#3530 - Proprietary Estoppel - Land Law

PROPRIETARY ESTOPPEL

• A encourages B to believe he has a right over A’s land or that A will confer such a right on him, and B then, in reliance on that belief, acts to his detriment, B may be entitled to relief (a right in rem).

• Requirements

1. Licensee firmly believed that either licensor has given him the right over his land or that he will do so

• Belief must be definite (not mere possibility) (Yeoman’s Row Management v Cobbe)

• Wills - belief sufficiently definite if D promises to leave property to C &announcesto his family on important family occasions (Gillett v Holt)

• Notmuch specificity: enough to say ‘we’ll sort something out’ if it implies C would have a right

• Right doesn’t have to be identified w/great degree of precision

• Thorner v Major - C believed he would inherit D’s farm, debate as to what it comprised; court took it to cover buildings, live & dead stock, other assets of farming business & money in D’s business acc.

• Right doesn’t have to be in rem – enough C believes in a right over land/ property, not that D will do something for him

• No representation but C relied = no equity

• Crabb v Arun - C promised right of way to access his land by council sold his property w/out reserving a right of way, council repudiated, built a wall, then offered to reopen @ 3K cost. C successfully claimed prop. estoppel.

2. Licensee has acted to his detriment in reasonable reliance on that belief

• Any act sufficient, as long as it’s detrimental

• i.e. reliance left C worse off than he was before acting on D’s assurance

• Mostly uncontroversial but seems to be flexible:

• Gillett v Holt- C suffered a detriment when, believing he’d inherit D’s land, remained in D’s employment, continued living rent-free in D’s house & and paid for son’s boarding school. Possible C was worse off but to conclude so involved speculation about how C would have fared otherwise

• Greasley v Cooke- unconscionability& detriment run together. D worked as a maid and lived with P’s family for 30 years, was assured she could remain after P’s death; had looked after the house and an ill member of P’s family hence it was unjust and inequitable to resile.

3. Belief was a reasonable product of assurance (i.e. encouragement or acquiescence) by the licensor

• Spectrum of 2 extremes:

1. C developed the belief b/c of what D said – straightforward

2. C conceived it himself/b/c of something he picked up elsewhere & D didn’t correct him must prove D’s awareness that C held that belief, otherwise failure to correct is irrelevant

• Belief was at least a but for cause of the detriment

• Wayling v Jones – trustworthiness may also be factor

• Onus of proof on D –must show absence of reasonable reliance by C

• If D said something that C has put an interpretation on that a reasonable person wouldn’t have, D isn’t liable (hasn’t been always followed)

4. Unconscionability – a stand-alone 4^th requirement or underlying consideration for the court?

• D must have some resp.: no knowledge of specific sale but awareness of general intent (Crabb v Arun)

• Cooke (connected to detrimental reliance) - word ‘unconscionable’ does 2 jobs:

  1. points to equity tradition & discretionary nature of court’s jurisdiction

  2. indicates issues relevant in decision. Used as description of whole process of inquiry/one of items on checklist, summing up other factors. Decisions involving it aren’t mere value judgments - court examines detrimental reliance

• Birks (not a separate requirement) - treating it as separate element would be like 5^th wheel to the coach (specifically, using ‘unconscionable’ to describe the state of a mind)

• Lord Walker in Yeoman’s Row (unifies & confirms other elements) - unconscionability should be used as objective value judgment on behaviour, regardless of individual’s state of mind. Its role is to unify & confirm other elements. If they are present but result doesn’t shock the conscience of court, analysis must be looked at again.

• Dixon (independent requirement) – unconscionability exists by definition whenever there’s assurance, reliance & detriment, b/c non performance of it will always be unconscionable. A flawed & unprincipled approach to view it as no more than a function of these. It’s an independent requirement; i.e. need double assurance A promised to give B a right in the future + led B to believe A is under current legal duty to give B that right.

• Gillett v Holt (overriding, umbrella requirement) – feeds into the assessment of assurance, reliance & detriment, and provides a general evaluative tool through which court considers claim in entirety.

• Problem(Hopkins) – formula lacks transparency the move to individualized, discretionary justice gives rise to particular concern re electronic conveyancing which may place greater emphasis on prop. estoppel. Challenge for courts is to take advantage of its inherent characteristics of discretion & flexibility, whilst maintaining a principled approach. Lack of transparency & consistency suggests they aren’t doing this – result is uncertainty & lack of guidance which act as incentives to litigation.

• Relief

• Outcome of claim lies @ discretion of court

• Pascoe v Turner: C relied on D’s promise he could reside for life, spent some money on repair, got a fee simple, not merely right to reside (confirmed inThorner v Major);

• Jennings v Rice: C looked after O, was promised 400K but got 200K b/c that was all he needed

• court wants to avoid disproportionality b/w expectation & detriment in instances of uncertainty, it’s likely to look @ the detriment as a tool for assessing (try to do justice & won’t give extravagant, uncertain or greatly out of proportion remedies)

• Sledmore v Dalby: daughter & son in law worked in reliance on a promise they could occupy the house, but awarded nothing, since didn’t need money, whilst D desperately did

• Estoppel Equity

• I.e. nature of C’s rights under doctrine b/w the time when requirements are met and the judgment of court.

  1. B’s position b/f court’s order in his favour – B only has ‘estoppel equity’; i.e. right to go to court. s116 (a) LRA 2002 (registered land) - ‘equity by estoppel has effect from the time equity arises...’ seems to mean C has ‘equity by estoppel’ immediately requirements for establishing it have been met.

  2. B’s position after court’s order in his favour – normally, simply need to see if court has recognized that, through prop. estoppel, B has acquired a property right re A’s land. In some...