by John Wojtowicz (Director - Law Central Legal)

Adverse possession is sometimes known as ‘squatter’s rights’ and has become a rather hot topic due to a recent occurrence of adverse possession in New South Wales. In late 1998, Mr Gertos happened to notice an empty and derelict house. He made some inquiries about the owner and then inspected the property to satisfy himself that the property was not occupied. The next day he hired a builder to fix up the property and change the locks. He subsequently took possession of the property despite having no legal title of ownership. He organised a managing agent for the property to be rented and signed a lease as the landlord. 19 years later in 2017, Mr Gertos made an application to become the registered property owner under the law of adverse possession. The Registrar-General made several enquiries before giving notice in late 2017 of intention to grant the application. The property was last owned by a Mr Henry Downie who had passed away long before Mr Gertos took possession. Mr Downie’s daughter and grandchildren applied for an injunction preventing the Registrar General from granting the application. The case was then required to go before the Courts to decide who was to have the title to the property. 

On the 30^th of October 2018 the New South Wales Supreme Court handed down a judgement on the issue in the case of McFarland v Gertos [2018] NSWSC 1629. The Court enforced Mr Gertos’ right to possession and dismissed the claim brought by Mr Downie’s family. This has led to some public debate as to whether the law of adverse possession should still exist. It has also left many people wondering what adverse possession is and how do you actually establish adverse possession?

What is Adverse Possession?

Adverse possession occurs when someone has an intention to possess the land and has uninterrupted possession of that area for the requisite period of time. If this occurs then the adverse possessor can make a claim to the title of the land. The cases that attract the most attention are those like McFarland v Gertos where someone manages to take the title for a whole property and any buildings on it. However, these cases do not occur all that frequently and are less common than other types of adverse possession. More often, adverse possession will relate to a boundary dispute. A person may make an adverse possession claim over a boundary for many reasons, including: a mistake in the fence line; a miscalculated survey; a mistake in a subdivision; or just an overlooked portion of land. In all of these cases, the person who possesses the land may make a claim for ownership, despite the fact someone else is listed on the title as being the owner. 

What is required to establish Adverse Possession?

In general, to establish adverse possession you must have an intention to possess the land and uninterrupted possession of that land for the requisite period of time. The specific elements which were required to establish adverse possession were looked at by the Victorian Supreme Court of Appeal in the case of Whittlesea City Council v Abbatangelo (2009). In that case, the Court outlined the following principles and requirements:

• in the absence of evidence to the contrary, the person with title to the land is assumed to be in possession of the land and have the right to possession of the land;
• if the law is to find someone apart from the title holder was legally in possession of the property, the person must establish they had both factual possession and the requisite intention to possess (both of these elements will be discussed further down); and
• the possession must continue uninterrupted for the required amount of time.

Factual Possession

To establish factual possession it must be proven that the claimant has taken physical control of the property. For the purposes of factual possession, it is not enough to simply be on the land. The possession must also be open for the public to see. If someone is secretive and attempts to hide the fact they are on the land, they will not be deemed to have factual possession. The possession must also be peaceful. If someone only has possession of the land because they have obtained that possession by force, it will not satisfy factual possession. The possession also needs to be adverse and not by consent of the true owner of the land. If the owner has given someone permission to reside on the land, they will be unable to establish factual possession for the purposes of adverse possession.

Establishing factual possession will depend on the individual facts of the case. Each element needs to be considered in light of individual circumstances. What will constitute open possession in one case, may not establish it in a different case. Parking on the driveway in a built up urban area might establish open and not secretive possession. However parking on the driveway in a rural property which is out of sight of passers-by, may not constitute open possession. In a claim for adverse possession the onus on establishing factual possession lies with the person claiming adverse possession. 

Intention to Possess

The intention to possess is sometimes called the animus possidendi. Whether the requisite intention exists will depend on an analysis of the entire circumstances of the possession. It is not necessary to prove that the possessor had a conscious intention to exclude the true owner of the property. Instead, what is required is an intention to exercise exclusive possession in a manner akin to the intention of the true owner. This will generally be shown where the possessor has undertaken acts which give them exclusive control of the land. One of the most effective acts for establishing the intention to possess is to fence the land off. Where a person has fenced an area off, they will likely have demonstrated an intention to control the land and exclude others from the land. This intention is akin to the intention which would be held by the true owner of the land.

Once it can be established that a person has both factual possession and the intention to possess, the law will view that person as having possession of that land for the purposes of adverse possession. It must then be established that the possession occurred for the relevant period for that state.

Gold and Platinum members read on for information on the required time period for each state and the legal principles for establishing the time period.

Disclaimer: The content of this Bulletin is general information only. It is not legal advice. Law Central recommends you seek professional advice before taking any action based on the content of this Bulletin.

Related documents:

• Co-Owners Agreement
• Family Trust
• Confidentiality Agreement
• Commercial Lease

Related webinars:

• Estate Planning Basics For Professional Advisers