“Squatter’s rights” is a colorful phrase for what the law calls adverse possession. Most people recognize the phrase, and are aware of the fact that the possession has to be for a certain length of time to take effect (20 years in Maryland).
It can happen to business property you own or even to residential property where you live. If someone has been using your business property to park cars, or as a way to get to his own property, and has been doing that for at least 20 years — even if you did not own your land for that long — that person could stop you from redeveloping your site if it restricts him from doing what he has been doing for 20 years.
Also, if someone is using your property in some way and you decide one day you want him to stop, you may not be able to make him do so.
Further, for an individual (or company) to have a right of adverse possession, that individual does not have to be the sole adverse possessor for all of the 20 years. If that person can combine the use of your property with the owners of his property before him for the 20 years (called tacking), he can receive the benefit of continuing what his predecessors started before him.
This applies to residential properties too. You may move into your house, and find that an adjacent property has been using a portion of your property for 20 years.
Say you are having an addition put on your house, and you have a survey done to know exactly where the boundary lines are so you can know where you can build. You may find that a portion of land that you did not know was part of your property is included within your boundary lines. This would be land that you paid for when you bought the property.
If that portion of your land has been used by the current adjacent property owner and his predecessors for 20 years, you could find out that you own less than what you paid for. Adverse possession has occurred in small subdivision lots, where, for example, an adjacent property owner planted a garden, put up a fence, mowed and maintained a lawn area or created a household pet burial ground in the disputed area.
Most title insurance policies do not cover claims of adverse possession because of various exclusions in the policies, so you are usually on your own in disputing such claims.
The moral of this story is when you are contemplating buying property, commercial or residential, make sure you thoroughly visually inspect every corner of the property so you can be alerted to any issues before you buy. If you come across any use of the property, you would want to fully investigate it before you close on the property, so you receive all of the property for which you are paying.
Of course, all matters of law have nuances and exceptions that cannot be covered in an article as brief as this, but this overview will help you and/or your business be aware of a potential issue about land you will be paying a lot of money for that could affect your right to use all of the property as you intended.
Thomas (Tom) Meachum, Esq., is a partner with Carney, Kelehan, Bresler, Bennett & Scherr LLP in Columbia. He can be contacted at 410-740-4600 or firstname.lastname@example.org.