REF/2007/0978

THE ADJUDICATOR TO HER MAJESTY’S LAND REGISTRY
LAND REGISTRATION ACT 2002

IN THE MATTER OF A REFERENCE FROM HM LAND REGISTRY

BETWEEN

CRESCENT FARMING COMPANY LIMITED

APPLICANT

and

(1) BELLWAY (BUILDERS) LIMITED
and
(2) BEAZER HOMES LIMITED

RESPONDENTS

Property Address: Land at East Hartford Farm, Cramlington, Northumberland

Title Number: ND148407

Before: Mr Michael Michell sitting as Deputy Adjudicator to HM Land Registry

Sitting at:  Newcastle SSCA, Manor View House, Kings Manor, Newcastle 
On: 27 January 2009

Applicant Representation: Mr Michael Driscoll Q.C., instructed by May, May and Merriman 
Respondent Representation: Mr Michael G. Hill, instructed by Ward Hadaway 

___________________________________________________________________________

DECISION
___________________________________________________________________________

POSSESSORY TITLE – POSSESSION – WHETHER POSSESSION FOR 12 YEARS REQUIRED 

Cases referred to
Asher v Whitlock [1865] QB p.1
Perry v Clissold [1907] AC 73
Fowley Marine (Emsworth) Ltd. v. Gafford [1968] 2QB 618
J.A Pye (Oxford) Ltd v. Graham [2002] UKHL 30
Simpson v Fergus  (2000) 79 P & CR 398

1.	Crescent Farming Company Limited (“Crescent”) applied on 11th August 2006 to be registered as proprietors with possessory freehold title of land at East Hartford Farm, Cramlington, Northumberland (“the Application Land”).  The Application Land is the site of the southernmost section of a drive or road linking the adopted highway with the cluster of buildings comprising East Hartford Farmhouse and 1 and 2 East Hartford Farm Cottages and associated farm buildings.  Notice of the application was given to the Respondents, who claim to have exercised an option to buy land at East Hartford Farm but do not claim to have title to the Application Land.

2.	I viewed the Application Land on 26 January 2009 accompanied by the representatives of both parties.  Tarmac has been laid across most but not all of the width of the Application Land forming a road.  The Application Land is separated from land to the east by a wooden fence about 1 metre high.  The fence comprises wooden planks about 10 centimetres wide fixed to rails, the planks being each fixed at an angle of about 75 degrees to the ground and with a gap of a few centimetres left between each plank.  The rails to which the planks are fixed and the posts that support the rails are on the east side of the fence.  The fair side of the fence is thus the side facing the Application Land.  The fence has been treated with a green wood stain.  There is a verge of less than a metre between the fence and edge of the tarmac.  On the west side of the Application Land and dividing it from the field to the west is a traditional thorn hedge.  The hedge had obviously been trimmed fairly shortly before my visit.  There is a wide mud and grass verge approximately 2 to 3 metres wide between the hedge and the western edge of the tarmac.  The northern end of the Application Land is marked on the west side by a small section of wooden post and rail fence across the western verge at right angles to the hedge.  The tarmaced road continues northwards.  The northern boundary is a straight line continuing the line of the rear garden fences of the house on the east side of the Application Land and other houses lying further to the east. At the southern end of the Application Land is a metal gate hanging on a metal gate-post, which stands beside the wooden fence.  The gate is wide enough to close off the full width of the tarmaced roadway when closed.  On the east side of the roadway is a metal post against which the gate closes.  The gate is constructed so that it may be padlocked to the post against which it closes but there was no padlock on the gate or post at the time of my view.  The words “Private Road Keep Out” have been painted in white on the gate.  Running between the gate post on the west side of the tarmaced area and the hedge is another section of wooden fence, constructed in much the same way as the fencing on the eastern side of the roadway.  The fair side of this fence faces away from the Application Land.  On the fair side of the fence and readable as you approach the Application Land from the south is a painted notice reading “Private No Public Right of Way”.  There is a telegraph pole in the corner between the hedge and this section of fence.  Fixed to the pole is another notice; this one states “Private Road”.

3.	I am grateful for the assistance of Mr Driscoll Q.C. and for Mr Hill, counsel for the Applicant and for the Respondents respectively.  I have had the benefit of their written submissions made after the hearing as well as of their skeleton arguments and their submissions made at the hearing.

