Possession claim – Family farm – Claimant son seeking possession and sale following death of father – Whether second defendant daughter acquiring interest by proprietary estoppel – Whether equity satisfied by prior transfer to her of parents’ 50% beneficial interest – Whether second defendant having claim over claimant’s 50% share – Claim dismissed — Counterclaim allowed in part
Upon the death of the deceased, his wife, the first defendant, inherited his entire estate under a 1977 will. The claimant was a son of the marriage and the second defendant was the daughter. The assets of the estate included an interest in a farm (plot A), the legal estate of which was held by the deceased, the first defendant and the claimant, with the beneficial interest split 50:50 between the claimant and his parents. An additional plot (plot B), which had been purchased for the farm in 1982, was in the claimant’s sole name. The land had been used by the family over the years for various businesses, including a market garden business and, later, equestrian businesses that the second defendant ran largely on plot A.
The claimant brought a claim for possession of both plots A and B and for the sale of plot A under section 14 of the Trusts of Land and Appointment of Trustees Act 1996. By their defence and counterclaim, the defendants claimed that the second defendant was the sole beneficial owner of plots A and B by virtue of a proprietary estoppel arising from assurances made to her by the deceased from the late 1980s onwards, and later affirmed by the claimant. By a deed of variation of the will, the first defendant transferred the deceased’s 25% interest to the second defendant and also purported to transfer her own.
The defendants’ evidence was that the second defendant had always wanted to work with horses, and had been promised by the deceased that should she obtain the relevant qualifications, she could have the farm. After leaving college, she had been allowed to set up her equestrian businesses on plot A, and had carried out improvements, including the construction of stables and other equestrian facilities and a house for her and her husband.
The claimant argued that, even if an estoppel were found, any equity in the second defendant’s favour had already been satisfied by the transfer to her of a 50% beneficial interest in plot A, the value of which exceeded that of her improvements. The defendants submitted that the court should not permit any outcome that unjustly enriched the claimant by enabling him to benefit from the increased value of the farm arising from those improvements.
Held: The claim was dismissed; the counterclaim was allowed in part.
On the evidence, although not offering to give the farm to the second defendant, the deceased had given her assurances, upon which she had relied, that he would make sufficient space available at the farm for her to pursue her equestrian career on a permanent basis, with the implication that she would receive a sufficient proprietary interest to enable her to do so after his death. The claimant had also made relevant representations.
The court had a broad discretion when deciding how any estoppel in the second defendant’s favour should be satisfied: Jennings v Rice [2002] EWCA Civ 159; [2003] 1 P&CR 8 and 100 applied. The value of the 50% beneficial interest that the first defendant had conferred upon the second defendant significantly exceeded the value of the improvements that the second defendant had carried out. Further, the court’s focus, in relation to the remedy of proprietary estoppel, was not upon stripping the giver of assurances of any unjust benefit, but upon affording to the recipient a remedy that was proportionate to the combination of her expectations and her detriment. If the transfer of the parents’ 50% interest to the second defendant satisfied her equity at no cost to the claimant, while leaving him to enjoy a part of the increase in value of plot A attributable to her improvements, that caused no injustice to the second defendant.
However, the transfer of the parents’ 50% interest still left the second defendant vulnerable to the claimant’s claim for a sale under section 14 of the 1996 Act. Consequently, in order fully to satisfy her equity, a remedy was required that ensured her continued occupation of the part of plot A upon which she lived and was carrying on her business at the time of her father’s death. So far as she was using part of plot B at that time, the claimant’s conduct did not justify any expectation that he would provide her with any interest in that plot, which he owned absolutely, rather than in plot A. However, a similar acreage should be provided for her within plot A. In the result, the second defendant’s equity was to be satisfied by giving the claimant the choice between selling his share in plot A to the second defendant for its present value or partitioning plot A so as to leave her with the area that had she occupied at the date of her father’s death, plus additional acreage to replace that previously used on plot B.
Per curiam: Where the equity arising under a proprietary estoppel was satisfied by one co-owner of property at no expense to the other, in respect of an estoppel arising from assurances given by both of them, there was no reason in principle why the first co-owner could not seek contribution from the second, by analogy with the position of joint sureties or joint tortfeasors.
Mark Blackett-Ord (instructed by William Sturges & Co) appeared for the claimant; Emily Windsor (instructed by Clarke Willmott, of Taunton) appeared for the defendants.
Sally Dobson, barrister
