Who Should Pay Legal Fees: Is It The Tenant Or The Landlord?

By Unini Chioma

Lawyers are often needed in the commencement and termination stages of tenancy relationships, for the good of landlords and tenants. While any person can draft a tenancy agreement, lawyers do it better and lawfully. Please note that it is a criminal offence for a non-lawyer to draft a tenancy agreement or any legal document for a fee (if it is for free it is no offence). Hence, lawyers play a vital role in tenancy relationships and must be paid for their services. So, in practice, I find clients, landlords, tenants and even lawyers, argue; “Who Should Pay Legal Fees of a Lawyer: Is It the Tenant or the Landlord?”. This work answers the question; Who Should Pay the Legal Fees of a Lawyer: Is It the Tenant or the Landlord?

Lawyers and Legal Fees:

Lawyers are mandated to collect legal fees (professional fees) for their services. However, lawyers are also expected to do free legal works for the public good (Pro Bono Publico). Legal fees are often directly proportional to the wealth of lawyers (except for lawyers that may have family trust or other businesses). So, wealth plays a vital role in law practice (like in anything in life). After all, to be elevated to the rank of a Senior Advocate of Nigeria, a lawyer must show that he/she is not impecunious (poor). Also, for lawyers to charge a poor or low legal fee (undercharging) is professional misconduct. This issue of undercharging as professional misconduct is explained in “Effective and Realistic Billing System For Nigerian Lawyers” and accessible for free via https://learnnigerianlaws.com/effective-and-realistic-billing-system-for-nigerian-lawyers/. Hence, a lawyer must strive to be adequately paid for his legal services, when not rendering a free legal service. Lawyers and legal fees are inseparable.

Lawyers, Landlords and Tenants:

Lawyers, landlords and tenants are often not best of friends but they need and rely on each other. While landlords own properties and rent them out to tenants, lawyers protect the relationships between landlords and tenants. Unfortunately, many tenants argue that lawyers only protect landlords (they may be right, especially when and where the lawyers are engaged by landlords and not the tenants). Maybe the theory of “the Piper, the Payer and the Tone” is after all true.

Apart from where the services rendered or to be rendered by a lawyer to a landlord or tenant or both is for free, the lawyer deserves and must be paid an agreed legal fee. Who pays the legal fees of a lawyer is an important part of a tenancy relationship and can spell doom for the entire tenancy relationship.

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Lawyers Fee, Landlords and Tenants:

Tenancy relationships are better when written and signed by parties (Landlords and Tenants). Tenancy agreements are best prepared by lawyers and not any other person. Hence, landlords and tenants need lawyers for the agreements and in turn, lawyers need to be paid for their legal services. So, Who Should Pay the Legal Fees of a Lawyer: Is It the Tenant or the Landlord?

The common opinion on the street of Nigeria and social media is that tenants should pay for the legal fees of lawyers that prepare tenancy agreements. Hence, as new tenants are paying for rent, they are also compelled by landlords to pay for legal fees. There is also a minority opinion out there, that the landlord that receives rent should pay for legal fees from the rent, to avoid further stretching the tenant, financially. These opinions shape tenancy transactions and also lead to dispute avoidance or dispute eruption.

Hear this; there is no known written law in Nigeria that specifies who should pay for legal services, between lawyers and tenants. Payment of legal fees between landlords and tenants has been an issue left for parties to agree on in their tenancy agreements. Parties (landlords and tenants) are free to agree on who pays. Such legal fees could be paid by any of the parties or shared by both parties. So, the common opinion that tenants should pay legal fees of lawyers who drafted tenancy agreements is wrong and unknown to law.

Lawyers Fee and the Tenancy Laws:

Tenancy relationships in Nigeria are guided by the various States Tenancy Laws across States in Nigeria. Apart from Lagos State, most of the various States Tenancy Laws across Nigeria are similar (if not the same). Hence, only the Lagos State Tenancy Laws and the Tenancy Laws for the Federal Capital Territory, Abuja will be considered. So, the Tenancy Laws for the Federal Capital Territory, Abuja represents and reflects the other States Tenancy Laws across States in Nigeria.

