5.4.5.2. Actual occupation

Registration 561

Personal occupation

Difficulties become more acute where the premises are of a type that is usually occupied by things and not by people. In Kling v. Keston Properties Ltd (1983) 49 P&CR 212, the holder of a right of pre-emption over a garage was held to be in actual occupation of it by parking his car there, and presumably the same would be true of a person who had a property right over, for example, warehouse premises where he stored goods. Taking the matter even further, in Malory Enterprises Ltd v. Cheshire Homes (UK) Ltd [2002] EWCA Civ 151, the Court of Appeal accepted that a property development company was in actual occupation of derelict land when all it did was to maintain a fence to keep out vandals, board up ground floor windows of a derelict building on the land, and occasionally dump rubbish by the fence.

In cases such as these, the courts appear to be equating use with occupation. Do they mean that if you make any physical use of premises you occupy them, even if you use them only for the vestigial purposes permitted by the nature of the premises, as in Malory, and even if one might in other circumstances more accurately describe the premises as ‘unoccupied’ (Malory again)? What if your physical use is shared by others? We know that you can be in occupation of premises even if you share personal occupation with others: is the same true where you are merely one of several people making use of premises by putting goods there?

The questions are difficult to answer because it is not clear why those who are not in personal occupation should have the protection afforded by the overriding interest category, if it is not the reason rightly precluded by Boland. In other words, these cases make sense if one regards actual occupation as a means of alerting potential purchasers to the fact that there may be a prior-interest holder whose interest does not appear on the register. They are more difficult to justify if it is the fact of actual occupation that makes the interest holder deserving of special protection.

Non-residential premises

In the case of non-residential premises, actual occupation in the Boland sense causes no particular difficulty if the interest holder is personally present on the premises and personally carrying on business there on his own behalf. However, ‘constructive’ presence via an employee may be problematic, as may personal presence as an employee: is actual occupation something that one can do on someone else’s behalf? These issues were canvassed, if not conclusively settled, by the courts in Strand Securities Ltd v. Caswell [1965] Ch 958 (where, however, it was not accepted that the interest holder’s step-daughter occupied on her step-father’s behalf) and Abbey National Building Society v. Cann [1991] 1 AC 56, and Stockholm Finance Ltd v. Garden Holdings Inc. [1995] NPC 162 (where there was the added complication that the interest holder was a company). Again, the difficulty with these cases is that the courts are not always clear whether they are looking at occupation as a means of giving notice to potential purchasers, or as a factor justifying the conferment of protection on prior-interest holders.