It is trite law that, if unregistered land is adversely possessed for a period of 12 years, the title of the paper owner is automatically barred under section 15 of the Limitation Act 1980, write Mark Pawlowski and James Brown
Where the land is registered, however, there is no automatic barring of title by adverse possession – instead, after being in adverse possession for a minimum of 10 years, the adverse possessor can apply to be registered as the proprietor in the absence of any objection by the paper owner. If, however, there is an objection, the possessor will not be registered unless he falls within one of the three exceptional grounds listed in paragraph 5 of Schedule 6 to the Land Registration Act 2002 (the 2002 Act).
Given the limited nature of these exceptions, many adverse possessors will be advised to avoid the risk of applying for registration altogether if this would alert the registered proprietor of their existence and prompt a successful opposition to the application. Indeed, the incentive to “stay quiet” is made even more attractive given the principle of relativity of title in English property law and the possibility of the transmission of possessory rights between possessors, creating, in effect, a “dark market” in possessory rights falling outside the registered land system.
Transmission of possessory titles
Apart from highlighting the principle that possession is good against all but the true owner, the well-known case of Asher v Whitlock (1865) LR 1 QB 1 demonstrates that a possessory title is capable of transmission on death either by will or on an intestacy. Moreover, because adverse possession gives all the rights and powers of ownership, the possessor acquires, to all intents and purposes, a legal estate in fee simple absolute in possession subject only to the true owner’s paramount right to recover the land until such time as their title is extinguished by limitation.
Apart, however, from devolution by will or intestacy, it is apparent that an adverse possessory right in land can be sold or gifted: Mount Carmel Investments Ltd v Peter Thurlow Ltd [1988] 3 All ER 129; Buckinghamshire County Council v Moran [1989] 2 All ER 225. It is also possible for periods of adverse possession to be added together to make up a full possessory title.
The wording of Schedule 6, paragraph 11(2)(a) of the 2002 Act clearly recognises that a possessory right is transmissible from one adverse possessor to another. In the same way, a possessory title of 12 years can be built up in unregistered land: Willis v Earl of Howe [1893] 2 Ch 545; Ellis v Lambeth London Borough Council [1999] EGCS 101. So long as the period of adverse possession is continuous, the adverse possession of successive trespassers may be lumped together to defeat the paper title to the property: Lambeth London Borough Council v Bigden [2000] All ER (D) 2076.
Possessory titles and first registration
A transfer of possessory rights (whether by gift or sale) to a successor in title will trigger an application for first registration. Here again, however, there may be good reason why the squatter would not wish to apply for first registration as this would have the potential of alerting the registered proprietor of the existence of the squatter and prompt a claim to recover possession of the land. Indeed, this has been recognised recently in the Law Commission’s consultation paper, Updating the Land Registration Act 2002 (2016), where it is stated that “there may be little incentive for an adverse possessor to register a… title [because] doing so may draw attention to his or her claim to the land and, therefore, prompt the registered proprietor to commence proceedings to bring the adverse possession to an end.”
The three exceptional grounds
If an objection to the possessor’s application for registration is received in time, the possessor will not be registered unless the case falls within one of the three exceptional grounds listed in paragraph 5 of Schedule 6 to the 2002 Act.
The first ground (paragraph 5(2)) is that it would be unconscionable because of an equity of estoppel for the registered proprietor to seek to dispossess the applicant and the circumstances are such that the applicant ought to be registered as the proprietor.
The obvious difficulty here is that a possessor who occupies land under circumstances giving rise to a proprietary estoppel is unlikely to be in adverse possession. If the registered proprietor encourages the possessor to occupy the land, then presumably this would suggest that the possessor is occupying with the former’s consent.
The second ground (5(3)) is that the applicant is for some other reason entitled to be registered as the proprietor of the land. Although expressed in broad terms, the ground appears to be limited to cases where, for example, the possessor is entitled to the land as a beneficiary under a will or on intestacy of the previous registered proprietor, or where a purchaser has gone into possession after paying the purchase price but without a formal transfer of the title. According to the Land Registry, this second ground is rarely successfully used in practice.
The third ground (5(4)) is intended to apply only to genuine cases in which the boundary between two pieces of land is not fixed under the Land Registration Rules 2003 and the boundary line has been in its present position for at least the last 10 years. The ground will not, therefore, apply where the applicant has moved the boundary deliberately (hoping to acquire more land from a neighbour) because the applicant must show that they “reasonably believed” that the land in question belonged to them.
The overall impression is that, in the majority of cases, the exceptions will prove an insurmountable hurdle to registration discouraging applications of this kind.
An amendment to the 2002 Act?
The Law Commission has repeatedly emphasised that the scheme of adverse possession introduced by the 2002 Act reflects the notion that title to registered land is based on registration and not simply on possession. In its 1998 joint report with the Land Registry, Land Registration for the Twenty-First Century: A Conveyancing Revolution, it stated that “where title is registered, the basis of title is primarily the fact of registration rather than possession”.
If this is correct, then it must be questioned whether the emergence of a dark market in possessory estates is desirable given that such estates may pass through a succession of possessors and endure indefinitely off the register in the absence of any compulsion on the part of the possessor to apply for registration as proprietor in place of the registered proprietor of the land.
If the policy underlying the 2002 Act is to limit dealings with registered land off the register, then this suggests that such possessory estates should not endure forever but be subject to some form of limitation period.
This could be achieved by a relatively simple amendment to the 2002 Act which would require the squatter to bring his application to be registered as proprietor during a stated period following his adverse possession of the land for 10 years or, alternatively, within a limited period of his becoming aware of his rights or following a written notice from the registered proprietor triggering the start of the limitation period for applying to register. A failure to make the application within this extended period (or on receipt of a written notice) would have the effect of automatically extinguishing the squatter’s possessory title in respect of the land so that it would cease to exist for all purposes.
Any attempted alienation of the land would, therefore, no longer have any effect since the squatter would now simply remain in occupation as a bare trespasser entitling the registered proprietor at any time to take proceedings against him to recover possession of the land. In particular, the 10 years of adverse possession would no longer (of itself) afford a defence to the proprietor’s claim, nor would the squatter be entitled to raise any of the three grounds listed in paragraph 5 to Schedule 6.
The overall effect, it is submitted, would be to bring more titles onto the register in line with the underlying rationale of the 2002 Act. At the same time, it would significantly reduce the number of possessory estates existing outside the system and curtail the emergence of a dark side to land registration.
Mark Pawlowski is a barrister and professor of property law at the University of Greenwich and James Brown is a barrister and senior lecturer in law at Aston University
