THE HARROWING EFFECTS OF THE UNLIMITED CONTINUING LIABILITY OF ORIGINAL LESSEES AFTER EXHAUSTION OF FURTHER INTERESTS IN LEASEHOLD TRANSACTIONS

Abstract

This research aimed at identifying the significance of the principle of privity of contract as a tool for preserving covenants and/or obligations in real property transactions. It was established in the nineteenth century and makes the original parties to the agreement bound by any covenant made for the duration of the period of the contract. The object of this research challenged the continuing liability of the original lessee/tenant where he remains bound by any covenant made for the duration of the contract period. The methodology adopted is doctrinal with primary and secondary sources on law aided by international treaties, textbooks, journal articles, newspapers and online materials. The paper appraised the nature, scope and the application of the principle of privity of contract in a tenancy leasehold relationship and distinguished between the principle of privity of contract and the principle of privity of estate. It assessed the obligations of the original parties under the lease agreement after an assignment of the lease by the lessee or the assignment of the reversion by the lessor and goes further to examine the rationale/justification for the application of the principle. This work evaluated quite extensively the basis for enforcement of covenants in tenancy/leases, the effects of the principle, the remedies open to the parties and the limitations to its application. The discourse also considered ways by which the original lessee can limit, exclude or evade the liability and finally made recommendations, the need for reforms in Nigeria in the context of the modern concept of tenancy and in the light of recent developments in some common law jurisdictions.