34 the oxford introductions to u.s. law: property
• Adverse Possession
First possession, discovery, creation, and accession do not require anyone’s consent in order for acquisition to happen. This is why these doctrines operate as a source of original title. None of these modes of acquisition, however, cuts off some other person’s established right of ownership. Once ownership is established, we usually think that subsequent ownership of an object must be determined by transfer (sale, gift, will, or inheritance). Nevertheless, nonconsensual acquisitions can occur and, perhaps surprisingly, are sometimes allowed by the law. Adverse possession is a method by which someone, without the owner’s permission, acquires a new root of title to property already owned. The adverse possessor acquires title in this fashion by possessing the property until the statute of limitations for the relevant action by the title owner to recover possession has run—ordinarily ejectment in the case of land, and replevin in the case of chattels.
For an adverse possessor to prevail over an owner, the relevant possession must meet a number of requirements. Most importantly, the adverse possessor must enter and remain in possession (that key concept again!) for the requisite period of time established by the statute of limitations. Thus, if A enters O’s land and acts as an owner would for the right number of years (usually somewhere between ten and twenty), A may become the new owner. This goes beyond the normal result from the running of the statute of limitations. Suppose the statute of limitations is twenty years. Ordinarily, this would mean that O cannot sue for any wrong committed more than twenty years ago. O would still be allowed to sue for the wrongful possession by A within the last twenty years. Under the law of adverse possession, however, once the twenty years is past, O cannot sue A at all—the entire course of wrongful conduct is treated as having occurred at the moment of entry—and A, in effect, becomes the new owner. Moreover, A’s new title “relates back” to the point of original entry, so that A is entitled to keep any rents and
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profits earned in the last twenty years (but also must pay any taxes owed for the last twenty years).
To gain title the adverse possessor must meet a number of additional requirements beyond the running of the statute of limitations. These can be said to constitute a specialized definition of what “possession” means in this context. The occupancy must be exclusive, open and notorious, actual, continuous, and adverse under a claim of right. The central point uniting these requirements is that the adverse possessor must act as an ordinary owner would, in terms of restricting others’ access (or giving them permission), using the land, and so on, and must not have interrupted this activity. Many cases involve seasonal homes, and the issue is whether the adverse possessor’s use is as continuous as a ordinary owner’s would be. The requirement of continuity does not require the same adverse possessor to engage in adverse possession for the statutory period, but allows various adverse possessors to “tack” their periods of adverse possession, as long as the transfer from one adverse possessor to the next is consensual. But if one adverse possessor ousts another, the clock starts over.
Crucially, the adverse possessor’s use must be without permission (“adverse”). If O has given permission for A to enter the land, there is no adverse possession until the permission is exceeded (or withdrawn). Courts differ as to whether the adverse possessor must be in bad faith (knowing of the rights violation), good faith (not knowing) or whether the adverse possessor’s state of mind matters at all. Interestingly, regardless of the law on the books, courts tend to look unkindly on bad faith adverse possessors.21 Squatters and thieves have trouble convincing courts to award them title by adverse possession, even if a long period of time has elapsed since the original dispossession.
21.R. H. Helmholz, Adverse Possession and Subjective Intent, 61 Wash. U. L.Q. 331 (1983).
36 the oxford introductions to u.s. law: property
The statute of limitations can be suspended if the owner is laboring under one of a small class of disabilities, such as being under age or insane. Disabilities, however, cannot be “tacked”: if the true owner at the time of the adverse possessor’s entry is a child, who later becomes insane, the statute is only suspended until the true owner becomes 18 years old. It is a little hard to see why one insane person should be expected to sue when another is not. Perhaps the rule is meant more to prevent adverse possessors from choosing to enter the land of owners under disabilities; once entry has occurred, a different or later disability is less likely to enter into the adverse possessor’s decision to stay. Thus, the disabilities rules can be seen as another reflection of distaste for bad faith adverse possessors.
Personal property can be acquired by adverse possession as well. Here the relevant statute of limitations is the action for replevin (or conversion in states that allow recovery of possession through this action). Adverse possession is particularly important for valuable and long-lasting chattels such as art work and jewelry. Unlike in the case of land where the owner can easily find out whether an adverse possessor is possessing the land, personal property is harder to keep track of. (This is one reason we do not have well developed title records for personal property.) So when should the statute of limitations start ticking in the case of personal property? For thieves and converters, the statute is held to start running from the moment of the theft or conversion. From that moment, the true owner has a cause of action against the wrongdoer. Things are a little more complicated in the case of a good faith purchaser, such as a person who buys artwork from a dealer without realizing it was originally stolen. Some jurisdictions, such as New York, have adopted a demand rule: The clock does not start ticking until the true owner demands the return of the chattel and is refused.22 Other jurisdictions, including New Jersey, hold that the clock starts ticking when the owner either knows or reasonably should have known through the exercise of
22. Solomon R. Guggenheim Found. v. Lubell, 569 N.E.2d 426 (N.Y. 1991).
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reasonable diligence the identity of the person who has the object.23
These are highly fact-intensive inquiries, and whether they make sense depends on which rationale for adverse possession (if any) one subscribes too. Longer, more difficult applications of the statute of limitations protect true owners at the expense of adverse possessors. One oddity is that the clock typically starts ticking earlier when the chattel is in the hands of a thief than when it has come into the possession of a good faith purchaser. It is hard to see why thieves are more deserving of protection, and as we will see, as between owners and good faith purchasers, U.S. law generally tends to be more protective of owners (and less protective of good faith purchasers) than other, especially civil-law, systems.
Why have adverse possession at all, especially considering its close relationship, in bad faith cases, with theft? Justifications for adverse possession fall into three broad classes. Consistent with adverse possession’s origins in the statute of limitations, one rationale emphasizes the slothfulness of the true owner. One can argue the owner is a less worthy gatekeeper than the adverse possessor, or losing the property will hurt the owner less, as evidenced by the owner’s indifference in not suing within the limitations period. A second class of theories focuses on the adverse possessor and sees adverse possession as rewarding a diligent possessor who has built up a connection to the property that would be painful to break. (Sometimes this is reinforced with references to the endowment effect in psychology, which seeks to explain the apparent gap in some settings between the higher price people require to give up something they already have than the price they would pay to acquire it.) A third class of rationales are those that emphasize sys- tem-wide effects: land records and other questions of title are simpler when old history becomes less relevant. This too is reminiscent of the general reasons for having statutes of limitations, related to the difficulty of proving—and defending against—“stale” claims.
23. O’Keeffe v. Snyder, 416 A.2d 862, 868–70 (N.J. 1980).