Proprietary estoppel

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  • Created by: Nikki
  • Created on: 09-04-16 21:38

Key requirements

To establish proprietary estoppel claim, the following three elements must be present:

(1) A promise or representation by the defendant taht the claimant has or will acquire some right in relation to the defendant's land

(2) The claimant's reasonable reliance on that promise/representation

(3) Detriment suffered by the claimant by reason of his reliance on that promise/representation

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Unconscionability?

Sometimes claimed that the dotrine isn't really about detrimental reliance on a promise but rather 'unconscionability', and the three elements of PE are just a means of establishing that breaking the promise would be unconscionable

Each of the requirements has been compromised, so that an estoppel claim can in fact arise in their substantial absence 

If courts are allowing or denying estoppel claims for reasons toher than those embedded in the official approach, what are those reasons?

But not clear that word unconscionable is doing any work here --> it means unfair or unjust --> if we ask why would it be unfair to deny an estoppel claimant their claim? --> the answer is because they reaosnably relied on a promise to their detriment

So to say that the doctrine of PE is founded on 'unconscionability' isn't incorrect, but it isn't helpful either, because you still need to rely on the three estoppel elements to explain why it would be unconscionable to deny a claimant an estoppel claim

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A representation/promise

Can relate to either existing rights or to future rights

Can be tacit or involve mere acquiescence 

Doesn't have to be that C has a specific interest in land --> enough that D promises C some sort of use or access to his land - why may or may not amount to a specific proprietary right 

Has to be clear which land the representation relates to

Substance of representation must be that C does or will have some use of or access to that land

Intention has to be clear 

Cobbe v Yeoman's Row --> can't say D's intention were clear cut --> if they had been he would have put it in writing --> C should have known this

Thorner v Major --> although needed clear representation, what coutned as sufficiently clear depended on context and relationship between the parties

Squaring Cobbe and Thorner --> see powerpoint

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Reliance

Typically ahve to show that you've put yourself in a position thorug an act or omission which you wouldn't have put yourself in but for D's promise/representation

Wayling v Jones --> wider reading --> also act in reliance if you ascribe your detriment not to your belief in having a right over my property at all, but your belief in my trustworthiness

If D alleges that you would have acted as you did anyway then burden is on him to prove it

Note your reliance on D's promise must be reasonable - your interpretation of D's representation, and the action you takein response to it, must be sensible and proportionate

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Detriment

Includes anythign which can be said to leave C worse off if the promise is broken 

Not simply C being worse off but C being worse off as a result of having relied on D's assurance

Has to be C who's left owrse off, not someone else; detriment cannot be vicarious

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Remedies (1)

Estoppel relief is discretionary --> affirmed in Thorner v Major

Court can use discretion to order whatever remedy they think appropriate in the circumstances

Guidance as to factors relevant toe xercise of court's remedial discretion was given by CA in Jennings v Rice (Walker LJ):

  • court award has to be 'proportionate' to value of detriment suffered by C in reliance on D's assurance, while taking in account his expectation
  • in bargain cases, C's detriment is to be regarded as equivalent to his expectation, and 'proportionate' outcome is that of expectation
  • non-bargain cases --> at large
  • outcome has to reflect parties' conduct, need for clean break between them, alterations in D's circ, effect on taxation, other claims on D or his estate, possibly other considerations too
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Remedies (2)

Difficulties with Walker LJ's judgment -->

(1) hard to say what notion of proportionality means 
- offered no guidance as to how expectations and detriment are supposed to be weighed against one another, or how much weight should be given to the other broad-discretionary factors
- suspicion that so long as judges stay somewhere in region between C's detriment and expectation, they are left to decide for themselves on how the aim is to be pursued

(2) puzzle over significance of other factors mentioned 
- none of these affect extent to which estoppel's actual requirements are present
- if they are relevant it can only be because, despite appearances, estoppel is not only about those requirements 

In practice awards have been made by reference frequently to C's expectation and occasionally his detriment

Hint that where C's action is reliance has enriched D, award may involve return of that enrichment

Group of cases in which award seems to reflect more than anything the court's perception of the implications, in the circumstances that had come about, of personal relationships between parties

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Remedies (3)

Once proprietary estoppel granted, whatever right the court confers on C takes effect in exactly same way as if it had been deliberately created yb the parties bound bit it

If you're awarded a personal right, this won't bind future disponees

If you're awarded a proprietary right this will be capable of binding any future disponees who subsequently acquire interests in the land, subject to registration requirements etc

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Inchoate equities (1)

Before the award, C has been descirbed as having only an 'inchoate equity' meaning that hse has the right to come to court and demand some osrt of remedy, but that exactly what remedy she'll be entitled to isn't yet settled

Question was wether this 'inchoate equity' is capable of binding TP to whom D transferred or mortgaged the land before C brought her claim --> courts struggled with this question 

s116 LRA 2002 

  • in relation to reigstered land, an equity by estoppel has effect from the time the quity arises as an interest capable of binding succcessors in title
  • estoppel C's inchoate rights will bind a pruchaser or mortgagee who acquires land before he brings his claim to court so long as he's either protected his rights by registration or his rights take effect as an overriding interest
  • estoppel C's rights crystallise before court rules that he has those rights 
  • so can register an inchoate equity --> even if court says you only get a contractual licence it would beind disponee despite only being a contractual right not against them because it is registered at LR therefore becoming a proprietary right binding upon TP
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Inchoate equities (2)

