GOVERNOR’S CONSENT

See Section 22 of the Land Use Act. A holder of a statutory right of occupancy cannot alienate his right by assignment, mortgage, transfer of possession, sublease or otherwise without the consent of the Governor. That is what Section 22 of LUA says.

Section 26 of the same Act states that any transaction or any instrument which purports to confer on or vest in any person any interest or right over land other than in accordance with the provisions of this Act shall be null and void. See SAVANNAH V. AJILO (1989) 1 NWLR (PT. 77) 305. In this case, the Supreme Court held that the legal mortgage that was executed in favour of the bank by the respondents was declared null and void on the ground that consent of the Governor was not obtained. The Supreme Court stated in that case that it was not canvassed before the court that the respondents, having enjoyed the overdraft from the appellant bank, cannot rely on their own failure to obtain consent to the transaction to defeat the right of the appellant bank to sell the mortgaged property. The case was never fought for the appellant bank on equitable grounds. The decision in SAVANNAH BANK OF NIGERIA LTD. V. AJILO should, therefore, not be regarded as a general principle of law and the principle of law therein should be confined to the peculiar facts of that case.

See also FEDERAL MORTGAGE BANK OF NIGERIA V. BABATUNDE (1999) 12 NWLR 632,particularly at page 683. Here, AJILO V. SAVANNAH BANK’s case was followed. It was held that a mortgagor was void for absence of the requisite consent. In UGOCHUKWU V. COOPERATIVE AND COMMERCE BANK NIGERIA LIMITED (CCB) (1996) 6 NWLR (PT. 456) 524, it was held that the holder of a right of occupancy is the one to seek the consent of the Governor. A mortgagor cannot be held to say that the transaction is void for lack of consent.

In the case of ADEDEJI V. NATIONAL BANK OF NIGERIA (1989) 1 NWLR 212,the court held that the transaction was inchoate.

In AWOJUGBAGBE LIGHT INDUSTRIES V. CHINUKWE AND ANOR (1995) 4 SCNJ 162, Section 22(a) of the Land Use Act states that consent of the Governor was not required to the creation of a legal mortgage over a statutory right of occupancy in favour of the person in whose favour an equitable mortgage over the right of occupancy had already been created with the consent of the Governor.

Section 22(b) of the Land Use Act provides that consent shall not be required to the reconveyance or release by a mortgagee to a holder or occupier of a statutory right of occupancy which that holder or occupier has mortgaged to that mortgagee with the consent of the Governor. 

to be continued with

CREATING A LEGAL MORTGAGE: CONSENT

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