To put it in a nutshell, a person seeking to persuade a court that they have been in ‘adverse possession’ of land must show that they have had single and exclusive possession of that land, that they had the relevant ‘intention to possess’ the land, and that their possession was adverse to the paper owner (see JA Pye (Oxford) Ltd v Graham [2002]).

However, the High Court decision in Beaulane v Palmer [2005] suggested that the demise of the law on adverse possession was nigh, because the law unfairly deprives landowners of property rights without making any provision to compensate them for the loss of their land.

In Beaulane, discussed more fully by Alison Hardy in issue 148, the High Court felt compelled to recast the definition of ‘adverse possession’ in respect of claims made against a registered proprietor if the Human Rights Act 1998 was in force when the squatter completed 12 years in occupation of the land.

The Human Rights Act came into force on 2 October 2000 so, applying the decision in Beaulane, use of registered land by a trespasser who took possession on or after 2 October 1988 does not constitute ‘adverse possession’ unless the trespasser’s use of the land was inconsistent with the use to which the registered proprietor put, or intended to put, the land. As Nicholas Strauss QC stated (quoting Lord Denning in Wallis v Shell-Mex [1975]):

When the true owner of land intends to use it for a particular purpose in the future, but meanwhile has no immediate use for it, and so leaves it unoccupied, he does not lose his title to it simply because some other person enters on it and uses it for some temporary purpose, like stacking materials; or for some seasonal purpose, like growing vegetables.

Co-incidentally, however, the issue of whether our law on adverse possession contravenes human rights legislation is the subject of an appeal to the European Court of Human Rights in JA Pye, and a decision is expected soon.

So what approach are the courts currently taking? The most recently reported cases on adverse possession confirm that the courts are taking an increasingly tough line against squatters, quite independently of the decision in Beaulane, and that squatters are finding it more and more difficult to bring successful claims for adverse possession of land.

Clowes Developments (UK) Ltd v Walters

In Clowes Developments (UK) Ltd v Walters [2005], a landowner ran into business difficulties and sold his land to a developer on condition that he could continue to occupy it rent free. He was also entitled to receive a percentage of the profits from any subsequent development. After his death, his wife signed a document recording the basis of her occupation as a licensee and agreeing to give vacant possession at any time.

The developer transferred the land to a new owner in 1989, by which time the licensee had moved out of the property, but her daughter and son-in-law – who were never parties to the document that their mother had signed – had moved in. In 2001 the new owner purported to determine the licence to occupy, and brought possession proceedings.

The occupiers claimed to have acquired title by virtue of more than 12 years’ adverse possession. They argued that the transfer to the new owner had terminated their mother’s licence to occupy, and that they had been in adverse possession ever since. The new owner countered the occupiers’ claim by arguing that the parties had intended the licence to continue, despite the change in ownership, with the result that the defendants had never had the necessary ‘intention to possess’ the land.

The High Court found in favour of the new owner. The title to the property was registered and the occupiers had based their claim on the ‘termination’ of their licence to occupy in 1989, so the judge could simply have adopted the rationale in Beaulane, which applies to registered titles where squatters have gone into occupation on or after 2 October 1988. (If the reasoning in Beaulane is strictly applied, the squatter must also have completed 12 years in occupation before 13 October 2003, when the Land Registration Act 2002 introduced a new and tougher regime to deal with adverse possession claims in respect of registered land.)

The judge noted the decision in Beaulane, but chose to focus instead on the occupiers’ intentions to help him decide whether the occupiers had been in ‘adverse possession’ of the land.

The judge ruled that the change in ownership was irrelevant – and reminded the parties that taking or continuing in possession with the permission of the paper owner does not constitute adverse possession. The occupiers had believed that they were in possession because the paper owner had given their mother permission to stay in the property – and she had given them permission to do so, despite her own departure. Consequently, they did not have the necessary ‘intention to possess’ the property to satisfy the requirements for adverse possession (see JA Pye).

It is also interesting to note that the judge would have been inclined to resort to the doctrine of constructive trust ‘no matter how distasteful one might find the element of fiction involved’ to deflect the occupiers’ claims, despite the decision in IDC Group Ltd v Clark [1992]. The judge took the view that to deny the licence a continued life after the change in ownership would be unconscionable, because that would enable the developer to recover mesne profits from the occupiers. So the judge would have been prepared to treat the developer as being bound by a constructive trust to give effect to the occupiers’ rights under the licence, unless and until the developer gave notice to determine them. If that was correct, the occupiers had a lawful right to remain in the property, unless and until the licence was formally determined, and if the developer was precluded from asserting that the occupiers were trespassers, then the occupiers could not assert against the developer that they were ‘dispossessing trespassers’.

