Company sues property developer in legal bid to protect possession of land

Lord Pentland
Lord Pentland

A company which claims to have possessed a number of industrial units in a business park for more than 20 years has been granted a full hearing in an action against a property developer who was allegedly seeking to take over possession of the land.

The pursuers GNC (Scotland) Ltd were seeking declarator that they had possessed the land “openly, peaceably and without judicial interruption” for over a year, but the defender Steven Gillespie argued that the action should be dismissed because the pursuer did not have a valid title to the property.

A judge in the Court of Session granted a proof before answer after ruling that while the pursuers did not have a heritable title to the property, their averments of “exclusive possession” entitled them to raise proceedings to prevent the defender from dispossessing them and denying them the right to make an application to register the title.

‘No legally entitled owner’

Lord Pentland heard that the pursuers, a transportation and pallet delivery company, were seeking declarator that they have possessed a number of large storage sheds at Garrion Business Park in Wishaw “openly, peaceably and without judicial interruption for a continuous period in excess of one year”.

Neither the pursuers nor the defender have a registered title to the property, but the pursuers claimed that since around 1998 they had used the land for their fleet of over 40 articulated lorries and vans 24 hours a day, seven days a week, and that no other person had occupied, used or entered the property during that period.

In addition to declarator, the pursuers were also seeking separate declarators that they were entitled to retain possession of the property and that they had a patrimonial interest arising from their ability to grant and/or register an a non domino disposition of the property and thereby acquire a “proprietary right” over the land.

The pursuers also sought various orders for interdict against the defender from interfering with their rights in the property by erecting obstructions along the boundary, from preventing the pursuers gaining access to the property, and from entering or taking up occupancy in the property, having previously been granted interim interdict against the defender.

In their pleadings the pursuers averred that the last registered owner of the property was a company called Whitechurch Developments Limited, which was incorporated in 2006 as a property holding company but was dissolved in 2010.

The property would, therefore, ordinarily have fallen to the Queen’s and Lord Treasurer’s Remembrancer (QLTR) as bona vacantia, but the QLTR disclaimed the property in 2012.

The pursuers aver that they have taken “all necessary and legal steps” properly to acquire the property, but neither the previous owners of the property nor the QLTR had any interest in it, meaning there was “no legally entitled owner of the property”.

‘Prescriptive claimants’

In these circumstances, the pursuers applied to the Keeper of the Land Registry to acquire the property as “prescriptive claimants” under the procedure set out in section 43 of the Land Registration (Scotland) Act 2012.

However, in early November 2018 the defender contacted the pursuers to discuss acquiring the property for the purpose of housing development.

According to the pursuers’ averments, the defender indicated that he was going to acquire the property because he had ascertained that there was no true owner of the land, and was planning to erect fences, block off part of the property, take possession of it and exclude the pursuers from it.

The pursuers argued that the defender had “no right, title or interest” to take any of these steps and that his actions were “purely speculative”, adding that the defender’s statements to the pursuers disclosed an intention to seize the property from them “without judicial authority”.

In view of the defender’s intentions, the pursuers brought the present proceedings, claiming that they had been using and occupying the property for over 20 years and had spent “substantial sums” on it.

It was submitted that they had used and treated the whole of the property as their own and had the “patrimonial right” to secure title to it or to occupy it with a view to potential acquisition in terms of the 2012 Act.

The court was told that the Keeper had rejected the application by the pursuers under section 43 of the 2012 Act in July 2019 on the basis that possession of the property was in dispute; the Keeper’s position was that she would not accept an application until the present action had come to an end and she could be satisfied that the test in section 43(3) could be met.

The pursuers’ position was that they did not require to found on any formal heritable title to the property because in the circumstances of the present case, bare possession of the property afforded sufficient title to sue and the pursuers had a patrimonial interest sufficient to afford them title to sue, meaning the defender’s averments on the need for a heritable title were “irrelevant”.

The pursuers argued that they were entitled to seek declarator to protect their possession of the property so that they could make an application to the Keeper under section 43 of the 2012 Act on the basis of their having occupied the property openly, peaceably and without judicial interruption for more than a year.

‘Title to sue’

The judge ruled that the pursuers’ averred prospective entitlement of having their application under section 43 of the 2012 Act considered and accepted by the Keeper was “sufficient to confer on them title and interest to pursue the present action against the defender”.

In a written opinion, Lord Pentland said: “In my opinion, the pursuers’ averments on title and interest to sue are relevant and must be allowed to proceed to an inquiry.

“It is true, of course, that they do not have a heritable title to the property, but the law has not always insisted on this as a requirement for entitlement to protect possession by court action against a person who himself has no title to the land which is the subject of the dispute.

“Moreover, under the modern law it is the essence of an application to the Keeper under section 43 of the 2012 Act that the applicant does not have a title to the land he claims to be in possession of.

“It seems to me that a person who claims to be qualified to make such an application should be entitled to raise a court action to prevent a third party, who is not in possession of the land in question, from dispossessing him and so denying him the right to make the application. In my opinion, an action for declarator and interdict is competent in such circumstances.

“Having regard to the pursuers’ averments of exclusive possession of the property over a lengthy period and the lack of any title on the part of the defender, I consider that the pursuers are entitled to bring the present proceedings.

“In my opinion, the pursuers were well-founded in submitting that even before one considers the impact of the 2012 Act, the law would have recognised the legal relation which the pursuers offer to prove as sufficient to establish title to sue the defender, notwithstanding that the pursuers do not have a formal legal title to the property.”

© Scottish Legal News Ltd 2021

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