Equitable Estoppel Flashcards
Equitable Estoppel - Estoppel by Representation
Jorden v Money [1845]
- Lord Cranworth: If a person makes a false representation to another and the other acts on it, the person
who made it won’t be allowed claim it was false after. Applies to representations of existing fact only.
Limitations: (1) only accommodates statements of existing fact not promises of intention (2) shield not a
sword (only a defence) (3) acts as a complete bar to Ps rights e.g. right to restitution
Equitable Estoppel - Promissory Estoppel
General rule?
Prom-E enforces promises of future intention. It stops a promisor reneging on his promise if he intended or it was reasonable that his promise be relied, and if the promisee did in fact rely on it to his detriment.
Equitable Estoppel - Promissory Estoppel
Hughes v Metropolitan Railway Co [1877] - Deferred repairs
- P + D landlord + tenant. Under a provision in the lease, P gave notice to D to do repairs within 6 mths
- After, they entered into negotiates re sale of the property by P to D. P promised D the repair work could be deferred pending the outcome of the negotiations. The negotiations collapsed.
- P then sought to have the lease forfeited as D hadn’t carried out the repairs.
- HOL held P was estopped from going back on his promise that repairs could be deferred.
Equitable Estoppel - Promissory Estoppel
Central London Property Trust v High Trees [1947]
- P + D landlord + tenant entered into long-term lease of block of flats. WWII hit. London evacuated.
- Thus D unable to sub-let all flats. P promised to accept reduced rent. War ended, flats sub-let again
- P sued for back rent arguing the variation was unenforceable as D gave no consideration for this
promise. Held P was estopped from recovering the back rent during the war.
Equitable Estoppel - Promissory Estoppel
Central London Property Trust v High Trees [1947]
- P + D landlord + tenant entered into long-term lease of block of flats. WWII hit. London evacuated.
- Thus D unable to sub-let all flats. P promised to accept reduced rent. War ended, flats sub-let again
- P sued for back rent arguing the variation was unenforceable as D gave no consideration for this
promise. Held P was estopped from recovering the back rent during the war.
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Combe v Combe [1951]:
UKCA confirmed prom est could only be used as a shield not a sword
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Re Wyvern Developments [1974] UK
- UK rejected that it cannot confer a cause of action and allowed it.
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Waltons Stores v Maher [1988] Australia - Lease - 40% Constructed
- P and D negotiating lease of land by P to D. Plan: P demolish a building on the land and erect a new one to D’s specifications. Negotiations neared ending, D suggested they were about to sign
- P began to demolishing. Then D had 2nd thoughts & instructed solicitor to go slow in finalising the
contract, but knew P started. Month later, D withdrew (built 40%) P allowed use prom-E as cause of action
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Cullen v Cullen [1962]:
Approved the limitation in Ireland
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Re JR, a Ward of Court [1993]
Sword in Ireland *
- Committee of elderly ward wanted to sell his house (dilapidated). He’d lived there for years with R, having represented to her it’d be her home for the rest of her life. Left everything in will to R.
- Held a case of Prom-E made: R acted to detriment in reliance on rep. Held entitled to life interest in house.
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Association of GPs Ltd v Minister for Health [1995
Reasserted the restriction
- Doctrine of equitable PE cannot create a new cause of action where none existed before
Equitable Estoppel - Promissory Estoppel - Defence Only, A Shield and not a Sword
Daly v Minister for Marine [2001]:
No mention of the limitation. Appeared to allow sword. Interesting case
Equitable Estoppel - Promissory Estoppel - Need Pre-Existing Contractual Relationship
Cullen v Cullen [1962]
No pre-existing CR here *
- P told wife he’d transfer the property to her. On basis of this rep, she and son built a portable house on the land. P then sought injunction to stop them doing so. Held estopped by his conduct from asserting title
Equitable Estoppel - Promissory Estoppel - Need Pre-Existing Contractual Relationship
Revenue Commissioners v Moroney [1972]:
Also no pre-existing CR. Defence against R for estate duty
Equitable Estoppel - Promissory Estoppel - Detriment
In Australia: Waltons Stores v Maher [1988
Australia’s HC emphasised unconscionability is enough
Equitable Estoppel - Promissory Estoppel - Detriment
Daly v Minister for Marine [2001
SC confirmed must have detrimental reliance
Proprietary Estoppel
How does this work?
