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Adverse possession and Pye v Graham
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Adverse possession and Pye v Graham

This article explains meaning of the phrase "adverse possession" as set out in Pye v Graham, the leading case on the topic. Other important issues that arise in adverse possession cases are dealt with on the other pages in this section of the site - see the contents column on the left.

Introduction

The phrase adverse possession is a convenient one. We are all familiar with it and the Land Registration Act 2002 continues to use it. Butterworths publish a book by that title. However, the word adverse has tended to confuse. It implies that the squatter should in some way be aggressive towards the paper owner of the property. However, in the leading case of J A Pye (Oxford) Ltd v Graham [2002] UKHL 30 the House of Lords made it abundantly clear that this is not so. As will be explained below the test is simply: Has the trespasser possessed the land for the requisite period using the ordinary meaning of that word? The main speech in the case was given by Lord Browne-Wilkinson. Except where otherwise stated the quotations in this article are from his opinion.

Background

Pye was the paper owner of the land. Graham was the squatter. The land was agricultural land in Berkshire that was ripe for development. It is apparently a prime site worth millions. As far back as 1977 it was recognised that it might have development potential but rather than leave the land empty Graham was allowed to occupy it for grazing. There was initially an informal licence in 1982 and in 1983 the parties entered into a written agreement whereby Graham was allowed to use the land from 1 February to 31 December 1983. It was described as a licence and even if it had been a tenancy would have been outside the protection afforded to agricultural tenancies. The agreement limited Grahams use of the land to grazing or mowing for one cut of grass and restricted the use of the land to the grazing of sheep, cattle and horses. It also expressly provided that any grazing after its expiry would have to be by a new and distinct contract. After the first written grazing agreement came to an end no further agreement was entered into. This was because Pye was advised that it would be more sensible to recover the land because of the possibility of development. Pye required Graham to vacate but he never did so. He remained in occupation farming the land. Pye did nothing about it until April 1998 when possession was claimed. Graham defended the claim and asserted that he had acquired title by adverse possession.

Key facts

The most important facts relied upon by the House of Lords in deciding that Graham clearly established adverse possession were as follows:
  • Apart from gates allowing access, all the boundaries of the disputed land are separated from the adjoining land by hedges.
  • On one boundary there is a gate. At all material times that gate had been padlocked, the key to the padlock being held by Graham.
  • Graham owned and farmed the adjoining piece of land.
  • From 1 January 1984 (when the grazing agreement) came to an end until the claim for possession Graham farmed the disputed land continuously. Graham did more than merely graze the land. This was done without the permission of Pye.
  • The boundary hedges were trimmed every year and the boundary fences and ditches were maintained by Graham.
  • Various witnesses gave evidence that the land appeared to be part of Manor Farm and some gave evidence that they believed that he owned the disputed land.
  • Pye's expert witness, an experienced chartered surveyor, when asked in cross-examination what an occupying owner of the disputed land might have done over and above what had been done by Graham replied that he was unable to think of anything.
  • Graham would have entered into further formal agreements but despite requests to Pye these were never offered. He simply therefore continued to use the land without challenge.

Path to the House of Lords

These were clearly strong facts in favour of finding that Graham had acquired title by adverse possession and Neuberger J reluctantly held in favour of Graham. He was reluctant because it meant that the Grahams would be able to retain a piece of land that did not belong to them, which they had farmed for nothing for years and which was worth a fortune, all because Pye had inadvertently overlooked the position.

The Court of Appeal disagreed and made an order for possession. They thought they had found a way round the problem by holding that Graham continued to hold pursuant to the permission originally given in the grazing agreement.

This was clearly stretching it and the House of Lords has now restored the decision of Neuberger J. Unfortunately, Mr Graham the farmer died in a tragic shooting accident before the trial. His widow continued the action and has now inherited a property worth a fortune.

Limitation Act 1980

As is well known the limitation period in respect of claims to recover land (where the Land Registration Act 2002 does not apply) is 12 years from the date on which the right of action accrued (s15(1) of the Limitation Act 1980). Schedule 1 of the 1980 Act determines when the right of action accrued:
    "Schedule 1, paragraph 1: Where the person bringing an action to recover land has been in possession of the land, and has while entitled to the land been dispossessed or discontinued his possession, the right of action shall be treated has having accrued on the date of the dispossession or discontinuance.

    Schedule 1, paragraph 8(1): No right of action to recover land shall be treated as accruing unless the land is in the possession of some person in whose favour the period of limitation can run (referred to below in this paragraph as adverse possession); and where under the preceding provisions of this Schedule any such right of action is treated as accruing on a certain date and no person is in adverse possession on that date, the right of action shall not be treated as accruing unless and until adverse possession is taken of the land."
Thus, as Lord Browne-Wilkinson has now reminded us, in Pye v Graham all the statute actually requires is that the squatter should be in possession. It then uses the phrase adverse possession as a shorthand term to describe his possession in order to avoid unnecessary statutory repetition. Under some very old law there had been a concept of adverse possession but this had caused problems and was abolished in 1833. The phrase continued to have an influence on judicial decisions particularly as a result of the infamous case of Leigh v Jack (1879). However, it was not restored as a statutory phrase until the Limitation Act 1939:
    "From 1833 onwards, therefore, old notions of adverse possession, disseisin or ouster from possession should not have formed part of judicial decisions. From 1833 onwards the only question was whether the squatter had been in possession in the ordinary sense of the word. That is still the law After 1833 the phrase adverse possession did not appear in the statues until, to my mind unfortunately, it was re-introduced by the Limitation Act 1939. In my judgment the references to adverse possession in the 1939 and 1980 Acts did not reintroduce by a side wind after over 100 years the old notions of adverse possession in force before 1833 (paragraph 33).

