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Following on from last year's Supreme Court decision in Guest v Guest, which provided an important clarification on the Court's approach to applying the doctrine of proprietary estoppel, further useful commentary has arisen from the recent decisions in Mate v Mate and Gladstone v White.
When we look at applying the equitable doctrine of proprietary estoppel, the key test is whether there is unconscionability in allowing the promisor to resile from their promise or assurance.
To assess this, we need to go back to the following fundamental limbs:
Lord Briggs' majority decision in Guest v Guest provided us with the following key points to note when assessing the likely success of a claim in proprietary estoppel:
In this family farming case, a daughter brought a claim for proprietary estoppel, and, in the alternative, unjust enrichment based on the work she had done in securing planning permission for residential development of some of the property.
She claimed to have worked over several years with the knowledge and encouragement of her mother and brothers to secure the land’s release from green belt designation, on the basis that she would receive a one sixth share of the £8.7m eventual sale price.
The mother responded that she had simply promised to look after her children financially. She referred to her power to split the sale proceeds and was never specific about the share she hoped to pass to them.
Judgment
The judge found the promises made by the mother to her daughter were too vague and therefore the claim failed. However, the judge awarded £652,500 to the daughter for unjust enrichment on the basis she had provided services similar to a land promoter paid on commission (discounted to reflect, amongst other things, that she was not a professional adviser).
Days later, the Court handed down another judgment, this time in relation to a solicitor (Ms White) who refused to vacate the stately home of an elderly owner (Mr Gladstone) who had invited her to live there. Ms White was also an estate trustee and beneficiary.
The two were friends for several years but the relationship deteriorated, and Ms White was asked to leave. She was also removed as trustee and beneficiary.
Ms White claimed that Mr Gladstone had promised her that she would inherit the property and that she had given up her career as a solicitor to devote her time to him and the family. It was therefore unconscionable for him to go back on this promise.
Mr Gladstone argued she was never intended to be the main beneficiary and no express assurances or promises had been given.
Judgment
For reasons similar to those given by the Judge in Mate v Mate, the claim was unsuccessful. Mr Gladstone was granted an order for possession on the basis the assurance was not unambiguous and sufficiently clear in the circumstances. The Court also drew a distinction between a promise and a statement of intent (the latter could change).
In addition to the guidelines set out by Guest v Guest, it is important to be aware of how meticulous the Court will be in closely examining and considering the context of the case and the nature of the promise/ assurance in light of the circumstances.
In Mate v Mate, the Court emphasised that the doctrine of proprietary estoppel is very much dependent on context:
“The assurance must be unambiguous and must appear to have been intended to be taken seriously. What is meant by this is that the assurance must be ‘clear enough’, but what amounts to sufficient clarity in this context is… hugely dependent on context"
The burden is therefore clearly on the Claimant to establish all of the elements of a claim based on proprietary estoppel.
It is worth remembering however that proprietary estoppel is the only estoppel doctrine that can be used to bring a claim (i.e., as a sword as well as a shield).
What are the considerations for charity beneficiaries of an estate defending a proprietary estoppel claim?
It is important to consider the appropriate remedy and particularly:
The two decisions underline the importance of clear evidence of a promise. A testamentary intention at a certain moment in time, or an intention that a claimant will have a role relating to the management of the property (as in the Gladstone case above) will not suffice.
Without evidence of a promise, the court will not be required to look at the next two limbs of whether the claimant relied on the promise and suffered a detriment as a result.
Each case will inevitably turn on its own facts, but the courts have set out a clear need for any claimant to demonstrate that a promise was made.
