17th June 2016

Hamlins’ Property Litigation partner Kate Andrews explains squatters’ rights in PrimeResi

By Kate Andrews

A recent case involving squatters’ rights has cut right to the heart of the historic basis of land ownership, exposing the lack of clarity around this area of law. Kate Andrews runs us through the background, implications and important questions raised…

The Court of Appeal’s decision in Best v Chief Land Registrar means that pensioner Colin Curtis has lost his property to builder Keith Best who had been squatting in it for several years. The property is reported to be worth £400,000 and previously belonged to the mother of Mr Curtis.

Mr. Best started renovation works on the three bedroom semi-detached house in 1997, about a year after Mr. Curtis moved out. Mr. Best eventually moved in during 2012 and made an application to the Land Registry to be registered as proprietor. The application was not immediately granted and led to the legal wrangle which reached the Court of Appeal. It is reported that Mr. Curtis now lives in sheltered accommodation which he may be forced to sell to pay Mr. Best’s legal costs.

The outcome is intuitively wrong. Squatting is trespass. Logically, the wrongdoer ought not to be rewarded for his wrongdoing. So, how is such a situation possible?

Historic Basis of Land Ownership

Mr. Curtis’ plight and Mr. Best’s victory go to the heart of the historic basis of land ownership.

Before the introduction of a system of land registration, title to land has been based on possession. Very simply, the person who has possessed the land for the longest period of time has best title to it and so can exclude all others having a lesser title from using or enjoying that land, including bringing a claim for possession.

Such an open-ended system of land ownership is impractical for many reasons. The most significant is that purchasers of land need some form of guarantee that the vendor’s title cannot be defeated by someone with better title. To overcome this issue, there has, over the years been a number of statutes limiting the amount of time a land owner can bring a claim for possession of land against others with a lesser title. The most recent (and current) incarnation of this is Section 15 of the Limitation Act 1980 which provides a land owner cannot bring a claim for possession of unregistered land 12 years after the right to do so first arises. Section 17 of that Act also provides that an owner’s title to unregistered land is extinguished after the period for bringing a claim has expired.

In other words, for unregistered land, if someone takes possession of another’s land and no claim is brought for possession within 12 years, the person in possession can become the legal owner with good and marketable title. This process is known as adverse possession and is the way a squatter can become the owner of another’s land.

The Modern Basis of Land Ownership

The introduction of land registration has changed the basis of land ownership. Ownership of registered land is not based on possession, instead the person who is registered as proprietor of the land has (notionally) absolute and indefeasible title to it.

The registration of land is still not complete in England and Wales and so the two inconsistent systems of relative and absolute title live side by side. It is not, therefore, yet possible to ‘do away’ with adverse possession entirely.

However, the rules relating to adverse possession in registered land differ to those for unregistered land. Section 96 of the Land Registration Act 2002 removes the time limit for bringing a claim for possession of registered land and provides that registered title to land will not be extinguished on the expiry of the time limit for bringing a claim. At the same time, Schedule 6 of the Land Registration Act 2002 introduces a new system for adverse possession which makes it harder to achieve: a squatter can apply for adverse possession after 10 years, but the registered proprietor must be notified and has an opportunity to respond and require that the application be dealt with in accordance with provisions laid out in the 2002 Act, and the additional criteria set out therein.

Criminalisation of Trespass in Residential Properties

In a system of registered (and absolute) ownership, squatting and adverse possession seems outmoded. Squatting generally is a problem and causes expense and inconvenience to many landowners. Until recently, squatting was generally a civil matter (entitling a land-owner to bring a claim for possession and/or damages and to apply for an injunction). That has recently changed.

Under Section 144 of the Legal Aid Sentencing and Punishment of Offenders Act 2012, a trespasser commits a criminal offence if he/she enters a residential building as a trespasser and he/she ought to have known he or she is a trespasser and is living in the building or intends to live there for any period. The sanctions are imprisonment or a fine.

The criminalisation of squatting in residential properties may be more in line with the popular sense of right and wrong, but does it fit with the historic foundation of land ownership (which, in the case of unregistered land, still operates)?

In Best v Chief Land Registrar, Mr. Best’s application to become registered proprietor had not been granted by the Chief Land Registrar on the basis that he could not rely on an act which was a criminal offence (that is, because of S. 144 of the 2012 Act) as evidence of adverse possession. Mr. Best challenged this. The matter worked its way through the High Court to the Court of Appeal and the conclusion is that adverse possession based on criminal trespass does not prevent an application for registration under the Land Registration Act 2002. Whatever one’s position on the rights and wrongs of squatting, it is an important judgment. Conceivably a different finding would have wiped out many, if not most, adverse possession claims.

Should Adverse Possession still exist in Registered Land

Squatting is central to a possession based system of land-ownership. But should it have a place in a registration based system of land ownership?

The Law Commission’s paper “Land Registration for the Twenty-First Century” which led to the Land Registration Act 2002 refers to grounds for the doctrine of adverse possession [para 2.72]. In particular, it says ‘Land is a precious resource and should be kept in use and in commerce’. Even in registered land, true owners can disappear or the register might not reflect the practical reality of a situation.

Adverse possession is recognised as still having a value, even in a system of registration. A truly absolute system of land ownership may not be desirable. When registration of all land in England and Wales is complete, however, maybe the possession based approach to dealing with glitches and wrinkles in the system will be revisited and a new approach introduced. Time will tell.

For further information, please contact Kate Andrews.

The article was first published in Prime Resi in June 2016.

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