CERTIFICATE OF OCCUPANCY vs DEED OF ASSIGNMENT: All you need to know

There are various title documents in property transactions but in this article we shall be looking at the Certificate of Occupancy and the Deed of Assignment.

A Certificate of Occupancy

A Certificate of Occupancy (C of O) is a legal document issued by the government that grants an individual, group of individuals, or corporation the right to possess and occupy a particular parcel of land for 99 years, for any purpose. The State Governor of Nigeria, where the land is situated, is authorized to issue a certificate of occupancy under Section 9 of the Land Use Act 1978. The paragraph states that “the Governor may act lawfully if an individual is entitled to a statutory right of occupancy; proof of such right of occupancy must be provided with the Certificate.” One unique feature of the Occupancy Certificate is that it is the primary document issued for land that hasn’t been previously listed in the Land Registry, whether it is developed or undeveloped. Two Certificates of Occupancy cannot be held concurrently by any Nigerian land.

A Deed of Assignment

An important legal document that documents a land sale and transfers ownership and interest in real property from one party to another as of the document’s commencement date is a Deed of Assignment.

The significance of the occupancy certificate

With various important ramifications, a Certificate of Occupancy (C of O) is an essential legal document in Nigeria that certifies land ownership and title. Proof of Ownership: Providing legal protection against disputes, it is the most widely accepted form of evidence for land ownership in Nigeria.

1. Investment Security: It gives property owners peace of mind

2. Credit Access: For loans and mortgages, financial institutions frequently demand a C of O.
3.Transfer of Ownership: A C of O attests to the legality of real estate transactions.
4. Land Development: It’s essential to follow land-use laws and apply for development permits.
5. Legal Protection: Land disputes and illegal encroachment are prevented by the C of O.
6. Appreciation of Value: In the market, properties with a C of O are frequently worth more.
7. Protection Against Fraud: It aids in the avoidance of fraudulent land transactions.
8. Urban Planning: It is used by the government to plan cities and develop infrastructure.
9. Legal Compliance: Maintaining a C of O requires paying property taxes and following rules.

Importance of Deed of Assignment

• Transfer of Ownership: It legally conveys property rights from the seller to the buyer.
• Legal Validity: Without a proper Deed, property transfers may be invalid.
• Proof of Title: It ensures the buyer acquires a valid and marketable title.
• Protects Buyer’s Interests: It includes warranties from the seller.
• Financial Transactions: Lenders require a registered Deed for property loans.
• Land Use and Development: Authorities need it for approving land development.
• Legal Disputes: It is a critical document in property-related litigation.
• Registration: Registration of the Deed provides public notice and legal status.
• Tax Implications: It is necessary for tax compliance.
• Succession Planning: It is used for transferring property to heirs or beneficiaries.

Differences Between a Certificate of Occupancy and Deed of Assignment

• A C of O is granted by the State Governor or a minister in the case of FCT, signifying a right to occupy land for 99 years from the date of issuance. In contrast, a Deed of Assignment transfers the seller’s residual interest without reversionary interest and does not reset the 99-year term.
• A Deed of Assignment establishes the seller’s ownership, while a C of O certifies the holder’s sole possession.
• A Deed of Assignment cannot be revoked; however, the Governor’s consent is necessary for its perfection. Conversely, a C of O can be revoked for public interest under Section 28 of the Land Use Act.
• The Deed of Assignment is the preferred document when other interests are present on the property, rather than a C of O.

Details Found in a C of O

• Property details: Address, size, survey plan, and identification number.
• Landowner’s information: Name, contact details, and photograph.
• Property usage: Intended use and any restrictions.
• Title details: Title information and acquisition method.
• Government approvals: Confirmation of approval and compliance.
• Encumbrances: Any limitations on the property.
• Duration: The validity period of the C of O.
• Seal and signatures: Government seal and authorized signatures.
• Serial number and date: Unique serial number and issuance date.
• Purpose: Specified use (residential, commercial, etc.).
• Special clauses: Any additional conditions.

Details Found in a Deed of Assignment

• Participants’ details: Names, addresses, and status.
• Transfer date: When the property was transferred.
• Assignor’s title: Legal right to sell.
• Property description: Details, including fixtures.
• Title history: Chain of ownership and documentation.
• Document evidence: Verification of the property’s documents.
• Transaction amount: Sale price and acknowledgment of payment.
• Transaction nature: Terms and seller’s authority.
• Signatures: Parties’ and witnesses’ signatures are required.
• Survey plan: A detailed survey layout.
• Lawyer’s information: Details of the lawyer preparing the deed.

In conclusion, both documents are very important in a real estate transaction depending on the scenario.