Others Claiming or Using Your Land: Encroachments & Adverse Possession Claims

With the increasing cost and reducing size of city residential properties, exactly what land is owned by you is becoming a far greater issue.

 

If you are either an owner of land upon which an encroachment extends (adjacent owner) or are an owner of a property that encroaches upon another person’s land (encroachment owner), you may apply to the Court for relief.  Typical examples of an encroachment may include:

 

  • a boundary wall that is incorrectly placed over a neighbour’s boundary; or
  • a garage roof that overhangs across a neighbouring property.

Pursuant to section 2 of the Encroachment of Buildings Act 1922 (NSW) (Encroachment Act) an encroachment is defined as ‘encroachment by a building, and includes encroachment by overhang of any part as well as encroachment by intrusion of any part in or upon the soil.’

 

Pursuant to section 3(2) of the Encroachment Act, the Court may order:

 

  1. the payment of compensation to the adjacent owner;
  2. the conveyance transfer or lease of the subject land to the encroaching owner, or the grant to the encroaching owner of any estate or interest therein or any easement right or privilege in relation thereto; or
  3. the removal of the encroachment.

However, in doing so, the Court must take into consideration the items specified in section 3(3), which are:

 

  1. the fact that the application is made by the adjacent owner or by the encroaching owner;
  2. the situation and value of the subject land, and the nature and extent of the encroachment;
  3. the character of the encroaching building, and the purposes for which it may be used;
  4. the loss and damage which has been or will be incurred by the adjacent owner;
  5. the loss and damage which would be incurred by the encroaching owner if the encroaching owner were required to remove the encroachment; and
  6. the circumstances in which the encroachment was made.

Are there any defences for an encroaching owner?

 

It is the general position that if an encroachment exists, the encroaching owner is responsible for that encroachment, which is similar to a strict liability offence.  However, dependent on the facts an encroaching owner may argue the defence of estoppel.  Proprietary estoppel may be raised in the case that it is unfair to allow a landowner to assert their full legal rights, either because they have encouraged another person to build on the land or because they acquiesced in mistake. 

 

The case of Byron Shire Council v Vaughan & Anor [2002] NSWCA 158 involved an application by Council to remove an encroaching house.  The encroaching owners argued that Council was estopped by reason of its conduct and representations from asserting title over the lot in which the encroachment lies.  The Court of Appeal upheld the decision of finding that it would be unjust or unconscionable for Council to retain ownership over the lot on which the portion of the house encroached and so Council was estopped and was held to the representation that it cannot assert conflicting ownership of land within the fences.

 

Adverse Possession

 

In NSW, adverse possession may be claimed by an encroaching owner if they have occupied the encroached land for 12 years or more and have satisfied the requirements under the RP Act.  However, this is a very technical area of law and care must be taken to understand your rights.  The general position of section 45D of the RP Act is that adverse possession is only possible if the adverse possessor has occupied the whole of the land parcel.  This principal also applies in respect of part areas of common property.  However, the Act allows adverse possession claims in regard to partial lots in limited circumstances, which are:

 

  1. an occupational boundary replaces or represents the boundary of the whole parcel, and the part possessed by the applicant does not lie between the occupational boundary and the legal boundary (section 45D(2) of the RP Act); or
  2. a partial lot represents a “residue lot” (sections 45D(2A) and 45D(2B) of the RP Act).

A ‘residue lot’ is defined in section 45D(2B) to mean an allotment consisting of a strip of land that:

  1. was intended for use as a service lane; or
  2. was created to prevent access to a road; or
  3. was created in a manner, or for a purpose, prescribed by the regulations.

This ‘strip of land’ comes from many older subdivisions, in which the subdivider made provision for access to the rear of properties.  These access ways or service lanes were occupied by some adjoining property owners.

 

There is scarce case law surrounding this area of law.  However, it should be noted that:

 

  1. Fencing or enclosure is not conclusive evidence of adverse possession, though it is an important indication of an assertion of the right to possession over it: Re Riley and The Real Property Act (1964) 82 WN (Pt 1) (NSW) 373, [381]. 
  2. Although the payment of rates is not decisive, evidence of payment of rates for the disputed land may be used to support or defeat a claim.  If the adverse possessor pays the rates it is evidence that they had the intention of possessing the land to the exclusion of others.  However, payment of rates is far from determinative and is often of slight significance and therefore does not disprove the fact of possession: Robinson v Attorney-General (1955) NZLR 1230, [1235]; Shaw v Garbutt [1996] NSWSC 400.
  3. The making of a survey, pegging of boundaries, or renewal of survey marks by the owner of the documentary title is an assertion of the owners entitlement to possession: Ocean Estates Ltd v Pinder (1969) 2 AC 19.

It is important not to delay seeking expert advice regarding an encroachment issue as you may find yourself in a situation where your neighbour can legally take ownership of part of your land.  At Bannermans Lawyers we have a lot of experience in dealing with these sort of matters and can provide advice to you quickly.

 

***The information contained in this article is general information only and not legal advice. The currency, accuracy and completeness of this article (and its contents) should be checked by obtaining independent legal advice before you take any action or otherwise rely upon its contents in any way.

 

 

Prepared by Bannermans Lawyers

22 October 2019

 

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For more information on this topic or any legal enquiries please contact your Strata Team.

 

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