England and Wales Land Registry Adjudicator

 

 

 

REF/2004/0014

 

 

The Adjudicator to Her majesty’s Land Registry

LAND Registration act 2002

 

IN the matter of a reference from hm land registry

 

 

BETWEEN

 

Terence Charles Palmer

 

APPLICANT

 

and

 

Beaulane Properties Limited

 

RESPONDENT

 

 

Property Address: Gravel workings on the south west side of Cranford Lane, Harlington

Title Number: AGL118943 & NGL339357

 

 

Before: Mr Edward Cousins sitting as The Adjudicator to HM Land Registry

 

 

DECISION WITHOUT A HEARING
IN ACCORDANCE WITH RULE 33 OF THE ADJUDICATOR TO HM LAND
REGISTRY (PRACTICE AND PROCEDURE) RULES 2003

 

KEYWORDS:– Land Registration Act 1925, s 75 - Human Rights Act 1998, ss. 2,3 - Limitation Act 1980, s 17 – Article I, First Protocol, Convention for the Protection of Human Rights and Fundamental Freedoms - Adjudicator to HM Land Registry (Practice and Procedure Rules) 2003, r11 - stare decisis -

 

Cases referred to: Pye v Graham [2003] 1AC 419; Pye v The United Kingdom [2008] 46 EHRR 45; Ofulue v Bossert [2008] EWCA CIV 7; Beaulane v Palmer [2006] Ch 79;

THE APPLICATION

1.                  On 6^th October 2003 an Application in form FR1 was made by Mr Terence Charles Palmer (“Mr Palmer”) to HM Land Registry pursuant to the provisions of section 75 of the Land Registration Act 1925 (“the 1925 Act”) for registration of certain land and premises described as the “gravel workings on the south west side of Cranford Lane, Harlington” which comprises a field of 2.35 acres (“the Disputed Land”). The registered proprietor of the Disputed Land was Beaulane Properties Limited (“Beaulane”) which was registered on 6^th October 1992 under title number NGL339357. Mr Palmer claims to have acquired title to the Disputed Land by adverse possession and was supported by a statutory declaration dated 25^th July 2003. I shall hereafter refer to this as Palmer v Beaulane.

 

2.                  Notice of the Application was served on Beaulane as the registered proprietor of the Disputed Land, and on Barclays Bank Plc as chargees thereof, by a notice dated 13^th October 2003. Thereafter Beaulane objected to the Application on the grounds set out in the letter from their solicitors, Messrs Vymans, dated 10^th November 2003.

 

3.                  On 19^th January 2004 the dispute was referred to this Office on the basis of the objection to the Application in accordance with the provisions of section 73(7) of the Land Registration Act 2002 (“the 2002 Act”).

 

4.                  As the matter has a somewhat unusual history it is necessary to have regard to the background circumstances surrounding the Application.

 

THE BACKGROUND TO THE APPLICATION

The referral

5.                  The 2002 Act came into force on the 13^th October 2003 together with the Land Registration (Referral to Adjudicator to HM Land Registry) Rules 2003 and the Adjudicator to HM Land Registry (Practice and Procedure) Rules 2003 (“the Practice and Procedure) Rules 2003”).

 

6.                  This referral was, therefore, one of the earliest cases referred to this jurisdiction from HM Land Registry. On the 26^th January 2004 letters were sent to both parties naming them as the Applicant and the Respondent, respectively, providing details of the procedural process that each side was to undertake in order for the case to be resolved in due course. This included the service of statements of case by both sides. This process, however, was immediately foreshortened by virtue of the fact that in a letter dated 30^th January 2004 Beaulane’s solicitors wrote to confirm to this Office that Beaulane had commenced legal proceedings in the Chancery Division of the High Court in relation to the dispute. Copies of the Claim Form and Particulars of Claim which were to be served on Mr Palmer were enclosed. In fact, although nothing turns on it, as the jurisdictions operate in parallel, the Claim Form was issued prior to the case being referred to the Adjudicator as the proceedings were issued on 15^th January 2004. In the light of the above a request was made that the proceedings before the Adjudicator should be stayed pending the outcome of the High Court proceedings. I shall hereafter refer to this as the Beaulane case or Beaulane v Palmer.

