Reasonable, but shouldn't the real owner of the property be entitled to some sort of compensation regardless? That becomes problematic if you don't have the means to retroactively buy the land from your neighbor, but it doesn't seem fair to just acquire it, free of charge.

I can understand this perspective, but that also means someone else's rights have been trampled over, even if long ago. What's needed is something that prevents this from even happening in the first place.

Not everything in life is perfect. The law isn't either, but it's reasonable to attempt to deal with imperfect situations.