Title to East Hartford Farm
4.	The Applicant acquired title to the farmland at East Hartford Farm and the roadway leading from the Application Land to the East Hartford farmstead by a transfer dated 14th May 2007 from Northern Strip Mining Ltd (formerly Coal Contractors Ltd.). The farmland and roadway were transferred together with
“the right (so far as the Transferor can grant the same) to pass and repass with or without vehicles at all times and for all purposes over and along [the Application Land] for the purpose of access to and egress from the [farmstead] and/or any part or parts thereof from and to the public highway”.            
The transferor reserved 
“the right (in common with the Transferee and all others for the time being entitled to the like rights) to pass and re-pass with or without vehicles at all times and for all purposes over and along the [roadway] for the purposes of access to and egress from the [farmstead] and/or any parts thereof  from and to the public highway…”    

5.	Coal Contractors Limited had acquired East Hartford Farm (including the farmhouse, farmstead and the road) from William Leech plc and Bellway (Builders) Ltd by a conveyance dated 11th December 1984.  That conveyance did not include the Application Land and contained no express grant of any rights over the Application Land.

Respondents’ Standing
6.	The Respondents do not claim to be the paper owner’s of the Application Land but they claim to have the benefit of an estate contract protected by unilateral notices on the title of adjoining land owned by the Applicant. Mr Driscoll confirmed that he took no point as to the standing of the Respondents to object to his client’s application.

The Evidence
7.	The Applicant relied on the witness statement and statutory declaration of Mr David Stephenson as to what had been done on the Application Land while East Hartford Farm was owned by Coal Contractors Ltd..  Sadly, Mr Stephenson died on 9th December 2008.  I was asked to and do take account of what is set out in Mr Stephenson’s statutory declaration made on 19th June 2006 and his witness statement made on 24th June 2008, whilst bearing in mind that his evidence could not be tested by cross-examination.

8.	Mr Stephenson stated that Coal Contractors Ltd. laid tarmac on the Application Land in 1987 and thereafter repaired and maintained it and erected a metal gate and signs at the end of the Application Land in the late 1980s. 

9.	Mr Roderick Wilson, a director of the Applicant and Head Agent to the Duke of Northumberland and the Northumberland Estates gave evidence. The Applicant is owned by the trustees of the Ninth Duke of Northumberland’s Will Trust. His evidence was that between December 1998 and July 1999 the Applicant re-hung a gate on the southern end of the Application Land; that private signs were erected; that the Applicant erected and maintained fencing across part of the northern and southern ends of the Application Land; and that between 1998 and July 1999 the Applicant erected wooden fencing on the eastern side of the Application Land.  The fencing of which he spoke was the fencing I saw on the site visit. He also gave evidence that since December 1997 only the Applicant had repaired the roadway.  Mr Wilson also gave evidence that the Applicant maintained the hedge on the eastern side of the Application Land and the verges.  In cross-examination Mr Wilson said that the Applicant had replaced the gate on at least one occasion and had repaired it.  

10.	The Respondents did challenge the veracity of Mr Wilson’s evidence as to what work the Applicant had done on the Application Land.  I accept Mr Wilson’s evidence in this regard.

11.	Mr Wilson gave other evidence as to the Applicant’s reasons for putting up the signs and re-hanging the gate at the southern end of the Application Land.  In his statutory declaration made in support of the application, he said
“Private signs were erected and again this was to stop trespass both by foot and vehicle”
 In his witness statement, he said
“With regards to the gate, this was erected and marked Private in part because there had been problems with trespassers before we acquired the Farm”
but he went on  to say
“As I have said it was essential to [the Applicant] that access to the Farm was recognised and not interfered with.  The erection of gates and fencing and maintenance of the hedge and verges was undertaken by [the Applicant] in the belief that it was in unimpeded possession of the Application Land”.
In cross-examination, Mr Wilson said that the farmland was acquired by the Applicant because of its long-term development potential.  It was critical to achieve ownership of the Application Land in order to be able to realise that development potential and all that the Applicant had done on the Application Land since 1997 was done in order to achieve ownership.  Later in his cross-examination, Mr Wilson said that the Northumberland Estate had applied for planning permission to redevelop the farmyard and that ownership of the Application Land was necessary so that a section 106 agreement could be entered into.

12.	Mr Wilson stated in his witness statement that the erection of the gates and fencing and maintenance of hedges and verges was undertaken by the Applicant in the belief that it was in unimpeded possession of the Application Land.  In his evidence in chief, he stated that it was critical for the Applicant to achieve ownership of the Application Land and that all that the Applicant did from 1997 onwards was done in order to achieve ownership.  

