The Gazette 1987

GAZETTE

JANUARY/FEBRUARY 1 9 87

Mergers and Encroachments

It might be thought that as the

encroaching tenant's interest cor-

responds with the extent of his

own tenancy, a tenant holding under

a very long lease, a substantial

portion of which term is unexpired,

will not be too much troubled by

the doctrine's operation and the

possibility of his landlord claiming

possession of the encroachment.

Whilst this is true, there is one

situation where such a tenant may

unwitingly deprive himself of his

possessory title to the land en-

croached upon and this is where he

decides to buy out the freehold in

his own demised premises. Since

his interest in the encroachment is

co-terminous with the tenancy in

his own premises and subsists only

so long as it subsists, it follows

that where the latter estate disap-

pears upon the merger of it with

the freehold in the demised

premises being bought out by the

tenant, his entitlement to the en-

croachment thereupon ceases.

This is the

ratio

of the decision in

King

Smith.

The defendant, a weekly tenant

of a residential premises encroached

upon certain waste land adjoining

the premises and which belonged

to his landlord. Some time after the

defendant had been in occupation

for 12 years, the landlord's suc-

cessor in title sold the waste land

to the plaintiff and the freehold

reversion in the defendant's premises

to an investment company which

in turn sold it to the defendant. The

actual conveyance of the waste

land to the plaintiffs was executed

some two months after the con-

veyance by the defendant.

In proceedings brought by the

plaintiff for possession of the

waste land, the Court of Appeal

held the defendant's interest in the

waste land to have determined on

the merger of his weekly tenancy in

the premises with the fee simple. It

followed that the freehold in the

waste land had fallen into posses-

sion and the plaintiff as transferee

of it was entitled to recover

possession. Such a deleterious

consequence for the tenant may be

avoided, of course, should he buy

out the freehold in the waste land

also but this will depend on the

willingness of the landlord to sell

and

King

Smith

amply illus-

trates the ability of the landlord to

deal with the freehold in the waste

without regard to the tenant.

King

Smith

is also relevant to the last

aspect of the doctrine,

viz.

the

matters and circumstances which

the courts have indicated as rebut-

ting the presumption.

Rebuttal of the Presumption

One must be circumspect in

essaying an exhaustive statement

of such matters and circumstances

because much of the commentary

on this point involves an indis-

criminate adoption of

dicta

culled

from cases which might more pro-

perly be characterised as turning on

some other ground. In one of these

cases —

Whitmore

Humphries

— Willes J. indicated that where

the tenant had evinced an intention

to encroach for his own benefit the

presumption was rebutted. This

view must be contrasted with that

approved by Pennycuick V.C. in

Smirk

and by the Court of Appeal

King

Smith

to the effect that

that intention must be com-

municated to his landlord or (to put

it another way — there must be

evidence that the landlord and ten-

ant "so conducted themselves . . .

as to show that the landlord

treated the encroachment as not

enuring to his benefit".

This

would be so where, for instance,

the landlord, on being informed by

the tenant of his intention to con-

vey the freehold in the encroach-

ment to a third party takes no

objection to this course,

or,

possibly, where the landlord grants

to the tenant a new lease without

including the property previously

encroached upon.

Conclusions

Considering the large amount of

leasehold land in this jurisdiction,

the potential application of the doc-

trine which has been discussed to

instances of encroachments by

tenants must be considered as very

great indeed

and it is, therefore

all the more unfortunate that a

practitioner turning to the decided

cases for guidance in this area

should find them in disarray even

on so fundamental a point as to

whether the doctrine, when pro-

perly understood, holds that the

statute never runs in the encroach-

ing tenant's favour but that such a

tenant's rights derive instead from

some sort of estoppel.

An enquiring mind casting an eye

over this whole area will also, no

doubt, be disappointed by the com-

plete absence of discussion of the

doctrine in

Fairweather

St.

Mary/ebone Property

Co.

and

Perry

Wood farm Homes Ltd.

where arguably it merited some

discussion. Whilst in both those

cases the crucial issue to be deter-

mined was whether the squatter

had any right to possession at all

and not the duration of such a right

if he had any, both the House of

Lords and the Supreme Court

assumed that the right, if establish-

ed, would be for the duration of the

lease encroached upon; indeed, in

Perry

where the squatter's claim

succeeded, it appears from the

report of the decision that the order

of the Supreme Court declared the

squatter to be entitled to posses-

sion of the strip in question for the

remainder of the 999 year lease

under which it was held, yet the

squatter was himself holding the

adjacent premises under a lease of

only 250 years.

That observation prompts the

question whether the doctrine

should have any play in respect of

encroachments by tenants holding

under long residential leases; the

practical effect of modern legisla-

tion conferring rights of enfran-

chisement and entitlements of

reversionary leases upon such

tenants is to make them all but in

name the full owners of the land in

question.

Those that may be eventually

charged with the reform of the law

relating to adverse possession of

leasehold property because of the

developments referred to at the

beginning of this article may con-

sider the doctrine of encroachment

as part of their remit and propose

as a major reform, the qualification

on the doctrine's operation as

suggested in the preceding

paragraph; it is imperative though

that whatever forum, legislative or

judicial, next reviews this whole

area that it address the central

issue relating to the doctrine's

underlying basis and whether the

later cases have dislocated the

doctrine from its original premise

that the effect of the presumption

is that the Statute must be taken

to have never run in respect of the

tenant's encroachment over his

landlord's land.

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