Squatters’ rights….and the Land Registration Act 2002…….is your land safe?
A person who occupies land belonging to someone else without permission is a trespasser. However, a trespasser can become the lawful owner of land - he is often said to have acquired ‘squatter’s rights’.
If a trespasser has ‘physical possession’ of land and, at the same time, demonstrates that he ‘intends to possess’ the land to the exclusion of everyone else, even the true owner, he will be in ‘adverse possession’.
If a trespasser has adverse possession of unregistered land and the owner fails to take eviction proceedings before the end of, normally, 12 years (there are exceptions) from the time when the trespasser first occupied it, the true owner will lose his land and the trespasser could apply for registration of it.
A trespasser who can show a period of 12 years’ adverse possession of registered land which ended before 13th October 2003 but after the land was registered is entitled to be substituted for the registered owner. It doesn’t matter that the land has not been registered land for the whole 12 year period. So, if for example, a trespasser occupied unregistered land on the 8th January 1990, which the owner registered on 10th October 2001, the trespasser may claim entitlement to the registered land on 8th January 2002. However, the Land Registration Act 2002 made significant changes to adverse possession of registered land. Unless a squatter’s rights over registered land have fully accrued before 13th October 2003, they do not continue to accrue, and the trespasser must look to the Act for help.
Under the Act, what amounts to ‘adverse possession’ still applies; one still has to show ‘factual possession’ and an ‘intention to possess’ the land. But it is only a successful application under the Act which gives title to registered land. An application can be made where a person in adverse possession relies on 10 years’ adverse possession ending on or after 13th October 2003. So, if a person started occupying registered land, say, on 20 January 1999, he could today only make an application under the Act.
Upon receipt of an application under the Act, Land Registry sends a notice to the existing registered owner and any mortgage lender, if there is one. If no counter-notice is sent by the owner or lender, the applicant will become the registered owner, free of any existing mortgage.
A counter-notice, however, can require the applicant to satisfy any one of three conditions before he is entitled to become the new owner. He can succeed if he can demonstrate that the owner of the land, in some way, allowed him to believe mistakenly the land was his, and as a consequence of that belief, he spent money building on it, or altering it in some way. If it is not too unjust to the owner, the applicant will be registered; otherwise, an alternative remedy would have to be given.
Secondly, an applicant can succeed if he can show ‘some other reason why he should be registered as owner’. For example, the applicant may have purchased the land from his neighbour without completing the legal documents, which only comes to light several years later.
Finally, if an applicant can show that there has been a ‘reasonable mistake as to the boundary’, he can succeed on this ground. The applicant has to show that the land he is claiming is adjacent to land he already owns and which for the last 10 years he (or any predecessors to him) reasonably believed belonged to him. The land being claimed must also have been registered for more than one year before the application.
The owner may simply object to the application, without requiring the applicant to satisfy one of the conditions. It might be disputed, for example, that the trespasser has been in adverse possession. If an objection is received, the objection will have to be disposed of if it is not groundless by agreement between the parties, or the adjudicator to HM Land Registry.
If an application is rejected by Land Registry because, for instance, the applicant does not satisfy one of the conditions, the applicant has a right to make another application after two years if he has not been evicted and he is still occupying the land, subject to some exceptions. Upon a new application, he will be registered as the new owner.
If an applicant is successful under the Act, he takes the land free of any mortgage affecting the land unless the application succeeded as a result of satisfying one of the three conditions. In these circumstances, the applicant is subject to any mortgage affecting the land, but he now has the right to have the mortgage apportioned between the land he has acquired and the remainder, if there is any, based on their respective values.
What about a purchaser? Is a purchaser affected by a squatter’s rights…?
A person buying unregistered land should check it for any obvious signs of a squatter. From 13 October 2006, a purchaser will only take the land subject to a squatter’s rights if the squatter is in actual occupation of the land or, if the squatter is not in occupation, the purchaser knows about the squatter, i.e., he has been told about the squatter, or would have known about the squatter if appropriate enquiries had been made or an inspection of the land conducted.
A trespasser entitled to registered land, say, since 10 December 1999, could apply to Land Registry for it to be registered in his name. If he has not done this, a purchaser acquiring the land before 13 October 2006 will take it subject to the squatter’s rights. However, a purchaser acquiring the land after 12 October 2006 will take the land subject to the squatter’s rights only if the trespasser is in actual occupation of the land except where the purchaser does not actually know about the trespasser’s rights and occupation of the land by the trespasser would not have been obvious on a reasonably careful inspection of the land at the time of the purchase. Furthermore, a purchaser will not be bound by the rights of a squatter if, upon enquiry, the squatter failed to reveal them to the purchaser.
Under the Act a trespasser (not being a trespasser with already accrued rights before 13 October 2003) does not acquire an entitlement to be registered as the new owner. A trespasser can only be registered as the owner because either no objection has been lodged or an objection has been disposed of in the applicant’s favour; or one (or more) of the three conditions has been satisfied.
It is now more difficult to become the owner of registered land by adverse possession after 2003. For this reason, anyone owning unregistered land should voluntarily register it now, to stop a trespasser from continuing to accrue rights. For instance, if a trespasser has occupied unregistered land, say, for 5 years before it is first registered on 2nd February 2011, he will need to bring himself within the provisions of the Act if he is going to succeed in becoming the registered owner.
It is also crucial that the address for the registered owner on the register is kept up to date, so that if a notice of an application by a trespasser is sent by Land Registry, it will reach the owner. If an owner does not object to an application or serve a counter-notice within 65 business days, the trespasser will be registered as the new owner.
Written by: Francis Whitehead, B.A. (Hons), Dip. LRQ, Solicitor, Consultant
Hopley Pierce & Bird Solicitors
5 King Street
Wrexham
LL11 1HF
Copyright. All rights reserved. No responsibility for any loss brought about by reason of a person acting or not acting on the material in this article is accepted by the writer. Any views or opinions are not expressed to be the views or opinions of Land Registry or Hopley Pierce & Bird and it is the writer’s own interpretation of the law.