Title & Possession

Title / Ownership of Goods

Title refers to ownership. The owner is said to have title.A property right gives the right to assert possession, control and ownership of something, which holds valid as against all persons. It is presumed that the owner is the person in possession.  The person may have possession without physical possession.

Title to goods may be acquired by the first owner by being made or assembled. A subsequent owner may acquire title by purchase, gift or other lawful acquisition from the preceding owner. A finder of goods which have been abandoned will generally acquire title.

If the goods are purchased or acquired from a person without title, the title is not usually taken. The “true owner” or person with a better title, may usually assert his ownership against a person who has purchased or acquired the goods from a person who did not have title.

Title to goods may be acquired by their being legitimately appropriated from a state of nature. If a person takes possession of goods and no legal action is taken to recover them by a person with a better title, the statute of limitations may eventually bar the true owner’s title.

The ownership of goods is relative in nature. The person in possession of goods is entitled to retain and hold them against any person, who cannot assert a better title to them. It is not possible to assert the better right of a third party in a dispute. Only the person with a better title (the “true” owner) may assert his rights to the goods against the person in possession.


Possession of Goods

Possession is a central feature of the law of personal property. Possession and ownership of goods usually go hand in hand. Possession is usually indicative of ownership. Indeed, possession is presumptive proof of ownership.

The possessor can assert title as against all persons, other than one who can prove a better title. Even if the possessor’s title may be challenged by another, the statute of limitation may eventually bar the title of the person with the better title to take action.

Possession of movable goods does not necessarily imply or require physical possession. The intention to exercise control is usually sufficient. A person will usually possess the goods in his house or business premises, while he is physically absent. Control and the intention to exclude others are the key elements.

Generally, the true owner is entitled to possession, unless he has granted rights to another. For example, the owner may lease or hire goods. He may allow a third party to acquire a right to retain the goods, such as where he allows a person to acquire a lien for work done.


Title / Ownership and Possession I

A person who has possession of the property may not be its owner.  He may, for example, hold it on hire purchase or may hold it on loan from another. The person possessing property can assert possessory title as against all other persons, except a third person who has a better claim of ownership.

It is possible to lease or hire goods.  While goods are leased or hired, the immediate right of the hirer to recover possession does not apply.  The lessee /hiree has a right to immediate possession and the right to recover the goods from a third party.

Goods may be lent or simply sent for particular purposes to be worked on such as for repair. This is a bailment. The bailee has a special property in the goods.

If a person has mere custody of property, for example, a dry cleaner and acknowledges the superior right of the third party. That latter person continues in possession.  The former has custody; this is physical possession only.  A person with custody holds with the mere consent of the possessor or owner.


Title Ownership and Possession II

The law distinguishes between ownership (title), possession and custody of goods.  The owner is the person who created the goods, purchased or acquired them by gift from a person with good title to them. Ownership of goods may be acquired by a person taking possession of goods that were not previously owned or which had been abandoned.

If a person finds goods, which have a third-party owner, he is entitled to recover possession of them from another person who wrongfully takes them from him. The third-party owner could assert title against the finder, but this is irrelevant in the claim against the other. The possessor of personal property has title against all others, save the “true owner”, with demonstrable earlier and better title.

A person with possessory title may lose the goods to a rightful owner with the better title, who seizes them. Certain third parties are entitled by law to take goods.  This includes the sheriff, Gardai and other authorities.

Title may be acquired by original possession of a formerly unowned thing. It may be acquired by adverse possession, where the right of the “true owner” to recover possession, becomes barred by the Statute of Limitations. There is, therefore, a relativity in relation to the ownership and rights to the possession of movable property.


Possession as presumption of Ownership

The possession of goods creates a presumption of ownership.  This presumption may be displaced in particular cases. The importance of possession is emphasised by the principle of possessory title.  A person with possession may assert his title against everybody except a true owner or person with better title. The third party with the weaker title, cannot base his claim on another’s right.  Provided the other party has a better title he will win a direct contest in relation to ownership.

A person may acquire ownership of goods by adverse possession.  This is equivalent to the principle of squatting in relation to land.  It occurs when the rights of a person with the better title are extinguished by the Statute of Limitations.  Where the person does not take steps to assert his title against the person in possession, the title is eventually lost by the passage of time, generally six years.

The title of the possessor is good against the third party although it is one with the better title.  The possessor who holds goods as a bailee under a hiring or lease may assert possession only in accordance with the terms of the hire or lease. The bailee has an independent right to take action to recover goods from third parties.

Where possession is obtained dishonestly or with the proceeds of crime, the courts will not assist the wrongdoer.  This does not allow any person to take property on the allegation that it is held by a wrongdoer.  The law preserves the peaceful possession of the property.


Possession and  Ownership I

The possession of goods creates a presumption of ownership.  This presumption may be displaced in particular cases. The importance of possession is emphasised by the principle of possessory title.

A person with possession may assert his title against everybody except a true owner or person with better title. The third party with the weaker title, cannot base his claim on another’s right.  However, provided that the third party has a better title,  he can assert it.

