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Forfeiture in Leases An Expository Analysis: February 2023
Forfeiture in Leases An Expository Analysis: February 2023
Forfeiture in Leases An Expository Analysis: February 2023
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Emuobo Emudainohwo
Delta State University, Oleh Campus, Oleh, Nigeria
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Introduction
1. Meaning of Forfeiture
5
Black’s: Law Dictionary. 6th edn. For meaning of Lease see Banire, M.A.
Op. cit. See also Black’s: Op. cit.
6
Megarry & Wade: Op. cii. 670. The rule is that a tenant who denies his
Landlord’s title is automatically made liable to forfeit his lease. Makinde v.
Akinwale [2000] 2 NWLR (Pt. 645) 435 at 456 where the Supreme Court
per. Ejiwunmi J.S.C. said where the tenant not only disputes the over lordship
of the title holder but claims title, forfeiture becomes a matter of law for the
court. See also Onyia v. Oniah, (1985)3 NWLR (Pt 11) 1 C.A.
7
Omotola J.A. “Forfeiture in Leases and the Problem of Peaceable Entry”
The Nigerian Law Journal (1986) Vol. 13 p. 2.
8
Megarrv & Wade: Op. cii p. 670.
49
The common Law rule here contrasts sharply with the position
under our Customary Law where the case of customary tenancy,
the overlord possess forfeiture right by implication.9
This common law rule was first clearly stated by Best, C.j. in
Doe D. Wilson v. Philips’10 where he observed that a covenant
in a lease without more entitles the covenantee to obtain specific
performance but not to treat the tease as at end. The rule has
since been established that a lease is subject to forfeiture only if
there is some provision to that effect in the lease and that a lessor
has no right to determine the lease by forfeiture where these
covenants are broken, unless the tease contains an express
provision for forfeiture on breach of covenant’.11
9
Omotola J.Aa Op cit p.2
10
(1824)2Bing l3.
11
Ibid
12
Megarry & Op. cit p.67l, See also Total Oil Great Britain Ltd v. Thompson
Garages (Biggin Hill) Ltd (1972) 1 Q.B. 318.
13
See Omotola J. A. Op cit p. 3
14
Cheshire & Burn’s: Modern Law of Real Property, 18h edn, London.
Butterworths. 409. See also Richard Clarke & Co. Ltd v. WidnalI (1976) 33
P & C.R. 339. where a clause in a lease under which the landlord was entitled
to serve
a notice to terminate in the event of a breach of covenant to pay rent was
construed as a proviso for re-entry. Cf. CIays Lae Housing Cooperative Ltd
50
Provided always that if any part of the said rent shall
be in arrears for 21 days whether lawfully demanded
or not, the lessor or his assigns’ may re-enter the said
premises, and immediately thereupon the said term
shall absolutely determine.
it is now settled that the proviso for re-entry, merely entitles the
Lessor to take some action to forfeit the lease, it does not
terminate the lease automatically upon breach of covenant by
the Lessee. This point was emphasized in the leading case of
Daven Port v. Queen15 by Sir Montague E. Smith while
delivering the opinion of the Privy Council on appeal from the
Supreme Court of Queensland. Sir Smith said:
It is also now accepted that the Lessor must take action to forfeit
the Lease where a breach has been incurred. Thus, in Canas
The rules just discussed are the general rules which apply in all
cases touching on forfeiture. In addition to these rules, however,
there are certain other rules which apply depending on whether
the breach in question is one of non-payment of rent or any other
covenant contained in the lease. For clarity, this will be
separately discussed.
18
(1970) 2 Q.B. 433 OR (1970) 2 All E.R. 795.
19
(Unreported) 1963 S.C. 461/61 of 4/4/63.
20
WACA 37 at 39. See also Majiyagbe v. A.G. 1957 N.L.R. 158
21
Baylis v. Le Gros (1858) 4 C.B (N.S.) 537, Lewis & Son Ltd v. Morelli
(1948) 1 All ER. 433 Cf. Parker v. Jones (1910) 2KB. 32: See further Hill
and Redman’s: Law of Landlord and Tenant. 14th ed. 502 and 508.