 

7. Accordingly on 3^rd February 2004 a direction was made that the proceedings before the Adjudicator would be stayed pending the outcome of the legal proceedings commenced by Beaulane. This direction was made pursuant to the provisions of rule 11 of the Practice and Procedure Rules 2003. Rule 11 provides as follows: -

 

“Where court proceedings are commenced otherwise than following a direction to commence court proceedings under section 110(1), the Adjudicator may adjourn the whole or part of the proceedings before him pending the outcome of the court proceedings.”

 

8.                  For reasons to which I shall refer to below this case has continued to remain stayed. Thus this jurisdiction has not, as yet, given effect to or cancelled the original application in accordance with the powers granted to it under the 2002 Act.

 

The High Court proceedings – the Beaulane case

9. The matter then proceeded to trial and was heard by Mr Nicholas Strauss QC sitting as a Deputy Judge of the High Court. In these proceedings Beaulane sought an order restraining Mr Palmer from entering or using the Disputed Land and Mr Palmer counterclaimed on the basis that he was entitled to the land by dint of adverse possession. The hearing took place over several days in November 2004 and the judgment was handed down on the 23^rd March 2005. The Deputy Judge’s judgment ran to 57 pages and 226 paragraphs and contained an analysis of Mr Palmer’s claim to have acquired title by adverse possession and also Human Rights Act issues (see [2006] Ch 79).

 

10. Complicated issues arose as to the claim that the twelve year period for adverse possession under the Limitation Act 1980 included a period subsequent to the Human Rights Act 1998 (“the HRA 1998”) coming into force on 2^nd October 2000. Also it was contended that the transfer of the Disputed Land by adverse possession engaged and breached Beaulane’s right to peaceful enjoyment of its possession under Article 1 of the First Protocol (“Article 1”) to the European Convention for the protection of Human Rights and Fundamental Freedoms (“the Convention”). It was said that section 75 of the 1925 Act should be read and given effect to in such a way as to make it compatible with the Convention. Thus if on the facts of the case Mr Palmer completed 12 years uninterrupted adverse possession by the end of June 2003 the question was raised as to whether English law relating to adverse possession as it stood before 13^th October 2003 was compatible with the Convention, and if not whether the relevant statutory provisions could be read and given effect to in accordance with section 3 of the HRA 1998.

 

11. It is of importance to this Decision that the Deputy Judge made conclusive findings of fact in favour of Mr Palmer based upon disputed evidence heard by him on the adverse possession claim. He also went into some considerable detail in his judgment on the human rights issues. In this regard I refer to a number of paragraphs in his judgment under the heading “Adverse Possession”. In paragraph 47 (page 97) the Deputy Judge stated that it was not necessary for him to deal with the law relating to adverse possession in any detail as it by that stage had been clearly set out in the leading case in the House of Lords of Pye v Graham ([2003] 1AC 419). He then refers to the two limbs necessary to be established namely sole and exclusive possession and requisite intention.

 

12. In paragraph 48 (page 97) it is stated as follows: -

“It is common ground that, if Palmer’s evidence is accepted in its entirety, he has had exclusive possession of the disputed field since he became a trespasser in October 1986 as a result of providing secure fencing, padlocking the only entrance to the field other than the one from his own property, allowing horses to graze on it daily, agreeing to the work proposed by the Land Use Consultants and in effect giving away a small portion of the land to the neighbour. Clearly, if his evidence is correct, Mr Palmer also had the requisite intention. Indeed, it is accepted that as a result of mistaken legal advice, he believed from 1991 onwards that he was the owner…”

 

He then refers to the submissions made by Beaulane’s Leading Counsel in answer to this.

 

13. In paragraph 49 (pages 97/98) Deputy Judge then finds as follows: -

 

“Thus on this issue there is a stark conflict of evidence. I accept the evidence of Mr Palmer and his witnesses summarised at paragraph 18 above. As Mr Woolf [Leading Counsel forMr Palmer] submitted, it is overwhelming.”

 

The Judge thereafter summarises the evidence and then in paragraph 52 (page 98) finds as follows: -

“Accordingly, I find that, subject to the issues relating to the interruption of adverse possession between April and June 1991 [as to which he thereafter found in favour of the Mr Palmer – my note] … Mr Palmer has established his case that he has had exclusive possession of the disputed field since October 1986.”

