Generay Ltd v Containerised Storage Company Ltd

For adverse possession of open land, a squatter must establish factual possession and an intention to possess. Deliberately fencing off part of the land to exclude himself may amount to discontinuance of possession, even where the exclusion is temporary and undertaken for litigation purposes. Temporary absence alone is different. The position of a squatter must be distinguished from that of a paper owner, whose possession may continue in law despite absence. Fencing is strong evidence but is not conclusive; its effect depends on what it shows about factual possession and intention. Under the Limitation Act 1980, an intervening lease postpones time running against the freeholder until expiry. The appeal was allowed only for the area excluded by the fence.

This was an appeal by the registered proprietor of a strip of land against a judgment of the Central London County Court given by His Honour Judge Cooke on 7 October 2002. The judge held that Generay had acquired title to the strip by adverse possession and gave judgment on the claim and counterclaim.

The appellant advanced three arguments. Two concerned whether parts of the strip fell within earlier leases, engaging the limitation rules in the Limitation Act 1980. The third concerned a temporary fence erected by Generay during separate trespass proceedings, which allegedly excluded Generay from part of the strip. The central issues were whether the lease objections defeated the claim and whether the temporary self-exclusion interrupted adverse possession, and, if so, what area was affected.

Disposition. The court unanimously allowed the appeal in relation to the third point only.

1. Leases and limitation. The relevant limitation period for adverse possession was 12 years, accumulated by the time possession proceedings were brought. Under section 15(1) and paragraph 4 of Schedule 1 to the Limitation Act 1980, time could run against a freeholder only after any relevant lease had ended. The first lease objection failed because the relevant part of the property had been surrendered by deed in 1974. The second failed because the lease plan showed that the triangle was outside the leased plot. The court declined to rely on inconsistent Land Registry plans, bearing in mind Rule 278 of the Land Registration Rules 1925.
2. Elements of possession. The court applied the analysis in JA Pye (Oxford) Ltd v Graham [2003] 1 AC 419. Legal possession requires both factual possession, involving an appropriate degree of physical control, and an intention to possess for one's own benefit. The intention ordinarily includes an intention to exclude the world at large, including the paper owner, so far as reasonably practicable.
3. Temporary self-exclusion. Fencing is strong evidence of possession or discontinuance, although it is not conclusive. The temporary fence was erected to show that Generay was excluding itself from the north-eastern part of the strip. A stranger claiming adverse possession of open land would require exceptional facts to establish that it retained possession while intentionally fencing itself off. The temporary and litigation-related nature of the exclusion did not alter that conclusion. Temporary absence alone would not suffice, but this was positive self-exclusion. Authorities concerning discontinuance by a paper owner did not establish the position of a squatter.
4. Extent and orders. The court determined that the northern run of the fence was about eight feet long, indicating that all or virtually all of the northern section was excluded, with the precise boundary to be agreed. The appellant was awarded 50 per cent of the appeal costs and Generay recovered 75 per cent of the trial costs. The question of trespass damages was remitted to the trial judge.

• Court of Appeal (Civil Division): In [2005] EWCA Civ 478, the appeal was allowed only in relation to the temporary fence and the affected part of the strip. Costs were apportioned and trespass damages were remitted to the trial judge.
• Central London County Court: On 7 October 2002, His Honour Judge Cooke held that Generay had acquired title to the whole strip by adverse possession and gave judgment on the claim and counterclaim.