Following on from my recent article concerning ways of challenging a will, this article will focus on making a claim in proprietary estoppel. This is a different way for a disgruntled beneficiary to challenge a will or estate.

Many proprietary estoppel cases relate to family disputes over farms, and there have been plenty of recent examples.

Proprietary estoppel claims can be made if the claimant can show all of the following elements:

  • A promise or assurance that they would be entitled to the property on the owner’s death;
  • That he relied on that promise; and
  • That in relying on the promise, he acted to his detriment. (E.g. by working for little or no money on the land, or spending money).

Representations / assurances

The first element is that the representor must have made a promise to the claimant. This representation is usually a statement that the claimant should expect to inherit specific property on the representor’s death. It is clear from the case law that this representation does not need to be direct to be enforceable. For example, in the case of Thorner v Major, an uncle’s indirect comments and inferences to his nephew were held to be assurances that the nephew would inherit the farm.

The courts have also made it clear that representations must not be too vague. Statements such as the claimant will ‘never want for anything’ and the representor will ‘look after’ the claimant have been held to be insufficient.

Reliance

It is not enough that the representor made a promise, but the claimant must have acted upon this promise.

In the recent case of James v James [2018], a son and his father worked together on the family farm. On the father’s death, he left the farming business to his wife and daughters; the son was left nothing in the will. The son argued that he had a claim in proprietary estoppel. Unfortunately for the son, this failed for a number of reasons. One of these reasons was that the court found that the son had not relied on any of the statements that the father had made. He had carried on as normal.

Detriment

Once the claimant has overcome the ‘reliance’ hurdle, must then show that this reliance was “to his detriment”. When looking at the issue of detriment, the detriment must be sufficiently substantial. It does not have to be the expenditure of money. In many farming cases, Claimants can show that they worked on the farm for little or no salary.

For example, in Moore v Moore, the Claimant relied on his father’s statements by devoting his working life to the farm and the business. This was to his detriment because he had given up any chance of alternative employment, as he truly believed he would inherit the farm from his father.

Remedy

If your claim in proprietary estoppel is successful, the court will deal with it on the basis that it creates an equitable interest. The court will then make the appropriate award. This will sometimes be the property as promised, or a cash sum.

Habberfield v Habberfield

There has been a recent case of Habberfield v Habberfield [2018]. Lucy Habberfield (the Claimant), was one of four children of Jane and Frank, who owned a farm. Lucy brought proceedings based on proprietary estoppel because on his death, Frank left everything to Jane. She alleged that Jane and Frank had assured her that she would take over the farm.

The court found that Jane and Frank had made sufficiently clear assurances over a long period of time, upon which Lucy had relied. Lucy had worked long hours on the farm, even while pregnant; at relatively low pay with very little time off. The judge was clear that Lucy had only gone through this as she expected to receive the dairy farm and she had invested much of her life into making the milking business a success.

When looking at relief, the judge considered the value of the farm and took into account the benefits which Lucy had already received (e.g. salary). He concluded that Lucy should be awarded a cash payment of £1,170,000 (out of a total value of £2,550,000 for the farm) to reflect her expectation of receiving the dairy farm.

He considered a cash payment (rather than a transfer of property) appropriate because he did not consider that it would be ‘fair to require the farmhouse to be split from the rest of the holding’. Further, he did not feel it appropriate to make an order which would force Jane to leave her home. Awarding a cash payment allowed the balance of all the parties’ interests without the need to sell all of the property.

This is a complex area of law and each case will turn on its own facts. If any of the above situations are familiar, our dispute resolution solicitors will be able to assist. Call us today on 0800 988 7756 for a FREE initial consultation.

proprietary estoppel