What is Proprietary Estoppel?
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Katie de Swarte
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What is Estoppel?
In general terms, estoppels operate where one party has acted on the basis of a statement made by another party, who is now attempting to change their position on the matter, contrary to what was previous said. The aim of an estoppel is to prevent this from happening.
What is Proprietary Estoppel?
Proprietary estoppel operates to modify rights over property and is capable of giving rise to new rights. In this respect, it is unlike any other form of estoppel in that it can give rise to a new cause of action. It is primarily applicable in respect of land, but is capable of affecting other proprietary rights.
What is a Proprietary Estoppel Claim?
To bring a successful claim for proprietary estoppel, the claimant must prove:
- A promise was made
- The promise was relied on
- The claimant suffered detriment as a result, for example, by working for free or spending money on the land or property with the expectation that they would inherit the same from the promisor.
These elements do not exist in watertight compartments. They are connected and are analysed by the court as such. A greater degree of detriment cannot, however, overcome an absence of a representation, promise or assurance.
Proprietary estoppel commonly arises in the context of farming disputes, and promises such as “one day, all this land will be yours” are made to the claimant, but the promisor dies without having fulfilled the promise.
What is the difference between proprietary estoppel and promissory estoppel?
Proprietary estoppel relates to land. This means that if the promise concerns the legal ownership of land or buildings, then a claim would be brought in proprietary estoppel.
For promises in relation to assets other than land, the legal basis is a promissory estoppel claim (also referred to as equitable forbearance). Promissory estoppel is an equitable development of estoppel by representation (another form of estoppel) which applies to representations as to contractual rights. The key difference between the two types of estoppel is that promissory estoppel requires a pre-existing legal relationship between the parties, which does not apply to proprietary estoppel claims.
What must you prove in a successful promissory estoppel case?
There are no hard and fast rules about what amounts to a “promise,” or what the claimant has to do to “rely” on the promise to their “detriment.” Proprietary estoppel is an equitable doctrine, which means it is concerned with equity or fairness. The court will consider all the circumstances of the case to decide whether the conduct being complained of is unfair and if something should be done about it- that is, whether it is unconscionable.
Below is an non-exhaustive list of factors the court would take into consideration when assessing a claim for proprietary estoppel.
- Who made the promise, to whom and when
- Whether the deceased was in a position to make the promise
- Whether the promise was clear and not merely a throwaway statement
- Whether there was any consideration for the promise
What award can be achieved from a successful proprietary estoppel claim?
The court has a high degree of discretion as to how it will provide a remedy. The key motivation for the court is to avoid an unconscionable result. For example, it can order the land to be transferred outright to the person who thought they would inherit it, give them a right to live on the land for a certain period, or simply give them a negative right to not be evicted from the land.
Proprietary Estoppel Case Law
Two new proprietary estoppel cases in quick succession are particularly note-worthy, clarifying that a claimant must prove the nature of a promise or assurance to succeed on the basis of proprietary estoppel.
Gladstone v White
The claimant in the first case lost her claim and had to leave the £15m stately home in which she had lived for several years. The elderly owner, David Gladstone, had been long-term friends with solicitor Leigh White, who moved into the property in 2017.
Gladstone had also appointed her as one of his executors and trustees and made her a beneficiary of the estate trust. The background is complex but, suffice to say that the friendship unfortunately soured and White was asked to leave the property. Gladstone also sought to remove her as trustee.
White refused to move out and claimed that Gladstone had promised her on numerous occasions that she would inherit the stately home. She failed to convince the court that she had relied on any such assurance because of the context in which it was given; and the “telling” absence of any written confirmation to that effect.
The court found that Gladstone intended only that White would have a “significant managerial role” rather than any beneficial entitlement. His comments during conversations fell far short of a promise that she would be its absolute owner.
Mate v Mate
In the second case, the High Court once again ruled that no promise of “sufficient clarity” was made in a case involving a farming family. Julie Mate claimed that her mother promised to leave her a share of the proceeds of the sale of farmland.
However, she later discovered her mother and brothers had agreed to sell part of the land to a developer without her knowledge a year earlier. She also claimed that her brothers – partners in the family business – had known of the alleged promises, which they denied.
Julie claimed to have relied on the promise to her detriment, having paid for a planning consultant for years in relation to plans to develop some of the farmland.
The court emphasised that it is a question of fact whether a defendant was aware of someone else’s promise or assurance and acted in a way that makes it unconscionable for them to resile. Mere standing by or acquiescence can be sufficient.
Julie had not demonstrated there had been promises clear enough to entitle her to believe she would receive an equal share of the sale proceeds. The judge ruled on the evidence that whatever was said to her by her mother was “too vague and unspecific a promise for it to have been reasonable to rely on it”.
Nor was there any evidence that her brothers were aware of what their mother may have said to Julie.
How our proprietary estoppel solicitors can help
In any proprietary estoppel claim, the individual relying on a promise or assurance must demonstrate that a sufficiently clear promise or assurance was given. If this first hurdle cannot be satisfied, the issue of detrimental reliance on an alleged promise will not fall to be considered.
If you’re considering making or changing your will, it is wise to consider whether anything you have said to those close to you could be taken as an assurance or promise that could lead to a dispute.
The contentious probate lawyers at Osbornes are experienced in disputes involving proprietary estoppel claims. If you believe you have a claim, contact us for specialist advice by calling 020 7485 8811.
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