory acquisition of land by the government, whereas the owner of such land does not have a Certificate of Occupancy or any other registered title, he/she will get minimal or no compensation.

His words: “Without C of O, the owner of land would have an equitable interest/title in the land and not legal interest/title. Of course, legal title takes priority over equitable title.

“A land without C of O cannot be used as collateral in terms of mortgage because there would be nothing to register the mortgage on.

“In terms of adverse title to land, where two people acquire equitable interest on the same land from the same source, the first to obtain a Certificate of Occupancy over the land gets a better and superior title because when there are two equities the first in time prevails.

“A land without C of O has no records at the Land Registry and is not searchable, because it is not registered with the Land Registry, search cannot be conducted on an unregistered land.

“Although not necessarily a legal implication, without a C of O, a landowner may not be able to sell his land at market value because it needs to be registered for it to have a good market value.”

Another lawyer, Malcolm Chuks explained that a C of O is a legal instrument or document issued by a state government that confirms the genuineness and authenticity of a property and proof that such exists.

“It is important to understand that a C of O and other ancillary land instruments are chiefly regulated by the Land Use Acts of 1978, which vests all control, management and supervision of land under the governor of a state to be carried out in trust for the citizens.

“Also, it is essential to take note that a C of O is only granted for a term of 99 years and that the state government has the power to review, extend and revoke the same subject to the dictates of the Land Use Act instrument,” he explained.

Citing Section 9 of the Land Use Act 1978, Chuks stated that any person is entitled to statutory rights under the law, which are provided by the governors.

The section, he said, goes to show the unilateral power of the state governors to issue C of O on their respective states and their antecedents. Chuks noted that fake C of O promotes a multiplicity of land disputes. “A C of O is at best a secondary document and a rebuttable proof of title, which without being properly issued results in a situation where a purchaser of the same property with superior evidence can dispute it and defeat the possessor.

“If proved by evidence that another has a better title to a property and is able to demonstrate it, the court has the power to revoke the document.

“It creates difficulty for property owners to access financial facilities and services which include loans, and mortgage instruments.

“Property without valid C if O decreases in value and makes it less attractive for purchasers to buy. A property without a C of O can be seized and revoked at any time without compensation,” he declared.

Chuks lamented that the importance of C of O and the need to acquire it increases the likelihood of fraudulent practices and misrepresentations due to the absence of a verifiable Root of Title.

A Root of Title, he said, should explain how a property came into existence and who the actual owner is He further explained that a C of O has no defined time limit and assuming, but not conceding that such exists, it is usually prudent and wise for prospective purchasers to perfect their title documents at the earliest convenience to avoid future embarrassment, loss of potential investment in the long run and unnecessary litigations and cost.

“It is advisable for an applicant, after purchase of a property, to obtain a form from the Land Registry to avoid scammers taking advantage of one’s ignorance.

“Also, the form can be downloaded online with the properly designated website and the application form properly attached with the following documents, including, but are not limited to passport photograph and evidence of payment of application fee,” he explained. He advised that it is important to do one’s due diligence on any property before purchase. He further advised that people should hire an experienced lawyer to make compulsory requisitions and findings before purchasing a property.

Also, Orioha Uchenna, a lawyer, said without a C of O, an occupant of a property may lose it to the government without compensation. The Land Use Act, he reiterated, vests ownership of land in the hands of the state governments, who shall hold it in trust for the benefits of the people.

Uchenna, however, argued that there is no time limit for C of O’s, adding that undue delay may affect the prospective applicant with regard to compensation if the need arises as delay defeats equity.

September 26, 2023