Misuse Of “Power Of Attorney” In Land Transactions

The most popular document in land transactions in Nigeria is“Power of Attorney”. Purchasers and sellers of land have given more powers than the law provided for to power of attorney. Power of attorney is merely a document which authorises a person to act for another as an agent. It is a document of delegation. In it, an owner of a right, power or title can transfer his rights to another person to exercise for him. The owner of the right is referred to as “Donor” while the person to whom it is donated to is referred to as a “donee”/ “attorney”. A power of attorney can be with or without a seal (a red wax or rubber sticker and the words “signed, sealed and delivered”).

 

Practically, a power of attorney begets a master and agent relationship (agency). The master (donor) spells out things that his agent (donee) can do for him. The agent cannot do anything the master has not empowered him to do and the master can withdraw (revoke) his power of attorney. Most people purchase land from sellers who issue only power of attorney as proof of transfer of land title (ownership); that is wrong! It is fraudulent and a perpetual incapacitation that enslaves purchasers, in the eyes of the law.

PROPER USE OF POWER OF ATTORNEY

In Nigeria, apart from land located in the villages under customary ownership, every other land’s transaction must be written. Hence, land transactions (sale and purchase) in the cities require Deed of sale or transaction or alienation. A deed is executed by a seller and a purchaser with the consent of the Governor of the state where the land is located. With the required consent of the Governor, the deed transfers ownership and title from the seller to the purchaser. In most cases, the owner of a land is not often the seller rather the owner empower and delegate his rights to his agents (lawyers, estate managers) with the power to sell land. Such delegation of powers must be specific and written. A typical document that is used to delegate powers from a land owner to his agent is a “Power of Attorney”. Hence, in this context a power of attorney is the channel via which a landowner transfers his powers to his agent. By the powers in a power of attorney, a “done”/“agent” can validly sell a land to any purchaser by preparing a Deed of transfer/sale/alienation in the favour of the purchaser. I urge purchasers peruse all powers of attorney, to verify that they categorically and specifically empower agents to sell. Where a power of attorney has not specified that an agent can sell or delegate his powers to another, he is legally bound not to do such things. And any unpermitted and unpowered sale is invalid. Aside a deed of transfer/sale/alienation, a purchaser needs a power of attorney empowering him to go ahead with the documentation and processes in the Land Registry to perfect transaction.

In the making of a valid power of attorney, a power of attorney must be written and executed by the donor. Where the donor of a power of attorney is an illiterate there must be a “jurat” (a statement that the donor being an illiterate has had the content of the power of attorney read and explained to him in a language he understands, before  affixed his mark/signature.) The name and address of the interpreter and maker of a power of attorney on behalf of an illiterate must be provided on the power of attorney with the date it was made. Any power of attorney made by an illiterate without a “jurat” or the details of the interpreter/maker is invalid. Please, note that only adults of sound mind and registered companies can make a power of attorney and can have a power of attorney made to them. A power of attorney must not be under a seal. Where a power of attorney empowers an agent to make/execute documents that need to be sealed (deed of sale, transfer or any deed), then such power of attorney must be sealed, first. Like most agreements, a power of attorney must be attested/witnessed by at least a witnesses.    

MISUSE OF POWER OF ATTORNEY.

The supreme court of Nigeria has held that “a power of attorney merely warrants and authorises the donee to do certain acts in the stead of the donor and so is not an instrument which confers, transfers, limits, charges or alienates any title to the done: rather it could be a vehicle whereby these acts could be done by the done for and in the name of the donor to a third party.” Culled from UDE V. NWARA (1993)2 NWLR pt.278 or (1993)2 SCNJ p. 47

Hencea power of attorney is an instrument of delegation and not an instrument which confers, or transfers ownership of land. A power of attorney can be used to do what a donor has directed it to be used for, which may be for an outright sale of his land. But such power of attorney cannot be used as a mark, document or instrument of a sale/transfer rather as a license for an agent to sale and not proof of the sale itself.  A power of attorney empowers an agent of a landowner to sell land but is not in itselfa proof of title (ownership) for a purchaser of land.It is a document of delegation and not a document of alienation or transfer of ownership of land. Hence, any purchaser of land should request for a Deed of Transfer or Deed of Sale or Deed of Alienation or any recognised document that transfers title (ownership) and not just a power of attorney.  Unless there is prepared an instrument or document of sale/transfer of ownership of land following the powers vested on the seller by a Power of attorney, there can never be said to be a valid sale or transfer of land.  Where a power of attorney has not specified that an agent can sell or delegate his powers to another, he is legally bound not to do such things for he cannot act outside his delegated powers.

