SB 286 - ADVERSE POSSESSION CHAIRMAN HALFORD announced SB 286 to be up for consideration. MR. DAVE GRAY, Staff to Senator Mackie, sponsor, said SB 286 was introduced to bring attention to the State's current laws governing adverse possession of private property and its suitability to land ownership and to modern advances in the location, description, and recording of private lands. The legislation addresses two conditions of adverse possession. The first is the "squatter" situation where a person knowingly and with intent occupies another person's property. After ten years of use, the occupant can claim ownership by adverse possession under current law. In addition, there is no compensation to the real owner for his or her loss. In the second instance, the person's occupancy of the property is under a good faith belief that they have clear title or other documentation establishing their ownership. This instance also includes the adjacent property owner who mistakenly locates on neighboring land. In each situation, the property can be claimed after seven years of adverse possession. Much of the private land in the State is now located in remote, wilderness areas of the State because of the ANCSA settlements and other properties associated with historical mining activities. Because of their remoteness, these properties are more subject to inattention by their owners and therefore susceptible to adverse possession. SB 286 proposes to eliminate any adverse possession claim by a person who knowingly and intentionally occupies land they do not own. When the occupancy is inadvertent, the legislation increases the standards for adverse possession. In the latter case, the original owner must be compensated. MR. RICHARD HARRIS, Sealaska Corporation, said they are the largest private land owner in Southeast Alaska. He said the adverse possession doctrine was born in the middle ages and has little applicability to the 20th Century. State and federal lands cannot be divested of title through adverse possession. Neither can native corporation lands that are in an undeveloped state. However, all private lands, including ANCSA lands, if they are in a developed state, are subject to adverse possession. Sealaska has had some direct adverse possession experience with its non ANCSA lands and is aware of other private land owners with similar problems. The "squatter" statute requires the squatter to possess the property for 10 years and, thereafter, the actual owner of the property is barred from either bringing any action against that individual to throw them off the property or to seek any compensation. You effectively lose title to your property. The other type is the "color of title" which is an honest belief that the possessor really owns the land. The State Supreme Court has stated the doctrine serves a useful public purpose. If the owner leaves land idle, it should be put to some beneficial use and if it is done by a squatter, so be it. The court also justifies adverse possession because it keeps stale cases out of court. Neither of these justifications keeps cases out of court, Mr. Harris said. SB 286 abolishes the squatters statute, though it reserves any rights a person has acquired under the law before it was abolished. It also limits the availability of this doctrine to two narrow circumstances where there are arguable good policy justifications for allowing adverse possession. There is a good public policy qualification for a situation where the property owner in good faith occupies the property beyond the boundaries. After 20 years of open adverse possession the possessor could acquire quiet title to the property. It has to be done in a good faith manner and the possessor must prove entitlement and pay the land owner. The payment makes it equitable. It is very difficult to police lands when they are in large remote areas to assure yourself that no squatter has taken residence. They have had experience that even though the squatter has taken residence, the difficulty of moving people off a property is also very frustrating and quite time consuming. The Attorney General's Office indicates that under some circumstances this might create new litigation or may place additional burdens on the court, but they agree that this is speculative and there is no evidence to support this. SENATOR TORGERSON asked how this would affect rights-of-way or roads that are built on other properties that have been there for a number of years. MR. SORENSON, Council for Sealaska, answered that any interest that has been there for over 10 years would not be affected by this legislation. Up until 10 years, however, the Supreme Court rules that it is trespassing. SENATOR TORGERSON asked if they had squatters on their land. MR. SORENSON answered yes, one in Cordova which has been taken care of. They tried to sell land that people were squatting on to the city of Cordova and finally, in order to clear the title for transfer of title, they had to buy someone off. Another circumstance happened near Wasilla with a squatter. They see this occurring in various locations. SENATOR TORGERSON asked if they were grandfathering anyone in under this legislation. Number 230 CHAIRMAN HALFORD said the answer was no unless there was a perfected right. SENATOR TORGERSON asked if there were any notice requirements. MR. SORENSON answered no. He added if a land owner discovers that someone is using their property, there is the right to give them a notice to quit under the statute, and then you can bring an action for unlawful detainer or ejectment. This is a straightforward procedure. From the possessor's standpoint, their actions have to be fairly open and notorious. SENATOR SHARP asked if the squatters were on the land when it was acquired in the instances in Cordova and Wasilla. MR. HARRIS answered in Cordova the property was used frequently by the summer people coming in and processing fish in a camp. Out of that there were people beginning to establish year-round occupancy, so they were able to claim they were in possession of that property. They went through several efforts to evict which was very awkward and difficult. They ended up buying one person off before they could trade the land to the city. He said the 10 years doesn't run against any one particular owner; it's a continuous 10- year period. CHAIRMAN HALFORD said that action has to have been taken before 10 years; you don't actually have to get them off. MR. HARRIS agreed that was correct. SENATOR TORGERSON asked what the impact would be on the University, the Railroad, and municipal governments. Number 300 MR. HARRIS replied that it wouldn't affect any land except private lands. There is a specific statute that says the title to University land cannot be gained through adverse possession and another specific statute that says municipal lands are not subject to adverse possession. CHAIRMAN HALFORD said he didn't know of any western state that has eliminated adverse possession. There are differences in the number of years it requires. He thought it was legitimate for people who own land to be able to get people off the land they own, but the adverse possession rule came from one of the basic tenets of ownership which is control. MR. HARRIS said he was right that Alaska would be the first state to take this kind of action. CHAIRMAN HALFORD said he was interested in looking at ways to make this work, but the laundry list on page 2 was so complete that he couldn't think of a single thing to add to it to make sure it didn't happen. MR. CHARLES MCKEE said he wished they would have noted that this is common law they are discussing and opposed SB 286. CHAIRMAN HALFORD noted that although this is based on common law, there are two Alaska statutes that deal with adverse possession. He said he would talk to the sponsor to see if there was something that could help with regard to enforcement actions that would be a little bit less extensive than the list on page 2.