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Privy Council approves the treatment of limitation deeming provisions in “Adverse Possession”

A Board of the Judicial Committee of the Privy Council today handed down judgment in Garcia v Arima Door Centre Holding Company Ltd [2023] UKPC 31. The judgment of the Board was delivered by Lord Leggatt.

The Board reversed the decisions of the lower courts and, in doing so, approved the statement of the relevant law in Adverse Possession by Stephen Jourdan KC & Oliver Radley-Gardner KC.

The case concerned a claim to possession of land in Trinidad and Tobago, where the only relevant defence was that the claim was barred by adverse possession pursuant to the Real Property Limitation Act 1846.

That statue is modelled on the Real Property Limitation Act 1833, the provisions of which, as amended, are now contained in the Limitation Act 1980, except that the Trinidad and Tobago statute fixed a limitation period of 16 years.

The Trinidad and Tobago statute includes at section 9 the following provision:

“When any person shall be in possession or in receipt of the profits of any land, or in receipt of any rent, as tenant from year to year or other period, without any lease in writing, the right of the person entitled subject thereto, or of the person through whom he claims, to make an entry or distress, or to bring an action to recover such land or rent, shall be deemed to have first accrued at the determination of the first of such years or other periods, or at the last time when any rent payable in respect of such tenancy shall have been received (which shall last happen).”

The equivalent provision in England and Wales is set out in the Limitation Act 1980 is in Schedule 1 paragraph 5 and says:

“(1)   Subject to sub-paragraph (2) below, a tenancy from year to year or other period, without a lease in writing, shall for the purposes of this Act be treated as being determined at the expiration of the first year or other period; and accordingly the right of action of the person entitled to the land subject to the tenancy shall be treated as having accrued at the date on which in accordance with this sub-paragraph the tenancy is determined.

(2)     Where any rent has subsequently been received in respect of the tenancy, the right of action shall be treated as having accrued on the date of the last receipt of rent”.

The issue in the Garcia case was whether section 9 of the Trinidad and Tobago statute applied when an oral monthly tenancy was determined by a notice to quit and rent was subsequently paid covering the period up to the end of the tenancy.

The property had been held under a tenancy which was determined by notice to quit on 30 April 1996. Subsequently, on 23 August 1996 the tenant paid the rent due up to the termination of the tenancy, but did not vacate the property.

The claim to possession was issued on 12 May 2012, which was more than 16 years after the termination of the tenancy, but less than 16 years after the last payment of rent.

The trial judge and the Court of Appeal held that section 9 applied. Therefore the right to recover the land only accrued on 23 August 1996, the date on which the last payment of rent was made. Accordingly, the possession claim was brought within the limitation period.

The Privy Council disagreed. The Trinidad and Tobago statute, like the equivalent legislation in England and Wales, contains a number of deeming provisions, which include section 9. These deeming provisions are not exclusive and, in any case not covered by them, recourse must be had to general principles to determine when a right to recover land first accrues. The purpose of the deeming provisions is not to limit the generality of the limitation period, but to explain the section imposing the limitation period and to settle cases where there might be a doubt about when time started to run.

At common law non-payment of rent by a tenant does not automatically bring the tenancy to an end. The purpose of the section 9 deeming provision was to provide a clear rule in circumstances where rent has not been paid under an oral periodic tenancy but no formal step had been taken to terminate the tenancy. In such a case, provided that some rent has been paid after the first period, time will run from the last time when any payment of rent was received. This prevents the landlord from arguing that the tenancy subsisted even though no rent was paid, so that time did not begin to run until what might be a much later date.

Section 9, however, had no application in a case such as the present where the tenancy was terminated by service of a valid notice to quit. In a case of this kind there is  no doubt about when the landlord’s right of entry arose: namely, when the notice to quit expired. Hence there is no need to have recourse to a deeming provision. Section 9 does not apply, as after the notice to quit has expired the person in possession of the land is not in possession “as tenant”, nor is the right of the person entitled to bring an action to recover possession “subject to” a tenancy”.

Lord Leggatt said:

“14.   In short, the law applicable both in England and Wales and in Trinidad and Tobago is, in the Board’s view, correctly stated in the following passage of Jourdan and Radley-Gardner on Adverse Possession, 2nd ed, para 5-07:

“One common situation which is not covered by any of the deeming provisions is that of the tenant who holds over wrongfully after the termination of his tenancy. … In such a case, as none of the deeming provisions apply, the general law applies, and time starts to run against the landlord from the termination of the tenancy, which is when the landlord first acquires the right to recover the land from the tenant.”

15. Thus, on the facts of this case time began to run from the termination of the tenancy on 30 April 1996. It follows that, before the action was begun on 18 May 2012, the right to recover the property from the appellant had been lost.”

The decision can be downloaded here.

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