Whether a power of attorney is “revocable” or “irrevocable” it can never be a conclusive document for transfer of ownership to a purchaser.As many Nigerians as that have only power of attorney as their proof of ownership of land; have no good title document and should beware of legal actions. Across Nigeria, many lawyers and estate agents often prepare power of attorney as a conclusive document for transfer of ownership; that is jankara practise and abuse of processes.The Supreme Court described such an act as a “a wrong legal advice” in A.C.B V. IHEKWOABA (2004) FWLR PT. 194, PG 55. Many prefer power of attorney to avoid their payment of higher stamp duties to government not minding the limited use and handicap of a power of attorney. A power of attorney delegates duties to a “donee” and does not on its own stop the owner of the land “donor” from exercising same duties. Hence a power of attorney cannot and will never remove or extinguish the ownership and title of a “donor”(owner of land) to his agent “donee” or any other person that purchases the land.Unless a seller gives a purchaser a deed of sale or transfer he, the seller is still the owner of the land irrespective of the money paid to the seller. Consequently, a purchaser of land who is given only a power of attorney is an agent of the owner of the land or an agent of the agent of the owner of the land while valid ownership/title of land still rests wholly and solelyupon the seller.Such was the decision of the Court of Appeal in AMADI V. NSIRIM (2004) 17 NWLR PT. 901 PG.111.

Hear this; you can never be a true and legal owner of a land to which you possess only a power of attorney to; you are at best an agent of the real owner irrespective of how much you paid the owner. Purchaser should demand deed of transfer/sale /alienation to be given to him by the real owner of the sold land or by his agent (where the agent has a power of attorney empowering the agent to sell and prepare deed of sale on behalf of the owner). Let the name on the certificate of occupancy be same with that of the person signing as the owner/seller of the land. Present owners of land, who posses only power of attorney should endeavour to obtain Deed of sale from their sellers. Prospective purchasers should always demand and obtain Deed of sale as proof of their ownership from their sellers. You own no land if you have only a power of attorney, instead of a DEED OF SALE or TRANSFER!

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Onyekachi Umah

Onyekachi Umah is a private Legal Practitioner with amazing experience in business law, intellectual property, transaction and regulation advisory, corporate, commercial, investment law and energy law as well as litigation and arbitration arising from them. He is a Legal Awareness Expert and also a Certified Arbitrator both in Nigeria and the United Kingdom. He is a member of the Chartered Institute of Arbitrators (UK) and a Certified Conflict Management Practitioner and Negotiator. He is a member of prestigious “Young ICSID” of International Centre for Settlement of Investment Disputes (ICSID), Washington DC. Among other, he has a certificate in Law of Contract from a program of Harvard University, a certificate in International Environmental Negotiation from United Nations Institute for Training and Research, Geneva and recently, a certificate in Conflict Management from United States Institute of Peace, Washington, D.C. He also holds a master of laws degree from University of Jos and he is a doctoral student at the faculty of law, Nassarawa State University. 

Onyekachi is the managing partner of a leading law firm; Bezaleel Chambers International. He is the founder and President of a free law awareness platform known as www.LearnNigerianLaws.com that promotes awareness and understanding of rights and laws of Nigeria (#SabiLaw) and offers free daily law tips (#DailyLawTips). Understanding the challenges of Administration of Criminal Justice in Nigeria, he dedicates his daily law tips every Mondays to promoting Criminal Justice (#CriminalJusticeMonday). Recently, he started a new series on Election Laws tagged (#SabiElectionLaws) to increase legal awareness on elections laws, policies and regulations in Nigeria. He is the convener of the Sabi Law Lecture Series (#SabiLawLectureSeries), travelling around Nigeria delivering free law awareness lectures. He also organises and sponsors a quarterly competition, titled "Sabi Law Video Challenge" (#SabiLawVideoChallenge) where Nigerians win money (over $130.00 per winner) for making videos of themselves talking on any law or right as a way to promote law awareness and have fun. To further promote legal awareness among Nigerians across the world, he started a law awareness show titled "Sabi Law With Onyekachi Umah, Esq" (#SabiLawWithOnyekachiUmahEsq) showing on social media platforms via @LearnNigerianLaws.   

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0 # Anwu Emmanuel Kelech 2016-11-09 19:21
This is a wonderful piece, It in detail explain many misconceptions which wildly and widely held by many Nigeria including the so called elites. I am happy I stumbled on this piece.
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