On 10 December 2012, the Adverse Possession Sub-committee of the Law Reform Commission released a consultation paper at a press conference, making preliminary proposals for the reform of the law on adverse possession.
Deeds registration vs. Title registration
There are two major land registration systems in common law jurisdictions:
- Deeds registration system (which is a register of documents).
- Title registration system (which is a proof of ownership).
The existing system adopted in Hong Kong is the deeds registration system.
The Land Titles Ordinance (Cap 585) was passed by the Legislative Council in 2004. The purpose of this Ordinance is to change the system to title registration. However, for various reasons, this Ordinance is not yet implemented.
Since the existing deeds registration system only registers the documents (i.e., not a person's title), it gives no guarantee of a person's title. Even if a person is registered as the owner of a property, there may still be uncertainties or defects in his title to the property. Hence, title to land is relative and depends ultimately upon possession.
The main provisions on adverse possession can be found in the Limitation Ordinance (Cap 347). Except in the case of Government land for which the limitation period is 60 years, no action to recover landed property is allowed after 12 years from the date upon which the right of action accrued. Time starts to run when the owner has been dispossessed of his land and the adverse possessor has taken possession of the land.
Law Reform Commission's recommendations
The main recommendations in the paper are briefly summarised as follows:
- The existing provisions on adverse possession should be retained since they offer a practical solution to some of the land title problems.
- The law of adverse possession should be recast under the prospective registered land system. Registration should of itself provide a means of protection against adverse possession, though it should not be an absolute protection.
- When a registered title regime (i.e., the system under the Land Title Ordinance) is in place in Hong Kong, adverse possession alone should not extinguish the title to a registered estate. The rights of the registered owner should be protected.
If, for example, the registered proprietor is unable to make the required decisions because of mental disability, or is unable to communicate such decisions because of mental disability or physical impairment, then a squatter's application will not be allowed. However, such protection would not be absolute. Under the proposed scheme:
- The squatter of registered title land will only have a right to apply for registration after 10 years' uninterrupted adverse possession.
- The registered owner will be notified of the squatter's application and will be able to object to the application.
- If the registered owner fails to file an objection within the stipulated time, then the adverse possessor will be registered.
If the registered owner objects, the adverse possessor's application will fail unless he can prove either of the following:
- it would be unconscionable because of an equity by estoppel for the registered owner to seek to dispossess the squatter and the circumstances are such that the squatter ought to be registered as the proprietor; or
- the applicant is for some other reason entitled to be registered as the proprietor of the estate; or
- the squatter has been in adverse possession of land adjacent to their own under the mistaken but reasonable belief that they are the owner of it.
- If the squatter is not evicted and remains in adverse possession for two more years, then the squatter would be entitled to make a second application, and the matter can be referred to the adjudicator for resolution.
The recommendations in the consultation paper are intended to facilitate. The sub-committee said that they welcome views, comments and suggestions on any issues discussed in the consultation paper.
The consultation paper can be accessed on the commission's website at http://www.hkreform.gov.hk/en/publications/adversepossession.htm
All views should be addressed to The Secretary, Adverse Possession Sub-committee, Law Reform Commission by mail (20th Floor, Harcourt House, 39 Gloucester Road, Wanchai), by fax (2865 2902) or by e-mail (firstname.lastname@example.org) on or before 15 March 2013.