13.	There was evidence that others had passed over the road on the Application Land.  Tenants of the Applicant and their visitors used the land to get to the farm.  Members of a fishing club passed over the land on foot to get to the bank of a river to the north.  Mr Wilson considered that members of the fishing club had the consent of the Applicant to walk over the Application Land although no document granting permission was produced.  Further a Mr and Mrs Chart, who built the bungalow to the immediate east of the Application Land had put a gate in the rear fence of their rear garden which gate led onto the Application Land or onto that part of the land that is immediately to the north of the Application Land.  Mr Wilson’s evidence was that Mr and Mrs Chart had asked permission to put in the gate and the Applicant had given consent.  Mr Wilson also said that the people who had acquired the bungalow from Mr and Mrs Chart had also asked for and been given permission to maintain the gate in the rear fence. I accept this evidence.

14.	Mr Hugill, a partner in firm of solicitors acting for the Respondents, gave evidence.  He gave evidence that he went to the Application Land on 18 October 2006.  There was on that occasion no lock on the gate and the gate was held open by a piece of wood.  Vegetation had grown up around the gatepost. He produced photographs taken by his colleague, Chontelle Wright, who accompanied him on his visit.  Miss Wright gave evidence confirming what Mr Hugill said.  Mr Graham Medcalfe, a senior land manager with Bellway Homes Limited (a company associated with the first Respondent) gave evidence that he visited the Application Land on 17 february 2008 and the gate was then open and a man was walking along the Application Land.
          
Requirements of Section 9(5) of the Land Registration Act 2002
15.	Mr Driscoll submitted that all it was necessary for the Applicant to establish in order for it to be registered with possessory title in a case in which no-one claiming to be the paper title owner objected, was that the Applicant was in possession of the Application Land (at the date of the application).  Mr Hill submitted that this was not enough and that it was necessary for the Applicant to establish that it and any earlier squatter had been in possession for a period of 12 years so as to bar the title of the paper owner under Section 15 of the Limitation Act 1980.

16.	Mr Hill also submitted that it was not open to the Applicant to seek to rely on less than 12 years possession because the original application was made on the grounds that the Applicant had been in possession for a period of more than 12 years.  I do not accept this submission.  The application by the Applicant is an application to be registered with possessory title.  If the facts established by the Applicant at the hearing are such that it is entitled to be registered with a possessory title then its application should succeed.  The case presented at the hearing for the Applicant was fully pleaded in the Applicant’s Statement of Case so the Respondents were not taken by surprise by the way in which the case was argued at the hearing.   

17.	It is to be noted that there is no evidence at all as to who is the paper title owner of the Application Land.  Therefore, it is unclear whether 12 years adverse possession would be sufficient to bar the title of the paper title owner.  The paper title could be vested in someone against whom time does not run or in the Crown, the title of which is barred only by 30 years adverse possession.

18.	The first statutory provision to be considered is Section 3 of the Land Registration Act 2002 9”the 2002 Act”).  That section provides inter alia 
“(1) this section applies to any unregistered legal estate which is an interest of any of the following kinds
(a)	an estate in land,
(b)	…
 (2) Subject to the following provisions, a person may apply to the registrar to be registered as the proprietor of an unregistered legal estate to which this section applies if -
(a)	the estate is vested in him, or
(b)	he is entitled to require the estate to be vested in him”.  
Therefore for a person to be entitled to apply to be registered in a case where the land is unregistered, he must have an unregistered estate vested in him.  Section 132 provides that legal estate has the same meaning as in the Law of Property Act 1925.  Section 205(1)(x) of the Law of Property Act 1925 provides as follows
“ ‘Legal estates’ means the estates interest and charges in or over land (subsisting or created at law) which are by this Act authorised to subsist or to be created as legal estates;…”  
Section 1 of the Law of Property Act 1925 provides as  follows 
“(1) The only estates in land which are capable of subsisting or of being conveyed or created at law are -
(a)	An estate in fee simple absolute in possession;
(b)	A term of years absolute.
(5) A legal estate may subsist concurrently with or subject to any other legal estate in the same land in like manner as it could have done before the commencement of this Act”.
	
19.	Section 9(1) of the Land Registration Act 2002 provides as follows
“In the case of an application for registration under this Chapter of a freehold estate, the classes of title with which the applicant may be registered as proprietor are – (a) absolute title,
(b) qualified title, and
(c) possessory title;
and the following provisions deal with when each class of title is available”. 

