The Private Wealth & Private Client Review: Nigeria

Introduction

Globalisation has had a significant effect on how people migrate,2 acquire wealth in different parts of the world and become acculturated into the lifestyle of societies other than their ancestral home.3 The world is now said to be a global village where citizens of different cultures and extractions migrate to live and become assimilated into the cultures of other people or places where they may own wealth and establish their permanent residence. Beside the general factors that encourage international migration,4 wealthy citizens have been found to have investment patterns of storing or investing their wealth in other nations or economies other than their nation of nativity or residency.5 International investments are now possible because economies of the world are interdependent, which, more than any time in history, has culminated in the free flow of capital, investment, people, information, technology, goods and services. There has been a drastic shift from national investments and influence to international exploration where people attempt to amass and preserve wealth during their lifetime by acquiring real and personal properties in different parts of the world. Aside from economic interdependence, there is also the embracing of social, cultural and population interaction significantly seen in marriages contracted by people across jurisdictions.

While the effect of globalisation in the private affairs of people is a welcome development, it is not devoid of challenges regarding wealth ownership, management and intergenerational transfer. Globalisation has created a concomitant effect on intergenerational wealth transfer across the world such that there is now a conflict of laws on how wealth domiciled in different jurisdictions should be transferred to succeeding generations.6 Nigeria is a multi-plural society with over 250 ethnic groups.7 There are customary laws and various religious injunctions that Nigerians accept as regulating their way of life that may be brought to bear if they die intestate. Ernest K Bankas, in 'Problems of Intestate Succession and the Conflict of Laws in Ghana', gave insight into a very similar challenge of a conflict of laws in Ghana when he stated:

The important question to ask regarding problems of succession in Ghana is what law should govern the devolution of the estate of a person who has died intestate. The difficulty of choice of law in Ghana often arises from the fact that the intestate has in his lifetime professed Christianity, Islam, patrilineal, matrilineal succession. Thus, when a legal dispute arises, it is often difficult to determine which law will apply.8

The challenge of which law should apply to the estate of a deceased person who died intestate can rear its head in two main dimensions: by intra-national means, which involves a conflict between the customary laws of various ethnic groups in Nigeria, and internationally, which could involve a conflict of Nigerian laws with that of other nations. An intra-national conflict of laws, for instance, would most likely arise where a Nigerian from Gombe, but who resides in Kano, has purchased properties in the Bauchi, Gombe, Plateau, Kano, Jigawa states and the federal capital territory, Abuja. In such instance, the high courts of the various states where a cause of action may have arisen over a person's estate will possess the requisite jurisdiction to hear any matter relating to the administration and distribution of the estate, as stated by the Court of Appeal in Sarki v. Sarki.9

From an international perspective, a conflict may arise when, for example, a Chinese person domiciled in Nigeria for over 15 years marries a Nigerian citizen. If such a person dies without making any testamentary disposition to determine how his or her estate will be administered, there will be a conflict between Nigerian and Chinese laws on the administration of his or her estate, as discussed in detail in subsequent paragraphs. In situations of this nature, and more so in the absence of a testamentary disposition (a valid will or trust instrument), the beneficiaries are mostly faced with the hurdles of determining the applicable law that will govern the administration of the deceased's estate.

According to the Supreme Court of Nigeria, in matters of succession and administration of estates, the lex situs10 is given a predominant role for matters of jurisdiction purposes such that a Nigerian court would ordinarily not assume jurisdiction over foreign property, whether in an international or inter-state matter. Nigerian courts, as an exception, apply the rule to the effect that, where the court has jurisdiction to administer an estate or trust, and the property includes movables or immovables situated in Nigeria and immovables situated abroad, the court has jurisdiction to determine questions of title to the foreign immovables for the purpose of administration.

This has resulted in a very complex system of internal conflict of laws.11 In resolving these controversies, the courts rely on specific facts in the determination of the issues before them. In considering this, questions are asked to determine, inter alia, whether there is a valid will, whether a trust has been created, and whether a customary or a statutory marriage was contracted. These questions are important because they help to determine the applicable laws that will govern the administration of the estate.

