Proprietary Estoppel

Question 1

what is the central concept to proprietary Estoppel?

Answer 1

“the essence of estoppel is that the court may award an interest in land as a remedy against a landowner who has conducted themselves in such a way that it would be unconscionable for them to assert their strict and unqualified rights as the owner, and therefore deny the claimant entitlement” - Layton v. Martin

Question 2

Moriarty (1984) outlines proprietary Estoppel as:

Answer 2

“Proprietary Estoppel will validate what the law of property says has no effect.”

Question 3

what is the purpose of formalities and which formalities are required for the transfer of land? and what is Estoppel role in this.

Answer 3

As property rights are binding on third party’s they require adherence to stricter formalities than other forms of contract. They require a deed per s.52 of the Law of Property Act 1925. the role of estoppel is to mitigate the harshness and difficulities that emerge as a result of a reliance on formalities.

Question 4

what was the original case concerning proprietary Estoppel?

Answer 4

Wilmott v. Barber (1880), this is the case where Lord Fry outlined 5 probanda which would need to be satisfied for an estoppel to arise. This probanda were incredibly restrictive and only applied in cases mainly involving fraud and deception

Question 5

What are the three informal ways in which proprietary estoppel may arise?

Answer 5

1. Promise of a gift - this can be seen in the case of Dillwyn v. Llewelyn
2. Common expectation - this can be seen in the case of Rasmden v. Dyson
3. Mistaken belief that was not corrected by the defendant - this was outlined by Lord Chancellor in the case of Ramsdon v. Dyson

Question 6

How many successful proprietary estoppel cases were there between 1880-1980?

Answer 6

None

Question 7

What was the case which operated under a less restrictive approach following Wilmott v. Barber?

Answer 7

Taylor Fashions ltd. v. Liverpool Victoria Trustees [1982] - this case concerned a renewal of a lease, putting a considerable amount of work into the property and not being able to renew it. The court in this case held that although an option to renew a lease is not a registerable land charge, estoppel could prevent the unconscionable denial of rights by the landlord. they held that the 5 probanda outlined no longer needed to be fulfilled and that unconscionably should relate to proprietary estoppel more. Oliver LJ stated that “PE should not be fitted within the confines of some preconceived formula serving as a universal yard stick for every form of unconscionable behaviour”.

Question 8

What are the requirements of Proprietary estoppel?

Answer 8

1. Assurance
2. Reliance
3. Detriment
   [all the above principles should be bound up in the principle of unconscionably]

Question 9

What is the principle of unconscionably in relation to PE?

Answer 9

Robert Walker LJ stated in Gillett v. Holt “it is important that the doctrine of PE should not be sub divided into 3 or 4 categories… more over the fundamental principle that equity is concerned to prevent unconscionable conduct permeates all elements of the doctrine in that end the doctrine should be considered all around”.

Question 10

Assurance.

Answer 10

assurance is an important element of proprietary estoppel as it ensures it is not merely a mistaken belief, therefore linking the activities of the claimant to the satisfaction of the estoppel.

Question 11

What is the nature of the assurance?

Answer 11

there can be both active and passive assurance.
there is also a difference highlighted between commercial and family assurances (this was drawn in the case of Cobbe v. Yeomans Row Management

Question 12

Commercial context vs. Family context for the operation of proprietary estoppel

Answer 12

This was outlined in the case of Cobbe v. Yeomans Row Management - which stated that if it is a commercial context the expression of the nature of rights should be more specific than in a domestic one (per Lord Walker), he contrasted this with family based cases where the claimant believed that the assurance was binding and irrevocable such as Baker v. Inwards

Question 13

Baker v. Inwards

Answer 13

A father told his son to build his house on his land because then the son could have a larger house, there was a mere common expectation that the land would pass from father to son. Upon the fathers death Inward gained his entire estate, and argued that therefore the house was his. The court held he was estopped from claiming so.

Question 14

Active assurance v. Passive assurance?

Answer 14

Active assurence:
if the landowner had by his words or conduct lead the claimant to expect that he has some interest in the land - this can be seen in the case of Pascoe v. Turner
Passive assurance:
if you do not correct someone under the impression that they will gain a property right in your land (this is commonly done through wills etc.) - this can be seen in the case of Ramsdan v. Dyson

Question 15

Pascoe v. Turner [1979]

Answer 15

A moved in with C and became his house keeper the became his lover, moved in to a house together, A had an affair and moved out, C told A that the house was hers and it was all fine, once the heartbreak had ended then C claimed he wanted his house back! The court held that the representation C had made was sufficient for proprietary estoppel

Question 16

Gillett v. Holt [2000]

Answer 16

G did left school to work on H’s farm, he did not pursue further education, and worked long hours for low wages, to be written into H’s will, following a dispute H removed G from his will and sacked him (after 40 years)
In this case the House of Lords held that there need only be a sufficient link between the detriment and the assurances made.
this case highlights the power of PE to override a will

Question 17

Cobbe v. Yeomans Row Managment [2000]

Answer 17

C was a property developer who entered into negotiations with A, reached an oral agreement that C would do planning application and A could sell the property for an agreed price. C underwent extensive detriment in order to get the planning permission, however after it was achieved C withdrew the offer to sell the house at the agreed price and demanded more - there was no contract agreed. In this case the Court held that C should not have been so naive - Lord Scott argued that unconscionably alone could not constitute a claim for PE, but need the other elements.

