tisdag 7 november 2006

A terrible decision by the EU Court of Human Rights

The European Court of Human Rights has ruled in favour of a property company, J A Pye, based in Oxford, when it appealed against a decision by the House of Lords to allow the occupant, a farmer, “squatters’ rights” - the ancient right in English law to claim ownership of land if it has been occupied without challenge for 12 years.

For many years, the farmer had been using the land, near Newbury, Berks, for grazing. Originally, it had been leased from the company under a grazing agreement, but in 1984 the company refused to renew the lease as it intended to develop the site. The farmer continued to use it and in 1997, registered a claim with the Land Registry, claiming to have aquired title by unchallenged occupation.

Legal action followed, culminating in the Law Lords’ decision. The company then appealed to the European Court of Human Rights in Strasbourg, which ruled that the UK breached the human rights of the developers by not changing an ancient law sooner, to protect landowners. The government is appealing to the Grand Chamber of the European court of human rights and a decision is awaited later this week, but according to a report in the Guardian, if this fails, taxpayers could face a bill of millions of pounds for compensation to the property company.

This decision is disturbing for many reasons. In the first place, the company had acted incompetently in not protecting its title; had it continued to allow the farmer to use the land on licence, the situation would not have arisen. It is not good enough to blame English land law, since a property company should be perfectly well aware of the rules.

The second point is that English land law does not recognise absolute ownership of land; land ownership is a holding from the Sovereign, who holds it on behalf of the people as a whole. This is an excellent principle, since land was made by no man but is a Gift of Nature – or God, if you believe in such an entity. It is worrying that a European Court should be able to override this. The implications go beyond England; in Sweden, there is an ancient Right of Public Access to land which could equally come under threat if some landowner tries to make out that it is interfering with his human rights.

Related to this is a further question about an owner’s right to enjoy land. The property company in question was not enjoying the land. It wasn’t even collecting a peppercorn rent. All it was doing was holding it out of use while speculating on the likelihood of a future increase in value. To all intents and purposes, it had abandoned their land. Such speculation prevents anyone else from using it, and if we accept that land is held by the Sovereign on behalf of the people, then it is not unreasonable to expect some limit to the protection the state will give to a land holder who is just sitting on a piece of real estate whilst waiting for it to go up in value.

Furthermore, in this instance, the owner was not a human being but a corporate body, set up under legislation which gives such bodies certain privileges, and one wonders why the notion of human rights should apply at all. It sets a bad precedent.

There is a final twist to this story. Nobody would be much interested in the property if the site was merely grazing land. But with planning consent for residential development, the site is worth over £20 million. Whether the beneficiary is the property company which paid a fraction of this amount or the farmer who picked it up under squatters’ rights, there is a huge windfall waiting to be gained on the strength of a decision by a planning committee, and this cannot be right either.

To its credit, the government is aware of this latter issue and is proposing to charge for planning consents, either through something called a Planning Gain Supplement or a “Roof Tax”. Unfortunately, this is just a revival of legislation which has been tried and found wanting four times since 1945. The solution which would actually work – Land Value Taxation, remains off the agenda.

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