52
3. Rent
This was the rigid rule or the Common Law. It required that
where the Lease contained a covenant on the part of the Lesse
to pay rent and the Lessee had made a default, the Lessor must
make a demand for rent within daylight before proceeding to
forfeiture. This Common Law rule was firmly put in Doe D.
Darke v. Bowditch.24 The Courts however recognized that the
parties to the Lease can dispense with the need for formal
demand by making provision to that effect in the Lease. Thus it
is now the practice among Conveyancers to insert the phrase
“whether formally demanded or not” in any forfeiture clause for
non-payment of rent.25 Seeing the hardship posed to the Lessor
by the Common Law rule, the Common Law Procedure Act26
enacted that a Lessor may recover possession under a proviso
for re-entry despite the absence of a formal demand or of the
usual clause excluding its necessity if:
22
21st ed. By Warmington. Vol. 1 (Sources and History of Law of Property)
23
Ibid. p. 276
24
8Q.B. 1140
25
Omotola J.A. Op. cii p.3
26
1852; S. 210
53
to be useful; hence the preference for express provision in the
Lease excluding the Common Law rule entirely.
4. Other Covenants
54
fails within a reasonable time thereafter, to remedy the
breach, if it is capable of remedy, and to make reasonable
compensation in money to the satisfaction of the Lessor,
for the breach.
This provision has been considered both in England and in
Nigeria and the views of the courts appear to be that failure to
comply with the provision of the statute renders a forfeiture
void. In Horsey Estate, Ltd v. Steiger31 the court held that the
giving of notice, where the provision applies, was mandatory
and the notice will be held bad if it is considered too short. Thus
the two day notice given to the Lessee in this case before
commencement of action was held to be insufficient.
31
(1899)2 Q.B. 79
32
Ibid. at 91-92
55
statute clearly contemplates that a reasonable interval shall
elapse offer service of notice and before action”.
33
(1901)2 K.B. 16
34
(196I) I All N.L.R. 409
35
(I988) I NWLR (Pt. 71)48l
56
within the contemplation of S.14(1) of the Conveyancing Act,
1881. This decision was affirmed by the Supreme Court. Agbaje
J.S.C. delivery the lead judgment held thus:36
The Supreme Court also held further that compliance with the
provisions of S. 14(1) of the Conveyancing Act (1881) is a
condition precedent for the success of the action for forfeiture.
36
lbid. at pp. 497-498
37
Abrahams v. Moefishenis Ltd (1912) 2K.B.
38
Scala House & District Property Co. Ltd v. Forbes (1974) Q.B. 575.
39
Rugby School v. Tannahil (1935) 1 K.B. 87
40
(1973)3 AB E.R. 308 at 315
57
The Law of Property Act41 provides, inter alia that (a) right of
forfeiture in a Lease shall not be enforceable unless the Lessor
serves on the Lessee a notice... (b) if the breach is capable of
remedy, requiring the Lessee to remedy the breach.
It has been held, however, that a Lessor need not ask for
Compensation if he does not want it and failure to make such
request will not affect the validity of the notice.44 It must be
made clear that although the provision applies and overrides any
contrary provision in a lease45 it does not apply to Covenants for
payment of rent.46 In the latter case, therefore, where the need
for formal demand has been excluded either expressly or by
statute (i.e. under the Common Law Procedure Act) a Lessor is
free to proceed to forfeiture without notifying his Lessee of the
breach committed by him because of the inapplicability of this
provision to cases of rent. This being so, a Lessee would be well
advised to take his covenant for rent very seriously because not
only may his Lessor retake the land without notice to him, he
may also discover that he cannot even obtain relief from
forfeiture depending on the circumstances of his case.
41
1925 (England) S. 146(1)
42
(1947) 2 All ER. 88
43
Law of Property Act 1925. (England)
44
Lock v. Pearce (1893)2 Ch. 271. Governor of Rugby school v. Tannhill
(1935) 1KB. 87.
45
Section 14(9) Conveyancing Act 1881 and Section 161(11). Property and
Conveyancing Law.