20.	Section 9(5) of the Land Registration Act 2002 provides as follows
“A person may be registered with possessory title if the registrar is of the opinion –
(a)	that the person is in actual possession of the land, or in receipt of the rents and profits of the land, by virtue of the estate; and
(b)	that there is no other class of title with which he may be registered”. 

21.	Section 10(1) and (6) of the 2002 Act are in similar terms but refer to the registration of a leasehold estate with possessory title. Section 10(6) provides that a person may be registered with possessory title if the registrar is of the opinion 
“(a) that the person is in actual possession of the land, or in receipt of the rents and profits of the land, by virtue of the estate, and
(b) that there is no other class of title with which he may be registered”.

22.	There is no express requirement in the 2002 Act that to be granted possessory freehold title, an applicant must have been in possession for any particular period of time.  However, Mr Hill submitted that the words “by virtue of the estate” meant that an applicant could only be registered with possessory title if he showed that he had been in possession for a period of 12 years.  He relied on passages from Ruoff and Roper On The Law And Practice of Registered Conveyancing . The editors of Ruoff and Roper state at 6.006
“On an application for the first registration of title to a freehold or leasehold estate the applicant may be registered with a possessory freehold or possessory leasehold title if the Registrar is of the opinion that the applicant is, by virtue of the estate in question, in actual possession of or in receipt of the rents and profits from, the land which is the subject of the application.  If, for example, a person applies for registration on the basis of adverse possession under the Limitation Act 1980, his possession will be by virtue of the estate of the documentary owner whose title has been extinguished.  The mere fact of possession is not sufficient by itself.  Where the applicant for first registration bases his title on adverse possession but the adverse possession has not been for the requisite period under the Limitation Act 1980, no class of title can be granted”.    
23.	No authority is given for the propositions set out in this passage.  Mr Driscoll QC submitted that the statement that the possession of the person in adverse possession is “by virtue of the estate of the documentary owner” is incorrect.  He drew my attention to the following passage in Megarry and Wade: The Law of Real Property at 4-003
“The Act does not transfer the dispossessed owner’s estate to the adverse possessor.  It merely extinguishes the earlier title, leaving the adverse possessor free from any claims under it.  He then has a new and independent freehold title, based upon his own possession”  
There is a similar passage at 35-056
“The squatter holds a new estate of his own, founded on his adverse possession and the absence of any better title, but he holds it subject to any third party rights which run with the land and have not themselves been extinguished”.  
I accept this submission. Section 17 of the Limitation Act 1980 provides what is the effect of the expiry of the relevant limitation period, as follows
“at the expiration of the period prescribed by this Act for any person to bring an action to recover land … the title of that person to the land shall be extinguished”.   
There is no transfer by the statute of the estate of the former owner to the adverse possessor for the estate of the former owner is “extinguished”.
  
24.	In Asher v Whitlock [1865] QB p.1 the issue was whether a trespasser who had been in possession of land had an interest capable of being devised.  Cockburn C.J. held that he had stating at p. 5
“It is too clear to admit of doubt, that if the devisor had been turned out of possession, he could have maintained an ejectment.  What is the position of the devisee? There can be no doubt that a man has a right to devise that estate, which the law gives him against all the world but the true owner”

25.	In  Perry v Clissold [1907] AC 73, Lord Mc Naghten said
“It cannot be disputed that a person in possession of land in the assumed character of owner and exercising peaceably the ordinary rights of ownership has a perfectly good title against all the world but the rightful owner”. 
and in Fowley Marine (Emsworth) Ltd. v. Gafford [1968] 2QB 618 at 634 Willmer L.J. said
“It is well established that a person in possession of land has a perfectly good title against the whole world but the rightful owner”. 

26.	These authorities show that a person in possession of land has an estate in land and that this is not dependant on his having been in possession for 12 years. Thus it can be said that a squatter who has been in possession for a period of less than 12 years is in possession “by virtue of an estate”, namely by virtue of the estate that he acquires by going into possession.

27.	 In my judgement, for the Applicant to succeed, it must show
(1) that it has an unregistered freehold estate;
(2) that it is in actual possession of the Application Land; and
(3) that it is in actual possession of the Application Land by virtue of an unregistered freehold estate.
If the Applicant is in possession of the Application Land then it has an “estate” at common law.  That estate is a freehold estate in the absence of any evidence that it is an estate for a term of years only.  The key question therefore is whether the Applicant is in possession of the Application Land 	

Possession
28.	In J.A Pye  (Oxford) Ltd v. Graham [2002] UKHL 30, Lord Browne-Wilkinson defined possession as follows:
	“… there are two elements necessary for legal possession:
1.	a sufficient degree of physical custody and control (“factual possession”);
2.	an intention to exercise such custody and control on one’s own behalf (“intention to possess”).”	 	    
Factual possession is further defined in a passage from the judgment of Slade J. in Powell v. McFarlane (1977) 38 P&CR 452 (expressly approved by the House of Lords in J.A Pye  (Oxford) Ltd v. Graham)
“The question of what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed …. Everything must depend on the particular circumstances, but broadly, I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so”. 