 

Finally, in paragraph 63 (pages 100/101) the Deputy Judge concludes as follows: -

“For the reasons set out above, I find that, on the basis of section 75 of the [1925 Act] as normally interpreted, Beaulane became trustee of the disputed field for Mr Palmer on or about 27 June 2003, as a result of Mr Palmer’s having had exclusive possession of it for the previous twelve years with the requisite intention to exclude everybody else including the registered owner.”

 

Accordingly, he came to clear findings of fact on the adverse possession issue.

 

14. He then turned to the human rights issues. I do not need to refer to these issues in any great detail save to make the following observations – as I have stated above, the Deputy Judge found that there had been a period of adverse possession by Mr Palmer for more than twelve years and thus on the basis of section 75 of the 1925 Act, as normally interpreted, Beaulane became a trustee of the Disputed Land for Mr Palmer in June 2003. He further held, however, that any transfer would only have occurred after the HRA 1998 came into force and that the loss by an owner of the land by adverse possession in accordance with section 75 was incompatible with Article 1. Accordingly section 75 should be read and given effect by the court pursuant to its duty under section 3 of the 1998 Act in a way that was compatible with Beaulane’s rights under Article 1. He then went on to interpret the Limitation Act 1980 (“the 1980 Act) as not applying to facts such as in the Beaulane case where it was said that the use by the person claiming adverse possession was not inconsistent with the paper owner’s intentions in relation to that land. He therefore held that in accordance with that interpretation Mr Palmer’s possession had not been adverse and so his claim to have acquired the Disputed Land therefore failed.

 

15.              In adopting this approach the Deputy Judge felt bound to follow a line of reasoning developed in the case of Leigh v Jack (5 Ex D 264), and subsequent cases, to the effect that as a matter of domestic law adverse possession is established only when the claimant’s possession was inconsistent with the use or intended use of the land by the registered proprietor, and not merely that the possession was without the registered proprietor’s consent. This was despite the fact that this approach had earlier been described as a “heresy” by the House of Lords in Pye v Graham (at paragraph 45, p 438).

 

16.              The Deputy Judge thereupon dismissed the Mr Palmer’s counterclaim to be entitled to registration of the Disputed Land. He then ordered Mr Palmer to deliver up possession by 20^th April 2005, together with further orders as to the payment of the Respondent’s costs.

 

17. As can be seen from the judgment in the Beaulane case, the Deputy Judge had been made fully aware that the case of Pye v The United Kingdom was awaiting the judgment of the European Court of Human Rights which it was thought would be given within about 3 months from then. That case related to the compatibility of English law with the Convention on cases involving adverse possession. The judgment of the European Court of Human Rights in fact was not delivered until 15^th November 2005 and in that decision it was held that the English law of adverse possession was incompatible with Article 1, thereby effectively approving the decision of the Deputy Judge.

European Court on Human Rights - Pye v The United Kingdom

18. The United Kingdom then referred the decision to the Grand Chamber of the European Court of Human Rights as to the human rights issues and an oral hearing was held in November 2006. On 30^th August 2007 the Grand Chamber gave judgment holding by a majority that the loss by the paper title owner of land through adverse possession under English law was not a violation of Article 1. This decision brought finality to the case.

 

Court of Appeal - Ofulue v Bossert

19.              Any lingering doubts that might still have been held as to a final resolution of the question of the compatibility of adverse possession with the principles of human rights as a matter of English law have now been finally dispensed with in the recent case of Ofulue v Bossert ([2008] EWCA Civ 7). In this case the Court of Appeal had to consider a claim for adverse possession relating to a registered title the completion of which occurred just before the Land Registration Act 2002 came into force. Judgment was handed down on 29^th January 2008. The Court of Appeal directed itself to a number of issues for determination on the appeal.

 

20. The important issue for the purposes of my Decision was whether the Court of Appeal should follow Pye v The United Kingdom. This meant that the Court had to consider the doctrine of the margin of appreciation and legitimate aim and proportionality. Lady Justice Arden, who gave the leading judgment, held that every court should follow Pye v The United Kingdom, and other decisions of the Strasbourg Court which affect domestic law, unless there were very good reasons for departing from Strasbourg jurisprudence. Special circumstances justifying departure might exist if the domestic court was satisfied that the Strasbourg Court had misunderstood the effect of domestic law (see paragraph 32).