In Nigeria, the absence of any form of testamentary disposition automatically brings the administration of the estate within the purview of the administration of estate laws of the various states.12 The nature of the marriage contracted into by the parties also plays a major role in determining whether statute, common law or customary law is applicable. The situation is less cumbersome when the individual dies testate. The more complex situation is in respect of the multijurisdictional administration of estates. Notwithstanding the complexity, and in the absence of a valid will or trust, recourse is made to the personal law that binds the individual and, in the absence of which, the applicable laws where the properties are located will apply.

Tax

The administration of estate laws throughout Nigeria are identical. Tax liabilities attached to different assets and incomes belonging to a person's estate would be determined by the particular tax laws to which the person is subject. Nigeria adopts the residency principle in imposing taxes on the estate of deceased persons; the tax base is rooted in their assets and income, which does not necessarily terminate with the demise of such a person. Where such assets pass on to the estate of the deceased, the estate becomes liable to pay taxes arising therefrom and to pay outstanding tax obligations. Where a person dies (intestate or testate), an application is made to the Probate Registry under which the Registry approves probate or letters of administration. An estate fee of 10 per cent of the assessed estate's value must be paid to the state government where probate is granted. This has become the practice despite the repeal of the Capital Transfer Tax Act 1979. It would appear that the estate fee charged by the probate registries of the various states in Nigeria are calculated pursuant to probate rules in the Civil Procedure Rules of High Courts.

In addition to this, the Personal Income Tax Act (PITA)13 imposes personal income tax on individuals, communities, families and the trustees of an estate.14 There are, however, some provisions of PITA that seek to tax a deceased person. For example, Section 31 provides that in the operation of the pay-as-you-earn scheme, if emoluments are paid by the employer to a deceased's next-of-kin, the employer is to deduct the applicable tax. The Finance Act 2020 has introduced the concept of significant economic presence to the taxation of non-resident individuals, executors and trustees. The effect of this is that profit or income generated from the supply of services to a person resident in Nigeria by an individual who is not resident in Nigeria would be deemed subject to tax in Nigeria to the extent of the non-resident individual's significant economic presence in Nigeria.15

Finally, the federal legislation on taxation of capital transfer is the Capital Gains Tax Act (CGTA).16 This is taxed at a rate of 10 per cent on the gains realised from the disposal of real property. Section 8 (1) of the CGTA states that a deceased person's assets that he or she was competent to dispose of at the time of his or her death are deemed disposed of by him or her on the date of his or her death and acquired by the personal representatives for a consideration equal to the last transfer value or market value of that asset at the time of his or her death. The gains accrued as a result of this deemed transfer is exempt from capital gains tax, and as such the personal representatives or executors on whom the deceased's assets devolve take the asset tax-free for the purpose of capital gains tax. The CGTA further provides that when a legatee or beneficiary acquires the deceased's assets from the personal representatives, there will be no chargeable gain accruing to the personal representatives. This means that the transfer of assets or wealth from the deceased person to beneficiaries under a will or by intestacy is not subject to capital gains tax.17

i International conventions on taxation of estates and treaties domesticated by Nigeria

Tax treaties between countries help to mitigate double taxation problems where the resident country has domesticated its laws such that foreign income is liable to tax in the source country. Nigeria has tax treaties with 14 countries: Belgium, Canada, China, the Czech Republic, France, Italy, the Netherlands, the United Kingdom, Pakistan, the Philippines, Romania, Singapore, Slovakia and South Africa.

Such treaty then further defines who qualifies as a resident of a contracting state to the treaty to include any person who, under the laws of Nigeria, is liable to tax because of his or her domicile, residence, place of management or place of incorporation, or any other criterion of a similar nature, but this definition does not include any person who is liable to pay tax in Nigeria in respect of income or capital gains from sources in Nigeria. What this implies is that for such agreement to apply to a person, the person must be affiliated to Nigeria by way of residence, domicile, place of management or place of incorporation, and not merely by owing property in Nigeria.

Thus, the income on an immovable property may be taxed in the other state. Furthermore, income derived by a resident of a contracting state from immovable property may be taxed in the other state where such income is derived from direct use or letting of the immovable property. It also applies to the income of immovable property of an enterprise. In addition, the business profit from the enterprise of a resident contracting state will not be taxable in both states where such was structured to avoid taxation. Further, gains from the alienation of immovable property in a contracting state may be taxed in the other state.