Question 18

What is the relationship between s.2 LP(MP)A 1989 and PE?

Answer 18

In the case of Yeamons Row v. Cobbe it was held that statue should over ride the doctrine of PE. this was widely criticised by academics as it is a strong departure from the traditional purpose of PE as a mitigation from the harshness in the requirement of formalities. However this did provide more certainty in the law. This was contrasted in the case of Thorner v. major [2009] - link the requirement of formalities on if the context of the transaction is familial or commercial

Question 19

Thorner v. Major [2009]

Answer 19

There was a disagreement in relation to a farm, although no express declaration was made, an insurance policy was handed to the claimant - the court held that this amounted to assurances of an interest in land. the court of appeal held that there was no estoppel due to the case of Cobbe v. Yeamons Row
House of Lords held: in familial contexts this could amount to a PE claim
Lord Walker argues that this would not open the floodgates due to PE’s narrow scope
it is a regrettable emasculation of proprietary estoppel to require the extent of the property to be strictly defined in every case, the strictness of the formalities would be inconsistent with the fundamental aims of equity

Question 20

Taylor v. Dickens [1998]

Answer 20

The old lady and her Gardener case:
the old lady’s gardener stopped charging her for jobs etc. he was omitted from her will, claimed he should have an interest in the estate.
Court held that because the old lady had not encouraged the belief it should not give rise to an estoppel - this decision has been heavily criticised - see Gillett v. Holt

Question 21

Passive assurance through a will.

Answer 21

Taylor v. Dickens held that a will could not be changed by PE if the testatrix had not encouraged a belief in an acquisition of an interest in land. Whereas Gillett v. Holt suggests that the inherent irrevocably of a will is irrelevant, it is the quality of the assurances. This case argues that it is the parties detrimental reliance that makes the assurance irrevocable. The case of Thorner v. Major held that it is the reasonable bystander who should judge the quality of assurances

Question 22

Reliance

Answer 22

This is heavily linked with the element of detriment. The reliance connects the assurance to the detriment. Therefore if you can prove detriment and assurance, reliance is presumed and the burden shifts to the defendant to disprove the rights.
This can be evidenced by the case of Coombes v. Smith

Question 23

Coombes v. Smith

Answer 23

This case is associated with the element of reliance.
Two lovers (C and S) whilst married to different people , S purchased a house and intended to live together. C  moved in and decorated the house etc. She then fell pregnant, S has another affair and unable to uphold 3 relationships ends it with C, however allows C to stay in the house until their daughter was 17. In this case the court held that emotional feelings of detriment such as leaving her husband and having a child should not amount to reliance.

Question 24

Detriment

Answer 24

“whether the detriment is sufficiently substantial is to be tested by whether it would be unjust or inequitable to allow the assurance to be disregarded - the essence is unconscionably”. - Gillett v. Holt

Question 25

What are the ways of detrimental conduct?

Answer 25

there is no all encompassing definition by the courts on this matter. Examples given are:

1. Improving land
2. Financial disadvantage
3. Non-financial disadvantage

Question 26

Detrimental reliance as improving land

Answer 26

Pascoe v. Turner - in this classic lover case, the women decorated the house and improved the land, the court held that substantial improvements could amount to detrimental conduct

Question 27

Detrimental relience as Financial disadvantage

Answer 27

Gillett v. Holt - there was an opportunity loss by working for a lower wage, as well as removal from the property ladder - Court held this amounted to detriment

Question 28

Detrimental reliance as non-financial disadvantage

Answer 28

in the case of Re Basham (deceased) the step daughters care for the father was beyond the natural boundaries of love and affection and therefore could constitute a detriment

Jennings v. Rice - in this case the gardener slept on the old lady’s sofa, ran errands and worked for nothing -in this case the House of Lords held that could amount to a detriment

Grant v. Edwards - this is a constructive trust case, but it was established that setting up home and moving in with someone could amount to a detriment - this case should be contrasted with that of Combees v. Smith.

Question 29

What occurs after the three/four requirements of proprietary estoppel have been fulfilled?

