
Экзамен зачет учебный год 2023 / Dixon, Modern Land Law
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Modern Land Law
11.2.3The effect of a successful claim of adverse possession in unregistered land
This section deals with the effects of a successful claim of adverse possession on land of unregistered title; that is, when the evidential base has been proved and the limitation period has expire. In these cases, it should come as no surprise to learn that the effects of a successful claim of adverse possession vary according to the perspectives of the parties. In particular, the effect on tenants has attracted much interest in recent years.
11.2.3.1 Effect on the paper owner
It is settled law that once the limitation period has run its course in respect of unregistered land, both the paper owner’s right to sue and their title are extinguished by operation of statute(section 17 of the Limitation Act 1980). After this date, the conventional wisdom is that no acknowledgment of the paper owner’s title, written or otherwise, and no payment, rent or other sum can revive the title.40 This should be uncontroversial, as it is simply the consequence of the application of the Limitation Act 1980 and an expression of its underlying policy. However, the Court of Appeal has held, in Colchester BC v. Smith (1992) that in some circumstances, a written acknowledgment of the paper owner’s title by the adverse possessor, given after the period of limitation has ended, can be enough to prevent the adverse possessor relying on adverse possession in the face of an action for possession by the owner. This interesting decision appears to be based on an application of the estoppel doctrine, in that the adverse possessor is estopped from denying the paper owner’s title by the written acknowledgment, freely given. Surprisingly, the court offers no convincing reason why the Limitation Act 1980 should be ignored in this fashion, or even why the paper owner deserves to benefit from an estoppel; after all, the paper owner has slept on his rights, and why should a court of equity now come running to his aid? Neither does the court consider Nicholson v. England (1962) and, in this sense, the decision in Smith might be regarded as per incuriam. However, at present, the Colchester decision appears to be authority for the proposition that a bona fide compromise of a dispute between two persons (i.e. paper owner and adverse possessor), both of whom had legal advice, should be upheld on public policy grounds, even if the 12-year period of limitation has run. This is supported by the decision in the Trustees in the Charity of Sir John Morden v. Mayrick (2007), where the claimant was not permitted to disavow a compromise agreement relating to ownership of land (on the ground that he had in fact completed adverse possession prior to conclusion of the agreement), because he had entered into
40 Nicholson v. England (1962).
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the agreement freely and had raised no argument based on adverse possession at the time. In other words, a man will be bound by his contract.41
11.2.3.2 Effect on the adverse possessor – freeholds
The traditional doctrinal position is that a successful plea of adverse possession against unregistered land does not transfer the paper owner’s title to the adverse possessor. It operates negatively to prevent the paper owner suing the adverse possessor (or person now in possession; for example, a purchaser from the adverse possessor) and extinguishes the former title (section 17 of the Limitation Act 1980). There is no conveyance of the land from paper owner to adverse possessor. Moreover, because the adverse possessor is not a purchaser from (or even transferee from) the paper owner, the adverse possessor takes the land subject to all pre-existing proprietary obligations, whether these are registered as land charges or not. So, for example, an adverse possessor will be bound by the burden of unprotected equitable easements and unprotected restrictive covenants (as well as those protected as land charges) because the adverse possessor can never be ‘equity’s darling’. Yet, it is also true that an adverse possessor does acquire something as a result of a successful adverse possession because the adverse possessor may go on to deal with the land as if it were his own. He may sell it, lease it, devise it (i.e. by will), give it away, grant easements over it and generally do those things that an estate owner might do. In other words, a successful adverse possessor does acquire a valuable asset. How, in practice, does this work?
As noted above, in unregistered land the adverse possessor does not take, and is not treated as taking, a conveyance from the paper owner. Consequently, the paper owner has a bundle of worthless title documents and the adverse possessor has no proof of title at all. Yet, in practice, an adverse possessor with proof of established adverse possession usually can find a willing purchaser and will convey the land by deed to that purchaser. This new deed will be the first evidence of the adverse possessor’s title and first evidence of that of the new purchaser.42 Necessarily, of course, the
41This seemingly unobjectionable principle does not, in the context of adverse possession, recognise that there is also a policy consideration – recognised and effected by Act of Parliament no less – to the effect that sleeping on one’s rights deprives a person of those rights. The judgment in Smith fails to explain why a contract between the parties can override the express provisions of an Act of Parliament. Although some commentators accept that, in principle, contracting out of the Limitation Act 1980 should be possible, it is submitted that this should not be permitted, save in the most exceptional circumstances. The policy argument is more justifiable in the Mayrick case because, prior to the compromise agreement, adverse possession had not been an issue between the parties.
42The purchaser will then use this deed and the pre-existing claim of adverse possession to apply for first registration of title under the LRA 2002.
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adverse possessor will not be able to make out a good ‘root of title’,43 but the purchaser may be happy with a statutory declaration of good title, supported perhaps by ‘title insurance’.44 In effect then, a ‘new’ title is generated by the conveyancing process.
