An Insight into the Complicated Topic of Proprietary Estoppel

The legal world is never boring or straightforward as the case of Cook-v-Thomas demonstrates; it highlights the difficulties faced by occupiers of land seeking to claim a legal interest on the basis of the principles of proprietary estoppel and constructive trust.

The claimant, Mrs Cook (now aged 92) and her husband acquired a farm in Ross-on-Wye in 1959.  Their daughter Pauline (now aged 60), the First Defendant worked on the farm and ran a riding school.

Pauline married in 1990, it seems her parents were unhappy at the marriage and the parties did not speak for the next 5 years.  Mr Cook died in 1995 and Mrs Cook became the sole legal owner of the farm.  Things had improved by 1996 when Pauline and her husband moved back to the farm living initially in a mobile home.  They took over the running of farm and carried out extensive repairs to the farm buildings and the farmhouse itself.

Pauline and her husband then moved into the farmhouse in 2001, but they fell out with Mrs Cook again in 2002.  Despite the fact that they were not on speaking terms, they all remained living together in the farmhouse. 

In 2008 Mrs Cook issued legal proceedings seeking to evict her daughter and son-in-law.  The Defendants argued that Mrs Cook should be precluded from enforcing her strict legal rights to obtain possession on the basis they had a right to occupy the farm for the rest of her life, and to acquire the property in the event of her death.

The Defence was based upon on a number of legal principles including proprietary estoppel, constructive trust and unjust enrichment.  The Defendants relied upon the fact that over the years Mrs Cook had made four promises to the effect that if Pauline and her husband were to move into the farmhouse to look after her, she would allow them to live there and farm the land for as long as they wanted, and to inherit the farm in the event of death.  The Defendants claimed that in reliance upon such promises, they acted to their detriment in undertaking various works of improvement to the farmhouse and they took over the responsibility of running the farm.  Mrs Cook disputed that any such promises or assurances had been given.

The Judge at first instance found that two of the promises did not amount to a commitment that the Defendants could remain in the farmhouse, that one of the promises had not in fact been made and that a third promise that its “all going to be yours when I am gone”, was not a representation giving rise to an estoppel and the Defendants did not rely upon in it in any event.

The Court of Appeal found there was no basis upon which to challenge the decision of the trial Judge and dismissed the appeal.

To establish a proprietary estoppel claim it is necessary to show that the owner of the legal interest has made an express oral representation in terms that the non-owning party will acquire a beneficial interest in the property, which the non-owning party then relies upon to their detriment.

The court in this case found that the acts of reliance, claimed by the Defendants including the running of the farm and improvements to farmhouse, were undertaken for their own personal benefit.  The court also considered that the comments made by Mrs Cook, to the effect that she would make a will in her daughter’s favour, could not be regarded as a representation to the effect that she was to have a present proprietary interest in the farm, the comments were simply an expression of her intention.

This case illustrates the difficulties involved in bringing such claims, and the substantial evidential burden which the non-owning party is required to overcome.  Promises made by parents, to the effect that they will leave their property to the children in the event of their death, are no more than an expression of intent and cannot be relied upon to establish a claim to an interest in property. 

The case also emphasises the importance of obtaining independent legal advice at the outset if you are intending to share occupation of property particularly with other family members.

For more information, or to speak to Sue, call her on 01743 280280 or email her at sue.haylock@lblaw.co.uk.