Finally, double taxation in Nigeria is eliminated where the contracting states in accordance with such agreement, whether directly or by deductions, on profits, income or chargeable gains from sources within the states, shall be allowed as a credit against any Nigerian tax computed regarding the same profits, income or chargeable gains by reference to which contracting tax is computed.

ii How conflict of laws of various jurisdictions in this respect are resolved

A conflict of the laws of various jurisdictions would be challenging to resolve, bearing in mind the possibility of the deceased acquiring assets in different jurisdictions. A concurrent jurisdiction is thus created for the courts of the states where the deceased has real properties.18 The rule that has been applied over time in law is that the courts of states where the real assets of the deceased is located will apply in the administration of the estate of the deceased while the courts of the states where the last known domicile of the deceased possess the requisite jurisdiction to administer the personal properties of the deceased. Therefore, it is important to identify not just the laws that apply to the administration of the estate of a person who died intestate but also to its distribution, as this would form the basis for taxation and what taxes will be payable on the estate.

The philosophy that guides the application of this principle is that since the administration of estates typically concerns the appointment of personal representatives for payment of estate taxes and settlement of debts, the real assets of the deceased can be easily taxed in the state where the property is located. Creditors of the deceased can be most easily traced to his or her last domicile.

Succession

There are generally two sets of laws that apply to the administration of the estate of a deceased who dies intestate where there exists a conflict of law both in terms of customary and statutory law, and the laws of one nation and another. J G Collier states thus: 'A distinction must be made between the administration of an Estate by the personal representatives and its distribution among those entitled to it. Administration includes matters not concerned with the distribution of the estate of the deceased and which arise before distribution takes place.'19 Therefore, it is deductive to state that there is the administration of estate law of a deceased person and the law that governs the distribution of the assets of a deceased person.

Regarding the administration of the estate law of a deceased person, it is the law of the court with jurisdiction that issues letters of administration. Thus, the laws of the state or country that grants the letters of administration will largely dictate how the estate of a deceased person should be administered. This is very important for tax and resealing purposes in law. The law that governs the distribution of the deceased's assets is the law that regulates how the persons appointed as personal representatives of an estate will determine who the beneficiaries of the estate are and how they should be bequeathed or devised.

i Administration of the estate of the deceased

The next critical question for determination is where the administrators should obtain letters of administration. There is no straightforward answer because of the possibility of the deceased acquiring assets in different jurisdictions, which creates a concurrent jurisdiction for the courts of the states where the deceased has real properties.20 The rule that has been applied over time in law is that the courts of states where the real assets of the deceased are located will apply their laws to the administration of the estate of the deceased while the courts of the states of the last known domicile of the deceased have jurisdiction to administer the personal properties of the deceased. This is the contest that the Supreme Court held in the case of Zaidan v. Mohssen thus:

Where, therefore, a person dies leaving immovable property in Warri and is subject to a system of customary law which does not obtain in Warri, the law to govern the succession to his estate is not Administration of Estates Law because Section 1(3) of the Administration of Estates Law is quite clearly against it, but the Muslim law which is binding between the parties. We agree with the learned counsel that this is the rationale of Tapa v. Kuka 18 N.L.R. 5. Just as the Court in Lagos is entitled to apply as between the parties before it a system of Tapa customary law in respect of immovable property in Bida, so can a Mid-Western Nigeria High Court apply Lebanese law to succession to immovable property in Warri in the case of Lebanese parties.21

The Supreme Court of Nigeria has made a clear distinction between the law that governs the administration of the estate of a deceased person and the law that regulates the distribution of his or her estate. The Lebanese law to succession, as used as illustration by the Supreme Court, is the law that will regulate the distribution of the estate of the deceased, while the Rules of the High Court of Mid-Western Nigeria is the law that applies to the administration of the estate of the deceased. It is therefore important to identify not just the laws that apply to the administration of the estate of a person that dies intestate but also its distribution.

