Landlord V. Tenant: Available Remedies Where a Tenant Defaults in Paying Rent

Tenant

Introduction

Land is one of the most common property owned. A lot of people buy land and after it appreciates, sell it at a profit while others build houses on their land and rent out spaces. In such situation, the land/ property owner becomes the Landlord while the person occupying such space becomes the Tenant.

Who is a Landlord and a Tenant?

A Landlord is one who lets property to another for an agreed term which is less than his own estate and who is entitled to the reversion of the property at the expiration of the agreed term.

It would be necessary to ascertain if a grant is absolute or one that carries with it a reversion in the grantor. This is because one does not have to own premises to be a landlord, a Tenant can sublet an apartment where his Tenancy Agreement does not prohibit him from doing so.

In Lagos State, tenancy matters are governed by the Lagos State Tenancy Law, 2011, which applies to both residential and commercial properties. However, certain areas such as Ikoyi, Apapa, Victoria Island, and Ikeja GRA are exempt from this law for residential tenancies.

Before discussing the remedies available to landlords when a tenant defaults on rent payments, it is essential to understand a landlord’s rights in property transactions.

Rights of a Landlord in Property Transactions

Landlords have the following rights concerning property transactions in Nigeria;

  1. Right to receive or collect rent: This is the right to collect rent on the apartment that has been rented out to a tenant. The amount payable as rent is mostly stated in the tenancy agreement executed by the parties.
  1. Right not to renew a tenancy: A Landlord has a right not to renew the tenancy, most especially when the Tenant has violated the provisions/clauses stated on the face of the tenancy agreement. Just as the Labour Law principle prevents one to force an employee on an unwilling employer, the law similarly does not impose an unwilling Landlord on a Tenant. The landlord has the right to evict the tenant in the occupation of renting his property.
  1. Right to Not Issue Quit Notice: It should be known that the Landlord has the right not to issue a quit notice when the tenancy agreement is for a certain term (Section 13(5) Tenancy Laws of Lagos State). The effect of the tenancy agreement having a provision for a fixed term means that the Tenant has waived his right to being served a quit notice. 

The effect of the Tenancy Agreement having a provision for a fixed term means that the Tenant has waived his right to being served a quit notice. 

  1. Right to ensure maintenance of the Property: Landlords are entitled to have their property maintained in good condition by the tenant (Section 7(3), Tenancy Laws of Lagos State). The Tenant is responsible for taking reasonable care of the property and preventing avoidable damage, though this responsibility does not extend to events caused by force majeure.
  1. Right to Compensation from Compulsory Acquisition: By virtue of the Land Use Act, the government has the right to compulsorily acquire property for public purposes and infrastructure. However, the landlord has the right to be compensated by the government for such acquisition once the ownership has been confirmed.

Remedies Available to Landlords When a Tenant Defaults on Rent Payment

Despite having a Tenancy Agreement, there are situations where a Tenant would go against such terms contained in the Agreement and refuse to pay for whatever reason. The following are the remedies available to a Landlord who is in a situation where their Tenant has been or is unable to pay their rent;

  1. Demand Notice
  • The landlord is advised to issue a formal demand notice to the tenant, notifying them of the arrears and requesting payment.
  • The notice should state the amount owed, the time period for payment, and possible consequences for non-payment.
  1. Quit Notice
  • If the tenant fails to pay after the demand notice, the landlord can serve a Quit Notice in accordance with the Tenancy Law of their state.
  • The duration of the notice depends on the type of tenancy:
  • Weekly tenancy: 7 days’ notice.
  • Monthly tenancy: 1 month’s notice.
  • Quarterly tenancy: 3 months’ notice.
  • Yearly tenancy: 6 months’ notice.
  • For tenants in default of rent, the landlord may issue a shorter notice if expressly allowed in the Tenancy Agreement.
  • It is of import to note that a Tenant for a fixed term/term certain is not entitled to a Quit Notice.

3. Notice of Owner’s Intention to Recover Possession

  • After the Quit Notice expires, and the tenant remains in the property, the landlord must serve a 7-day Notice of Owner’s Intention to Recover Possession as required by law.
  • A term for a fixed term is only entitled to this notice after the expiration of his tenancy.

4. Recovery of Premises Action

  • If the tenant refuses to vacate after the expiration of all notices, the landlord must file a Recovery of Premises Action at the Magistrate Court within the jurisdiction of the property.
  • The court process ensures that eviction is conducted lawfully, and the landlord may seek the following reliefs:
  • Possession of the property.
  • Recovery of outstanding rent.
  • Mesne profits (Damages for wrongful occupation).

5. Distress for Rent

  • Under the Lagos State Tenancy Law, landlords may recover unpaid rent by distress for rent, which involves seizing and selling the tenant’s movable property to offset the arrears.
  • This remedy must be carried out under a court order and through licensed bailiffs. The landlord is not permitted to execute this without judicial approval.

6. Alternative Dispute Resolution (ADR)

  • The Lagos Multi-Door Courthouse promotes the amicable resolution of landlord-tenant disputes amicably through mediation, offering a faster and more cost-effective alternative to litigation.
  • This approach is particularly advisable because under the Arbitration and Mediation Act, 2023, settlement agreements reached during mediation are legally binding and enforceable in court. In the event of a tenant’s default on the terms of such an agreement, it can be enforced as a consent judgment.
  • As a consent judgment, the Landlord needs the bailiff to evict the Tenant and to further enforce the judgment can institute a garnishee proceedings for recovery of arrears of rent and mesne profits.

Conclusion

Landlords are prohibited from engaging in self-help actions such as forcefully ejecting tenants or locking them out of the property without following the legal process. Such actions are illegal and can result in penalties. To avoid these risks, landlords should adhere to the prescribed legal procedures for evicting tenants and recovering unpaid rent.

Written by Tochukwu

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