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Irvin Schein blogged "Adverse Possession and the Effect of Mutual Mistake"

Aug 13, 2012

Written by: Irvin Schein

The recent Superior Court decision of Chen v. Stafford, released on July 4, 2012, contains an interesting review of the law of adverse possession and particularly the impact of mutual mistake in adverse possession cases. 

What is the result if both the claimant and the true owner are genuinely under the impression that the disputed land actually belongs to the claimant, i.e. the true owner does not realize the disputed land is included within his title.

I have conducted a number of trials involving adverse possession claims.  I have thoroughly enjoyed them.  They usually require all kinds of investigative work as part of the preparation for trial, including the obtaining of testimony from elderly people who seem to remember where a fence was put up or taken down decades earlier, or the approximate time that a particular oak tree was planted. 

I have always been struck by the extent to which neighbouring land owners, usually on a country lake with 200 feet of property along the shore, will spend weeks in court and tens of thousands of dollars litigating over a 2 foot strip running along their mutual boundary. 

In any event, Chen v. Stafford was a case involving a disputed area between neighbouring parcels of land fronting on the St. Lawrence River in the Kingston, Ontario area.  The Applicants brought the proceeding for an Order declaring that they had acquired title to the disputed area by virtue of their exclusive use and possession of the area for over 50 years. 

The law in Ontario relating to adverse possession is well established. The legal test was established long ago and has since been confirmed by the Court of Appeal on a number of occasions. Basically, a party claiming a possessory title must establish three requirements:

(a) actual possession for at least 10 years;

(b) that such possession was with the intention of excluding the registered owner from possession; and

(c) discontinuance of possession by the owner for at least 10 years.

For the first requirement, the law is clear that the actual possession must be clear and obvious and not secret. The claimant must be using the property just as the true owner might use it and his possession must be such as to put the true owner on notice that the 10-year period has begun to run. Furthermore, that claimant must be in possession without the permission of the owner (hence the “adversity”). If the claimant acknowledges the rights of the true owner, the possession cannot be considered adverse.

The third requirement is straightforward as well. The claimant’s possession must be such as to exclude the true owner from the possession and use of the disputed property. Typically, this is done by a fence which has the effect of preventing the true owner from using the property. If the true owner does have the ability to use the property, and does use it, the 10-year period will not run.

The second requirement, possession with the intention of excluding the true owner from possession, is the most interesting one. It raises the question of the true owner’s intended use of the property. The law is clear that a claimant cannot obtain possessory title by depriving an owner of uses of the property that the true owner never intended to make of it. The claimant must have the intention to exclude the true owner from such uses as the true owner wanted to make of the property. If the use of a true owner wanted to make of his property is limited and intermittent, a claimant is going to have a very difficult time achieving success.

Even more interesting is the question of mutual mistake. In other words, what is the result if both the claimant and the true owner are genuinely under the impression that the disputed land actually belongs to the claimant, i.e. the true owner does not realize the disputed land is included within his title?

The difficulty arises because if a property owner genuinely believes that the claimant owns the land, and the second requirement applies, every claim for adverse possession will necessarily fail because such an owner cannot have had an intended use for the property since he believed it belonged to somebody else. In other words, if a claimant has to show inconsistent use when both sides are honestly mistaken about the true boundary line between their properties, the claimant could never make out a case of adverse possession. On the other hand, a claimant knowingly displacing a true owner might well succeed in such a claim. This would have the rather bizarre result of rewarding a trespasser who knows full well that he is trespassing while penalizing someone who is behaving in accordance with what he believes to be his legal rights.

As a result, and as this case reaffirms, it is now the law in Ontario that in a case of mutual mistake, this second requirement simply does not apply. As a result, a true owner opposing a claim for adverse possession cannot succeed simply by insisting that he always assumed that the disputed land belonged to the claimant anyway and that he did not make any use of the property, or intend any use of the property, for that reason. In a case of mutual mistake, if the claimant has 10 years of actual possession and the true owner does not use the property at all, title will usually vest in the name of the claimant without anything further.

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