Historical Evolution — Post-Independence to the Land Use Act of 1978

Institute of Mortgage Brokers Limited (IMBL) of Nigeria

Certification Programme — 2026 Edition

© 2026 IMBL of Nigeria. All Rights Reserved.

Learning Objectives

Upon successful completion of this lesson, the candidate shall be able to:

Describe the fragmented legal landscape governing land ownership across the Nigerian federation in the period between independence in 1960 and the promulgation of the Land Use Act in 1978, with particular reference to regional variations in tenure systems.

Analyse the socio-economic conditions—including speculative land acquisition, fraudulent multiple sales, and rapid urbanisation in Lagos, Ibadan, and Kano—that generated sustained political pressure for comprehensive land reform during the 1960s and 1970s.

Explain the political and institutional circumstances under the military government of General Olusegun Obasanjo that culminated in the enactment of the Land Use Act, Cap. L.5, Laws of the Federation of Nigeria, 2004 (originally Decree No. 6 of 1978).

Articulate the core philosophical objectives underpinning the Land Use Act, including the unification of tenure, the elimination of speculative land-holding, and the broadening of equitable access to land for all Nigerians.

Distinguish between Statutory Rights of Occupancy granted by the Governor and Customary Rights of Occupancy granted by Local Governments, and identify the incidents and limitations attaching to each category.

Evaluate the requirement of Governor’s Consent under section 22 of the Land Use Act and its practical implications for mortgage transactions, land transfers, and conveyancing practice.

Assess the constitutional entrenchment of the Land Use Act through section 315 of the 1999 Constitution, and explain the procedural requirements for amendment.

Critically examine ongoing debates, scholarly criticisms, and proposed amendments to the Land Use Act in light of contemporary economic realities, judicial pronouncements, and policy recommendations.

Apply the principles established in Savannah Bank v. Ajilo (1989), Adole v. Gwar (2008), and Yakubu Ibrahim v. Simon Obaje (2017) to practical scenarios involving land transactions, mortgage security, and consent requirements.

Evaluate the implications of the Land Use Act for mortgage professionals in Nigeria, particularly with respect to title verification, due diligence, and the enforceability of security interests over land.

Introduction

The Land Use Act of 1978 represents one of the most consequential legislative interventions in the history of Nigerian property law. Its enactment fundamentally restructured the system by which land is held, managed, and transferred across the entire federation, replacing a complex patchwork of customary, regional, and received English law with a single, nationally applicable statutory framework. For mortgage professionals operating within the Nigerian real estate market, the Act constitutes the foundational legal instrument upon which virtually all contemporary land transactions are predicated. No mortgage can be created, no security interest perfected, and no title reliably verified without reference to the provisions of this legislation and the body of case law that has developed around it.

This lesson traces the historical trajectory that led to the enactment of the Land Use Act. The analysis begins with the legal landscape inherited at independence in 1960, proceeds through the socio-economic dislocations of the 1960s and 1970s that rendered reform imperative, examines the political context within which the Act was promulgated, and concludes with a detailed treatment of the Act’s substantive provisions, its constitutional entrenchment, and the ongoing debates concerning its adequacy for the demands of a twenty-first-century economy. Throughout, judicial pronouncements are woven into the analysis to illustrate how courts have interpreted and applied the Act’s provisions in practice.

The importance of this subject to the IMBL certification candidate cannot be overstated. A mortgage broker who lacks a thorough understanding of the Land Use Act’s historical origins, core provisions, and judicial interpretation operates at considerable professional risk. Transactions conducted without proper regard for the Act’s requirements—particularly the Governor’s Consent provisions—may be rendered void, exposing both broker and client to significant financial loss. This lesson accordingly provides both the historical context and the doctrinal foundation upon which subsequent lessons in Module 3 will build.

1. The Post-Independence Legal Patchwork (1960–1978)

At the point of independence on 1 October 1960, Nigeria inherited a profoundly fragmented system of land law. The colonial period had produced no unified land code; instead, land administration was governed by a complex mosaic of customary tenure systems, colonial ordinances, received English law, and regional legislation, the precise contours of which varied sharply from one part of the federation to another. The result was a legal environment characterised by deep internal contradictions, overlapping jurisdictional claims, and persistent uncertainty regarding the nature and extent of proprietary rights in land.

In the Northern Region, land administration was shaped decisively by the Land and Native Rights Ordinance of 1910 (later the Land Tenure Law of 1962), under which all land in the region was deemed to be “native land” held in trust by the Government, and individual rights took the form of rights of occupancy rather than freehold ownership. This approach reflected both Islamic conceptions of land as a communal resource and British colonial preference for administrative control over land allocation in the North. By 1960, the Northern system had been in operation for half a century, and its administrative machinery—including the allocation of Certificates of Occupancy by the Governor—was relatively well established, though by no means free of controversy.

In the Western Region, land was governed predominantly by customary tenure, under which ownership was vested in families, communities, or stools (chieftaincy institutions). The head of the family or community held land in a fiduciary capacity on behalf of present and future members of the group. Individual members enjoyed usufructuary rights—the right to use and occupy designated portions—but could not alienate family land without the consent of the family council. The received English law of property applied in urban centres, particularly Lagos (which had been a Crown Colony), giving rise to a dual system in which freehold titles existed alongside customary holdings, often in respect of immediately adjacent parcels.

