A Tale of Due Diligence in Real Estate Transactions
There are many potential hazards and huge risks in the complex world of real estate. Recently, a client engaged the services of our firm, Kleinfeld LP, to handle a property purchase in Abuja, Nigeria. This client is not in Nigeria and is unfamiliar with the subtleties of the local real estate market and would definitely place heavy reliance on our expertise to ensure a smooth transaction. I was assigned the brief, and what followed was a journey that served as a reminder of the critical importance of involving a lawyer in this kind of transactions.
The property appeared promising during my physical inspection, and the seller confidently claimed ownership. However, when I requested the necessary documents from the seller, he provided only photocopies of the title documents. In most government agencies responsible for verifying real estate land, the process requires the submission of original documents. The seller was evasive, citing a joint venture agreement between himself and the party who sold to him. He further claimed that the original documents were safe and would be accessible later, all in the attempt to persuade me that there was no need for further verification.
Well, his assurances were unconvincing. He claimed that other buyers had not required original documents and implied that the estate land status rendered such formalities superfluous. This, of course, raised certain red flags. I am certain that these buyers did not contract the services of a lawyer during their transactions. The lack of verifiable evidence and the insistence on moving forward with the purchase without sufficient documentation were concerning. It was obvious that he was unwilling to facilitate the search. While I did not challenge his claim to ownership, my sole intention was to obtain the requisite documents for verifying the purported ownership with the authorities responsible for land title verification in Abuja.
It is my responsibility as a lawyer to protect the interests of my clients. It would have been a disservice to merely depend on the seller’s assurances of genuineness without more research. It is impossible to exaggerate the significance of carrying out exhaustive due diligence. By insisting on obtaining and confirming the original title documents, we ensure that the property in question is free of encumbrances and that the seller’s claim of ownership is genuine.
This experience highlighted a crucial lesson: involving a lawyer in real estate transactions is not just beneficial, it is essential. Lawyers provide a layer of protection against potential fraud and legal complications. They have the expertise to navigate complex legal landscapes and the vigilance to identify red flags that might be overlooked by those less experienced.
For our client, trusting our judgment was a wise decision. We safeguarded his investment by resisting pressure and taking all essential precautions.
In summary, real estate transactions involve significant risk, and the presence of a lawyer can make the difference between a successful acquisition and a costly mistake. Always insist on thorough verification and never take shortcuts when it comes to legal due diligence. Your future self will appreciate you for doing that.