The philosophy that guides the application of this principle is that since the administration of estates typically concerns the appointment of personal representatives for the payment of estate taxes and the settlement of debts, the real assets of the deceased can be easily taxed in the state where the property is located, and creditors of the deceased can be most easily traced to his or her last domicile.

ii Distribution of the estate of the deceased

The second issue for consideration is which law will apply to the distribution of the deceased's estate. The applicable law for the distribution of the deceased's estate is the law of the deceased's domicile.22 This can also be regarded as the deceased's personal law. The Supreme Court of Nigeria reiterated the application of the personal law of the deceased to the distribution of the assets of his estate in the case of Onyekwuluje v. Animashaun: 'The applicable customary law when a deceased dies intestate in Yoruba land, even if the deceased died outside his ancestral community, is the customary law of the deceased. In this case, the personal law of the deceased B A Animashaun is Yoruba customary law.'23 The Supreme Court stated herein that the personal law of a person will readily stick with him or her wherever he or she goes. As will be seen below, this position is qualified by the decision of the deceased to choose his or her domicile.

In determining which law will prevail where there is a conflict of laws in the distribution of the estate of the deceased, the court will usually consider evidence before it to determine whether the personal law of the deceased person was changed at any point in time. In the case of Osagwu v. Soldier,24 the issue before the court was which law should apply to the distribution of the estates of persons who are of Igbo extraction who were based in Kano. The Court held that the personal law of the deceased person should apply.25 In the case of Tapa v. Kuka,26 a Nupe Muslim from Bida in the Niger state of Nigeria died intestate in Lagos, leaving property in Lagos. The issue before the court was which law would regulate the distribution of his estate. It was held that it was the personal law of the deceased that should apply to the distribution of his estate.

In Adesubokan v. Yinusa,27 one of the issues before the court was whether the deceased (Yinusa) was a native of Lagos where he was brought up and had resided for many years, or of Omuaran in Kwara state where his father came from. The deceased moved to Zaria, where he lived until his death and had made his will, purporting to dispose of cash and immovable property, some situated in Mushin, Lagos State and some situated in Zaria, Kano state. The living pattern of the deceased and his ancestry made three customary laws applicable to the distribution of the estate of the deceased. The High Court held that testator, as a Muslim native of Omuaran, was subject not to general Muslim law or the Muslim law of a particular school or sect, but to the Muslim law in force in his locality, being Omuaran. The Court took the view that the personal law of the deceased, which is the Maliki Muslim law of Omuaran, should apply to the distribution of the estate, and that the testator should have taken this into consideration when he was writing the will.

On appeal to the Supreme Court,28 it was held that since the deceased made a will pursuant to the Wills Act, the application of the Maliki Muslim law of Omuaran was inapplicable to the distribution of the estate of the deceased. While the judgement of the Supreme Court is binding in this regard, the question that must be asked is whether the decision of the High Court would have been upheld if the deceased had died intestate. We believe so. The personal law of the deceased would have applied to the distribution of his estate.29

The more complex issue is where the lifestyle of the deceased suggests that he or she wishes to belong to another community other than his or her place of ancestry. Judgements of the courts suggest that the domicile of the deceased would be considered in determining whether the deceased had actually changed his or her domicile or personal law. It is therefore also important to consider what is understood as domicile under Nigerian law and how it applies to both succession and matrimonial cases.

In the case of Omotunde v. Omotunde,30 the Court of Appeal defines and explains what is meant by domicile under the law. The Court explained the major types of domicile and reiterated the possibility of a domicile change by an individual.

The different types of domicile relevant for the purpose of this are the domicile of origin, the domicile of choice and the matrimonial domicile.31

Domicile of origin

This is the first type of domicile that everybody acquires. It is the domicile of a person at birth derived from the custodial parents or that imposed by law. Everybody at birth becomes a member of both a political and a civil society: the former determines his or her political status or nationality, and the latter determines his or her civil status. The law that governs the civil society into which he or she is born is the law of his or her country of domicile, is attached to his or her person and remains so attached wherever he or she goes, unless and until he or she ceases to be a member of that society; he or she can only cease to be a member of that society by becoming a member of another civil society, and so acquires a new domicile referred to as the domicile of choice, the law of which becomes attached to him or in that manner.