In the Eastern Region, customary land tenure was similarly predominant, but the particular customs differed substantially from those prevailing in the West. Among the Igbo, land was typically held by patrilineal kinship groups, and the incidents of tenure—including rights of allocation, reversion, and alienation—were determined by the specific customs of each community. The absence of a centralised chieftaincy structure in many Igbo communities meant that land governance was more diffuse and less formalised than in the Western Region, contributing to higher levels of disputation.

The Mid-Western Region, created in 1963, inherited elements of both Western and Eastern tenure traditions, compounding the complexity. Across all regions, the Conveyancing Act of 1881, the Property and Conveyancing Law (applicable in Western Nigeria), and the Registration of Titles Act operated in parallel with customary law, creating a layered and often internally contradictory normative framework.

The creation of twelve states in 1967 (and subsequently nineteen states in 1976) further multiplied the jurisdictional complexity. Each state inherited the land laws of the region from which it had been carved, but the process of succession was neither systematic nor uniform. Newly created states in the North continued to operate under the Land Tenure Law of 1962, while those in the South applied varying combinations of customary law, received English law, and regional statutes. The absence of a coordinating mechanism meant that a single transaction—for instance, a mortgage secured against properties located in Lagos and Kano—could be subject to entirely different legal regimes, with different requirements for validity, different registration systems, and different remedial structures.

Approximately sixty per cent of all land in Nigeria at the time of independence was held under one form or another of customary tenure, according to estimates compiled by the Federal Ministry of Lands and Housing in the mid-1970s. In many communities, boundaries were determined by natural features—rivers, trees, rock formations—rather than by surveyed coordinates, and the evidence of title consisted of oral testimony rather than written documentation. The absence of reliable records made it exceedingly difficult for courts to adjudicate disputes, for lenders to verify title, and for the state to plan infrastructure development.

The practical consequence of this fragmentation was that the Nigerian land market operated, in effect, as a collection of separate and largely impermeable local markets, each governed by its own rules. Land that was freely alienable under one legal regime might be inalienable under another, and a transaction that was perfectly valid in one state could be void or voidable in a neighbouring jurisdiction. For the nascent mortgage industry, this created an environment of pervasive uncertainty that substantially increased transaction costs and inhibited the flow of capital into real estate.

The decades following independence witnessed an accelerating pattern of speculative land acquisition, particularly in the peri-urban zones surrounding Nigeria’s rapidly expanding cities. Individuals and corporate entities with access to capital acquired large tracts of land—often from rural communities at prices far below the anticipated future value—and held them idle in expectation of appreciation. This pattern was especially pronounced around Lagos, where the population grew from approximately 762,000 in 1960 to an estimated 3.5 million by 1975, generating intense demand for residential, commercial, and industrial land. In Ibadan, Kano, Port Harcourt, and Kaduna, similar dynamics prevailed, albeit at a somewhat smaller scale.

Speculative holding produced several deleterious consequences. Vast expanses of land on the urban fringe remained undeveloped even as housing shortages reached crisis proportions. The concentration of land in the hands of a relatively small number of wealthy individuals and families exacerbated social inequality and deprived the state of land needed for public purposes. The Federal Government’s own infrastructure programmes—road construction, industrial estates, housing schemes—were repeatedly obstructed by the need to negotiate acquisition from private holders, often at exorbitant prices inflated by speculative expectations.

Between 1960 and 1975, land prices in central Lagos increased by an estimated 800 to 1,200 per cent in nominal terms, according to data compiled by the Lagos Executive Development Board. In Kano’s Nassarawa GRA and Ibadan’s Bodija estate, comparable escalations were recorded. These figures far outstripped general inflation and reflected, in large part, the operation of speculative forces rather than genuine productive demand. The result was that access to land for housing, agriculture, and enterprise was effectively rationed by wealth, a circumstance that sat poorly with the egalitarian rhetoric of post-independence Nigerian politics.

The absence of a comprehensive, reliable system of land registration across much of Nigeria facilitated a flourishing trade in fraudulent land transactions. The practice of selling the same parcel of land to multiple purchasers—colloquially known as “double-selling” or “419 land”—was endemic in the southern states, where customary tenure permitted alienation but lacked the documentary and registration safeguards necessary to prevent fraud. A family head might sell a parcel to one buyer, collect payment, and subsequently sell the same parcel to a second or even third buyer, each of whom would possess what appeared to be a valid receipt or agreement of sale.

The courts were inundated with land disputes arising from these practices. In Lagos alone, it was estimated by the Chief Registrar of the High Court in 1974 that land-related cases accounted for approximately forty per cent of the civil docket, with average case durations extending to five or more years. The transaction costs associated with verifying title, defending against fraudulent claims, and litigating disputes constituted a significant drag on economic activity and a substantial barrier to the development of a functioning mortgage market.

