Proprietary Estoppel: Family Feuds And Farming Fall Out

Proprietary estoppel is an equitable doctrine which allows the court to prevent a legal owner of property (usually land) from asserting their strict legal rights, when it would be unfair to allow them to do so. This doctrine often arises in cases of family feuds, where informal and undocumented arrangements relating to property rights go awry. A classic example involves a hardworking child who spends years working for low or no pay on their parent's farm, under the promise that it will all be theirs one day. Years later, when relationships turn sour and the parents renege on their promise, a proprietary estoppel claim can operate as a cause of action to prevent the parents from denying their child's interest in the farm.

In this article, we look at the central elements of the legal test, and the lessons to be learned.

The Elements of Proprietary Estoppel

There are three central elements to a successful claim of proprietary estoppel: a representation or assurance, detrimental reliance, and unconscionability. It is crucial to appreciate at the outset that proprietary estoppel is a particularly fact-sensitive area of law, and each case will turn on its own merits.

1) Representation or assurance

The first requirement is for the property owner to make some form of representation, assurance or other encouragement which induces the claimant to believe that he has or will enjoy some right or benefit over the owner's property. Examples of such promises include a father assuring his son that the family farm would belong to him one day (Suggitt v Suggitt), or trustees of a will trust assuring the son of the testator that he could occupy the family pub (the Albert in Esher) for as long as he wished (Preedy v Dunne).

The law is flexible when it comes to considering what is sufficient to amount to a promise, and the representation or assurance need not be unequivocal, but only "clear enough" (Thorner v Major). Encouraging a belief, or even acquiescence can be sufficient. So in Ramsden v Dyson, proprietary estoppel was established where the claimant spent money on property he believed he owned, while the true owner passively stood by without intervening.

2) Detrimental reliance

The next stage of the test is that the claimant relies on the promise or assurance to his detriment. This means that the claimant believed the owner's promise, took it seriously, and was induced by it to take a certain course of action that proved harmful in some way.

In the recent...