    Many of the difficulties with these sections are due to a conscious or subconscious feeling that in order for a squatter to gain title by lapse of time he has to act adversely to the paper title owner. It is said that he has to oust the true owner in order to dispossess him; that he has to intend to exclude the whole world including the true owner; that the squatters use of the land has to be inconsistent with any present or future use by the true owner. In my judgment much confusion and complication would be avoided if reference to adverse possession were to be avoided so far as possible and effect given to the clear words of the Acts. The question is simply whether the defendant squatter has dispossessed the paper owner by going into ordinary possession of the land for the requisite period without the consent of the owner. (Paragraph 36)."

Possession

What then constitutes possession in the ordinary sense of the word? Lord Browne-Wilkinson confirmed that there are two elements to possession: (i) factual possession and (ii) intention to possess:
    "What is crucial is to understand that, without the requisite intention, in law there can be no possession. [T]here has always, both in Roman law and in common law, been a requirement to show an intention to possess in addition to objective acts of physical possession. Such intention may be, and frequently is, deduced from the physical acts themselves. But there is no doubt in my judgment that there are two separate elements in legal possession. So far as English law is concerned intention as a separate element is obviously necessary. (Paragraph 40). "

Factual possession

In discussing factual possession Lord Browne-Wilkinson quoted Slade J in the case of Powell v McFarlane (1977) 38 P&CR 452 at 470:
    "Factual possession signifies an appropriate degree of physical control. It must be a single and [exclusive] possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on that land without his consent cannot both be in possession of the land at the same time. The question 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 the 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 as an occupying owner might have been expected to deal with it and that no-one else has done so."
Lord Browne-Wilkinson confined himself to agreeing with this statement of the law which was all that was necessary in the case:
    " The Grahams were in occupation of the land which was within their exclusive physical control. The paper owner, Pye, was physically excluded from the land by the hedges and the lack of any key to the road gate. The Grahams farmed it in conjunction with Manor Farm and in exactly the same way. They were plainly in factual possession..." (Paragraph 41).

Intention to possess

In dealing with this element Lord Browne-Wilkinson confirmed a number of previously established propositions:
  • The intention required of the squatter is to possess not to own. He repeated the formula of Slade J in Powell at 471: "The requirement is of an intention, in ones own name and on ones own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow" (Pye, paragraph 43).
  • The acts of the squatter do not need to be inconsistent with the intentions of the paper owner (as had previously been suggested in Leigh v Jack). "The suggestion that the sufficiency of the possession can depend on the intention not of the squatter but of the true owner is heretical and wrong." (Paragraph 45).
  • The fact that the squatter is willing to pay a rent or take a lease if asked does not mean that he does not intend to possess. "Once it is accepted that the necessary intent is an intent to possess not to own and an intention to exclude the paper owner only so far as is reasonably possible, there is no inconsistency between a squatter being willing to pay the paper owner if asked and his being in the meantime in possession." (Note: The fact that the squatter believes that he has a tenancy does not mean that he does not have an intention to possess. He obviously does (Ofulue v Bossert [2008] EWCA Civ 7).

Possession with consent

If a person is in possession with the consent of the owner then he does not have sufficient possession for the purposes of the Limitation Act:
    "It is clearly established that the taking or continuation of possession by a squatter with the actual consent of the paper title owner does not constitute dispossession or possession by the squatter for the purposes of the Act. Beyond that the words possess and dispossess are to be given their ordinary meaning. (Paragraph 37)."
The Grahams had originally been in possession with the consent of Pye. However, after the expiry of the written grazing agreement at the end of 1983 they were clearly in possession without Pyes consent:
    "In a letter from Pye's agents dated 30 December 1983 the Grahams were expressly required to vacate the disputed land. But the Grahams did not vacate either then or at any later date. They spread dung on the land, harrowed it and rolled it. They overwintered dry cattle and yearling in a shed on the land. From 1 January 1984 onwards the Grahams repeatedly did things on the disputed land, which they would have had no right to do under the old grazing agreement even if it had still been in force. The objective facts demonstrate that the Grahams made such use of the disputed land as they wished irrespective of whether it fell within the terms of any hypothetical grazing agreement. (Paragraph 58)."

Human Rights

In the Court of Appeal Pye had argued that the Human Rights Act 1998 and Article 1 of the First Protocol of the Convention applied. However, by the time the matter was before the House of Lords Pye conceded that that the Act did not have retrospective effect. The court had heard this case before the Act came into force on 2 October 2000.

(Subsequently Pye sued the Government for damages on the basis that it had been deprived of its property by a law that was contrary to the European Convention on Human Rights. The saga was a long drawn out one but eventually Pye lost. See further here.)

Conclusion

Whilst acknowledging that the Grahams had acted honourably throughout their Lordships recognised the injustice of the decision. The Grahams were not at fault in any way. They had simply remained in possession willing to pay a rent if asked but the result of Pye's inaction was that they enjoyed the full use of the land without payment for 12 years. As if that were not gain enough, they are then rewarded by obtaining title to this considerable area of valuable land without any obligation to compensate the former owner in any way at all (Lord Bingham).

As a result of the Land Registration Act 2002 the law has now changed radically in relation to registered estates. (See LRA and adverse possession.) In a case such as Pye v Graham, where the squatter had not run up 12 years adverse possession prior to the 2002 Act coming into force on 13 October 2003, the squatter would (putting it simply) have to show that for at least 10 years of the period of adverse possession ending on the date of the application he reasonably believed that the land to which the application relates belonged to him (Schedule 6, paragraph 5). In Pye the Grahams knew perfectly well that the land did not belong to them. They would not therefore have succeeded under the new regime.

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