The Nigerian construction industry has undergone significant transformation in recent years, with technology playing an increasingly pivotal role in reshaping how construction law is practiced, enforced, and understood. As Africa's largest economy continues to develop its infrastructure, the intersection of technology and construction law has become a critical area of focus for industry stakeholders, legal practitioners, and policymakers alike.

Digital Documentation and Contract Management

One of the most notable technological advancements in Nigerian construction law has been the shift toward digital documentation and contract management. Traditional paper-based contracts are gradually being replaced by electronic agreements that utilize digital signatures and blockchain technology to ensure authenticity and immutability. This transition has significantly reduced disputes arising from document tampering and has streamlined the contract execution process.

The Nigerian Law Reform Commission has acknowledged this shift by incorporating provisions for electronic contracts in recent legal frameworks, recognizing their validity in construction agreements when properly executed and authenticated. Companies operating in Nigeria's construction sector increasingly utilize specialized contract management software to track compliance, manage change orders, and monitor project milestones.

Building Information Modeling (BIM) has revolutionized how construction projects are designed, executed, and legally protected in Nigeria. BIM creates detailed digital representations of physical and functional characteristics of buildings, providing a shared knowledge resource for information about a facility and forming a reliable basis for decisions throughout its lifecycle.

From a legal perspective, BIM has profound implications for liability allocation and dispute resolution. Nigerian courts have begun to recognize BIM models as admissible evidence in construction disputes, allowing for more accurate determinations of responsibility when structural failures or design defects occur. The technology enables precise identification of where errors originated in the construction process, streamlining legal proceedings that previously relied on conflicting expert testimonies and incomplete documentation.

The application of regulatory technology in Nigerian construction law has enhanced compliance monitoring and enforcement. Automated systems now track adherence to building codes, environmental regulations, and safety standards, allowing regulatory bodies to identify violations more efficiently.

The Lagos State Government has been at the forefront of implementing RegTech solutions, deploying digital platforms that automate permit applications, inspections, and compliance certifications. These systems reduce bureaucratic delays and corruption risks while maintaining comprehensive audit trails that strengthen legal enforcement mechanisms.

Satellite imagery, drones, and other remote sensing technologies have transformed how construction sites are monitored for legal compliance in Nigeria. These technologies provide objective evidence of land encroachment, unauthorized construction, and environmental impact—issues that frequently lead to litigation in the Nigerian construction sector.

Recent amendments to Nigerian evidence law have begun to address the admissibility of data gathered through remote sensing technologies, establishing protocols for authentication and chain of custody. This development has particularly benefited cases involving environmental compliance and land use disputes, areas where visual documentation substantially strengthens legal arguments.

Smart Contracts and Automated Dispute Resolution

Though still emerging in the Nigerian context, blockchain-based smart contracts are beginning to appear in construction agreements, particularly for international projects with significant foreign investment. These self-executing contracts with the terms directly written into code can automatically trigger payments when predefined conditions are met, reducing payment delays—a persistent problem in Nigeria's construction industry.

The Nigerian Arbitration and Conciliation Act is currently under review to accommodate technological innovations in dispute resolution, including provisions for online arbitration and the use of smart contracts in construction agreements. This legal evolution acknowledges the growing role of technology in preventing and resolving construction disputes.

Despite these advancements, significant challenges remain. Nigeria continues to grapple with inconsistent power supply and internet connectivity issues that can hamper technology adoption. Legal frameworks sometimes lag behind technological innovation, creating uncertainty around the enforceability of technology-driven solutions.

The future of construction law in Nigeria will likely see greater integration of artificial intelligence for predicting potential legal issues before they arise, expanded use of digital twins for facilities management, and more sophisticated applications of blockchain technology in supply chain management and material verification—all areas with significant legal implications.

The technological advancements in Nigerian construction law represent a profound shift in how legal rights and obligations are defined, monitored, and enforced within the construction industry. As Nigeria continues its infrastructure development trajectory, the symbiotic relationship between technology and construction law will undoubtedly deepen, creating more transparent, efficient, and equitable legal frameworks for the construction sector.

For industry participants, staying abreast of these technological and legal developments will be crucial for maintaining compliance and competitive advantage in Nigeria's evolving construction landscape.

