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OPTION CLAUSE IN A TENANCY AGREEMENT BINDS SUCCESSIVE LESSORS

Dictum

An option clause in a tenancy agreement is a covenant which runs with the land and binds the successors of both the lessor and the lessee in possession. It is immaterial that the lease is not registered provided the lessee has entered into possession and paid the rent pursuant to the agreement, he acquired a legal tenancy. Both parties in such a case are bound by the terms of the agreement and the parties are treated as having the same rights and as being subject to the same liabilities as if a valid lease had been granted. See Manchester Brewery Co. v. Coombs (1901) 2 Ch. 608, p.613.

— Coker, JSC. Okoye v Dumez & Ors. (1985) – SC.89/1984

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WHAT IS CUSTOMARY TENANCY?

A customary tenancy involves the transfer of an interest in land from the customary landlord or overlord to the customary tenant and which interest entitles the customary tenant to exclusive possession of the land and which interest, subject to good behaviour, he holds in perpetuity. Unless it is otherwise excluded, the main feature of a customary tenancy is the payment of tributes by the customary tenant to the overlord. And the status of his exclusive possession is such that it is enforceable against the world at large including even the customary landlord or those claiming through him.

— F. Tabai, JSC. Dashi v Satlong (2009) – SC.303/2002

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MESNE PROFITS & DAMAGES FOR USE AND OCCUPATION

Another area of difference between mesne profits and damages for use and occupation is the date of commencement. Mesne profits start to run from the date of service of the process for determining the tenancy (see Canas Property Co. Ltd. v. K. L. Television Services Ltd. (1970) 2 QB 433. But damages for use and occupation start to run from the date of holding over the property, the function of the court being to ascertain an amount which may constitute a reasonable satisfaction for the use and occupation of the premises held over by the tenant. The previous rent may sometimes be a guide, but may not be conclusive.

– Nnaemeka-Agu, JSC. Petroleum v. Owodunni (1991)

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TENANCY AT WILL COMMENCES AFTER YEARLY TENANCY IF NO RENEWAL

I hold the considered view that from the moment a year’s rent became due and payable by the respondent but remained unpaid, the yearly tenancy, if any, created by the conduct of the parties thereto came to an end by effluxion of time and the respondent thereby became a tenant at will of the 1st appellant by continuing in possession of the property. In law we describe the respondent at that stage as holding over the property and in that capacity it became a tenant at will.

– Onnoghen JSC. Odutola v. Papersack (2007)

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WHEN TENANCY AT WILL ARISES

Pan Asian African Co. Ltd. v. National Insurance Corporation (Nig.) Ltd. (1982) All NLR 229, this court said at page 243: “A tenancy at will arises whenever a tenant with the consent of owner occupies land as tenant (and not merely as servant or agent) on terms that either party may determine the tenancy at any time. This kind of tenancy may be created expressly [e.g. Mansfield and Sons Ltd. v. Botchin (1970) 2 QB 612] or by implication, common examples are where a tenant whose lease has expired holds over with landlord’s permission without having yet paid rent on a period basis (see e.g. Meye v. Electric Transmission Ltd. (1942) Ch 290).”

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RECOGNITION OF TWO CLASSES OF TENANTS

It is now well settled, by decided cases of this court that for the purposes of the Rent Control and Recovery of Premises, the law recognises only two classes of tenants. These are the contractual tenancies, and the statutory tenancies.

– Karibe-Whyte, JSC. Petroleum v. Owodunni (1991)

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THREE MAIN TYPES OF TENANCY

Be that as it may, there are 3 main types of tenancy, tenancy at will, periodic tenancy and fixed term (or term certain). – AMINA ADAMU AUGIE, JCA. Bocas v. Wemabod (2016)

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