 

“In my judgment, it must follow from the obligation in s 2 [of the HRA 1998], as interpreted in cases such as Ullah, that in the absence of special circumstances (1) if domestic law within an area found by the Strasbourg Court to be within the contracting states’ margin of appreciation were challenged before an English court, the English court should consider whether the domestic rule serves a legitimate aim and is proportionate (according to the appropriate degree of respect to the decision-maker and domestic law) but then it should find that the law is Convention-compliant if those tests are satisfied; and (2) where the Strasbourg Court has itself already carried out this exercise, the English court should follow the decision of the Strasbourg Court.” (paragraph 37)

 

21. Lady Justice Arden went on to hold that the attempts made by the appellants in the Ofulue case to argue that it was open to the court to distinguish the decision in Pye on its facts or by reference to the applicability of policy reasons for adverse possession identified by the Law Commission in its Consultation Paper on the Limitation of Actions (Law Com 151-1998) fundamentally misunderstood the purposes of the doctrine of the margin of appreciation.

 

“The Strasbourg Court accepted that the national authorities could in general determine the rules for the extinction of title as a result of the occupation of the land by a person who was not the true owner. That determination applies to all decisions on adverse possession and it is not open to this court not to follow that determination because the case is distinguishable on its facts.” (Paragraph 52)

 

22. Lady Justice Arden also rejected the argument that the Court of Appeal must apply the test of legitimate aim and proportionality to each different case of adverse possession which arises. Again, she held that this approach fundamentally misunderstood the function of the court. The Strasbourg Court considered the compatibility with the Convention of the limitation period in the case of adverse possession with Article 1 and assessed its legitimate aim and proportionality as a general rule and not simply in the context of the specific facts of the Pye case, (see paragraph 53).

 

23. Finally, in paragraph 54 the Learned Lady Justice referred to the Strasbourg Court differing in its conclusion from that of the Deputy Judge in the Beaulane case. Despite the fact that counsel had filed lengthy submissions to the effect that Beaulane v Palmer was wrongly decided she did not consider that it was necessary to go into those submissions nor was she proposing to do so as an application had been made in that case for permission to appeal out of time.

 

24. Thus, in short, although the Court of Appeal in the Ofulue case did not expressly overrule the case of Beaulane v Palmer and the principle (or “heresy”) followed by the Deputy Judge in that case, for all intents and purposes Pye v The United Kingdom had settled the matter for the Court of Appeal.

The subsequent procedural stages in Beaulane v Palmer

25. Reverting to the position in the Beaulane case and the Application made in this jurisdiction, there was a long period of silence from Messrs Vymans, solicitors acting for Beaulane, between 30^th March 2005 and 14^th February 2007. However, in a letter from Beaulane’s solicitors dated 14^th February 2007, the Minute of Order of the Deputy Judge in the Beaulane case made on 23^rd March 2005 (entered in Chancery Chambers on the 13^th November 2006) was forwarded to this Office. In this letter it is stated that Mr Palmer had vacated the land and provided the solicitors with the keys, but it appeared that he had continued to maintain a pending land action registered at Swansea Land Registry. This Office was therefore asked to take the necessary steps to remove this pending land action as Vyman’s client could not deal with the property.

 

26.              A further letter was sent dated the 20^th February 2007 by Beaulane’s solicitors reiterating the urgency of the position. A response was sent on the instructions of the Adjudicator dated 21^st February 2007 referring to the fact that the case was originally adjourned to await the outcome of the case of Pye v The United Kingdom in the European Court of Human Rights and that the judgment of the Grand Chamber was still awaited. Reference was also made to the fact that if Beaulane was seeking to request that the Adjudicator made an Order cancelling the Application without a hearing that this was outside the powers of the Adjudicator as notice would first have to be given to the parties that that was his intention pursuant to rule 33 of the Practice and Procedure Rules 2003. It is to be added in this context that there seemed to be some confusion on the part of Beaulane’s solicitors as to the nature of the application made to the Land Registry by Mr Palmer in that this jurisdiction was seised of the Application made by Mr Palmer claiming adverse possession of the Disputed Land and not a pending land action. Further correspondence then ensued with Messrs Vyman on the issue as to whether or not there should be an immediate decision on the Application or whether it should await the judgment of the Grand Chamber between solicitors for both parties.