46
Section 14(9) Conveyancing Act 1881 and Section 161(10). Property and
Conveyancing Law
58
5. Relief from Forfeiture.
Rent
47
(1942) 2K.B. 321 at 323
48
(1956)2Q.B. 1 at 13
49
Hill v. Barclay (1811)18 Ves. 56 at 59. 60.
59
Act50 had now imposed a limit on the time within which an
application for relief from forfeiture in cases of non-payment
must be made. The relevant part of the section provides thus:
Other Covenants.
At first there seems to have been some hesitation whether this relief
(grantable in the case of non-payment of rent) might not be
extended to other cases of forfeiture for breach of covenants such
as to repair, to insure and the like where Compensation could be
made but it was soon recognized that there would be great
difficulty in estimating the proper amount of Compensation, and
50
1852 section 210
51
Omotola iA. Op. cit at p.10.
52
Barrow v. Isaacs & Sons (1891) 1 Q. B. 407 at 425
60
since the decision of Lord Eldon in Hill v Barclay53 it has always
been held that equity would not relieve, merely on the ground that
it could give Compensation, upon breach of any covenant in a
Lease except the covenant for payment of rent.
The rule then was that where the breach related to covenant to
pay rent, the Lessee obtained relief if he was ready to pay the
sum due and cost; in other cases, no relief could be granted. The
situation persisted until 1881 when the Conveyancing and Law
of Property Act was passed. Section 1 4(2) of the Act provides:
53
(1811) 18 Ves.56.
54
See Per Lord Coleridge. CJ. in Rogers v. Rice (I 892 2 Ch. 170 at I 71. See
also Cheshire and Burns Modern Law of Real Property. I8th edn. P.415.
61
In Chigbu v. Tonimas55, it was held that “In Lagos State, the
Conveyancing and Law of Property Act 1881-1882 governs
Lessor and Lessee relationship and under that law, relief against
forfeiture of a Lease can only be granted when there has been a
breach of non-payment of rent but there is no provision under
that law for relief against forfeiture in respect of other breaches
of covenants in a Lease”.
In Onyia v. Oniah57 the Court was of the view that relief from
forfeiture is not open to a customary tenant who has denied the
title of his overlord.
55
(1999) 3 NWLR (Pt. 593) 115 at 150 Per Onalaja. J.C.A.
56
Emphasis mine.
57
(I985) 3NWLRur. 11)1.
62
In the case of any action for a forfeiture brought for non-payment
of rent the High Court shall have power to give relief in a
summary manner, and subject to the same terms and conditions
in all respects as to payment of rent, costs and otherwise as can
be imposed by the High Court of Justice in England and if the
Lessee, his executors, administrators or assigns are so relieved
they shall hold the demised premises according to the terms of
the lease and without the necessity of any new lease.58
Also, in Abudu Lasisi & Anor v. Oladapo Tubi & Anor61 Dan
lbekwe, J.S.C. remarked:62
Be it noted also that the court in this country are very slow
in granting forfeiture indeed it will be more correct to say
that in so far as customary tenancy is concerned, our Courts
have always been willing and ready to grant a relief against
forfeiture, except in an extreme case, where refusal to a
giant it would tend to defeat the ends of justice.
58
Cap. 65, 1976 Laws, (Applicable to Delta State). See also S. 21 of the High
court Law of Lagos State. Cap. 60, 1994 Laws.
59
14 NLR 1
60
(1974) l.S.C. B1 at 8.
61
(1974) 12 S.C. 71
62
Ibid. p. 74
63
However, in Asani Taiwo & Ors v. Adamo Akinwumi63 Fatayi
Williams J.S.C. (as he then was) having quoted the statement of
Elias, C.J.N. in Waglireghor’s Case referred to earlier
explained:
63
(1975)4S.C. 143 at 184
64
Omotola J. A. “The Customary Tenant and Transfer of Land in Nigeria”.
(Nigerian Journal of Contemporary Law (1975).
65
OmotolaJ.A. Op. cit 13
66
Megarry & Wade: Law of Real Property 5th edn.
67
Matthew v. Smallwood (1910) ICh 777 at 786, Per Parker J. Dendy v.
