Licenses and Proprietary Estoppel

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Define a License - Vaughn CJ in Thomas v Sorrell [1673]
A Licenses is a permanent permission to enter or occupy the property owned by the person giving the permission, thus making an action which was previously illegal (for example on grounds of trespass) become legal
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Can a license bind a third party?
A license does not equate to an interest in land, it is merely a personal permission to do something. Consequently it cannot bind a third party and nor can it be transferred.
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4 Types of Licence
1.Bare Licence 2.Licences coupled with an interest 3.Contractual licence 4.Estoppel Licence
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Scrutton LJ in The Calgarth [1927]
It is a common principle that if granted a licence, you can only use it for that purpose. Scrutton LJ in The Calgarth [1927] noted how if granted licence to use the staircase, you then can not slide down the banister without technically tresspassing
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Wood v Leadbitter [1845]
A bare licence can be revoked on giving reasonable notice at any time and at the will of the licensor & The licensee must be given a reasonable time to leave the property
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Define a Contractual Licence
A licence which has been given to another for consideration (e.g a ticket to a film). They are generally controlled by contract law
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Define a Licence Coupled with an Interest
An example would be the right to fish (which is a profit á prendre) however must be coupled with a license to use the land in order to do so as it would be otherwise worthless
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Features of a Licence Coupled with an Interest
The licence in this case is irrevocable and grantable to a third party, as it is coupled with the right, which must be created with the proper formalities (e.g a deed).
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Do Contractual Licences Bind a Third Party?
Under the rules in contract law a TP who is not a party is not bound to its contractual terms, and this is reflected in land law where the contractual licensee tends to only have a personal right and not a proprietary one.
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Do Contractual Licences Bind a Third Party - Case
King v David Allen and Sons, Billposting [1916] where the C was given permission to put posters on the walls of a cinema. The cinema was then leased to a TP and the licence did not bind the third party.
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Ashburn v Arnold [1989] vs Errington v Errington & Woods [1952]
The CoA in Errington [1952] elevated CL’s to higher statuses and Denning said “neither the licensor nor anyone who claims through him can disregard the contract except a purchaser for value without notice”. but this was revoked by A v A
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Define an Estoppel Licence
Estoppel Licences are a form of PE, and are used to prevent a licensor from revoking the licence or to grant an interest in land
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Three Facts That May Give Rise to a Claim in Estoppel
1. Promise of a Gift 2. Both Parties have a Common Expectation that One will Acquire an Interest in Land 3. One Party is Mistaken as to Their Rights and Acts upon the Mistake
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1. Dillwyn v Llewelyn [1862]
a father and son signed an informal memorandum which provided that the son would have rights in the land so he could build a house. He did so, spending vast amounts of money. The court upheld the sons claim as he relied on the promise of the gift
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2. Inwards v Baker [1965]
A farther left some land to a friend, but had promised and allowed his son to live on it. Both F&S had the expectation that his S would continue to live on the land as they had built him a house on it. The claim was brought by the friends & it failed
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3. Ramsden v Dryden [1866]
Lord Chancellor “if a stranger begins to build on my land supposing it to be his own, and I, perceiving his mistake, abstain from setting him right, and leave him to persevere in error, court of equity will not allow me afterwards to assert my title
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Willmott v Barber [1880]
Fry J set out five criteria (probanda) for fraud cases, however these criteria have also been used to establish estoppel claims in some situations
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The Case for the Test for Proprietary Estoppel
Taylor Fashions Ltd v Liverpool Victoria Trustees Co Ltd [1982]
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The Test for Proprietary Estoppel - Taylor Fashions
1. The C must show there was an Assurance by the Landowner that gave rise to an expectation that they were to have some interest in the land. 2. The C must have relied on the assurance 3. The C acted to his detriment on relying on that assurance
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4 Things to look for in Estoppel - Taylor Fashions + Cobbe
1. Assurance 2. Reliance 3. Detriment 4. Unconscionablility (Per Walker LJ in Cobbe)
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Re Basham (Deceased) [1986] Rationale for Estoppel
Where person A has acted to his detriment on the faith of a belief that he has or will have a right in or over B's property, known and encouraged by B, B cannot insist on his strict legal rights if it would be inconsistent with A's belief
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2 Types of Assurance
Active & Passive
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Active Assurance
This occurs when an owner of land by his words or conduct leads the C to expect he will have some interest in it
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Active Assurance Case Example
Pascoe v Turner [1979]
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Thorner v Major [2009] - HoL disagreed with Cobbe [2006]
