Why Deed of Assignment is important in every property purchase

Posted by News Express | 20 November 2021 | 646 times

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Purchasing a home in Nigeria entails more than just making payments; you must have proof of ownership, just like any other related transaction. You must have the required paperwork for a property transfer because they are necessary for proving the seller’s ownership interest.

If you don’t have these documents, you could end up in legal trouble with others or the authorities. This is why it is critical that you become acquainted with the many types of property documentation available in Nigeria. And such documents include; Certificate of Occupancy (C of O), Deed of Assignment, Survey Plan, Governor’s Consent and others. But in this article, we’ll get to know more about the document “Deed of Assignment”.

What is a Deed of Assignment?

A Deed of Assignment is a legal instrument that documents a land sale and transfers interest and title in real property from one party to another beginning on the date specified in the document. It is a document that is typically requested by the buyer of real estate at the conclusion of a property transaction, and it must contain particular information in order to be valid and binding on all parties involved in the transaction. When it comes to the transfer of land ownership, a deed of assignment is required.

Characteristics of a Deed of Assignment

The following information is required to be included in every deed of assignment:

The details of the contracting parties like the name and status.

Both parties’ addresses are shown below.

The agreed-upon price for the land and the seller's willingness to accept that price in the end

The background of the area in question. This history could contain everything from how it was first acquired to when it’s set to be sold.

Covenants or pledges that both parties agree to make in order to complete the transfer of the document

The property’s entire description/specifications, including any fittings and fixtures.

The land to be transferred description and size

SURVEY PLAN

Witnesses to the transaction and the signatures of the parties to the assignment

Reason For Deed of Assignment?

A deed of assignment's principal function is to transfer an interest in or assign the title of property from a seller (an assignor) to a new buyer (the Assignee). To serve its goal, a deed of assignment must include the following details we have listed in the characteristics section above.

The Benefit for Deed of Assignment?

Formality: A deed of assignment is a formal contract formed and executed between two parties to a real estate transaction to transfer all the unexpired remainder of land to the other party. It includes not only the fundamental needs, but also the specific terms on which the parties to the transaction have agreed. It serves as a great tool for both parties.

Guarantee: A property lawyer should design a deed of assignment to guarantee that the best interests of the parties to the transaction are properly represented. The assignee’s legal practitioner drafts the deed of assignment, which is then handed to the assignor (vendor) for vetting and execution.

Valid Evidence of Transfer: A deed of assignment is very beneficial since it serves as a valid root of title to the land. It serves as valid evidence of transfer, particularly when the legitimacy of the land is disputed or a third party attempts to claim ownership of the same land.

Steps to Registering the Deed of Assignment in Nigeria

The registration procedure is as follows:

Following the execution of the Deed of Assignment, it must be properly registered and approved by the Governor in compliance with the Land Use Act, LFN 2004.Before the actual alienation or sale of any interest in land in Nigeria, the Governor’s authorization is required. The Land Use Act stipulates that the Governor's consent must be acquired.

@The Governor may, when giving his consent to an assignment, mortgage, or sub-lease, require the holder of a statutory right of occupancy to submit an instrument executed in evidence of assignment, mortgage, or sub-lease, and the holder shall, when so required, deliver the said instrument to the Governor in order that the consent given by the Governor under subsection (1) may be signified by endorsement thereon,” according to Section 22(2) of the Land Use Act. The ability to provide consent can be delegated, as stated in section 45 of the Land Use Act.

In general, after parties to a property transaction execute a deed of assignment, the procedure and steps for registering the executed deed of assignment in Lagos State or any other jurisdiction in Nigeria entail three primary steps: Obtaining Governor’s Consent; Stamping of Deed; and Registration.

Obtaining the Governor’s Consent: When the purchased land is already registered in the seller's name at the registry, the application should be made with the land form 1c available at the land’s registry, and the form should be signed by the purchaser and the vendor. The application form will contain much information to be filled.

Stamping of the Deed: Following the Governor’s approval, the solicitor must guarantee that the transaction's stamp duty is paid. It is recommended that consent be obtained prior to the payment of stamp duties, as the duties paid cannot be recovered if the Governor rejects consent. Stamp duties are levied on a variety of transactions, one of which being the transfer of a property interest. Failure to pay stamp duties has the following consequences:

The instrument will not be registered since it is not in good working order.

According to Section 22 of the Stamp Duties Act, the instrument will be inadmissible in court as evidence.

In the event of late registration, a penalty will be imposed.

Registration: The importance of registering a deed of assignment or conveyance that alienates a land interest is that it is a document affecting land in which one party confers, transfers, limits, charges, or extinguishes a right or title to or interest in land in favour of another party. Although registration does not cure defects in title, a deed of assignment is a registrable instrument that must be registered within 60 days after execution, according to section 25 of the Lagos State Land Instrument Registration Law.

In summary, in any land transaction, a deed of assignment is crucial because it serves as the main document between the original owner and the purchaser, demonstrating that all necessary negotiations have been completed and the purchase price has been paid. In addition, all other important conditions have been achieved by both parties to the transaction; and the owner has transferred all of his rights in the property to the purchaser.

Dennis Isong helps individuals invest right in Real Estate. For questions on this article or enquiring about Real Estate please e-mail: Dennis@Landproperty.ng or Whatsapp/Call +2348164741041

 


Source: News Express

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