Hagman v. Meher Mount Corporation- an expansion of adverse possession?

Hagman v. Meher Mount Corporation.

This new case expands the ability to acquire property by adverse possession during a time when judicial review of the doctrine seeks to narrow it at almost every turn.

Larry Hagman sued to quiet title to a piece of land that was inadvertently enclosed with a fence and then improved.  The neighbor was a religious organization exempt from property tax.  The trial court granted summary judgment to Mr. Hagman.

The Court of Appeals rejected the argument from the religious organization that it is immune from adverse possession by reason of its status as a public benefit corporation.    The court soundly concluded that because a public benefit corporation is not a governmental agency, it is not entitled to any measure of immunity.

The surprise was that the court also concluded that because the religious organization was exempt from property tax, Mr. Hagman was excused from California’s requirement that he pay taxes on the property he sought to acquire.  California has a very short 5- year time period to acquire property by adverse possession, but balances the brevity with a requirement that the party seeking adverse possession must pay all property taxes levied against the property.  This is often very difficult to accomplish because the true owner will often pay property taxes which will prevent adverse possession even if the claimant pays as well.

This is a peculiar outcome, possibly explained by the celebrity of Mr. Hagman.  He benefited from the fact that his neighbor was exempt from property taxes.  While the religious organization was not a governmental entity, there should be some change to the law, either by statute or at a higher court, to make it equally difficult to seize property by adverse possession regardless of the status of the neighbor.

 

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