Answer 29

once you have fulfilled all three elements you are entitled to an estoppel equity. The courts determine the appropriate remedy in order to satisfy the estoppel created.
Plimmer v. City of Wellington Cooperation - “the court must look at the circumstances in each case to decide in what way can be satisfied”

Question 30

What is the consequence of the court having a high level of discretion in terms of administrating the justice surrounding proprietary estoppel?

Answer 30

The ‘palm tree justice’ established through giving the courts a high level of discretion means that there is less certainty in terms of administering proprietary estoppel, however there is increased flexibility by the court in reflection to the facts of the case.

Question 31

What are the different options the court could give as a remedy to proprietary estoppel?

Answer 31

• award of a leasehold (Gillett v. Holt)
• grant of a lease (Grant v. Williams)
• share of the beneficial ownership
• compensation (Dodsworth v. Dodsworth)
• no remedy (Appleby v. Cowley)

Question 32

Dodsworth v. Dodsworth

Answer 32

This case concerned a brother and sister who were given the impression they could live in a house when they returned from Australia. They spent money upgrading the house, and then kicked out of the house. They claimed an estoppel and the court granted them the money they had spent on upgrading the lease rather than any property right.

Question 33

Appleby v. Cowley

Answer 33

Barristers chambers allowed a licence in a building, spent money renovating the premises, then kicked out of the premises. Court held they did have an estoppel however they had been in the property for a while therefore it was no longer unconscionable for them to have to leave the property.

Question 34

What satisfaction of the equity estoppel appropriate?

Answer 34

The court has a wide discretion when considering what satisfaction of the equity estoppel is appropriate, Griffiths v. Williams “the court has to determine what is fair to make order between the parties for the protection of the claimant”
Moriarty (1984) “Normally…a remedy will be chosen which gives the party precisely what he has been led to expect, but occasionally where joint rights to land have been represented, he may get money instead “ - the problem with this approach is that sometimes it is not always clear what interests in land the claimant was expecting, espc. if they are passive, therefore the Dodsworth approach to considering the detriment to the claimant should also be used - proportionality.

Question 35

Proportionality

Answer 35

In considering the satisfaction it is important to balance the two positions of the detriment suffered and the assurance made. This can be seen by the case of Jennings v. Rice, the estate in which the gardener was claiming was £450,000, but he was awarded £200,000 - the court considered that they did not have completely unfettered discretion on what was fair, ad considered his loss of earnings as well as the determent suffered.

Question 36

Where is estoppels place in relation to priority rules?

Answer 36

s.116(a) LRA 2002 states than an inchoate estoppel can amount to a interest in land capable of binding successors in title, therefore if you are in actual occupation at the time the assurance was made (presuming it gives rise to an estoppel) you could potentially have an overriding interest per sch 3 para 2 LRA 2002

Question 37

Why is it important that an inchoate estoppel is capable of amounting to a interest in land capable of binding a successor in title?

Answer 37

because an estoppel does not emerge until the court has handed it down therefore it would be too late for sch 3 para 2 LPA 1925.

Question 38

John Mee [2013] Proprietary Estoppel and Inheritance “enough is enough”

Answer 38

outlines:
-palm tree justice outlined in Dickens v. Taylor has not materialised
- argues that as Proprietary estoppel favours the claimants, and in cases such as Bradbury v. Taylor the claimant had a loose claim to estoppel but it was allowed to succeed
“proprietary estoppel is a very powerful and unpredictable doctrine”
the flexibility of the doctrine has resulted in more expensive litigation and therefore it is not in the public interest

Question 39

Proprietary Estoppel and property rights - Bright and McFarline [2005]

Answer 39

• argues that the wide discretion which has come to characterise proprietary estoppel is false and states that “just because the remedy is not moored to the expectation of the claimant, doesn’t mean it is a drift in the sea”
  however argues that when a property right is awarded it should be to protect the reliance of the claimant, and the court should be careful when awarding this
  this interpretation is at odds with that of the law commission relating to s.116 LRA 2002

Question 40

Wayling v. Jones

Answer 40

This case concerns reliance, when a gay couple lived together and one of them asked for an increase in pocket money, and the other said it will all be yours one day. The court adopted a more liberal approach than in the case of Coombes v. Smith, and allowed an estoppel to arise. This case was upheld in Campbell v. Griffin

Question 41

Dixon (2010)

Answer 41

Unconscionability is therefore not a cover for unregulated judicial discretion, nor a loose term to describe a general sense of unfairness, but a concept which can be used to discriminate objectively between valid and invalid estoppel claims.
Unconscionability means going back on an assurance about formality, in conjunction with a ‘rights assurance’ that is ‘certain enough’ and detrimental reliance.