Introduction

In order to assess whether the scope of ‘actual occupation’ is open to being flexible in its approach, one first must look at the aim of this interest and its purpose. Lord Denning in Strand Securities v Carswell [1965] stated that the purpose of an individual being able to claim an overriding interest in land is to ensure that disorganised property interests are not ‘lost in the welter of registration’. Furthermore, as per Midland Bank v Green [1981], to protect people who have made contributions to the property not matter how little. The term ‘actual occupation’ is found in Schedule 3, paragraph 2 of the Land Registration Act 2002, however it originates from its predecessor section 70(1)(g) of the Land Registration Act 1925. Neither of these have defined the term for a person or circumstance that may be encompassed by it in order to protect an overriding interest one may have in land. This means that one must look to case law to find a meaning that has been determined by the courts. It is worth mentioning that Schedule 3 paragraph 2 states that an individual must have a proprietary interest in land on top of which actual occupation is added. Strand Securities v Caswell [1965] stated that a licence would not be sufficient for a claim of an overriding interest.

Common Law

One of the cases that has been notable for starting the process of defining ‘actual occupation’ is that of Williams & Glyn’s Bank v Boland [1981]. This case was concerned with a husband and wife who bought a house together however the legal estate was in the husbands’ sole name holding on trust for himself and his wife. The husband then mortgaged the house to Williams & Glyn Bank and the question for the court was whether the wife’s equitable interest in the land was protected. Lord Wilberforce had to answer two questions that arose from the wording of s70(1)(g) of the LRA 1925. First, did the claimant have a right or interest in land. Second, was that the right/interest was protected only if the person was in ‘actual occupation’. Lord Wilberforce determined, using the Literal interpretation, that the wife was in ‘actual occupation’ as she had a physical presence within the property. This concept was taken further by the case of Abbey National v Cann [1991] where the courts stated that there must be ‘some degree of permanence and continuity’ rather than sporadic and inconsistent presence at the property. It could be argued that the additional requirement set by the court in Abbey National has both widened and narrowed the scope of ‘actual occupation’. On the one hand, the court has shown a willingness to extend the definition of actual occupation to those who have a continuous but not permanent presence on the land. This is illustrated within the case of Lloyds Bank plc v Rosset [1989] where the courts decided that regularly visiting the property whilst it was being renovated was classed as actual occupation. The definition of ‘actual occupation’ appears then, as seen in the above statement, to indeed be approached with a level of flexibility by the courts. However, this flexibility could be argued to be a step towards ‘one size fits all’ as it is allowing for more individuals to rely on this overriding right. The narrowing effect of Abbey National has similar connotations for the ‘one size fits all’ concept. Whilst the judgement extended to those who have ‘permanence and continuity’ for occupying a property, by its nature this excludes those who are inconsistent with their occupation. An example of such inconsistency and lack of permanence is found in Stockholm Finance v Garden Holdings [1995]. The courts held that due to the claimant not setting foot on the property for over a year their claim for an overriding interest failed.

Another example of how the concept of actual occupation has been allowed to evolve is regarding how the property is perceived to be used. In the case of Kling v Keston Properties Ltd (1985) the question for the court was whether keeping a car in a garage was determined to qualify as ‘actual occupation’. The judge in the case found that by storing a car in the garage, the land was being used for its natural purposes and therefore constituted ‘actual occupation’. Another case was Malory Enterprises Ltd v Cheshire Homes (UK) Ltd [2002] where a piece of derelict land had been fenced in by the claimant. Even though it has not been used in any other way than being fenced in, the claimant was deemed to be in ‘actual occupation’ as that was the natural use of such land. These cases highlight important aspects of how land can be occupied if it is being used in a particular way. It protects those who may not necessarily have their own physical presence, rather just that the land is being used in the purpose that it is recognised. However, this creates a dilemma for land that may not be being used in its natural way, but still nevertheless being used or indeed occupied. For example, if the garage in Kling v Keston were being used as an infrequent art studio by the owner, then this would not fall within the category of ‘natural use’. Though, as stated previously, this could be saved by the principle set by Abbey National by way of ‘a degree of permanence’. What is clear, is that whilst the courts have been reluctant to create a ‘one size fits all’ they have been able to create a flexibility for interpreting common law to encompass different elements of actual occupation.

The ‘degree of permanence’ as put forward in Abbey National has been interpreted so as not to penalise temporary absence from a property, as seen in Chhokar v Chhokar [1984] and Link Lending v Bustard [2010]. The courts were willing to accept that having property, such as furniture, on/in the land that this constituted as a ‘degree of permanence’. However, as stated earlier, the case of Stockholm Finance there does come a point as to the absence being too great for the overriding right of ‘actual occupation’ to fail. Stockholm Finance is the courts attempt at limiting the scope of actual occupation so as not to create a ‘one size fits all’ principle and has done so twofold. Firstly, by accounting for the length of time away from the property, and secondly by viewing the intention individual. This has been echoed in the cases of Link Lending v Bustard [2010], Thomas v Clydesdale Bank [2010], and Thompson v Foy [2009]. The courts have taken into account the intention of those seeking to claim actual occupation within the property. By considering intention, the courts can utilise an individualistic approach to each case which by nature restricts the ‘one size fits all’ risk. According to Chris Bevan in ‘Overriding and over-extended? A Call to Orthodoxy’ (2016), it is the intention of Parliament to narrow the scope of actual occupation by the courts taking a more objective approach.

Conclusion

The difficulty posed by a ‘one size fits all’ approach to actual occupation is that it has the potential for either encompassing too much while at the same time including too little. By creating a catch all approach it may rely too heavily on one element of ‘actual occupation’. For example, if ‘physical presence of the land’ were to be the benchmark for actual occupation, cases such as Thomas, Thompson, and Link Lending would have failed at this requirement. Furthermore, if an overriding interest was based in land being used for their natural purpose, as in Kling v Keston, then there would be countless failures of cases where land was indeed in use, but not captured within this element. As explored above, the courts have worked to create a dynamic set of case precedents that encompass enough so as to create a fair system for protecting overriding interests in land.