Where a person acts to their detriment based on a representation that they will acquire an interest in property,
the person may be able to acquire that interest by way of proprietary estoppel (PE).
Proprietary Estoppel
Re Basham [1986] How to raise a PE
- Where Z is seeking to raise a PE against X, Z must prove:
(a) That X made an assurance that Z had or would be given an interest in X’s property,
(b) That Z relied on that assurance and
(c) That Z suffered detriment as a result of such reliance.
Proprietary Estoppel - Assurance
CF v JDF [2005] Ireland
- IESC said there must have been a reasonably clear, direct representation or inducement of some kind.
- This casts doubt on conscious silence being able to constitute assurance.
Proprietary Estoppel - Assurance
Gill v Woodall [2009] UK - Contrast Irish Position
- Held a rep could be sufficient for PE even if not express but made in oblique + allusive terms as long as given the background the person to whom it was made understood a definite plan: leave property to him.
Proprietary Estoppel - Reliance + Detriment = Detrimental Reliance
McCarron v McCarron [1997] - Labour
- IESC suggested the provision of Z’s own labour or services in respect of X’s property can be detriment.
Proprietary Estoppel - Reliance + Detriment = Detrimental Reliance
Gillett v Holt [2000] - Left School - 40y’s
- Detriment here was P leaving school to work on deceased’s farm for 40 yrs on belief he’d inherit it.
Proprietary Estoppel - Reliance + Detriment = Detrimental Reliance
Bracken v Byrne [2006]
- Held the only detriment was making a planning app + brief discussions w builder: not enough.
Proprietary Estoppel - Reliance + Detriment = Detrimental Reliance
McDonagh v Denton [2005] - 3rd party SP
- P claimed he’d bought the disputed lands. D said no. Held spending + maintenance not suff detriment but, on foot of this, sold it to a 3rd party+ was being sued for specific performance by them. This was detriment
Proprietary Estoppel - Reliance + Detriment = Detrimental Reliance
Joyce v Epsom Borough Council [2012]
D need not be aware of the detriment suffered by P for P to succeed
Proprietary Estoppel
What are the three traditional categories of proprietary estoppel?
Traditionally 3 categories of situation where proprietary estoppel would arise: Imperfect gifts, common expectation and mistake. Recently, a more general concept of unconscionability has been used to establish PE.
Proprietary Estoppel - Imperfect Gifts
What is the general rule?
If X wants to give his property to Z for no consideration, he can transfer it as a gift. For it to be enforceable, X must transfer the property in the way law requires it to make Z owner of it. Depends on the circumstances:
(a) If X wants to make the gift on his death, he can do so by means of a will.
(b) If X wants to make an inter-vivos gift, (i) the transfer of real property must be in writing but (ii) the transfer of personal property requires mere delivery of it to the donee.
Until transferred, the gift is imperfect + generally equity won’t enforce imperfect gifts. But PE is an exception.
Proprietary Estoppel - Imperfect Gifts
Dillwyn v Llewelyn [1862]
- P’s dad promised to transfer land to P. P built house on the land. Dad knew + consented. Informal memo showed it was dad’s intention to give it to P but not sufficient to transfer. Imperfect gift.
- Dad died. In will, he left it on trust for other parties.
- HOL held the fee simple should be transferred to P. Promise of gift made (assurance) and on the strength thereof (reliance) w dad’s knowledge, P incurred big expenditure on the land (detriment).