The Technological Advancements of Construction Law in Nigeria  

Nigeria's real estate sector represents a significant portion of the nation's economy, with urban centers like Lagos, Abuja, and Port Harcourt experiencing rapid development and substantial property investments. However, the legal framework governing real estate transactions in Nigeria contains numerous ambiguities and loopholes that continue to create challenges for investors, developers, and everyday citizens. This article examines these laws, their implementation challenges, and the various legal gaps that are often exploited.

Land Use Act: The Foundation with Fundamental Flaws

The Land Use Act of 1978 remains the cornerstone of Nigeria's real estate legal framework, vesting all land within a state's territory in the governor who holds it in trust for the people. While this law aimed to streamline land administration and make land more accessible, several loopholes have emerged over the decades:

The Act requires governor's consent for any property transfer, creating bureaucratic bottlenecks that significantly delay legitimate transactions. This requirement has spawned an informal market of "holding" agreements where parties conduct transactions without officially transferring title—creating legal uncertainty and potential for future disputes.

Additionally, the Act's compensation provisions for land acquisition have proven inadequate, often failing to reflect market values. This discrepancy has led to widespread litigation and resistance to government acquisition projects, with savvy landowners exploiting procedural technicalities to demand higher compensation or delay development projects.

Nigeria's fragmented title registration system varies by state, creating inconsistencies that undermine security of tenure. In many states, multiple registries exist with overlapping jurisdictions, allowing unscrupulous individuals to:

- Register the same property multiple times across different systems

- Create fraudulent documentation that appears legitimate

- Exploit gaps between customary land rights and statutory registration

Lagos State's introduction of electronic Certificate of Occupancy (e-C of O) represents progress, but most states still operate manual systems vulnerable to manipulation and corruption. The lack of a unified national land registry system creates opportunities for double sales and title fraud.

Various states have enacted tenancy laws to regulate landlord-tenant relationships, but enforcement mechanisms remain weak. In Lagos, the Tenancy Law of 2011 prohibits landlords from collecting more than one year's rent in advance for residential properties. However, this provision is routinely violated due to:

- Lack of penalties that effectively deter violations

- Market pressures that force tenants to accept illegal terms

- Limited access to affordable legal remedies

Landlords often circumvent these regulations by structuring agreements as "service contracts" rather than traditional leases, or by demanding substantial "caution deposits" that effectively function as additional rent payments.

Nigeria's mortgage laws contain significant ambiguities that impede the development of a robust mortgage market. The Mortgage Institutions Act and various state mortgage laws establish basic frameworks, but lenders face substantial challenges in enforcing security interests when borrowers default.

Courts have frequently interpreted foreclosure provisions narrowly, requiring lenders to pursue lengthy judicial processes before recovering secured properties. This legal uncertainty contributes to Nigeria's high mortgage interest rates and stringent lending requirements, limiting access to housing finance.

Savvy borrowers exploit procedural technicalities to delay foreclosure proceedings, sometimes for years, while continuing to occupy or derive income from the property. This legal maneuvering reduces the value of real estate as collateral and undermines the entire mortgage system.

Urban Planning and Development Control Loopholes

Nigeria's urban planning laws and building codes exist on paper but suffer from inconsistent enforcement. Developers routinely exploit several loopholes:

- Initiating construction without permits, then seeking retroactive approval

- Obtaining approvals for one purpose, then altering building use without authorization

- Bribing enforcement officials to overlook violations

- Exploiting jurisdictional conflicts between state and local authorities

These practices have led to haphazard development, unsafe structures, and infrastructure overload in many urban areas. Lagos State's demolition of illegal structures represents attempts at enforcement, but these efforts often come too late, after significant investments have already been made.

Nigeria's real estate sector serves as a significant avenue for tax evasion due to valuation ambiguities and enforcement challenges. Property values are frequently understated in official documentation to minimize:

- Capital gains tax on property transfers

The absence of a comprehensive property valuation database makes it difficult for tax authorities to detect undervaluation. Additionally, many high-value properties are held through shell companies or nominees, obscuring beneficial ownership and complicating tax enforcement.