Domicile of choice

A domicile of choice is established by a physical presence within a state or territory coupled with the intention to make it home. A person over the age of 21 other than a married woman or an insane person may acquire a domicile of choice. To achieve this, two conditions must be fulfilled: residence in the country; and there must be an intention to reside there permanently or at least indefinitely.32

The above exposition of the Court sheds light on the fundamental point that domicile of origin is the law of the place of birth of a person until he or she chooses to belong to another community. In other words, a person is deemed to belong to a particular society until he or she expressly or impliedly acquires the identity of another society, usually after migration.

The Supreme Court of Nigeria was confronted with an issue of change of domicile, or personal law, in the case of Olowu & Ors v. Olowu & Anor.33 The case was instituted by the beneficiaries of one Adeyinka Ayinde Olowu, whose parents were Yoruba indigenes from Ilesha. The deceased lived from childhood until his death in Benin City. He had considerable business interests in Benin City and acquired landed properties as an indigene of that City. He married Benin women and it was clear on the evidence and finding of the trial judge that children born to him were borne by his Benin wives. During his lifetime, he applied to the Oba of Benin34 to be naturalised. Under Nigerian law, the identity change had a far-reaching effect on which customary law would apply to the distribution of his estate. One of the issues before the Court was whether the deceased had been assimilated into the Benin society and accepted the customary laws of Benin. The Supreme Court held that Benin customary law was applicable to the administration and distribution of his estate.

In the Olowu case, the Supreme Court restated the law that mere settlement in a place will not change a person's personal law unless there is sufficient evidence to establish that the person has accepted assimilation into the new society. The settlement of the person in the new place must have been for a long time so as to raise the presumption that he or is already part of that society. Bello JSC has held thus:

Subject to any statutory provision to the contrary, it appears from both cases that mere settlement in a place, unless it has been for such a long time that the settler and his descendants have merged with the natives of the place of settlement and have adopted their ways of life and customs, would not render the settler or his descendants subject to the native law and custom of the place of settlement.

The position of the law stated by the Court of Appeal in Omotunde tallies with the rationale of the Supreme Court in Olowu to the effect that residency in a place and the intention to be permanently resident in a state will raise a very strong presumption that a foreigner has changed his or domicile to the place where he or she is resident.35 According to Kolapo Omidire:36 'in order to effect a change of personal customary law, it has been suggested that we apply analogously the rules of the Common Law concept of domicile to the Customary Law of origin of the properties. Thus, it will be assumed that to change the customary law of origin, overwhelming evidence is required.' Omidire further states that 'a Yoruba man may reside in Igboland for a long time yet may not wish that his personal affairs be made subject to Igbo customary law prevalent in his area of settlement. Thus over- whelming evidence is required to establish that a Yoruba man has acquired the customary law of the Igbo people'37

We submit that the same principle stated above will apply to the distribution of the estate of aliens who have assimilated themselves into any of the indigenous groups in Nigeria. What will be required is evidence to establish that the foreigner seeks to adopt the customary law of a locality where he or she is resident to be applicable to him or her before death.

Wealth structuring and regulation

i Overview

Wealth structuring is defined as an act whereby a person organises his or her wealth through the formation of legally recognised vehicles to better prepare for unknown or future events.38 According to Forbes, wealth structuring creates a platform through which individuals or HNIs can grow, preserve and protect their wealth and pass it to their heirs in a tax-efficient manner in accordance with their wishes. Wealth structuring brings together tax planning, wealth protection, estate planning, succession planning and family governance.39

For proper wealth restructuring, it is imperative to identify and respond to situations that are necessary to guarantee inter-generational preservation of wealth by creating structures that protect assets regardless of their nature, whether movable or immovable. Owners of assets can utilise various mechanisms and instruments not just to rationalise succession but also to maximise resources at any time and whenever possible to obtain more efficient solutions to problems occasioned by little or no planning for the management and distribution of their properties.

ii Estate planning options and regulations

According to Philip K Dick, 'We must content ourselves with the mystery, the absurdity, the contradictions, the hostility, but also the generosity that our environment offers us. It's not much, but it's always better than the deadly, defeatist certainty of the paranoid.'40 These words capture the need to have an estate plan, more so in the light of getting prepared for the inevitable: death.

