The Gazette 1987

JANUARY/FEBRUARY 1 9 87

GAZETTE

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 v Smith. 23 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 v Smith 24 amply illus- trates the ability of the landlord to deal with the freehold in the waste

without regard to the tenant. King v 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 v Humphries 25 — 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 in King v 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". 26 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, 27 or, possibly, where the landlord grants to the tenant a new lease without including the property previously encroached upon. 28 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 29 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 v St. Mary/ebone Property Co. 30 and Perry v Wood farm Homes Ltd. 31 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. 32 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. 33 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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