For mortgage lenders, the risks were particularly acute. A loan secured against land to which the borrower’s title was subsequently defeated by a prior or competing claim could result in total loss of the security. The absence of title insurance (which was virtually unknown in Nigeria at the time) meant that lenders bore the full risk of title defects, a circumstance that contributed to the extremely conservative lending practices and high interest rates characteristic of the pre-1978 Nigerian mortgage market.

The cumulative effect of speculation, fraud, and legal fragmentation was to produce a system of land distribution that was profoundly unequal. Wealthy urban elites, traditional rulers, and politically connected individuals were able to accumulate substantial land holdings, while the majority of Nigerians—particularly rural-to-urban migrants, women, and members of minority ethnic groups—found access to land increasingly constrained. The customary tenure systems, while possessing genuine virtues of community orientation and social cohesion, had not been designed to cope with the pressures of rapid urbanisation and a monetised land market, and their protective mechanisms were frequently overwhelmed.

Women faced particular obstacles. Under many customary systems, women could not own or inherit land in their own right; their access to land was mediated through male relatives—fathers, husbands, or brothers. Widows were especially vulnerable, as the death of a husband could result in the loss of the matrimonial home to the husband’s family under customary rules of succession. These inequities would later form part of the policy justification for the Land Use Act’s aspiration to ensure “equitable access” to land for all Nigerians.

3. Rapid Urbanisation and the Intensification of Land Pressures (1960s–1970s)

Nigeria’s post-independence decades were characterised by one of the most rapid processes of urbanisation ever recorded on the African continent. The urban population, which had constituted approximately fifteen per cent of the national total in 1960 (roughly 8.1 million persons out of a total population of 54 million, according to the 1963 Census), had risen to an estimated twenty-five per cent by 1975 (approximately 17.5 million out of 70 million). Lagos, the federal capital, was the epicentre of this transformation, growing at an annual rate of approximately eight per cent during the 1960s and continuing to expand explosively through the 1970s, fuelled by the petroleum boom and the concentration of federal employment and commercial activity.

Ibadan, already one of Africa’s largest cities in 1960 with a population exceeding one million, experienced sustained growth driven by its role as the capital of the Western Region and a major centre of education and commerce. Kano, the commercial hub of the North, grew rapidly as trade, light manufacturing, and the groundnut economy drew migrants from across the northern states. Port Harcourt, centre of the petroleum industry in the Niger Delta, experienced particularly intense growth during the 1970s oil boom.

These demographic pressures placed enormous strain on existing systems of land allocation and management. Customary land tenure, designed for relatively stable agrarian communities, was ill-equipped to manage the conversion of agricultural land to urban uses on the scale demanded by these population movements. The traditional mechanisms of land allocation—family councils, community elders, and chiefs—were overwhelmed by the sheer volume of requests and the commercial pressures brought to bear by developers and speculators.

The petroleum boom of the 1970s injected unprecedented volumes of capital into the Nigerian economy. Federal government revenue increased from approximately NGN 633 million in 1970 to NGN 10.4 billion by 1977, an increase of more than 1,500 per cent in just seven years. A substantial proportion of this wealth was channelled into construction, real estate development, and land acquisition, intensifying the speculative pressures that were already straining the land market.

State governments, newly flush with oil revenue distributed through the Federation Account, embarked on ambitious programmes of urban development, infrastructure construction, and housing provision. These programmes required the acquisition of large tracts of land, but the existing legal framework—under which land was held under customary tenure or freehold—made compulsory acquisition slow, expensive, and politically contentious. The federal military government of General Yakubu Gowon (1966–1975) and subsequently General Murtala Muhammed (1975–1976) both expressed frustration at the obstacles that land tenure presented to national development planning.

The intersection of enormous oil wealth, rapid urbanisation, speculative land-holding, and an antiquated legal framework produced a crisis of land governance that could no longer be addressed through incremental reform. Increasingly, the view crystallised among senior military officers, civil servants, and legal scholars that nothing less than a fundamental restructuring of the entire land tenure system would suffice.

By the mid-1970s, a broad consensus had emerged among Nigerian policy-makers that the existing system of land tenure was inimical to national development. The principal complaints were well documented in a series of government reports and commissions of inquiry. The Land Use Panel, chaired by Justice Chukwudifu Oputa and appointed by the Federal Military Government in 1977, received submissions from across the federation and documented the following recurrent grievances: the concentration of land in the hands of speculative holders; the prevalence of fraudulent transactions; the inadequacy of existing registration systems; the difficulty and expense of acquiring land for public purposes; the social inequities embedded in customary tenure; and the inhibiting effect of land tenure fragmentation on economic development and capital formation.

The Panel’s recommendations formed the intellectual foundation of what would become the Land Use Act. At the core of the Panel’s analysis was the proposition that land, as a finite and essential national resource, should not be subject to unlimited private accumulation and speculation. Instead, the state should assume a custodial role, holding land in trust for the benefit of all Nigerians and allocating it in accordance with rational planning and equitable principles. This proposition drew upon diverse intellectual sources: the Northern Nigerian experience of state control over land under the Land Tenure Law; socialist conceptions of land as social property rather than private commodity; and the practical imperatives of a government seeking to implement rapid development programmes.

