Beyond the Paper: Why a C of O Alone is Not Enough When Buying Property in Nigeria

In the dynamic and often complex Nigerian real estate market, the Certificate of Occupancy (C of O) is widely regarded as the gold standard of property ownership. It is a government-issued document that signifies the Governor’s consent for an individual or corporate entity to occupy and use a piece of land for a specific period, typically 99 years. Many buyers breathe a sigh of relief once they sight this document, believing their investment is secure.

However, this over-reliance on the C of O alone is a dangerous misconception that has led countless Nigerians into devastating financial losses and protracted legal battles. A C of O is a critical piece of the puzzle, but it is not the entire picture. Here’s why.

Why a Certificate of Occupancy is Not Foolproof

1. It is Not a Title Guarantee: A C of O is essentially a lease from the state government. It confirms that the government believes the named holder is the owner. However, it does not automatically extinguish pre-existing rights or claims to the land. If the process of obtaining it was flawed—for instance, if there was a hidden family interest, a prior owner, or a fraudulent claim—the C of O can be challenged and even revoked in court.
2. The Risk of Multiple Allocations: In a troubling but common practice known as “double allocation,” the same plot of land can be inadvertently or fraudulently allocated to two different parties by government officials. You could hold a genuine C of O for a plot, only to discover another party holds a different C of O for the same land, leading to an intractable dispute.
3. It Doesn’t Reveal Encumbrances: A C of O in your hand does not reveal if the property has been used as collateral for a bank loan (i.e., has a mortgage), if there is a court injunction or litigation pending against it, or if there are any unpaid tenement rates or ground rents. These “encumbrances” become your legal problem the moment you purchase the property.
4. The “Governor’s Consent” is Key for Sale: The C of O you are viewing might be in the name of the current seller. For the sale to be legally complete, that interest must be transferred to you with the consent of the Governor. A purchase without obtaining this consent is legally incomplete and can be set aside. Simply holding the seller’s old C of O is meaningless if the transfer process hasn’t been duly followed.

What to Do Before You Pay: A Due Diligence Checklist

To avoid becoming another statistic of property fraud, you must undertake rigorous due diligence. Here is a step-by-step guide on what to do before parting with your money.

1. Conduct a Thorough Search at the Land Registry: This is the single most important step. Engage a lawyer to conduct a comprehensive land search at the official state land registry (e.g., Alausa Secretariat in Lagos, Ministry of Lands in other states). This search will reveal:

· The true owner on record.
· The history of past transactions (title history).
· Any existing encumbrances, such as mortgages, liens, or court judgments.
· The status of the C of O and ground rents.

2. Verify the Seller’s Identity: Ensure the person or entity selling the property is the same as the one revealed in the land registry search. Request for a valid means of identification and cross-check. For companies, verify their registration status with the Corporate Affairs Commission (CAC) and ensure the signatory has the authority to act on the company’s behalf.
3. Conduct a Physical Site Inspection and Neighborhood Investigation: Don’t just buy from a brochure. Visit the property multiple times and at different times of the day. Engage neighbours and local community leaders (Baale, Family Head) to inquire about the true ownership history of the land. Often, communities are aware of disputes long before they appear in official records.
4. Investigate the Root of Title: Go beyond the current seller. Ask questions like: “Where did you get the land from?” Understanding the chain of ownership (root of title) back to its original source (e.g., the family or government) helps you identify potential breaks or forgeries in the chain.
5. Obtain a Survey Plan and Verify it: A survey plan is a scaled drawing of the land that defines its precise boundaries and coordinates. Have a licensed surveyor verify the authenticity of the survey plan with the Surveyor-General’s office to ensure it hasn’t been forged and that the land does not fall within a government acquisition area.
6. Check for Government Acquisition: Some lands are under “global acquisition” for public use. Even with a C of O, land within a committed government acquisition (e.g., for a future road, school, or rail line) can be reclaimed without compensation. Your lawyer and surveyor can help confirm this.
7. Engage a Competent Real Estate Lawyer: This is non-negotiable. Do not use a “kayoform” lawyer or try to cut costs here. A good lawyer will guide you through every step, conduct the necessary searches, prepare the sale agreement, and ensure the perfection of the title by obtaining the Governor’s Consent after purchase. Their fee is a small price to pay for peace of mind.
8. Get a Written Agreement and Stage Your Payments: Never pay for property in a single lump sum, especially with private individuals. Structure payments in stages tied to milestones (e.g., 10% on signing agreement, 50% after successful land search, 30% on execution of deed of assignment, 10% after Governor’s Consent is applied for). Always use bank transfers for a clear audit trail, never cash.