A rent increase can put a tenant in a difficult position, particularly where the landlord proposes a substantial increase shortly before the tenancy is due for renewal. This raises an important question: Can a tenant refuse a rent increase in Nigeria? The answer depends on whether the increase is being proposed during an existing tenancy or in connection with a new tenancy, what the tenancy agreement provides, and the law applicable to the property. In Lagos State, the Tenancy Law 2011 provides a specific remedy for an existing tenant who considers an increase in rent unreasonable. Under Section 37, the tenant can apply to court for an order declaring the increase unreasonable, subject to the terms of the tenancy agreement. The court considers factors including the general level of rents in the locality or a similar locality, evidence from the parties and any special circumstances relating to the premises. A tenant therefore should not simply assume that every rent increase must be accepted, but neither should a tenant assume that every increase is automatically unlawful. Can a Landlord Increase Rent in Nigeria? Generally, a landlord can propose an increase in rent, subject to the terms of the existing tenancy agreement and any applicable law regulating the tenancy. The important question is when and how the increase is being imposed. A landlord cannot simply treat an existing tenancy as though it were a new tenancy and demand a different rent in the middle of an agreed fixed term unless the tenancy agreement or applicable law permits the increase. For example, if a tenant has paid ₦2 million for a one-year fixed tenancy running from January to December, the landlord cannot ordinarily announce in June that the rent has increased to ₦3 million and demand the additional ₦1 million immediately, unless there is a contractual or legal basis for doing so. The position is different when the existing tenancy is coming to an end and the landlord proposes a new rent for a new tenancy. Can a Tenant Refuse to Pay the Increased Rent? Yes, a tenant can refuse to accept the proposed increase. But the legal consequences depend on the circumstances. A tenant’s refusal does not automatically mean that the landlord has committed an offence or that the tenant has acquired an indefinite right to remain in the property at the old rent. If the existing tenancy has expired and there is no contractual right to renewal at the previous rent, the landlord can decide not to grant another tenancy at that rent. On the other hand, where the increase is imposed during an existing tenancy contrary to the tenancy agreement, or where the applicable law gives the tenant a right to challenge an unreasonable increase, the tenant has stronger grounds to contest it. Can a Landlord Increase Rent During an Existing Tenancy? The answer depends primarily on the tenancy agreement. If the agreement is for a fixed term at a specified rent and contains no rent review provision, the landlord ordinarily cannot unilaterally rewrite the agreement and impose a new rent before the agreed term expires. For example, if the agreement provides for a fixed annual rent of ₦2 million for a two-year term, the landlord cannot ordinarily increase the rent to ₦3 million after the first six months simply because property values have increased. However, some tenancy agreements contain rent review clauses. Where a valid rent review clause exists, the landlord’s right to increase the rent must be exercised in accordance with the clause. The tenant should therefore read the agreement before deciding whether an increase is lawful. What If the Rent Increase Is Proposed When the Tenancy Is Being Renewed? This is different from increasing rent during an existing fixed term. At the end of a fixed tenancy, the landlord and tenant can negotiate the terms of a new tenancy, including the rent. If the tenant has no contractual right to renew at the old rent, the landlord can generally propose a new rent as a condition for entering into a fresh tenancy. The tenant can reject the proposed rent. However, rejecting the new rent does not necessarily give the tenant a right to remain indefinitely at the old rent. The tenant must consider whether: the existing tenancy has expired; there is an option to renew; the renewal clause specifies how rent is to be determined; the landlord has validly determined the tenancy; and the landlord has complied with the applicable recovery-of-premises procedure. This is why a dispute about a rent increase at renewal can sometimes become a renewal and possession dispute, rather than simply a rent dispute. Can a Tenant Challenge an Unreasonable Rent Increase in Lagos? Yes. This is expressly provided for by Section 37 of the Lagos State Tenancy Law 2011. Section 37(1) provides that, subject to any agreement to the contrary, an existing tenant can apply to court for an order declaring that an increase in rent payable under the tenancy agreement is unreasonable. This is an important statutory protection. It means that where an existing tenant considers a proposed increase unreasonable, the tenant does not have to rely solely on negotiation with the landlord. The tenant can seek judicial determination of the reasonableness of the increase. What Does the Court Consider When Determining Whether Rent Is Unreasonable? Section 37(2) of the Lagos State Tenancy Law identifies factors the court is to consider. These include: 1. The General Level of Rent in the Locality The court can consider what comparable properties in the same locality are being rented for. This is important because a landlord cannot establish that an increase is reasonable merely by asserting that the property has become more valuable. Evidence of comparable rents can assist the court in determining whether the proposed rent is excessive. 2. Evidence of the Parties The court can consider evidence presented by both the landlord and tenant. This can include evidence relating to the property, the existing rent, the proposed increase and comparable rental values.