Understanding the Deed of Assignment: Your Key to Secure Real Estate Transactions.

Last week, we delved into the significance of the survey plan as a crucial real estate document. Today, we'll be discussing the deed of assignment in detail.

Let's start by clearing up some common misconceptions:

1. No, the deed of assignment is not a land title.

2. Yes, the deed of assignment is an essential document in land transactions.

3. No, it must not be omitted. It's vital to have a deed of assignment for your land purchase.

4. No, a deed of assignment cannot be substituted or represented by a contract of sale.

4. No, A deed of assignment is not the same as a deed of conveyance.

Like every other real estate concept or terminology, there are many questions surrounding the deed of assignment. I've encountered cases where supposed landowners were only provided with a contract of sale to validate their land purchase. And yes, I intentionally used the term "supposed."?

…….here’s why

A deed of assignment is the only legal document that transfers the right of ownership of a parcel of land from the seller to the buyer. While all real estate documents are important, each serves a specific role. The deed of assignment's duty is to legally make you the owner of the land or property. So, if all you have is a contract of sale, proving your ownership in court will be incredibly challenging, if not impossible.

This article aims to demystify the concept and importance of the deed of assignment, and highlight key aspects to consider.

Shall we begin??

What is a Deed of Assignment?

A deed of assignment is a legal instrument used to transfer interest, rights, and title of a property from the assignor (seller) to the assignee (buyer). This document is typically prepared by a legal practitioner and must be duly signed by both parties. It is a vital part of property transactions, ensuring that the buyer legally acquires the property.

Significance of a Deed of Assignment

1. Transfer of Land Ownership

The deed is essential for legally transferring the right of ownership of the parcel of land from the seller to the buyer. This document is usually prepared by the buyer's lawyer and then reviewed by the seller's lawyer to ensure all agreed-upon details are included. In cases where the property is part of an estate, the seller's lawyer might prepare the deed for the buyer's lawyer to review, ensuring all parties are on the same page.

2. Legal Root of Title:

The? deed of assignment provides a valid and recognized basis for the property's ownership. If any disputes or competing claims to ownership arise, this document acts as proof that the land was transferred properly and legally, thus protecting the buyer’s claim to the property.

3. Legal Proof of Ownership:

The deed serves as concrete legal evidence of ownership transfer. By detailing all the terms and conditions of the transaction, it clarifies who the rightful owner of the property is. This legal clarity is essential for both parties, providing the buyer with assurance of ownership and the seller with a clear record of the transaction.

4. Protection of Rights:

By documenting the transfer of property rights, the deed of assignment protects the interests of both the buyer and the seller. For the buyer, it guarantees full legal claim to the property, free from any disputes. For the seller, it offers a clear record of the transfer, preventing any future claims of ownership and ensuring a smooth transition of property rights.

?5. Required for Land Title Registration:

The deed of assignment is a prerequisite for registering the title of the property with the relevant government authorities in Nigeria. Without this document, obtaining a Certificate of Occupancy (C of O) or Governor’s Consent, which are essential for validating property ownership, is impossible. Thus, the deed of assignment not only secures the transaction but also facilitates the legal recognition and registration of the property.

Components of a Deed of Assignment:

For easy understanding, an ideal deed of assignment comprises of four parts;

1. The Introductory Part: it covers the preliminary matters such as?

• Commencement date: This highlights the date the contract becomes binding.
• Parties :There are usually two parties: the seller (assignor) and the buyer (assignee) parties. The name, address and status of the parties must be included.?
• Recitals: This part covers the historical background of the land acquisition by the seller. It explains how the seller (assignor) acquired the parcel of land and it usually includes the date of purchase and the cost.

2. The Operative Part: This is where the interest of? the property is formally transferred from the buyer (assignor) to the seller (assignee), serving as the core of the deed of assignment. This section typically begins with the testatum and includes crucial clauses such as the consideration (price) of the property, acknowledgment of receipt by the assignor, a detailed description of the property, and the terms and conditions of the transaction.

3. The Miscellaneous Part: This section encompasses all the covenants agreed upon by the parties involved such as the covenant for indemnity, which ensures protection against potential losses or damages. It also includes the acknowledgment for the production and an undertaking for custody.