Wills

One method of estate planning is the making of a will. A will by its very nature is testamentary, that is, it will only take effect after the death of the testator. This notwithstanding, a will can be amended as many times as the testator wishes to do so in his or her lifetime. This is why a will is said to be ambulatory.

Making a will helps the testator to identify the specific beneficiaries of his or her properties. Notwithstanding the advantages of a will, it is fraught with certain challenges that make it disadvantageous to most persons depending on their lifestyle and dispositions. For example, a person who wishes to have his estate plan private might want to consider other options, given the very fact that once a will is lodged in the Probate registry, it becomes a public document. Other challenges include the customary and religious restrictions, for example, the Igiogbe of the Benin Kingdom and the Islamic restrictions.

In Nigeria, upon the death of a testator, estate or inheritance tax at a rate of 10 per cent is paid. This notwithstanding, for the estate owner's properties in a foreign country, estate tax will be charged on those properties. The idea is that, instead of making one will to cover all properties within and outside Nigeria when it is clear that the properties in the foreign country will still be subject to estate tax, it is advisable to make one will covering properties in Nigeria and a supplemental will or codicil covering properties in a foreign country. It is also important to add that these two documents must reference each other to avoid revocation.

Trusts

Another option is setting up a trust. Although there is no specific law that regulates the concept of a trust in Nigeria, in the circumstance, recourse is made to received English law (i.e., the Trustees Act of 1893). The trust is a strategic mechanism of wealth management, a scheme that recent indicators have revealed will help high-net-worth individuals (HNIs) prioritise and maximise the value of their wealth for current and future generations.

A trust establishes a legal relationship between a trustee and beneficiary whereby the trustee (who might be a person or a company) is legally responsible for managing the assets for the benefit of a beneficiary. The property is said to belong to the trustee with the beneficiaries retaining an equitable interest. This helps to relieve the settlor of any liability emanating from the estate because the trustee is now the legal owner of the assets disposed of or covered by the trust.

In addition, the trustee must painstakingly see to it that the settlor's instructions with regards to the management of and distribution of his or her estate are carried out to the letter. One of the advantages of this kind of estate planning is that, if a settlor holds his or her property in a living trust, for example, his or her survivors (beneficiaries) are relieved of having to go through the rigours of probate, which is a time-consuming and expensive process. Setting up a trust makes for a more private disposition of the estate. A trust is also most suitable for estate owners with numerous assets. Further, it makes room for flexibility whereby a settlor can decide what terms should be included in the trust arrangement and how these terms should be implemented. Most importantly, it creates room for tax benefits, especially where an irrevocable trust is created.

Life insurance cover

Life insurance cover as another option for estate planning. This is suitable in situations where a person has young children, owns large assets, or owes significant debts or estate tax when he or she dies. It is tax friendly because life insurance proceeds payable to a named beneficiary pass to that beneficiary free of income tax. It can also be used to make arrangements for funeral expenses and debts of the insured, who in this case is the estate owner.

Financial power of attorney

An alternative to estate planning is making a financial power of attorney. A power of attorney is a document that appoints a person to make decisions on another's behalf. It also helps that a trusted partner, family member or friend, or a person or agency with experience and expertise, can be appointed as an attorney. This appointment will entrust him or her with the responsibility of handling one's finances and property if a person becomes incapacitated and unable to handle his or her affairs.

Setting up a company

Setting up a company structure is also an option for owners of assets. This flows from the fact that a company is made distinct from its owners; therefore, the assets of the company cannot be traced back to the owner. This way, the promoter can determine who the recipients of the dividend accruing from the founder's shares are, and more so if the founder makes provision for it to devolve on his or her beneficiaries. Other alternatives to estate planning include setting up a savings account, joint tenancies and tenancies in common.

Family office

The creation of a family office is another viable option open to an estate owner. A family office, which could take the form of a traditional family office, multifamily office or outsourced family office, is a form of arrangement where a wealthy principal or individual forms a legal entity, and hires a staff whose job is to invest and protect the family's wealth, manage the family's assets and assist with their lifestyle. There are certain factors an individual must consider before going with this estate plan, including the size of an individual's wealth, the complexity of an individual's life and the priorities of an individual's family, to mention a few.