Foreign Investment Restrictions and Workarounds

While Nigeria welcomes foreign investment in real estate, certain restrictions exist that are routinely circumvented. Foreign entities cannot directly acquire land but must establish Nigerian companies to do so. However, loopholes include:

- Creating Nigerian shell companies with nominee directors

- Utilizing irrevocable powers of attorney that effectively transfer control without changing title

- Structuring investments as long-term leases rather than outright purchases

These arrangements create legal uncertainty and potential vulnerabilities for foreign investors, while also allowing circumvention of regulatory oversight designed to protect national interests.

Recent reform efforts have attempted to address these loopholes:

1. The proposed Land Use Act Amendment Bill seeks to streamline consent requirements and improve compensation frameworks

2. The Foreclosure Law in Lagos aims to simplify mortgage enforcement procedures

3. Digital land registries are being implemented in several states to reduce fraud

4. Real Estate Developers Association of Nigeria (REDAN) Bill proposes regulation of developers to reduce fraudulent practices

However, these reforms face significant political and institutional resistance, as many powerful interests benefit from the status quo.

Nigeria's real estate laws contain numerous loopholes that undermine security of tenure, enable fraud, complicate financing, and frustrate urban planning efforts. While these gaps create opportunities for the well-connected and legally sophisticated, they impose substantial costs on the broader economy through reduced investment, higher transaction costs, and suboptimal land utilization.

Comprehensive reform requires not just legislative changes but also institutional strengthening, technological modernization, and cultural shifts in how real estate transactions are conducted. Until such reforms are implemented, investors and participants in Nigeria's real estate market must navigate these legal gaps with careful due diligence and expert guidance to protect their interests.

Real Estate Laws and Their Loopholes in Nigeria

CBN Revokes Union Homes Savings & Loans PLC License:

What Depositors and Stakeholders Need to Know


The Central Bank of Nigeria (CBN) has exercised its regulatory authority under Section 12(1) of the Banks and Other Financial Institutions Act 2020 to revoke the operating license of Union Homes Savings & Loans PLC. This action marks the formal cessation of the institution’s banking operations and triggers a structured liquidation process managed by the Nigeria Deposit Insurance Corporation (NDIC).


As Nigeria’s apex financial regulator, the CBN is charged with maintaining systemic stability, protecting depositors, and ensuring the integrity of the banking sector. License revocation represents one of the most serious enforcement actions available under Nigerian banking law, typically reserved for institutions facing critical financial distress with no viable path to recovery.

1. Legal Framework and Regulatory Authority


Section 12 of BOFIA 2020 grants the CBN broad powers to revoke banking licenses where financial institutions demonstrate persistent inability to meet regulatory requirements. The decision to revoke Union Homes’ license reflects the CBN’s determination that the institution’s financial challenges have reached a critical threshold with no reasonable prospect of remediation.


The CBN may revoke a financial institution’s license based on any of the following circumstances:
•Severe undercapitalization – failure to maintain minimum capital adequacy ratios required by the CBN
•Insolvency or technical insolvency – liabilities exceeding assets with no recovery prospects
•Persistent regulatory non-compliance – repeated failure to submit returns or comply with CBN directives
•Unsafe or unsound banking practices – operations that jeopardize financial system stability
•Prolonged operational inactivity – cessation of core banking activities for six months or more
•Breach of licensing conditions – failure to fulfill obligations imposed when the license was granted


Following license revocation, the NDIC automatically assumes the role of liquidator pursuant to Section 12(2) of BOFIA 2020 and Section 40 of the NDIC Act. The NDIC exercises all powers granted to liquidators under the Companies and Allied Matters Act (CAMA) and operates with a statutory mandate to protect depositors’ interests.



