It’s no secret that I’m passionate about the law, but every now and then a matter hits the media that really piques my interest. Enter: the recent NSW Supreme Court decision of Australian Retirement Holdings Pty Ltd v Tracey Anne Higgins in her capacity as administrator of the estate of the late Monica Mary Pritchard [2021] NSWSC 1158, which dealt with the legal claim of adverse possession (commonly referred to as squatters’ rights).
Defining adverse possession
Adverse possession occurs when a person or entity acquires the title to a property from the original owner, without paying for it, because they can prove uninterrupted possession of the property, to the exclusion of the owner and third parties.
The legal principle operates to deal with overlooked land where the original owner has been dead or absent for a long period, and imposes an obligation for an owner to use, maintain and defend land. If the land is neglected for a long period, the law considers that the original owner has forfeited their right to keep it.
Laws around adverse possession and the necessary period of uninterrupted possession vary depending on which State or Territory the property is in. In NSW, the relevant period is 12 years.
What was the background to Australian Retirement Holdings Pty Ltd v Tracey Anne Higgins?
When Tracey Higgins’ grandmother, Monica Mary Pritchard, passed away in 1993 she left behind a four-acre block in Campbelltown. As the years passed, the land remained unoccupied.
In 2006 construction began on Mount Gilead Estate, a retirement village, on the neighbouring block. The finished village is set to include 840 serviced self-care dwellings, a community facility building and 270 hostel units across two buildings.
The Mount Gilead Estate had several owners before being purchased by Australian Retirement Holdings (‘ARH’) for continuation of the development. At some point, one of the owners began using a road on the late Mrs Pritchard’s property for access to the development.
In 2019, Ms Higgins became an administrator of her late grandmother’s estate and discovered that the land was being used by ARH. She sent a letter requesting ARH cease and desist using the land and when that received no response, Ms Higgins voiced her objections via a sign on the property stating “Private. Keep Out.” and the details of her lawyer. ARH responded by commencing legal action in the Supreme Court claiming adverse possession.
ARH’s argument for adverse possession
In NSW, in order to successfully argue adverse possession, the onus is on the squatter to prove that they have maintained exclusive possession of the property for a period of 12 consecutive years.
ARH claimed that they were entitled to ownership of the acreage based on their use and occupation of the property over a period of years, as well as that of its predecessors.
ARH claimed that since 2013, it had occasionally cleared vegetation and weeds from the late Mrs Pritchard’s property. Dirt roads had been built and skip bins were also located on the property for the household waste of residents in Mount Gilead Estate. A gate was at the entrance of the road used for access to the property and according to ARH, it kept it locked unless construction was taking place. They had also reached an agreement with the local Council to maintain the road for construction access.
In 2019, ARH hired a security company to patrol the road and property. A sign was also hung from the gate notifying the public of a security presence.
The verdict
ARH’s prospects of success in the Supreme Court proceedings rested on two points – exclusive possession and 12 years of using the property as if it were its own.
Judge Robb said that evidence tendered by ARH regarding use of the land was consistent with its current appearance. However, several members of the local community disputed ARH having exclusive possession. They provided testimony regarding the property being frequented by locals for recreational purposes – dog walking, riding motorbikes, mountain biking, etc. Many of these residents did not remember a gate being in place, or if it was, it remained open over the period in question. The property itself also had evidence of established trails and, aside from the gate, the boundary fences were in poor repair and in some cases, non-existent.
In examining the evidence, Judge Robb also determined that ARH had failed to demonstrate that it and its predecessors had exercised adverse possession for the required 12-year period due to the sporadic nature of the development’s construction and proof of a different road being used for access in earlier years.
Judge Robb dismissed ARH’s statement of claim and ordered it to pay Ms Higgins’ legal costs. His Honour did stipulate, however, that no orders requiring ARH to give up possession should be made until it is able to apply to the Court for an order granting easements over the property that will enable it to complete construction, and for any other potential other purposes related to the safety of the Estate’s residents.
The key takeaways
Disputes involving adverse possession, or squatter’s rights, are increasingly infrequent – flying under the radar on someone else’s property for 12 years can be challenging, especially given the value of property in today’s market! That’s not to say that it doesn’t happen – in 2018 a developer had the title of a Sydney property transferred into his name after he found it vacant, renovated it and rented it out for 20 years (unbelievable, but true story! Read about it here).
At first glance, when looking at this case, most people react with the question, “who could forget that they owned four acres in Greater Sydney?!”
Monica Pritchard and Arthur Russell Pritchard (both deceased) are registered as joint tenants of the acreage. On her passing, Ms Pritchard’s son became the executor of the estate. When he too passed, it was discovered that he had failed to transfer the title into his name for the purpose of distributing it in accordance with his mother’s wishes.
Ms Higgins, upon becoming administrator of her late grandmother’s property immediately sought to rectify the issue, including reaching an agreement with Council to pay the years of outstanding rates.
Had Ms Higgins not become an administrator of the estate when she did, ARH may have been able to prove 12 years of possession with greater success, particularly given the increase in its usage of the road in recent years.
If you’re on either end of an adverse possession claim, I’d love to hear from you! Please contact me on 0402 136 083.