 

27. On 27^th March 2007 directions were given by the Adjudicator the essence of which was that he was intended to make a substantive decision in this matter without a hearing. The substantive decision which it was proposed to make was to direct the Chief Land Registrar to cancel the original application dated 6^th October 2003 to register title based on adverse possession. Following the directions made on 27^th March 2007 written submissions were received from both parties, and having considered such submissions further directions were made on 28^th June 2007 to the effect that the Adjudicator directed that the Application before him be further stayed pending the handing down of the judgment of the Grand Chamber in the case of Pye v The United Kingdom.

 

28. As I have stated above, on 30^th August 2007 the Grand Chamber gave its judgment. Three weeks later Mr Palmer sought permission to appeal the Beaulane decision, the date of filing of the Appellant’s Notice being 24 September 2007.

The Court of Appeal – Beaulane v Palmer

29.              On 21^st February 2008 the case was heard by the Court of Appeal (Sir Peter Gibson, Pill, LJ) the leading judgment being given by Sir Peter Gibson. The application before the Court of Appeal was an application for an extension of time in which to appeal and for permission to appeal from the order made by the Deputy Judge. Consideration was directed to the length of time that had ensued between the original judgment and the lodging of the Appellant’s notice, being some two and a half years, and the events which had taken place during that period, particularly as to any efforts made to seek or agree extensions of time.

 

30.              The Court of Appeal was not persuaded that an extension of time should be granted in the circumstances, the Court holding that to allow a hearing of an appeal out of time was to be treated as exceptional, it being a fundamental principle that the outcome of litigation should be final, and that it is of high public importance that time limits should be observed (see paragraph 37). Reference was also made to the checklist in CPR 3.9. Having regard to the totality of the circumstances as well as the particular matters to which rule 3.9 required attention, and the overriding objective, the conclusion was reached that it was not a case in which it was appropriate to extend time (see paragraph 50).

 

31. Of importance to the considerations of which I am currently seised it is necessary to have regard to two paragraphs of the judgment of Sir Peter Gibson, namely paragraphs 10 and 49.

 

“10. The United Kingdom then appealed to the Grand Chamber. The oral hearing was in November 2006. On 30^th August 2007 the Grand Chamber gave judgment, holding by a majority that the loss by the paper owner of land through adverse possession under English law was not a violation of Article 1. It is acknowledged that Mr Palmer, were he to be allowed an extension of time and permission to appeal, would have at least a good arguable case of success on the appeal. I think that is putting it very much on the low side and that there would be a strong probability that the appeal would succeed.

49. Circumstance (i) [of rule 3.9], the effect which the granting of relief would have on each party, is a consideration which leads to the court taking into account the fact that if an extension of time were granted, Mr Palmer is likely to succeed on the appeal. A further consideration has been suggested by Mr Underwood [Leading Counsel for Mr Palmer] is that the Adjudicator would be left, in the event of this court deciding not to grant an extension, with a very difficult task. He says that there is on the one hand the judge’s erroneous conclusion on the human rights issue, which the Adjudicator might feel obliged to follow, but on the other there is the fact that the Grand Chamber in the Pye case has shown why the judge’s decision is likely to have been wrong in law. Mr Knox [Leading Counsel for Beaulane] to my mind supplied the answer to that by pointing to the fact that the judge and his order dismissed Mr Palmer’s counterclaim which sought registration of his interest acquired by adverse possession. If an extension of time is refused, the judge’s decision to dismiss the counterclaim stands and the Adjudicator is therefore likely to have to dismiss the application still pending before him.”

 

 

32. Thus, in short, the Court of Appeal dismissed Mr Palmer’s application for an extension of time on a procedural basis, the result of which is that Mr Palmer’s appeal against the dismissal of his counterclaim to the claim brought by Beaulane has never been substantively heard. In this context, however, the Beaulane decision, however, has effectively been overruled by Pye v The United Kingdom ([2008] 46 EHRR 45) as interpreted by the recent case in the Court of Appeal of Ofulue v Bossert [2008] EWCA CIV 7.

