Buying Property in Nigeria? Why Investigating Pending Land Disputes Could Save Your Investment
For Nigerians in the diaspora, foreign investors, private equity funds, developers, lenders, and SMEs seeking to acquire land or invest in real estate in Nigeria, title verification extends beyond checking Certificates of Occupancy, Deeds of Assignment, or Governor’s Consent. One of the most overlooked risks in property transactions is acquiring an interest in land that is already the subject of pending litigation.
The Supreme Court’s decision in OHAEGBU & ORS v. REGISTERED TRUSTEES OF THE CAPUCHIN FRIARS MINOR NIGERIA (2022) LPELR-57324(SC) provides a timely reminder of the legal consequences of the doctrine of lis pendens and why comprehensive litigation due diligence is essential before investing in Nigerian real estate.
Understanding the Doctrine of Lis Pendens
The Supreme Court explained that lis pendens means “a pending legal action.” The doctrine operates to prevent parties from transferring the subject matter of a lawsuit to third parties while litigation concerning that property remains unresolved. The objective is to preserve the authority of the court and prevent litigants from frustrating the administration of justice through transfers made during the pendency of a dispute.
According to the Court, the doctrine applies where:
- The lawsuit concerning the property was already pending at the time of the transfer.
- The dispute relates to real property.
- The action seeks to recover, establish, or protect proprietary rights in the property.
- The party against whom the doctrine is invoked had been served with the originating court process.
What Happened in the Case?
The appellants sought to rely on the doctrine of lis pendens to challenge the respondent’s title to the disputed land. However, the Supreme Court held that the doctrine did not apply because the respondent’s predecessor had acquired the land approximately five to six years before the litigation relied upon by the appellants was commenced. Since the acquisition predated the lawsuit, one of the essential conditions for lis pendens was absent. Consequently, the Court affirmed the decisions of the lower courts and upheld the respondent’s title.
Why This Decision Matters for Diaspora and Foreign Investors
Many Nigerians living abroad purchase land, housing developments, agricultural estates, and commercial properties through agents, family members, or local representatives. Likewise, foreign investors often acquire land for manufacturing, logistics, renewable energy, hospitality, and infrastructure projects.
A common misconception is that possession of title documents automatically guarantees ownership. The reality is that an apparently valid title can become the subject of extensive litigation if there are unresolved disputes affecting the property.
The Supreme Court’s decision highlights an important principle: property rights can be significantly affected by pending court proceedings. Investors who fail to investigate litigation risks may find themselves involved in expensive and lengthy disputes after acquisition.
Lessons for SMEs and Growing Businesses
Small and medium-sized enterprises frequently acquire property for warehouses, retail outlets, factories, farms, and office developments. Business owners often focus on commercial terms while paying insufficient attention to legal due diligence.
Before committing capital to any real estate transaction, businesses should determine:
- Whether any court proceedings are pending concerning the property.
- Whether competing ownership claims exist.
- Whether there are subsisting judgments affecting the land.
- Whether the seller possesses a valid and traceable root of title.
- Whether the property is subject to community, family, or customary ownership disputes.
Failure to investigate these issues can expose a business to litigation, project delays, financing challenges, and substantial financial losses.
Practical Due Diligence Checklist for Investors
Before acquiring any real property in Nigeria, investors should:
Conduct title verification
- Review all title documents and ownership history.
- Confirm registration status and relevant governmental approvals.
Investigate litigation risks
- Search for pending court cases affecting the property.
- Review existing judgments and appeals.
- Obtain legal opinions on identified disputes.
Verify the seller’s authority
- Confirm that the seller has legal capacity to transfer the property.
- Examine corporate authorisations where the seller is a company or institution.
Assess community and customary interests
- Verify whether local communities, families, or traditional institutions have competing claims.
Engage experienced legal counsel
- Ensure that due diligence covers both title and litigation risks, not merely document verification.
Key Takeaway
The Supreme Court’s decision in OHAEGBU & ORS v. REGISTERED TRUSTEES OF THE CAPUCHIN FRIARS MINOR NIGERIA (2022) LPELR-57324(SC) serves as a critical reminder that successful property investment in Nigeria requires more than reviewing title documents. Investors must also determine whether the property is affected by pending or historical litigation and whether the seller possesses an enforceable title.
For diaspora investors, foreign investors, developers, lenders, and SMEs, the safest investment strategy is clear: conduct thorough legal due diligence before committing funds. In real estate transactions, discovering a dispute after acquisition is often far more expensive than investigating it before purchase.
A publication of Edidiong Akpanuwa & Co.
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