In The Supreme Court of Nigeria
On Friday, the 7th day of April, 1995
SC.243/1992
Before Their Lordships
MOHAMMED BELLO Justice of The Supreme Court of Nigeria
IDRIS LEGBO KUTIGI Justice of The Supreme Court of Nigeria
MICHAEL EKUNDAYO OGUNDARE Justice of The Supreme Court of Nigeria
EMMANUEL OBIOMA OGWUEGBU Justice of The Supreme Court of Nigeria
SYLVESTER UMARU ONU Justice of The Supreme Court of Nigeria
YEKINI OLAYIWOLA ADIO Justice of The Supreme Court of Nigeria
ANTHONY IKECHUKWU IGUH Justice of The Supreme Court of Nigeria
Between
AWOJUGBAGBE LIGHT INDUSTRIES LIMITED Appellant
AND
1. P. N. CHINUKWE
2. N.I.D.B LIMITED Respondent
…………………….A……………………
BELLO, C.J.N. (Delivering the Leading Judgment): This appeal raises very important question of law, particularly to bankers, on the validity of a loan and mortgage agreement when the morgagee performed his obligation under the agreement by lending to the mortgagor the sum of N215,000.00 and the mortgagor charged by way of first legal mortgage his property, No. 60-64 Ijebu Road, Ibadan, as security for the loan before the Governor of Oyo State gave his consent for the mortgage under Section 22 of the Land Use Act. The section provides:
“22(i) It shall not be lawful for the holder of a statutory right of occupancy granted by the Governor to alienate his right of occupancy or any part thereof by assignment, mortgage, transfer of possession, sublease or otherwise howsoever without the consent of the Governor first had and obtained:
Provided that the consent of the Governor:-
(a) shall not be required to the creation of a legal mortgage over a statutory right of occupancy in favour of a person in whose favour an equitable mortgage over the right of occupancy has already been created with the consent of the Governor;
(b) shall not be required to the reconveyance or release by a mortgagee to a holder or occupier of a statutory right of occupancy which that holder or occupier has mortgaged to that mortgagee with the consent of the Governor;
(c) to the renewal of a sub-lease shall not be presumed by reason only of his having consented to the grant of a sublease containing an option to renew the same.
(2) The Governor when giving his consent to an assignment, mortgage or sub-lease may require the holder of a statutory right of occupancy to submit an instrument executed in evidence of the 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) of this section may be signified by endorsement thereon.”
