Do the Paperwork or Risk the Consequences

'Adverse possession' is the legal name for what are commonly known as 'squatters' rights' - the law by which a person can acquire legal title to land they occupy if they intend to occupy it on their own behalf, to the exclusion of others, and do so throughout a specified, uninterrupted period and follow a set notice procedure, which depends on whether the land is registered or unregistered land.

A recent case (which has gone to appeal to be heard in the summer) illustrates how contentious the interpretation of the law can be. It involved an area of farmland, which had been informally occupied by a farmer and used by him for farming. He ceased to have any formal right to occupy the land in 1977, when the company that owned it passed the title to a new company. The new company did not renew the licence under which the farmer had previously occupied the land.

In 1994, gravel was extracted from the land and the real owner kept the proceeds and reinstated the farmland. In 2007, the farmer sought a declaration that the land belonged to him and to have it registered in his name.

Before the court were the following questions:

Had he intended to occupy the land on his own behalf?
The court agreed he had, in spite of the fact that he had known nothing of the legal aspects of his occupation and did not know whether he was occupying with permission or not. In the view of the court, the intention to continue to occupy the land for as long as possible is sufficient.

Was the land occupied to the exclusion of others for twelve years?
With the benefit of unassailable evidence that the land was farmed throughout the period (except during the period in 1994 when gravel was extracted), the court concluded it was, notwithstanding the owners having accessed the land occasionally. Had the farmer occupied the property under an implied licence?
The owner's claim was based mainly on the conduct of the farmer regarding the extraction of gravel. However, the lack of any written or other evidence that a licence existed was regarded as indicative that the landowner had continued to acquiesce in the farmer's occupation of the land.

This case is listed for appeal, but it illustrates the danger of allowing others to make use of your land without formalising the arrangement, even if a peppercorn rent would be the outcome.

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