11.2.3.3 Effect on the adverse possessor – leaseholds
The traditional doctrine that there is no conveyance of the paper owner’s unregistered estate to the adverse possessor has some unusual consequences in the context of leaseholds. It will be remembered that a successful 12 years’ adverse possession against a tenant extinguishes only the tenant’s estate, and that the landlord has a further period of 12 years after the end of the original period of the lease in which to eject the adverse possessor before he also finds his title extinguished. This is all well and good because, as noted above, time can only run against a person when he has a right to recover land, and a landlord only has such a right when the lease expires. However, while it is true that the tenant has lost his estate by adverse possession vis-à-vis the adverse possessor, it is also true that the tenant remains as tenant vis-à-vis the landlord for the entire duration of the original lease.45 Title is relative. So, during the currency of the lease, the landlord can bring forfeiture proceedings against the tenant (for, say, non-payment of rent), even though the adverse possessor is in possession of the land under a successful (i.e. time barred) adverse possession. The effect of such forfeiture46 is to terminate the lease and bring forward the landlord’s right to eject the adverse possessor! Note, however, that the converse of the rule – that the ejected tenant remains ‘tenant’ the landlord – is that the adverse possessor is not to be regarded as the tenant, nor an assignee of the tenant, so cannot be liable on any leasehold covenants save those enforceable as restrictive covenants under the rule in Tulk v. Moxhay (1848).47
Although apparently complicated, the picture painted above is quite simple; the adverse possessor has extinguished the tenant’s title as far as he is concerned, but the tenant remains the tenant of the landlord. The difficulties arise when the ejected tenant seeks to manipulate his continuing relationship with the landlord to defeat the adverse possessor. For example, we have just noted that the landlord may forfeit the lease in an action against the ejected
43See Chapter 3.
44This is an insurance policy, paid for by the adverse possessor and purchased from a specialist company, guaranteeing compensation if the adverse possessor’s title should prove to be defective. It is very common in legal systems that do not have a state backed guarantee of title.
45See also Chan Suk Yin v. Harvest Good Development Ltd (2005), per Lord Hoffmann, giving judgment in the Hong Kong Court of Final Appeal.
46In which proceedings the adverse possessor has no right to apply for relief (Tickner v.
Buzzacott (1965)).
47See Chapter 8.
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tenant, thereby bringing forward the landlord’s right of action against the adverse possessor: the landlord does not have to wait until the lease term has expired. What, however, if the tenant surrenders his lease to the landlord, despite having ‘lost’ title vis-à-vis the adverse possessor? Does this also terminate the lease and bring forward the landlord’s right of action? In unregistered land, the case of Fairweather v. St Marylebone Property Co Ltd (1963) appears to provide a clear answer. In that case, a tenant against whom adverse possession had been completed successfully, surrendered the lease to the landlord, and the House of Lords held that this was effective to terminate the lease. In other words, the lease was brought to an end by a person (the ejected tenant) who still had an estate vis-à-vis the landlord. The adverse possessor then had no relief against the subsequent early termination of the lease because the adverse possessor does not occupy the land under the original lease, and is not entitled to remain for its full period if that lease is lawfully terminated. As a matter of strict logic and theory, this is difficult to fault. However, on a common sense view, it is difficult to see why the ejected tenant should have the power to surrender a lease that, to all intents and purposes, is an empty shell. The inequity to the adverse possessor is even more apparent if the landlord, having then evicted the adverse possessor, regrants a new lease to the ejected tenant!48 Despite powerful criticisms of this rule judicially and academically, it now seems likely that it will not be overruled: it applies only in the context of unregistered title and unregistered title is rapidly decreasing in significance.
11.2.4The substantive nature of the adverse possessor’s rights prior to completing the period of limitation in unregistered land
Pending completion of the period of limitation in respect of unregistered land, the adverse possessor is taken to have certain rights in the land, even though these can be completely defeated by the paper owner recovering possession within the limitation period. Thus, an adverse possessor awaiting completion
48Before the LRA 2002 made comparisons between registered and unregistered land pointless, the position in registered land under the LRA 1925 was different from that pertaining in unregistered land. In Central London Commercial Estates Ltd v. Kato Kagaku Ltd, the ejected tenant surrendered its lease to the freeholder, and the registered title to that lease was closed. The freeholder sought to evict the adverse possessor before the lease had expired. However, the court held that the effect of section 75 of the LRA 1925 (which was then operative) was to ensure that the tenant’s interest was held on trust for the adverse possessor, and that the tenant could not surrender after the period of limitation had run. In effect, the court held that the tenant’s interest in the lease did pass to the adverse possessor, and the adverse possessor could remain on the land for the remainder of the term. Sedley J goes so far as to say that there was, in reality, a statutory conveyance of the original lease with benefits and burdens intact.
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