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Lagos State is arguably the most legislatively advanced state in Nigeria (it is even more advanced than the entire country, Nigeria). This assertion is better explained in this work; “How Lagos State Is Legislatively Ahead Of Other States” and accessible for free, via this link; https://learnnigerianlaws.com/how-lagos-state-is-legislatively-ahead-of-other-states/. Unlike any other state in Nigeria, the Lagos State has the most recently amended State Tenancy Law (the Lagos State Tenancy Law, 2011). The Lagos State Tenancy Law 2011, unlike other states, expressly frowns at and criminalizes the removal of the roof, locking of doors by landlords that are seeking to frustrate tenants. Also, it has innovative tools for handling recalcitrant tenants and their magic. You can get a free copy of the “Lagos State Tenancy Law 2011”, via this link; https://learnnigerianlaws.com/lagos-state-tenancy-law-2011/.

By section 11 of the Lagos State Tenancy Law, “from the commencement of a tenancy, it is the duty of the party (whether landlord or tenant) that engaged the services of a professional in respect of the tenancy agreement to pay the fees for such professional services”. This means that the law does not specify who should pay legal fees, but ordinarily mandates the person that engages the services of a lawyer or any professional to pay the lawyer (professional). Hence, wherein a tenancy relationship the tenant does not engage a lawyer but the landlord engages a lawyer, then the landlord will pay the resultant legal fees. Also, expectedly, where both the landlord and tenant agree to engage a lawyer, then both will agree on who and how to pay the legal fees.

A visit to the Federal Capital Territory (FCT), Abuja shows that the city has a 76 years old law that governs tenancy relationships in the city. This is also the case in many other states across Nigeria, except in Lagos State. The FCT’s Recovery Premises Act, 1945 governs the relationships between landlords and tenants in the FCT. The FCT’s Recovery Premises Act 1945 is accessible for free via this link; https://learnnigerianlaws.com/free-copy-of-the-recovery-of-premises-act-1945/. In the 20 pages of the FCT’s Recovery Premises Act, there is no provision on payment of legal fees. The law is silent on who pays the professional/legal fees of a lawyer that prepares tenancy agreements for a landlord and tenant. The FCT’s Recovery of Premises Act represents most of the State Tenancy Laws across States in Nigeria (apart from Lagos State), they are also silent on “Who Should Pay the Legal Fees of a Lawyer: Is It the Tenant or the Landlord? Hence, a Landlord and a Tenant in the FCT and other states (excluding Lagos State) have to jointly agree on “Who Should Pay the Legal Fees of a Lawyer” for the party to be bound to pay the lawyer. Where there is no agreement on who should pay a lawyer, no party (landlord/tenant) should be compelled or cajoled into paying a lawyer.

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Conclusion:

Legal services are often expensive, but like education, dealing without legal services is more expensive. Legal fees (professional fees of a lawyer) are to be agreed on ahead of the services of the lawyer. Since, legal fees are often expensive, failing to agree on such could be life-wrecking. There is no known law in Nigeria that specifies Who Should Pay the Legal Fees of a Lawyer. The closest is the Lagos State Tenancy Law, which expressly provides that the party that engages the services of a lawyer, should pay the lawyer.

Contrary to the public opinion in Nigeria to the question; “Who Should Pay the Legal Fees of a Lawyer: Is It the Tenant or the Landlord?”, the question is not answered by any law, convention, practise or norm, rather is answered by the individual agreements of landlords and tenants. It is the agreement between a landlord and tenant that determines who should pay for the legal fees of a lawyer.

Actionable Advice:

  1. Where landlords and tenants wish to engage the services of a lawyer, it is important to agree in writing, who will pay the legal fees of the lawyer.
  2. Even, where there is no agreement on the engagement and use of a lawyer, the party objecting to such legal service should also make his/her objection in writing, to expressly show that he/she will not pay for or share in the paying for legal fees. Feel free to use SMS, WhatsApp and other media for such protests.
  3. Always speak with your lawyer (just like having a family doctor, please get a lawyer)!
  4. Share this work so that we may change the defective common opinion that only tenants must pay for the legal fees of lawyers.

source: thenigerialawyer