 

33. Subsequently, a number of submissions have been made by the solicitors for both sides as to whether or not I should give effect or to cancel the Application made by Mr Palmer. I do not propose to repeat these other than to say that Messrs Seakens for Mr Palmer have endeavoured to encourage me to take a bold step and give effect to the Application despite the fact that the Beaulane v Palmer has not been overruled by the Court of Appeal and there has been no judgment on his counterclaim which stands dismissed. In the approach I adopt in this Decision I take into account the last sentence of paragraph 49 of the judgment of Sir Peter Gibson, to which I have referred above.

 

THE DECISION

34. Thus, despite the entreaties manifested by Mr Palmer’s solicitors in their written submissions to me, I must exercise caution in my approach to the Application made by Mr Palmer. It is with some regret that I am unable to come to any other conclusion than I must direct the Registrar to cancel the original application. I consider that I am bound by the Beaulane decision as Mr Palmer’s counterclaim was dismissed by the Deputy Judge and remains so dismissed. I must follow the principle of stare decisis and also the approach usually adopted by the courts that it is not possible to go back in time, as it were, to reopen a previous decision even if the legal principles may have changed following a subsequent decision. In short I consider that I have no power to go behind, as it were, the Beaulane decision. I shall accordingly make the appropriate direction to the registrar to this effect.

 

35. The circumstances of this case, however, are most unusual and in my judgment unsatisfactory. I have therefore in my discretion come to the conclusion that I should grant permission to Mr Palmer to appeal to the Chancery Division. My reasons are as follows: -

 

(1) The issue of which I am seised has never been substantively determined in this jurisdiction and cannot now be so determined. The original application made to HM Land Registry was referred to this jurisdiction in January 2004, and at the same time proceedings were commenced in the Chancery Division by Beaulane. This resulted in the proceedings here being adjourned pending the hearing of the Chancery Division action. The issue in this jurisdiction has been the subject of further adjournments following the procession of Pye v The United Kingdom in the European Court on Human Rights and the eventual application made by Mr Palmer in the Court of Appeal for an extension of time in which to appeal and for permission to appeal from the Order made by the Deputy Judge. Once this process concluded, then this jurisdiction was able to make a determination on the issue originally referred to it, but I consider that I am bound by the decision of the Deputy Judge.

 

(2) I appreciate that the Beaulane case has not, as such, been expressly overruled by the Court of Appeal, nor by Pye v The United Kingdom, but having regard to the judgments made in Pye v Graham, Pye v The United Kingdom and the Ofulue case (to which I have referred above) the so-called “heresy” in the Beaulane case for all intents and purposes is no longer good law.

 

(3) I also take into account the important consideration that the Deputy Judge in the Beaulane case made clear findings of fact in favour of Mr Palmer. He, however, found against Mr Palmer on human rights grounds, to which I have made reference above. I should also state that no cross-notice of appeal was ever mounted against the findings of fact made in the Beaulane case.

 

(4) Further, as I have noted above that Sir Peter Gibson in paragraph 10 of his judgment in the Beaulane case stated that were Mr Palmer be allowed an extension of time and permission to appeal there would have been a strong probability that the appeal would have succeeded.

 

36.              Thus, in my view, to do otherwise than to grant permission to appeal to Mr Palmer would be denial of justice to him in circumstances when clear findings of fact were made in his favour and the legal principles on the human rights issues as found by the Deputy Judge have now been considered to be flawed.

 

37.              I accordingly direct the Chief Land Registrar to cancel the original application but I further direct that the cancellation:-

 

(1)      should be stayed for an initial period of 28 days i.e. until 5 pm on 25^th July 2008;

(2)      should be the subject of a further stay pending outcome of the Applicant’s appeal, if any, but only if by 5 pm on 25^th July the Applicant serves on the Adjudicator and on the Land Registry a sealed copy copy of appeal against this decision.

 

38.              There is one caveat to which I should draw the parties’ attention in this Decision. Reference has made in the judgment of Sir Peter Gibson to a somewhat complicated transaction for the sale of the Disputed Land by Beaulane to a third party (see paragraphs 24ff). I have seen no documentation in relation to this – nor have I been addressed on this issue. I therefore must assume that this contract has never been completed and/or that completion may be conditional upon the conclusion of the various aspects of litigation relating to the land in question including this Decision. Other considerations would apply if the Disputed Land has in fact been sold to a third party.

 

 

 

 

Dated th e 26^th day of June 2008

 

 

 

By Order of The Adjudicator to HM Land Registry