4. The Concluding Part: This is the final section of the deed and it is very vital to the entire transaction. It entails;

• The testimonium which indicates that all parties are involved in the transaction.
• Execution ; it refers to the signing by the parties, who sign in their respective capacities.?
• Attestation. This involves the witnessing of the execution of the deed by witnesses.

In addition, this section includes provisions for endorsement for the Governor’s consent, in accordance with Section 22 of the Land Use Act. It mandates that the Governor’s consent must be obtained before assigning or transferring any statutory right of occupancy.

Every part of a deed of assignment plays an essential role in ensuring it is a complete and binding document. Before signing a deed of assignment , make sure that all sections are thoroughly inspected and every critical detail is included. This ensures the document is valid and enforceable.

Types of Deed

Notice how I didn’t say “types of deeds of assignment.”??

A deed is a legal document that transfers ownership of property from one party to another. It is a crucial element in real estate transactions, providing proof of ownership and outlining the rights and obligations of the involved parties.

In the real estate market, there are several types of deeds, each serving different purposes and offering varying levels of protection.?

One well-known type is the deed of assignment, but it's not the only one. Here are some other types of deeds you might encounter:

1. Deed of Conveyance

A deed of conveyance is a legal document that officially transfers ownership of property from one person to another. It is commonly used in the sale of real estate and includes details about the property, the price, and any terms and conditions of the sale.

2. Deed of Gift

This type of deed is used when property is given as a gift. It involves no exchange of money but transfers ownership from the donor to the recipient. The deed of gift must clearly state that the transfer is made voluntarily and without any consideration.

3. Deed of Lease

A deed of lease is used to grant a tenant the right to use and occupy property for a specified period. It outlines the terms and conditions of the lease, including the duration, rent, and responsibilities of both the landlord and the tenant.

4. Deed of Mortgage

This deed is used when property is pledged as security for a loan. It gives the lender a legal claim to the property if the borrower fails to repay the loan. The deed of mortgage outlines the terms of the loan and the conditions under which the property can be claimed by the lender.

5. Deed of Release

A deed of release is used to release a party from their obligations under a previous agreement, such as a mortgage. Once the obligations are fulfilled, this deed formally removes the lien or claim on the property, clearing the title.

6. Deed of Trust

In some jurisdictions, a deed of trust is used instead of a mortgage. It involves three parties: the borrower, the lender, and a trustee. The trustee holds the property title as security for the loan and transfers it to the lender if the borrower defaults.

7. Deed of Rectification

This type of deed is used to correct an error in a previously executed deed. It ensures that the details in the original document accurately reflect the intentions and agreements of the parties involved.

8. Deed of Sublease

A deed of sublease is used when a tenant (the original lessee) decides to lease out part or all of the rented property to another party (the sublessee). This document outlines the terms of the sublease, including the duration and rent, and must comply with the terms of the original lease agreement.

9. Deed of Partition

This deed is used to divide property among co-owners. It outlines how the property is divided and ensures that each party gets their fair share. This is commonly used in cases where property is inherited by multiple heirs? or joint owners have decided to sever their joint ownership and have individual allotted and clearly defined shares.

Each type of deed has its specific role and significance in property transactions. Understanding these deeds is vital for ensuring that property dealings are legally sound and properly documented.

What’s Included in a Deed of Assignment

In a typical deed of assignment in Nigeria, you would find the following detailed:?

• The names, addresses, and status of all parties involved in the transaction.
• The date when the property was transferred from the vendor to the buyer.
• The vendor's (assignor’s) title and the nature of their ownership.
• A complete description of the property, including any fittings and fixtures.
• The property's history, tracing its ownership from the initial acquisition to the current sale, along with all previous documentation.
• Information about a verifiable document related to the property.
• The purchase price paid for the property and the vendor’s agreement to the sale price.
• The nature of the transaction and the vendor’s role (assignor).
• The signatures of both parties and their witnesses.
• The survey plan of the property.
• Details about the lawyer who prepared the deed.
• The Governor’s assent, which must be signed and validated.

How to Obtain a Deed of Assignment in Nigeria

1. Consult a Real Estate Lawyer

Start by engaging a qualified real estate lawyer. They will ensure your Deed of Assignment is comprehensive, legally sound, and will guide you through each step of the process.