HoL stated that families do not create binding legal documents, and so they should look to the past and ask if it would be unconscionable for the promise not to be kept & reactivated PE in absence of a binding contract
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Passive Assurance
you can by your conduct create an assurance if you do not interfere knowing the land is yours, that will raise an expectation
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Passive Assurance Case Example
Ramsden v Dyson [1866] - ‘if a stranger builds on my land, supposing it to be his own, and I knowing it is mine dont interfere, but leave him to go on, equity considers it dishonest for me to be passive and afterwards to interfere and take profit
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Taylor v Dickens [1998] vs Gillett v Holt [2000] & Thorner v Major [2009]
T v D said wills were revocable and so could not rely on the promise, but this was overruled by G v H and T v M
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Define Reliance
Connects the assurance to the detriment, so that the claimant can be said to have acted because of it. This is rarely in doubt. Where the A has been made, and the C has acted to his D, the reliance element is presumed. Def can rebut presumption.
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Case for Reliance & Reasonable Reliance
Coombes v Smith [1986] - no causal link means no estoppel.& Greasley v Cooke [1980] reasonableness is presumed but can be rebutted by the D
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Explain Detriment
An assurance by itself cannot generate an estoppel as people are entitled to go back on their word, it is the reliance that must be detrimental which make it unconscionable for the landowner to go back on their word.
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Detriment - Gilett v Holt [2000]
The overwhelming weight of authority shows that detriment is required" - the D is to be judged at the time when the person who has given the A seeks to go back on it
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Types of Detriment, Pascoe v Turner [1979]
A woman decorating the house of her former lover was a detriment - "the claimant, having been told that the house was hers, set about improving it within and without... We would describe the work done in and about the house as substantial "
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Types of Detriment - Gillett v Holt [2000]
Suffering Financial Disadvantage Mr Gillett claimed he suffered detriment in the form of opportunity lost by continuing Mr Holt’s employment having rejected other employment offers elsewhere
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Types of Detriment - Re Basham [1986]
Non-Financial Disadvantage – the step daughter cared for her step father, and the court agreed her actions went far further than what was called for by family, and so clearly amounted to a detriment.
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Types of Detriment - Jennings v Rice [2002]
The gardener in this case ran errands for the elderly lady and after a burglary spent many nights on her sofa (even though he had his own family), the court held that this was clearly a detriment
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Types of Detriment - Lord Walker in Cobbe
There also tends to be the requirement of unconscionability as per Lord Walker in Cobbe who argued it was a very important part as an objective value judgment of behaviour, however Professor Birks called it “a fifth wheel on the coach” in 2002.
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Satisfying the Equity, Plimmer v Mayor [1884]
Sir Arthur Hobhouse where he said “the court must look at the circumstance in each case to decide in what way the equity can be satisfied”
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Satisfying the Equity, Jennings v Rice [2003]
Robert Walker LJ ] – “the court must take a principled approach and cannot exercise a completely unfettered discretion according to an individual judges sense of [what is fair]”
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Satisfying the Equity, Court Approach
The approach taken by the court is not reliance loss (based on the premise of compensating the claimant for the loss suffered as a consequence of relying on the assurance) but one of giving effect to the claimant’s expectations as far as possible.
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Satisfying the Equity, Robert Walker LJ in Gillett v Holt [2000]
Robert Walker LJ in Gillett noted the importance of avoiding “future friction” whilst ensuring justice is done between the parties
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Satisfying the Equity, Henry v Henry [2010]
“proportionality lies at the heart of the doctrine of proprietary estoppel and permeates its very application” (furthering that which was expressed by Walker LJ in para 50 of Jennings).
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Satisfying the Equity, Inchoate Equity
This equitable right is called an Inchoate Equity when it has arisen but is not yet satisfied. S116 of the LRA 2002 suggests once the IE comes into existence then it is capable of binding a successor in title, however it is not recognized by LPA 1925
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Inchoate Equity, Henry v Henry [2010]
Henry v Henry [2010] stated an IE could be an overriding interest that binds to third parties.
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Inchoate Equity, Smith in 2011
Smith in 2011 noted that it is controversial if estoppels should bind purchasers as no one knows exactly what the C will be entitled too.
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Ashburn v Arnold [1989]
A licence does not convey a proprietary interest over the land where it is exercised
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Card 2


Can a license bind a third party?


A license does not equate to an interest in land, it is merely a personal permission to do something. Consequently it cannot bind a third party and nor can it be transferred.

Card 3


4 Types of Licence


Preview of the front of card 3

Card 4


Scrutton LJ in The Calgarth [1927]


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Card 5


Wood v Leadbitter [1845]


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