General Principles
Overview
A person may acquire ownership of property by remaining in possession of it for the period prescribed by law, for the owner to take legal action to recover possession. This is sometimes referred to as squatting or adverse possession. The possession is adverse in the sense that it is in defiance of the title of the owner.
The Statute of Limitations places time limits on the periods during which the various types of legal claims may be initiated. The legislation applies to all claims and provides differing time limits, for different types of claim. Most claims for the recovery of land and buildings provide a twelve-year time limit. See generally the separate section on the statute of limitations in the context of other claims.
The Statute of Limitations requires that legal action for the recovery of possession of land must be commenced within 12 years. The period runs from the time when the claimant is first entitled to take legal action. Therefore, if a person is in possession of property without consent in defiance of the owner’s rights, the owner must commence a legal action within 12 years or lose that right, by failure to do so. Where the “true owner” (or “legal owner”) has lost his right to take legal action, the person in possession obtains an effective title, in the sense that true owner can no longer take action to dispossess him.
It is a fundamental principle of property law that a person in possession of the property is entitled to maintain and defend his right to possession, against all persons, except the “true” owner, with a legal title based on deeds or land registration. A person in possession can enforce his right by taking legal action for trespass or nuisance. A third party cannot set up the right of the true owner, against the person in possession. Only the true owner may assert this right. When the true owner’s right is barred, the possessor obtains his possessory title.
Acquisition of title by adverse possession often happens when a person remains on the property after the death of a family member, without obtaining a grant of probate or letters of administration or any formal vesting of title. This commonly occurs with property which is passed from one generation to the next, such as a farm.
Adverse Possession
“Adverse possession” requires that the squatter be physically in possession of the property. The degree of possession must be such that the “true” owner is entitled to take legal action to recover possession. Possession does not necessarily mean continuous physical possession. There must be an intention to possess coupled with acts and conduct giving effect to that intention.
What constitutes adverse possession will depend on the nature of the property and how it is used. There must be a sufficient degree of exclusive physical control or occupation. The legal owner must not himself be in possession. The claimant’s possession must be inconsistent with the legal owner’s possession. In the context of leased land, possession of the rent is equivalent to possession. A person may acquire title by collecting the rents as if he was the true owner for over the relevant period generally 12 years.
Acting as if one is owner, would be good evidence of possession. For example, building on land, fencing it, and doing things that are normally done by the owner, tends to show possession. Some apparently significant acts may not necessarily indicate exclusive possession. Temporary grazing or temporary storage of material on land may not constitute exclusive possession. Each case is however different, and each may raise matters of interpretation.
The claimant must intend to possess and have control of the property without the consent of the true owner. A person in possession with the consent of the true owner is not in adverse possession. A person in occupation as a tenant or otherwise with the owner’s consent is not in adverse possession. The possession is not adverse to that of the true owner but is consistent with it. It derives from the true owner’s specific consent.
The degree to which possession must be inconsistent with that of the true owner in order to be adverse has been a question on which the courts have disagreed over the years. In some cases, the courts have held that there could be no adverse or inconsistent possession if the true owner had no present use, but had some future intended use for the land. However, the most recent UK Supreme Court cases have laid less emphasis on this principle. They have instead, pointed to the primacy of actual possession on the part of the claimant, as the key factor and have given less weight to the true owner’s intention.
Title by Possession
A person in possession may transfer his so-called “possessory” title to another. That owner or successor takes the benefit of the period of the possession of the predecessor. In this way, a person in possession may give a possessory title, even though the title vulnerable to a claim by the true owner/legal owner, until the relevant period has elapsed.
The successor may take his predecessor’s period of possession. The clock does not have to restart, provided he takes immediate possession. In contrast, if the person in possession abandons that possession and he or another re-enters possession, he does not acquire take the benefit of the predecessor’s period of possession. The legal owner will have a fresh right to recover possession.
The period in which a legal owner may recover possession is generally 12 years. In some cases, this period is extended and is some cases it is shorter. Legal action must actually be instituted by the issue of court proceedings for possession within this period. Once issued the proceedings must be served within a certain period or they will lapse.
The State and some State Authorities have longer periods in which to recover possession. This longer period is usually s 30 years. A 60 year period applies to possession of the foreshore i.e. between high and low tide.
Postponement of the Standard Period
The standard (usually 12 years) time limit may be postponed by reason of certain circumstances (which are not necessarily readily apparent). The general rule is that the time runs from when the squatter enters possession, adverse to the title of the true owner. This period may commence, or indeed run in its entirety, without the true legal owner ever being aware and he may lose the title by adverse possession of another, without his knowledge.