Proprietary Estoppel - Imperfect Gifts
Pascoe v Turner [1979]
- Parties lived together for long time in P’s house. P left to live with other woman, but assured D she could remain in the house + it would belong to her. D did repairs on it. P then sued for possession.
- Held D entitled to conveyance of the fee simple.
Proprietary Estoppel - Imperfect Gifts
Smyth v Halpin [1997]
- P asked dad to give him a site he could build house on. Dad said unnecessary as he’d have the family home after his mum’s death + suggested P build an extension to it (assurance). P did (reliance + detriment)
- Dad left house to wife for life + rest to daughter, P sued for interest. Held P entitled to fee simple.
Proprietary Estoppel - Common Expectation
General Rule?
PE may arise where parties have dealt with each other so as to give rise to a common expectation that one of them would acquire a certain interest in the other’s property (Pascoe and Smyth could be a CE).
Proprietary Estoppel - Common Expectation
Ramsden v Dyson [1866] set it out
- If a man, under a verbal agreement w a landlord for a certain interest in land, under an expectation, created or encouraged by the landlord that he shall have a certain interest, takes possession of the land with the consent of the landlord and on the faith of such promise w knowledge of landlord and w/o objection lays out money on the land, a court of equity will compel the landlord to give effect to such promise/expectation
Proprietary Estoppel - Common Expectation
Inwards v Baker [1965]
- Deceased encouraged son (D) to build house at D’s own expense on deceased’s land. D did so on the expectation encouraged by deceased that he’d be permitted to remain in occupation.
- Held D had an equity entitling him to live in the house for as long as he wished. In effect, deceased + his trustees on his death became estopped from denying that D’s licence to occupy was an irrevocable one.
Proprietary Estoppel - Common Expectation
Crabb v Arun District Council [1976]
- D led P to believed he could have access to his own (P’s) land via a road belonging to D. Relying on this,
P allowed his land to become otherwise landlocked. P held entitled, by PE, to a right of way as promised.
Proprietary Estoppel - Common Expectation
AG of Hong Kong v Humphrey’s Estate [1987]
Important to stress that detrimental reliance on self-induced expectation does not create a PE:
- P + D reached agreement express ‘subject to contract’ re the acquisition of D’s flats by P in exchange for grant of lease of specific property by P to D. P took possession of flats + fitted them out for civil servants.
- Before contract executed, D withdrew from transaction. P sued. D counterclaimed for order of possession, and P raised the defence of estoppel.
- Held to found estoppel, P had to prove not only that it had, to the knowledge of D acted to its detriment but also that D created/encouraged an expectation that they wouldn’t withdraw + P relied on this.
- Held D hadn’t encouraged it. No PE: H began + continued on terms that either party may change mind
Proprietary Estoppel - Unilateral Mistake
General rule?
A unilateral mistake as to the legal ownership of property by the party who acts to his detriment may found a PE but there must be some conduct on the part of the legal owner that affects his conscience.
Proprietary Estoppel - Unilateral Mistake
Ramsden v Dyson [1866]
- If a stranger starts to build on my land thinking it’s his own, and I, knowing his mistake, abstain from setting him right and leave him to persevere, a court of equity won’t allow me afterwards assert my title to the land on which he spent money on the mistake that the land was his own. Two things required:
(a) The person spending the money thinks he is building on his own land
(b) The real owner at the time of the expenditure knows the land belongs to him and not to the person spending the money in the belief that he is the owner. - Doesn’t apply where a tenant builds on his landlords land as he knows that it was not his.
Proprietary Estoppel - Unilateral Mistake
O’Callaghan v Ballincollig Holdings [1993] - not idle if its a tenant
- P claimed acquired title to a house by adverse possession. D rejected this + served notice to quit.
- P sought declaration of their title or a lien over it for works done based on PE. D counterclaimed for possession. P argued D stood idly by while they spent money: can’t repossess w/o paying compensation.
