Question

My wife and I purchased a property in December 2003 (“no 1”), which was built in 1989 along with its neighbouring property (“no 3”). No 1 included a garden which the owners of no 1 had arranged and laid out in the summer of 1991. This garden included a triangle of no 3’s land (the “triangle”). The original owners of no 3 did not raise any objection in 1991 about the inclusion of the triangle in no 1’s garden. No 3 was subsequently sold in 2007. In 2018, title was transferred to the current owners. When we purchased no 1, we carried on using the triangle as if it were our own. This continued without objection from the then neighbouring owners. The new owners of no 3 are now claiming that we have stolen the triangle and are alleging that this occurred fairly recently. Can we be registered as proprietors of the triangle based on adverse possession?

Answer

Yes, if you are able to prove that the triangle has been treated as a part of your garden for a 12-year period before 13 October 2003, and that you and the previous owners of no 1 have been in possession of it without the consent of your neighbouring owners, then you are entitled to be registered as proprietors.

Explanation

The current legislation on adverse possession, the Land Registration Act 2002, was not enacted until 13 October 2003, so the dates in the question mean the answer lies partly in the previous law.

The previous law starts with the Limitation Act 1980, which still applies to unregistered land, and resulted in an extinguishment of the paper owner’s title after 12 years of adverse possession. But if the land was registered, the Land Registration Act 1925 (repealed) provided that the registered proprietor would hold the land on trust for the squatter. Once the 2002 Act was enacted, the transitional provisions in paragraph 18 of Schedule 12, entitle the beneficiary under a trust created before 13 October 2003 to be registered as proprietor.

To be in adverse possession, the squatter must establish that: (1) they are in possession of the land in issue – this must be single and exclusive physical custody of the land; and (2) they had an intention to exercise such custody and control on their own behalf or for their own benefit (JA Pye (Oxford) Ltd and another v Graham and another [2002] UKHL 30; [2002] PLSCS 163).

What acts constitute a sufficient degree of exclusive physical control depends on the circumstances, the nature of the land and themanner in which land of that kind is commonly used. But it is not necessary to show there was a deliberate intention to exclude theowner or to be the registered proprietor: “The only intention which has to be demonstrated is an intention to occupy and use the landas one’s own” and to “exclude the world at large”.

If the triangle was incorporated into the garden of no 1 to form a distinct boundary with no 3, this is a clear indicium of ownership. Other factors, such as maintenance of shrubs in the triangle, are also indicative but may not be sufficient alone.

Another issue is whether the previous owners of no 3 provided consent. If they had, there could be no adverse possession (Healey vFraine [2023] EWCA Civ 529; [2023] PLSCS 87), as possession would simply not be adverse. But the First-tier Tribunal recently held in Waters v Stott (2023) REF/2021/0470 that if the previous owners knew how the triangle was being used and made no objection, this would not constitute consent.

Possessory title can be passed to another squatter without the need for a formal transfer of their possessory estate. On the facts, it seems the previous owners of no 1 adversely possessed the triangle, and this continued after your purchase. The triangle was seemingly adversely possessed by the summer of 1991, establishing the 12-year period by the summer of 2003. In accordance with section 75 of the 1925 Act, after the 12 years had been established, the triangle would have been held on trust for the person in adverse possession without the need for a formal transfer. This was shortly before the repeal of the 1925 Act on 13 October 2003, and just in time to engage the transitional provisions in the 2003 Act.

Waters recently confirmed what happens where, immediately before 13 October 2003, a registered estate was held on trust for a person under section 75 of the 1925 Act: paragraph 18 to Schedule 12 did not continue the deemed trust; instead, it provided that the person was entitled to be registered as the proprietor.

When a person has the right to be registered under paragraph 18 and transfers the land to someone else, the transferee will take subject to the paragraph 18 right, provided that the person with that right was in actual occupation of the land on the date of the transfer. The exception is if the transferor was asked whether they have a right and failed to disclose it, or their occupation was not obvious on a reasonably careful inspection of the land and the transferee did not have actual knowledge of the interest at the time (paragraph 2(c) of Schedule 3 to the 2002 Act).

Unless that exception applied, no 1 was in actual occupation of the triangle when no 3 changed ownership, so the new owners took subject to no 1’s paragraph 18 right.

This article was originally posted to Estates Gazette on 14 November 2023.