Allyson Colby looks at the interaction between adverse possession and the criminalisation of squatting in residential buildings
Key point
- The fact that a trespasser has, at times, committed a criminal offence while squatting in a residential building will not prevent him from acquiring the legal title
Squatting in residential buildings became a criminal offence when section 144 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 came into force. The offence is not retrospective and section 144 does not criminalise squatting that took place before 1 September 2012. However, squatters who remain in possession of residential buildings after that date are liable to prosecution under the new rules.
The legislation was silent about the interaction between section 144 and the law of adverse possession, but the law usually operates on the basis that rights should not be derived from criminal acts. Consequently, we were left wondering whether squatters would be able to acquire title to residential properties if they have committed an offence under section 144. R (Best) v Chief Land Registrar [2015] EWCA Civ 17; [2015] PLSCS 20 answers this question for us, and many others with applications for registration waiting in the wings.
Illegality
The Land Registry considered the first instance decision in R (Smith) v Land Registry [2009] EWHC 328 (Admin); [2009] PLSCS 57 to be the most relevant to this case. In Smith, the High Court rejected a claim that a squatter had established adverse possession of highway land on the ground that it is a criminal offence to obstruct a highway.
The Land Registry applied the same reasoning in Best and rejected the squatter’s application for registration, citing section 144. Mr Best sought to have the decision judicially reviewed. He claimed that section 144 and the law on adverse possession are independent of each other. Who was right? The trial judge ruled that the Land Registry should have accepted, and dealt with, the application for registration and the Court of Appeal has upheld the decision.
Sales LJ, who delivered the leading judgment, tackled the issue of illegality head-on. He noted that the Court of Appeal had upheld Smith ([2010] EWCA Civ 200) on the narrow ground that squatters cannot extinguish public rights of passage over highways, and chose not to rely on the criminal nature of the squatter’s activity. He also drew attention to an observation by Lord Sumption in Les Laboratoires Servier v Apotex Inc [2014] UKSC 55 that, in some exceptional cases, criminal acts will not prevent the acquisition of private law rights. In his view, this was such a case.
Public policy
The Land Registration Act 2002 did not make any changes to the law of adverse possession in relation to unregistered land. In addition, although it makes it more difficult for squatters to acquire title to registered land, it does not actually prevent them from doing so. This is because the law serves a useful purpose. It encourages landowners not to sleep on their rights and brings land that has been abandoned back into use and onto the market by bringing the title back into line with reality.
Section 144 was enacted for different reasons, which had nothing to do with disrupting the delicate and comprehensive balance achieved by the law on adverse possession. It enables owners of residential buildings to evict squatters quickly, with help from the police if needed. The legislation stopped short of criminalising squatting in non-residential buildings and, if the Land Registry were right, this would result in arbitrary distinctions between different types of buildings and activities. Squatters who were well-advised could assume control of residential buildings without actually occupying them and would not move in until they had made good their claim. This would keep land out of economic use, which would conflict with one of the key policy objectives behind the law on adverse possession.
Parliament would not have stayed silent if it had intended to change the law on adverse possession. If the Land Registry were right, the legislature had changed the law significantly without signalling that it was doing so. Alternatively, it had done so by accident, shifting the law in favour of inactive absentee owners and affecting landowners in different and disproportionate ways.
All these factors led Sales and McCombe LJJ to agree that the public policy behind section 144 was not centrally engaged and was outweighed by the policy that underpins the law on adverse possession. However, a case in which a criminal trespasser had bribed a police officer not to expel him, or had murdered the true owner in order to prevent him from reclaiming possession of his property, might be different.
Arden LJ concurred, but on the basis of her interpretation of the relevant statutory provisions and without preferring one statutory policy over the other, or relying on Bakewell Management Ltd v Brandwood [2004] UKHL 14; [2004] 2 EGLR 15. In that case, the House of Lords ruled that there was no public policy bar to the acquisition of prescriptive rights based on user that constituted an offence under section 193(4) of the Law of Property Act 1925, because the user would have been legal, had it been authorised by the landowner.
However, Sales and McCombe LJJ believed that this reasoning could also be applied to the law on adverse possession, because the registered proprietor could have legalised the position by giving the squatter permission to live in the house.
Proceeds of crime
Sales LJ made one further observation that will warm squatters’ hearts. He suggested that there was a reasonable argument that the Proceeds of Crime Act 2002 did not apply to the acquisition of the house (although he did not reach any definite conclusion on this point because it was not relevant to this case).
Allyson Colby is a property law consultant