29.	The acts relied upon by the Applicant as amounting to possession of the Application Land are re-hanging a gate at the southern end, repairing that gate, erecting a small section of fence beside the gate at the southern end of the Application Land, erecting 2 signs by the gate at the southern end of the Application Land, maintaining the verge and trimming the hedge.  

30.	The erection of the signs is plainly not by itself sufficient to amount to possession.  In Simpson v Fergus  (2000) 79 P & CR 398 the issue was whether a squatter who had marked out parking spaces on a service road, erected notices stating that the spaces were for the benefit of his adjoining property only and chased off anyone who parked on the road was in possession of the parking spaces.  Robert Walker L.J. (as he then was) said (at p.402)
“Possession is a legal concept which depends on the performance of overt acts, and not on intention (although intention is no doubt a necessary ingredient in the concept of adverse possession).  It may or may not be sufficient in international law to annex an uninhabited and uninhabitable rock by planting a flag on it… But to establish exclusive possession under English law requires much more than a declaration of intention, however plain that declaration is”.
The erection of signs here seems to me to be comparable to raising a flag.  It does not amount to taking possession.  However, there are here other acts on which the Applicant relies.

31	In considering whether the other acts on the land amount to factual possession, I have regard to the nature of the land and the manner in which it is commonly used or enjoyed.  The land is in substance the extension of a road.  It is a strip of land with a partially metalled surface intended for the passage of vehicles.  It is used only to connect the public highway with the private roadway so as to provide access to the fields on each side of the road and the farmhouse and buildings at the far end of the road.  In my view by re-hanging and repairing the gate, erecting a section of fence, trimming the hedge and maintaining the verges the Applicant has been dealing with the land as an occupying owner would.  The fact that the gate has been left open from time to time and has sometimes been propped open with a piece of wood does not mean in my view that the Applicant has not had a sufficient degree of physical control to amount to possession, given that the nature of the land is a road over which vehicles, including tractors working in the nearby fields would have to pass.

32	There is no evidence that anyone other than the Applicant has been dealing with the land as an occupying owner would.  There is the evidence that others have passed along the road but this has been with the permission of the Applicant.  In so much as others may have walked over the Application Land without the Applicant’s consent, I do not consider that this means that the Applicant was not in possession.  The Applicant dealt with the Application Land as an occupying owner would and no-one else did.    

33	The erection of the signs provides in my view clear evidence that the Applicant intended to possess the Application Land.  They indicate that the Applicant intended to do more than simply acquire or protect a right of way.  It intended to possess the land by keeping so far as it was able, others off the land.  The fact that the Applicant did not put its name on the signs is not of significance.  

Period of Possession
34.	Mr Wilson’s evidence was that the gate was re-hung between December 1998 and July 1999 and that the signs were erected and the fencing erected also during this period.  This is that time that the Applicant took possession.  

34.	Mr Driscoll submitted that Coal Contractors Limited were in possession of the Application Land prior to the Applicant.  I am not satisfied that the Applicant was in possession.  Though it had erected a gate, there was no evidence that Coal Contractors Limited fenced the land from the adjoining land to the east or to the south.  The evidence was that the Applicant had erected the fencing that now stands.  It does not seem to me that Coal Contractors Limited had done sufficient to enable me to find that it was in possession.

Conclusions
35.	The Applicant has shown that it is in possession of the Application Land and has been in possession since at latest July 1999.  In my judgment, the Applicant is in possession of the Application Land by virtue of a freehold estate.  I shall order the Chief Land Registrar to give effect to the application of the Applicant to be registered with possessory title to the Application Land.

Costs
36.	My preliminary view is that costs should follow the event and accordingly that the Respondent should pay the Applicant’s costs of the proceedings to be assessed (if not agreed) on the standard basis.  Any party who wishes to make submissions as to liability for costs may do so in writing.  Any written submissions as to costs should be served on the Adjudicator and on the other party by 5pm on 6th May 2009. 

By Order of the Adjudicator

Dated 21 April 2009