The political context within which the Land Use Act was promulgated is essential to understanding both its form and its subsequent entrenchment in the constitutional order. By 1978, Nigeria had been under military rule for twelve of its eighteen years of independence. The military government of General Olusegun Obasanjo, which had assumed power following the assassination of General Murtala Muhammed in February 1976, was engaged in a programme of political transition designed to return the country to civilian rule by 1 October 1979.

The transition programme afforded the Obasanjo government both the motivation and the opportunity to enact sweeping reforms that would have been difficult or impossible under a civilian democratic government. Land reform, in particular, was an issue on which powerful vested interests—traditional rulers, landed elites, and established property owners—would have mobilised formidable opposition in a legislative assembly. The military government, unconstrained by such considerations, was able to promulgate the Land Use Act by decree (Land Use Decree No. 6 of 1978), bypassing the consultative and deliberative processes that would have attended legislative enactment.

It was against this backdrop—of crisis-level land pressures, an intellectual consensus favouring state intervention, and a military government with both the authority and the inclination to act decisively—that the Land Use Act was promulgated on 29 March 1978, coming into effect on the same date. The Act applied immediately and uniformly throughout the federation, overriding all prior and inconsistent legislation, whether federal, regional, or state in origin.

The architects of the Land Use Act drew, whether explicitly or implicitly, upon several comparative models. The Tanzanian approach under the Land Ordinance (Cap. 113), which had vested all land in the President as trustee, provided one precedent. The Zambian Lands and Deeds Registry Act, which similarly centralised land administration, offered another. In the Nigerian context, the closest domestic precedent was the Northern Nigerian Land Tenure Law of 1962, which had operated for more than fifteen years and which vested land in the government while granting rights of occupancy to individuals. The Land Use Act in many respects nationalised the Northern model, extending its core principles to the southern states where freehold and customary tenure had previously prevailed.

The Land Use Act was founded upon three interlocking policy objectives, as articulated in its long title and elaborated in the reports of the Land Use Panel. The first objective was unification: the replacement of the fragmented patchwork of regional, customary, and received English land laws with a single, nationally applicable statutory framework. The second was the elimination of speculative land-holding: by vesting ownership of all land in the state and limiting the quantum of land that any individual could hold, the Act sought to break the pattern of accumulation that had distorted land markets and excluded the majority of Nigerians from access. The third was equitable access: the Act aspired to create a system under which land would be allocated on the basis of need, productive capacity, and rational planning rather than on the basis of inherited wealth, political connection, or speculative acumen.

These objectives were pursued through a radical restructuring of proprietary rights. Upon the commencement of the Act on 29 March 1978, all land comprised in the territory of each state of the federation was deemed to be vested in the Governor of that state, to be held in trust and administered for the use and common benefit of all Nigerians in accordance with the provisions of the Act. This single provision—contained in section 1 of the Act—effected the most sweeping expropriation of private property rights in Nigerian legal history, transforming the legal character of every parcel of land in the country from freehold or customary ownership to a form of state trusteeship.

Section 1 of the Land Use Act provides: “Subject to the provisions of this Act, all land comprised in the territory of each State in the Federation are hereby vested in the Governor of that State and such land shall be held in trust and administered for the use and common benefit of all Nigerians in accordance with the provisions of this Act.” The effect of this provision was twofold. First, it extinguished all existing freehold titles, converting them into deemed rights of occupancy. Second, it vested proprietary control in the state, represented by the Governor, who was empowered to grant, revoke, and administer rights of occupancy in accordance with the Act’s provisions.

The vesting provision was not, however, absolute. The Act preserved certain existing rights: holders of freehold titles were deemed to hold statutory rights of occupancy (section 34), and holders of customary rights continued to enjoy their existing entitlements, subject to the overriding authority of the Governor. The transition was designed to be automatic and self-executing; no act of registration or formal conversion was required. Nevertheless, the practical consequences of the vesting provision have been the subject of extensive judicial interpretation over the decades since enactment, as courts have grappled with the tension between the Act’s sweeping language and the practical reality of pre-existing rights.

The Land Use Act establishes two categories of rights of occupancy, each with distinct characteristics, incidents, and administrative regimes.

5.3.1 Statutory Right of Occupancy

A Statutory Right of Occupancy is granted by the Governor in respect of land in urban areas (defined by reference to the area falling within the jurisdiction of a State Capital or any other area designated by the Governor). The grant is evidenced by a Certificate of Occupancy (C of O), which constitutes the highest form of title obtainable under the Act. The holder of a Statutory Right of Occupancy is entitled to exclusive possession and use of the land for the term specified in the certificate (typically ninety-nine years, although shorter terms may be granted), subject to the payment of ground rent and compliance with the conditions of the grant.

A Statutory Right of Occupancy may be granted for residential, agricultural, commercial, or industrial purposes, and the grant may be subject to conditions regarding the manner and intensity of use. The Governor retains the power to revoke a right of occupancy on specified grounds, including overriding public interest, breach of conditions, and failure to pay rent (sections 28–29). Revocation entitles the holder to compensation for the value of unexhausted improvements, but not for the value of the land itself—a distinction that has been the source of considerable litigation and criticism.

