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Prudential Assurance Co Ltd v Waterloo Real Estate Inc

Ancient notionally divided wall ceasing to serve as boundary following realignment of street – Ownership of short stretch critical to parties’ respective plans – Whether subsequent acts of apparent owner of wall sufficient to found claim to sole ownership by adverse possession

The defendant (Waterloo) owned a site largely occupied by Normandie Hotel, located on the north side of Raphael Street, which ran westwards from Knightsbridge Green, London SW7. The plaintiff (Prudential) owned the subsoil of Raphael Street and a much larger site extending to the south and west (the Caltex site). The southern boundary of Waterloo’s site was formed by a 30m wall, of which some 7m (the disputed length) had all the appearance of being part of the hotel building. In fact, the entire wall was a much older structure. In 1957 Raphael Street was realigned to the north and effectively shifted to the very foot of the disputed length, which, in consequence, ceased to be regarded as part of the physical boundary between the sites.

In or about 1994 the ownership of the disputed length became a critical issue between the parties. Waterloo’s plan for modernising the Normandie presupposed that it would be able to demolish the disputed length so as to allow vehicle access from Raphael Street. Prudential’s plans for the entire Caltex site depended upon its ability to close Raphael Street altogether. In proceedings commenced by Prudential, the trial judge held that, as a matter of paper title (stemming from a conveyance in 1838), the ownership of the wall was severed, the northern face belonging to Waterloo and the southern to Prudential. Turning to Waterloo’s alternative contention that it had acquired the southern face by adverse possession, the judge found as a fact that, since the 1957 realignment, owners of the Normandie had twice let part of the hotel on terms inclusive of the disputed length, rerendered the wall on two occasions, attended to all maintenance, raised the wall in order to construct a mansard roof with guttering extending over the southern face, attached security devices to the external surface and cut openings through the wall to house a night safe and an overflow pipe. It was further found that those steps had been taken without consulting or receiving comments from the owners of Caltex House. The judge, reasoning primarily from the judgment of Slade J in Powell v McFarlane (1979) 38 P&CR 452, held that Waterloo had obtained good title under the Limitation Act 1980. Prudential accepted the ruling on the paper title, but appealed on the limitation issue, contending that the principles expounded in Powell had been wrongly applied in certain material respects.

Held: The appeal was dismissed.

1. For a claimant to establish the necessary intention by his conduct, that conduct had to be unequivocal in the sense that his intention to possess was made plain to the world. That requirement applied to the conscious and unconscious trespasser (like Waterloo) alike. On a proper reading of the judgment, the judge had not, as argued by Prudential, taken the erroneous view that a less stringent test applied to an unconscious trespasser.

2. There was no requirement that the paper owner and any given member of the world at large had to be aware of the true nature of the rights of the paper owner.

3. It was not disputed that owners of a longitudinally divided wall enjoyed mutual rights of support together with an ancillary right to effect repairs. However, the cleaning work carried out to the side visible from the street, notably the removal of graffiti, was not so referable and accordingly could not be described as equivocal.

4. By extending the mansard roof over the top of the wall and the guttering beyond its southern face, the owners of the Normandie had excluded Prudential from those parts of the wall: cf Stedmanv Smith (1857) 8 E&B 1. Neither those alterations nor the installation of a wall safe and overflow pipe (each cut into the southern half) could be categorised as minor trespasses.

5. The granting of the leases was likewise consistent with overt assertion of ownership of the wall, and could not be equated with the claims made in private conversation that had been considered in Powell (supra)

Timothy Bowles and Robert Clay (instructed by Lovell White Durrant) appeared for the plaintiff; Robin Purchas QC and Guy Newey (instructed by Linklaters & Alliance) appeared for the defendant.

Alan Cooklin, barrister

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