The possessor who holds goods as a bailee under a hiring or lease may assert possession and has an independent right to take action to recover the goods from third parties, provided that this is consistent with its rights under the bailment.

Where possession is obtained dishonestly or with the proceeds of crime, the courts will not assist the wrongdoer.  This does not allow any person to take property on the allegation that it is held by a wrongdoer. The law preserves the peaceful possession of the property.


Possession gives Rights to Recover

Possession alone is sufficient to maintain a claim for trespass.  The right based on possession constitutes possessory title.

A person may acquire ownership of goods by adverse possession.  This is equivalent to the principle of squatting in relation to land.  It occurs when the rights of a person with the better title are extinguished by the Statute of Limitations.  Where the person does not take steps to assert his title against the person in possession, the title is eventually lost by the passage of time, generally six years.

A common law as applied in the Republic of Ireland both the possessor and true owner may recover compensation against a person who wrongfully detains goods.  The possessor may obtain, recover and keep the goods. He need not account to the true owner unless the true owner himself takes action.

Legislation in Northern Ireland and in England remedies this possession.  The person held liable may be entitled to unjust enrichment if he has to compensate the true owner


Possession Bailment  and Custody

The owner usually has an immediate right to possession. However, he may bail the goods and give others rights of possession therein. In this case, he is not entitled to possession. The third party, to whom has given lawful possession, may even maintain a claim for trespass against the “true owner”.

The person with physical possession of goods will not necessarily have possession in the legal sense. A person may be in custody of movable property, without being in possession of it. Custody is a lesser degree of physical possession without many of the more important characteristics of possession at law.

A person may have physical possession (or “custody” of goods) on behalf of another. For example, an employee may have physical possession of goods on behalf his employer. In this case, the employer has possession, but the employee has mere control or custody.


Nature of Possession

Possession implies the long-term control of goods coupled with an intention to control. For example, a person possesses the goods in his house, while he is away for a temporary period. Custody implies immediate control or physical possession. Usually, the one person will have all three, and no complications will arise.

Possession implies both an intention to control and actual control of goods.  The degree of control needed to acquire possession in the first place is greater than that required to continue in it.  The possessor can sue a third-party for trespass.

Once a person has acquired possession and has a continuous intention to retain it (e.g. goods at home or a bicycle outside a shop) this is sufficient to constitute continued possession. Possession will cease if both the intention to control and physical control of the goods are relinquished. For example, goods may be abandoned.


Possession of Contents and Things Buried in Land

The degree of control required for possession is dependent on and relative to the nature and value of the property.  Difficult issues of interpretation may arise where goods are unknowingly contained within other goods, which themselves are controlled. In this case, there may not be the requisite intention to control the latter.

Questions arise as to whether a person who owns or possesses land, controls all things buried or hidden in it. The general rule is that if the landowner is not in possession of the item before it is found, the finder can keep it, subject to the rights of the true owner.

Questions may arise as to whether the owner intends to control particular things on his land. The owner is usually held to have a better claim than a trespasser or thief. The law may prevent them from becoming unduly enriched. Similar rules apply to things which have been lost or abandoned.  The State is entitled to   treasure trove.  Treasure trove is gold or silver hidden in the ground.


Symbolic Possession

The possession of an item may be symbolic of the possession of other goods or things. Possession of a key may give symbolic or so-called constructive possession of a container and the goods in it.  The key issue is whether the key confers control.  This principle may apply to a car. Questions of intention and control may arise where other keys are retained.

Documents of title do not generally exist in relation to movable property (goods). There are some exceptional cases, whereby long-established custom and practice, documents may constitute the title documents to goods or may be symbolic of possession of the goods. In international trade, bills of lading constitute a document of title to the underlying goods.

Where goods are in the possession of a third-party, such as a warehouse keeper or an equivalent holder, the receipt issued for the goods does not of itself constitute a document of title.  The receipt is a mere token.  However, in accordance with commercial practice, it may constitute a symbolic or constructive possession, so that its delivery constitutes a delivery of possession of the goods.


References and Sources

Irish Texts
Modern law of personal property in England and Ireland 1989  Bell
Commercial Law White           2012 2nd ed
Commercial & Economic Law in Ireland        2011 White
Commercial Law 2015 Forde 3rd ed
Irish Commercial Precedents (Looseleaf)
Commercial & Consumer Law: Annotated Statutes 2000  O’Reilly
UK Texts
Personal Property Law: Text and Materials  2000  Sarah Worthington
Personal Property Law (Clarendon Law Series) 2015 Michael Bridge
The Law of Personal Property 2017   Professor Michael Bridge and Prof. Louise Gullifer
The Principles of Personal Property Law 2017  Duncan Sheehan
Crossley Vaines on Personal Property 1967 by J C Vaines
The Law of Bills of Sale 2017 James Weir
Palmer on Bailment 2009  Norman Palmer
The Reform of UK Personal Property Security Law: Comparative Perspectives  2012 John de Lacy
The Law of Personal Property Security 2007  Hugh Beale and Michael BridgeCases