5.3.2 Customary Right of Occupancy

A Customary Right of Occupancy is granted by the Local Government in respect of land in non-urban areas. This right is typically held by persons who occupied land under customary tenure prior to the commencement of the Act and whose occupation has been confirmed or regularised by the Local Government. Customary Rights of Occupancy are not evidenced by a Certificate of Occupancy, although some states have introduced administrative instruments for documentation purposes.

The holder of a Customary Right of Occupancy is entitled to use the land in accordance with the terms of the grant and the applicable customary practices. Customary rights are subordinate to Statutory Rights in the administrative hierarchy of the Act, and the Governor may revoke a Customary Right of Occupancy on the same grounds as a Statutory Right. In practice, the vast majority of rural landholders in Nigeria hold Customary Rights of Occupancy, whether formally granted or deemed by operation of section 36 of the Act.

Section 22 of the Land Use Act provides that no holder of a right of occupancy shall alienate their right or any part thereof by assignment, mortgage, transfer of possession, sublease, or otherwise howsoever without the consent of the Governor. This provision—commonly referred to as the “Governor’s Consent” requirement—is one of the most consequential and most litigated provisions of the Act, and it has direct and immediate relevance to mortgage practice.

The purpose of the consent requirement was explained by the Supreme Court in Savannah Bank of Nigeria Ltd v. Ajilo (1989) 1 NWLR (Pt. 97) 305, in which the Court held that a mortgage created without the prior consent of the Governor was null and void and of no effect whatsoever. In that landmark decision, the Supreme Court reasoned that the consent requirement was not a mere formality but a substantive condition of validity, compliance with which was essential to the creation of any legally enforceable interest in land. The decision sent shockwaves through the banking and mortgage industries, as it meant that any existing mortgage that had been created without Governor’s Consent was potentially unenforceable.

The practical implications of Savannah Bank v. Ajilo for mortgage professionals are profound. Before accepting land as security for a loan, the mortgage broker must ascertain not only that the borrower holds a valid right of occupancy but also that Governor’s Consent has been obtained (or will be obtained) for the proposed mortgage transaction. The absence of consent renders the entire transaction void ab initio—not merely voidable, but void—meaning that the lender has no enforceable security interest and no right of recourse against the land. In the decades since the Savannah Bank decision, compliance with the Governor’s Consent requirement has become a non-negotiable element of due diligence in Nigerian mortgage practice.

The process of obtaining Governor’s Consent is administered by the State Ministry of Lands (or its equivalent), and it typically involves the submission of an application accompanied by the relevant title documents, a survey plan, evidence of payment of ground rent, and payment of a consent fee (which varies by state but typically ranges from one and a half to three per cent of the transaction value). Processing times vary widely; in some states, consent can be obtained within four to eight weeks, while in others, delays of six months to two years have been reported. These delays constitute a significant practical obstacle to efficient land transactions and have been a persistent source of complaint from market participants.

The Land Use Act occupies a unique position in Nigerian law by virtue of its incorporation into the constitutional framework. Section 315(5)(d) of the Constitution of the Federal Republic of Nigeria, 1999 (as amended) lists the Land Use Act among the “existing laws” that are deemed to be Acts of the National Assembly, and the Act is specifically mentioned in section 315(5). The effect of this incorporation is that the Land Use Act cannot be amended or repealed by ordinary legislation; any modification requires the procedure prescribed for constitutional amendment under section 9 of the Constitution, which mandates approval by two-thirds of the members of each chamber of the National Assembly and ratification by the Houses of Assembly of not less than two-thirds of the states of the federation.

This constitutional entrenchment has had the practical effect of insulating the Land Use Act from legislative reform, notwithstanding widespread criticism of many of its provisions. Successive civilian administrations have commissioned reviews and proposed amendments, but the political difficulty of securing the requisite supermajorities in both the National Assembly and the state legislatures has prevented any substantial modification from being enacted. The Act thus remains in force in essentially the same form in which it was promulgated by the military government in 1978, a circumstance that has generated considerable scholarly debate regarding the appropriateness of entrenching legislation of this character in the constitutional order.

The courts have addressed the constitutional status of the Land Use Act on numerous occasions. In Adole v. Gwar (2008) 11 NWLR (Pt. 1099) 562, the Court of Appeal considered the scope of the Governor’s powers under the Act and affirmed that the constitutional entrenchment of the Act meant that its provisions were to be construed as having the force and effect of constitutional provisions. The Court held that any state legislation or executive action inconsistent with the Land Use Act was void to the extent of the inconsistency, in the same manner as legislation inconsistent with the Constitution itself would be void under section 1(3) of the Constitution.

The decision in Adole v. Gwar underscored the practical reality that the Land Use Act, by virtue of its constitutional status, occupies a position in the hierarchy of Nigerian law that is superior to that of ordinary federal or state legislation. For mortgage professionals, this means that the Act’s provisions cannot be circumvented, overridden, or modified by state-level legislation or administrative practice. Compliance with the Act is not merely a statutory obligation; it is a constitutional one, and transactions that contravene its provisions are void by operation of the supreme law of the land.