The NDIC processes claims according to the following hierarchy:
1.Depositors – receive first priority in asset distribution
2.General creditors and investors – paid after depositor claims are satisfied
3.Shareholders – last in priority, typically receiving no recovery


The NDIC provides deposit insurance coverage up to a maximum of N5,000,000 per depositor. This protection applies to all eligible deposit accounts held at Union Homes as of the revocation date.
Key timelines:
•Insured deposits (up to N5 million): paid within 30 days of account verification
•Uninsured deposits (amounts exceeding N5 million): paid through liquidation dividends as assets are realized and debts recovered
Required Documentation
To facilitate verification and payment, depositors must provide:
•Valid government-issued identification (national ID, driver’s license, international passport)
•Proof of account ownership (bank statements, passbook, account opening documents)
•Alternative bank account details for electronic fund transfers
•Completed NDIC verification forms (distributed during the verification exercise)
Joint Account Treatment


Where depositors hold both individual and joint accounts, each account receives separate insurance coverage up to the N5 million maximum. For example, if two spouses each maintain individual accounts and also hold a joint account, all three accounts qualify for independent protection, potentially yielding total coverage of N15 million.


While license revocation represents a terminal regulatory action, affected institutions retain limited recourse options:


Union Homes retains the right to seek judicial review of the CBN’s decision before the Federal High Court. However, Sections 12(4), (5), and (6) of BOFIA 2020 impose significant limitations on judicial intervention. Courts cannot compel the CBN to reinstate a revoked license, and judicial review typically focuses on procedural propriety rather than the substantive merits of the CBN’s assessment.
License Reapplication
In cases not involving fraud or gross mismanagement, an institution may theoretically reapply for a banking license after satisfying all deficiencies that led to the initial revocation. However, given the capital requirements and operational standards imposed by current banking regulations, successful reapplication following revocation remains exceptionally rare. Institutions may alternatively seek a downgraded license for more limited financial services operations.


Equity investors and shareholders of Union Homes face severe consequences under the liquidation framework:
Complete Loss of Investment
Shareholders rank last in the claims hierarchy established by Section 2(c) of the NDIC Act. In virtually all bank liquidations, asset realization proves insufficient to satisfy depositor and creditor claims, leaving nothing for distribution to shareholders. Equity investments should be considered total losses upon license revocation.
Loss of Corporate Control
Upon appointment as liquidator, the NDIC assumes full control over the institution’s management, assets, and operations pursuant to Section 585(9) of CAMA. The existing board of directors and management lose all decision-making authority, and shareholders cannot influence the liquidation process.
No Interim Distributions
Unlike depositors who receive prompt payment of insured amounts, shareholders cannot expect any interim distributions during the liquidation process. Only after complete satisfaction of all priority claims—which may take several years—would shareholders become eligible for residual distributions, which historically have proven nonexistent in failed bank liquidations.


License revocations generate ripple effects throughout the banking sector that extend beyond the immediate stakeholders of the failed institution:


High-profile bank failures can erode public confidence in the broader financial system, particularly among depositors of smaller or mid-tier institutions. The CBN’s decisive action, while necessary for systemic stability, may temporarily increase deposit flight toward larger, perceived-safer institutions.


Surviving banks may adopt more conservative lending practices following a peer institution’s failure, potentially constraining credit availability for businesses and consumers. Interbank lending rates may also experience short-term volatility as institutions reassess counterparty risk.


The CBN’s willingness to revoke licenses reinforces its commitment to maintaining banking sector integrity regardless of political or economic pressures. This regulatory assertiveness, while disruptive in individual cases, ultimately strengthens the long-term resilience and credibility of Nigeria’s financial system.


The revocation of Union Homes Savings & Loans PLC’s license represents a necessary, albeit painful, exercise of regulatory authority to protect depositors and maintain financial system stability. While depositors benefit from the NDIC’s insurance protection and structured liquidation process, shareholders and unsecured creditors face substantial losses.
The CBN’s actions underscore the critical importance of continuous regulatory compliance and sound financial management in the banking sector. Institutions operating at the margins of regulatory requirements must recognize that the CBN possesses both the authority and willingness to intervene decisively when financial stability is threatened.
For stakeholders affected by this revocation, timely engagement with the NDIC verification process remains essential to securing available protections and recoveries.



This article is intended for informational purposes only and does not constitute legal advice. For specific guidance on matters related to Union Homes Savings & Loans PLC or other banking regulatory issues, please contact Abayomi Arole Legal Practitioners.

Blog Posts

The Technological Advancements of Construction Law in Nigeria

Real Estate Laws and Their Loopholes in Nigeria

Union Homes License Revocation Article