Builder Keith Best has won a Court of Appeal case allowing his ownership of a £400,000 house after he refurbished it and started squatting it in 2001 – even though he was squatting illegally after 2012.
Best had noticed the empty house in Church Road, Newbury Park, Ilford, in 1997 and decided to make it habitable, moving in in 2001. Around 2013 he applied to the Land Registry to have it registered in his name. The law says an occupier “in adverse possession” (ie squatting without permission of the owner or having established possession by other means, such as putting a fence around the property) can apply to the land registrar to place it in his name after 10 years.
But Best staked his claim after the criminalisation of residential squatting in 2012. The registrar argued that since Best was in illegal occupation after that time, his claim could not be registered. Ownership would not be transferred to him.
The Court of Appeal has now said the registrar was wrong. The criminalisation of squatting in Section 144 of the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO S.144) did not prevent a perfectly legal claim to a property under the 2002 Land Registration Act. Lord Justice Sales said:
“I consider that the true inference is that in enacting section 144 Parliament did not intend to produce any collateral effect upon the settled law of adverse possession in respect of either registered or unregistered land.” (Para 75)
Adverse possession is covered by Schedule 6 to the Land Registration Act 2002 which says: “A person may apply to the registrar to be registered as the proprietor of a registered estate in land if he has been in adverse possession of the estate for the period of ten years ending on the date of the application.”
A further two years is allowed while the registrar contacts the previously registered owner (“the proprietor of the estate to which the application relates,“) plus others with a potential interest to see if they object to the transfer to a new owner. “Possession” need not be by squatting but by an action that counts as possession. Best did a lot of work on the house over the years but was not always actually living there during his 10 years of adverse possession. Nevertheless he accrued the Schedule 6 right to make his application. The new ruling from the Court of Appeal confirms that the “adverse possession” (without permission but without objection or resistance by the owner) may include a period of time when occupation is unlawful under LASPO S.144.
The legal issues
The court considered whether or not to apply the venerable legal doctrine of ex turpi causa non oritur actio (a claim cannot be founded on a wrong committed by the claimant). Could Best make an honest claim under the Land Registration Act on the basis of a wrongful act under LASPO? Sales LJ said:
“Adverse possession is, of course, founded on the tort of trespass to land. The public interest in having land put to good use and in having clear rules to govern acquisition of title to land which has been abandoned has been taken to override the general concern that a person should not benefit from their unlawful actions.”
So an adverse possession claim is already founded on a “wrong” – the act of trespassing on land, but public policy allows it on the basis of the wider public interest of putting land to good use. While Parliament had expressed public concern about squatting by passing Section 144, it had not taken any action regarding the adverse possession regime of the Land Registration Act. The application of the ex turpi rule was a matter of assessing public policy, and in this case Sales LJ concluded:
“I do not consider that the enactment of section 144 and the commission of an offence under it has any material effect on the operation of the law of adverse possession.” (Para 50)
To accept the ex turpi rule against Best in this case would damage in particular the legal certainty regarding property law that the LRA 2002 intended to ensure. Furthermore, on reading government background material on Section 144 it was clear: “The mischief which section 144 was intended to address and the objective it was intended to achieve had nothing to do with the operation of the law of adverse possession.” (Para 70) In consultation on the LASPO Bill, the Land Registry had even raised the issue of how Section 144 would affect adverse possession, but the Government in proposing the legislation had made no comment on that issue. Sales LJ said:
“It is not plausible to suppose that Parliament would have been silent about the impact of a provision like section 144 on the delicate and comprehensive balance of interests set out in the Limitation Act 1980 and in Schedule 6 to the LRA, had it truly intended that section 144 should have any impact at all on those regimes.” (Para 73)
Lady Justice Arden agreed with Sales LJ and added on the social benefit of adverse possession: “[T]he adverse possession provisions of the LRA serve valuable social and economic purposes, including that of ensuring that land is kept marketable and is not ‘sterilised’ by the inaction of the true owner. Land is a valuable commodity. It provides space for homes, offices and agriculture. But, in addition to that, land can be used to raise money to create new businesses and help the economy.”
Note: A full background and comment on Best’s case based on the original High Court hearing before Mr Justice Ouseley can be found here: The LASPO s.144 debacle