2. Gather Necessary Documents

You will be informed of the required documents by your lawyer, this generally includes:

• Proof of ownership from the seller (assignor)
• Sale agreement between the buyer (assignee) and the seller
• Detailed property information and a survey plan
• Identity documents for all parties involved

3. Lawyer Drafts the Deed

Based on the agreed terms and submitted documents, your lawyer will draft the Deed of Assignment, ensuring it covers all legal aspects and specific details of the transaction.

4. Review and Sign

Both the buyer and the seller, along with their respective lawyers and witnesses, will review the Deed of Assignment thoroughly. Once all parties are satisfied, they will sign the document.

5. Obtain Governor’s Consent

After the Deed of Assignment is signed, it must receive the Governor’s consent to be valid. This step involves submitting the document for approval and may require additional fees.

6. Register the Deed

Once you have the Governor’s consent, the final step is to register the Deed of Assignment with the relevant land registry office. This ensures the transfer is officially recorded and legally recognized.

By following these steps diligently, you can ensure a smooth and legally sound transfer of property ownership in Nigeria.

Ways to ensure you have a Valid Deed of Assignment

1. Engage a Competent Lawyer: Always work with a qualified legal practitioner who specializes in property law.

2. Verify Seller’s Ownership: Conduct due diligence to confirm that the seller is the rightful owner of the property.

3. Check for Encumbrances: Ensure that the property is free from any legal encumbrances, such as mortgages or pending litigation.

4. Register the Deed: After execution, ensure that the deed of assignment is registered with the relevant land registry.

Key things to note about a deed of assignment

• A deed validates your ownership; without it, your rights to the land are not secure and cannot be defended in court.
• The template of a deed varies depending on the lawyer.
• A Deed of Assignment is not the same as a Deed of Conveyance: A Deed of Assignment transfers specific rights of a property from the seller to the buyer, while a Deed of Conveyance transfers all rights of the property to the buyer. For example, if you purchase land in an estate, the developer may retain certain rights, such as dictating rules of occupancy. In contrast, with a Deed of Conveyance, the seller relinquishes all rights to the property, giving the buyer complete ownership and the freedom to use the land as they please.
• A deed of assignment is not the same as a contract of sale, neither can it be replaced by the same. a contract of sale only spells out the terms and conditions of the transaction while a deed legally transfers the rights of ownership from the buyer to the seller.
• A minor, defined as an individual under 21 years of age, cannot independently participate as a party in a Deed of Assignment. In cases where a minor is intended to be a party to a Deed of Assignment, an adult must be appointed as the legal guardian of the minor to act on their behalf in the transaction.
• The cost associated with obtaining a Deed of Assignment in Nigeria differs based on several factors, primarily influenced by the property's value and the lawyer's expertise. Here are key considerations that impact the overall expenses:

1. Complexity of the transaction: The intricacies involved in the property transfer process can affect the total cost of drafting and processing the Deed of Assignment.

2. Lawyer’s location and reputation: Legal fees can vary depending on where the lawyer practices and their reputation within the legal community.

3. Negotiation with the lawyer: Engaging in negotiations with the lawyer regarding their fees and the scope of services provided can also influence the final cost of obtaining the Deed of Assignment.

• In cases of co-ownership, it is essential that the full names of all co-owners are accurately spelled out. Each co-owner must sign the document on the last page to validate their ownership rights. This ensures the document's legality and affirms each co-owner's stake in the property.
• Without proper registration, the legal standing of the deed is questionable, which can lead to disputes and complications in the future.
• There have been instances where fraudulent deeds of assignment are used to claim ownership of properties illegally. It is crucial to verify the authenticity of all documents and work with trusted legal professionals.

Understanding the deed of assignment is fundamental for anyone involved in property transactions in Nigeria. It is not just a formality but a critical document that secures legal ownership and protects the rights of all parties involved. By paying attention to the details and ensuring proper legal procedures are followed, you can navigate the complexities of property ownership with confidence.

Ensure to seek professional guidance from licensed lawyers to accurately draft or interpret the deed..

Did you find this insightful? The goal of these newsletters is to equip you with the necessary knowledge to safely and successfully navigate the real estate market. I hope you feel more enlightened with each edition.

As always, I look forward to your comments and questions.

Till I write you again, Do stay safe.

Warm Regards,

Tomi Samson.

______

To kickstart your real estate investment journey, make inquiries or book a consultation, kindly click on the link below.

https://calendly.com/tomisamsonrealty/book-a-call-with-tomi