Batsford Estates (1983) Co Ltd v Taylor

In Batsford Estates (1983) Co Ltd v Taylor [2005] the disputed land comprised a farmhouse, farmyard and other buildings on an estate. The tenants, who were brothers, agreed to take a tenancy of the disputed land, which was to endure throughout their lives, but the tenancy agreement that was actually executed provided for an annual tenancy.

The landlord served a notice to quit in 1985 but the brothers refused to vacate the property, arguing that they should have been granted a tenancy for life and that their tenancy agreement should be rectified. The landlord decided to leave matters in abeyance until the last brother died in 2000, when the landlord sought possession from the brother’s offspring.

The defendant submitted that his father had acquired title to the disputed land by adverse possession because he had been in possession of it since 1985. The landlord countered by arguing that the defendant’s father had been in occupation of the property with its permission. It asserted that such permission could be implied by virtue of the fact that it had not pursued the notice to quit in 1985 and had allowed the brothers to remain in occupation of the farmhouse.

The Court of Appeal cited the decision in Colin Dawson Windows Ltd v Howard [2005] (see box, left) and the judgment of Etherton J in London Borough of Lambeth v Rumbelow [2001]:

In order to establish permission… two matters must be established. First there must have been some overt act by the landowner or some demonstrable circumstances from which the inference can be drawn that permission was, in fact, given. It is, however, irrelevant whether the users were aware of those matters. Secondly [it must be established that] a reasonable person would have appreciated that the user was with the permission of the landowner.

Their Lordships accepted that the history of events and course of conduct between the parties confirmed that the defendant’s father had remained in occupation of the farmhouse with the consent of the paper owner. They went on to rule that the defendant’s use and occupation of adjoining land had been so inextricably bound up with the use and occupation of the farmhouse that the defendant had had implied permission to use and occupy that adjoining land too.

Brazil v Brazil

In Brazil v Brazil [2005] the claimant and the defendant belonged to separate branches of an old Romany family.

Before his death in 1923, their great-great-grandfather had acquired two adjoining parcels of land, and title to that land had been vested in him until his death. He had numerous children, including the defendant’s grandfather and the claimant’s great-grandfather.

The defendant’s father moved to the site, with his siblings, in 1937 and, following a conveyance to him by his father in January 1993, the defendant successfully registered part of the land in his name as proprietor with possessory title.

The land was ripe for development and the claimant asserted title to the land on the basis that he belonged to the other branch of the family and was in possession of the original deeds conveying the property to his great-grandfather. The claimant commenced proceedings against the defendant, seeking an order for substitution of himself as proprietor with title absolute to that part of the land registered in the name of the defendant.

The High Court judge decided that the defendant had not been in adverse possession of the land because he had been in occupation of the land with other members of his family. He had not granted any of his co-occupiers a licence to occupy, and did not have any superior claim to the property. He had brought the claim in his sole name – the judge did not indicate how he would have dealt with a joint application by all the co-occupiers – and the defendant did not have single and exclusive possession of the land.

The judge also noted that the two families had discussed the future during a family funeral and accepted evidence to the effect that a member of the claimant’s family had agreed that the defendant’s side of the family could stay on the land. The judge reminded the parties that possession based on permission will not support an action for adverse possession – even though the person who granted the permission had no legal title to the property themselves – and ruled that this precluded any claim to adverse possession.

The judge also ruled that a squatter who fails to comply with the terms of their licence may be liable in damages, but the fact that the squatter is in breach of their licence will not start time running against the paper owner by determining the licence, nor convert the licensee’s occupation into that of a trespasser (see also Trustees of Grantham Christian Fellowship v The Scouts Association Trust Corporation [2005], which was decided on almost the same grounds).

Comment

The courts have rejected the squatters’ claims in every case cited in this article, other than Beaulane, principally because the squatters had been given express or implied permission to use and occupy the land.

The European Court will opine on the impact of the European Convention on Human Rights on our law on adverse possession in the very near future, as a result of which we will no doubt have to revisit the decision in Beaulane.

A decision to the effect that the Limitation Act 1980 does unfairly deprive landowners of property rights would have far wider ramifications than any of the cases reported in this article or the judgment in Beaulane, where the judge was careful to restrict his decision to a limited number of cases where squatters have completed 12 years’ occupation of registered land between 2 October 2000 and 12 October 2003.

On the other hand, the European Court could decide that the Limitation Act 1980 does not unfairly deprive anyone of their possessions, or interfere with their peaceful enjoyment of them, because the law exists to ensure certainty of title and to avoid litigation over claims that have gone stale, in which case the decision in Beaulane could have a very short shelf life indeed.

Win or lose, the cases explored in this article suggest that the tide has turned and that the courts are becoming increasingly less sympathetic to squatters’ claims. © Property Law Journal