Land Law - Adverse possession
Adverse Possession
What is adverse possession? It is more commonly known as squatters’ rights. On the surface adverse possession may seem unfair and very similar to stealing property, as one title transfers from one owner to the one owner without exchanging any consideration. This publication aims to clear up the difference between adverse possession and less scrupulous operators.
Why does Adverse Possession exist?
Basically, to reward and encourage the productive use of land. For example, many years ago before title tracking and registering was well maintained a family may have been farming a plot of land for many years only for a long- lost relative of a former owner to turn up and try to claim the land. If the land was controlled to the exclusion of others by someone that wasn’t the owner for the required time limit, they for all intents and purposes are the title holders and the act of registering the title is only a formality. This was more of an issue in the past, but still can occur in modern times.
Modern Adverse Possession
But Adverse possession does not occur very often at all in modern times. Adverse possession is a very lengthy process taking up to 12 years for a private title and 30 years for a crown title in NSW.[1] The different states and territories of Australia have different time periods. If someone wishes to adversely possess a property that individual or company does not actually have live in or occupy the property for the time limit, they just have to exercise control for 12 years. For adverse passion to be successful it cannot be done in secret or by force according to common law.[2] To help explain this we will briefly examine two recent adverse possession cases, one successful and one not.
In Mr Gertos case, he discovered an abandoned property in Sydney he instructed a solicitor to do some searches and the registered owner was found to be deceased by over 50 years and no application of probate had been launched. Mr Gertos took possession of the house by making the house secure and water tight, his accrual of time would have started on when he took possession and had new doors installed. It was argued that because Mr Gertors did not actually live in the house but rented it out to tenants that he did not possess the property.[3] However that argument was rejected as acting as the landlord was held to clearly signify an intention to possess the property.[4] Further MR Gertos did not do any of these actions in secret or by force.
However conversely in the Rosa Catherine case a Victorian police officer used her position to obtain information on potential properties.[5] Rosa would then have the locks changed while attempting to have documents changed into her name. Over the course of a year Rosa would attempt to Adversely possess six properties. Similarly, to Mr Gertos, Ms Rosa used a property management company to tenant the properties, however Ms Rosa did not fulfill the must be open and not secret requirements. Ms Rosa abused her position as a police officer multiple times telling officers called to one of her properties not to worry because she was a police officer. Using the polices database to find property owners details. Further Ms Rosa lied on statutory declarations and redirected mail to keep the real owners unaware of her actions. Ultimately Mr Rosa was sentenced to four years in jail.
Conclusion
In the case of Mr Gertos if the original title holders had arrived even one day before the twelve-year limitation period and told him to vacate the property, he would have lost his adverse possession attempt. Mr Gertos would not even be allowed to claim back any of the over 100 thousand he had spent on the property in the intervening years. This makes adversely possessing a property fairly risky as there can sometimes be huge costs in making the property profitable, combined with the risk of the true owner deciding to exercise control of the property. As can be seen adverse possession is still possible in modern times, if done legally. While Mr Gertos possession of the house may seem unfair to the owners grandchildren he did not engage in any fraudulent activity to gain the house.
[1] S 27 Limitation Act 1969 NSW
[2] McFarland v Gertos [2018] NSWSC 1629 At 53
[3] Ibid At 59
[4] Ibis At 68
If you have any inquiries or wish to receive further information, please contact:
John Park & Graham Hunt
M + (61) 410 626 909 / 1300 577 502 / johnpark@wwlp.com.au
Level 13, 2 Park Street, Sydney NSW 2000 / www.wentworthlaw.com.au