Where the legal owner has been defrauded, the time period does not commence, until the person discovers the fraud or could with reasonable diligence have discovered it. In this context, fraud requires a deliberate, deceitful and fraudulent conduct. There may, for example, the fraudulent concealment of the true possession. The possession by a squatter is not if itself fraudulent. The fact that the possession happens unknown to the true owner, does not make it fraudulent.
There is a limited basis upon which the period may be extended due to mistake. A mistake about the extent of property or a boundary would not be sufficient. Indeed, many boundaries prescribed by deed are rectified by the Statute of Limitations, so that the title is corrected over time, so it accords with actual possession.
The exception for mistake will only be available in narrow exceptional circumstances. The fact that the true owner is mistaken as to his rights is not sufficient. A mistake, in this context, would include, for example, a mistake in a deed by which it did not reflect the agreed transaction.
Where the legal owner does not have the legal capacity to take action, the period for taking action is postponed. This would occur if the legal owner is under 18 years or is of unsound mind. In this case, legal action may be taken within six years from the date the person ceases to under the disability or dies, whichever is earlier.
In the case of actions to recover land or money charged on land, the maximum period is 30 years.
The period in which the true owner must take action will recommence afresh if the person in a possession acknowledges his title in writing signed by him or on his behalf. This might occur where the squatter offers to buy the title of the owner or take a lease. If the legal owner retakes possession during the limitation period, and the squatter or another takes possession again, the time limit will start again.
Certain estates (rights) to land may not take effect until a future date. A person may own land for life, while another’s ownership (the reversion/future interest) may commence on the former’s death. In such cases, the holder of the future rights has six years from the date his rights to possession kicks in, in which to take action or the original standard period whichever is longer.
A similar principle applies to leases. The landlord has 12 years from the termination of a lease in which to take action against persons who squatted against the tenant. This principle applies to short-term leases and also to long leases at nominal ground rent. The legal owner may, for example, hold under a 99-year lease. The person in possession may bar the rights of the 99-year lessee to take legal action after 12 years. However, he remains vulnerable at the end of the 99th year period to the claim of the leaser under the long lease
This above position reflects the general principle that the person in possession bars the rights of the person entitled to immediate possession. If that person has short right or interest, he is vulnerable to later enforcement by the holder of a future interest for the period from which that latter’s right to possession commences.
The possibilities for postponement of the standard period illustrate that 12 years’ adverse possession may not suffice to acquire possessory title. The dispossessed person may have been a tenant. He may a life tenant. He may be underage or lack mental incapacity. Acknowledgements may have been made in the past. In such circumstances, a possessory title may bee sold with insurance to cover against the above risks.
Mortgages and Personal Representatives
The Statute of Limitations provides that the mortgagee’s right of action for possession must be enforced within 12 years. This will not generally occur until the mortgage becomes enforceable upon demand for the entire loan monies. The mortgagee’s right to enforce is barred after 12 years.
Interest ona mortgage is barred after six years. The right to recover the principal itself is barred after 12 years. If a person acquires title to land which is mortgaged, it would appear that the mortgagee i.e. lender loses the title at the same time as to mortgagor.
The time limit for taking a claim against the personal representative of a deceased person is six years. Where the personal representative himself seeks to recover to recover possession of land from another, the standard 12 year limitation period applies.
The general principle is that a trustee or fiduciary may not acquire title to trust assets by adverse possession. A personal representative is owes fiduciary duties. This formerly had the consequence, that he could not acquire title by possession against a beneficiary. However, because it is common for family property, such as a farm to pass by possession, the legislation provides the time may run in favor of personal representative, who take a grant and remain in possession.
Post Lease
Where a tenant remains in possession after his lease has terminated, without paying rent, the Statute of Limitations period make commence to run in his favor. In the case of a lease, it will be clear when the term has terminated. In the case of tenancies which are not in writing or which run from period to period, such as year to year or less, the time to commence legal action commences at the end of the tenancy or date of last rent receipt, if later. A tenancy at will is one with no fixed period. The Statute of Limitation period ends one year after it begins unless it is terminated earlier.
Equitable Relief
The Statute of Limitations does not affect the jurisdiction of the courts to refuse equitable relief on the grounds of delay. See our chapters generally on equitable remedies and defence. This discretionary right of the Courts of Equity to deny equitable relief on account of delay, operates separately from the Statue of Limitations..
The identical English legislation on the loss of title by adverse possession, was challenged on the basis of incompatibility with the Human Rights Act. After being found incompatible with the European Convention on Human Rights by the House of Lords/UK Supreme Court with whom the First Instance chamber agreed, the Grand Chamber of the European Court of Human Right, by ten to seven, upheld the consistency of the former England and Wales Statute to Limitations on property, as compatible with the European convention and human rights. This former England and Wales system is identical to the Republic of Ireland system