Introduction
Property owners often bestow gifts on others as expressions of love, loyalty, appreciation, or as a means of distributing assets during their lifetime. Where a gift is not made under customary law, its validity and enforceability depend on the existence of a Deed of Gift between the donor and donee. A Deed of Gift formally records the donor’s solemn and irrevocable intention to part completely with the property and confer it absolutely on the donee. Since a Deed of Gift operates as an estoppel, it prevents the donor from seeking to rescind the covenants contained in it. See: Oyerogba v Olaopa (1998) 13 NWLR (Pt. 583) 509.
The Supreme Court of Nigeria, in Anyaegbunam v. Osaka (2000) LPELR-508 (SC) Pages 23-24 Paragraphs G-B, per Mohammed JSC, defined a gift as follows:
“A gift inter-vivos is an act whereby something is voluntarily transferred from the true possessor to another person with full intention that the thing shall not return to the donor, and with the full intention on the part of the receiver to retain the thing entirely as his own without restoring it to the giver. See Halsbury’s Laws of England. 3rd Edition. vol. 18, page 364 at para 692. The essential thing to consider is that the gift is complete when the donee has accepted it. If that condition is satisfied the donor has no right to revoke the gift. See Dewar v. Dewar (1975) 2 All E.R. 728 at 732.”
When is a Deed of Gift Necessary?
A Deed of Gift is necessary when a donor intends to make a permanent and legally binding transfer of property to a recipient. Most high-value assets have a documentary title, and ownership cannot be proved without reference to that documentation. Accordingly, transferring such assets by way of gift requires a Deed of Gift to vest good title in the donee.
The Court of Appeal in Omoregie v. Bienose (2024) LPELR-58327 (CA) at Page 38 Paragraph C, per Obaseki-Adejumo, JCA, explained the position as follows:
“For a gift to constitute a valid gift inter vivos one must either produce and tender a deed of gift, if the grant was made under English Law, or call his grantor, successor in title or a witness of the transaction to testify at the trial if under customary law.”
A Deed of Gift is particularly useful when a property owner wishes to transfer assets to their beneficiaries during their lifetime, thereby ensuring that those assets do not form part of the donor’s estate upon their demise. Examples of property that may be transferred by Deed of Gift include real estate, factory equipment, vehicles, shares in a company, jewellery, and other valuable items.
A Deed of Gift, when properly executed, constitutes a valid root of title. It is absolute in nature and cannot ordinarily be revoked. In Akume v. Udele (2023) LPELR-60725 (CA), the Court of Appeal rejected the argument that a gift of land was not a recognised method of land transfer in Nigeria, and held that no provision of the Land Use Act, 1978, or any other Nigerian legislation renders a Deed of Gift of land invalid.
A gift may nonetheless be challenged and set aside where its voluntariness is vitiated by fraud, duress, mistake or misrepresentation. The law attaches validity only to gifts that arise genuinely from the donor’s goodwill. In Anyaegbunam v. Osaka (2000) LPELR-508 (SC), the Supreme Court of Nigeria rejected an attempt by a donor who had given a gift of land to an unregistered religious organisation to revoke the Deed of Gift on the ground that he was misled by the trustees of the unregistered religious organisation into giving them the land because he assumed that the religious organisation was a registered one. The Supreme Court upheld the Deed of Gift and held that there was no misrepresentation regarding the religious organisation’s status at the time the Deed of Gift was executed.
Additional Requirements for Gifts of Land
Donors and donees dealing with land should be aware of the need to register their title at the Land Registry of the State where the land is located in a process known as perfection of title. A Deed of Gift of land is one of the documents or instruments that are mandatorily required to be registered at the Land Registry, as any gift of land made without the Governor’s Consent is void. This means that parties should therefore ensure that an application for Governor’s Consent is made and obtained promptly after the execution of the Deed of Gift.
Essential Elements of a Valid Gift
The following are the essential elements of a valid Deed of Gift:
- Legal Capacity of the Donor: The donor must have the legal capacity to execute the Deed of Gift and must be of sound mind at the time of execution. A deed executed by a person lacking mental capacity may be voidable.
- Clear and Voluntary Intention: The donor must have a clear, voluntary and unconditional intention to permanently divest themselves of the property. Any element of compulsion, fraud, or misrepresentation will undermine the validity of the gift.
- Delivery of the Property: The donor must either deliver the property or take steps to formally transfer the property or the subject matter of the gift to the donee. For real estate, this is effected through the Deed of Gift and the ancillary perfection steps. It should be noted that delivery is a distinct act from acceptance and must precede or accompany it.
- Acceptance by the Donee: The donee must accept the gift from the donor. As the Supreme Court confirmed in Anyaegbunam v. Osaka (Supra), the gift is only complete upon acceptance, after which the donor has no right of revocation.
- Absence of Consideration: A Deed of Gift must not contain any consideration from the donee. Consideration is the hallmark of a Contract of Sale or Deed of Assignment, and its presence in a Deed of Gift would recharacterise the transaction. Therefore, the transfer through a Deed of Gift must be gratuitous.
- Witness: The Deed of Gift must be witnessed by an individual who was present and saw the donor executing the Deed of Gift.
- Accurate Description of the Property: The Deed of Gift must accurately identify the property being transferred to the donee, including its description, size, location and any other particulars necessary to avoid ambiguity or dispute.
Conclusion
Although customary law permits an oral gift of real estate provided it is made publicly and possession of the property is handed over to the donee, relying on custom alone exposes both parties to uncertainty, especially if a dispute arises. A properly drafted and registered Deed of Gift provides the clearest and most defensible proof of the donor’s intention and the donee’s title.
For donors, the Deed of Gift ensures that the transfer is complete and irrevocable during their lifetime. For donees, it is the foundation of a legally secure title that can withstand scrutiny in future transactions or litigation. Accordingly, parties intending to make or receive gifts of property should instruct their solicitors at the outset, so that the full process from drafting to perfection is properly managed.
Please note that this article is for general information only. We do not offer it as advice on any particular matter, whether legal, procedural or otherwise. If you have questions about this article, please contact:
Faruq Abbas (Managing Partner): foa@abdu-salaamabbasandco.com.
Nurudeen Emmanuel (Partner):nemmanuel@abdu-salaamabbasandco.com.
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