Savannah Bank of Nigeria Ltd v.

Ajilo (1989) 1 NWLR (Pt. 97) 305In this seminal decision, the Supreme Court of Nigeria was called upon to determine the legal effect of a mortgage created over land subject to the Land Use Act without the prior consent of the Governor.

The respondent, Ajilo, had mortgaged his property to Savannah Bank as security for a loan facility.

When Ajilo defaulted and the bank sought to enforce its security, Ajilo contended that the mortgage was void because Governor’s Consent had not been obtained at the time of its creation.

The Supreme Court, in a unanimous decision, held that the requirement of Governor’s Consent under section 22 of the Land Use Act was mandatory and that any alienation—including a mortgage—effected without such consent was null and void ab initio.

The Court rejected the bank’s argument that absence of consent rendered the transaction merely irregular rather than void, holding that the statutory language admitted of no such distinction.

The decision established the foundational principle that Governor’s Consent is a condition precedent to the validity of any transaction involving the alienation of a right of occupancy.

For the mortgage industry, the case established that no security interest in land can be validly created without prior or contemporaneous Governor’s Consent, and that a lender who advances funds on the security of unconsented land does so entirely at its own risk.

Adole v.

Gwar (2008) 11 NWLR (Pt. 1099) 562The Court of Appeal in this case examined the relationship between the Land Use Act and the constitutional order.

The dispute arose from conflicting claims to a parcel of land in Benue State, with the appellant contending that state legislation had modified the effect of the Land Use Act in relation to the particular transaction.

The Court of Appeal held that the Land Use Act, having been incorporated into the Constitution by virtue of section 315(5)(d), could not be overridden by state legislation.

The Court affirmed that the Governor’s powers under the Act—including the power to grant and revoke rights of occupancy and the requirement of consent for alienation—were constitutionally entrenched and could only be modified through the constitutional amendment procedure prescribed by section 9.

The decision reinforced the principle that state-level administrative practices, no matter how long established, cannot derogate from the Act’s provisions.

For mortgage professionals operating across multiple states, the case confirmed that the Land Use Act establishes a uniform, nationally applicable framework that cannot be varied by local legislation or practice.

Yakubu Ibrahim v.

Simon Obaje (2017) LPELR-42994(CA)In this more recent decision, the Court of Appeal revisited the scope and application of Governor’s Consent in the context of a land transaction in which the parties had purported to transfer a right of occupancy without obtaining the Governor’s prior approval.

The appellant argued that subsequent ratification by the Governor should cure the initial defect and validate the transaction retroactively.

The Court of Appeal, applying the principle established in Savannah Bank v.

Ajilo, held that Governor’s Consent must be obtained prior to or contemporaneously with the transaction; subsequent ratification does not retrospectively validate a void transaction.

The Court reasoned that to permit retrospective validation would undermine the purpose of the consent requirement, which is to enable the Governor to exercise supervisory control over land transactions at the point at which they occur, not after the fact.

The decision has significant implications for conveyancing practice: practitioners must ensure that Governor’s Consent is secured before completion of any transaction, and cannot rely on the possibility of obtaining consent after the event.

For mortgage brokers, the practical lesson is unambiguous—consent must be in hand before funds are disbursed, not merely applied for or anticipated.

In the more than four decades since its enactment, the Land Use Act has been the subject of sustained and wide-ranging criticism from legal scholars, economists, real estate professionals, and civil society organisations. The criticisms may be grouped into several principal categories.

First, the Act has been criticised for concentrating excessive discretionary power in the Governor. The authority to grant, revoke, and administer rights of occupancy, combined with the consent requirement for all forms of alienation, places the Governor in a position of extraordinary influence over the land market. Critics have argued that this concentration of power is susceptible to abuse, corruption, and political manipulation, and that it creates opportunities for rent-seeking behaviour by state officials. Empirical studies conducted by the Nigerian Institution of Estate Surveyors and Valuers have documented instances in which consent applications were delayed or denied for reasons unrelated to the merits of the transaction, imposing substantial costs on applicants.

Second, the consent regime has been criticised for its inefficiency. The processing of consent applications is notoriously slow in many states, with reported average processing times ranging from three months to over two years. These delays impose significant holding costs on parties to land transactions, discourage investment, and impede the development of a liquid and efficient land market. The World Bank’s Doing Business reports have consistently identified the consent regime as one of the principal obstacles to ease of doing business in Nigeria’s property sector, with Nigeria ranking 183rd out of 190 economies for registering property in the 2020 report.

Third, the compensation provisions of the Act have been criticised as inadequate. Under sections 28–29, a holder whose right of occupancy is revoked is entitled to compensation for the value of unexhausted improvements but not for the value of the land itself. This means that a person who has held land for decades and whose land has appreciated substantially in value receives compensation only for the buildings, crops, or other improvements on the land, not for the land’s market value. This provision has been described by critics as amounting to expropriation without adequate compensation, and it has been the subject of constitutional challenge, though no court has yet declared the provision unconstitutional.