Better if inchoate equity only boudn TP where C was ultimately awarded a proprietary right, so that TP would be treated same way irrespective of wehter they acquired rights in land before or after the case was heard

Problem that until case has been heard, we won't know what the actual status of the inchoate equity is

Perhaps better still if inchoate equity was simply never binding on TP

  • do away with contractual licences problem
  • fit better with idea that point of estoppel should be to compensate losses incurred by C after relying on rep made by D
  • since TP bears no responsibility for C's losses, it seems very tough if his rights in the land are defeated by estoppel even though a court hasn't yet made an estoppel award in C's favour
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What is estoppel about?

PROMISES OUGHT TO BE KEPT

  • better if remedies were determined upon basis of moral principle that one must keep one's promises --> remedy would be satisfaction of C's expectation by making D keep his actual promise?

2 difficulties with this approach

(1) If promise is to give you an estate in land then it shouldn't be binding becaus eof a lack of formalitiy --> if we're to give effect to such promise through estoppel we're undercutting statutory formality requirements

(2) C has no estoppel claim unless and until he detrimentally relies on D's promise/representation --> until that time D is free to go back on his owrd

Better view = people should be held to their promises if a consequence of their not keeping them is that someone suffers a detriment 

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What is estoppel about (2)

C SHOULDN'T BE LEFT WORSE OFF AS A CONSEQUENCE OF D NOT KEEPING HIS WORD

If this is correct hten estoppel remedies perhaps should be aimed at compensation actual reliance losses without any regard for C's expectations and proportionality 

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What is estoppel about? (3)

EFFECTUATION OF OTHERWISE INEFFECTIVE CONFERRALS

  • prop estoppel operating to give you land where normally law would not
  • relief required is effectuation of my utterance --> one measure sometimes used
  • 2 problems in principle
    • (1) if y assurance takes the form of a conferral or contract it will noramlly be ineffective in itself for want of formality --> if PE can opearte to effectuate my assurance after all, the law appears to subvert its own formality rules
    • (2) why should PE claims yield expectation relief at all? --> loss ought to be that entailed by detrimental reliance, since reliance is basis of this claim
  • unsustainable in principle
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What is estoppel about? (4)

CORRECTION OF RELIANCE LOSS

  • compesation for loss you suffer when you rely to your detriment on your belief, for which I am responsible
  • occasional award of compensation for reliance loss in PE can be ascribed to this aim
  • conects well with PE traditional requirements
  • cannot account for decisions yield other outcomes nor many of the attenuations of the requirements
  • intelligble in principles --> 2 concerns but don't leave project unsupportable
    • (1) economic loss only reocverable in very specific circ 
      • but appears requirements of PE fit with such circ, therefore recovery of economic loss is supportable
    • (2) Cobbe --> limits PE to case where your belief in in an interest over my property 
      • attenuation of requirement of such a belief in Wayling v Jones --> leaves it as an arbitrary restriction on estoppel's scope --> logical next step would be its abandonment, leaving na unproblematic fit with current project
  • requires some violence to traditional understanding of PE as focused on rights over porperty 
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What is estoppel about? (5)

DISTRIBUTIVE JUSTICE

  • requiring me to put you into a certain material position, on ground that our relationship itself requires that outcome
  • best explanation fo treatment of quantum in a number of cases --> appears to reflect implications of parties relationships in circumstances that occured
  • helps to make sens eof Walker LJ's judgment in Jennings v Rice 
    • lack of fit becomes explicable if he was creating space for a project to do something, such as to achieve distributive justice between parties that is unconnected with estoppel's ostensible structue
  • can account for attenuations in requirements for PE claim
    • especially noteworthy that main decisions in which attenuations took place (Gillett and Wayling) were cases where parties had been in long-term relaitnships which could plausibly be regarded as in themselves creating oblgiations on D infavour of C; and that the courts attached importance to this
  • supportable in principle
  • some evidence of this in decisions
  • but attentuation not enough --> project cannot operate coherently without requirements' complete removal frompicture and replacement by explicit reference to relevant relationships --> at which point the jurisdiction will cease to warrant the title 'estoppel' at all
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What is estoppel about? (6)

SUMMARY

  • each project succeeds ind escribing some of what we know about PE, but beyond that the picture is not reassuring
  • textbook P1 --> closest fit with traditional view of PE but unsupportable in principle
  • textbook 2 and 3 --> more readily supportable in principle but demand substantial rewriting of dotrine
  • none of the projects provides an adequate justification for what the law had been doing under name of PE
  • human rights terms
    • in giving your rights against me via doctrine of PE, law intereferes with my enjoyment of my possessions engaging ECHR Art 1, and on approp facts also my home (Art 8)
    • interferences can be justified if they represent proportionate means of securing proper ends
    • but give what we have seen about projects in PE, they do not
      • 1 = unsustainable --> not a proper end
      • 2 and 3 --> sustainable in themselves but doctrine of PE not configured either to say when each should be pursued or honestly to deliver them --> cannot represent a proportionate means of securing them
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