Gifts inter vivos

A gift inter vivos refers to a transfer of property during the lifetime of the donor to another living person called the donee. Such transfer of interest in property may be absolute or conditional, revocable or irrevocable.

The essential elements for the transfer of property by way of a gift inter vivos is the presence of an intention to pass title or interest in the property from the donor to the donee or recipient of the gift, and the delivery and acceptance of the gift by the donee, which allows the donee to have exclusive possession of the property.

Gifts inter vivos can be said to be the best estate planning strategy as they are not subject to probate taxes because they do not form part of the donor's estate upon his or her death. However, where the donee has sold or leased such property (in the case of immovable property), the profit or income accruing from the property may be subject to personal income tax or capital gains tax as the case may be.

It is a very important option as it ensures a long-lasting protection of the assets of the donor or estate owner. In this regard, the donor of the gift can supervise the estate distribution process as the title is transferred during his or her lifetime.

Outlook and conclusions

It should be noted that the migration of Nigerians abroad and the immigration of foreigners into Nigeria will continue to have a significant effect on the intergenerational transfer of wealth by such individuals. The best options available to any person who has wealth in different jurisdictions is to create an effective estate plan – one that gives due consideration to the nature of assets he or she owns, as well as the laws applicable in the jurisdictions where such assets are domiciled. This is important in order to avoid unnecessary bickering among beneficiaries, which in most instances is resolvable only after a heated litigation process.

Footnotes

1 Akhigbe Oserogho and Osasere Osazuwa are senior associates and Temidayo Adewoye, Theodora Olumekor and Juliet Omesiete are associates at Perchstone and Graeys LP.

2 See Cecilia Tacoli and David Okali, 'The Links Between Migration, Globalisation and Sustainable Development', available at https://pubs.iied.org/sites/default/files/pdfs/migrate/11020IIED.pdf; Ramunė Čiarnienė, Vilmantė Kumpikaitė, 'The Impact of Globalization on Migration Processes', Social Research. (2008. Nr. 3 (13), 42–48).

3 Karina Weichold, 'Introduction to Mobility, Migration, and Acculturation' ISSBD (2010), https://issbd.org/resources/files/JBD_nov10.pdf.

4 Sociopolitical, economic and ecological factors are the main forces driving migration. See Mervyn Piesse, 'Factors Influencing Migration and Population Movements – Part 1', Future Directions International Pty Ltd (2014), available at https://www.futuredirections.org.au/publication/factors-influencing-migration-and-population-movements/.

5 Solimano Andrés in 'Global mobility of the wealthy: Push and pull factors' listed four reasons why the wealthy store their wealth in jurisdictions other than their country of residence or nativity. Solimano stated that the wealthy ship their investments abroad in response to new opportunities for profit abroad; to enlarge the scope of their work and attain international recognition; to escape from political, religious or ethnic persecution; and to seek to shield their assets from taxation, financial uncertainty and confiscation policies. See Solimano Andrés, 'Global mobility of the wealthy: Push and pull factors' Doc Research Institute, available at: https://doc-research.org/2019/01/global-mobility-wealthy-push-pull-factors/ accessed on 11 July 2021.

6 See Grahl-Madsen Atle, 'Conflict between the Principle of Unitary Succession and the System of Scission' The International and Comparative Law Quarterly, Vol. 28, No. 4 (October 1979), pp. 598–643; Schulze H C A W, 'Conflicting laws of conflict in cases of international succession' The Comparative and International Law Journal of Southern Africa, Vol. 34, No. 1 (March 2001), pp. 34–47.

7 Mustapha Abdul Raufu, 'Ethnic Structure, Inequality and Governance of the Public Sector in Nigeria' available at https://assets.publishing.service.gov.uk/media/57a08c97ed915d3cfd0014aa/wp18.pdf, accessed 11 July 2021.

8 Bankas E K, 'Problems of Intestate Succession and the Conflict of Laws in Ghana', The International Lawyer, Vol. 26, No. 2 (Summer 1992), pp. 433–465 at 433–4.

9 (2021) LPELR – 52659 (CA).

10 Zaidan v. Mohssen (1973) LPELR-3542(SC).

11 I E Sagay, Nigerian Law of Succession Principles, Cases Statutes and Commentaries (1st ed., 2006, Malthouse Press Limited) at 1.