Fourth, the Act has been criticised for failing to account for the continued vitality of customary tenure. Despite the Act’s aspiration to unify the land tenure system, customary norms continue to govern land relations in much of rural Nigeria. The formal institutions established by the Act—the Governor’s office, the Land Use and Allocation Committee, the Land Advisory Committee—have limited reach in rural areas, and the vast majority of rural landholders have never obtained formal documentation of their rights. The result is a persistent gap between the de jure framework established by the Act and the de facto reality of land governance on the ground.

Numerous proposals for reform have been advanced over the years. The Presidential Technical Committee on Land Reform, established in 2009 under the administration of President Umaru Musa Yar’Adua, recommended a comprehensive overhaul of the Act, including the streamlining of the consent process, the introduction of compensation for land value (not merely improvements), the devolution of certain powers from the Governor to lower levels of government, and the establishment of a national electronic land registration system. Similar recommendations were made by the National Conference of 2014 and by various state-level reform commissions.

Despite the breadth and persistence of the reform consensus, the constitutional entrenchment of the Act has presented a formidable obstacle to legislative action. The requirement for a two-thirds supermajority in the National Assembly and ratification by two-thirds of state legislatures means that any amendment must command an extraordinary degree of political support. To date, no amendment has secured the requisite majorities, and the prospect of comprehensive reform remains uncertain.

In the absence of legislative amendment, some states have undertaken administrative reforms designed to ameliorate the Act’s deficiencies within the existing statutory framework. Lagos State, for instance, has introduced electronic processing of consent applications through the Lagos State Electronic Land Administration System (LEAS), reducing processing times and increasing transparency. Kaduna State has implemented similar reforms. These state-level initiatives, while valuable, are limited in scope and cannot address the structural features of the Act that require legislative modification.

For mortgage professionals, the ongoing debates surrounding the Land Use Act are not merely academic; they have direct practical implications. The inefficiency of the consent regime increases the cost and duration of mortgage transactions. The inadequacy of compensation provisions affects the valuation of land held as security. The persistence of informal customary tenure in rural areas creates risks for lenders extending credit in peri-urban and rural locations. The concentration of power in the Governor introduces an element of political risk into land transactions that is absent in jurisdictions with more decentralised and rule-based systems of land administration.

At the same time, the Act provides certain benefits that are frequently overlooked by its critics. The unification of the tenure system has simplified interstate transactions and provided a common legal vocabulary for the property market. The requirement of Governor’s Consent, while burdensome, provides a mechanism—however imperfect—for state oversight of land transactions and a check against fraudulent alienation. The Certificate of Occupancy, when properly obtained, provides a reliable form of title that is recognised and enforced by the courts. For mortgage professionals, the task is to navigate the Act’s requirements with competence and diligence, while remaining alert to the policy debates that may reshape the legal landscape in the years ahead.

Key Takeaways and Summary

KEY TAKEAWAYSAt independence in 1960, Nigeria inherited a deeply fragmented land law regime comprising customary tenure (approximately 60% of all land), received English law, colonial ordinances, and regional statutes, with pronounced variations across the Northern, Western, Eastern, and Mid-Western Regions.Speculative land acquisition, fraudulent multiple sales, and unequal access to land—particularly in Lagos, Ibadan, and Kano—generated a crisis of land governance during the 1960s and 1970s that was exacerbated by rapid urbanisation and the oil boom.Land prices in central Lagos increased by an estimated 800–1,200% between 1960 and 1975, while land disputes accounted for approximately 40% of the civil docket in Lagos courts by 1974.The Land Use Act (Decree No. 6 of 1978) was promulgated on 29 March 1978 by the military government of General Olusegun Obasanjo, drawing on recommendations of the Land Use Panel (chaired by Justice Oputa) and the precedent of the Northern Nigerian Land Tenure Law of 1962.Section 1 of the Act vests all land in each state in the Governor, to be held in trust and administered for the use and common benefit of all Nigerians—the most sweeping restructuring of property rights in Nigerian legal history.The Act establishes two categories of rights: Statutory Rights of Occupancy (granted by the Governor, evidenced by Certificate of Occupancy, typically 99-year terms) and Customary Rights of Occupancy (granted by Local Government for non-urban land).Governor’s Consent under section 22 is mandatory for all forms of alienation including mortgage; Savannah Bank v.

Ajilo (1989) established that transactions without consent are void ab initio, not merely voidable.Yakubu Ibrahim v.

Simon Obaje (2017) confirmed that subsequent ratification cannot cure the defect of absent consent; consent must be obtained prior to or contemporaneously with the transaction.Adole v.

Gwar (2008) affirmed the constitutional entrenchment of the Act under section 315(5)(d) of the 1999 Constitution, placing it beyond amendment by ordinary legislation.Amendment of the Act requires two-thirds approval in both chambers of the National Assembly plus ratification by two-thirds of state Houses of Assembly—a threshold that has prevented any substantial legislative reform since 1978.Persistent criticisms include: excessive gubernatorial discretion, consent processing delays (3 months to 2+ years), inadequate compensation (improvements only, not land value), and failure to integrate customary tenure realities.Mortgage professionals must treat Governor’s Consent as a non-negotiable element of due diligence; funds should not be disbursed until consent is confirmed, and all title documentation must be verified against the Act’s requirements.

