Limitation of Actions Consultation - Law Commission

(6) Actions in respect of Land
10.79 The limitation period in New Zealand for actions to recover land is twelve years
from the date on which the right accrued, 245
adverse possession being a necessary
condition for the right to be deemed to have accrued. 246
When the limitation
period expires against a person, his or her title will be extinguished. 247
But different
rules apply to Maori customary land, 248
and to land which is registered under the
Land Transfer Act 1952. 249
Where land is registered, adverse possession of at least
20, and usually 30, years will be necessary before title can be acquired as against
the holder of the “paper” title. 250
The New Zealand Law Commission has
recommended abolition of the limitation provisions relating to adverse possession,
in circumstances where the original dispossession amounted to trespass. 251
(7) Factors Postponing the Running of Time
10.80 Acknowledgement and part payment will operate to restart the limitation period in
the case of debts and other liquidated claims for money, and land-related actions,
but not otherwise. 252
The New Zealand Law Commission has recommended
reform of this rule, so that it would apply to all claims, but would require a plaintiff
to show that he or she refrained from bringing a claim in reliance on the
acknowledgement or part payment. 253
10.81 Time will not run against a plaintiff in the event of fraud or fraudulent
concealment, until the time when the plaintiff has discovered, or could with
reasonable diligence have discovered, the fraud. 254
For these purposes, fraud
includes failure to disclose facts in breach of an equitable duty, and is not limited
to fraud at common law. 255
It could also extend, in sexual abuse cases, to deceit as
245 Limitation Act 1950, s 7(2). There is an exception for Crown land, in respect of which the
limitation period is 60 years: ibid, s 7(1).
246 Ibid, s 13(1).
247 Ibid, s 18.
248 Ibid, s 6(1).
249 Ibid, s 6(2).
250 Land Transfer Amendment Act 1963, ss 3 and 4. See New Zealand Law Commission, op
cit, paras 348 - 350.
251 Report No 6, Limitation Defences in Civil Proceedings, NZLC R6 (1988), paras 359 - 362. Cf
the similar recommendation, now implemented, of the British Columbia Law Reform
Commission: see paras 10.99 below.
252 Limitation Act 1950, s 25. Acknowledgements must be written: ibid, s 26.
253 Report No 6, Limitation Defences in Civil Proceedings, NZLC R6 (1988), paras 268 - 274;
draft Bill, cl 11. The Commission also recommended that the limitation period should be
extended where the act or omission was being investigated by the Ombudsman, or where
alternative dispute resolution, arbitration, or litigation in another court, was being pursued
in relation to the same act or omission: ibid, paras 275 - 279; draft Bill, cl 7.
254 Limitation Act 1950, s 28.
255 Inca Ltd v Autoscript (New Zealand) Ltd [1979] 2 NZLR 700 (Sup Ct); Official Assignee of
Collier v Creighton [1993] 2 NZLR 534 (NZ CA). In the latter case the plaintiff’s appeal to
the Privy Council, which did not turn on any issue of law relating to the construction of s
28, was dismissed [1996] 2 NZLR 257 (sub nom Collier v Creighton).
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