Finders, Keepers, Losers, Weepers

It made headlines in November last year – a Sydney developer that exercised “squatters rights” to claim title to a house valued at $1.7M by simply moving in to an unoccupied Ashbury house and renting it out.

The house at 6 Malleny Street was originally purchased by Mr Henry Thompson Downie in 1927. He resided in the house with his family until they moved to neighbouring suburb a decade or so later.

Mr Downie died in 1947 without leaving a will.

The house was rented to a Mrs Grimes who was a “protected tenant” paying a small amount of rent until her death in 1998.

That same year, Mr Bill Gertos, former accountant, came across the house while visiting clients in the same street. He was told by neighbours that the house was occupied by an elderly lady who had recently died. He decided to take possession of the house for himself after finding the house uninhabitable.

He changed the locks and engaged a builder to make some improvements to the home so that it was fit for occupation. He paid the rates and other statutory charges on the property and engaged a managing agent to lease the property.

In 2017, Mr Gertos made a possessory title application to the Registrar-General to be recorded as the registered proprietor of the land pursuant to section 45D(1) of the Real Property Act 1900 (NSW). This part provides that a person who is in possession of land (that is, the whole parcel of land) and the title of the registered proprietor has been extinguished by application of the statute of limitations as against the person in possession, may apply to be recorded as the proprietor of that interest in land. The applicant must be in adverse possession which is possession that is “open, not secret; peaceful, not by force, and adverse, not by consent of the true owner”1. The Court accepted Mr Gertos was in adverse possession based on the circumstances. Justice Darke commented on the purpose of law that there is a public interest in ensuring that a person in long-term and undisputed possession is able to deal with the land as owner.

Statute of Limitations

In 2017, Mr Downie’s daughter and two grandchildren commenced proceedings for a declaration that Mr Gertos was not entitled to be registered as the proprietor. By the time the family of the deceased owner’s family took an interest in the property to recover the land, it was too late.

The cause of action to recover the land by the true owner accrued when the owner was entitled to possession. This means that the owner was entitled to recover the land once the property was no longer tenanted, that is, when Mrs Grimes died in 1998, the same year Mr Gertos took possession. There is a 12 years limitation period to recover the land. That period expired in 2010.

This case highlights that in NSW, “squatters rights” or possessory title (by adverse possession) are well and truly alive.

You’ll find that the team at Conditsis Lawyers is here to demystify your property matters.

1 Bowen CJ in Eq in Mulcahy v Curramore Pty Ltd [1974] 2 NSWLR 464 at 475

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