Self-Assessment Knowledge Check

The following ten questions are designed to test comprehension of the material covered in this lesson. Each question presents four options; the candidate should select the single best answer.

1. Which legislative instrument governed land administration in Northern Nigeria prior to the enactment of the Land Use Act?

   1. The Property and Conveyancing Law of the Western Region
   2. The Land and Native Rights Ordinance of 1910 and the Land Tenure Law of 1962
   3. The Registration of Titles Act
   4. The Conveyancing Act of 1881

2. Approximately what percentage of land in Nigeria was held under customary tenure at independence?

   1. 20 per cent
   2. 40 per cent
   3. 60 per cent
   4. 80 per cent

3. By what estimated percentage did land prices in central Lagos increase between 1960 and 1975?

   1. 100–200 per cent
   2. 300–500 per cent
   3. 800–1,200 per cent
   4. 2,000–3,000 per cent

4. The Land Use Act was promulgated under the military government of:

   1. General Yakubu Gowon
   2. General Murtala Muhammed
   3. General Olusegun Obasanjo
   4. General Ibrahim Babangida

5. Under section 1 of the Land Use Act, all land in each state is vested in:

   1. The President of the Federal Republic
   2. The Governor of the state, held in trust for all Nigerians
   3. The Local Government Authority
   4. The traditional rulers of the state

6. In Savannah Bank v. Ajilo (1989), the Supreme Court held that a mortgage created without Governor’s Consent is:

   1. Voidable at the option of the mortgagee
   2. Valid but unenforceable until consent is obtained
   3. Null and void ab initio
   4. Valid provided consent is obtained within twelve months

7. A Statutory Right of Occupancy is granted by:

   1. The Local Government Authority
   2. The Governor of the state
   3. The Federal Ministry of Lands
   4. The traditional ruler of the community

8. In Yakubu Ibrahim v. Simon Obaje (2017), the Court of Appeal held that:

   1. Governor’s Consent may be waived for small transactions
   2. Subsequent ratification by the Governor validates a void transaction
   3. Consent must be obtained prior to or contemporaneously with the transaction; subsequent ratification does not cure the defect
   4. The consent requirement applies only to commercial transactions

9. The Land Use Act is entrenched in the Constitution by virtue of:

   1. Section 44 of the 1999 Constitution
   2. Section 315(5)(d) of the 1999 Constitution
   3. Section 1(3) of the 1999 Constitution
   4. The Second Schedule to the 1999 Constitution

10. Which of the following is NOT a commonly cited criticism of the Land Use Act?

    1. Excessive concentration of discretionary power in the Governor
    2. Delays in processing Governor’s Consent applications
    3. The Act’s failure to vest any land in the state
    4. Inadequate compensation provisions (improvements only, not land value)

Answer Key

Answers: 1. (b) | 2. (c) | 3. (c) | 4. (c) | 5. (b) | 6. (c) | 7. (b) | 8. (c) | 9. (b) | 10. (c)

References and Further Reading

Primary Legislation

Land Use Act, Cap. L.5, Laws of the Federation of Nigeria, 2004 (originally Land Use Decree No. 6 of 1978)

Constitution of the Federal Republic of Nigeria, 1999 (as amended), sections 1, 9, 44, 315

Land and Native Rights Ordinance, 1910 (Northern Nigeria)

Land Tenure Law, 1962 (Northern Nigeria)

Property and Conveyancing Law, Cap. P.21, Laws of Western Nigeria

Conveyancing Act, 1881 (as received in Nigeria)

Registration of Titles Act, Cap. R.8, Laws of the Federation of Nigeria

Case Law

Savannah Bank of Nigeria Ltd v. Ajilo (1989) 1 NWLR (Pt. 97) 305 (Supreme Court)

Adole v. Gwar (2008) 11 NWLR (Pt. 1099) 562 (Court of Appeal)

Yakubu Ibrahim v. Simon Obaje (2017) LPELR-42994(CA) (Court of Appeal)

Abioye v. Yakubu (1991) 5 NWLR (Pt. 190) 130

Ogunleye v. Oni (1990) 2 NWLR (Pt. 135) 745

Secondary Sources

Nwogugu, E.I., Family Law in Nigeria (3rd ed., HEBN Publishers, 2014)

Omotola, J.A., Essays on the Land Use Act (University of Lagos Press, 1984)

Smith, I.O., Practical Approach to Law of Real Property in Nigeria (2nd ed., Ecowatch Publications, 2007)

Umezulike, I.A., “The Land Use Act and the Concept of Deemed Grant” (1990) 2 Journal of Private and Property Law 11

Federal Ministry of Lands and Housing, Report of the Land Use Panel (1978)

Presidential Technical Committee on Land Reform, Final Report (2009)

World Bank, Doing Business 2020: Nigeria (Washington, DC: World Bank Group, 2020)

Nigerian Institution of Estate Surveyors and Valuers, Annual Report on Land Administration (2024)

IMBL of Nigeria, Compliance Manual (2026 Edition)

Page