Proprietary estoppel – Reliance – Detriment – Judge finding that respondent entitled to beneficial interest in appellant parents’ farm by proprietary estoppel – Order corrected to declare that respondent having equity nature and extent of which to be determined at subsequent hearing – Whether judge erring in finding reliance on operative representation – Whether detriment established – Appeal allowed in part
The respondent was one of three daughters of the appellants, who owned a pedigree dairy farm in West Wales. Following an argument between the parties in August 2012, at which time the respondent was living and working at the farm, the appellants terminated her employment and brought proceedings to evict her and her family from the farmhouse.
A preliminary issue was tried as to whether the respondent was entitled to a beneficial interest in the farm, or other equitable relief, by proprietary estoppel, with the nature and extent of any such interest to be determined at a further hearing. The judge found that the respondent had a passionate interest in pedigree milking cows and had worked at the farm for four years until 1989, when she was 21 years old, in reliance on representations by the appellants that the farm would one day be hers. He found that the respondent had left in 1989 owing to a disagreement with the appellants over her choice of partner but, between 1991 and 2009, had returned to live and work at the farm for various periods. In 1998, she had signed a partnership agreement on the understanding that the appellants would bring her into their farming partnership although, unknown to her, the appellants had never signed it themselves. For a time in 2007, she had worked elsewhere as a technician for a company that offered livestock reproduction services. The judge found that the recompense that the benefits that the respondent received were less than full recompense for her work on the farm, which involved long hours on most days.
On the basis of his findings, the judge held that the respondent was entitled to an immediate beneficial interest in the farm. It was later conceded that he had erred in so finding and that his order should be amended to declare only that the respondent was entitled to an equity over the farm and/or farming business, the nature and extent of which was to be determined at the subsequent hearing.
The appellants’ appeal against the judge’s order was allowed to that extent. They further disputed whether the respondent was entitled to any equity at all. They submitted that the judge had made no finding that the respondent’s work between 1991 and 1998 was in response to any operative representation by the appellants and that, in any event, working for less than full recompense was not in itself detriment since low pay was endemic in the farming industry.
Held: The appeal was allowed in part.
(1) Read in context, the judge had found that the respondent did rely on the representations made by the appellants and that her reliance was reasonable. He had been entitled to find that, up to 1989, the respondent been led to understand that if she did not leave home but continued to work on the farm and show her commitment then the farm would be hers one day. Although respondent had left the farm in 1989 because her parents disapproved of her boyfriend, the judge’s failure to make positive findings about the various pleaded representations from 1991 to 1998 did not mean that the court should find there to have been no operative representations after 1991 and before 1998. The assurances given to the respondent about her future inheritance were tied to her working on the farm. When dealing with the issue of detriment flowing from reliance on those representations, the judge had taken account of the fact that, between 1991 and 1998, the respondent did additional work on the farm, above what she was paid for milking, for no extra pay. He would not have done so had he thought there was merit in the suggestion that there was no operative representation during that period. It was unlikely that the judge was not accepting the respondent’s evidence that her level of pay was expressly coupled to the representation that the farm would one day be hers. He had plainly held that there was detrimental reliance on that representation once the respondent resumed working for her parents.
(2) The judge had been entitled to find detriment to the respondent. Regarding the submission that low pay was endemic in the farming industry and not necessarily reflective of detrimental reliance, the judge had not held that the detriment to the respondent was exclusively financial. The respondent’s work for the livestock reproduction services company was an illustration of how she would have fared if free of her obligations on the farm. She would have been able to work shorter hours in a working environment of her choosing, without the difficult working relationship that she had with her parents. Nor had the judge failed to take into account the benefit to the respondent from living at the farm. Once it was accepted that the detriment to the respondent was not purely financial, the judge was not bound to quantify the benefit of free accommodation, which was instead one factor that he had to keep in mind in the evaluative exercise. He had been entitled to find that there was substantial detriment when the rewards of the company job, with its better lifestyle, were contrasted with those of living at working on the farm, with its free accommodation but its greater burdens in terms of working hours and difficult working relationships.
It followed that the appeal would be allowed only to the extent of the concession set out above, overturning the judge’s finding that the respondent was entitled to an immediate beneficial interest.
Per curiam: It was doubtful whether a list of essentially factual preliminary issues, coupled with a split trial procedure, would normally be appropriate in a claim for equitable relief based on proprietary estoppel. Such claims required a holistic approach, which the procedure adopted in the instant case did not facilitate.
Timothy Fancourt QC and Elizabeth Fitzgerald (instructed by Michelmores LLP, of Bristol) appeared for the appellants; Leslie Blohm QC (instructed by Hugh James, of Cardiff) appeared for the respondent.
Sally Dobson, barrister