- Held as long as P’s tenancy subsisted, D not entitled to interfere with possession. D wasn’t entitled to interfere with their possession (as their landlord) so therefore he did not stand idly by
Proprietary Estoppel - Unilateral Mistake
Wilmott v Barber [1880]
- A lease prohibited assignment w/o lessor’s consent. The lessee let part of the lands to P w/o consent.
- Neither P / lessor aware of covenant. P took possession + spent money improving it + lessor knew. P then tried exercise option to buy lessee’s interest, but refused as lessor hadn’t given consent. P sought SP.
- Held lessor not estopped by his conduct in acquiescing in the expenditure as he wasn’t aware of his right
- Set out the five probanda:
(a) P must have made a mistake as to his legal rights
(b) P must’ve expended money or done an act (not nec on D’s land) on the faith of this mistake belief
(c) D (possessor of legal right) must know his right exists that’s inconsistent w the one claimed by P
(d) D must know of P’s mistaken belief of his rights (if not, nothing calls on him to assert his rights)
(e) D must’ve encouraged P to spends money/do acts directly or by abstaining from asserting his right
Proprietary Estoppel - Unilateral Mistake
Lester v Woodgate [2010]: - Probanda good proxy ofr uncon
Courts recognised the 5 probanda need not be satisfied in every case but are a
useful test of what may amount to unconscionable behaviour
Proprietary Estoppel - Unconscionability
General rule?
The move towards a test based on unconscionability was a reaction against the 5 probana. Idea: a PE arises when D, in asserting his legal rights, is taking advantage of P in a manner that’s unconscionable, unequitable
and unjust. The problem with this test is vagueness: one judge may consider it unconscionable, other doesn’t
Proprietary Estoppel - Unconscionability
Taylor’s Fashions Ltd v Liverpool Victoria Trustees [1982]
- Question: is it necessary in all cases that D knew of P’s mistaken belief? NO: Oliver J rejected that the 5 probanda need to be present in all cases. They do not. They are merely relevant factors to consider.
- No need for set rules dictating the considerations that’ll persuade court that a departure by the acquiescing party from the previous state of law/fact is so unconscionable that a court of equity will interfere. Flexible.
Proprietary Estoppel - Unconscionability
Lim Teng Huan v Ang Swee Chuan [1992]
- Parties jointly bought land. Agreement: P acknowledged (i) consent to D building house on it + (ii) he’d transfer his interest to D for unspecified land D hoped to acquire. D built house. P sued for his ½ share
- Held D built it in reliance on the agreement + it’d be unconscionable for P to renege on the assumption that D would get the sole interest on paying P compensation. P was thus estopped from asserting his title.
- It’s enough if it’s unconscionable for representor to go back on the assumption he permitted other to make
Proprietary Estoppel - Unconscionability
Lim Teng Huan v Ang Swee Chuan [1992]
- Parties jointly bought land. Agreement: P acknowledged (i) consent to D building house on it + (ii) he’d transfer his interest to D for unspecified land D hoped to acquire. D built house. P sued for his ½ share
- Held D built it in reliance on the agreement + it’d be unconscionable for P to renege on the assumption that D would get the sole interest on paying P compensation. P was thus estopped from asserting his title.
- It’s enough if it’s unconscionable for representor to go back on the assumption he permitted other to make
Proprietary Estoppel - Unconscionability
Gillett v Holt [2001] - Assurance - Deteriorated - Reliance focus
- P spent life working on D1’s farm. D1 repeatedly made promises + assurance over yrs that P’d get farm.
- 1992: P + D1’s relationship deteriorated. 1995: P sacked. D1 made will in favour of D2.
- P sought relief on PE. Trial judge rejected: no irrevocable promise that P would inherit it.
- Appeal: Held to focus on the promisor reserving himself to the power to change his mind misses the fundamental point that all estoppel claims concern promises that are initially revocable.