12 For instance, Section 49 of the Administration Law of Lagos state provides for the order of inheritance when a person subject to the Law dies intestate.

13 As amended in 2011, Cap P8, Laws of the Federation of Nigeria 2004.

14 Section 16 and 27 of the PITA provides that the income of an individual, trustee or executor of a deceased person is ascertained in accordance with the provisions of the Second Schedule of this Law, which charges to income tax any payment or benefit to a beneficiary out of a settlement, trust or estate.

15 There is yet to be a clear definition on what and how significant economic presence would be determined for a non-resident individual, executor or trustee.

16 Cap C1, Laws of the Federation of Nigeria 2004.

17 Section 8 (4).

18 Sarki v. Sarki & Ors (2021) Lpelr-52659(Ca).

19 Conflict of Laws, Cambridge University Press at p. 268.

20 Sarki v. Sarki & Ors (2021) Lpelr-52659(Ca).

21 Zaidan v. Mohssen (1973) LPELR-3542(SC).

22 J Duncan M Derrett, 'India', The International and Comparative Law Quarterly Vol. 9, No. 3 (July 1960), pp. 510–4. Published by: Cambridge University Press on behalf of the British Institute of International and Comparative Law; James Y Stern, Property, Exclusivity, And Jurisdiction Virginia Law Review, Vol. 100, No. 1 (March 2014), pp. 111–81.

23 Onyekwuluje v. Animashaun (2019) 4 NWLR (part 1662) at 242.

24 [1959] N.R.N.L.R., 39.

25 The Court held in Osagwu v. Soldier (above) thus: 'We suggest that where the law of the court is the law prevailing in the area but a different law binds the parties, as where two Ibos appear as parties in the Muslim court in an area where Muslim law prevails, the native court will-in the interests of justice-be reluctant to administer the law prevailing in the area, and if it tries the case at all it will-in the interests of justice-choose to administer the law which is binding between the parties.'

26 (1945) 18 N.L.R. 5.

27 Unreported suit No. Z23/67. Judgment delivered on 30 October 1968.

28 Timothy Tanloju Adesubokan v. Razaki Yunusa (Suit No. S.C. 25/1970) [1971] 10.

29 In Re Estate of Aminatu Alayo, A-G v. Tunkwaselo 18 N.L.R. 88, an Ijebu Mohammedan died intestate. She was married according to Muslim law. The issue before the court was whether the residuary estate should be distributed under Mohammedan law or Ijebu native law and custom. The court held that Muslim law should apply. With the greatest respect to the court, the Muslim law of the deceased should not have applied to prevail over the Ijebu personal law of the deceased, except there is evidence to demonstrate that the deceased wanted her Muslim law to prevail over her personal Ijebu law.

30 Omotunde v. Omotunde (2000) LPELR-10194(CA).

31 ibid.

32 ibid.

33 Olowu & Ors v. Olowu & Anor (1985) LPELR-2604(SC).

34 The head of the Benin kingdom's Eweka dynasty.

35 The decision in Olowu v. Olowu has been hailed as a decision that gives the right for any Nigerian to accept the culture of another indigenous people of Nigeria. Prof I E Sagay in 'The Dawn of Legal Acculturation in Nigeria--A Significant Development in Law and National Integration: Olowu v. Olowu', published in Journal of African Law, Vol. 30, No. 2 (Autumn 1986), pp. 179–89 says at p. 189: 'This decision is unquestionably a “breakthrough” in Nigerian juris- prudence, and is an eloquent testimony to the manner in which law can be utilised as an instrument of social, economic and political development. In this case the Supreme Court has clearly utilised the law as an instrument of social engineering, towards the promotion of national integration in Nigeria.'

36 Change of Personal Law under Customary Law in Nigeria.

37 Kolapo Omidire (1990), 'Change of Personal Law under Customary Law in Nigeria', The International and Comparative Law Quarterly, July, 1990, Vol. 39, No. 3pp. 671-675, p. 674.

38 Wiley Online Library at https://onlinelibrary.wiley.com/doi/10.1002/9781119044871.ch12 accessed on 5 July 2021.

40 The Last Interview and Other Conversations.

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