Agricultural land – Licence – Defendant owner purporting to terminate licence to farm land – Beneficial ownership – Whether claimant owning land by adverse possession – Whether claimant having implied permission to possess land – Claim allowed – Counter-claim dismissed
In 1966, land known as the orange land and other lands was owned by B Ltd. In March 1974, the claimant purchased a neighbouring 31-acre farm that surrounded and abutted the orange land; it also farmed the orange land under a licence agreement, having acknowledged in writing that it was the licensee.
In March 1977, the defendant purchased the orange land, which had the effect of terminating the 1974 licence agreement; however, the claimant continued to farm that land. There was no further communication between the parties until 2007, when the defendant served a notice purporting to terminate the claimant’s licence.
The claimant commenced proceedings claiming to have acquired title to the orange land by adverse possession. It argued that the defendant held the land beneficially on its behalf, pursuant to section 75 of the Land Registration Act 1925 (as reserved by para 18 of Schedule 12 to the Land Registration Act 2002), because the defendant’s title had been extinguished in March 1989, when the claimant achieved 12 years’ adverse possession in accordance with section 15 of the Limitation Act 1980. The defendant counter-claimed, contending that even if the claimant had the necessary intention to possess, its possession was with the implied permission of the defendant.
The court had to determine whether: (i) the claimant had been in factual possession of the orange land for the relevant 12-year period; if so, (ii) it had the necessary intention to possess that was sufficient to render its possession capable of constituting adverse possession; and (iii) its possession was with the defendant’s permission so as to prevent the claimant from being a person in whose favour time could run.
Held: The claim was allowed and the counter-claim was dismissed.
(1) If the law was to attribute possession of land to a party that was unable to establish paper title, that party had to show both factual possession and the requisite intention to possess. In the instant case, it was clear that the claimant had been in factual possession of the orange land for the entirety of the relevant period to the exclusion of the defendant and the rest of the world through its continuous farming activities: Seddon v Smith (1877) 36 LT 168, Powell v McFarlane (1979) 38 P&CR 452 and JA Pye (Oxford) Ltd v Graham [2002] UKHL 30; [2003] 1 AC 419 considered.
(2) Further, the claimant had had the necessary intention to possess in that that simply required possession of the property on one’s own account and in one’s own interests sufficiently, indefinitely and permanently, as to amount to possession in law, and not merely temporary use. So long as the party did so without any permission from the owner, in point of fact or law it would be in adverse possession.
The necessary intention would be negated only if the recognition that a party would leave if the owner required the premises converted the intention to possess into temporary possession only, or not to exercise full control over the land. Where the intention was, as in this case, an intention to possess indefinitely, but coupled with an acceptance that if the paper owner demanded the return of the property it would have to be given up, that intention was sufficient for purposes of adverse possession. Accordingly, once that possession became, in law, possession absent the permission of the paper owner, it was adverse for the purposes of the Limitation Acts: JA Pye applied.
(3) It could not be said that possession had been held by the defendant’s implied licence. To constitute an implied permission, something more than merely letting the previous situation continue was required. Adverse possession occurred even if, apart from concealed fraud, it was unknown to the owner of the land. The fact that the owner might not have appreciated that the permission had terminated by operation of law could, in principle, make no difference. In the instant case, the fact that the claimant continued farming without objection or comment from the defendant was nothing but acquiescence by the defendant. It would be contrary to the established principles of law to find that that gave rise to an implied licence: Bath & North East Somerset District Council v Nicholson [2002] EWHC 674 (Ch); [2002] 10 EG 156 (CS); Batsford Estates (1983) Co Ltd v Taylor [2005] EWCA Civ 489; [2005] 2 EGLR 12; [2005] 33 EG 68; and Colin Dawson Windows Ltd v Howard [2005] EWCA Civ 9; [2005] 2 P&CR 19 considered.
Stephen Jourdan (instructed by Mills & Reeve, of Norwich) appeared for the claimant; John McGhee QC and Timothy Harry (instructed by Birketts LLP, of Ispwich) appeared for the defendant
Eileen O’Grady, barrister