Nicholl (1858) 4 C.B. (N.S.) 376
64
Thus, a merely passive attitude on his part has no effect,68 nor
does his failure to take action because he thinks that he will not
be able to prove a suspected breach of covenant;69 but on the
other hand (and this applies to all conditions of forfeiture,
whether in respect of the non-payment of rent or of the non-
performance of other Covenants), a waiver will be implied if a
landlord, with knowledge of the breach.70
In Onyia & Ors v. Oniah & Ors74 it was held that the overlord
with knowledge that the customary tenant had done acts
warranting forfeiture, demanded fresh rents from such tenants
and also brings an action for such rent, the overlord has waived
his right to forfeiture.
68
Perry v. Davis (1858) 3 CB NS 769.
69
Chrisdell Lid v. Tickner (1987) 2EGLR 123.
70
Metropolitan Properties Co. Ltd v. Corderv (1979) 39 P & CR10
(Landlords acceptance of rent for flat with knowledge, through their porters.
of facts which pointed to breach of covenant held to be waiver) Cf. Trustees
of Henry Smith‘s Charity v. Wilson (1983) Q.B. 316; (1983) 1 All ER. 73
(Unconmmunicated rent demand); Official custodian for Charities i’. Parwav
Estate Developments Lid (1985) Ch 151 (1984) 3 All ER. 679 (publication
in London Gazette of Compulsory liquidation held not to be imputed
knowledge so as to constitute waiver).
71
Dendy v. Nicholl (1858)4 C.B. (NS) 376 Clarke v. Grant (1950)1KB 104.
72
Segal Secursues LId 1’. Those by (1963) 1 QB 887.
73
Central Estates (Belgravia) Ltd v. Woolgar (No2) (1972) 1 WLR 1048.
Expert Clothing Service & Sales Lid v. Hill gate House Ltd (1986) Ch. 340
(Profeering of negotiating document held not to be waiver where no
acceptance of rent or demand for rent involved); Church Comrs for England
v. Nodjoumi (1985) 51 P&CR 155 (Service of S. 146 notice held not to be
waiver of right to forfeit Lease on grounds other hand those set out in notice).
74
(1985) 3 NWLR (pt. 11) 1 at 10
75
Doe d. David v. Williams (1835) 7C & P. 322.
76
Ward v. Day (1964)5 B & S 359.
65
It is a question of fact whether money has been tendered and
accepted as rent and its acceptance as such is in Law conclusive
against the landlord. Intention is irrelevant.
77
Windmill Investments (London) Ltd v. Milano Restaurant Ltd (1962) 2
Q.B. 373
78
Law of Property Act 1925 (England) S.148; Property and Conveyancing
Law S.162W
79
Penton v. Barnett (1898) 1 Q.B. 276
80
Doe d Hemnings v. Durnford (1832) 2 Cr & J 667.
81
See the various Recovery of Premises Statutes in different Parts of Nigeria.
See also Smith 1.0. Practical 4ppivacli to Lair of Real, Property in Nigeria.
p. 219.
82
Osho v. Foreign Finance Corp (1991)4 NWLR (Pt 184) 157 at 158.
83
(1987) 1 NWLR (Pt. 50)4l3
66
entitling them to re-enter the state land without recourse to a
court of law as stipulated by the state land law.
Conclusion
Courts have often said parties are bound by their agreement. One
wonders why this is not so in the present law of forfeiture.
84
See Lambo J in Thompson v. Chama (1962) LLR 86.
85
Edict No. 6. Lagos State 1997. See also SS. 7 and 8. Recovery of Premises
Law. Bendel State Laws. Cap. 142 (Applicable to Delta State).
86
Ibid. proviso to S.14 (I). See also S.8 Recovery of Premises Law. Bendel
State Op. cit (Applicable to Delta State).
87
Ibid S.13
88
For example, Rent control and Recovery of Residential Premises Edict No.
6. Lagos State 1997. S.14. See also S.8 Recovery of Premises Law. Bendel
State Op. cit. Applicable to Delta State).
67
with the various Common Law rules or statutes (relating to
forfeiture) before his right to forfeit can be effected.
89
14 N.L.R. 1
90
(1974) 12 S.C. 71.
91
Ibid at 74.
68