- What later makes them binding (thus irrevocable) is promisee’s detrimental reliance on them. Once that occurs, promisor can’t change his mind. PE arose: P got fee simple + money for exclusion from farm bus
Proprietary Estoppel - Unconscionability
McMahon v Kerry County Council [1981]
- P bought land to build school. Plan abandoned. Didn’t visit for 3 yrs. Then discovered D (knew of P’s purchase) trying to build on it. P complained so stopped. 4 yrs later D built 2 houses. Yr later P discovered
- P sued for possession: Held P didn’t stay wilfully passive while D built but unjust to let them recover: entitled to market value of site w/o house +damages. Must assess both’s conduct + consequences of order
Proprietary Estoppel - Unconscionability
Cobbe v Yeoman’s Row Management [2008] Narrow test
- D owned land w residential development potential. Negotiations to sell to P. Reached oral agr on core terms but no written contract. They regarded it as ‘binding in honour’ but knew it wasn’t legally binding.
- Pursuant to agreement, P sought planning permission for a residential development + encouraged by D
- P spent money + time. PP obtained. D then tried to re-negotiate core terms: increasing price £12m to 20m.
- Scott L rejected a test based just on unconscionability: approving Muchinski v Dodds, noted ‘prop rights need to be governed by legal principles + not a mix of judicial discretion, subjective views of fairness etc.
- Lord Scott’s essential holdings were:
(a) A proprietary estoppel operates to protect a right to or over property
(b) It does this by preventing a person from asserting / denying something that’s inconsistent w that right
(c) It follows from these that if a P seeks to raise PE, he must identify with precision:
(i) The nature of the right to or over property which an estoppel is necessary to protect and
(ii) The content of the estoppel i.e. what the Dis prevented from asserting or denying
In this case neither the nature of the right or the content of the estoppel were certain
(d) It’s not sufficient for P to merely identify unconscionable conduct on the part of the D. - This is a strict approach BUT this was parties in a commercial relationship w experience in development + negotiations. THUS it would not apply to Gillett nor Thorner v Major
Proprietary Estoppel - Unconscionability
Thorner v Major [2009] UK - 30y - Oblique - Contextual
- P worked unpaid on cousin’s farm for 30 yrs. No explicit promise but oblique references P would get farm
- P consequently didn’t pursue other opportunities. Died intestate but held PE established.
- Scott L held an assurance must be clear + unambiguous but Neuberger said the words must be assessed in context + not be too rigorous assessing clear + unambiguous as statement may have more than 1 meaning. Walker said assurance should be ‘clear enough’ but depended on the context. Conduct here enough.
Proprietary Estoppel - Unconscionability
Naylor v Maher [2018] IECA approved Thorner
- P worked unpaid on deceased’s farm for many yrs. Held the promises + reps made by deceased to P were intended by him to be relied on by P and they had been relied on + it was reasonable for P to rely on them.
- CA upheld finding P should get farm but not €150k that was under a 2nd later will (alternative bequest)
Proprietary Estoppel - Unconscionability
Coyle v Finnegan [2013] IEHC - Charge - Remuneration for D
- Held P who worked on farm of deceased on assurance it’d be left to him suffered detriment. Held should have a charge on the land for sum equal to proper remuneration: concept of unconscionability in judgment
Proprietary Estoppel - Unconscionability
Finnegan v Hand [2016] IEHC - 38y - Ind/Obli - ConT
- P worked on farm of deceased for 38yrs on modest pay. Said D made promises over yrs that led P to believe he’d get it. Court felt many of the promises indirect/oblique. Not named in will. Sued on PE basis
- Held due to the uncertainty of the alleged promises, difficulty in finding ingredients of PE (assurance, reliance, detriment) so used constructive trust to find in P’s favour instead.
Proprietary Estoppel - Remedies
Naylor v Maher [2012]
The court seemed to apply the expectation approach in finding P should get the lands
Proprietary Estoppel - Remedies
Coyle v Finnegan [2013]
- This was scaled back to remuneration from the lands commensurate with the disadvantage suffered. Thus it appears the court may start on expectation based approach but modify when necessary
